[Federal Register Volume 74, Number 227 (Friday, November 27, 2009)]
[Notices]
[Pages 62357-62358]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-28377]
=======================================================================
-----------------------------------------------------------------------
POSTAL REGULATORY COMMISSION
[Docket Nos. MC2010-11 and CP2010-11; Order No. 345]
New Postal Product
AGENCY: Postal Regulatory Commission.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: The Commission is noticing a recently-filed Postal Service
request to add Inbound Air Parcel Post at Universal Postal Union (UPU)
Rates to the Competitive Product List. The Postal Service has also
filed a related contract. This notice addresses procedural steps
associated with these filings.
DATES: Comments are due: December 7, 2009.
ADDRESSES: Submit comments electronically via the Commission's Filing
Online system at http://www.prc.gov. Commenters who cannot submit their
views electronically should contact the person identified in FOR
FURTHER INFORMATION CONTACT by telephone for advice on alternatives to
electronic filing.
FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel,
202-789-6820 or [email protected].
SUPPLEMENTARY INFORMATION:
I. Introduction
II. Notice of Filing
III. Ordering Paragraphs
I. Introduction
On November 17, 2009, the Postal Service filed a request pursuant
to 39 U.S.C. 3642 and 39 CFR 3020.30 et seq. to add Inbound Air Parcel
Post at Universal Postal Union (UPU) Rates to the Competitive Product
List.\1\ The Postal Service asserts that Inbound Air Parcel Post is a
competitive product within the meaning of 39 U.S.C. 3632(b)(3).
---------------------------------------------------------------------------
\1\ Request of the United States Postal Service to Add Inbound
Air Parcel Post at Universal Postal Union (UPU) Rates to the
Competitive Products List, Notice of Establishment of Prices and
Classifications Not of General Applicability for Inbound Air Parcel
Post at UPU Rates Established in Governors' Decision No, 09-15, and
Application for Non-Public Treatment of Materials Filed Under Seal,
November 17, 2009 (Request).
---------------------------------------------------------------------------
The Postal Service states that prices and classifications
underlying these rates are supported by Governors' Decision No. 09-
15.\2\ Id. at 1-2. This
[[Page 62358]]
Request has been assigned Docket No. MC2010-11.
---------------------------------------------------------------------------
\2\ The Request and Governors' Decision both note that the
classification for Inbound Air Parcel Post was originally proposed
by the Postal Service for the Mail Classification Schedule language
in response to PRC Docket No. RM2007-1, Order No. 43, Order
Establishing Ratemaking Regulations for Market Dominant and
Competitive Products, October 29, 2007 (Order No. 43). Id. at 1.
---------------------------------------------------------------------------
The Postal Service states that Governors' Decision No. 09-15
establishes the prices for Inbound Air Parcel Post at UPU Rates and the
changes in classification necessary to implement those prices. Id. at
3. The rates authorized by Governors' Decision No. 09-15 are inward
land rates when there is no contractual relationship with the tendering
postal operator at the highest possible inward land rate eligible for
the United States under the Parcel Post regulations. Id. These rates
are assigned Docket No. CP2010-11.
Request. In support of its Request, the Postal Service filed the
following materials: (1) An application for non-public treatment of
pricing and supporting documents filed under seal;\3\ (2) a Statement
of Supporting Justification as required by 39 CFR 3020.32;\4\ (3) a
redacted version of Governors' Decision No. 09-15 establishing prices
and classifications for Inbound Air Parcel Post at UPU Rates,
certification of the Governors' vote, a certification of compliance
with 39 U.S.C. 3633 (a), proposed Mail Classification Schedule (MCS)
language, and a Management Analysis of Inbound Air Parcel Post at UPU
Rates.\5\
---------------------------------------------------------------------------
\3\ Attachment 1 to the Request.
\4\ Attachment 2 to the Request.
\5\ Attachment 3 to the Request.
---------------------------------------------------------------------------
Air parcels comprise inbound parcels eligible to receive
transportation by air rather than surface. Governors' Decision No. 09-
15 at 2. The Postal Service indicates that the United States receives
both air and surface parcels from foreign postal administrations which
compensate the Postal Service for delivery of these parcels in the
United States. Request at 2. It maintains that it has negotiated
separate agreements for parcel rates with certain foreign posts, but
most compensate it at the United States default rates for inbound
parcel delivery. Id. The default rates are known as inward land rates.
The Postal Service notes that inward land rates are set according to
formulas in the UPU Parcel Post Regulations which constitute
international law. Id. More specifically, the UPU Postal Operations
Council sets rates.\6\ The Postal Service states that UPU Parcel Post
Regulations require that rates are based on a percentage of each
member's inward land rate in 2004. Id. at 3. UPU members may qualify
for percentage ``bonuses'' to their base rate based upon their
provision of certain value-added services.\7\ Id. The Postal Service
states it is responsible for gathering information that the UPU Postal
Operations Council uses to calculate the rates including completion of
a questionnaire on service bonus eligibility, and submission of annual
inflation information from the Consumer Price Index for All Urban
Consumers. Id. It explains that the UPU uses this information from the
member posts and publishes an annual notice in the fall establishing
the postal administration's parcel rates for the following year. Id.
---------------------------------------------------------------------------
\6\ The UPU Postal Operations Council is a designated body of
the UPU which is responsible for rate setting.
\7\ The Postal Service states that services such as ``track and
trace, home delivery, published delivery standards, and use of a
common inquiry system'' qualify UPU members for bonuses. Id. Members
may also seek an inflation-related adjustment to the base rate which
is capped at 5 percent per year.
---------------------------------------------------------------------------
The Postal Service states that because of the unique situation of
setting inward land rates, it chose to establish rates for inbound air
parcels by reference to the Universal Postal Convention. Id.
In the Statement of Supporting Justification, Brian Hutchins,
Manager, International Postal Relations, asserts that adding Inbound
Air Parcel Post at UPU Rates to the competitive product list improves
the Postal Service's competitive posture, will cover its attributable
costs, make a positive contribution to institutional costs, and
increase contribution toward the requisite 5.5 percent of the Postal
Service's total institutional costs. Id., Attachment 2. Thus, Mr.
Hutchins contends there will be no issue of subsidization of
competitive products by market dominant products as a result of this
product addition. Id.
W. Ashley Lyons, Manager, Regulatory Reporting and Cost Analysis,
Finance Department, certifies that the contract complies with 39 U.S.C.
3633(a). Request, Attachment 3. He asserts that the prices for Inbound
Air Parcel Post at UPU Rates ``should cover its attributable costs and
preclude the subsidization of competitive products by market dominant
products.'' Id.
The Postal Service filed much of the supporting materials under
seal. In its Request, the Postal Service maintains that certain
portions of Governors' Decision 09-15 and related financial information
should remain confidential including portions of the management
financial analysis of Inbound Air Parcel Post at UPU Rates and the
accompanying analyses that provide prices, terms, conditions, cost
data, and financial projections should remain under seal. Request at 2.
Prices and classification changes established in Governors' Decision
No. 09-15 are scheduled to take effect January 1, 2010. Governors'
Decision No. 09-15 at 2.
II. Notice of Filings
The Commission establishes Docket Nos. MC2010-11 and CP2010-11 for
consideration of the Request pertaining to the proposed Inbound Air
Parcel Post at UPU Rates product and the related rates and
classifications, respectively. In keeping with practice, these dockets
are addressed on a consolidated basis for purposes of this order;
however, future filings should be made in the specific docket in which
issues being addressed pertain.
Interested persons may submit comments on whether the Postal
Service's filings in the captioned dockets are consistent with the
policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR part 3015, and 39 CFR
3020 subpart B. Comments are due no later than December 7, 2009. The
public portions of these filings can be accessed via the Commission's
Web site http://www.prc.gov.
The Commission appoints Paul L. Harrington to serve as Public
Representative in these dockets.
III. Ordering Paragraphs
It is ordered:
1. The Commission establishes Docket Nos. MC2010-11 and CP2010-11
for consideration of the matters raised in each docket.
2. Pursuant to 39 U.S.C. 505, Paul L. Harrington is appointed to
serve as officer of the Commission (Public Representative) to represent
the interests of the general public in these proceedings.
3. Comments by interested persons in these proceedings are due no
later than December 7, 2009.
4. The Secretary shall arrange for publication of this order in the
Federal Register.
By the Commission.
Judith M. Grady,
Acting Secretary.
[FR Doc. E9-28377 Filed 11-25-09; 8:45 am]
BILLING CODE 7710-FW-S