Deutsche Post World Net files suit against decision of the EU Commission

Bonn, Germany (ots) - Deutsche Post World Net will file a suit before the European Court of Justice against the decision on state aid released today by the EU Commission. Dr. Klaus Zumwinkel, Chairman of the Board of Management, is very confident about the outcome of the proceedings. "The Commission's decision is so clearly disputable that only a judgement in favour of Deutsche Post is conceivable," he stated. Zumwinkel again confirmed without reservation that Deutsche Post used neither unauthorized cross-subsidies nor unlawful state aid for its business parcel division.

The Group accused the EU Commission of applying double standards in reaching its decision. It stands in blatant contradiction to the Commission's decision on state aid in Italy as well as in Ireland at the beginning of 2002. In the case of the Italian post office for example, a total of Euro 25 billion in state benefits, of which around Euro 16 billion were intended to cover so-called historical inefficiency costs, were fully approved by the Commission. "In contrast, Deutsche Post, which has successfully restructured and is therefore profitable, is being punished by a totally incomprehensible repayment decision," said Zumwinkel. "We demand the same legal and political treatment as other European postal companies and intend to pursue this by filing a suit in the European Court of Justice."

At the same time, the Group's Chairman noted that the current decision cannot be brought into line with previously concluded competition proceedings against Deutsche Post regarding the same matter. In that case, after years of investigations into the question of possible cross-subsidies, the EU Commission was forced to refrain from fining the company. "It cannot be," said Zumwinkel, "that the same facts be evaluated in a totally different manner in other proceeedings".

In the latest decision the EU Commission treats the alleged cross-subsidisation of under-absorbed costs in the business parcel division (1994 - 1998) as actual state aid. However, the EU Commission has neither determined nor proven that this alleged cross-subsidisation was actually financed from state aid. In order to identify state aid of this kind the EU Commission would first have had to determine that the total amount of state aid received exceeded the total burden incurred by the universal service. Only in such a case can there be any talk of state aid, not only under the ECJ's current jurisdiction (Ferring ruling), but also under the most recent decision on state aid in connection with the Italian and Irish postal companies. To date the EU Commission has not calculated Deutsche Post's added universal service burden. In this respect there is definitely no evidence of state aid.

Additionally, Deutsche Post World Net cites a whole series of procedural errors and legal inconsistencies in the latest decision. In Deutsche Post's opinion, there was a serious procedural error in that the EU Commission considered the distribution of assets between Deutsche Telekom and Deutsche Post in 1995 to be state aid. Not a single word on this aspect was mentioned in the opening order. Therefore, to ensure a legally proper hearing for Deutsche Post, there should have been a formal addendum to the opening order. If not, this presents a serious procedural error which per se would have to lead to the annulment of the ruling.

As a result of the ruling, until a decision is taken by the ECJ for the Group Deutsche Post World Net is preparing to bear extraordinary expenses of approximately Euro 850 million (repayment plus interest). Given an operating profit of almost Euro 2.5 billion, this one-off payment corresponds to almost one-third of the net profit for the period.

We move the world. With its brands Deutsche Post, DHL, Danzas and Postbank, Deutsche Post World Net is one of the largest high-performing logistics companies in the world. Over 300,000 employees generated revenues of Euro 33.4bn in 2001. The Group offers integrated solutions for domestic and international customers. These include worldwide mail, parcel, express and logistics services, innovative eBusiness solutions and a broad range of financial services. Deutsche Post World Net successfully went public in the autumn of 2000. Its stock was quoted for the first time on 20 November 2000. On 19 March 2001 Deutsche Post World Net joined the Deutsche Aktien Index (DAX 30), placing its stock among the 30 most important stocks in Germany.

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