Country sheet: Romania - CIRCABC - Welcome · PDF fileCountry sheet: Romania 779 Aspect Implementation and remarks Universal service and its financing The universal service consists

Country sheet: Romania 777

Country sheet: Romania

1.1 Summary

Mail market characteristics

The Romanian postal market is characterised by:

(i) A mixed geographical terrain, ranging from flatlands to mountainous terrain with a population

density below the European average and a low degree of urbanisation;

(ii) Low mail volumes per capita; and

(iii) Low regulatory interference.

Regulatory developments

• The reserved area in the Romanian postal market was reduced from 100g to 50g on 1

January 2006. Incoming and outgoing cross-border mail and direct mail are reserved.

• A licence is required for the provision of services within the universal service. Only

one licence is granted, to the NPO Posta Romana. A general authorisation is

necessary for the provision of postal services outside the universal service.

Market developments

• The market of postal services has shown a big, double-digit growth in the past years,

with overall mail volumes (including parcel and express, excluding unaddressed)

increasing with 17% from 2004 to 2005 and 18% from 2005 to 2006.

• The simplified authorisation regime stimulated the development of the Romanian

market of postal services, in particular courier services. The number of authorised

postal services providers increased from five in 1999 to 238 in 2006.

• Competition in the addressed mail market is very limited, with Posta Romana

handling 96.9% of the mail volume.

• Competition is high in the parcel market, where Posta Romana has a market share (in

volume) of 12.5%. The next five providers have a combined market share of 42.3%,

whereas the other 86 providers process the remaining 45.2% of the volume.

• Also within the express market there is a significant degree of competition. In this

segment, Posta Romana has a market share (in volume) of 50.6%. The five largest

competitors of Posta Romana have a combined market share of 36.9%. The other 36

active providers account for the remaining 12.5% of the express traffic.

Annex II: Main Developments in the Postal Sector (2006-2008) 778

• Various international operators are strengthening their position in Romania through

take-overs. Examples are the planned take-over of CURIERO by RTC Holding BV,

the recent acquisition of Pegasus by GeoPost (a subsidiary of the La Poste), the UPS

take-over of its authorised provider in Romania (Trans Courier Services) and the

planned acquisition of the second largest Romanian courier service provider, Cargus,

by Deutsche Post (DHL).

Discussion points

• Experiences in Romania support the observation that in countries were competition is

still in the earliest phase of development the NPO has a major competitive advantage

in that it is able to provide a level of service quality that competitors are unable to

meet (yet).

• ECORYS observes that in recent years the number of authorised providers has

increased substantially, indicating low barriers to obtain a license, but that a lot of

these licenses remain unused. It is likely that this development is caused by

Romania’s low degree of urbanisation, low mail volumes as well as the existence of

the reserved area.

Summary information on market developments:

Postal market segment / aspect Competition (market shares) Main competitors / remarks

Express NPO: 50.6% Many competitors

Parcel (main players) NPO: 12.5% Many competitors

Unaddressed n.a.

Cross-border mail NPO: 98.7% Addressed mail only; including

parcel and express - NPO: 85%

Addressed mail (market share CPOs)* NPO: 96.9%

Population density (inhabitants/km2) 90.32

Total addressed mail market (items) 526m Including inbound and excluding

outbound cross-border mail**

Addressed mail volume per capita 24.4

Status of NPO Posta Romana is a joint stock

company and 100% government

owned

Privatisation is being prepared

Main divisions of NPO Central administration (including

ten regional postal directorates);

Five specialized branches:

Expedition house, Rapid post

(courier) directorate, Financial

services directorate, National

stamp museum, Stamps factory

Note: * The market share of CPOs refers to the combined market share of CPOs in domestic addressed mail

delivery, excluding newspaper delivery. ** Based on the assumption that 50% of cross-border mail is inbound.

All figures refer to 2006. N.a. is not available.

Summary information on the implementation of the Postal Directives:


Aspect Implementation and remarks

Universal service and its

financing

The universal service consists of letter mail items up to 2 kilograms and

domestic and international parcels up to 20 kilograms.

Reserved area The reserved area consists of domestic and both incoming and outgoing

cross-border mail items up to 50 grams or 2.5 times the ‘stamp rate’ and

includes direct mail.

Licensing and network access A licence is required for provision of services in the universal service area, an

authorisation is required for the provision of postal services outside the

universal service area. There are no significant barriers to entry connected to

the licensing conditions.

There is no mandatory access to the network of postal operators.

Tariff principles and

transparency of accounts

Tariffs for universal services have to be submitted for approval to the NRA.

These tariffs must be affordable, transparent, non-discriminatory and cost-

oriented. To check compliance with the cost-orientation obligation within the

USO, Posta Romana obliged to have a separate accounting system, based

on the internal cost accounting system and meant to separate the activities

within the scope of universal service from the activities outside the scope of

universal service, as well as the reserved from the non-reserved activities.

Quality of services The standards for transit times are 85% for D+1 and 97% for D+2 for

domestic mail. For international mail, the standards are 85% J+3 and 97%

J+5. Monitoring is conducted by an independent monitor and in compliance

with CEN standards.

The national regulatory

authority

The NRA of Romania is ANRCTI. ANRCTI has nearly full regulatory powers.

There is no information on the number of FTE working at the postal unit of

ANRCTI.

1.2 General information

Romania is a relatively large country with approximately 22 million inhabitants and a

territory of little over 238,000 square km. Its population density is below the EU average

(of 113 inhabitants/square km) with an average of 90 inhabitants per km2. Romania's

terrain is distributed roughly equally between mountainous, hilly and lowland territories.

Almost 15% of Romania’s population live in the five largest cities. For general country

information about Romania, see Table 0.1.

Table 0.1 General country information (2007)

Romania 2007

Population (in million) 21.5*

Size of the country (1,000 km2) 238.4*

Population density (inhabitants/km2) 90.3*

Degree of urbanisation 53.7**

Number (and percentage) of inhabitants 5 largest cities 3.1 million (15%)***

Sources: * UPU (2006), ** UN (2005), *** World Gazetteer (2008 estimation).


1.3 Regulatory developments

1.3.1 Postal law and regulation

The Romanian postal market is mainly regulated by Government Ordinance 31/2002.

At 7 September 2007, ANRCTI President’s Decision no.2858/2007 came into force,

which regulates both the conditions under which postal service providers operate and

simplifies the procedure of authorisation.

An overview of the main postal law and regulations can be found in Table 1.2.

Table 0.2 Postal law and regulation

Postal law and

regulation

Date of

introduction

Date of latest

amendment

Remarks

Government

Ordinance no. 31 of

30 January 2002

2002 2006 Ordinance on postal services, approved, with

amendments and completions, by Law 642/2002,

subsequently amended

Law no 642 2002 Amendment of Government Ordinance no. 31,

stipulating provisions on the USO and the reserved

area

Law No 591 2002 Legal basis for ANRCTI’s monitoring capacities

Government

Decision 2003 / 1351

2003 On the conditions and the procedure of designation of

universal service providers in the postal services

sector

Government

Decision 2004 / 88

2004 On the Designation of the Universal Service Provider

in the Postal Services Sector

Government

Decision 2004 / 153

2004 On the Amendment of the Decision of the President of

the National Regulatory Authority for Communications

no.88/2004 on the designation of the universal service

provider in the postal services sector

Government

Decision 2004 / 1301

2004 On reporting statistical data by the providers of postal

services

ANRCTI President’s

Decision

no.2858/2007

2007 General authorisation regime for the provision of

postal services

Source: ANRCTI – Romania 2008.

1.3.2 Universal Service Obligation

Government Ordinance no.31/2002 defines the universal service as a person’s right to

benefit from the permanent provision of postal services within the scope of universal

service, at certain quality standards, at any location on the national territory, at affordable

prices.


The scope of universal postal service is:

• clearance, sorting, transport and delivery of the postal items, domestic or cross-

border, up to 2 kilograms;

• clearance, sorting, transport and delivery of postal packages, domestic or cross-

border, up to 10 kilograms;

• distribution of postal packages up to 20 kilograms, sent from outside Romania to an

address located in the Romanian territory;

• service for registered items, either domestic or cross-border;

• service for insured items, either domestic or cross-border.

Romanian postal law has special provisions both for blind and partially sighted persons

and stipulates conditions regarding access of citizens to the universal service. These

provisions follow general UPU policies and regulations.

On 22 April 2004, Posta Romana (officially: National Company Posta Romana) was

designated as a universal service provider in the postal services sector of Romania, for a

five year-period.1

1.3.3 Reserved area

The reserved area in the Romanian postal market was reduced from 100g to 50g on 1

January 2006. Since then, the reserved area consists of domestic and both incoming and

outgoing cross-border mail items up to 50g or 2.5 times the ‘stamp rate’ and includes

direct mail.

Table 0.3 Liberalisation of postal services and the reserved area (2008)

Postal product Within reserved area

(Yes, no, partially or unclear)

Remarks

Bulk mail and consolidation Yes Up to 50 g

B2B non-bulk mail Yes Up to 50 g

Individual item mail Yes Up to 50 g

Cross-border mail Yes Up to 50 g

Unaddressed mail No

Parcel mail No

Express mail No

Source: ANRCTI - Romania 2008.

Plans for next steps

Romania will follow the implementation of EU Postal Directive with liberalisation of the

mail market not later than January 2011.

1 ANRCTI President's Decision no.88/2004.


1.3.4 NRA

On 29 December 2006, the National Regulatory Authority for Communications and

Information Technology (ANRCTI) was established, following the reorganisation of the

National Regulatory Authority for Communications, which is now abolished.2 ANRCTI

is an independent regulatory body. The two fundamental objectives of ANRCTI are

promoting competition and protecting the end-users’ interest.

Role of NRA

ANRCTI was created in order to answer to the necessities of regulating the information

technology field in close connection with the convergent fields of electronic

communications and postal services. The monitoring and control activity of ANRCTI has

been conducted with a view to providing protection of the users’ rights and interests,

promoting competition under transparency, impartiality and objectivity conditions, and

envisage legal and natural persons under the provisions of the legislation in the electronic

communications and postal services sector. The control of compliance with the provisions

of the legislation in force has to be performed by the control personnel mandated by the

President of the Authority.

The ANRCTI President’s Decision no.1301/2004 on reporting certain statistical data by

postal service providers was published in the Romanian Official Journal, Part I, no.1125

of 30 November 2004 and focuses on the imposition on the postal services providers of

the obligation to regularly send ANRCTI certain statistical data, in view of drawing up

reports, studies, analyses and other such documents in the field of postal services. In the

period 2002 -2004 ANRCTI provided merely statistical data on postal market

developments, followed by more extensive market analysis reports in 2005 and 2006.

These are based on the responses to a questionnaire sent to all postal operators (who have

the legal obligation to complete these questionnaires).

Table 0.4 lists the capacities of ANRCTI. These include price regulations, setting

requirements for an accounting system and conducting market surveys. In 2006, ANRCTI

activity focused on monitoring the obligations imposed on the Posta Romana in its

capacity as a universal service provider (USP).

2 Previous to establishment of ANRCTI, the name was ANRC without mentioning Information Technology.


Table 0.4 Regulatory powers NRA

Powers Yes/No/Unclear Remarks

Require data from USP Yes Market survey

Require accounting system Yes Separation of USO

Require new data studies Yes Market survey

Cancel unlawful rates Yes

Levy Fines Yes

Seek judicial order Yes

Set new rates for USP Yes

Require downstream access No

Require data from non-USPs Yes Cooperation with market survey

Source: ANRCTI - Romania 2008.

Capacities of NRAs

The number of FTE working at the postal unit of ANRCTI is unknown to ECORYS.

Complaints and redress procedures

ANRCTI was mandated to establish procedures of solving disputes in its competence

area, i.e. between the users and the providers of postal services, and between the end-

users and the providers of electronic communications services.

1.3.5 Licenses

Companies intending to provide postal services within the universal service are required

to have a licence. For the provision of services outside the universal service, a general

authorisation is required.3 For an overview, see

3 The authorisation regime for the providers of postal services has been implemented by Decision of the President of

ANRCTI no.118/2003 on the procedure for the authorisation of the postal services providers, which entered into force on 1

April 2003.


Table 0.5.


Table 0.5 Entry regulations

Instrument Services allowed under the license Conditions for

obtaining the licence

Number of

licences

approved (2007)

Individual

license

Universal postal services ‘Essential

requirements’

1

Postal services without added value: national post

services (weight of domestic and cross-border

postal items limited to values between 10 - 50 kg),

courier services (weight of domestic and cross-

border postal items limited to values between 10 –

50 kg), included financial-post services, and direct

mail.

Mail : 1

Courier: 166

Financial mail: 1

Direct mail : 28

General

authorisation

Value added postal services: national post

services and courier services (both with maximum

weight of 50 kg), express services, financial post

services, direct mail

‘Essential

requirements’

Domestic mail : 1

Courier : 207

Express : 32

Financial mail :1

Direct Mail : 59

Source: Activity Report ANRCTI 2003.

Licences and registrations are given by ANRCTI.

The individual licence is granted by ANRCTI for a period of ten years to the companies

that intend to provide postal services within the scope of the universal service and grants

them specific rights and obligations additional to those under the general authorisation

regime.

Currently, there is one licensed postal operator, Posta Romana.

The general authorisation regime allows the following services:

• postal services without added value, i.e. national postal services (weight of domestic

and cross-border postal items limited to values between 10-50 kg), courier services

(weight of domestic and cross-border postal items limited to values between 10–50

kg), including financial postal services and direct mail;

• value added postal services, i.e. national postal services and courier services (both

with maximum weight of 50 kg), express services, financial postal services and direct

mail.

In 2006, ANRCTI received 67 notifications on the intention to provide postal services

based on the general authorisation regime and 25 amendment requests. Moreover, it

issued 69 standard-certificates, whereas 15 standard-certificates were replaced following

the amendments communicated by the providers of postal services. Furthermore,

ANRCTI received 22 requests for suspending the right to provide postal services, and

subsequently dismantled the respective companies from the Providers’ Official Record.

Another two providers have been dismantled in 2007.


Analysis of requirements

When adopting the new authorisation regime, the main objective of ANRCTI has been to

facilitate the entry of companies in the postal services market. Authorisation is free of

charge and the procedure is very much simplified, in order to eliminate any unnecessary

red-tape. The simplified authorisation regime, requiring mainly notification, stimulated

the development of the Romanian market of postal services: the number of authorised

postal services providers increased from five in 1999 to 238 in 2006.

All postal services providers are bound to observe certain ‘essential requirements’, which

represent general conditions imposed by the Law for the provision of postal services.

These requirements include:

• to ensure the confidentiality of postal deliveries;

• to ensure the security of the postal network as regards the transportation of dangerous

assets;

• to observe the terms concerning the protection of personnel;

• to ensure the confidentiality of the transmitted and filed information;

• to protect the right to privacy and the environment; and

• to observe the terms on territory administration and urbanism.

Degree of uncertainty

The degree of uncertainty is low. The time period for granting the individual licence is 90

days after the date when the request is registered. For authorisation, the requester obtains

the right to provide postal services and may begin its activity no later than 45 days after

ANRCTI is notified.

1.3.6 Access

There is no mandatory access to the network of postal operators in Romania, see Table

0.6.

Table 0.6 Network access

Upstream/downstream Form of access Regulated?

(Yes, No, Unclear)

Upstream Access to street letter boxes No

Access to outward sorting centres No

Downstream Access to inward sorting centres No

Access to delivery offices No

Access to P.O. Boxes No

Source: Source: ANRCTI Activity report 2005.

Although postal activities do not necessarily require infrastructure of their own, most

operators prefer to provide postal services through their own network. Thus, in 2005, 153

authorised providers of postal services (81% of the total number of 190) used exclusively

their own network, 34 providers notified ANRC to use both their own and a third

authorised party’s network, and three providers chose to operate exclusively through a

third authorised party’s network.


1.3.7 Price regulation

Tariffs for universal services have to be submitted for approval to the NRA.4 These tariffs

must be affordable, transparent, non-discriminatory and cost-oriented.5

Posta Romana is obliged to implement an internal cost accounting system in order to be

able to check compliance with the cost-orientation obligation within the USO.6 Also is

Posta Romana obliged to have a separate accounting system, based on the internal cost

accounting system and meant to separate the activities within the scope of universal

service from the activities outside the scope of universal service, as well as the reserved

from the non-reserved activities.

Annually by the 30th of November, the accounting statements for the previous year have

to be provided to the NRA. These accounting statements are then assessed by an

independent body, under the terms and according to the procedure established by

ANRCTI.

1.3.8 Quality of service

Regulation

Based on the ANRCTI President’s Decision no.88/2004 on the designation of a universal

service provider in the postal services sector, ANRCTI monitors the compliance of Posta

Romana with the universal service obligations in the postal field by control activities,

focusing on the compliance with the provisions regarding:

• the number of clearances at each access point and the number of deliveries to the

residence of each natural person and to the headquarters of each legal person;

• the observance of the quality standards;

• the confidentiality and security of postal items;

• ensuring optimal density of access points and of mail boxes;

• the accessibility, transparency and cost-orientation of the tariffs;

• tariff uniformity on national level;

• the implementation of separate accounts;

• the availability for the users, on a regular basis, of accurate, updated and detailed

information on the characteristics of postal services.

In accordance with the provisions under art.12 of ANRCTI President’s Decision

no.88/2004, Posta Romana has the obligation to ensure the achievement of quality

objectives. The following table shows these objectives for both 2004 and 2007. These

standards are valid for mail services of the fastest standard category, below 2 kg.

4 Ordinance on Postal Services, Article 22 (2).

5 Ordinance on Postal Services, article 22 (1).

6 ANRCTI President's Decision no.88/2004.


Table 0.7 Quality of service standards

Category 2004 2007

Domestic items of correspondence D + 1 = 70 %

D + 2 = 80%

D + 1 = 85%

D + 2 = 97%

Cross-border items of correspondence J + 3 = 75%

J + 5 = 85%

J + 3 = 85%

J + 5 = 97%

Source: Activity Report ARNCTI 2004. ANRCTI Analysis of the postal market 2006.

Monitoring performance

Posta Romana has the following obligations in 2006:7

• Compliance with the quality objectives and determining the real flow of domestic

postal items in the standard service, by an independent body. This body shall

effectuate measurements to determine both compliance with quality standards and

flow of domestic postal items in the standard service;

• Assessing the observance of the provisions of the SR EN 13850:2003 standard on the

measurements of the real flux and their results, by contracting an independent audit

body which shall have no property or control connection with Posta Romana or with

the independent monitoring body which carried out the respective measurements.

Monitoring compliance with CEN standards

ANRCTI conducted in 2004 a study regarding the introduction of European standards on

the quality of postal services on the universal service provider in Romania, C.N. Posta

Romana S.A. This action was triggered by the necessity of observing the provisions of

European law. As well, ANRCTI elaborated the list of CEN standards (European

Committee for Standardisation) proposed for adoption as national standards and

forwarded to ASRO (the Romanian Association for Standardisation).

Performance

No data were found concerning the actual performance of Posta Romana regarding the

quality of service standards. Its 2006 Annual Report merely indicated the standards

without elaborating on the actual performance.

Table 0.8 Quality of service USP

Standard Threshold Performance USP Remarks

Transit time domestic

items of correspondence

D + 1 = 85%

D + 2 = 97%

n.a. Study will be undertaken

soon*

Transit time for cross-

border priority mail

D + 3 = 85 %

D + 5 = 97 %

n.a. Study will be undertaken

soon*

Source: Activity Report ARNC 2004. ANRCTI Analysis of the postal market 2006.; * Annual Report Posta

Romana 2006 (p.43, the UPU was going to provide funds for these studies in 2007).

7 Decision no.1468/2005 on establishing the terms and procedure for assessing the compliance of Posta Romana with the

quality objectives.


1.4 The mail market

1.4.1 Mail market overall

In 2006, the volume of the mail market was 576.3m items, while the letter mail volume

was 555.3m items.8 There has been a substantial growth in mail volumes as the

comparable figures for 2005 were 490.0m and 464.7m, respectively. Of the addressed

mail market (letter mail) volume, 18.3m items (3.8%) represents cross-border mail.

A comparative analysis of the data reported in 2004, 2005 and 2006 revealed a constant

traffic growth, see Table 1.9.

Table 0.9 Overview of postal traffic (in million mail items)

Overview on the postal

traffic

2004 2005 2006

Number of postal items 417 490 576

Index 2004 = 100 100 117 138

Index 2005 = 100 100 118

Source: ANRCTI report Analysis of the postal market 2006.

Mail volumes per segment

Mail volume data per market segment are presented in Table 1.10.

Table 0.10 Size of the mail market in physical terms (million items)

Postal product 2005 2006

Bulk mail and consolidation

B2B non-bulk mail

Individual item mail

449.2

535.0

Cross-border mail (letter mail) 15.6 18.3

Unaddressed mail n.a. n.a.

Parcel mail 7.3 6.4

Express mail 18.0 16.6

Total 490.0 576.3

Source: ANRCTI Activity report 2006.

Note: Due to rounding, figures may not exactly add up. For parcel mail, 1.0m and 2.0m items is cross-border

mail (for 2005 and 2006, respectively), while for express the figures are 0.8m and 1.0m, respectively. N.a. is not

available.

According to Eurostat, the number of addressed letter mail items per capita is 13 items.9

Our own calculation based on the information presented in the table above is that the

8 Excluding unaddressed mail.

9 Eurostat December 2007, Inquiry on Postal Services 2006. The indicator refers to the total letter-post services (ITM 402).

Letters post services include ordinary letters and postcards, direct mail, registered mail, insured mail and other letter-post

items.


number of domestic addressed mail items per capita is 24.4 (this excludes parcel mail,

express and unaddressed, and assumes that half of the cross-border mail is outbound).10

1.4.2 B vs C

Posta Romana indicates in its annual reports that the dominant mail volumes are

generated by its business customers, which are also responsible for the growth in mail

volumes. Some of the largest customers of Posta Romana (according to their website) are

the main commercial banks active in the country (ABN AMRO Bank, Romanian

Commercial Bank, Romanian Development Bank, BancPost etc.), other large service

providers (cable companies, telecommunication companies, gas distributors), large

retailers (Oriflame, Avon- both cosmetics distributors) as well as public institutions

(Ministry of Justice, Ministry of Finance).

1.4.3 Market opening

Approximately 10% of the total mail market (in volumes) is open to competition. The

letter mail market that is opened to competition represents approximately 6% of the

volume of the total mail market, while parcel and express represent 1% and 3% of the

total mail market opened to competition, respectively.

1.4.4 Cross-border mail

Cross-border postal items totalled 21.3m items (including parcel and express) in 2006.

Most of this concerns addressed mail, whereas cross-border parcel mail volumes are

larger than cross-border express volumes, as can be seen in Table 1.11.

Table 0.11 Division of cross-border mail per category

Weight of the distribution of postal items within the total cross-border (%)

Year 2004 2005 2006

Letter mail 83.0% 90.0% 86.1%

Parcel mail 11.6% 5.5% 9.3%

Express mail 5.4% 4.5% 4.5%

Total 100% 100% 100%


1.4.5 Impact of innovation

Also in Romania, ultimately electronic correspondence could be a threat for the classical

postal services. However, since the electronic signature is not yet legal in Romania, the

threat is still limited. Until now, the development of Internet has in fact contributed to

10

535.0m minus half of 18.3m, divided by 21.53m inhabitants.


higher turnover in the postal sector, especially in courier services. For example, 10-15%

of the turnover of the biggest provider of courier services (Fan Courier) is generated by

electronic commerce. This figure is further boosted by activity generated by teleshopping.

1.5 Market structure and competition

1.5.1 National postal operator/Universal Service Provider

The NPO in Romania is Posta Romana. Posta Romana has been transformed into a joint

stock company based on Romanian law. Posta Romana is 100% government owned and

privatisation is being prepared.

Information on the postal network is given in Table 1.12.

Table 0.12 Postal network of the national postal operator

Posta Romana 2006/7

Number of post offices

Number of postal agencies

831 urban and 6,233 rural

Number of street letterboxes (end 2006) 13,927*

Source: Annual Report Posta Romana 2006.

Note: * The objective is to have at least one collection box in every community.

Percentage of revenues and profit coming from letter mail and more specifically from the

reserved area

In 2006, the postal traffic achieved by the universal service provider, Posta Romana,

based on the rights for reserved postal services, was 153.9 million items correspondence,

equalling 53.3% of the universal service traffic and 26.7% of the all postal traffic in 2006.

No information is available for the profits per market segment.

Degree of vertical and horizontal integration

Posta Romana has not been very active in terms of acquisitions. However, Posta Romana

has set aside a budget of 20m euro for acquisitions and, according to its operational

executive director, “the sum could be increased substantially.”11

1.5.2 Competitor postal operators

In 2006, there were 238 authorised postal operators. Most of them are small courier and

express companies. An overview of the development of the number of authorised

providers is given in Table 1.13.

11

“Postasul suna de soua ori: Vindeti sau cumparati?” (“The mailman always rings twice: Are you selling or are you buying”),

article in Business Week, April 2008, published and accessed online at http://www.pegasus.ro/cpro_aprilie_2008_12_ro.


In 2006, of the 258 authorised providers required to supply information on their activity

to the NRA, 135 were active in the postal services market, while 83 did not exercise their

right to provide postal services. The rest did not comply with their obligation to supply

information. Among these 258 providers, 20 had required their removal from the register

of authorised service providers.12

Table 0.13 Number of authorised providers between 1999 and 2006

Evolution of the postal services market (number of authorised providers), 1999 – 2006

Year 1999 2000 2001 2002 2003 2004 2005 2006

Number of

authorisations

5 7 8 67 118 138 190 238


A classification of the postal services providers can be made using various criteria: origin

of the postal items, type of postal services and traffic volume. This is summarised in

Table 1.14. It should be noted, however, that some providers provide postal services in

multiple categories.

Table 0.14 Division of postal operators by segment

Category Domestic only Cross-border only Both Total

Letter post 52 14 13 79

correspondence 39 4 8 51

printed matter 7 1 2 10

direct mail 8 0 0 8

small packets 35 15 7 57

Parcels 25 57 10 92

2-50 kg 20 27 7 54

10-50 kg 23 52 8 83

Express 28 7 7 42

<2 kg - - - 33

2-50 kg - - - 31

Total 57 60 18 135

In Tables 1.15 en 1.16, the number of competitors is provided per postal product. A

distinction is made between value added postal services and non-value-added services.

12

The figure of 258 includes the 238 authorised providers plus the 20 providers that required to be removed from the register

of postal service providers during 2006.


Table 0.15 Number of providers of value added postal services

Number of providers of value added postal services (total 217, as of 31 December 2006)

Domestic postal services Within the weight range 0-10 kg 1

Within the weight range 10-50 kg 1

Express service 1

Courier services Within the weight range 0-10 kg 206

Within the weight range 10-50 kg 207

Express service 32

Financial postal services 1

Direct mail services 59


Table 0.16 Number of providers of non-value-added postal services

Number of providers of non-value-added postal services (total 173, as of 31 December 2006)

Domestic post services, within the weight range 10-50 kg 1

Courier services, within the weight range 10-50 kg 166

Financial postal services 1

Direct mail services 28

Source: ANRCTI Activity Report 2006.

Romanian postal operators can also be classified according to the geographic area. Most

postal service providers are based in Bucharest (53), respectively in the counties of

Vrancea (17) and Iasi (12). In nine counties, however, there are no postal service

providers with local headquarters. These differences in locations are due to their

territorial position, infrastructure, population density, as well as to the support granted to

the companies by the local authorities.


Table 0.17 Overview of main competitors on the postal market who are also active in addressed mail (2007)

Postal

operator

Market Volume mail

/ Turnover

Mail

# of

employees

Service

level

(no. of

deliveries /

week)

Coverage

Curiero (3) Express services, courier

services, domestic items

of correspondence and

advertising material, min.

500 items per pick up or

min. 3000 envelopes per

month

Entire country, but

only the main cities

(70 agencies in the

entire country)

Pegasus Domestic and cross-

border courier services,

including parcels,

unaddressed mail

(including designing the

campaign/ distribution

plan), direct addressed

mail

260*

Cargus (2) Courier services,

including express, cargo,

secure money transport

More than

1,700

employees

and

associates

20,000

transactions

per day

90 offices and

expedition centres

country-wide and

600 vehicles

Fan Courier

(1)

Courier services, focusing

mostly on the domestic

express market

More than

1,800

employees

400 fixed collection

centres (staffed)

around the country

(no. is growing);

1,300 vehicles

Sources: various press articles and websites of the companies.

Note: The number in parenthesis represents the position in the postal market, by turnover; * figures from a IBP

(business listing portal).

Curiero is one of the leaders in the domestic courier services market. In 2007 its turnover

was €15m, 85% more than in 2006. It aims for another 70% increase this year (2008), up

to a level of €45m, with a profit margin of 10-11%. The largest growth comes from the

express market (Curiero 24), where an increase of 150% was achieved. Curiero 24

generated 70% turnover in 2007. Curiero post (addressed and unaddressed mail)

represents only 3% of the company’s turnover. Currently Curiero is waiting for a decision

of the Competition Council whether it can be acquired by RTC Holding BV.

Fan Courier has been the leader in the market of private service providers for the past

three years (in particular in express). In 2007, it accounted by itself for 27-28 % of the

cumulative turnover of Romanian courier service providers. Also Fan Courier derives

most of its turnover from courier services. It has a portfolio of 10,000-12,000 contractual


clients, of which 85-90% are business clients. Fan Courier is investing heavily (close to

€9m in 2008) in a new logistics centre close to Bucharest, new headquarters, expanding

the number of its vehicles by 20-30% and training of its personnel (€300,000). According

to its website, the turnover of Fan Courier in 2006 was €21.5m, and had significantly

gone up in 2007, reaching €22.4m in the first three quarters of 2007. This was mainly

caused by a new service: the company offers and manages the newly introduced

compulsory private pension scheme, which has led to a 10% increase of the business).

Fan Courier’s explicit strategy is to focus on the domestic market, as here they see the

largest growth potential.

Pegasus, the idea of a Romanian and a British entrepreneur (who are still heading it),

started about 11 years ago with five bike couriers and developed into a business with a

capital of over 10,000 USD and a turnover of €2.6m (2006)13. According to information

from the website, Pegasus’ success is a result of it being able to sign some important

contracts with companies like Orange (the cell phone operator) and becoming the

designated local courier of the American company Airborne Express. Recently, Pegasus

has been acquired by GeoPost, a subsidiary of the La Poste (France), who now owns 80%

of the company’s shares.

The concentration trend in the courier market in Romania has accelerated this year. The

ten largest providers of courier services were responsible for over 90% of the €200m

turnover in this market. In addition to the two takeovers mentioned above, UPS has taken

over its authorised provider in Romania (Trans Courier Services). Deutsche Post (DHL)

will become the main owner of the second largest Romanian courier service provider,

Cargus, provided the Competition Council does not object. Cargus’ turnover in 2007 was

approximately €29.7m and is estimated to grow by 50% this year.

1.5.3 Competition

Competition in the letter market is still limited. Posta Romana processed 536m items

(96.9%), whereas the next five providers achieved a volume of 12m items (2.2%). The

other 73 providers processed 5m items (0.9% of the total letter post traffic). The

following CPOs registered the highest letter post traffic (in alphabetical order): Cargus,

Concorde Courier, Curiero, Inform Media and Nemo Prod Com Impex.

In the market for cross-border addressed mail, the market share of Posta Romana is circa

98.7%, while including parcel mail and express the figure is around 85%.

Competition is high in the parcel market, where Posta Romana processed 800,000 items

(12.5%). The next five providers processed 2.7m items (42.3%), whereas the other 86

providers processed 2.9m parcels (45.2%).

Also within the express market there is a significant degree of competition. Posta Romana

processed 8.4m items (50.6%), while the next five providers processed 6.1m items

13

The turnover figure comes from IBP (Major Companies in Romania an online Business Portal :

http://mcir.doingbusiness.ro/en/).


(36.9%). The other 36 providers achieved a volume of 2.1m items (12.5% of the total

traffic in express services).

Table 0.18 Number of competitors and degree of competition (2006)

Postal product Market share USP Number of

competitors

Concentration ratio

C3

Bulk mail and consolidation

B2B non-bulk mail

Individual item mail

96.9%

Five with some

volume, many very

small ones*

C6 – 99%

Cross-border mail 98.7%

Unaddressed mail n.a.

Parcel mail 12.5% Many C6 – 55%

Express mail 50.6% Many C6 – 87%

Total (in volume) 94.8%

Note: * Addressed mail services are offered in combination with parcel and/or express services, not as a stand

alone activity. N.a. is not available.

1.5.4 Competition issues

Although the barriers to entry have been lowered and efforts are made to level the playing

field, competition is still limited in the addressed mail market. This is mainly related to

the strong position of Posta Romana because of:

• the reserved area;

• the existing collection and delivery network as well as the perceived better

knowledge of the terrain by postmen of Posta Romana;

• the perceived higher reliability of Posta Romana. Posta Romana employees that were

interviewed by the ECORYS project team mentioned that some (larger, business)

clients have left Posta Romana in favour of private service providers, but returned

shortly thereafter, as they judged the services of these latter providers as “not

reliable.” This perception is also fuelled by widely-publicised slips by CPOs. For

example, in 2007, one of these providers failed to deliver the monthly bills for a cable

TV/telephone company to more than 15,000 subscribers for three months in a row;14

• The more complicated price structure of CPOs (gasoline index, fees for delivering

services outside their coverage area).

The situation is different in the courier and express delivery market, where needs are

different and where CPOs thrive and continue to gain market share at the expense of

Posta Romana, despite the higher prices of CPOs (up to 2.5 times higher).15

14

“RCS & RDS regreta incidentul de la Constanta”, news release published on the RCS/RDS website, 31 July 2007,

http://www.rdsnet.ro/infocenter/evenimente.php?newsid=181. 15

Teodora Iuga. “The postman always rings twice: Are you selling or are you buying?”, article published in Business Week,

29.04.2008.


1.5.5 Results of competition

Competition is most profound in the parcel and express markets. In these markets there is

an increased product offering and improved customer orientation of operators. In the

addressed mail market competition is still limited. The main CPOs active in this market

have another core business activity (usually parcel mail and/or express). Developing

competition has provided an incentive to Posta Romana to undertake its current corporate

restructuring programme.

1.6 Customer needs

Customer needs are at the core of determining the business model and products offered in

the liberalised part of the postal market in Romania, where competition is highest. The

executives of courier companies pointed out that “value for money” is more important

than price for customers in this market segment. This explains why smaller companies

that initially try to penetrate the market by offering the lowest possible price do not

dislodge the larger (more expensive) private operators, because customer needs are a

combination of speed, reliability and flexibility.16

Posta Romana has published on its website statistics on customer complaints. In 2006,

out of the 21,436 complaints concerning domestic addressed mail, only 84 were

considered justified. Of the 5,737 complaints concerning parcels up to a weights of 10kg,

only 58 were considered founded and of the 8,312 linked to registered mail, all but 428

were dismissed as not founded.17

According to the information provided by the Consumer Protection Authority, of the total

number of complaints registered by Posta Romana, 42% had to do with the service

customers received at the postal offices (long waiting times, inadequate behaviour of

postal employees), 38% pertained to deliveries (late or damaged deliveries), and 20%

concerned correspondence.18

16

Bogdan Zafiu (Sales&Marketing Manager al TNT Romania ) and Adrian Mihai (Development Director at Fan Courier) cited

in “Piata de curierat, o piata de 240 de milioane de euro in 2008” (The courier market, a market of 240m euro in 2008),

published in The Marketer, June 2008. 17

According to Posta Romana, these numbers are very low when compared to the volume of items that Posta Romana

handles each year. However, it must be highlighted that complaints cannot be filed for non-registered mail, which

represents the bulk of the mail volume. 18

Information published in a factsheet called “Consumatorii şi rolul Autorităţii Naţionale de Reglementare pe piaţa serviciilor

poştale” (Consumers and the Role of the National Reglementation Agency in the Postal Services Market”),

http://www.protectia-consumatorilor.ro/fisiere/publicatii/Cap2-Supliment%20InfoCons.pdf (the site of the National

Association for Consumer Protection – a Romanian NGO).


1.7 Price performance

1.7.1 Tariffs

Table 0.19 Public tariffs (in Euro)

Postal product 2008 (RON) 2008 (EUR)

Letter post 1st and 2

nd class (up to 20g) 1 0.28


nd class (20-50 g) 1.6 0.44

Letter post cross-border, standard, non-priority (up to 20 gr) 1.6 0.44

Letter post cross-border: priority letter for Europe ( up to 20 g) 2.1 0.58

Letter post cross-border: priority letter for Europe (20-50 g) 3.3 0.92

Parcels, internal, under 10 kg 2.408 times no. of kg 0.67 times no. of kg

Parcels cross-border, average for sending to EU, priority 37.84+9.33 times

number of kg

10.51+2.59 times

number of kg

Parcels cross-border, average for sending to EU, non priority 37.63+6.9 times

number of kg

10.45+1.91 times

number of kg

Registered item, internal, with receipt confirmation, up to 20 g 4.4 1.22

Registered item, internal, with receipt confirmation, 20-50 g 5.1** 1.42

Bulk mail, 20g (advertising, addressed)*** 1 0.27

Bulk mail, 100g 2 0.55

Bulk mail, 300g 4.5 1.25

Source: Posta Romana website, Tariffs calculators.

Note: The exchange rate used for these tariffs is 3.6 Ron=1EUR. *** Includes VAT of 19%.

Table 0.20 Public tariffs (in PPP)

Postal product 2008


nd class (up to 20g) 0.49


nd class (20-50 g) 0.80

Letter post cross-border, standard, non-priority (up to 20 gr) 0.80

Letter post cross-border: priority letter for Europe ( up to 20 g) 1.05

Letter post cross-border: priority letter for Europe (20-50 g) 1.67

Parcels, internal, under 10 kg 0.67 times no. of kg

Parcels cross-border, average for sending to EU, priority 19.05 + 2.59 times no. of kg

Parcels cross-border, average for sending to EU, non priority 18.94 + 1.91 times no. of kg

Registered item, internal, with receipt confirmation, up to 20 g 2.21

Registered item, internal, with receipt confirmation, 20-50 g 2.57

Bulk mail, 20g (advertising, addressed)*** 0.49

Bulk mail, 100g 1.00

Bulk mail, 300g 2.27

Source: conversion rate based on Eurostat data (forecast for 2008).

By way of example, the table below illustrates the price structure of one of the larger

CPOs in Romania, Curiero.


Table 0.21 Tariffs for addressed and unaddressed mail of one of the CPOs (2008)

Type of service Weight Price per unit (RON) Price per unit (EUR)

Correspondence 0-50g 2 0.55

(in reserved area)

51-250g 2 0.55

251-500g 2.7 0.75

501-700g 3.5 0.97

Unaddressed advertising

mail 0-50g 0.2

0.055

51–250g 0.3 0.083

251-500g 0.5 0.023

501-700g 1 0.28

Source: CURIERO website.

1.8 Employment aspects

1.8.1 Employment

In 2006, 43,299 employees have been working in the Romanian postal market. The

contribution of the postal sector to employment in Romania is approximately 0.5%.19

Out of these employees, 34,935 worked for Posta Romana, which equals 80.7% of the

total personnel employed in the postal sector. In 2005, there were 43,116 employees in

the total market, of which 36,281 (= 84.1%) worked for Posta Romana.20

For an

overview, see Table 0.2222.

Table 0.22 Employment in the sector, in employees and [FTE]

Operator 2005 2006

Posta Romana 36,281 34,935

Competitors (total) 6,835 8,364

Total 43,116 43,299


Calculating the changes in employment, we note an increase of 22% of employment for

competitors’ postal operators from 2005 to 2006, while Posta Romana registered a

decrease by 3.7% in the number of employees.

19

43,299 employees divided by 8.97 million jobs. Source jobs: CIA fact book. 20



Table 0.23 Employment by universal service provider per segment, total and [% flexible]

Postal product 2005 2006

Mail n.a. n.a.

Express n.a. n.a.

Logistics n.a. n.a.

Total 36,281 34,935


Note: n.a. is not available.

1.8.2 Employment conditions

We have no information on wage developments, wages as a proportion of total costs or

developments in job requirements.

1.8.3 Productivity

Productivity, defined as total traffic of postal items divided by the number of employees

in the postal sector, was 13,310 in 2006.

If we measure productivity for Posta Romana in the same way, we get an average

productivity of 15,640 in 2006.21

This is an increase of 24% compared to 2005, when

productivity of Posta Romana was 12,570.22

Table 0.24 Productivity (in items/FTE)

Operator 2005 2006

USP 12,570 15,530

Sector average 13,310

Source: ANRCTI report Analysis of the postal market 2006.

Note: The data for the USP include the bulk of regular addressed mail items, while competitors are more active

in courier, express and parcel mail.

The other authorised providers registered in 2006 an average of 3,573 postal items per

employee. Compared to 2005, when the annual average was 4,963 postal items per

employee, this is a decrease of 28%.

On the market of courier services, the productivity of Romanian employees seems to be

significantly lower than that of their European competitors. Courier firms estimate that a

Romanian courier delivers 30-35 items per day. In Austria, the “norm” is around 80

deliveries per day whereas in Germany the figure is circa 120 deliveries per day.23

21

Productivity is calculated by dividing total mail volume (546.4 million items) by number of employees (34,935). 22

Mail volume of 456.1 million items divided by 36,281 employees. 23

Teodora Iuga. “The postman always rings twice: Are you selling or are you buying?”, article published in Business Week,

29 April 2008.


1.9 Technological developments and environment

1.9.1 External

We have no information on the percentage of letter mail in the communications market.

1.9.2 Internal

In 2007, Posta Romana was to receive funds from UPU to start implementing the IPS

system in its International Exchange Bureau. It was also going to finalise an agreement

with EBRD in order to obtain funds to invest in a technological upgrade of the Regional

Transit Centre in Cluj (second biggest city in Romania) and to build a new transit Centre

in Bucharest.24

Posta Romana started negotiations to get access to the REIMS EAST system which

consists of a transition agreement to minimise the impact on new members of the EU of

switching from the UPU fee system to the REIMS system.25

There is still very little automation in the postal sector in Romania, although exact figures

can not be given. The little degree of the use of modern technologies is also illustrated by

the fact that in the entire country, only 52 Posta Romana offices have a franking machine.

The Annual Report 2006 mentioned that 771 units (of the total of more than 7000) were

connected to the Virtual Private Network, with an additional 354 connected through dial-

up connections. The majority of investments in 2006 had gone into upgrading the

working space/ conditions of employees, mostly by introducing independent heating units

to replace older, inefficient equipment.

The situation is not much different within CPOs. In 2007, CURIERO was investing about

€3m in more transport vehicles and weighing machines, which at that time were not fully

integrated in their network. The president of CURIERO declared in a press article that

currently about 20% of any courier business in Romania is lost as a result of transported

items not being weighed.26

1.9.3 Environment

No information is available on the environmental policies of Posta Romana.

24

Posta Romana Annual Repot 2006, p. 43 (Section: Perspectives for 2007). 25

Ibid. 26

“Curiero vrea o marja de profit de 10-11% in 2008” (Curiero wants a profit margin of 10-11% i n 2008 published in Wall

Street Juornal 24/01/2008, access online 31/07/2008 http://www.wall-street.ro/articol/Companii/37330/Curiero-vrea-o-

marja-de-profit-de-10-11-in-2008.html.


1.10 Sources

• Annual Report Posta Romana 2001.

• Postal Law 2006.

• ANRC Annual Report 2003, December 31 -2003.


• ANRC Activity Report 2004, August 2005.


• Statistical data 2004, Romanian market of postal services, April 2006.

• 2005 STATISTICAL DATA REPORT, Romanian market of postal services, October

2006.

• ANRCTI Activity Report 2005, August 2006.

• ANRCTI REPORT ON THE ROMANIAN POSTAL SERVICES MARKET IN

2006, October 2007.

• Annual Report, Posta Româna, 2006.

• “Curiero”website (competitor)

• “Curiero wants 10-11% profit margin in 2008”, article of 24/01/2008.

• Teodora Iuga. “ The postman always rings twice: Are you selling or are you

buying?”, article published in Business Week, 29.04.2008.

• Information sheet on Postal Services and Consumer Protection.

• “Statistica reclamaţiilor adresate C.N. Poşta Română S.A. în anul 2006 aferente

serviciilor poştale din sfera serviciului universal” published on the official site of

Posta Româna www.posta-romana.ro

• “Piata de curierat, o piata de 240 de milioane de euro in 2008” (The courier market, a

240 million EUR market in 2008) , in The Marketer, June 2008.

• National Association for Consumer Protection Agency (Romanian NGO)

“Consumatorii şi rolul Autorităţii Naţionale de Reglementare pe piaţa serviciilor

poştale” (Consumers and the Role of the National Reglementation Agency in the

Postal Services Market”), factsheet accessed online August 2008.

Documents

Country sheet: Romania - CIRCABC - Welcome · PDF fileCountry sheet: Romania 779 Aspect Implementation and remarks Universal service and its financing The universal service consists