British postal operator Royal Mail must pay a £7.5 million ($12.5m; €10.7m) penalty for inadequate service.
Regulator Postcom has imposed the fine for the poor performance of Royal Mail's pre-paid business reply units First Class Response and First Class Post Paid Impression. Never before has the watchdog has resorted to financial punishment against the lossmaking mail giant.
Postcom warned Royal Mail last December that improvement was needed in these services and issued an enforcement order requiring the operator to make changes.
"In spite of this," declared the regulator, "Postcom found that Royal Mail failed to do enough to ensure these services met their targets. The company's performance was around 6% below the agreed licensed targets for the year for both products."
The fine comes as Royal Mail faces a one-day strike by its London staff over how much extra they should be paid for working in the ultra-expensive capital. Chief executive Adam Crozier believes Wednesday's walkout could cost the company over £10m, and will do little to endear operator to regulator.
"Postcom's decision on the fine carries a stark message for everyone in Royal Mail," he declared. "It is unlikely that the regulator will make any allowance for falls in customer service caused by a strike."
Data sourced from: Telegraph.co.uk; additional content by WARC staff