PostNL: USO proposal unworkable, structurally loss-making and not economically viable

• The ACM postal market study and the letter from the Dutch Minister of Economic Affairs confirm the urgent need for change
• Loss-making public service is carried out without compensation
• PostNL’s first move is to appeal and initiate preliminary proceedings against the rejection of financial compensation
• PostNL is urging workable standards and a future-proof, affordable postal service

PostNL concludes that the Dutch government’s proposal for the universal service obligation (USO) is insufficient for a future-proof postal delivery service. While mail delivery within two and, over time, within three days is a step in the right direction, the proposal imposes unworkable standards and leaves crucial issues unresolved. Moreover, it offers no solutions for the costs that PostNL currently incurs within the existing USO framework nor for the transition to a future-proof model. As long as these high USO costs rest entirely with PostNL, it remains impossible to adapt the mail business model, and the postal service will remain loss-making for years to come. PostNL will therefore appeal the government’s rejection of financial compensation and will initiate preliminary proceedings asking for an advance payment for financial contribution over for the 2025 and 2026. PostNL does not rule out further legal action should essential improvements fail to materialise.

Pim Berendsen, PostNL’s CEO: “We appreciate the new minister’s commitment to the public importance of postal service and the speed with which he has put forward a proposal for change. That said, the proposed changes are too little, too late.”

Proposal ignores need to future-proof postal service

A study by the Authority for Consumers and Markets (ACM) shows the current situation is unsustainable and change is to be urgently needed. The government’s proposal to allow letterbox mail to be delivered within two days from 1 July 2026, and within three days from 2029, is a step in the right direction, but not a solution. The public service will remain loss-making until at least 2029. Financially sustainable performance will only be possible upon full implementation of delivery within three days with realistic and affordable standards.

The proposed quality standard of 95% for USO mail is unworkable in practice due to the labour-intensive nature of mail delivery. Reliability is also important to PostNL, which is why the company advocates a swift change to a 90% standard which is above the current level and strengthens quality.

This combination of high standards and absence of any financial compensation means the execution of the USO remains costly. As a result, the postal service will remain loss-making until at least 2029, jeopardising the continuity of the Dutch postal service. As pointed out by the ACM, and confirmed by the former Minister, a company cannot be expected to continue delivering a loss-making public service. Furthermore, the proposed timelines are highly uncertain, not least because of the current political situation.

PostNL to appeal the government’s rejection of its subsidy application

The current Postal Act dates from 2009, while a revision has been pending with Dutch parliament since 2020. In October 2024, when decision-making was again postponed, PostNL applied for temporary contributions of €30 million (2025) and €38 million (2026) to be able to continue fulfilling its legal USO obligations, including delivery within one day of letters, the minimal required number of nationwide post boxes, separate processes for bereavement and medical mail, and free braille mail.

Under European law, the provider in charge of a public service is entitled to compensation if and when public obligations impose a disproportionate financial burden. In a lot of other European countries, postal companies receive support through subsidies, tax advantages and/or other arrangements, with USO obligations being significantly less demanding than in the Netherlands. With the minister having rejected the request for financial compensation, PostNL is forced to appeal this decision and request an advance payment through preliminary proceedings.

PostNL calls for future-proof postal service

Pim Berendsen: “We can’t continue to carry out the USO under the proposed conditions. We appreciate this minister’s commitment and decisiveness, but these measures are too late, do not solve the challenges of a declining postal market and leave many uncertainties. The postal service plays an important societal role. We fulfil the USO with heart and soul. That’s precisely why it is necessary to move with the times, so we can keep mail delivery for 18 million Dutch citizens and jobs for 20,000 postal workers sustainable, reliable and accessible. The current proposal imposes unnecessarily high costs on PostNL without any compensation. We are being asked to maintain a network that no longer fits today’s demands. And that is unsustainable. I call on politicians not to let uncertainty persist in the run-up to the elections regarding the introduction of new USO conditions and the necessary funding, so that thousands of employees across the Netherlands can continue delivering a future-proof postal service, through rain or shine.”