The Office of Fair Trading, Britain’s lower ‘court’ dealing with allegations of anti-competitive behaviour, has effectively rejected a class action style complaint filed by a number of large direct mail practitioners and agencies, declining to refer their case against the Royal Mail to the Competition Commission.
Instead, the OFT has passed the complaint to Postcom, the independent body set up last year by the government to oversee postal affairs. The decision is a disappointment to the plaintiffs, most of whom prefer to remain anonymous fearing that the raising of heads above the parapet will prejudice their commercial relationships [discounts, commissions and other less official concessions] with the Royal Mail.
However, leading direct marketing shop WWAV Rapp Collins is prepared to stand and be counted. The Omnicom-owned agency is unequivocal in its criticism: “Royal Mail is abusing its position,” it insists.
“We were hoping the ‘super-complaint’ would be the tip of the iceberg, allowing OFT to look at the way Royal Mail operates in the rest of the market. This [decision] is disappointing. We wanted the OFT to investigate because Postcom can only take the narrow viewpoint.”
Protests WWAV chairman/ceo Chris Gordon in a letter to the OFT: “We have significant concerns regarding the potential for anti-competitive behaviour and the apparent inability of the regulator to rectify this.”
[There is a long history of peremptory negotiating tactics by the Royal Mail, ever conscious of its virtual monopoly on mass mailing services. Whether or not Postcom has the teeth to deal with this remains unproven. Few in the industry are confident that its molars are sufficiently well-honed.]
Data sourced from: mad.co.uk; additional content by WARC staff