La Poste/Correos JV - postal services

United Kingdom
Background The European Commission has authorised the acquisition by the Spanish public postal operator Correos y Telégrafos (Correos) of a 50% stake in Jet Worldwide España (JWE), previously wholly-owned by Chronopost, which is in turn a subsidiary of La Poste, the French national postal operator. Despite the fact that La Poste and Correos are active on neighbouring markets the Commission nevertheless concluded that the operation did not have the objective or effect of co-ordinating the competitive behaviour. This was because Correos had a strong position on the market for standard mail delivery and La Poste, until the joint venture, had a marginal presence on the express freight market in Spain. Chronopost provides express postal delivery services for items weighing up to 30 kgs through its JWE operation but at the same time offers express freight delivery services for items below 140kgs through another subsidiary, TAT Express. Correos will transfer its “business to business” parcels and document delivery activities to the JWE joint venture. The deal will enable La Poste to reinforce its position on the Spanish market for express delivery of documents and parcels, while Correos will benefit from the international delivery network of Chronopost During the investigation a number of parties expressed concern regarding the alleged use by Correos of revenues stemming its present postal monopolies to finance its expansion into the express services sector. However, the Commission reiterated that, under the Merger Regulation, it will not deal with state aid concerns, as these relate to the means used for setting-up the joint venture and not to the competitive effects on certain markets. (Case No. IV/JV 18: OJ C302 19.10.99; Decision of 1.6.99 (in French))