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China settles with express deliverers

The world's four major express delivery companies say they have settled a dispute over the Chinese post office's attempt to limit their operations in China.

US officials had complained to Beijing about the restrictions, which threatened to violate China's WTO commitments to open its markets to foreign competitors.

FedEx Corp, United Parcel Service Inc, DHL Worldwide Express Inc and TPG NV agreed to accept a new licensing system imposed by the State Postal Bureau after the government promised that it wouldn't affect their businesses, a trade group representing the companies said Thursday.

"We don't anticipate that our business will be changed in the future," said Eddy Chan, a spokesman for the Council of Asia Pacific Express Companies.

The State Postal Bureau has been trying for two years to limit operations of foreign couriers, which have been taking business away from its commercial arm, China Post.

The bureau had used its regulatory power to try to limit their business. In February, it said foreign companies couldn't carry packages in China weighing more than 500g.

The Chinese Cabinet intervened in the dispute in July, apparently worried about the political damage of violating WTO commitments.

The express delivery companies agreed to the Postal Bureau's demand to apply to it for business licenses. Chan said the government promised that process would be purely "procedural."

The compromise includes a ban on the companies handling documents for the government, military or Communist Party.

"If they decide not to give us their business, that is their right," Chan said.

Chan said the companies still object to the State Postal Bureau regulating them while its commercial arm is their competitor.

"It's not right," he said. "We will work with appropriate agencies to change this in the future."
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