DHL 2010 Annual Report Download - page 106

RISKS
Risk categories and specifi c risks
 e risks set out in the following are those which we presently consider to have
asigni cant, potentially negative, impact on our earnings,  nancial position and assets
and liabilities.  ey are not necessarily the only risks to which the Group is exposed.
Our business activities could also be adversely a ected by additional factors of which
we are currently unaware or which we do not yet consider to be material.
Risks arising from the political and regulatory environment
Risks associated with the general business environment primarily arise from the fact
that both the Group and its subsidiaries provide some of their services in a regulated
market. Our statutory exclusive licence was abolished in Germany on  January .
However, the Postgesetz (German postal act) had allowed exceptions enabling competi-
tors to operate within the weight and price ceilings laid down in our exclusive licence
from January  onwards. By the end of , the regulatory authority (Bundes-
netzagentur – German federal network agency) had issued licences to approximately
,competitors, around  of which operate in the market.
On  November , the regulatory authority announced a benchmark decision
specifying the conditions that would apply from  until the end of  to regulation
under the price-cap procedure for mail prices requiring approval.  is stipulates the
general rate of in ation and the expected productivity growth rate for Deutsche Post 
as the key factors applicable to mail prices subject to approval. Prices must be lowered
if the in ation rate in the reference period is lower than the productivity growth rate
speci ed by the regulatory authority. Individual mail prices requiring approval had to
be lowered for  to meet these speci cations.  e regulatory authority accepted an
application from Deutsche Post  to this e ect on  October .  e regulatory
authority will establish the conditions e ective from January  for regulating mail
prices requiring approval in a price-cap procedure during the course of .
 e third European Union  Postal Directive came into force on  Febru-
ary .  e Directive requires most  member states to open up their markets by
, although the nine most recent members plus Greece and Luxembourg have the
option to defer the opening of their markets until . Until then, the previous limits
continue to apply across the , with reservable services restricted to a maximum of g
or two-and-a-half times the standard letter price. It is now possible to plan with certainty
for the future regarding the date by which all national monopolies in Europe must fall.
Whilst liberalisation of postal markets entails risks for Deutsche Post  due to
increased competition in Germany, it also opens up new opportunities in other European
postal markets. In , Deutsche Post  participated in cross-border mail exchange
with  European postal operators on the basis of the  agreement.
Glossary, page 
Glossary, page 
Glossary, page 
Deutsche Post DHL Annual Report 
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