Postal Markets to Open Up

European Union countries agreed on Monday, Oct. 1, to open their 88 billion euro ($125.3 billion) postal markets to full competition beginning in 2011, but 11 countries will be given an additional two-year grace period.

Some countries had wanted to move faster, but the ministers were motivated to reach a compromise that was acceptable of all 27 of the bloc's nations, Herve Novelli, French minister of state for businesses and foreign trade, told the AFP news agency.

"This directive in no way changes the basic rights of the sector and workers in the sector," Portuguese Telecoms Minister Mario Lino told reporters, trying to calm the fears of some postal workers concerned about possible job cuts.

The European Commission, the EU's executive arm, had originally proposed to strip away the remaining barriers to competition from 2009. If a member state wishes to end the state monopoly earlier, as has been the case in some countries, they are permitted to do so.

The 11 nations who may take advantage of the grace period include: Cyprus, the Czech Republic, Hungary, Latvia, Lithuania, Malta, Poland, Romania and Slovakia -- all EU newcomers who have joined since 2004 -- plus Greece and Luxembourg.

The European Parliament still needs to approve the measure, a final step that is seen as likely to occur in February or March as the deal ministers agreed to was largely put together by parliament members.

"In general the parliament is very happy about the result of the council," Markus Ferber, the German lawmaker steering the measure through the EU assembly, told Reuters.

Letters under 50 grams still shielded

National markets for letters weighing up to 50 grams (1.8 ounces) are currently protected from competition. Mail above that weight has already been liberalized.

The European postal sector was liberalized a decade ago for the delivery of packages weighing over 350 grams, then broadened in 2003 to items of more than 100 grams in 2003 and, to letters weighing more than 50 grams in 2006.

The European Commission has aimed to expand on the perceived success of Britain, Finland, and Sweden, which have already liberalized their postal markets. Germany is to open up fully open up its market next year.

The commission has said that greater competition could lead to lower costs and better or customized service. As an extra reason to convince countries to open their markets, only former countries who have liberalized their own postal markets will be eligible to become involved in letter delivery in other EU countries.