1 D DECISION 1(18) Date Our reference File appendix 14 October 2011 File ref.: Postal Affairs Department Åsa Gustafsson +46 (0) Posten AB SE Stockholm Licence conditions for Posten AB (corporate ID no ) The matter Conditions under Chapter 2, Section 4 of the Postal Services Act (2010:1045). Decision of the Swedish Post and Telecom Authority Posten AB s licence to conduct postal operations shall, pursuant to Chapter 2, Section 4 of the Postal Services Act, be subject to the conditions shown in this decision. If Posten AB contracts another party to completely or partly provide services covered by the licence, Posten AB shall ensure that the services are performed in accordance with the Postal Services Act, the Postal Services Ordinance, regulations issued under the Postal Services Act and also the licence conditions shown in this decision. Background Issues relating to licences shall be decided by the authority appointed by the Government ( the licensing authority ) (Chapter 2, Section 2 of the Postal Services Act). The Swedish Post and Telecom Authority () is the licensing authority under the Postal Services Act (Section 2 of the Postal Services Ordinance (2010:1049)). A licence to conduct postal operations may be granted subject to conditions pursuant to the more detailed provisions of Chapter 2, Section 4 of the Postal Services Act. The Swedish Post and Telecom Authority decided on 13 March 1997 ( File ref. 97/4769) that Posten AB shall be granted a licence to conduct postal operations under Section 4 of the Postal Services Act (1993:1684). On 30 September 2010, issued licence conditions under Chapter 2, Section 4 Swedish Post and Telecom Authority Postal address: Visiting address: Telephone: +46 (0) Box 5398 Valhallavägen 117 Fax: +46 (0) SE Stockholm
2 2(18) of the Postal Services Act (2010:1045), which applied up to and including 30 September 2011 (File ref ). On 30 September 2011, issued interim licence conditions that ceased to apply on 14 October 2011 (File ref ). hereby issues licence conditions to apply from and including 15 October LICENCE CONDITIONS 1. Provision of the universal postal service 1.1 Obligation to provide the universal postal service. Posten AB shall provide the universal postal service, the scope and implementation of which is indicated by Chapter 3, Sections 1 and 2 and Section 6 of the Postal Services Ordinance. According to Chapter 2, Section 4, item 2 of the Postal Services Act, a licence to conduct postal operations may be issued subject to conditions concerning the obligations of the licence holder to provide the entire or parts of the universal postal service in accordance with Chapter 3, Section 1 and to satisfy in a particular manner that prescribed there and by Chapter 3, Section 2. may for one or more licence holders link the licence to conduct postal operations with the above-mentioned conditions [Section 5 of the Postal Services Ordinance (SFS 2010:1049)]. makes the assessment that a provider of the universal service should be appointed so that all of the requirements imposed on this service will be satisfied (see Government Bill 2009/10:216, p. 52 f). This assessment has been made, among other things, in light of the fragility of the limited competition situation prevailing in the Swedish postal market, which does not allow to refrain from appointing a provider of the universal postal service. has also made the assessment that it is Posten AB that should provide the entire universal postal service in order to secure requirements for quality, national coverage, accessibility, pricing and reporting. There are a number of rules in the Postal Services Act that are only applicable to an appointed provider.
3 3(18) considers that these rules must be applied to Posten AB in order to maintain the above-mentioned requirements. A description is provided in Government Bill 2009/10:216 of among other things: overall postal service policy objectives; what is deemed to constitute the universal postal service; and requirements in respect of the service level to be offered for the service. Like the Government, does not consider that there is any reason to amend the scope of the universal postal service, for which reason the current scope shall remain (cf. Government Bill 2009/10:216, p. 45). 1.2 Clearance and delivery Posten AB shall ensure that postal items weighing up to and including 20 kg are cleared and delivered every normal Monday to Friday. In this context, weekends and public holidays also include Midsummer s, Christmas and New Year s Eve. The density of points of contact and access points shall take account of the needs of users. The universal service should have the same scope and should assure all users a service of the same quality as to date. This is indicated by Government Bill 2009/10:216, p. 42 ff. The basis is that the service level in respect of letterboxes and service points should remain unchanged compared with the preceding year, retaining accessibility throughout Sweden. (Cf. Posten AB s reporting obligation under Clause 4.2.) (Chapter 4, Section 2, item 2 and Chapter 3, Section 1, items 1 and 2) 1.3 Routing times At least 85 per cent of letters deposited for overnight delivery before the latest point in time for deposit and for which the sender has paid the price applicable for overnight delivery shall have been distributed within Sweden on the
4 4(18) following working day through the agency of Posten AB and irrespective of where they were deposited in Sweden. At least 97 per cent of the letters shall have been distributed within three working days. The common European Standard EN (Postal services Quality of service Measurement of the transit time of end-to-end services for single piece priority mail and first class mail) 1 shall apply when measuring routing times for individual mail items. The purpose of this condition is to ensure that routing times for letters within Sweden are adapted to the base level required for cross-border mail under the Postal Services Directive. When assessing whether this condition has been fulfilled, assumes that the methods for measuring routing times, which Posten AB applies at the time the licence conditions enter into force, are satisfactory. These methods may not be changed without the written consent of. (Chapter 2, Section 4, item 2 and Chapter 3, Section 1, item 3 of the Postal Services Act together with Section 6 of the Postal Services Ordinance) 1.4 Prices Posten AB shall provide the universal postal service at prices that are reasonable, transparent, non-discriminatory and cost-oriented. It should be possible for everyone to receive postal items conveyed at reasonable prices in accordance with Chapter 1, Section 2 of the Postal Services Act. Reasonable prices means that the prices should not be onerous. Requirements for prices to be transparent and non-discriminatory were incorporated into Chapter 3, Section 2 of the Postal Services Act in The meaning of this is shown by Government Bill 2009/10:216, p. 55 ff. In the opinion of, transparent prices means, for example, that the public price lists should cover all of the volume intervals applied by Posten AB and that all 1 The European Committee for Standardization (CEN) is responsible for this standard
5 5(18) performance-based discounts offered to users are reported transparently (see also items 1.5 and 1.6 below). Non-discriminatory pricing means, for example, that prices and other conditions shall be applied equally in relation to the various parties to the contract, both actual and potential parties. Such parties to the contract may, for example, be corporate customers, consolidators of mail for various users and other postal operators. Discounts and other special conditions shall thus be offered to all users on the same terms. The term cost-oriented prices is defined in p. 58 ff of the same Government Bill. In the opinion of, cost-oriented prices in the 2010 Postal Services Act shall be understood to be the same as prices geared to costs under the 1993 Postal Services Act. There is also a requirement linked to cost orientation for pricing to promote the effective provision of a universal postal service (Chapter 3, Section 2 of the Postal Services Act). In order for to be able to effectively monitor compliance with the rules and regulations for pricing, Posten AB shall show the costs on which these prices are based (Chapter 3, Section 2 of the Postal Services Act). The principles for costings and reporting are set out in items 6.1 to 6.3 of these licence conditions. (Chapter 2, Section 4, item 2 and Chapter 4, Section 2 of the Postal Services Act) 1.5 Transparency relating to prices and other conditions Posten AB should make available to the public the general conditions for those services included in the universal postal service. Prices and any discounts shall be offered to anyone who satisfies the conditions therefor and the said conditions should be publicly available. A user who requests price information (with or without discounts) is entitled to receive this information in writing on request. In the same way, a user is entitled to receive a written contract on request.
6 6(18) According to Article 6 of the Postal Services Directive, 2 Member States shall take steps to ensure that users are regularly given sufficiently detailed and up-to-date information by the universal service provider(s) regarding the particular features of the universal services offered, with special reference to the general conditions of access to these services as well as to prices and quality standard levels. In the opinion of, this information should be published in an appropriate manner and be easily accessible for customers (Chapter 3, Section 1, item 6 of the Postal Services Act). In addition, the principle of nondiscrimination shall be observed under Chapter 3, Section 2 of the Postal Services Act. This condition means, among other things, that Posten s public price lists shall include all of the volume intervals applied by Posten AB. The requirement that users which in practice means those Posten AB customers that have an individually negotiated agreement are entitled to be offered prices and discounts in writing and similarly a written contract may be viewed as a matter of course, although it has been specified in the licence conditions for the sake of clarity. (See Chapter 2, Section 4, item 2, Chapter 3, Section 1, item 6 and Chapter 3, Section 2 of Postal Services Act) 1.6 Discounts and other special conditions, etc. Posten AB shall transparently report on the principles forming the basis of the calculation of special prices (if these deviate from the official price list) and performance-based discounts. In the same way, Posten AB shall also transparently report on the principles for other special conditions that deviate from the official conditions/general conditions. Posten AB shall thus transparently report on all performance-based discounts that users can receive, stating: 2 Directive 97/67/EC of the European Parliament and of the Council of 15 December 1997 on common rules for the development of the internal market of Community postal services and the improvement of quality of service, last amended by Directive 2008/6/EC of the European Parliament and of the Council.
7 7(18) the term of the discount, the maximum discount, the interval applicable to various stages of discount (provided such apply). Any surcharges shall be transparently reported in a corresponding way. This information shall be provided on Posten AB s website. If users are offered discounts other than those published on Posten AB s website, these shall be reported in writing to no later than on the 5 th of the following month, stating the name and organisation ID number of the user, together with the reasons for and amount of the discount. If a user is offered special conditions that are not displayed on Posten AB s website, these shall be reported in writing to no later than on the 5 th of the following month, stating the name and organisation ID number of the user. If Posten AB applies special prices and other special conditions, these shall be transparent and non-discriminatory according to Chapter 3, Section 2, third paragraph of the Postal Services Act. It is stated on page 57 of Government Bill 2009/10:216 that all users are entitled to such special prices and special conditions if they satisfy the preconditions therefor. The principles applicable to prices, discounts and other conditions, as well as combinations of these, are therefore required to be transparently and clearly reported to users. Parameters that may form part of the assessment include volume, level of pre-sorting and the point in time for deposit. Other parameters may also come into question, though only subject to the precondition that they can be justified in light of the impact they may have on the costs. The reason for specifying the maximum discount is that users can then at least assess the reasonableness of the discount that may be obtained under certain specified circumstances.
8 8(18) The reason for requiring the various intervals to be specified is that users should be aware that their discount may increase or reduce at a certain given point. On the other hand, there is no need for Posten AB to publish the exact prices in the various discount intervals but, as previously mentioned, Posten AB just has to specify the maximum discount for the highest interval. A user who wants to refer to the discounts offered may contact Posten AB s sales organisation to conclude an agreement regarding the discount/final price. The prices stated in the official price list are otherwise assumed to apply. As indicated by item 1.5, the user is entitled to receive this information in writing on request (both the quote and contract). The main principle is that all discounts and conditions shall be offered to all users on Posten AB s website. However, there may also be reasons to provide discounts (or other conditions) in other cases, for example for certain unique solutions. To avoid this possibility being abused, a report shall be delivered every calendar month to of each offer of this kind (including price, discount or special conditions that are not displayed on Posten AB s website). The full wording of the special conditions shall be reported. If the condition has only been issued verbally, the authority shall be specifically notified of this, including the meaning of the condition. The first report of discounts and special conditions that are not published on Posten AB s website shall be made no later than 5 th November 2011 and encompass decisions made from and including 15 October will deal with the information in accordance with the secrecy provisions applicable at any given time. (Chapter 2, Section 4, item 2, Chapter 3, Section 1 of the Postal Services Act and Chapter 3, Section 2 of the Postal Services Act) 2. Reliability 2.1 Privacy and security Posten AB shall ensure that:
9 9(18) a) addressed mail items are handled so that they are not damaged through external impact during handling or by the weather and wind b) mail items are handled observing established distribution procedures so that they are not unnecessarily exposed to unauthorised persons or left unattended in a way that entails a risk from the perspective of privacy c) the protection of the senders and recipients privacy shall be maintained by relevant staff having adequate knowledge of both the rules relating to the duty of confidentiality and the protection of privacy that the postal secrecy contained in Chapter 4, Section 8 of the Swedish Penal Code seeks to provide, and that d) the premises where addressed mail items are handled satisfy reasonable requirements in respect of security. These conditions entail a clarification of Chapter 2, Section 6 of the Postal Services Act. (Chapter 2, Section 4, item 1 of the Postal Services Act) 3 Dealing with complaints 3.1 Publishing complaints Each year Posten AB shall publish information about the number of complaints and how complaints have been dealt with. The information for a calendar year shall be published no later than 30 April of the following year. Chapter 2, Section 4, item 3 states that certain information about complaints shall be made public. In addition, complaints shall also be made public under Chapter 4, Section 12 of the Postal Services Act by the party appointed to provide the universal postal service. Making information public means that this information shall be published on Posten AB s website, so that it is easy for the general public to access the information. Posten AB should state when publishing how the term complaint has been defined.
10 10(18) 4. Disclosure requirements 4.1 Reporting changes to the organisation, amended conditions, operational disruptions, etc. Posten AB shall promptly notify of: all significant changes to the organisation, planned changes to the service conditions and prices, serious operational disruptions, for example, during clearance, distribution, sorting and transport, events, such as sabotage, theft, fire, fraud and the like. has an overall responsibility within the area of postal services and the area of electronic communications. 3 Within the area of postal services, the Government has assigned the authority to: promote the availability of a properly functioning universal postal service for everyone in accordance with the objectives set out in the Postal Services Act, continuously monitor developments and monitor that postal services satisfy public needs, promote effective competition, monitor price trends, consider issues concerning licences and exercise supervision under the Postal Services Act, and also promote the efficient operation of the postal market from the perspective of both consumer and regional growth policy. needs to have access to Posten AB s strategic documents and to have information about how the management is working to realise these plans to enable the authority to fulfil its assignment. Posten AB shall therefore keep informed about the operation's organisation, content and such individual circumstances or events that may have an impact on the reliability or quality of the operation. s assignment to supervise the Postal Services Act includes monitoring prices and also applying special conditions. The 3 Ordinance (2007:951) with instructions for
11 11(18) authority therefore needs to have information about planned changes to service conditions and prices without delay in order to fulfil its assignment. (Chapter 2, Section 4, items 1 and 2, Chapter 2, Section 6 and Chapter 3, Section 2 of the Postal Services Act) 4.2 Reporting service points, etc. Posten AB shall report the following to upon request and usually once per year: the number of service points, the type of service point, and the number of public letterboxes. Posten AB shall report the following to in good time: all planned withdrawals of letterboxes and service points (points of contact and access points), indicate the alternatives being offered to those users affected, and also report on other significant changes to the service network. The alternatives notified to those users affected shall be reasonable on an overall assessment. The universal service should have the same scope and assure all users of a service of the same quality as to date. This is indicated by p. 42 ff of Government Bill 2009/10:216. The density of points of contact and access points shall take account of the needs of users under Chapter 3, Section 1, item 2 of the Postal Services Act. (Chapter 2, Section 4, item 2 and Chapter 3, Section 1, item 2 of the Postal Services Act) 4.3 Reporting exemptions from the 5-day rule Posten AB shall make an annual report to regarding the number of residential customers that do not have five day deliveries. However, the report
12 12(18) shall not include those residential customers who are willing not to have fiveday deliveries. The universal service means, for example, that a distribution shall take place on every working day and at least five days a week for recipients. Special circumstances or geographical conditions may result in the licensing authority granting an exemption. In order to protect the quality of the universal service, it is important that exemptions are granted restrictively. For this reason, there should be no increase in the number of residential customers without a daily service. (Chapter 2, Section 4, item 2 and Chapter 3, Section 1, item 1 of the Postal Services Act) 5. Postal services for persons with functional impairments Posten AB shall consider the need of special postal services for persons with functional impairments. Posten AB shall submit a tender with cost-oriented prices in the event that implements a procurement of postal services for persons with functional impairments. Posten AB shall consider in its operation the need of special postal services for persons with disabilities (Chapter 2, Section 4, item 4 of the Postal Services Act). This requirement covers: an extended service outside the urban area; acting as an intermediary for the dispatch of literature for people with visual impairments; and postal services that are of particular importance for persons with disabilities. Extended postal service means that, on account of age or functional impairment, a postal service is provided right up to the home of persons who normally have their post distributed a certain distance from their home.
13 13(18) The meaning of cost-oriented prices is indicated by Chapter 3, Section 2 of the Postal Services Act and page 59 of Government Bill 2009/10:216. The above-mentioned services shall be dealt with as special arrangements via a procurement procedure. This licence condition secures the need of special postal services for persons with functional impairments since there will in all circumstances will be at least one tenderer for any procurements and it also clarifies that this tenderer cannot charge excessive prices for the services offered. In this context, persons with disabilities also refers to persons over the age of 80. It is stated in the comments to the Act that Chapter 2, Section 4 corresponds to Chapter 5 b, Section 4 of the 1993 Postal Services Act. More detailed reasons are shown in the travaux préparatoires to this Postal Services Act (Government Bill 1997/98:127, p. 38 f and 48). The need to secure postal services for persons with functional impairments still applies. 6. Costings and reporting 6.1 General Posten AB s reporting and costings shall allow prices for services included in the universal postal service to be checked for whether they are reasonable, nondiscriminatory and cost-oriented. In this item 6, universal postal service means the conveyance of letters and other addressed mail items that weigh up to and including 20 kg. This condition has been imposed to enable to verify that Posten AB is satisfying the conditions under item 1.4 pursuant to Article 12 of the Postal Services Directive. (Chapter 2, Section 4, item 2 and Chapter 4, Section 2 of the Postal Services Act)
14 14(18) 6.2 Costing system Posten AB shall report costs and revenues for each individual service included in the universal postal service in a documented and transparent costing system on the basis of consistently applied and objectively justifiable cost accounting principles. It must be possible to deduce costs and revenues from audited annual accounts. These shall state which allocators have been used and the amounts that are thereby allocated to the services affected. It shall thus be possible to calculate the cost of each individual service included in the universal postal service. Changes in relation to the previous year shall also be reported. All readjustment, development, and extraordinary items shall be clearly reported. The same applies to all group adjustments and other changes. For common functions relating to the operations in different countries, the allocation of costs and underlying principles for allocation between the respective country s operations shall be clearly reported. In the costing system referred to above, costs shall be allocated to each of the services in the following manner: a) costs which can be directly assigned to a particular service shall be so assigned. b) common costs (i.e. costs which cannot be directly assigned to a particular service) shall be allocated as follows. i) whenever possible, common costs shall be allocated on the basis of direct analysis of the origin of the costs themselves. ii) when direct analysis is not possible, common cost categories shall be allocated on the basis of an indirect linkage to another cost category or group of cost categories for which a direct assignment or allocation is possible; the indirect linkage shall be based on comparable cost structures. iii) when neither direct nor indirect measures of cost allocation can be found, the cost category shall be allocated on the basis of a general allocator computed by using the ratio of all expenses directly or indirectly assigned or allocated, on the one hand, to each of the universal services and, on the other hand, to the other services.
15 15(18) iv) common costs, which are necessary for the provision of both universal services and non-universal services, shall be allocated appropriately; the same cost drivers must be applied to both universal and non-universal services. A transparent costing system also refers to those estimates forming the basis of Posten AB s pricing. Posten AB must be able to show the principles according to which the services pricing has been made. Individual service means a service specified in the official price lists. Posten AB shall also be able to report on the internal pricing of production elements sold within the group. This condition entails a clarification of the principles contained in Article 14 of the Postal Services Directive and Chapter 3, Section 2 of the Postal Services Act. (Chapter 2, Section 4 of the Postal Services Act.) (Chapter 2, Section 4, item 2 and Chapter 3, Section 2 of the Postal Services Act) 6.3 Disclosure requirements, etc. Posten AB shall submit documentation to upon request that ensues from the above-mentioned principles for accounting costs, revenues, etc. contained in item 6.2. In addition, Posten AB, in the manner requested by, shall give the authority access to the supporting documents for the production of all data in the costing system. Posten AB is obliged to annually report to any changes made to costing and internal settlement principles or the like. Posten AB shall submit an auditable basis for costings to no later than 30 June. Specific product estimates shall be provided within one month upon request from. s examination shall include assessing the reliability of the data on which Posten AB s costing system is based, for which reason the above-mentioned documentation is required for compliance with s assignment. 30 June is an appropriate final date for the completion of some of these documents to enable to satisfy its annual reporting obligation to the Government regarding, for example, the supervision of the universal postal service and following up price objectives and price trends for other postal services.
16 16(18) shall deal with the information in accordance with the secrecy provisions applicable at any given time. (Chapter 2, Section 4, item 2 and Chapter 3, Section 2, cf. Chapter 4, Section 14 of the Postal Services Act) 7. Total Defence requirement The licence holder shall perform emergency response measures for the Swedish Total Defence following an order from and in return for cost-oriented compensation. See Chapter 2, Section 4, item 5 of the Postal Services Act 8. The term of the licence conditions These licence conditions apply up to and including 30 September 2012, unless otherwise prescribed by item 9 below. The conditions for the licence may be reconsidered after the said date. Licence conditions shall under Chapter 2, Section 5 of the Postal Services Act apply for a fixed term and may be issued in conjunction with the granting of a licence, in conjunction with the term of conditions previously issued expiring or where there are otherwise special reasons.
17 17(18) 9. Reservations 9.1 Amendments relating to costings and reporting reserves the right to issue amended conditions during the term of the conditions relating to the requirement for costings and reporting contained in Section 6. It is important for to be able to rapidly take into account experience from the authority's ongoing review and through possibly adjusting the conditions in this respect ensure that they are as appropriate as possible. 9.2 Amendments owing to statutory amendments, etc. reserves the right to issue new or amended conditions during the term of the conditions if is given new powers to issue licence conditions by an amendment of the Postal Services Act or Postal Services Ordinance or if an amendment is called for in the opinion of owing to a decision issued by a court.
18 18(18) Information on appeals If you wish to make an appeal against this decision, you must write to the Administrative Court (Förvaltningsrätten) in Stockholm. However, the letter must be sent to the Swedish Post and Telecom Authority, Box 5398, SE Stockholm, Sweden. In your letter, explain which decision you are appealing against by indicating the number of the decision. Also explain how you consider the decision should be changed. The letter must be signed. must have received your appeal within three weeks from the date on which you received the decision. Otherwise the appeal cannot be considered. will forward the appeal to the Administrative Court in Stockholm for consideration if does not itself amend the decision in the manner you have requested. Please contact if anything is unclear. This decision was made by Sten Selander, Head of Department. Åsa Gustafsson, Senior Legal Adviser, also participated in the final processing of the matter.