State Council to mediate in post war

PUBLISHED : Tuesday, 18 June, 2002, 12:00am
UPDATED : Tuesday, 18 June, 2002, 12:00am

The responsibility for settling a fractious China Post dispute is now firmly in the hands of the State Council as yet another deadline imposed by the State Post Bureau came and went at the weekend.

The bureau, governed by the Ministry of Information Industry (MII), has since February been trying to carve out China's international small package market for itself, evoking strong protest from a rival ministry and international express operators.

The State Council last month gave officials from the MII and the Ministry of Foreign Trade and Economic Co-operation (Moftec) two weeks to settle their jurisdictional dispute to no avail, so it appointed itself the sole adjudicator at the weekend.

Express sources said the bureau's June 15 deadline for forwarders and express operators to stop carrying parcels in excess of 500 grams or risk being branded an 'illegal enterprise' had been extended by another 60 days. It would be the third extension of a 'deadline' in the dispute.

But sources close to the talks in Beijing said deadlines were now meaningless.

'The State Council is now the mediator in the dispute and it will end when it gives its final decision,' the source said.

The bureau has been trying to impose a 'certification' process on express operators and freight forwarders, restricting them from carrying packages of less than 500 grams or would have forced them to charge more than China Post for doing so.

As most domestic forwarders moving international freight in China are partners with, or affiliates and subsidiaries of Sinotrans, an arm of Moftec, the foreign trade ministry has questioned the MII's authority to impose the restriction.

International express operators such as Federal Express, United Parcel Service and DHL Express Worldwide said the restriction flew in the face of basic tenets governing accession to the World Trade Organisation.

China Post has seen its international express monopoly severely eroded in the past decade by efficient, well-backed foreign operators.


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