[Federal Register Volume 74, Number 7 (Monday, January 12, 2009)]
[Notices]
[Pages 1263-1264]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-290]
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POSTAL REGULATORY COMMISSION
[Docket Nos. MC2009-14 and CP2009-20; Order No. 164]
International Mail Contracts
AGENCY: Postal Regulatory Commission.
ACTION: Notice.
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SUMMARY: The Commission is noticing a recently-filed Postal Service
request to add International Business Reply Service (IBRS) to the
Competitive Product List. The Postal Service has also filed a related
contract. The notice invites public comment and addresses routine
procedural matters. In addition, it directs several questions to the
Postal Service.
DATES: Postal Service responses to questions identified in this notice
are due January 12, 2009. Comments are due January 16, 2009.
ADDRESSES: Submit comments electronically via the Commission's Filing
Online system at http://www.prc.gov.
FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel,
202-789-6820 and [email protected].
SUPPLEMENTARY INFORMATION:
I. Introduction
On December 24, 2008, the Postal Service filed a formal request
pursuant to 39 U.S.C. 3642 and 39 CFR 3020.30 et seq. to add
International Business Reply Service Contract 1 to the Competitive
Product List.\1\ The Postal Service asserts that the new International
Business Reply Service Contract 1 product is a competitive product
``not of general applicability'' within the meaning of 39 U.S.C.
3632(b)(3). Request at 1. The Request has been assigned Docket No.
MC2009-14.
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\1\ Request of the United States Postal Service to Add
International Business Reply Service Contracts to the Competitive
Products List, and Notice of Filing (Under Seal) Contract and
Enabling Governors' Decision, December 24, 2008 (Request). The
Postal Service proposes to call this new product ``International
Business Reply Service Contracts.'' In this Notice, the Commission
proposes to slightly alter that proposed name to ``International
Business Reply Service Contract 1'' to provide for the possibility
that more than one type of International Business Reply Service
contract may exist in the future that is not functionally or
substantially equivalent to the proposed Docket No. CP2009-20
contract. This may occur even though other future contracts may meet
the parameters set by the Governors' Decision No. 08-24.
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The Postal Service contemporaneously filed a contract related to
the proposed new product pursuant to 39 U.S.C. 3632(b)(3) and 39 CFR
3015.5. The contract has been assigned Docket No. CP2009-20.
Request. The Request incorporates (1) A statement of supporting
justification as required by 39 CFR 3020.32, (2) a redacted version of
the Governors' Decision authorizing the new product; (3) requested
changes to the Mail Classification Schedule; and (4) a certification of
compliance with 39 U.S.C. 3633(a).\2\ Substantively, the Request seeks
to add International Business Reply Service Contract 1 to the
Competitive Product List. Id. at 1-2.
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\2\ Attachment 1 consists of a statement of supporting
justification for this Request. Attachment 2 is the redacted
Decision of the Governors of the United States Postal Service on
Establishment of Prices and Classifications for International
Business Reply Service (IBRS) Contracts (Governors' Decision No. 08-
24). The Governors' Decision includes three attachments. Attachment
A is proposed Mail Classification Schedule language. Attachment B is
the price floor and price ceiling formulas approved by the
Governors. Attachment C provides an analysis of the proposed price
floor and price ceilings discussed in Attachment B. Attachment D is
a certification as to the formulas for prices offered under
applicable International Business Reply Service contracts.
Attachment 3 is a redacted certification for the IBRS contract at
issue in Docket No. CP2009-20. Unredacted copies of the Governors'
Decision, the IBRS contract, the certification, and other supporting
documentation establishing compliance with 39 CFR 3015.5 were filed
separately with the Commission under seal.
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In the statement of supporting justification, Jo Ann Miller,
Director, Global Business Development, asserts that the service to be
provided under the contract 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 1. Thus, Ms. Miller contends there
will be no issue of subsidization of competitive products by market
dominant products as a result of this contract. Id.
Product description. As part of her statement of supporting
justification, Ms. Miller describes the proposed product. She explains
that IBRS contracts are for U.S.-based entities seeking a channel for
returned merchandise or other articles from their overseas customers.
Such entities typically supply preprinted, prepaid IBRS packaging in
which their customers can place used or defective consumer items into
the mailstream at no direct cost. The business entity compensates the
Postal Service for this service, and the Postal Service remits to the
relevant foreign postal administration the amount due for collection
and transportation of the items in the foreign country. Id., Attachment
1, section (d).
Related contracts. An unredacted version of the specific
International Business Reply Service Contract 1 is included with the
Request filed under seal. Unlike past practice, the entirety of the
Docket No. CP2009-20 contract was filed under seal, and no redacted
version was filed publicly. The Commission requests the Postal Service
to explain why no portions of this contract can be filed publicly no
later than January 12, 2009.
The contract is for 1 year from the date the Postal Service
notifies the customer that all necessary approvals and reviews of the
agreement have been obtained. The Postal Service represents that the
contract is consistent with 39 U.S.C. 3633(a). See id., Attachment 1
and Attachment 3.
The Postal Service also explains that it has two ongoing similar
arrangements with two customers whose prior contracts officially
expired. These ``contingency arrangements'' survive the contracts'
expiration and govern any residual items that third parties might
continue to enter into the mailstream for return to the IBRS customers.
The Postal Service states when the Docket No. CP2009-20 contract
expires, this contingency arrangement will continue with respect to
this contract partner until such time as a new IBRS contract can take
effect after all necessary approvals and reviews. The Postal Service
shall provide any and all IBRS contingency arrangements currently in
effect no later than January 12, 2009. See Request at 3.
Confidentiality. The Postal Service filed much of the supporting
materials, including the Governors' Decision and the specific
International Business Reply Service Contract 1, under seal. In its
Request, the Postal Service maintains that the contract, related
financial information, the customer's name, the accompanying analyses
and certified statements that provide cost, prices, terms, conditions,
and financial projections should remain under seal. Id. at 3-4. It
notes that prices and other contract terms relating to parties'
processes and procedures are confidential in the business world and
[[Page 1264]]
should be protected in accordance with industry standards. Id.
II. Notice of Filings
The Commission establishes Docket Nos. MC2009-14 and CP2009-20 for
consideration of the Request pertaining to the proposed International
Business Reply Service Contract 1 product and the related contract,
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.
The Commission appoints Michael J. Ravnitzky to serve as Public
Representative in these dockets.
Comments. 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 and 39 CFR part 3015 and
39 CFR 3020 subpart B. Comments are due no later than January 16, 2009.
The public portions of these filings can be accessed via the
Commission's Web site (http://www.prc.gov).
Pursuant to 39 CFR 1315.6, the Commission requests that the Postal
Service address the following issues by January 12, 2009:
1. Ms. Miller's statement describing the product and why it should
be classified as competitive, at least preliminarily, seems as though
it could also apply to the domestic Merchandise Return Service product
which is currently classified as market dominant. See Request,
Attachment 1, section (d). Should this proposed product category be
called ``International Merchandise Return Service'' to better align it
with its domestic counterpart (Merchandise Return Service) and to avoid
confusion with the market dominant product of the same name
``International Business Reply Service''? See Order No. 43, Order
Establishing Ratemaking Regulations for Market Dominant and Competitive
Products, October 29, 2007 at Appendix A, sections 1540 and 1505.10.
2. For the reasons set forth in Attachment 1, section (d), should a
proceeding be initiated to consider moving the domestic Merchandise
Return Service product to the competitive rate category? If not, please
explain the processing and market characteristic differences between
the proposed new product and Merchandise Return Service.
Other interested persons also may find it appropriate to address
these issues in their comments.
III. Ordering Paragraphs
It is Ordered:
1. The Commission establishes Docket Nos. MC2009-14 and CP2009-20
for consideration of the matters raised in each docket.
2. Pursuant to 39 U.S.C. 505, Michael J. Ravnitzky 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, including
those addressing questions (1) and (2) of section II above, are due no
later than January 16, 2009.
4. The Postal Service shall address questions (1) and (2) of
section II above no later than January 12, 2009.
5. The Postal Service shall provide any and all IBRS contingency
arrangements currently in effect no later than January 12, 2009.
6. The Postal Service shall explain why no portions of this
contract can be filed publicly no later than January 12, 2009.
7. The Secretary shall arrange for publication of this Order in the
Federal Register.
By the Commission.
Steven W. Williams,
Secretary.
[FR Doc. E9-290 Filed 1-9-09; 8:45 am]
BILLING CODE 7710-FW-P