Country sheet: Poland - CIRCABC sheet: Poland 715 Summary information on market developments: Postal market segment / aspect Competition (market shares) Main competitors / remarks

Country sheet: Poland 713

Country sheet: Poland

1.1 Summary

Market characteristics

The Polish market is characterised by:

(i) The fact that Poland is a large country with an average population density;

(ii) A growing volume of the market, especially in the unaddressed segment;

(iii) The reserved area encloses items of correspondence but also direct mail;

(iv) Comparatively low quality performance of Polish Post.

Regulatory developments

• The main legal act governing postal activity in Poland is the act of 12 June 2003

(Postal Act 2003), which implements Directive 97/67/EC as amended by Directive

2002/39/EC.

• The Postal Act was amended several times. The most significant changes were

introduced by the amendment to the Postal Law of 18 March 2004 and the provisions

on the freedom of economic activity as well as by the Telecommunications Law.

Changes were, for example, made to the reserved area (reducing the weight limit to

50g and the price limit according to the provisions in Directive 2002/39/EC) and the

process for handling complaints.

Market developments

• The Polish market shows a strong development in volume growth, especially in the

unaddressed mail market. Since 2003 the total number of items grew by 94% (mainly

unaddressed mail) and total turnover increased by about 8%. It is interesting to note

that the total number of alternative operators increased very sharply (more than

tenfold). However, the large majority of these operators are active in the local market

and the main operators are mainly active in the segments for unaddressed mail, cross-

border mail, parcel mail and express.

• In the addressed mail market (including addressed direct mail) the market share of

Polish Post is above 99%. The main barrier to competition is the reserved area; the

reduction of the weight limit in 2006 (from 100g to 50g) seems to have had hardly

any effect on the level of competition in the addressed mail market. There are no

indications that this will change fundamentally before full market opening in 2013.

• In the other markets Polish Post faces more competition. In the unaddressed mail

segment, several parties such as I.D. Marketing, Integer, Dystrybucja Polska and Pro

Direct distributed 1.5 billion items in 2007 and have gained a market share of 72%.

Annex II: Main Developments in the Postal Sector (2006-2008) 714

Large international operators like TNT, DHL and UPS are active in parcels, express

and cross-border mail and compete with Polish Post (e.g. the market share of Polish

Post in parcel mail is 53% in volume and 61% in turnover).

• Access to the letterboxes by competitor postal operators seems to be a major problem,

but the regulation concerning the installation of new letterboxes may provide a

solution. Further, the VAT exemption of Polish Post is a (major) barrier to start

addressed mail delivery.

Other issues

• In terms of employment the alternative operators have grown rapidly. In 2003 they

employed 4,700 people and in 2007 nearly 21,250, while the number of Polish Post

employees was more stable in this period (about 100,000).

• Polish Post warns that the universal service is currently not sufficiently protected by

existing fiscal subsidies. In a 2007 press release Polish Post warned that in the future

the abolition of the reserved area may negatively influence the quality of service as

towards regular collection and delivery (less letterboxes, less clearing and delivery

days) and the opening hours of the post offices (shortening of opening hours).

Discussion points

• Although the actual effect is not clear yet, Poland seems to have solved the problems

related to the access of letter boxes by forcing the owners of estates and houses to

install new letter boxes (before August 2008). In the past this was seen as one of the

main barriers for entry of competition.

• Another interesting development in Poland is the strong increase in the number of

alternative operators. Although, these (local) operators mainly focus on unaddressed

mail, cross-border mail, parcel mail and express mail, this indicates that entrepreneurs

are active on the market and make use of the opportunities they have. Despite this

fact, competition in the addressed mail segment is still lagging.


Summary information on market developments:

Postal market segment / aspect Competition (market shares) Main competitors / remarks

Express Competitive UPS, DPD, GLS Poland, DHL,

TNT and Spring

Parcel (main players) NPO (46%) UPS, DPD, GLS Poland, DHL,

TNT and Spring

Unaddressed NPO (28%) I.D. Marketing, Integer,

Dystrybucja Polska and Pro Direct

Cross-border mail NPO (95%) UPS, DPD, GLS Poland and TNT

Express

Addressed mail (market share

CPOs)*

< 1% Only some local initiatives

Population density (inhabitants/km2) 118

Total addressed mail market (items) 1.8 billion items

Addressed mail volume per capita 43.9 (2006)

Status of NPO Since 1997, Polish Post has the

status of a state-owned public

utility

The (legal) preparations

conversion of Polish Post into a

joint stock company (with 100%

state ownership) started in March

2007

Main divisions of NPO Mail, parcel & express, financial

services

Note: * The market share of CPOs refers to the combined market share of CPOs in domestic addressed mail

delivery, excluding newspaper delivery. All figures refer to 2007, unless stated otherwise.

Summary information on the implementation of the Postal Directive:

Aspect Implementation and remarks

Universal service and its

financing

The universal service is in line with the Directives. The universal service should be

provided for domestic and international traffic on the territory of the Republic of

Poland, in a consistent way on comparable conditions and at affordable prices,

maintaining the quality required by law and ensuring emptying the mail boxes and

delivery of the postal items at least on every working day and not less than five

days a week. The universal service provider can obtain a subsidy if there appears

a loss on the universal service.

Reserved area The reserved area covers: (i) domestic mail: the clearance, transport and delivery

of items with correspondence and direct mail up to 50g; (ii) international mail: the

clearance, transport and delivery of items up to 50g; and (iii) domestic and

international mail: postal money orders. Items of correspondence are defined as

‘information recorded on any available material carrier, (…) with the address

inserted by the sender, with the exclusion of books, catalogues and press

magazines.’

Licensing and network

access

Postal activity with respect to the clearance, transport and delivery of postal items

within the universal postal service as well as items for blind persons, requires a

license. For services outside the universal service postal operators do not need a

license, but have to be registered on the basis of a written application. This register


Aspect Implementation and remarks

is also governed by the NRA. No specific provisions are made in the law

concerning regulated or negotiated upstream or downstream access. Provisions for

transparent and non-discriminatory access are not mentioned in the regulatory

framework. In practice there is no demand for either (yet).

Tariff principles and

transparency of accounts

Ex-ante price regulation of the reserved and USO services has been introduced

since 2008 (article 51 Postal Act 2003). There is no price-cap regulation, but the

prices of universal services should be cost based (article 50 Postal Act 2003).

Polish Post is required to keep an accounting system separately for each service

from the reserved area as well as altogether for non-reserved services (while

making a distinction between universal postal services and services outside the

universal service).

Quality of services A study on transit times between November 2006 and December 2006 showed

that only the requirements for transactional mail for D+3 was met. Polish Post also

did not meet the requirements for direct mail. The (under)performance was

influenced by strikes of mail dispatchers and postmen in November and December

2006.

The national regulatory

authority

Since January 2006, the Office of Electronic Communication (UKE) is the

responsible NRA. Before 2006, the regulatory function was governed by URTiP

(Office of the President of Telecommunications and Post Regulation). At the end of

2006 a total of 28 staff-members were responsible for postal market regulation, 12

people in the head office and 16 people in the regional offices.

1.2 General information

Poland is a rather large country with an average population density (118 inhabitants/km2

compared with the European average of 113 inhabitants/km2). Circa 11% of the 38

million inhabitants live in the five largest cities, of which Warsaw is the largest with 1.6

million inhabitants (see Table 0.1).

Table 0.1 General country information (2007)

Poland

Population (in million) 38.1*

Size of the country (1,000 km2) 323.3 *

Population density (inhabitants/km2) 118.0*

Degree of urbanisation 62.1**

Number (and percentage) of inhabitants 5 largest cities 4.3 million (11%) ***

Sources: * UPU (2006), ** UN (2005), *** World Gazetteer (2008 estimation).


1.3 Regulatory developments

1.3.1 Postal law and regulation

The main legal act governing postal activity in Poland is the act of 12 June 2003 (Postal

Act 2003) which implements Directive 97/67/EC as amended by Directive 2002/39/EC.

The Postal Act 2003 takes into account the Accession Treaty in the scope of transitional

periods negotiated by Poland, which enabled Poland to open up the market slower than in

other EU-countries. The following stages were envisaged:1

• Stage 1: from 1 January 2004 until the date of Poland’s accession to the EU, i.e. 1

May 2004. At the end of this stage the reserved area for the universal service provider

decreased from 500 grams to 350 grams;

• Stage 2: from 1 May 2004 until 31 December 2005. During the EU summit held in

Copenhagen on 12-13 December 2002, Poland was awarded a transitional period

until 31 December 2005 for maintaining the weight limit of 350 grams within the

reserved area;

• Stage 3: from 1 January 2006 until the full opening of the market, initially planned

for 1 January 2009, but postponed until 2013. Currently the weight limit is 50g and

the price limit – at least 2.5 times higher than the public operator’s tariff for the

fastest item in the lowest weight category;

• Stage 4: Fully opened postal market.

The Postal Act was amended several times. The most significant changes were introduced

by the amendment to the Postal law of 18 March 2004 and the provisions on the freedom

of economic activity as well as by the Telecommunications Law. Changes resulting from

the amendment to the Postal law in particular referred to the introduction of:

• a weight limit for postal items with correspondence within the reserved area – 50g

and 2,5 times the ‘standard’ tariff starting from 1 January 2006;

• special tariff options for bulk senders;

• a ban to subsidise universal postal service not comprising reserved services by

revenues from reserved services (excluding cases when this is necessary to maintain

universal service);

• a right to lodge a complaint on a delayed delivery of a letter item by an addressee or a

sender;

• an obligation for the public operator to present information concerning the number of

complaints on a delayed delivery of a letter item to the President of UKE, together

with its postal activity report.

1 UKE (2006), p. 99-100.


The regulations are (in short) the following:

Table 0.2 Postal law and regulation

Postal law and

regulation

Date of introduction Date of latest

amendment

Remarks

the Act of 12 June 2003 -

Postal Law

24 August 2003 10 October 2007 This act implements the regulations of

the directive 97/67/EC amended by

Directive 2002/39/EC of 10 June 2002

with regard to the further opening to

competition of Community postal

services

Ordinance on the

conditions for the

provision of universal

postal services

22 January 2004 23 July2005

Ordinance on complaints

concerning the universal

postal service in relation

to a recorded item and a

postal money order

11 November 2003 10 May 2005

Ordinance on mail boxes 28 October 2003

Ordinance on letter boxes 28 October 2003 05 May 2004

Ordinance on the method

for cost allocation of the

operator providing

universal postal services

1 January 2004

Law of 30 July 1997 on

the State Enterprise of

Public Utility "Poczta

Polska"

11 October 1997 01 January 2008

The Act of 16 July 2004 -

Telecommunications Law

2 September 2004 20 July 2007 In the field of postal matters this act

sets out the duties of the President of

the Office of Electronic

Communications (Polish NRA – UKE)

in scope of telecommunication and

postal market; settling civil law

disputes between consumers and

postal operators by Permanent

Consumer Arbitration Courts at the

President of UKE (art. 110)

Source: ECORYS questionnaire – NRA and Ministry of Infrastructure.


1.3.2 Universal Service Obligation

Scope of the universal service

The universal service is defined as the postal services consisting of (article 4.25):

• clearance, transport and delivery of:

o letter items weighting up to 2kg, including registered letters and insured letters;

o postal parcels weighting up to 10kg, including insured parcels;

o postal items for the blind persons.

• delivery of postal parcels sent from abroad weighting up to 20kg;

• handling of postal money orders.

The universal service should be provided within domestic and international traffic on the

territory of the Republic of Poland, in a consistent way on comparable conditions and at

affordable prices, maintaining quality required by law and ensuring of emptying the mail

box and delivery of the postal items at least on every working day and no less frequently,

than 5 days a week.

Financing of the universal service

Until now, the reserved area functions as a compensation for the costs of the universal

service, beside some form of state aid (see paragraph 1.5.4). When it appears that the

universal service causes a loss the universal service provider can obtain a subsidy.

Provisions for the blind

Blind persons and organisations of blind persons are exempted from the postage fee for

clearance, transport and delivery (article 30).

Other issues

In a press release Polish Post warned that the abolishment of the reserved area may

negatively influence the quality of service in regarding regular delivery, the emptying of

the letter boxes and the opening hours of the post offices.2

In a ‘Public Consultation on postal services and market opening and the universal postal

service’ (Part 2, 2006) Polish Post expressed the following interesting statements in

reaction to the 21 questions posed in the consultation, mainly related to the universal

service:

• Q2: Universal Service Obligations should not be applied uniformly as the scope of

universal service should depend on economic, geographic and other conditions of the

member states;

• Q4: Calculating the cost of the USO: there should not be any common methodology

for assessing the cost of the US (…) but a way to set the methodology;

• Q10: Role and responsibility of the NRA: we do not see any need for more precise

definitions concerning the independence, the role and responsibility of the NRAs;

• Q15: Cost coverage: each member state should decide whether to apply uniform

tariffs be applicable on its territory or not, especially that prices must be geared to

costs (…). Uniform tariffs not always cover the costs of particular service (…) when

service are provided on extensive and difficult accessible areas;

2 EurActive.com; EU news from 4

th of January 2007.


• Q17: price control: Price controls should be restricted only to universal service,

irrespective of the fact whether they are provided under conditions of market

dominance or in competitive market.

1.3.3 Reserved area:

Under the Postal Law an exclusive right to provide reserved services has been granted to

Polish Post (Poczta Polska). The reserved area covers (article 47):

• in domestic traffic: the clearance, transport and delivery of items with correspondence

and direct mail up 50g;

• in international traffic: the clearance, transport and delivery of items up to 50g;

• in domestic and international traffic: postal money orders.

Items of correspondence are defined as ‘information recorded on any available material

carrier, (…) with the address inserted by the sender, with the exclusion of books,

catalogues and press magazines’ (article 3).3

The provision of these services by private operators is not in the reserved area if an

operator charges at least 2,5 times more than NPO for the fastest item in the lowest

weight category (currently 50g, priority item).

Table 0.3 Liberalisation of postal services and the reserved area (2008)

Postal product Within reserved area

(Yes, no, partially or unclear)

Remarks

Bulk mail and consolidation Yes

B2B non-bulk mail Yes

Individual item mail Yes

The reserved area encloses items

of correspondence and direct mail

up to 50g

Items of correspondence

Cross-border mail Yes Within reserved area up to 50g

Unaddressed mail No

Parcel mail No

Express mail No

Source: ECORYS questionnaire – NRA and Polish Post.

Plans for next steps

The NRA refers to the fact that Poland is one of the countries that according to the third

Postal Directive may postpone the date of full market opening until 31 December 2012.4

3 Direct mail: postal item containing only advertisement, marketing or promotional materials, being sent on the one time basis

to at least 20 addressees, having identical content, differing only by the identification data of addressees’ non-changing the

content of transferred information, and in particular related to the name, address or other variable data; 4 ECORYS questionnaire – NRA.


1.3.4 NRA

Regulatory functions with regard to postal services are handled by the Office of

Electronic Communications (UKE) since 14 January 2006. Before that date, the

regulatory function was governed by URTiP. UKE’s president issues licenses regarding

postal activity and maintains the register of postal operations. The President of UKE is

also the specialised authority in the area of equipment conformity assessment, including

telecommunications terminal equipment and radio equipment.

On 14 January 2006 a new body of government administration was established – the

President of the Office of Electronic Communications (President of UKE) to take over

from the liquidated Office of the President of Telecommunications and Post Regulation

(URTiP).The President of UKE took over the tasks and powers that had so far rested

within the competence of the President of URTiP as well as certain powers of the

President of the National Broadcasting Council (KRRiT). The activities of the President

of the Office of Electronic Communications are supervised by the minister competent for

communications (currently the Minister of Infrastructure in charge of the communications

sector). The duties of the President of the Office of Electronic Communications have

been set out in: (i) the Act of 16 July 2004 - Telecommunications Law, (ii) the Act of 12

June 2003 - Postal Law, and (iii) the Act of 30 August 2002 on the conformity

assessment system.

The specific duties of the President of the Office of Electronic Communications include:

• intervening in matters related to the functioning of the market for telecommunications

and postal services, the equipment market and the settlement of disputes between

operators;

• cooperation with domestic and international telecommunications and postal

organizations, other competent national authorities, the European Commission and

Community institutions, as well as other NRAs;

• cooperation with the President of the Office for Competition and Consumers

Protection in matters related to the enforcement of the rights of parties using postal

and telecommunications services, and with the National Broadcasting Council.

The President of UKE submits, annually before May 15th, a report to the minister

competent for post and telecommunications, on the basis of information obtained from

the operators, evaluating the functioning of postal services markets, and including the

results of the postal activity inspection.

In addition, the President of UKE publishes in the UKE Bulletin, before May 31st, the

annual report containing the results of examinations of quality of universal postal

services, reached by the operator providing universal postal services within the preceding

year and also the information on number and kinds of submitted complaints and about the

method of their handling, having regard to the separation of them into universal postal

services and services, which are not falling under the scope of universal postal services.

Capacity and organisation

As of 31 December 2006 there were about 564 persons employed in UKE (including 16

local branches), 247 in the head office and 252 in the regional offices. In total 28 staff-


members are responsible for postal market regulation, 12 persons in the head office and

16 persons in the regional offices. The Postal Market Department situated in the head

office consists of two divisions: (a) the Division of Postal Activity Control, and (b) the

Division of Analyses and Reporting. In addition, there is the Independent Position

(Specialist) for Authorisations and Registration.

Studies

During the period under consideration, some studies were carried out, e.g. concerning the

transit time and the concerning consumers satisfaction. These results will be discussed

later.5

Furthermore, UKE carried out an audit of the alternative postal operators in which 49

operators were controlled. The purpose of the audit was to determine whether these

operators pursued postal activities in compliance with the provisions of the Postal Law

and especially in the reserved area of the Polish Post. The findings were (in short):6

• As the alternative postal operators are acting mostly in the area of the parcel service it

“would therefore appear that the liberalisation of the letter mail market has no impact

on the charge levied by these operators for the delivery of letter items.”;

• One alternative postal operator is organising its postal business (items of

correspondence) on a large scale in the national territory. A comprehensive audit is

planned in 2007 especially in view of assessing the development of its local outlets;

• The audit did find that four operators violated the reserved area of the Polish Post.

Hence the UKE-President issued administrative decisions mandating discontinuance

of postal activities.

Number of complaints and redress procedures in 2006

In 2006, 146 complaints were handled by UKE. Furthermore, 357,429 claims

(complaints) were lodged by consumers for improper performance of postal operators.7

Powers of the NRA

Table 0.4 shows the regulatory powers of the NRA. Article 44 of the Postal Law obliges

the USP to annually submit information related to volumes, postal offices, the number of

mail boxes and the number and kind of submitted complaints and the methods of their

handling. Polish Post is required to keep an accounting system separately for each service

from the reserved area as well as altogether for non-reserved services (with distinction

between universal postal service and services not comprising universal postal service).

5 UKE (2007b), p. 97.

6 UKE (2007b), p. 97.

7 Provisions on procedures: vide the Act of Postal law, art. 48a (plaints) and Chapter 5 (claims); further: the Ordinance of the

Minister of Infrastructure on complaints concerning the universal postal service in relation to a recorded item and a postal

money order of 13/10/2003 (claims).


Table 0.4 Regulatory powers NRA

Powers Yes/No/Unclear Remarks

Require data from USP Yes Financial report

Require accounting system Yes

Require new data studies Yes

Cancel unlawful rates Yes Universal service price-list

Levy Fines Yes

Seek judicial order Yes

Set new rates for USP Yes

Require downstream access No

Require data from non-USPs Yes Control of postal activity


1.3.5 Licenses

According to the Postal law, postal activities with respect to the clearance, transport and

delivery of postal items with correspondence up to 2kg (excluding the reserved items up

to 50g) performed in the way specified for universal postal service as well as items for

blind persons, requires an license (or authorisation). As a result, the scope of licenses has

been much reduced and starting from 1 January 2006 practically covers only the universal

postal service within the weight range between 50g and 2kg (licenses had earlier been

issued for postal items with correspondence and items for blind persons).8 In other words,

article 6(1) stipulates that in fact within the universal service a license is required.

The provisions of the Act of 6 August 2004 on the freedom of economic activity have

implemented new solutions consisting in the replacement of licenses for conducting

economic activity with an entry to a register on the basis of an undertaking’s declaration

of compliance with the requirements provided for in the law. Regulated activity within

the meaning of the law on the freedom of economic activity, i.e. postal activity not

requiring an authorisation, is now subject to an entry to a register of postal operators (on

the basis of a written application).9 For services outside the universal service postal

operators do not need a license, but have to be registered on the basis of a written

application (article 6.2 Postal Act). This register is also governed by the UKE.

Conditions

Licenses are issued by the UKE after confirmation of the rather general conditions

mentioned in article 10 of the Postal Act. An entrepreneur must for example comply with

(i) the conditions for the maintenance of postal secrecy, (ii) establish transparent and non-

discriminating conditions of handling complaints, and (iii) he must be in possession of the

technical and organisational base matching the size of planned activity.

Table 0.5 shows a summary of these entry regulations.

8 ECORYS questionnaire.

9 ECORYS questionnaire.


Table 0.5 Entry regulation

Instrument Services allowed under

the license

Conditions for obtaining

the licence

Number of licences

approved (2007)

License Universal services

(Performance of the

postal activity with the

scope of clearance,

transport and delivery

provided within domestic

and international traffic of

postal items: (i) f or the

blind, and (ii) with the

correspondence up to

2000g)

Conditions regarding

postal secrecy, handling

of complaints and having

technical and

organisational base.

6 (including Polish Post)

Register Non-universal services Conditions regarding

postal secrecy and

handling of complaints

159

Total 165 (including Polish

Post)

Source: Postal Act 2003; UKE (2008a), figures as of 31 December 2007.

The number of private operators increased from 30 in 2001 to 164 in 2007 (see Figure

0.1). Most of these operators are active in the express and courier segment. 51% of these

164 private entities can be assessed as ‘local’, 22% is active in whole Poland, 20% is

active in both Poland and abroad, and 7% is only active abroad (only cross-border mail).

None of the five alternative operators with a license is currently providing services within

the universal service.10

Figure 0.1 Number of private operators in the years 1996-2007 (at 31 December)

0

20

40

60

80

100

120

140

160

180

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Private operators

Source: UKE (2008a), p. 15.

10

ECORYS questionnaire – NRA and Ministry of Infrastructure; UKE (2008b).


1.3.6 Access

No provisions are made in the law concerning regulated or negotiated upstream or

downstream access (see Table 0.6).11

Provisions for transparent and non-discriminatory

access are not mentioned in the regulatory framework as well.12

Private letter (delivery)

boxes have to be accessible for all operators per August 15th, 2008.

Table 0.6 Network access

Upstream/downstream Form of access Regulated?

(Yes, No, Unclear)

Upstream Access to street letter boxes-no

Access to outward sorting centres-

no

Downstream Access to inward sorting centres-no

Access to delivery offices-no

Access to PO boxes-no

Not regulated

Source: ECORYS questionnaire – UKE and Polish Post.

1.3.7 Price regulation

Ex-ante price regulation of the reserved and USO services has been introduced since 2008

(article 51 Postal Act 2003).13

Within the universal service, fees should be established with regard to the costs of their

provision and should be uniform on the entire territory of the country and transparent and

non-discriminatory (article 50). However, the use of uniform tariff does not exclude the

right of operators to use special (negotiated) tariffs, under the condition, that the operator

while setting prices (i) applies towards senders uniform and equal criteria concerning

both prices and conditions related to the contract, and (ii) takes into account the costs of

provision of the service comprising of the full scope of performances related to postal

service of the given, excluding costs avoided in relation to the limitation of activities

performed by the operator (article 50).

It is prohibited to cross-subsidize the non-reserved universal service with the income

from reserved services, unless the subsidy is necessary to provide these universal services

(article 50a).

There is no price-cap regulation, but the prices of the universal service should be cost

based (article 50). The NRA may raise an objection to a new project of price list and as a

result they will not come into force.14

11

ECORYS questionnaire – NRA and Polish Post. 12

ECORYS questionnaire – NRA and Ministry of Infrastructure. 13

ECORYS questionnaire – NRA. 14

ECORYS questionnaire – Ministry of Infrastructure.


Polish Post (article 52) is required to keep an accounting system separately for each

service from the reserved area as well as altogether for non-reserved services (with a

distinction between universal postal service and services not comprising universal postal

service).

1.3.8 Quality of service

The quality thresholds and performances of Polish Post are shown in Table 0.7. The study

of transit times between November 2006 and December 2006 showed that only the

requirements for transaction mail D+3 was met. Also the requirements for direct mail

were not met. The bad performance was probably the result of strikes by mail dispatchers

and delivery service in November and December 2006 (see also the section on

employment).

Further, a study was carried out concerning the postal outlets, in which one concluded

that they did not “fully comply with the statutory requirements and (…) there was no

improvement to the study in 2002”.

Table 0.7 Quality of service USP

Standard Threshold Performance USP Remarks

Transit time transaction mail

D+1

D+2

D+3

Transit time direct mail

D+5

82%

90%

94%

97%

68%

87%

94,4%

89%

Transit time for cross-border

priority mail

85% Incoming: 85,5%

Outgoing: 84%

Transit time parcels

1st class (D+1)

2nd

class (D+3)

80%

90%

57.8

84.3

The test for parcels was

carried out between 16th of

July and 9th November 2007,

therefore the results provide

no grounds for the

assessment of annual transit

time parameters in 2007

Source: ECORYS questionnaire – NRA and Polish Post; UKE (2007a), UKE (2007e).


1.4 The mail market

1.4.1 Mail market overall

According the NRA and Polish Post the market for postal services in Poland can be

divided into the universal service and postal services outside the universal service area,

including express services.

The next table shows that volumes for, especially, unaddressed mail, parcels and express

and courier services grew very fast during the period 2005-2007. Cross-border mail (both

inbound and outbound) declined. The volume of addressed direct mail increased by 30%

compared to 2005, while the volume of domestic mail above 50g increased threefold.

Turnover patterns are more or less similar.15

Table 0.8 Overall volume and turnover of the postal market 2005-2007

Category Segment 2005 2006 2007 2005 2006 2007

Volume (million items) Turnover (million PLN)

Letter mail Domestic <50g 1,460 1,205 1,420 2,775 2,375 2,495

Domestic >50g 40 205 180 100 470 465

Direct mail

(addressed)

150 165 195 175 205 235

Catalogues - - - - - -

Magazines /

periodicals

- - - - - -

Cross-border

(inbound)

60 60 50 70 70 75

Cross-border

(outbound)

65 70 40 285 490 330

Newspapers - - - - - -

Direct mail

(unaddressed)

1,865 3,290 3,200 135 205 180

Parcel mail Parcels 30 75 80 265 1425 1645

Express and courier

services

Documents,

parcels, letters

3 25 25 90 320 370

Total 3,673 5,095 5,190 3,895 5,560 5,795

Total (in €) 967.9 1,427.3 1531.6

Source: ECORYS questionnaire – UKE (estimations).

Note: The NRA indicates that these figures are estimations due to the fact that their annual postal market

reports are arranged in different categories than given in this table. The figures can differ from the UKE annual

report to some extent because this table includes domestic and cross-border items and the UKE report includes

other services than listed here (e.g. money postal orders).

15

Throughout we use the following exchange rates: € 1,- for 4.023 PLN (2005), 3.8959 (2006) and 3.7837 (2007), based on

Eurostat averages (Euro/ECU exchange rates - Annual data).


In its postal market assessment of 2007, the NRA found that the total number of postal

items has been increasing between 2005 and 2007 (see tables below). Since 2005 the total

number of items grew by 41%. This growth can largely be attributed to the increase in

unaddressed direct mail transactions. In 2006 and 2007 growth rates for the total market

were 39% and 1.8%, respectively.

Table 0.9 The number of postal items in domestic transactions from 2005 to 2007 for domestic and cross-border items (in

million items)

2005 2006 2007

Addressed items 1,810 1,805 1,990

o/w items of correspondence o/w 1,625 o/w 1,540 o/w 1,690

o/w parcels & express o/w 33 o/w 100 o/w 105

o/w addressed direct mail o/w 150 o/w 165 o/w 195

Unaddressed (direct) mail 1,865 3,290 3,200

Total 3,673 5,095 5190

Source: Source: ECORYS questionnaire – UKE (estimations), UKE (2008a and 2008b).

Note: Addressed items includes items of correspondence, addressed advertising and parcels.

Table 0.10 The revenue generated from the sale of postal services (including direct mail) between 2005 and 2007 for

domestic and cross-border items (in million PLN and €)

2005 2006 2007

Addressed items 3760 5355 5615

Unaddressed (direct) mail 135 205 180

Total (in PLN) 3,895 5,560 5,795

Total (in €) 967.9 1,427.3 1531.6

Source: ECORYS questionnaire – UKE (estimations), UKE (2008a and 2008b); used exchange rates: € 1,- for

4.023 PLN (2005), 3.8959 CZK (2006) and 3.7837 (2007), based on Eurostat averages (Euro/ECU exchange

rates - Annual data).

Note: Addressed items include items of correspondence, addressed advertising and parcels.

In Table 0.11 and Table 0.12 the standard tables are provided, which provide similar data

as the unnumbered tables above (we have no indication why these figures differ). The

addressed mail segments comprises circa 1.8 billion items (circa 35% of the total market)

but generates (probably) more than 70% of all revenues.

Table 0.11 Size of the mail market in turnover (million PLN and million Euro)

Postal product 2005 2006

Bulk mail and consolidation n.a. n.a.

B2B non-bulk mail n.a. n.a.

Individual item mail n.a. n.a.

Addressed mail 3,050 (€ 757.9) 3,050 (€ 782.9)

Cross-border mail 355 (€ 88.2) 560 (€ 143.8)

Unaddressed mail 135 (€ 33.5) 205 (€ 52.6)

Parcel mail 265 (65.9) 1,425 (€ 365.8)

Express mail 90 (€ 22.4) 320 (€ 82.1)

Total 3,895 (967.9) 5,560 (1,427,3)


Source: ECORYS questionnaire – UKE (estimations), UKE (2008a and 2008b).

Note: n.a. is not available.


Table 0.12 Size of the mail market in physical terms (million items)

Postal product 2005 2006

Bulk mail and consolidation n.a. n.a.

B2B non-bulk mail n.a. n.a.

Individual item mail n.a. n.a.

Addressed mail

o/w transaction mail

o/w direct mail

o/w others

1,650

n/a

o/w 150

n.a.

1,575

na

o/w 165

n.a.

Cross-border mail 125 130

Unaddressed mail 1865 3290

Parcel mail 30 75

Express mail 3 25

Total 3,673 5,095

Source: ECORYS questionnaire – UKE (estimations), UKE (2008a and 2008b).

Note: transaction mail (1st class mail, business mail), direct Mail (addressed 2

nd class mail, advertising mail, bulk

mail), others (magazines, newspapers, addressed catalogues) and unaddressed mail (flyers, brochures,

unaddressed catalogues).


1.4.2 B vs C

The stakeholders could not give an up-to-date estimation of postal streams. Therefore, we

refer to the ECORYS 2005 study for these figures (see Table 0.13 and Table 0.14).

Table 0.13 Postal streams in the market for addressed mail in turnover (million Euro)

Postal stream 2006

B2B n.a.

B2C n.a.

C2B n.a.

C2C n.a.

Source: n.a.


Table 0.14 Postal streams in the market for addressed mail in physical terms (million items)

Postal stream 2004

B2B 10%

B2C 80%

C2B 5%

C2C 5%

Total 1,575 (2006)

Source: ECORYS (2005a).


1.4.3 Market opening

The UKE reports a substantial increase in the number of private operators (from 15 in

1996 up to 164 in 2007). The regulatory authority, however, acknowledges that this

growth can predominantly be felt by business customers in urban areas, because private

operators are active only in cities and targeted mainly at bulk senders.16

This is supported

in the Eurofound report on Poland that states that most private operators have a purely

local character and jointly control approximately 10 percent of the market, mostly with

regard to courier services. As a result, these operators are believed not to constitute

serious competition for PP.17

The NRA states that outside of the reserved area the market is open to competition. They

estimate that the reserved area is circa 25 % of the postal market.18

As shown in the next

table the non-reserved area was 6% of the total market in 2003.

Table 0.15 Division between the reserved and non-reserved area for domestic and cross-border mail (in million items)

2003 2004 2005 2006 2007

Reserved area 1,737 1,931 1,670 1,363 1,489

Non-reserved area 115 190 171 385 505

Total (excluding unaddressed) 1,852 2,121 1,841 1,748 1,994

Source: UKE (2008a and 2008b).

Note: Total includes items of correspondence, addressed advertising and parcels.

The segments for unaddressed mail, parcels and express do not fall under the reserved

area and are free to enter.

1.4.4 Cross-border mail

International traffic (clearance, transport and delivery of items) up to 50g is part of the

reserved area. In volumes, the cross-border mail market encloses circa 65 million items.

Polish Post is (still) the dominant operator, while also TNT, DHL and UPS are active on

the Polish market.

1.4.5 Impact of innovation

Mail substitution

Neither the Ministry nor Polish Post could specify the degree/percentage of substitution

of mail through electronic media (see Table 0.16).19

16


Eurofound (2007). 18


ECORYS questionnaire – NRA and Polish Post.


Table 0.16 Impact electronic substitution

Postal product % change in total market volume (avg./year)

Bulk mail and consolidation n.a.

B2B non-bulk mail n.a.

Individual item mail n.a.

Cross-border mail n.a.

Unaddressed mail n.a.

Parcel mail n.a.

Express mail n.a.

Source: no figures available.


New services

Polish Post is developing mobile banking service for its customers. Under the new service

the customer will be able to manage his account via mobile phone, make transfers, verify

account balances and make small payments for, for instance, parking. The service will be

launched this year. This is considered as a major competitive strategy by the postal

company to stay active in the postal delivery.20

1.5 Market structure and competition

1.5.1 National postal operator/Universal Service Provider

The current national postal operator is Polish Post, which was established in 1991 by

splitting the Office of Post and Telecommunications into postal and telecommunications

units. Since 1997, Polish Post holds the status of state-owned public utility.

Implementation of the ‘Strategy for Development of Polish Post for 2004-2006’

transformed the operator into a holding company. The current government led by Mr.

Tusk is planning to commercialise the Polish Post and sell (a part of) the stocks,

according to the announcement of the Vice President of the Sejm-Commission for

Infrastructure.21

In the same press release mention is made of the 105.000 employees of

Polish Post demanding a majority of the stocks as preference shares.

The (legal) preparations for the commercialisation of Polish Post started in March 2007.

On 27 March 2007, the Council of Ministers adopted the draft ‘Act on Commercialisation

of the State Enterprise of Public Utility Polish Post’, prepared by the Ministry of

Transport. Polish Post will be converted into a joint stock state treasure enterprise called

‘Polish Post JSC’. The commercialisation will be the first stage of property

transformation of the company.22

The state-owned Polish Post is composed of the following entities:

20

Datamonitor (2008). 21

Infoside (2008). 22

Ministry of Infrastructure (2007).


• Bank Pocztowy S.A;

• Pocztylion-Arka Powszechne Towarzystwo Emerytalne S.A. (a pension fund);

• Pocztowa Agencja Usług Finansowych S.A. (a financial services company);

• Post Media Serwis Sp. z o.o.;

• POSTDATA S.A.;

• Pocztowe Towarzystwo Ubezpieczeń Wzajemnych (a mutual insurance association).

From an organisational perspective, PPUP Poczta Polska consists of the general

directorate, the postal services centre, the licensed services centre, the logistics centre, the

postal network centre, the information technology centre, the infrastructure centre, the

accounting centre, the financial services centre, the security management centre and the

postal order centre. Most if them also have regional branches.23

Postal network

The UKE reports that at the end of 2007 there were 10,235 postal outlets in the area of

Poland. Polish Post holds 8,692 of these outlets (4,624 in villages, the others in cities),

whereas private operators hold the other 1,543 outlets. UKE stresses that outlets of

private operators are mostly (1,505 out of 1,543) located in urban areas and the number of

outlets operated by private operators in rural areas is insignificant.24

This is reflected in

the following table (Table 0.17).

Table 0.17 Postal network of the national postal operator

Polish Post 2007

Number of post offices

- Number of post offices and branch post offices

- Post offices only

8,692

- 5,761

- 2,931

Number of street letter boxes 55,138

Source: UKE (2008a and 2008b); ECORYS questionnaire – NRA.

In 2006, Polish Post realised a total volume of 3.1 billion items. In 2007 they generated a

turnover of PLN 4.6 billion (€ 1.2 billion) and delivered circa 2.9 billion items. Within

the universal service they delivered 1.9 billion items and realised a turnover of PLN 4.2

billion (€ 1.11 billion).25

The market share of Polish Post in the addressed mail segment in 2007 is still very high,

98.8% and 99.5% in the areas of items of correspondence and direct mail, respectively.

The estimated market share of Polish Post in the segment for unaddressed mail is 27.8%

and in parcels 46.1%.26

Degree of vertical and horizontal integration

According to our information, Polish Post has no alliances or partnerships with other

(foreign) postal operators.

23


UKE (2008a). 25

UKE (2008a). 26

UKE (2008a) and (2008b).


1.5.2 Competitor postal operators

Between 1996 and 2007, the number of private operators has increased more than tenfold

(from 15 to 164). None of these operators, however, has, yet, posed a real challenge to the

position of Polish Post.27

Five of these alternative operators are allowed to provide

services that are part of the universal service (they have an A-license).28

However, in

practice these parties do not offer these services. 29

Information (in English) about these companies is difficult to find.

Integer.pl

Integer.pl, a distribution group, operates InPost. It states to be the first independent postal

operator that performs business activities throughout the country. They claim to be a

market leader in respect of distribution of addressed and non-addressed advertising letters

and to deliver 50 to 70 million leaflets and advertising materials every month, resulting in

a volume of 600-840 million items per year. Their sister organisation Integer courier

delivers parcels in 500 cities in Poland. Integer.pl employs in total circa 7,300 people.

According their website they planned a share issue on the Warsaw Stock Exchange in

2007, but it is not clear whether this has been implemented.30

According to the NRA (see

next table) they delivered in 2006 circa 632 million items and employed circa 131 people.

27

UKE (2007b), p. 101-103. 28

These five are: Kolporter Logistyka, Wava, Indesys Dominik Steinhauf, Działalność Usługowa Jerzy Jaworski and

Dystrybucja Polska; see: http://www.bip.uke.gov.pl/marta/resultRop.vm. 29

UKE (2008a); ECORYS questionnaire – NRA. 30

Website Interger.pl.


Table 0.18 Overview of main competitors on the postal market (2006)

Postal

operator

Market Volume mail

/ Turnover

mail

# of

employees

Service level

(number of

deliveries per

week)

Coverage

I.D. MARKETING Unaddressed mail 763 million items 2,156 n.a. whole country

INTEGER.pl

(InPost)

Unaddressed mail,

direct mail, parcels

632 million items 131

(7,300 for the

group)

n.a. whole country

Dystrybucja

Polska

Unaddressed mail 383 million items 170 n.a. whole country

Pro Direct

(Now: ABC Direct

Contact)

Unaddressed mail 172 million items 541 n.a. whole country

ABC Direct

Contact

Unaddressed mail n.a. n.a. n.a. n.a.

UPS Polska Parcels, express,

cross-border

n.a. n.a. n.a. n.a.

DPD Parcels, express,

cross-border

n.a. n.a. n.a. n.a.

GLS Poland Parcels, express,

cross-border

n.a. n.a. n.a. n.a.

Opek Addressed direct

mail, parcels,

cross-border mail

n.a. n.a. n.a. n.a.

TNT Express

Worldwide (PL)

Parcels, express,

cross-border

n.a. n.a. n.a. n.a.

DHL Express (PL) Cross-border n.a. n.a. n.a. n.a.

Source: ECORYS questionnaire – NRA; NRA (2007b) and UKE (2008a and 2008b), p. 28 (table 8-9).

Note: employment reported in headcount at the end of 2006.


Addressed mail

There are five companies who are allowed to operate within the universal service apart

from PP. However, in practice they do not provide these services. In their 2007 market

assessment, the NRA indicates that nearly all alternative operators are active within the

‘correspondence’ area.. However, this also includes courier services.31

No operator can be

seen as a main competitor for Polish Post, most of them are operating on a local basis.

Parcel and express

Beside the large international operators like UPS, DPD, GLS Poland, DHL, TNT and

Spring, most registered (domestic) postal operators are active in the express market (e.g.

31

UKE (2008a), table 8 and 9 (Ranking the non-public operators). Items of correspondence are defined (article 3-22 Postal

Act 2003) as information on any kind of physical medium including relief print, with the address indicated by the sender on

the item, excluding books, catalogues, newspapers and magazines.


InPost, Opek). In terms of both volume and turnover UPS, DPD, GLS Poland and TNT

Express are the largest alternative operators for parcel and express services (no individual

figures available).32

The market share of all these alternative operators is 53.9%.

Cross-border mail

As mentioned before, Polish Post is the dominant operator on the market (market share of

circa 95%), while also international operators like TNT, DHL and UPS are active on the

Polish market. Again, in terms of both volume and turnover UPS, DPD, GLS Poland and

TNT Express are the largest alternative operators for cross-border services (no individual

figures available).33

Unaddressed mail

In the unaddressed segment, several operators are active and gained substantial volumes.

Parties like I.D. Marketing, Integer.pl, Dystrybucja Polska and Pro Direct gained a total

volume of 1.9 billion unaddressed items and employ around 3,000 people. Their joined

market share is circa 72%, but this may actually be higher as registration is not

compulsory for this service.34

1.5.3 Competition

The alternative operators delivered in 2007 2.3 billion items (out of 5.1 billion items),

especially unaddressed mail (see next table).

Table 0.19 total volume of the alternative operators (in million € and million items)

Turnover 2007 Volume 2007

Addressed items 1,556.4

(€ 411,3)

79.6

Unaddressed mail 110.1

(€ 29.1)

2,309.3

Total 1,666.5

(€ 440.5)

2,388.9


Note: Addressed items includes items correspondence, addressed advertising and parcels. Used exchange

rates: € 1,- for 4.023 PLN (2005), 3.8959 CZK (2006) and 3.7837 (2007), based on Eurostat averages

(Euro/ECU exchange rates - Annual data).

The NRA indicates that the 15 largest alternative operators handle 99.8% (in volume,

97.6% in turnover) of the total volume and turnover (including unaddressed mail).

Without unaddressed mail these figures are respectively 96.2% and 98.5%.35

The incumbent has been facing no real competition in the addressed mail segment

(market share of circa 99-100%) and most probably nothing is going to change until the

32

UKE (2008a), table 9 (Ranking the non-public operators). 33

UKE (2008a), table 9 (Ranking the non-public operators). 34

UKE (2008b). 35

UKE (2008a), table 9 (Ranking the non-public operators).


market is fully liberalised. The most severe competition is observed in the segment of

express services and to a lesser extent in the parcel and unaddressed segments. This is

shown in Table 0.20 and Table 0.21.

Table 0.20 Number of competitors and degree of competition (2005)

Postal product Market share USP Number of competitors Concentration ratio

C3

Bulk mail and consolidation n.a. n.a. n.a.

B2B non-bulk mail n.a. n.a. n.a.

Individual item mail n.a. n.a. n.a.


- transactional mail

- direct mail

98.78

99.53%

99.92%

Mainly locals

C1: close to 100%

Cross-border mail n.a. n.a. n.a.

Unaddressed mail n.a. n.a. n.a.

Parcel mail n.a. n.a. n.a.

Express mail 15.6% n.a. n.a.

Total 113 Non-USP registered

Source: ECORYS questionnaire – NRA.

Note : n.a. is not available.

Table 0.21 Number of competitors and degree of competition (2007)

Postal product Market share USP Number of competitors Concentration ratio

C3

Bulk mail and consolidation n.a. n.a. n.a.

B2B non-bulk mail n.a. n.a. n.a.

Individual item mail n.a. n.a. n.a.


- addressed direct mail

98.8%*

- 99.5%

75

C1: close to 100%

Cross-border mail 95% 27 (e.g. FedEx, UPS,

DHL Global Mail, TNT

and Spring)

C1: 95%

Unaddressed mail 27.8% 17 (e.g. I.D. Marketing,

Integer, Dystrybucja

Polska and Pro Direct)

C1: 28%

Parcel mail 46.1% 47 C1: 46%

Express mail n.a. n.a. n.a.

Total 164 non-USP registered

(100 of them operated)

Source: ECORYS questionnaire – NRA; UKE (2008a), p. 40 (table 25-28), in volume and UKE (2008b).

Note: * USP’s market share comparing to whole market volumes (USP + all non-USP).



1.5.4 Competition issues

According to the NRA the fundamental formal barrier to entry is the reserved area (50g),

which limits the entry of new operators in the addressed mail segment. In addition, the

competitors are subject to VAT while the incumbent is relieved from this tax.

Furthermore, the NRA indicates that in general the market is not yet well developed

compared to the leading economies in Europe. There is, for example, no access to

letterboxes and to sorting centres (no consolidators). Competitors have no access to the

address database of the incumbent either.36

State aid

A press release dated 25 April 2007 makes note of the fact that Poland had agreed to

abolish by 30 June 2008 the unlimited state guarantee currently enjoyed by Polish Post.

Under this guarantee the state has responsibility for liabilities entered into by Polish Post

and the fact that the guarantee was unlimited in duration, in amount and covers all

liabilities, allowed Polish Post to obtain finance on more favourable terms, thus giving it

an advantage over its competitors and distorting competition in the single market,

according to the European Commission.37

Access to letterboxes

Nowadays only the postmen of Polish Post have a key to open letterboxes from behind to

deliver the mail. Inhabitants can open the letterboxes from the front side with an

individual key, which can be obtained from Polish Post. The lack of accessibility of

letterboxes can hinder the development of competition.

As a prelude to the liberalisation of the postal market in Poland, owners of estates and

houses are now obliged to install new letterboxes, according to requirements determined

in the Ordinance on letterboxes. These new boxes should be exchanged by August 2008.

The situation for entrants will most likely improve the moment there is access to the

letterboxes; the new letterboxes ensure competitors free access to the last mile. Different

estimations expect about 3.5 up to 6 million new letter boxes. The change of letterboxes

differs from city to city: in Krakow only 15% of the 306,900 letter boxes have been

changed, where as in Kutno 40% of the 21,600 letter boxes have already been changed.38

Polish Post indicates that they do not see other formal obstacles for competition apart

from the temporary ‘keys for the letterboxes’ problem.39

1.5.5 Results of competition.

Some considerations of the NRA40

Between 1996 and 2007, the number of private operators has increased more than tenfold.

None of these operators, however, has posed a real challenge to the position of Polish

36


Commission (2007). 38


ECORYS questionnaire – Polish Post. 40

Based on UKE (2007b), p. 101-103, literally and UKE (2008a).


Post. This growth can be felt predominantly by business customers in urban areas as

private operators are active only in cities and mainly target bulk senders.

The regulatory authority, UKE, reports a stabilisation of market indicators, e.g. the

number of registered operators, the number of services provided by them and the total

volume of postal services. However, UKE still assesses the development of competition

in the Polish postal market positively. In a 2006 audit of alternative postal operators, the

UKE inspected 49 postal operators, whereof 46 operated on a national or local scale,

while 3 had nationwide and international coverage. With respect to results of competition,

its key conclusions were:

• The undertakings operating in Poland and in international service clearly focus on

parcel service;

• Currently, there is one operator in the process of organising its postal business. This

operator intends to offer postal services in the area of items of correspondence in the

entire national territory and establish a nationwide network of local outlets (branches

and customer service offices). Judging by the density of this network, the operator

intends to provide these services on a massive scale. However, it would appear that

the fact that this operator uses special envelopes (weighted with a metal seal),

currently prevents any large-scale activity due to the cost of such envelopes and the

inconvenience of their usage.

Local operators are interested almost exclusively in pursuing postal activities in the area

of the lowest weight category of items of correspondence, i.e. the area set out in the

Postal Law as the area reserved for the public operator, in which other operators may

operate subject to them charging higher prices (being 250% of the PLN 5.00 charged by

the public operator). The local operators inspected want to compete with the public

operator in the reserved area. On some occasions they do it in violation of the provision

cited above or bypass its provisions by using non-standard packaging (weighing about 50

grams). The current potential of the operators inspected points to a relatively small scale

of their activities.

A reason for this persistent lack of competition might be that the government has only

dropped the threshold for the reserved area to 50 grams as of January 2006. The 50 g

threshold has been still binding what effectively prevents competitors from the full

market entry. Moreover, the lack of a level playing field in the Polish postal market might

also provide some explanation.

Observations ECORYS

The Polish market shows a strong development in volume growth, especially in the

unaddressed mail market. Since 2003 the total number of items grew by 94% (mainly

unaddressed mail) and total turnover increased with circa 8%. It is interesting to note that

the total number of alternative operators increased very sharply (more than tenfold).

However, the large majority of these operators are active in the local market and the main

operators are mainly active in the segments for unaddressed mail, cross-border mail,

parcel mail and express.

In 2005 ECORYS concluded that Polish Post dominated the C2C, C2B and B2C

segments due to the density of its network, whereas express and logistic service operators


concentrate on the B2B segment. It was not expected that competition would take place in

the field of universal services in the near future. However, it was also noted that full

liberalisation of the universal service provision could result in the loss of a large part of

market share in big cities (the competing postal operators were the strongest in the big

cities: 80% of the revenues of the Polish Post originate from 15 cities). These

observations are still mostly valid.

In the addressed mail segment (including addressed direct mail) the market share of

Polish Post is above 99%. The main barrier to competition is the reserved area and the

lowering of the threshold in 2006 (from 100g to 50g) seems to have had hardly any effect

on the level of competition in the addressed mail segment. There are no indications that

this will change fundamentally before full market opening in 2013.

In the market for cross-border mail Polish Post has a market share of 95%.

In the other segments Polish Post faces more competition than in the addressed mail

market. In the unaddressed mail segment, several parties such as I.D. Marketing, Integer,

Dystrybucja Polska and Pro Direct distributed 1.5 billion items in 2007 and have gained a

market share of 72%. Large international operators like TNT, DHL and UPS are active in

parcels and express and compete with Polish Post (e.g. the market share of Polish Post in

parcels is 46% in volume).

Access to the letterboxes by competitor postal operators seems to be a major problem, but

the regulation concerning the installation of new letterboxes may provide a solution.

Further, the VAT exemption for Polish Post is a (major) barrier to start addressed mail

delivery.

1.6 Customer needs

Between 11 and 29 October 2006, the UKE assessed the degree of satisfaction of

customer’s needs.41

In October 2006 a consumers´ satisfaction research (study of satisfaction in regard of

customer needs) was carried out (commissioned by UKE) with regard to the quality of

universal postal service. The investigation differentiated between private customers and

business customers. As the research embraced the scope of universal postal service it

practically referred to the services of Polish Post. The most important results were:

• with respect to private customers, the survey showed that 83% of the customers of

Polish Post were satisfied with services in the area of the universal service, it should

be noted that these customers mostly use its letter service;

• registered letters are sent more rarely than economy letters because of the price;

• customers are rather unhappy about the time it takes to be served and long queues in

Polish Post outlets. For 76 percent of the private customers, Polish Post is also a

41

The sample size of this study is 1,000.


financial intermediary. The waiting time is also a reason for which part of the Poles

opt out of the financial transactions;

• Business customers, on the other hand, were similarly satisfied with all PP’s services

as with competitors’ services, though satisfaction with respect to quality was higher

towards competitive courier services. Business customers were also generally

satisfied with letter services, though some areas were indicated to need improvement

(e.g. returned mail and transit times).

In the overall conclusion the research confirmed a moderate positive level of satisfaction

with services of Polish Post. The parcel services were better assessed than letter services.

In view of respondents, letter mail is rather expensive; some areas of postal activity

features unsatisfactory quality, such as transit time and re-address procedures.42

In another monitor of procedures and the manner of handling complaints, the UKE found

that the highest number of complaints concerned registered mail, whereas the lowest

number of complaints concerned postal items with declared value. Only 5 percent of the

inspected complaints contained damages of postal items, theft, and other reasons (e.g.

breach of confidentiality of correspondence, delayed delivery of postal items).43

42


UKE (2007b), p. 102.


1.7 Price performance

1.7.1 Tariffs

In Table 0.22 the public tariffs of several postal products are presented. All 2007 prices

increased compared to 2005, the tariff of parcels, for example, with nearly 19%.

Table 0.22 Public tariffs (in PLN)

Postal product Definition 2005 2006 2007

Letter post 1st class USP tariffs for domestic 20g letter of fastest

standard category

2.00

(€ 0.50)

2.00

(€ 0.51)

2.10

(€ 0.56)

Letter post 2nd

class USP tariffs for domestic 20g letter of second

fastest standard category (if applicable)

1.30

(€ 0.32)

1.30

(€ 0.33)

1.35

(€ 0.36)

Letter post cross-

border

USP tariffs for cross-border 20g letter of

fastest standard category

3.45

(€ 0.86)

3.55

(€ 0.91)

3.55

(€ 0.94)

Parcels USP tariffs for a 5 kg domestic parcel (lowest

available public tariff)

8.00

(€ 1.99)

8.50

(€ 2.18)

9.50

(€ 2.51)

Parcels cross-border USP public tariffs for a 5 kg cross-border

parcel (lowest available public tariff)

69.00

(€ 17.15)

71.14

(€ 18.26)

71.14

(€ 18.80)

Registered item USP public tariffs for a registered item (lowest


3.50

(€ 0.87)

3.50

(0.90)

3.55

(€ 0.94)

Insured item USP public tariffs for an insured item (lowest


4.50

(€ 1.12)

4.50

(€ 1.16)

4.55

(€ 1.20)

Bulk mail, 20g USP public tariffs for a mailing of 500 items n.a. n.a. n.a.



Total

Source: ECORYS questionnaire – NRA.


Table 0.23 Public tariffs (in PPP)

Postal product 2005 2006 2007

Letter post 1st class 0.89 0.89 0.94

Letter post 2nd

class 0.58 0.58 0.60

Letter post cross-border 1.54 1.58 1.59

Parcels 3.56 3.77 4.25

Parcels cross-border 30.75 31.57 31.85

Registered item 1.56 1.55 1.59

Insured item 2.01 2.00 2.04

Bulk mail, 20g

Bulk mail, 100g

Bulk mail, 300g

Total

Source: conversion rate based on Eurostat data.


Evolution of public and special prices for main services

Beside the figures mentioned in the table, there is no information available concerning the

evolution of public and special prices for main services.

Affordability

There is no information available concerning the affordability of postal services or the

price of services relative to the income of low/average-income.

1.8 Employment aspects

1.8.1 Employment

In 2006, nearly 113,000 people (headcount) were employed in the postal sector (see Table

0.24).44

Circa 16% is working for alternative operators. Eurofound reports that

employment at Polish Post has remained largely constant over the past ten years and

estimates that its average employment over a 12-month period was in 96,999 FTE in

1996, 97,702 in 1998, 96,963 in 2002 and 96,110 in 2003. The UKE reported that

employment is still increasing, but at a low pace. Sixty percent of employees are

estimated to be female. 45

Table 0.24 Employment in the sector, in employees and [FTE]

Operator 2005 2006

Polish Post total

Polish Post- civil servant

Polish Post- flexible

94,033

No civil servant status

n.a.

95,016

No civil servant status

n.a.

CPO’s total 14,798 17,964

Total 108,831 112,980


Note: CPO’s total includes all non-USP employees; data in FTE not available.


In the next table, the development in employment since 2003 is shown. Since 2003 the

total number of employees increased by 15%.

Table 0.25 number of employees (2003-2007)

2003 2004 2005 2006 2007

Polish Post 100,760 100,138 100,049 101,146 100,423

CPO’s 4,702 8,595 14,798 17,964 21,246

Total (excluding unaddressed) 105,462 108,733 114,847 119,110 121,669


Note: figures at the end of the year.

44

ECORYS questionnaire – NRA, Polish Post. 45

Eurofound (2007).


1.8.2 Employment conditions

The Polish law sets the minimum monthly remuneration for full-time work at PLN 889 (€

228,-) in 2006 and at PLN 936 (€ 247,-) in 2007. The average remuneration in the

enterprise sector has been estimated by the Central Statistical Office to be PLN 2,758 (€,-

708) in 2006. With respect to Polish Post, Eurofound reports that average wage was PLN

3.028 (€ 777) as at December 2006. However, 27 percent of all employees (mostly

mailmen) were earning PLN 900 PLN (€ 231,-) per month, which is just above the

minimum wage in 2006.46

There were “wild strikes” between 10th and 27

th November 2006 in different regions.

They started in Gdansk and spread out over the whole country; at the end more than

25,000 of the 50,000 postmen were on strike. The demand of the strikers was (amongst

others) focused on higher salaries, fixed working hours and contract conditions.47

At the

18th of December the Minister of Traffic engaged in the negotiations between Polish Post

and the unions (Solidarnosc).

The private competitor of Polish Post, InPost, which is already present in 71 towns of

Poland, pays their new employees 1,500 PLN (€ 385,-).48

Role of social partners, trade union, sector based collective agreements

There are eight union organisations active within Polish Post.49

Eurofound reports that

unionisation among Polish Post stands at approximately 60%, though despite this

relatively high rate, representation is rather fragmented and individual trade unions

sometimes compete with one another. Due to its dominant position, the collective

agreement in force within Polish Post is said to extend to approximately 90% of the

sector’s employees. No data is available about union membership at the privately-owned

operators. Further, there is no employers’ organisation in the Polish postal sector.50

Wages as proportion of total costs

No information is available concerning the wages as proportion of total costs.

46


The questionnaire of the Gdansk postmen from 13th of November 2006 mentioned: (i) rise of the wages for all postman up

to 2500 PLN respectively 1700 PLN for newcomers; (the average wage is 1,600 PLN and after tax and social fees 1,000

PLN), (ii) fixed labour-contract for newcomers after one year; (iii) postmen do not deliver unaddressed mail (bulk mail); (iv)

working hours are fixed on 8 hours and installation of a punch card; (v) payment of hours of overtime in accordance with the

law of labour; (vi) food and water in the offices, (vii) automatically adoption of the wages at the inflation rate, (viii) no

repressions of participants at protest actions. 48

Wildcat (2007), page 33-35. 49

(i) Inter-Employer Union Organisation of the Solidarity Independent Self-Governing Trade Union (Międzyzakładowa

Organizacja Związkowa Niezależnego Samorządnego Związku Zawodowego ‘Solidarność’); (ii) Free Trade Union of Postal

Employees (Wolny Związek Zawodowy Pracowników Poczty, WZZPP); (iii) Federation of All-Poland Alliance of Trade

Unions of Communications Workers (Federacja OPZZ Pracowników Łączności); (iv) Independent Self-Governing Trade

Union of Poczta Polska Postmen (NSZZ Listonoszy Poczty Polskiej); (v) Forum Nationwide Trade Union (Ogólnokrajowy

Związek Zawodowy Forum, FZZ); (vi) Postal Guard Nationwide Trade Union (Ogólnopolski Związek Zawodowy ‘Straż

Pocztowa’); (vii) Kontra Trade Union (Związek Zawodowy ‘Kontra’); (viii) Inter-Employer Free Trade Union of Poczta Polska

Employees (Międzyzakładowy Wolny Związek Zawodowy Pracowników Poczty Polskiej). 50

Eurofound (2007).


1.8.3 Productivity

No information is available concerning the productivity of Polish Post or the alternative

operators. Given the fact that Polish Post delivers 2.9 billion items (including letter mail,

parcels and express) and has circa 100,000 employees their rough productivity figure is

29,000 items/employee.

1.9 Technological developments and environment

1.9.1 External

There is no information available concerning the external technological developments, for

example, related to the percentage of letter mail in the communications’ market or the

turnover realised by e-commerce.

An interesting example in this respect is the development of mobile banking service for

its customers by Polish Post (mentioned before). The fact that customer will be able to

manage there account via mobile phone, make transfers, verify account balances and

make small payments like parking is an interesting example of the integration of (postal)

financial services and emerging technological development s in the electronic

communication market.

1.9.2 Internal

There is no information available concerning the percentage of letter mail that is

automatically processed.

Polish Post invested in a sorting centre in Lublin of about € 20 million. In this centre it is

planed that 600 employees shall sort 500,000 letter-mail and 20,000 parcels per day. The

centre shall commence in autumn 2009. Actually Polish Post has 10 sorting centres

(Warsaw, Krakow, Wroclaw, Poznan, Szczecin, Gdansk, Lodz, Katowice, Lublin,

Olsztyn).

1.9.3 Environment

There is no information available concerning the postal sector developments in terms of

environmental issues.

1.10 Sources

• European Commission (2007). State aid: Commission takes note of abolition of

unlimited state guarantee for Polish Post Office, press release by the European

Commission, 25 April 2007.


• Datamonitor (2008). Publication by Datamonitor of 10 March 2008, see

<www.datamonitor.com >.

• ECORYS (2005a). Development of competition in the European postal sector, study

for DG Internal Market, European Commission, July 2005.

• Eurofound (2007). Industrial relations in the postal sector – Poland, study for the

European Foundation for the Improvement of Living and Working Conditions by

Jacek Sroka, November 2007.

• Infoseiten (2008). Polnische Post vor Privatisierung, news item 5 January 2008, see

• < www.infoside -polen/newslog>.

• Ministry of Infrastructure (2007). The Government adopted the draft Act on

Commercialisation of the Polish Post, press release number 51 (138), 27 March 2007.

• Polish Post (2006). Annual report 2005, report by the national postal operator, 2006.

• Polish Post (2007). Annual report 2006, report by the national postal operator, 2007.

• UKE (2006). Annual report 2005, report by the national regulatory authority, 2006.

• UKE (2007a). Transit times for postal items in 2006, report by the national regulatory

authority, January 2007.

• UKE (2007b). Annual report 2006, report by the national regulatory authority, 2007.

• UKE (2007c). The postal market assessment for the year 2006 (in Polish), report by

the national regulatory authority, 2007.

• UKE (2007d). The postal market assessment for the year 2006, English summary of

UKE (2007b) by the national regulatory authority, August 2007.

• UKE (2007e). Transit times for postal parcels, report by the national regulatory

authority, December 2007.

• UKE (2008a). The postal market assessment for the year 2007 (in Polish), report by

the national regulatory authority, May 2008.

• UKE (2008b). The postal market assessment for the year 2006, English summary of

UKE (2007b) by the national regulatory authority, June 2007.

• WIK-Consult (2006). Main developments in the postal sector (2004-2006), study for

DG Internal Market and Services, European Commission, May 2006.

• Wildcat (2007), Wildcat No: 78, winter 2006/2007 p. 33-35.