CTT confident of new concession contract as of January 1

CTT’s CEO was confident that a new universal postal service concession contract will be signed with the Portuguese government before the end of the year, to come into force on January 1, 2022.

“We have been involved in the preparatory work. We share ideas, recommendations, data and talk about our objections to the predatory framework,” said João Bento, in a presentation of results to analysts.

The CEO did not answer whether he has already had access to the conclusions of the working group formed by the government in February, which made an assessment for the new concession. But he said the “progress” he has seen and the “feedback” the company has received, has given him enough confidence to include it in the financial results for the first half of the year.

The H1 2021 results statement read: “Given the recent progress on the unfolding of the process leading to the new concession contract, we reaffirm confidence that it will be formalized within the term of the current extension.”

“This should improve CTT’s ability to fulfil the universal service obligations under a more sustainable framework,” the document added.

CTT, a former public company, is seen as the only postal company in Portugal that has a network with the capillarity and characteristics necessary to provide a universal postal service. But it has demanded from the government an easing of the quality indicators.

For several years the company has been failing these indicators, complaining that they are “impossible to meet”. This year, Anacom has further tightened what it considers should be the quality criteria for the new concession. In response, CTT said it views the timing of Anacom’s decision with “great strangeness”.