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TOKYO -- Convenience store operator Circle K Sunkus Co. will handle Japan Post parcels at all outlets of its chains beginning in mid-November, the company and the postal service said Friday.

Japan Post's Yu-Pack delivery service will be available at a total of about 6,300 Circle K and Sunkus outlets as part of the state-run postal service provider's efforts to enhance its delivery operations.

As Japan Post has joined hands with some other convenience store operators, such as Lawson Inc., Ministop Co. and am/pm Japan Co., the new contract will bring the number of total convenience store outlets handling the parcels to about 19,300.

The figure tops the 17,200 outlets that handle parcels for Yamato Transport Co., a main rival of Japan Post.

Yamato, complaining it is impossible to have fair competition with the public entity, is expected to nullify its contract with Circle K Sunkus.

According to Kyodo News International, Yamato has said a large-scale operation by Japan Post will put pressure on private firms' operations, and that there is unfair competition because the state-backed entity receives preferential tax treatment from the government.

Circle K Sunkus President Kiyoshi Hijikata said the company had failed in its last-ditch efforts to keep the contract with Yamato.

"It is regrettable," he told reporters.

Meanwhile, Japan Post President Masaharu Ikuta said, "We want to improve the quality of Yu-Pack delivery service and get postal services as whole back into shape." The move comes as post offices nationwide are handling fewer pieces of mail and other items with the increasing use of e-mail.

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