Parcel delivery markets in Europe appear broadly competitive, according to a new Copenhagen Economics study, as the EU reviews whether e-commerce parcel delivery should face new sector-specific rules.
The European Union’s parcel delivery market shows no evidence of structural competition problems, according to a new study by Copenhagen Economics prepared for PostEurop. The report comes as the European Commission reviews the EU regulatory framework for postal and delivery services and considers whether a future EU Delivery Act should extend regulation to e-commerce parcel delivery.
The study examines whether parcel delivery services linked to online shopping operate under effective competition. It focuses on three main areas: market structure, firm conduct, and market performance. According to the report, the evidence points to a sector with multiple operators, active entry, moderate margins, and a wide range of delivery options for consumers.
The issue has become more important as e-commerce continues to reshape the postal and logistics landscape in Europe. Letter volumes have been declining, while parcel volumes linked to online retail have grown. This has created a policy question for regulators: should e-commerce parcel delivery be treated as part of traditional postal regulation, or should it remain mainly governed by competition law and general market rules?
Parcel delivery markets in Europe
Copenhagen Economics argues that the current evidence does not support broad ex ante regulation of e-commerce parcel delivery. The report says that any new regulation should be based on a clear theory of harm and evidence of market failure. Without such evidence, it warns that regulation could create the risk of regulatory failure by weakening investment, innovation, and competitive pressure.
One of the report’s central findings is that e-merchants have significant bargaining power in the parcel delivery market. Online retailers and platforms are the direct buyers of delivery services. They select operators, negotiate contracts, and decide which delivery options are offered to consumers at checkout. Large e-commerce companies, in particular, can use their parcel volumes to negotiate better prices and service conditions.
The report also highlights that the European parcel delivery market includes a wide range of operators and business models. These include national postal operators, pan-European carriers such as DHL, DPD, UPS, GLS, and FedEx, regional providers, out-of-home delivery specialists, consolidators, and vertically integrated platforms such as Amazon, Allegro, and Vinted. This variety suggests that competition is not based only on price, but also on speed, convenience, network coverage, tracking, and returns.
Market concentration in parcel delivery is also lower than in traditional letter mail. The report states that the leading operator in parcel markets typically holds a share of around 37 to 50 percent, while the main operator in letter markets often holds between 82 and 94 percent. This difference is important because it shows that parcel delivery has a more distributed competitive structure than legacy postal services.
The study also finds that entry barriers in parcel delivery are relatively low. New operators can enter by focusing on specific parts of the value chain, such as last-mile delivery, parcel lockers, regional networks, or cross-border consolidation. The report notes that the number of domestic and cross-border parcel delivery operators has increased over the past decade, suggesting that new companies have been able to enter and expand.
Profitability levels also appear moderate. According to Copenhagen Economics, parcel operators’ EBIT margins typically ranged between 2.5 and 9 percent, averaging 5.5 percent in 2025. The report argues that these margins are not consistent with systematic excessive pricing. It also says that higher prices for cross-border delivery largely reflect higher costs, including longer distances, coordination between operators, customs procedures, and lower volumes.
For consumers, the report finds that parcel delivery services are generally accessible and affordable. Online shoppers across Europe can often choose between home delivery, parcel lockers, and pick-up or drop-off points. The report also says service quality is broadly similar across urban and rural areas, with reliable, timely delivery and high consumer satisfaction.
However, the report does not suggest that the market is free from all concerns. It acknowledges that competition issues can arise in specific cases, particularly where firms hold strong positions or where platform power affects logistics markets. But it argues that these concerns are better addressed through existing competition law rather than a broad new regulatory framework for parcel delivery.
The policy conclusion is clear: Copenhagen Economics says a new EU Delivery Act should avoid imposing sector-specific regulation on e-commerce parcel delivery unless clear market failures are demonstrated. It also argues that extending the postal universal service obligation to e-commerce parcels could create an uneven playing field between universal service providers and other parcel operators.
For Europe’s e-commerce sector, the debate matters because delivery is now a core part of the online shopping experience. Fast, affordable, and reliable parcel delivery affects conversion rates, customer satisfaction, marketplace competition, and cross-border trade. As the EU considers its next regulatory steps, the report suggests that policymakers should be cautious about applying traditional postal rules to a fast-changing parcel delivery market.