Ofcom has fined Royal Mail a record £50m for breaching competition law.
The fine is for its actions in 2014 when Whistl was trying to become its first competitor in wholesale mail delivery.
The regulator’s investigation, which followed a complaint by Whistl, said Royal Mail abused its dominant market position by discriminating against the company by making changes, including price rises, to some contracts.
Royal Mail will challenge the fine.
Ofcom found that Royal Mail’s price rises in 2014 meant any of its wholesale customers seeking to compete with it, as Whistl did, would have to pay higher prices in the remaining areas where it used Royal Mail for delivery.
As a result, Whistl suspended plans to extend delivery services to new parts of the country.
Ofcom’s investigation found that Royal Mail’s actions amounted to “anti-competitive discrimination against customers, such as Whistl, who sought to deliver bulk mail”.