Price cap for reserved services

The registered mail service used in judicial or administrative procedures is reserved for CTT since 27.04.2012.

This service is currently subject to a price cap of CPI+CPICF-0.4%, defined for services reserved in the Price Convention, of 10 July 2009, temporarily in force, under paragraph 7 of article 57 of the Postal Law.

Given that:

- This service, as referred earlier, presents a largely positive margin;
- Its provision is reserved for CTT, thus there is no competitive pressure,

It is deemed appropriate to continue to apply a price cap to this service, aiming to:

- Protect users of this service;
- Create incentives, in the framework of the principle of cost-orientation of prices, for an efficient provision of the universal postal service.

It is considered that an annual price cap of CPI - 3.5% must be applied, in nominal terms, which is estimated to nullify, within the 3-year period, the positive margin estimated for 2014 (considering certain estimates of cost and traffic evolution, presented in Table 7, and considering inflation estimates referred earlier).

(a) It is deemed that in 2014 and 2015, traffic evolution of reserved services is similar to the development occurred in the last 12 months ending in September 2014, compared to the same period in the previous year.
(b) ICP-ANACOM assumption.
(c) For the 2016-2019 period, a traffic variation similar to that estimated in the referred study prepared by Copenhagen Institute for Future Studies for Europe for the 2010-2020 period is deemed to occur, for transactional mail, being adopted the worst-case scenario (with the highest traffic decrease): -4,0% per year.
(d) Estimate referred in CTT’s letter of 12.03.2014, concerning the price proposal to take effect as from 01.04.2014.
(e) The same assumptions adopted earlier in the estimation of CTT’s cost variation are deemed to apply in this situation (vide Table 5): variation by -0.63% per year, plus 0.25% variation per each 1% traffic variation.

Applying these costs and traffic evolution estimates to values for 2013¹, in order to obtain a zero margin by the end of the three-year period, as referred above, it is necessary to apply an average annual variation of CPI-3.5%².

Unit: Euro and number of objects.

Just like in the case of the pricing rule applicable to the basket of correspondence service, editorial service and parcel service, it is deemed that, for the same reasons, the price cap of reserved service must also be applied an inflation correction factor (CPICF) and a traffic correction factor (TCF).

As such, the following price cap must be applied to reserved services, for the 2015-2017 period:

- For 2015: (CPI + CPICF) - 3.5%;
- in each of the following years: (CPI + CPICF) - 3.5% + TCF

The difference is that CPICF applies already in the first year of validity (2015), given that, as referred earlier, reserved services are currently subject to a price cap, which includes a CPICF.