‘Survival of the Fittest” in the Declining Market of Postal Services: the Chilean Case from a Comparative Perspective.

Abstract

: This essay seeks to analyse the declining market of postal services of letter delivery as a network industry, specifically in the Chilean market, and contrasting its features with those of different countries through the jurisprudential analysis of competition law cases. These show some remarkable common features with the last competition law case on Chile’s postal services market, despite being taken from different jurisdictions (Denmark, UK and Spain). For this purpose, we will briefly analyse the market of postal service as a network industry and the declining performance of the segment of letter-post delivery. We will furthermore analyse the specific features shown in Chile’s market of letter-post delivery, its legal and regulatory framework, its market structure, and the implications of said structure for competition, covering the market concentration, economies of scale and sunk costs. Then, we will briefly and generally conceptualise the presence of retroactive conditional rebates in the context of postal services. Finally, we shall contrast different competition law cases that have taken place regarding this segment of the market, in order to answer the question of the reason for the declining feature of the letter-post delivery market and whether this has lead more dominant firms to incur in anticompetitive practices, such as discriminatory prices or retroactive conditional rebates.