The Belgian Government is accused of sending hundreds of millions of Euros in illegal subsidies to the Belgian Post Group (Bpost) by investigative journalists from local news outlet Business AM.
The government “intentionally misled” the European Commission to get the transfers approved, they claim.
The allegations in a book by two Business AM journalists, called Bpost Hold-Up, are causing outrage.
The authors claim to have a “tell-all informative note”, which they attribute to the former chief executive of Bpost, Dirk Tirez. It reveals how the company allegedly overstated costs for delivering newspapers in order to receive elevated subsidies. In doing so, other companies delivering mail and parcels, such Post NL and DHL, suffered serious competitive disadvantages.
The explosive publication concludes that “based on the factual elements, the EC should open a formal investigation against the Kingdom of Belgium to examine the various subsidies over the past 10 years to Bpost and to examine the renewal of press contracts for 2023 and beyond.”
Brussels Signal contacted the authors of the book, Wouter Verschelden and Emmanuel Vanbrussel. As Dirk Tirez does not talk to the media, the duo said they had therefore concluded he was the author of the note. They said Bpost is threatening to sue them because it objects to the title Bpost Hold-Up.
A spokesperson for the EC told Brussels Signal said compensation granted by Belgium between 2016 and 2020 was in line with European Union rules, as was an extended regime in 2022. “It is for Member States to ensure the accuracy and completeness of information provided to the Commission in the context of the assessment of state aid matters,” the spokeswoman said.
In Belgium, the Auditor General confirmed to Brussels Signal that the Belgian Competition Authority is looking into subsidies for the distribution of newspapers. It added that all other accusations of possible misuse of funds at Bpost fall under the sole discretion of the EC. The fact that the EC does not seem to have picked up on this, observers say, raises a lot of questions.
This website asked Belgian parliamentarian Michael Freilich of the centre-right N-VA party, who has followed other alleged Bpost scandals, for comment. He said the EC’s silence was not unusual as it only looks into the legality of competition and state aid as they are implemented. It can’t do much when third parties involved are alleged to have been implicated in fraud, as that is for Belgian authorities, in particular the public prosecutor’s office, to investigate.
He said he fears “a typical Belgian scenario”, where several separate bodies undertake inquiries while waiting on each other to make a move, meaning such a probe could drag on for years and might eventually simply end without consequence.
Freilich and his party, together with opposition party Vlaams Belang, have demanded a parliamentary investigative commission to shed light on any malpractice, the latter party alleging “outright mafia” behaviour. Bpost opposes an investigative commission.
Another possibility, Freilich points out, is that parcel companies, digital media, and newspaper shops may press charges.
Public contracts for newspaper delivery subsidies are allowed by the EC but only if they adhere to certain conditions. Profit margins need to be limited to a maximum of 7.4 per cent of costs. In some Bpost cases, they allegedly exceeded 70 per cent.
“Such deception was done deliberately and systematically, including through inflating costs,” the authors state. “For this one specific file alone, the state gave €334 million euros in illegal state aid. And that’s not counting interest.”
They base their accusations on a 25-page long memorandum attributed to Tirez, who was Bpost chief executive between 2021 and the end of 2022. He was put in place by a politically appointed board and forced to step aside amid allegations of illegal tenders for the distribution of newspapers and magazines.
In total, Bpost is said to have received €4 billion in taxpayer money between 2013 and 2023. According to the journalists, most of these subsidies and fees are questionable and are the result of close ties between the Belgian state and the company.
Bpost’s lucrative contract was recently renewed in a contested decision, preceded by intense lobbying. Bpost use monopoly power to allegedly make questionable price-fixing agreements with publishers DPG media and Mediahuis, as was revealed by an internal audit.
In April 2023 Bpost was forced to admit it had broken European competition rules and had overcharged by tens of millions of Euros amid reports of secret deals between the company and the Belgian state.
The journalists further accuse Bpost of making a deal with a representative of the Belgian federation of newspaper sellers, who mysteriously dropped a European court case.
Opposition parties have decried Bpost’s apparent lack of transparency and want the current president and the interim-ceo Philippe Dartienne to resign.
The postal company says it is cooperating with the ongoing investigations. “If and when it would appear that, in the context of the three ongoing investigations, there is overcompensation by the Belgian state to Bpost, Bpost will proceed with reimbursement,” it said.
As well as threatening to sue the book’s authors, Bpost considers other elements in the publication to be “misleading and unsubstantiated”. The company claims not to be aware of the note the journalists refer to.
Vandaag nieuw boek, samen met onderzoeksjournalist @evanbrussel over één v dgrootste schandalen met overheidsgeld in decennia: 'Bpost Hold-up'.
We volgen dit dossier van krantencontract al tien jaar, maar tijdens ons onderzoek toch paar keer van onze stoel gevallen.
draadje 👇 pic.twitter.com/MvpNW6WGGp
— Wouter Verschelden (@woverschelden) July 18, 2023
