Commission clears French compensation for La Poste's universal service obligation

The European Commission has approved, under EU State aid rules, France's plans to compensate La Poste for its universal postal service obligation over the period 2021-2025.

In 2010 La Poste was entrusted with the provision of the universal postal service obligation for the period 2011-2025 but was not compensated for it. In November 2023, following prior exchanges, France informed the Commission of its plans to compensate La Poste approximately €2.6 billion for the period 2021-2025.

The Commission's assessment

The Commission has assessed the French measure under EU State aid rules, and in particular under Article 106(2) of the Treaty on the Functioning of the European Union, as well as the rules on public service compensation, under the Service of General Economic Interest (‘SGEI') Framework and the Postal Services Directive.

The Commission has examined whether the amount of compensation to be paid to La Poste exceeds what is necessary to cover the net cost of discharging the public service obligation. The Commission concluded that:

• The scope of the universal service obligation is in line with the definition set out in the Postal Services Directive. In  particular, it includes the delivery, at every citizen's domicile, six days a week, of postal items up to two kilograms, postal packages up to 20 kilograms, and recommended letters.
• The direct entrustment of the universal service obligation for the provision of postal services is in line with the rules on public service compensation and the Postal Services Directive, which allows the State to directly designate the universal service provider without conducting a tender.
• The compensation is based on a robust cost methodology, which ensures that it will not exceed the net cost of the public service entrusted to La Poste.

On this basis, the Commission approved the French measure under EU State aid rules.

Background

Under EU State aid rules on public service compensation, and in particular under the Service of General Economic Interest (‘SGEI') Framework, adopted in 2011, companies can be compensated for the extra cost of providing a public service under certain conditions. This enables Member States to grant State aid for the provision of public services, while making sure that companies are not overcompensated, which minimises distortions of competition and guarantees an efficient use of public resources.

In addition to today's decision to compensate La Poste for the performance of the universal postal service obligation, La Poste is also currently being compensated for public service obligations of maintaining a contact point office network throughout the French territory (SA.100960), for transporting and distributing press within the French territory (SA.102817), and for providing certain banking services via La Banque Postale (SA.41147).

For More Information

The non-confidential version of the decision will be published in the State aid register on the competition website under the case numbers SA.100746 once possible confidentiality issues have been resolved. New publications of State aid decisions on the internet and in the Official Journal are listed in the State aid weekly e-News.