The future of the South African Post Office at risk as parcel monopoly faces termination
The South African Post Office’s (SAPO) business rescue practitioners (BRPs) have warned that losing the Post Office’s exclusivity over parcels under 1 kg could slash future revenues
Image: Bhekikhaya Mabaso / Independent Newspapers
The South African Post Office’s (SAPO) business rescue practitioners (BRPs) have warned that losing the Post Office’s exclusivity over parcels under 1 kg could slash future revenues and threaten the financial recovery of the state-owned entity.
This comes as the embattled state-owned entity continues to struggle financially, with operational pressures putting its survival and service delivery at risk.
Last year, Communications Minister Solly Malatsi issued a gazetted directive removing SAPO’s exclusive mandate over parcels under 1 kg, a move that could further undermine the Post Office’s revenue streams and turnaround plans.
In their latest report, the BRPs said this could delay SAPO’s return to profitability and make it harder to serve rural and underserved communities.
"On 12 December 2025, Minister Solly Malatsi issued a directive, which was gazetted, amending the Postal Services Act to remove the reserved postal services category for parcels under 1 kg. This would effectively eliminate SAPO’s exclusivity on small parcels and is expected to negatively affect SAPO’s future postal and courier operations," BRPs said.
"The loss of this exclusivity negatively impacts on the projected revenues which were estimated to be generated in the future. This effectively means that the Post Office’s break-even profit/loss position will take much longer to achieve in future, and assuming that these revenues can be replaced by other types of revenue"
The BRPs added that they will engage with the communications regulator, ICASA, to clarify the Minister’s directive and determine the next steps for SAPO’s exclusivity on parcels under 1 kg.
"The BRPs intend to engage the regulator, ICASA, regarding the Minister’s position on what the Post Office’s exclusivity on sub-1kg parcels position is. This exclusivity is still currently in place, as ICASA must ratify directives via their regulatory approval processes. The determination of next steps rests with the Regulator and not with SAPO".
The BRPs also said "the undertaking from the government to provide a second funding tranche of R3.8 billion to fully implement the Business Rescue Plan has not materialised".
"The ongoing uncertainty and absence of the funding has necessitated ongoing engagement between the BRPs and the DCDT to consider the way forward for the SOE".
"In December 2025, the BRPs received correspondence from the Minister confirming that the second tranche of funding will not be made available. Considering this, the BRPs consider it necessary to reassess the Business Rescue Termination Application and to further evaluate the future viability of SAPO. SAPO does not have any other sources of funding other than from its current shareholder".
mthobisi.nozulela@iol.co.za
IOL Business