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Yesterday — May 13th 2021Your RSS feeds

Postal wars: SA Post Office and courier industry to battle over right to deliver small packages

May 12th 2021 at 10:54

The Democratic Alliance (DA) has criticised the South African Post Office (SAPO) and the Independent Communications Authority of South Africa (ICASA) for attempting to stop courier companies from delivering small items that weigh less than one kilogram.

SAPO, Postnet and the SA Express Parcel Association will face off in court later this year. However, for now things remain as they are in the courier industry.  The DA’s Deputy Shadow Minister of Communications, Cameron MacKenzie accused SAPO trying to have its cake and eat it too.

SAPO MONOPOLY

In 2018 SAPO complained that PostNet was contravening the Postal Services Act of 1998 by delivering packages and postal articles that weigh less than a kilogram. The post office claims this service is reserved solely for it.

The Act says SAPO is South Africa’s only licensed postal service operator and is solely responsible for the delivery of all letters, postcards, printed matter, small parcels and miscellaneous postal items up to 1kg. In late 2019, ICASA’s Complaints and Compliance Commission (CCC) backed SAPO in this matter and echoed what is stated in the act but said food is the only exception. They found that PostNet had contravened the Act by operating a reserved postal service without a license.

“The CCC thus finds that the one kilogram and less limitation is constitutionally justifiable and that the intention of parliament is clear: no one is permitted to transport or deliver reserved postage… Presently only the South African Post Office is licensed to do so.”

ICASA served PostNet with a cease and desist letter in October 2019. In response, PostNet sought an urgent interdict against the order from the Gauteng court, which allowed it and other courier companies to continue delivering small items until the matter has been heard in full.

The legal documents said the interpretation of the Postal Services Act lies at the core of PostNet’s argument, which will be very important when this matter is finally heard in court later in 2021.

‘IT’S A MONOPOLY OR A SUBSIDY; IT CANNOT BE BOTH’

The South African Post Office reportedly received R475 million in March 2020 from the government to make sure it is able to meet its obligations.

“Despite this support from government, SAPO is intent on having its cake and eating it – securing hundreds of millions in an annual state subsidy while still pushing for its monopoly to be enforced,” said MacKenzie.

ICASA said the purpose of affording SAPO a monopoly is to fund its obligation to roll out universal postal services. “There is no doubt that the Postal Services Act 1998 has created a monopoly in favour of SAPO. The monopoly is clearly intended to place SAPO in a financial position to widen the availability of postal services throughout the country; a country, the large majority of the people of which has been wracked by and is still, inter alia, suffering economically from the pre-1994 apartheid past.”

MacKenzie argues that the rationale for enforcing the monopoly falls away  because of the subsidy SAPO receives from government. However, he added that the 530 branches of the postal service that are situated in deep rural and under-serviced communities are the ones that should be eligible for government funding.

“As SAPO claims it cannot meet its mandate without enforcing this monopoly, government must, in the Telkom tradition, seek out private sector partners capable of taking over the business and transforming it into an entity that can meet its mandate – to deliver, whatever it takes. For now, it’s a monopoly or a subsidy; it cannot be both,” said MacKenzie.

Before yesterdayYour RSS feeds

SA Post Office: These branches are now open after landlord negotiations

May 10th 2021 at 06:20

The South African Post Office (SAPO) announced the reopening of some of the branches that were temporarily shut during extensive negotiations with the owners of their buildings. Earlier this year SAPO announced the closure of approximately 53 branches countrywide because of payment disputes.

POST OFFICE BRANCHES TO REOPEN ON 10 MAY

Twenty-seven post office branches in seven provinces will resume normal trading from Monday, 10 May after their temporary closure earlier this year. SAPO said negotiations with the landlords of the branches that remain closed are continuing, adding that they are expected to also resume operations, within the next few weeks, once an agreement is reached with property owners.

“Post Offices are important access points for government services such as social grants. To eliminate long waiting times, the Post Office has introduced separate queues for different transactions,” said SAPO.

The parastatal added that the separate queues also serve as a way of preventing crowding and mitigating the spread of COVID-19.

The SAPO branches reopening on 10 May are:

  • Gauteng: Aston Manor, Belle Ombre (Pretoria), Fontainebleu, Hillbrow, Kelvin, Khumalo, Leondale, Moroke, Northmead, Three Rivers
  • Eastern Cape: Greenfields, Motherwell, Northcrest, Schauderville
  • Western Cape: Edgemead, Kleinmond, Mbekweni, Melkbosstrand
  • KwaZulu-Natal: Esikhaleni, Gilits, Impendle, Overport
  • Limpopo: Enkelbult, Letsitele, Tonga
  • Mpumalanga: West Acres (Mbombela)
  • Northern Cape: Hopetown

EYEING SA’S COURIER SERVICE MARKET

SAPO claims that the Post Office is the most cost-effective way of delivering small international shipments and therefore it is planning to expand its role in the e-commerce sector. “Its network of outlets is one of the reasons it is able to offer a unique service, and the organisation intends to maintain its extensive network.”

Chinese e-commerce giant, Wish, recently announced a direct partnership with SAPO, which will reportedly improve transit times up by up to 50% and allow customers to receive bundled shipments when ordering multiple items. “This is critical to ensuring a positive customer experience and satisfaction and will enable us to better serve our customers in this market,” said Wish’s vice-president of operations, Thomas Chaung.

The Independent Communications Authority of South Africa (ICASA) recently backed up the post office’s right to monopolise the delivery of all packages weighing 1kg and less – except for food – in a matter that dates back to 2018.

SAPO alleged that Postnet – and by virtue other courier services – were contravening the Postal Services Act of 1998 by offering services reserved solely for SAPO. According to the Act, the post office is the country’s only licensed postal service operator and is responsible for the delivery of all letters, postcards, printed matter, small parcels and miscellaneous postal items up to 1kg.

Postnet, however, lodged an urgent interdict against ICASA’s ruling, which allows it and other companies to continue to delivering smaller packages until the matter is heard in full in court. A date for the hearing is yet to be set, according to Mybroadband.

Post Office branches re-open after negotiations with landlords

May 8th 2021 at 12:04
The SA Post Office announced the reopening of most branches that were temporarily closed following extensive negotiations with landlords.

Please SA Post Office, stay in your (terribly managed) lane

May 7th 2021 at 05:58

You’ve got to hand it to South African state-owned entities. They may not have tremendous management skills, but they can certainly identify a cash cow to bleed dry.

The thing is, cows don’t only give you milk, if you farm them right they also provide more cows, so bleeding them dry might not be a fantastic idea in the long run.

It’s just that everybody believes that the cash cow being bled dry by Sapo’s ridiculous position – where they don’t want private couriers delivering packages less than 1kg – will only harm the couriers. Maybe it will, but it will likely harm South Africans even more.

Almost every industry thrives most when it is accessible, so access to fast, efficient and cost effective parcel delivery is key.

Small businesses manufacturing goods to those making food and countless others, are key functional drivers of our economy. A massive part of their success is their ability to get their goods to the end user.

Now the post office has an insurgency tactic to make it the only service provider of “choice”, while struggling to pay rent and despite billions in government bailouts over the past decade.

Spare me. Also correct me if I’m wrong, but I don’t remember the private couriers ever being gifted with a cent in tax funds, yet they still seem to be able to deliver.

Dear old Sapo has lost it. This act of forcing their relevance to continue is just throwing twigs into a fledgling ember.

I understand that the law does prevent unlicensed couriers from delivering small mass parcels, but instead of blocking them, lobby for them. If they’re doing a better job, there’s no point to standing in their way.

In the Icasa case where this legal position was clarified, the finding even referred to the purpose: “The intention of Parliament was to protect Sapo against competition within the kilogram and less postage.”

But let’s face it, it’s not like protecting Sapo against competition is doing South Africans any good. In fact, it’s cost them billions already, so why would we allow this to go on?

Over in the US, Nasa realised the potential of the private sphere and instead of fighting it, lobbied for it and, guess what? The people benefit. It’s probably because Nasa is smart and realised that no matter how much it fights progress, it will lose to the detriment of its people.

So, instead, it offered support to the private sector and ensured the private sector plays within the bounds that are beneficial to the population.

It’s a good system. But not to Sapo. No, no, no. Disappointingly, seemingly not to Icasa either.

It’s not like these entities don’t have a history of lobbying for policy change. Think sports licensing, bans on broadcasting protest violence and a whole lot more. These national entities could lobby for a shift in policy, or even afford licences to private couriers, but they don’t.

I’m willing to disregard all of this. Perhaps I’d even be willing to give Sapo and its new management a chance if they just showed a little bit of brain with their legislative brawn. I just know they won’t, because it’s an entity that is old, lazy and unimaginative.

Their biggest brag this year, if you’re willing to ignore their difficulties in paying rent, is a back end integration with Chinese distributor Wish, or as they call it, a “strategic partnership”.

I’m unconvinced it’s worthwhile to brag about a bit of back end code a 16 year old could write in a weekend while you’re struggling to pay your bills. I’ll refrain from asking what they actually paid for that strategic partnership to work, because I know it will depress me.

And, sadly, that is not the most depressing thing about this saga. That award must go to the imbecilic notion that this plan is ever going to work in favour of Sapo. I wish they just had some sort of foresight into the effects of their actions.

So long as they can’t provide services  we’re used to getting reliably from private couriers, all Sapo will be doing is fuelling the market for 999g rocks, which will cost us all in the end.

Before Sapo starts flexing its unearned muscle in the market, it needs to show that it can deliver to that market and, well, I’m not convinced…

So, to quote an apt idiom, Sapo shouldn’t be concerning itself with breaking a functional industry to fail at saving itself. It should be concerning itself with the dichotomy of shaping up or shipping out.

Richard Anthony Chemaly. Entertainment attorney, radio broadcaster and lecturer in communication ethics.

The Post Office must deliver all packages under 1kg, but not food – ICASA

May 6th 2021 at 11:30
ICASA has reiterated that South Africa's postal laws determined that only the SA Post Office may deliver packages weighing 1kg and less, although this does not include food. 

Takealot under threat from an ‘invisible enemy’

May 6th 2021 at 07:22
South African online retailers like Takealot are under threat from an 'invisible enemy' which is rapidly gaining momentum in South Africa.

If the Post Office wants a monopoly, give it one

May 5th 2021 at 12:30
The Post Office is mounting a campaign to enforce its monopoly over the delivery of small items. If it gets its way, it will inflict long-lasting damage on South Africa’s fledgling e-commerce industry. By Duncan McLeod.

The Post Office wants to take on South Africa’s couriers – while it’s commercially insolvent

May 2nd 2021 at 03:59
The South African Post Office wants to become a prominent player in the country’s courier industry, despite the fact that the Auditor-General has declared it commercially insolvent.

The SA Post Office wants to stop couriers from delivering many common items

April 26th 2021 at 09:29
The Post Office is claiming the exclusive right to deliver items weighing less than 1kg in South Africa, including bank cards, smartphones, and medication.

SA Post Office signs deal with US online shopping giant to improve deliveries

April 21st 2021 at 09:50
Online shopping retailer Wish has announced a strategic partnership with the South African Post Office to strengthen its logistics capabilities and customer experience for South African consumers.

SA Post Office commercially insolvent – Report

April 14th 2021 at 03:40
Auditor-General Tsakani Maluleke has found that the South African Post Office is commercially insolvent.

Q&A Sessions: ‘Post Office was a journey of faith’

February 12th 2021 at 14:00
By: Eyaaz

Mark Barnes, the former South African Post Office chief executive, talks to Nicolene de Wee about the highlights of his 30-year career in finance and markets. The 64-year-old father of six discusses the country’s financial services sector, his art collection and his love for trout fishing

The post Q&A Sessions: ‘Post Office was a journey of faith’ appeared first on The Mail & Guardian.

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