newsletter 7 0509
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Newsletter TNT EU Information Bulletin Agreement on terms of employment Dutch postal market entirely open to competition On 1 April, the Dutch Government liberalised the final segment of the Dutch postal market – letters weighing up to 50 grams.The Government had set conditions for this final phase and believes that these have now been sufficiently met. The Government had set two conditions throughout the country. Most of their for full liberalisation of the Dutch postal employees now earn less than the mini- In this issue market: a level playing ﬁeld in neighbour- mum wage because they are paid accord- ing countries and proper arrangements ing to how many items they deliver. In Continued uncertainty regarding terms of employment in the mid-February, these companies concluded on German postal market postal sector. It is the view of the State a collective labour agreement with the Secretary for Economic Affairs, Frank unions to take effect simultaneously with AG’s opinion still doesn’t Heemskerk, that Germany and the United the new Dutch Postal Act. The agreement get rid of VAT inequality Kingdom have made sufﬁcient progress provides that within three and a half years towards solving the problems of VAT of the market being liberalised, 80% of Royal Mail to be partly privatised inequality and terms of employment and their employees will have an employment will continue to strive for a level playing contract. To make sure this actually hap- ECORYS Study: market ﬁeld. pens, the Minister of Social Affairs and liberalisation slowing down Employment, Piet Hein Donner, has Special collective labour agreement included a temporary legal requirement. New building produces The Dutch unions agreed to liberalisation Postal companies that fail to comply with no CO2 whatsoever of the postal market now that better the arrangements agreed on can be com- terms of employment are in prospect for Europe needs to ﬁght harder employees of the “new” postal companies against cargo crime Sandd and Selektmail that operate Continued on page 2 June 2009 • Issue 7 2 Continued from page 1 Ready for competition pelled by law to immediately give all their employees a permanent contract. In a response to the announcement, TNT’s CEO Peter Bakker said: “TNT is well prepared for full liberalisation and is ready to take on the competition. TNT will Ahead of EU legislation continue to closely monitor the Government’s guarantee of a proper basic level of With this decision, the Government is employment conditions and is pleased with the Lower House’s support in this anticipating the European liberalisation matter. TNT is asking the Government to continue doing its utmost to achieve a of the postal market in 2011. level playing ﬁeld in the European postal market in the near future.” Minimum wage in Germany: freedom of action for Minister Amended law sidesteps court decisions An amendment to the law by the German Government means that the controversial high minimum wage for the postal sector could still be declared universally binding.The amendment is at odds with the court’s decision based on the original law. Trade union Ver.di has already pressed for labour agreement concluded in the postal costs weigh much more heavily on the a new sector-wide collective labour sector as well as the collective labour delivery costs per item. agreement to be declared universally agreement of TNT Post Germany. The applicable once negotiated with Deutsche contentious high minimum wage puts Ruling upheld Post. The amended law, known as the newcomers to the German postal In its ruling on 18 December 2008, the Employee Assignment Act (Arbeitnehmer- market, including TNT Post, at a serious Higher Administrative Court for Berlin- entsendegesetz), came into force on 24 competitive disadvantage. Because they Brandenburg ruled that the complaint April, thwarting the alternative collective still only deliver low mail volumes, wage submitted by the BdKEP (the German > 3 > Association of Courier, Express and Considerable criticism tion of German Employers’ Associations Postal Services) was well founded. The The Employment Minister is now (BDA), Reinhard Göhner, could not be Court upheld the ruling rendered last empowered to act as he sees ﬁt if con- more clear: “Such an arrangement is year by the lower administrative court, ﬂicting terms and conditions of employ- extremely dubious from the constitu- which said that the collective labour ment apply within a sector. This means tional point of view and extremely risky.” agreement agreed on on 1 January 2008 that he has complete freedom after all to The BdKEP has now submitted a com- with the GNBZ union could not be declare the disputed minimum wage to be plaint against the amendment to the Con- superseded. This agreement also applies generally applicable, and that he can do so stitutional Court. to all TNT Post employees. But the regardless of what the highest court in German Government has now passed a the country may decide. There has been new piece of legislation that makes it pos- considerable criticism of this change in sible for existing wage agreements to be the law in the German media. The posi- superseded by a minimum wage. tion of the chairman of the Confedera- Investigation by German supervisory authority No level playing field Less competition on German The vice-president of the Federal Network postal market last year Agency, Johannes Kindler, is perfectly frank about the way the minimum wage weakens the position An investigation by the Bundesnetzagentur (the German super- of competitors: “It prevents them from beneﬁting visory authority), has found that the market share of the new from one of the few advantages that they have, service providers, which was still increasing slightly in 2007, fell namely the difference in costs.” The VAT exemp- in 2008 to such an extent that new providers are again handling tion enjoyed by Deutsche Post makes that handi- less than 10% of the volume on the German market.That is cap even worse. “With the best will in the world, significantly less than the 14% that TNT Post’s competitors there is no way one can talk about a level playing account for on the Dutch postal market, which has not yet ﬁeld in this situation.” been entirely liberalised. Source: Handelsblatt, 17 December 2008 European Court decision Lack of VAT clarity grows further A recent decision by the European market, whereas those offered by TNT Royal Mail charges have to be submitted Court of Justice (ECJ) has increased are not. for approval to the Government regula- uncertainty about the legitimacy of tor Postcomm. Does this mean that in VAT exemptions on postal services Unequivocal interpretation the United Kingdom there is never any even further. Stark differences exist impossible question of individual contracts? in how experts believe the legisla- The European Court of Justice has deter- tion should be interpreted in the mined that the term “public postal serv- Continuing uncertainty light of the decision by the Court of ice” does not refer to speciﬁc services TNT regrets the continuing uncertainty Justice. but to the service provider. However, at and the fact that no stop has been put to the same time the Court states that not the unfair competition caused by different The Court’s decision concerns the deﬁni- all services provided by the public postal VAT systems for different service tion of the term “public postal services” services are exempt: “Only the supply by providers. which, under the sixth VAT directive, are the public postal services acting as such, exempt from VAT, and the scope of the in their capacity as the provider of the exemption on these services. The ruling universal postal service, are exempt”. This was requested by the High Court of Jus- is impossible to interpret in an unambigu- tice, with which TNT had lodged an ous way. The fact that the Court has also appeal against the validity of Royal Mail’s decided that Royal Mail will need to VAT exemption. The latter’s services are charge VAT on individual contracts does exempt from VAT in the British postal not help to create a level playing ﬁeld. All 4 Deutsche Post continues to benefit until at least 2010 German VAT bill not sufficiently clear-cut The draft bill that is supposed to put an end to Deutsche Post’s VAT exemp- regard do not comply with EU legislation. tion, which hampers competition, is not sufficiently watertight, with all the The German Government wants the bill public tariffs remaining exempt from VAT.The way the bill is formulated gives to take effect from 1 January 2010. This Deutsche Post a great deal of leeway to avoid having to charge VAT. What’s would mean that Deutsche Post’s VAT more, now that the SPD has blocked the draft bill, the date of effect, 1 Janu- exemption – which in fact means that no ary 2010, may not be attainable. competition is possible on half the coun- try’s postal market – will remain in force The bill in fact differentiates between mail Not in any hurry for almost another year. Although the sent by consumers (which is exempt from Although the German Treasury is missing Bundesrat has decided that delaying the VAT) and by businesses (on which VAT out on some EUR 500 million a year, Ger- legislation until 2010 is unnecessary, the has to be charged) according to an insufﬁ- many is still not in any rush to introduce German Government is still sticking to ciently clear criterion, namely whether or the new VAT legislation. It has been clear that date. not the tariffs are “public”. All the tariffs since 2006 that Germany’s rules in this charged to the public remain exempt from VAT. As a consequence, the “public” bulk mail tariffs will remain covered by Maximum consignment size: 50 items Deutsche Post’s VAT exemption. The cur- rent bill leaves too much scope for inter- It would be a simple matter to amend the bill by specifying a maximum consign- pretation and the likelihood is that noth- ment size. The “number of items criterion” proposed by TNT Post is in line with ing will in fact change. German postal regulations. If a consignment consists of fewer than 50 items, it will be covered by the tariff regulations that already apply to the universal postal service. For larger consignments, supervision ex post will apply, giving a clear signal that the German legislature too assumes that – under normal free-market condi- tions – such consignments are subject to competition. British Government follows recommendation in Hooper report Royal Mail to be partly privatised The British Government intends selling off a minority holding in Royal Mail. package: modernisation achieved through A private partner should provide Royal Mail with the expertise and capital it partnership, tackling the pension deﬁcit of needs for the modernisation the company so urgently needs. With this deci- some EUR 8 billion, and changing the reg- sion the Government is following the main recommendation of the Hooper ulatory regime. Besides TNT and CVC, Commission.TNT and the global private equity firm CVC Capital Partners the Danish and Swedish post ofﬁces, have already indicated their interest in a strategic partnership with Royal which are in the process of merging, may Mail. be interested in taking a share in Royal Mail, but to what extent is not clear. According to Richard Hooper, former Major losses vice chairman of Ofcom (the regulator Royal Mail has still not fully mechanised Support from the Opposition and competition authority for the UK its sorting process, as Deutsche Post and Both the Business Secretary Peter Man- communications industries), the situation TNT Post did back in the 1990s. Some delson and Prime Minister Gordon is untenable. Mr Hooper carried out an UK sorting centres still date from the Vic- Brown welcomed the Commission’s pro- independent study of the postal service torian period, with almost all mail being posals. Despite ﬁerce opposition from for the British Government. He believes sorted by hand. As a result, Royal Mail has some Labour MPs and union leaders, Mr that if drastic modernisation of Royal Mail not been able to substantially improve its Mandelson presented a parliamentary bill is delayed any longer, provision of the uni- quality and is suffering severe operational in February 2009 for the partial sale of versal service will be at risk. Therefore, losses. Royal Mail. Support from the main oppo- the primary focus of Mr Hooper’s report sition party, the Conservatives, means is the survival of Royal Mail rather than Package that the Government can probably count the development of competition on the The Hooper Commission emphatically on a Parliamentary majority in favour of British postal market. presented its recommendations as a the proposal. 5 Dutch companies make proposals for completing internal market “We can help the Commission tackle the problems” “When’s it really going to be 1992?”The Dutch business community has recently published a report with this title. It contains the results of a thor- ough analysis of problems on the internal market.The analysis team was chaired by Bernard Bot, who headed the Dutch Permanent Representation to the EU in Brussels for 11 years, and was subsequently the Dutch Minister of Foreign Affairs. “We spent eighteen months on the Postal market report,” says Bot. “We didn’t just come up “What’s now happening on the postal with general observations about the market is more or less the same. The internal market. What we actually did was postal markets in Germany and the produce a survey of the actual obstacles United Kingdom, for example, have sup- so that the European Commission and posedly been liberalised. But the incum- the European Parliament could start tack- bents enjoy advantages where VAT is con- ling them. Where does enforcement fall cerned, while newcomers are subject to short? Where is more, or different, regu- all kinds of requirements. There isn’t any lation necessary? We came up with level playing ﬁeld. Some postal companies answers to those questions on a practical in neighbouring countries are actually Bernard Bot basis.” controlled by the state. The tendency to protectionism hinders the development Europe ’92 of proper competition. I also expect their own industry; they have other prob- The initiative by Dutch businesses is rem- large-scale consolidation in the postal lems to think about than the internal iniscent of the Europe ’92 agenda, which market, similar to the energy market. market. But we still need to point out the the title refers to – the plan in the early Only a few big players will be left, and a problems. It’s a topic that needs continu- nineties to really complete the internal few small niche players. It’s hard to say ous attention. It is a process of raising market. Now, 17 years later, companies who will survive. TNT is one of the most awareness. Many European rules are still face numerous obstacles when trying efﬁcient, best-managed postal companies, drafted by civil servants who have no to access the European market. “That is but we don’t know what the future has in responsibility for their implementation. deﬁnitely true,” says Bernard Bot. “And store.” We have tried to show the reality. Let’s we are asking for people to take those hope that the suggestions from the Dutch obstacles seriously. On the other hand, The crisis won’t help business community will be taken seri- we mustn’t forget that many things have Bernard Bot thinks that the current eco- ously.” happened. Eighty percent is just ﬁne, but nomic crisis will not help completion of the big problem is with services.” the internal market. “The beggar-thy- neighbour policy of the 1930s is coming Unfair race back. Countries are trying to protect “There was a time when everyone in Europe thought that the rules shouldn’t be too strict. We thought that by using About the postal market… framework directives, which leave a lot of The report (When’s it really going to be 1992? – Concrete proposals for completing the implementation freedom to the Member internal market) highlights issues in the postal market: States, we could complete the internal ... In most countries, the incumbents are exempt from VAT, based on their historic market. What happened was that many position as providers of a public service in a monopoly situation. The Commission Member States only carried out imple- introduced amendments in 2002, with the support of the European Parliament. mentation in a half-hearted manner. The The Commission’s proposal was blocked by several large Member States ... result was that a company from one ... Removal of the right to a reserved area of the market encourages postal companies Member State that had to fulﬁl the crite- – often supported by their Government – to look for other protection arrange- ria had to compete with a company from ments ... another Member State that didn’t have ... The German Government has set a minimum wage for the whole postal sector that kind of burden. It wasn’t a level play- that is 30% higher than what the postal union has requested. TNT has been forced ing ﬁeld, making it very difﬁcult to com- to pay a minimum wage that is 30% higher than originally foreseen ... pete. It didn’t work.” 6 Study shows market liberalisation slowing down “On the retreat in many countries” For anyone who has followed developments in the European postal sector, most of the findings in the recent Ecorys report Main Developments in the Postal Sector (2006–2008) will come as no real surprise. “What is remarkable, though,” says Nick van der Lijn, who coordinated the study, “is the way liber- alisation is on the retreat in many countries.The European Commission will need to take further action to ensure that liberalisation of the European postal market goes according to plan.” The researchers expect that not one of tion of how to ﬁnance it); problems con- the countries that still includes a monop- cerning terms and conditions of employ- oly, with the exception of the Nether- ment; and – particularly in Austria and lands, will entirely open up its postal Poland – access to residential letter- market before 2011. Nick van der Lijn boxes.” thinks this is because of a tendency towards “reverse liberalisation” which is Uncertainty in part due to fear of the disappearance “Take the VAT legislation,” says Nick van of the universal service. “That fear may be der Lijn. “There are still enormous differ- Nick van der Lijn justiﬁable in countries with small volumes ences in that respect between the of mail and a low population density. But Member States, and there has been little the main reason for hesitancy – as one progress in recent years. In a number of a problem that leads to uncertainty, and can still see in all sectors subject to liber- Member States, for example Germany, uncertainty is not a good basis for invest- alisation – is that everybody thinks com- there is an unequal situation as regards ing in a country.” petition is a good thing, except in their the national postal company and its com- own sector because that sector is “differ- petitors. But the situation is also unequal Terms and condition of employment ent”. Protecting established interests between countries because the VAT rules and licensing conditions plays a role in all this.” differ from one to the other. What will Terms and conditions of employment and Potential problems change – and where and when it will licensing conditions can also constitute a “Liberalisation involves a balance between change – is by no means certain. Another barrier. “If a competitor is required to do European legislation on one hand and the point is the deﬁnition of what constitutes everything the same way as the national freedom Member States have in imple- the universal service. The fact that one postal company,” says Nick van der Lijn, menting it,” says Nick van der Lijn. country deﬁnes it more broadly than “you end up without any competition.You “You basically have a potential problem another is not really a problem, but it only have real competition when a whenever there is an element that a becomes a problem as soon as you need number of different business models are Member State can decide on for itself. In to deal with the issues of ﬁnancing the in use.You can also create a different busi- the postal market, there are not only all universal service and competition. Com- ness model by having different terms and kinds of strategic barriers but currently petitors are concerned that the inefﬁ- conditions of employment, but then you four major obstacles. These are VAT ciency of the national postal company will are quickly confronted by the employment exemption for national postal companies; be institutionalised. That is deﬁnitely a legislation. That is exactly what is now hap- varying deﬁnitions of what constitutes the potential bottleneck. Regardless of what pening in the Netherlands and Germany. universal service (together with the ques- the EU countries ﬁnally decide, it remains Ultimately, the likelihood of there being competition depends to a great extent on the method of regulation.” Study forms basis for “application report” Work to be done The Ecorys study was the basis for an Application Report to the European Commission, pub- Nick van der Lijn believes that the Euro- lished in December 2008. The Postal Directive stipulates that the Commission must perform pean Commission still has a lot more market studies every two years to keep track of how the European postal market is progress- work to do before all EU Member States ing. The almost 1400-page report – Main Developments in the Postal Sector (2006–2008) – are prepared to open up their postal describes developments in the market and in legislation in each of the various countries. The market to competition. “The Postal analyses making up the report will lead to recommendations to the EC regarding supervision Directive will deﬁnitely not produce and regulation. actual competition all by itself,” he says, “and not all the Member States display a The report can be found under Sector Studies 2008 at: http://ec.europa.eu/internal_market/post/studies_en.htm clear political commitment to liberalisa- tion. The Commission therefore needs to > 7 > play an active role – it’s quite obvious that that is necessary. It is important to avoid The Netherlands still among the leaders imposing sanctions because that will only In most Member States, the national postal company does not yet have any signiﬁcant competi- delay matters for years. I therefore think tion in the addressed mail segment of the market. The study found that end-to-end competition it was a good idea of the Commission to is in fact most highly developed in Germany, the Netherlands, Spain, and Sweden, countries start a series of workshops for regulators where competitors have a market share of between 9% and 14%. Competition is also developing and policymakers.” quickly in Bulgaria because the delivery of hybrid mail there is not subject to the monopoly. Gas supply not necessary New building produces no CO2 whatsoever At the end of October,TNT Post opened an entirely CO2 emission-free building.The company aims to make all future TNT buildings CO2 neutral or Once again the even CO2 positive.This building has won TNT Post the number-one position “sustainability champion” in the top ten most sustainable buildings in the Netherlands.The distribution centre scored 632 points according to the Greencalc certification method TNT has become the “sustainability developed by the Dutch Government Building Department.The highest champion” for the second successive score until now was 323 points. year. The recently published Dow Jones Sustainability Index once more places The new building, a TNT Post mail prepa- The building has been carefully oriented TNT at the top in the “Industrial Trans- ration centre in Veenendaal, produces no towards the sun and has a lot of extra portation” sector, and moreover ranks CO2 whatsoever and is not even connect- windows, reducing the amount of artiﬁcial the company as super sector leader for ed to the gas main. It is heated by pump- light required. More insulation has been “Industrial Goods and Services”. The ing up groundwater, which is at a temper- used than is normal in new buildings, annual Index is based on assessment ature of about 14°C both summer and meaning that the internal temperature is of the sustainability performance and winter. This also allows the building to be less affected by weather conditions. reports of 11,000 companies. TNT’s cooled on hot days. Utilisation of ground- CEO Peter Bakker greeted the news water is one of the countless environmen- Solar cells enthusiastically: “The consistency of tal innovations at the preparation centre. Solar cells have been installed on the roof our result emphasises our commitment so as to generate energy. Energy-efﬁcient to top performance, economically, 70% less energy versions of each piece of equipment have environmentally, and socially.” A combination of environmental measures been used, including even the coffee both large and small produces a major machines. The toilets are ﬂushed using energy saving, in fact more than 70%. rainwater taken from the pond. The towel dispensers check automatically whether they will soon need to be reﬁlled; only when they do is the supplier notiﬁed, thus saving on transport. The containers for collecting paper and non-recyclable refuse are also larger, so that they need to be emptied less frequently. Even the postmen are more environmentally friendly at the Veenendaal building: they are currently testing electric scooters. 8 Europe needs to strengthen its muscles against cargo crime In Europe freight theft and other forms of transport crime lead to a loss of more than € 8 billion each year.TAPA EMEA, the European branch of the Transported Asset Protection Association, organised a conference on the increasing problem of cargo crime, at Schiphol Airport in the Netherlands. Corien Wortmann-Kool, Member of the European Parliament, was one of the key note speakers at the conference. “The trucks are the weakest link,” she noted. “Robbing and hijacking are increasingly popular methods.” Cargo crime is on the increase. The value of stolen goods is growing and there is a Road cargo theft increasing in the Netherlands shift from incidents to organised crime. In The number of reports of stolen freight continues to rise (see graph). The majority takes parallel, the crime has become more vio- the form of canvas cutting, but the number of incidents involving violence against drivers also lent, with the use of physical or armed continues to increase. As the major cargo gateway to Europe, international criminals take a force targeting drivers and even their special interest in the Netherlands. professional escorts. “We see a clear shift towards public areas,” says TNT’s Head of Reported number of incidents of stolen freight in the Netherlands Global Network Security, Dick Muntinga. “As a consequence, the sector is looking 2005 98 for increased cooperation with Govern- ments in order to achieve effective pre- 2006 383 vention, controls and measures securing the full supply chain.” 2007 405 Public Private Partnerships TAPA members say Governments and authorities and the transport sector must Secure parking areas industry need to take action to improve collaborate more closely to safeguard the More than one in three violent incidents the security at truck stops, to collect and security of the whole supply chain. That is occur in parking areas. Therefore more analyse the data on the losses more effec- the only way we can reduce the threat secure parking areas have been marked as tively and to step up international polic- and reverse the growing trend in cargo a high priority by the sector. “At the same ing. Dick Muntinga: “Governments, police loss ﬁgures.” time it is also important that driving and rest time regulations are enforced with some ﬂexibility,” Muntinga points out. Vulnerable Load Card “A driver should never be put in the situation that he cannot drive to a secure counters bogus police parking area out of concerns over driving time restrictions.” A driver transporting a vulnerable and high-value load runs the risk of being stopped by criminals pretending to be police officers. Drivers in the UK can use a Vulnerable Load Card (VLC). The card says that the driver is willing to cooperate, but only by following the officers to a police station. Unfortunately, the VLC is only accepted in the UK. The transport industry is arguing for its implementation in all EU Member States. Publication details This newsletter is a publication of TNT Post Public Affairs P.O. Box 30250 2500 GG The Hague The Netherlands For information, please contact: email@example.com This newsletter has been printed on environmentally friendly paper.