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Royal Mail faces French anti-competition probe

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By John McCarthy, Opinion editor

July 16, 2014 | 2 min read

The Royal Mail has been informed by French competition authorities that it could face a fine of up to £160m if a company subsidiary breached antitrust laws.

The French GLS wing is under investigation

The newly privatised Royal Mail announced that its French GLS business, which is one of Europe’s largest parcel distribution services, is being investigated due to a potential breach of French anti-competition laws.

The Autorité de la Concurrence is also probing the dealings of FedEX, and Dutch company TNT Express also received similar warnings.

After the news, which emerged during a stock market announcement, early trading saw Royal Mail shares drop by 1.8 per cent to 480 per cent.

The Royal Mail, said: “We are currently considering the notice received from the French regulator. Given the early stage of this matter, we cannot yet determine the amount or range of potential loss; however, it is possible that it could be material.

The postal service said it would provide updates on the investigation “at the appropriate time”.

French law states that the fine could claim as high as a maximum of ten per cent of world turnover for the companies involved - which could spell a fine of £160m for Royal Mail and £529.5m for TNT Express.

The GLS wing of Royal Mail is highly profitable and has substantially stabilised company revenue through the much critisised privatisation period.

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