Neither the Carrot nor the Stick: How to Ensure Adequacy of Traditional Postal Operators’ Funding in a Rapidly Transforming Market

The chapter delves into the transforming postal services market, marked by a decline in letter mail and a surge in parcel deliveries. Traditional postal operators are grappling with the financial sustainability of universal service obligations (USO) while adapting to new operational and customer behavioral shifts. The text explores the need for significant investments in infrastructure and technology to support parcel delivery growth and meet environmental sustainability goals. It also examines the complexities of alternative funding mechanisms, including governmental aids, private financial loans, and EU recovery plans, and the potential competitive distortions these funds may create. The chapter highlights the challenges in ensuring fair competition within the market and proposes recommendations to mitigate these distortions, emphasizing the need for comprehensive scrutiny of funding sources and their impacts on the market.