THE EU Commissioner for Industry, Mr Martin Bangemann, last night warned that the Commission would be forced to use its powers under Article 90 to force the pace of postal liberalisation following deadlock between ministers on the issue.

The Minister for Telecommunications, Mr Lowry, who chaired the meeting of telecommunication ministers, expressed disappointment at the failure to reach agreement on the Postal Directive. He said the failure was a result of fundamental differences of interest and the intrusion of domestic politics into the agenda.

The Postal Directive provides for the phased liberalisation of services in the £50 billion EU market, while retaining the possibility of a monopoly on domestic deliveries on certain weight and price categories of post. The exemption is to provide sufficient profit base for service to rural areas.

Yesterday's Franco-German compromise proposal also provided for the liberalisation of cross-border post and direct mail by 2003 and a review process in 2001.

In the Commission camp, opposed to slowing the pace of liberalisation, were the Nordic countries, the Dutch and Austria, a bloc sufficient to prevent a Franco/German compromise from reaching a qualified majority.