Dutch government doesn't have to pay PostNL €30 mil. advance on rejected subsidy: Court

The Ministry of Economic Affairs does not have to pay PostNL a €30 million advance on a subsidy the postal company requested to continue its legally-obligated duty to deliver the post, the Administrative High Court for Trade and Industry (CBb) ruled on Friday.

PostNL asked the court to force the government to pay it a €30 million advance on a €68 million subsidy it applied for. According to PostNL, delivering the mail, which it is legally obliged to do, has become loss-making, and it needs financial support for this year and next.

The Minister rejected the subsidy application, instead opting to relax the obligations of the Universal Postal Delivery Service (UDP), a range of delivery services that must be available and affordable ot everyone. Instead of having to deliver the mail within 24 hours, PostNL will have 48 hours to do so. The government also gave the postal company more room to set the rates for its national delivery network.

PostNL argued that these measures were too little and too late for mail delivery to become financially stable, and asked the court to intervene. The company also asked the CBb to order the government to pay it an advance while the court considers the entire subsidy.

But the CBb denied the request. The court and the government don’t deny that the costs of mail delivery are rising and that structural measures are needed to keep the service up and running. But national and European law gives the Minister “considerable discretion in choosing measures” to ensure this. And that includes opting for relaxing the UPD obligations instead of financial support, the CBb said.

“The preliminary relief judge is not convinced that PostNL’s situation has become so dire that the Minister must provide financial support now or PostNL’s operations wil face difficulties,” the court said.

The CBb added that it understands PostNL’s “concerns about the extent and pace at which the Minister is implementing structural measures.” It reminded the government that it is its responsibility “to tackle this with the necessary speed.”