© UPU 2012 – All rights reserved A snapshot of postal regulation The Arab region Marie –Odile Pilley, Postal Economics Expert (UPU workshop on postal reform

© UPU 2012 – All rights reserved© UPU 2012 – All rights reserved

A snapshot of postal regulation

The Arab region

Marie –Odile Pilley , Postal Economics Expert

(UPU workshop on postal reform and regulation" 11-13.12.2012)

© UPU 2012 – All rights reserved

Why ?

• Request by Postal Economics Group for an initial snapshot of postal regulation in the world

• Priority to developing member countries – Postal Economics resolutions Geneva and Doha

• Questionnaire tested with 8 countries and at UPU/PAPU October regulation seminar (sub Saharan Africa)

• Bulk of answers between January and April 2012


Methodology

Desk cross examination of UPU survey and internet available data

Statistics (UPU, regulators and regulation questionnaire)

Regulation

Universal postal service

Status and structures of postal entities

RDP

Postal payment and financial services regulation not included


Statistics (infrastructure and volume)

• Types – subregional - Gulf, Maghreb, middle eastern – PO box versus universal service delivery

• Postal development more linked to postal infrastructure model and organisation than to country development

• Rapidly falling letter volumes, low importance of parcels

• Increasing revenues and new ICT based integrated services

• Importance of financial services

• Interesting ratios for developing economies:

– Domestic/international

– Express/parcel

– Revenues per capita

– Letter/parcel/express volumes per capita


Market knowledge

Little available in the public domain apart from Algeria, Mauritania and Jordan, Yemen to some extent

DOs’ relative high share

Omnipresence of large international integrators and Aramex – Oligopoly ?

Overall volume of activities constrained ?

Regulatory and institutional reform stuck over the last cycle but successful DO’s modernization in the Gulf and Morocco


The designated operators’ status

S State companies

Private companies

Administr.

Algeria

Djibouti

Egypt

Iraq

Jordan

Libya

Mauritania

Qatar

Syria

United Arab Emirates

Oman (in transition)

Yemen

Morocco

Saudi Arabia

Sudan

Oman (decision made)

Lebanon Bahrain

Kuwait ?

Oman (in transition towards company status)

Palestine

In red, to be partly privatised


Postal legislation

Large reserved areas and still monopolies, at least in theory, except in Algeria (<50gr) and Bahrain (free competition)

Wide scope of postal USO or basic obligations – postal payment and financial services, pension/benefits payments and government services, supplementary postal services, express

Addressing, electronic-based services and home delivery obligation introduced (Saudi Arabia and Qatar)

Blurred/ unclear definitions

Wide use of social pricing (government decision)

Licensing/authorization system in place in most countries


Who is regulating ?

No clear trend in the Arab region – in a state of flux

Presently, 4 regulators – Algeria, Jordan, Mauritania and Sudan – Transparency: hallmark –

And regulatory functions (high level appointments) filled:

either by supervisory ministry (Tunisia, administrations)or DO’s high level Board (Egypt, Morocco, Saudi Arabia, Qatar)

Possible moves through tabled postal bills :Djibouti – regulatorMorocco ?Tunisia ? Oman ?Kuweit ? Palestine

Among countries without a regulator, Saudi Arabia alone has an open reporting/auditing systems

Uncertainty on governance – A threat to the designated operator and the postal market


Common features

Compliance by designated operator

Competition within regulatory function, except in Morocco

A licensing/authorisation system in most countries, except Bahrain and Tunisia

Pricing – uniform pricing – social approach. Pricing methodologies developed in Jordan, Morocco and Saudi Arabia

Strong system of sanction for illegal operations (regulator, Egypt, Morocco and Saudi Arabia)


Types of “independent” regulator

Algeria – a hybrid regulatory/government model – Government fixes prices – market research and control – middle income

Mauritania – an autonomous regulatory model – clear governance and division of role – strong sanction powers – LDC

Jordan – at first sight, a model close to the EU model - middle income

Algeria versus Morocco and TunisiaMauritania versus Yemen


Remarks on outcome

Market knowledge and transparency where there is a regulator

No obvious link between types of regulation and postal development

No link between country development and choice of type of regulation

Innovation where co-operation between regulatory/supervisory authorities: Morocco, Saudi Arabia, Qatar and Mauritania

Weakening of governance, where long lasting hesitancy as regards postal legislative and regulatory reforms and transfer of powers


Which approach ?

“Where infrastructure and the legislative and regulatory frameworks are weak, measures should be taken to develop them domestically on a best-fit basis, together with a phased trial-and-error approach”

Urgent need to embed market and economic research skills

Criteria for assessing regulatory effectiveness:• Transparency before institutional and non-institutional shareholder• Accountability to the executive, legislative and judiciary• Tools for institutional development• Autonomy from political authorities• Postal market and country development

UNCTAD – Managing the interface between regulation and trade in infrastructure services, 2011


Questions needing addressed

Questions

Concession or regulator ?

Multi- or uni-sector ?

If multi, communication, logistics, infrastructure ?

Checks and balances to prevent regulatory capture: auditing, funding

Pricing methodology – two sidedness, uniform pricing

Access and interconnection

Regional dimension


Some lessons from other regions

Competition introduced too early in the development process is destructive

High charging for PO boxes impact negatively postal network development

There is not such a thing as a “one-size-fits-all” model

An implementable second-best might be preferable

New regulatory models come also from the developing world


Trends and benchmark practices

Sub Saharan Africa – adoption of the regulatory model

Benchmark practice: Namibia – some re-regulationCaribbean

Proposals following EU model – Regional dimension ?Latin America

An experimentation fieldBrazil, Uruguay, Colombia … and Argentina

New developments on the EU periphery: Norway, Switzerland, Serbia, Baltic states

An emerging trend to re-regulation ?

http://ec.europa.eu/internal_market/consultations/2012/parcels-delivery_en.htm

Documents

© UPU 2012 – All rights reserved A snapshot of postal regulation The Arab region Marie –Odile Pilley, Postal Economics Expert (UPU workshop on postal reform