DHL 2014 Annual Report Download - page 96
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Please find page 96 of the 2014 DHL annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Categories of opportunities and risks
Opportunities and risks arising from political, regulatory or legal conditions
Some risks arise primarily from the fact that the Group provides some of its services
in a regulated market. A large number of postal services rendered by Deutsche Post
and its subsidiaries (particularly the Post - eCommerce - Parcel division) are subject to
sector-specic regulation by the Bundesnetzagentur (German federal network agency) pur-
suant to the Postgesetz (PostG – German Postal Act). e Bundesnetzagentur approves or
reviews prices, formulates the terms of downstream access and has special supervisory
powers to combat market abuse.
On January , the European Commission issued a ruling on the formal in-
vestigation regarding state aid that it had initiated on September . In its review,
the European Commission determined that Deutsche Post was not overcompen-
sated for providing universal services between and using state resources. It
also did not nd fault with the state guarantees for legacy liabilities. By contrast, in its
review of funding for civil servants’ pensions, the European Commission concluded
that illegal state aid had, in part, been received. It said that the pension relief granted
to Deutsche Post by the Bundesnetzagentur during the price approval process led
to Deutsche Post receiving a benet, which it must repay to the Federal Republic of
Germany; in addition, it must also be ensured that no benets are received in the future
which could be considered illegal state aid. e Commission furthermore stated that
the precise amount to be repaid was to be calculated by the Federal Republic. In a press
release, the European Commission had referred to an amount of between mil-
lion and billion. Deutsche Post is of the opinion that the Commission’s state aid
decision of January cannot withstand legal review and has led an appeal with
the European Court of Justice in Luxembourg. e Federal Republic of Germany has
similarly appealed the decision.
To implement the state aid ruling, the federal government called upon
Deutsche Post on May to make a payment of million, including interest.
Deutsche Post paid this amount to a trustee on June and appealed the recovery
order to the Administrative Court. e appeal, however, has been suspended pending a
ruling from the European Court. e company made additional payments of . mil-
lion, . million and . million to the trustee on January , January
and January , respectively. e payments made were reported in the balance sheet
under non- current assets; the earnings position remained unaected. e European
Commission has not expressed its nal acceptance of the calculation of the state aid to
be repaid. On December , it initiated proceedings against the Federal Republic
of Germany with the European Court of Justice to eect a higher repayment amount.
If the appeals issued by Deutsche Post or the federal government against the state
aid ruling are successful, the opportunity exists that the payment of million and the
payments of . million, . million and . million made in addition – aswell as
the additional annual payments of around million to be made in the future – will be
returned. A repayment would only aect the liquidity of Deutsche Post ; the earnings
position would remain unaected.
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Deutsche Post Group — Annual Report
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