a a a Display Options Cymraeg
Follow Ofcom on Facebook Follow Ofcom on Twitter Subscribe to the Ofcom RSS Follow Ofcom on YouTube Follow Ofcom on YouTube

Independent regulator and competition authority
for the UK communications industries.

Search Ofcom


Postcode Address File

Summary

Introduction

The Postcode Address File

1.1 The Postcode Address File, abbreviated as 'PAF', is a database containing every address that can receive mail (i.e. every 'delivery point') in the UK. It contains around 28 million addresses for over 1.8 million postcodes. PAF contains a number of information fields relating to each postcode to help accurate delivery of mail such as property numbers and street names. It includes around 1.4 million business names and details of around 200,000 vacant properties. It does not contain the names of individuals living at a particular address, addresses for places such as parks, etc. It also does not contain details of every individual property - for example, where a building contains a number of flats that share a single letter box, this will be listed as a single delivery point in PAF.

1.2 Royal Mail currently owns PAF and maintains it so that it reflects the postcode addresses which are 'live' for receiving mail. It makes the file available to other users.

The uses of PAF

1.3 PAF was developed for and is integral to providing postal services. It is used by Royal Mail to sort, sequence and deliver mail. Other postal operators (and organisations processing or sending mail in bulk) depend on it to sort their mail when using Royal Mail access or bulk mail products.

1.4 Over time PAF has developed to support the delivery of a wide range of non-postal services across the UK public and private sectors. There are around 37,000 end-users of PAF, the vast majority of which are outside of the postal sector.

1.5 Products based on PAF data are used in many sectors including publishing, media, utilities, retail and financial services. PAF data is central to business applications such as:

  • database management and data cleansing;
  • address capture (for example, the auto-completion of address information based on a postcode and property number when entering an address into a website);
  • identification;
  • insurance premium calculations;
  • mapping; and
  • marketing and market research.

1.6 Millions of citizens interact directly with solutions incorporating PAF data when shopping online, largely through the 'address look up' used in completing a billing or delivery address, or when accessing location information.

Access to PAF

1.7 Royal Mail currently owns the intellectual property to PAF. Under section 116 of the Postal Services Act 2000, Royal Mail is required to maintain PAF and to make it available to any person wishing to use it on reasonable terms (which can include the payment of a fee).

1.8 Royal Mail makes PAF available through a licensing regime whereby end-users pay licence fees in order to use PAF data, either directly to Royal Mail or indirectly via resellers of products which incorporate PAF data.

The current regulatory framework

1.9 The previous postal regulator, Postcomm , completed a review of PAF in 2007, followed by a further review in 2010/11.

1.10 Their 2007 review set a 'co-operative' regulatory approach to PAF (which was essentially retained following the later review) including:

  • creating the independently chaired PAF Advisory Board ('PAB') to represent users and influence Royal Mail's behaviour on operational issues;
  • ring-fencing PAF into a distinct Address Management Unit ('AMU') within Royal Mail; and
  • setting a voluntary target profit cap on PAF of 8-10% above operating costs.

1.11 Postcomm's 2010/11 review concluded that any over achievement of the profit target should be considered cumulatively over 3 years and linked to a three year cycle of agreed investment and/or agreed return of excess profits to customers.

The driver and scope for our review

1.12 We are reviewing PAF following a direct request from the UK Government. In November 2011, Ed Davey MP, then Government Minister for Postal Affairs, wrote to us requesting that we conduct a review of PAF's pricing and licensing framework and suggesting that our review should seek to:

  • ensure the licensing framework incentivises wider take up and use of PAF data;
  • ensure the data is made easily accessible to customers and users on reasonable terms;
  • ensure that the licensing terms are as simple and light touch as possible;
  • drive efficiency in the maintenance and distribution of PAF; and
  • ensure the integrity of the data is maintained.

1.13 We committed to reviewing PAF after we completed our work on the new regulatory framework for postal regulation. This concluded in March 2012 with a regulatory statement (the 'March 2012 statement'). Our review has a broad scope in line with Government's priorities and in cognisance of our legal powers and duties in relation to PAF.

1.14 In June 2012, we received a letter from Norman Lamb MP, the then new Postal Affairs Minister, requesting that Royal Mail's cost base for PAF should be explicitly brought within the scope of our review.

1.15 As a result of our review, we are making proposals on two key aspects within the scope our review:

  • we set out our preferred approach to the costs of PAF and the terms on which it is made available; and
  • we believe licensing framework should be simplified and propose a number of licensing 'principles' that Royal Mail should consider in creating the new licensing framework in 2013.

Our proposals

1.16 Our proposals for the future regulation of PAF are set out in Sections 6 and 7 of this document. Sections 3, 4 and 5 provide the information on which we have based these proposals.

1.17 Our proposals focus on three areas:

  • the allocation of the costs of PAF, and their recovery;
  • the pricing and licensing framework; and
  • our approach to the terms on which PAF is made available.

1.18 In terms of cost allocation and recovery, we propose that Royal Mail should continue to be able to recover all the costs of PAF from licensees.

1.19 On the pricing and licensing framework, we encourage Royal Mail to simplify the licensing regime as part of their current review of the pricing and licensing framework, supported by PAB.

1.20 With regard to the terms on which PAF is made available, we provide high level guidance as to the factors we may consider when assessing whether such terms - both price and non-price terms - are reasonable.

In this section

Postcode Address File  PDF Document  (278 kB)

Full print version

Back to top