EU TO LAUNCH PROBE OF DEUTSCHE POST FUNDING

   Deutsche Post Group officials expect the European Union to announce this
week that it is opening an investigation into the German government’s role
in funding Deutsche Post’s parcel business.
   The new investigation stems from complaints made by United Parcel
Service and other parcel carriers operating in Europe. The carriers say
Deutsche Post has used revenue from its monopoly letter delivery business
in Germany to finance its $3 billion global acquisition spree.
   A Deutsche Post spokesman said European regulators plan to send an
official notice to the German government announcing the investigation,
which will focus on the government’s dealings with Deutsche Post. The EU
has already ruled that sufficient evidence does not exist to launch an
investigation against the postal company itself.
   UPS has petitioned the EU to investigate cross-subsidization at the
German post office since 1994. In May, UPS asked U.S. justice officials to
force the EU to take action under an international anticompetition
agreement signed by the U.S. and the European Communities in 1998.
   Deutsche Post denied there has been any cross-subsidization by the
German government since the postal company was partially privatized four
years ago.