Cheaper cross-border Parcel Delivery

The European Commission is intervening in the parcel delivery market to create more price transparency and greater competition in order to lower prices for cross-border deliveries.

How did we get here?

More and more people are shopping online, but not many of them are shopping online cross-border. There are many reasons for that (geoblocking, different legal rights - you name it!). But one of the main problems are very expensive delivery charges for parcels. Sending a small parcel to another Member State often costs up to 5 times more than sending it within one country. To send a package from the Netherlands to Spain costs 13€, while sending it the other way around costs 32.74€.

 

Why is this important for me?

This is a first and soft intervention in the parcel delivery market. Yet, it might be sufficient to achieve its goal: more transparency, more competition, lower prices. So consumers obviously benefit because it might/will/could become cheaper to send a package from A to B. For retailers it could become more attractive to do cross-border e-commerce because one of the main obstacles that keeps consumers from shopping online abroad is removed.

 

What's the content?

The proposal by the European Commission doesn't set maximum prices for cross-border shipping. Yet, the Commisison may do that in the future, if the proposed measures don't work. So far the soft approach contains three elements: 

  1. Increased oversight by regulators: All parcel delivery service providers having 50+ employees or being active in more than one EU country have to send national postal regulators basic info about their activity (e.g. name, address) and yearly updates on volumes or the number of employees.
  2. Better price transparency: all universal service providers (USPs) (these are the ones providing a baseline level of service to every resident in a country, e.g. the Royal Mail in the UK) have to publish their domestic and cross-border prices for certain basic services (like sending a 2kg parcel to another country). The regulators will then assess if these services are affordable. Also, all the prices will be published on a Commission website to help consumers compare them. Also, online-shops must in certain cases inform consumers about parcel delivery (prices) before they buy something online.
  3. Third party access: USPs have to make sure to offer non-dsicriminatory access to their services and transparent rates for other providers who want to deliver a parcel through them cross-border (e.g. when a parcel is sent from country A to B, the provider in B charges the provider in A certain rates for the cost of delivery within country B to the final destination).

All of his is supposed to create peer pressure among parcel services and increase the competition for lower prices. The Commission will evaluate the progress made by these measures in 2019 and see if further intervention is necessary.

 

What's happening with this legislation in the future?

This file was jointly dealt with in the European Parliament's committees for Transport & Internal Market and - for the Council - among the ministers responsible for transport issues. While the Council came up with a common position, in the Parliament Lucy Anderson's (S&D, UK) draft report was first rejected. However, after MEPs spent some extra hours working on a common position trilogues were wrapped up quickly with a provisional deal in December 2017. Now the agreement needs to be confirmed by formal votes in Parliament and Council.

 

Related Bills:

Geoblocking: Less consumer discrimination online

New consumer rules for online shopping

Consumer rights for downloads and streaming services

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