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Postal Services Act, 1998 (Act No. 124 of 1998)

Price Cap Regulations for Reserved Postal Services

3. General Price Control Formula

 

1) The Licensed Operator shall ensure that in each price control year the price charged for the reserved services shall be set so as to satisfy the criteria in the formulae below:

 

Formula

 

Where-

 

t: is the current year in the price control period;

t-1: is the preceding year;

Xt: is the productivity factor in the price control period "t" and the Authority determines that for the period 01 April 2011 to 31 March 2014 the productivity factor will be as follows:

 

Price control period

Productivity factor

01 April 2012

1.00%

01 April 2013

1.50%

01 April 2014

2.00%

 

2) RRt is the reported revenue of the Licensed Operator in year "t" of all the reserved postal services and is calculated as follows:
 

 

3) RRt-1 is the reported revenue of the Licensed Operator in year "t-1" of all the reserved postal services and is calculated as follows:

 

 

4) CP/ t-1: is the year-on-year change in the Consumer Price Index, as compiled and published by Statistics South Africa.
a) The Licensed Operator must implement a basket consisting of all reserved postal products and services.
b) The weighted-average annual rate increase for reserved postal services shall be set to satisfy the criteria in the expression below:

 

 

c) RCt is the total Revenue Change, and is calculated as follows:
 

 

Where-

 

n: is the number of reserved postal products and services