The Royal Mail has been hit with its second multi-million pound fine this month after the industry’s regulator accused it of securing "unfair commercial advantage".

Postcomm proposed a fine of £2.16 million because the company had failed to take adequate steps to make sure it did not gain an unfair commercial advantage in the newly-liberalised mail market. Royal Mail lost its 350-year monopoly of the right to deliver the letters on January 1 2006.

The fine follows a penalty of £11.7 million against Royal Mail announced last week because of millions of items of lost or damaged post.

The Royal Mail hit back angrily at the latest fine, denouncing the decision as "shoddy" and the accusations "unsubstantiated".

Royal Mail has a 97 per cent share of the postal market, and charges competitors a fee for its postmen and women to deliver their mail under a so-called "downstream" access arrangement. Postcomm started investigating these arrangements last year after three companies, Express, TNT Mail and UK Mail, complained about parts of the Royal Mail’s competitive behaviour.

The regulator said that it concluded that Royal Mail had not put in place adequate measures to prevent it obtaining an unfair advantage over its competitors.

Nigel Stapleton, chairman of Postcomm, said: "Competition is already starting to offer a better deal for customers but, given Royal Mail’s dominant position, the full benefits will never be felt unless the playing field is made as level as possible for the new operators. We cannot allow any actions by Royal Mail that unfairly keep competitors out of the market.

"Many companies working for different clients have ’Chinese walls’ - internal separation arrangements that prevent conflicts of interest and the exchange of confidential information between teams working on different projects. The Commission is surprised that Royal Mail did not think it needed to do this in a fully professional manner."

The industry’s consumer watchdog Postwatch welcomed the fine and said it expected any future penalties for anti-competitive behaviour to be substantially bigger.

Gregor McGregor, the chief executive of Postwatch, said: "Having only been opened up to full competition last month, the postal market is immature, but developing rapidly.

"Building customer and competitor confidence and ensuring a level playing field are essential if the UK postal market is to flourish. It was essential that Postcomm take action to protect the competitive market and we are pleased it has."

But Allan Leighton, the Royal Mail chairman, angrily promised to appeal against the fine, saying that no customers or competitors had been disadvantaged. He said: "This is a shoddy report from a grandstanding regulator who is looking to micro-manage the entire postal industry. It is full of unsubstantiated and subjective views, which are not based in fact.

"The simple truth is: no competitor has lost out, no customer has lost out, and Royal Mail has made no gain from the way in which we operate access services - so why any fine at all? This huge and arbitrary penalty is illogical - it is regulation for the sake of regulation.

"This is almost Monty Pythonesque - by Postcomm’s line of thinking I have absolutely no doubt that later this year the regulator will fine us for delivering the best quality of service ever due to the fact that they decide it’s anti-competitive."

Royal Mail has 28 days to make representations about the fine.

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