UPS disappointed by DOT-DHL ruling

by Canadian Shipper

UPS, United Postal Service, says it is disappointed by a May 11 ruling by the U.S. Department of Transportation that allows DHL Worldwide Express to operate as a Foreign Air Freight Forwarder (FAFF) in the United States.

UPS had challenged the license before the recently reorganized DHL/Deutsche Post began operations in the U.S. on the grounds that a foreign postal entity like Deutsche Post had a potential to distort the marketplace because of an alleged history of abusing its monopoly through cross subsidies.

On March 20, 2001, the European Commission ruled that Deutsche Post abused its monopoly on first-class mail and had engaged in unlawful, anti-competitive practices including predatory pricing.

Though disappointed in the ruling, UPS says however that it accomplished one of its goals in the challenge, which was to raise public awareness of the issues against Deutsche Post.

“Our petition and (the DOT) ruling have brought to light the practices of Deutsche Post and helped educate the public about the competitive dangers of granting access to a foreign government monopoly that has been found guilty of anti-competitive behavior in its home market,” said UPS spokesman Tad Segal.

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