An Post is taking legal advice after discovering that several companies are posting mail to their Irish customers via Britain in order to avail of cheaper rates.
Companies can save thousands of euros by transferring their mail to Britain and getting the Royal Mail to post it back to Ireland. Companies can get rates of between 27 cents and 30 cents per letter in Britain; whereas it costs 39 cents a letter to post bulk mail within the Republic.
If a company sends 220,000 letters via Britain to its Irish customers it could save up to €22,000. For companies using regular mailshots during the year, savings could be significant.
Companies can transfer mail to Britain electronically. When it reaches its destination in Britain the mail can be printed out, put in envelopes and sent back to Ireland at the cheaper postal rate.
A spokesman for An Post said companies registered in Ireland must put their mail through the Irish postal system. "If the post originates here, it must be posted here," said the spokesman.
First Active posted thousands of letters via the British postal service to the Republic in August. The letters carried a Royal Mail postmark and said "postage paid Great Britain".
A spokesman for the bank said it needed to use the most cost-effective postal option and it believed its actions were lawful. He declined to comment further.
A spokesman for An Post said several companies were engaging in the practice, but First Active was the largest, posting over 200,000 letters during August. An Post declined to disclose the names of companies posting mail via Britain.
An Post is currently trying to address serious financial difficulties, with at least 1,500 staff expected to be made redundant.
While losses in its main Irish letter post division have contributed to these problems, losses in its inbound international mail business (which includes post from Britain) amounted to €13.2 million in 2002.
ComReg, the regulator for postal and telecoms services, said it was aware of the practice of companies posting to Irish customers via Britain.
It said An Post was not recovering the full amount for processing letters that come into Ireland from Britain and elsewhere. ComReg has called on An Post to renegotiate an agreement called REIMS II, which governs the charges between postal services around the world.
ComReg said in a recent document that the failure to correct losses in the inbound division could affect An Post's its ability to provide its universal service in the Republic. ComReg raised concerns about the losses in the inbound business during the recent discussions about a potential An Post price rise.
