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POSTAL PAYMENT ORDERS: POSTE ITALIANE TO BE INVESTIGATED OVER POSSIBLE ABUSE OF A DOMINANT POSITION


PRESS RELEASE



PRESS RELEASE

POSTAL PAYMENT ORDERS: ANTITRUST AUTHORITY TO INVESTIGATE POSTE ITALIANE OVER POSSIBLE ABUSE OF A DOMINANT POSITION IN RECEIPT AND PAYMENT OF FUNDS


By preventing interoperability with other payment methods, the company may be avoiding fair competition, preventing the further development of alternative payment methods offered by other operators and applying unjustifiably burdensome contractual conditions on those who have to pay by postal order.

The Italian Competition Authority, at its meeting on 23 April 2009, decided to launch an investigation into whether Poste Italiane abuses its dominant position in services for the receipt and payment of funds, preventing the further development of alternative methods offered by other operators and applying excessively burdensome contractual conditions on end users.
By the Antitrust Authority's estimate, Poste Italiane has a market share of approximately 90% of payment/receipt services analogous to postal orders, i.e. including, besides postal orders themselves  MAV payments and ‘freccia’ [arrow] bank payments; this market share remains above 50-55% even if banker's order (RID) payments are taken into account. Precisely because of this dominant position, Poste Italiane may be able to apply contractual conditions that are unjustifiably onerous for end users who must pay for the postal order, debiting them with charges relating to services provided to the beneficiaries of the payments such as reporting: for payees, in particular utilities like the power, water and gas companies, but also government departments and local authorities, Poste Italiane's encashment commissions may even be zero, while the payor instead is charged a commission of Euro 1.10 per order (if payment is made at a post office window). On conditions like these, payees obviously have no incentive to seek alternative, competitive payment methods of a banking-financial nature in the marketplace. Poste Italiane's power to set the standards for postal orders, and thus to prevent their interoperability outside of the postal network, also hinders the development of the alternative payment methods offered by other operators: the absence on the postal payment form of the IBAN code, which has been expressly excluded by Poste Italiane, does not for example allow funds to be transferred to the  beneficiary's current account at the post office using the inter-bank system which would be cheaper for the user.


Rome, 27 April 2009