EU court rejects UPS claim against Brussels over TNT

The General Court of the European Union in Luxembourg has dismissed a record EUR1.7 billion euro (USD1.9 billion) compensation claim by US express mail giant United Parcel Service (UPS) against the European Commission for having blocked its 2013 bid for Durch rival TNT Express, which included TNT Airways (3V, Liège) – now rebranded as ASL Airlines Belgium (3V, Liège).

The court has also dismissed compensation claims of EUR93.8 million (USD106.2 million) against the EC from air freight companies ASL Aviation Holdings and ASL Airlines Ireland (ABR, Dublin Int’l) for the loss of profits resulting from the blocked merger between UPS and TNT. They had already agreed to purchase 100% of TNT Airways after the planned merger with UPS and to take over its air transport business. The rationale was the prohibition on entities from third countries, such as UPS, from operating air transport services in the EU.

The cases followed the January 30, 2013, decision by the European Commission declaring the then planned EUR5.2 billion (USD5.8 billion) merger between UPS – the parent of UPS Airlines (5X, Louisville Int’l) – and TNT a “significant impediment” to effective competition in the EU market.

In April 2013, the General Court then dismissed an application by UPS to have the EC decision annulled.

However, in January 2016, Brussels approved the EUR4.4 billion (USD4.9 billion) purchase of TNT by FedEx Corp.

In March 2017, UPS was successful in another application to have the EC decision against its merger with TNT annulled. An appeal in May 2017 by the European Commission was dismissed in January 2019.

The current action by UPS was brought against Brussels on December 29, 2017. Amongst other assertions, UPS’s case was built on claims that its procedural rights had been infringed, that the Commission had failed to state adequate reasons for its decision, and around questions relating to the validity of assessments that had led to its decision.

In its ruling on February 23, 2022, the General Court rejected all of UPS’s claims and dismissed the action in its entirety.

It ordered the Commission to bear its own legal costs and to pay one-third of the costs incurred by UPS.