Universal service obligation
bpost is the designated provider of the Universal Service Obligation until 31 December 2023. This entails:
- Collection, sorting, transport and distribution of postal items up to 2kg and single piece postal packages up to 10kg (and up to 20kg for packages coming from Member States)
- Providing services for registered items and insured items
Furthermore, as Universal Service Provider, bpost is required to:
- Apply uniform tariffs and an identical service across the territory
- Operate at least 1 access point per municipality in Belgium
- Collect and distribute postal items at least 5 times a week (excluding Sundays and official holidays)
- Cover the full territory of Belgium for collection and delivery of items belonging to universal service
Any operator (other than the designated USO provider) who performs letter mail service falling in the scope of the USO requires a license issued by the Belgian postal regulator IBPT/BIPT.
To obtain a license, the operator in question needs to employ contractual workers to ensure a level playing field.
Services of General Economic Interest
bpost renders several public service missions or Services of General Economic Interest (SGEI) for which it is compensated by the Belgian State. bpost has been granted two concessions by the Belgian State for executing press distribution. These concessions run for a 5-year period from 1 January 2016 until 31 December 2020 and have been extended for 2 years until 31 December 2022. They entail:
- Early distribution of newspapers (before 7:30 in weekdays and 10:00 on Saturdays)
- Distribution of periodicals at a tariff set by the Belgian State
The state remuneration for these two concessions amounted to EUR 173.3 million in 2016, EUR 175.5 million in 2017, EUR 172.9 million in 2018, EUR 169.9 million in 2019 and EUR 166.5 million in 2020.
bpost will receive a maximum remuneration (excluding inflation) of EUR 166.5 million for 2021 and 2022. The amounts for these two years will be adjusted for inflation.
Besides press distribution, bpost also renders a couple of other SGEI. These are described in the Seventh Management Contract concluded with the Belgian State. They entail among others:
- Maintain an extensive retail network of post offices and post points
- Payment at home of pensions and other social allowances
- Acceptance in post offices and post points of deposits to current account held at bpost or other financial institutions
- The execution of operations related to the basic banking service in post offices
- A specific rate for correspondence sent by the associations
- Distribution of elections printed matters at a reduced tariff
- Delivery of letter post items that fall within the freepost system
The Seventh Management Contract is covering a 5-year period from 1 January 2022 until 31 December 2026. bpost receives a maximum compensation (excluding inflation) of EUR 126.42m for 2022, EUR 127.70m for 2023, EUR 129.54m for 2024, EUR 125.77m for 2025 and EUR 124.93m for 2026. These amounts will be increased with inflation on an annual cumulative basis. The fluctuation in the compensation during the term of the contract is based on forecasts of the net cost and the gains in efficiency with regard to SGEI. There is also a claw-back mechanism to avoid any risk of overcompensation.
Mail pricing principles
For services falling within the USO, general pricing principles of affordability, cost-orientation, transparency and non-discrimination are applied. In addition, tariffs for single piece items must be uniform across the country.
Single piece domestic mail items & USO parcels falling within the “small user basket” are subject to a price-cap formula, which takes into account inflation, volume decline and efficiency gains. The unused part of the price increase margin is accrued for 3 years, every year on a rolling basis.
Price increases are in practice done on a yearly basis on 1 January.
The Belgian Institute for Postal services and Telecommunication (IBPT/BIPT, www.bipt.be) regulates the postal sector in Belgium.
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