Carat's contract comes to an end in March 2006 and the review is expected to begin this autumn, three years after the previous review.
The media account includes a £30m brief for Royal Mail's international, consumer and stamps businesses, as well as a £10m brief for Parcelforce Worldwide. Carat also runs Royal Mail's data planning and controls its countrywide database.
Neil Jones, the managing director of Carat, said: "Our data planning is something that no other agency can offer and our company has grown significantly because of this account. We understand the statutory process, having gone through it before, but we have a strong relationship with Royal Mail and we are in a great position to hold on to the business when the review comes up."
By law, Royal Mail has to put its account out to pitch every three to five years and it is believed that the upcoming review is being instigated by the incoming marketing director and ex-Orange global brand chief, Alex Batchelor.
Appointed in April and taking up the position in June, Batchelor has been charged with reversing the poor public image of Royal Mail and raising the company's profile.
Carat originally won the account in 1997 when it beat OMD UK and the then incumbent Mediavest in a three-way pitch. In 2002, the agency held on to the business after a statutory pitch against Zenith and MindShare.
Abbott Mead Vickers BBDO holds the £20m above-the-line account, which it won in May 2003 after a pitch against M&C Saatchi, Grey Worldwide and JWT. AMV's sister Omnicom agency Proximity handles direct marketing for Royal Mail.
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