Competition (Sweden): Swedish Competition Authority closes investigation into suspected abuse of dominant position by Posten AB (publ)
- Sweden
- 01/15/2010
- Roschier, Attorneys Ltd. - Sweden
The Swedish Competition Authority (“SCA”) has closed its investigation into a suspected abuse of dominant position by Posten AB (publ) (“Posten”) concerning the application of Posten’s sorting discount for large mail shipments. The SCA initiated the investigation after Bring Citymail Sweden AB (“Bring Citymail”) lodged a complaint claiming that Posten abused its dominant position by offering a special sorting discount for large mail shipments and requested that the SCA order Posten, under penalty of a SEK 500 million fine, to stop offering its sorting discount.
Posten distributes all categories of post in Sweden, including individual mail, office mail and large mail shipments with different delivery terms, i.e. both A- and B-mail. Since spring 2008, Posten has applied a special sorting discount for large sorted mail shipments. Initially the discount was only for addressed direct mail advertising. However, in January 2008, Posten extended the discount to sorted addressed direct mail advertising, sorted economy mail shipments and B periodicals, all with three-day delivery. To receive the sorting discount, the customer should sort and arrange the items handed over to Posten in accordance with Posten’s instructions. According to Bring Citymail, which almost exclusively distributes large mail shipments to approximately half of all addressees in Sweden, Posten’s sorting discount constitutes an illegal loyalty rebate that restricts competition. Posten, in turn, argues that as the sorting and all the preparatory work is performed by the customer itself, which creates cost savings for Posten.
Therefore, the sorting discount compensates the customer for these cost savings. On 18 December 2009, Bring Citymail requested that the SCA speedily close the case in order to use its subsidiary right to bring the case before the Swedish Market Court. According to Swedish rules, if the SCA decides not to take action under the Swedish Competition Act, the party affected by the decision may request its case be heard by the Swedish Market Court. On 22 December 2009, the SCA concluded that there are no grounds to further investigate the case and closed the investigation. Source: the Swedish Competition Authority (www.kkv.se) 22/12/2009
