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Competition and trade law: State aid in French postal sector

United Kingdom
10/02/1998
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State aid in French postal sector

The Commission has decided that the French post office (La Poste) has not provided State aid to Chronopost, a subsidiary company set up by La Poste in 1986 to operate on the French express delivery market.

The Commission received complaints about three issues: first, that the post office provided logistical and commercial assistance to Chronopost at lower than market prices; second, that the subsidiary did not, but should have paid a fee for access to the post office's network; and third, that Chronopost benefited from the privileged tax and customer regime applicable to La Poste.

The Commission decided that the complaints were groundless. Chronopost had paid for the services provided by the post office: during the first two years of operation, amounts paid by Chronopost covered La Poste's variable costs, although not its total costs. After this period, the relationship between the two companies had been strictly commercial and amounts paid by Chronopost to La Poste included a profit margin. La Poste's return on investment exceeded the cost of capital.

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