Market Definition in EC Competition Law concerning Postal Services

In any competition law case, the definition of the market is vital. The question of whether a company’s conduct may constitute an abuse of dominant position (contrary to Article 82 of the EC Treaty), or whether a merger may justify clearance under the EC merger control rules1 (which are based mainly on a dominance test) depends on the definition of the relevant market; this determines whether the undertaking concerned has significant market power, or a dominant position, in the relevant market. The significance of market definition in postal services sectors has wider implications. It affects the approaches taken, for example, to the question of whether a public postal operator (“PPO”) should be compelled to grant access to its public postal network in a liberalized environment, and the extent to which it may be acceptable for a PPO to cross-subsidize from one postal services activity to another, in particular from the areas protected by statutory monopoly to competitive areas. Such questions are at the forefront of developments in EC competition law in relation to postal services, as we stand on the brink of further liberalization measures, in particular a further Directive amending the existing EC Postal Services Directive (Directive 97/67) (“the EC Postal Services Directive”). This was announced in a Commission press release of 30 May 2000.