Royal Mail regulation faces 'fundamental review'

The regulation of Royal Mail is to be reviewed by Ofcom following the collapse of Whistl - the company formerly known as TNT.

Ofcom has launched a 'fundamental review' of the regulation of Royal Mail Credit: PA

Ofcom said it has launched a "fundamental review" of the regulation and its review would ensure that regulation "remains appropriate and sufficient to secure the universal postal service".

The collapse of Whistl has left Royal Mail no national competition in the direct-delivery letters market.

It will look into the absence of national competition and whether Royal Mail's prices are "both affordable, and sufficient to cover the costs of the universal service."

Royal Mail shares dropped 2% following the announcement.