PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Comments to the Postal Rate Commission on Shipping Rate Parity for U.S. Small Businesses

By at 2 July, 2018, 5:47 pm

Postal Regulatory Commission

901 New York Avenue, NW Suite 200

Washington, D.C. 20268

 

RE: Docket No. IM2018-1, 407 Public Comment

 

Dear Chairman Taub,

As an advocacy organization for small business owners and entrepreneurs, the Small Business and Entrepreneurship Council (SBE Council) expresses its gratitude to the Commission for maintaining an ongoing dialogue surrounding international mailing procedures adopted by the U.S. Postal Service.

SBE Council’s network of partners, entrepreneurs, small business owners, and local business organizations remain concerned about the unbalanced consumer market in which foreign business interests are promoted to the detriment of businesses within the United States as result of USPS policies.

Furthermore, SBE Council acknowledges the Commission’s determinations (dated March 29, 2018), which included seeking remedies to concerns about the UPU pricing regime for Inbound Letter Post. As the Commission stated, “domestic mailers are subsidizing the entry of Inbound Letter Post by foreign postal operators who use the same postal infrastructure but bear none of the burden of contributing to its institutional costs.”

For the purposes of this docket we ask the Commission provide an update on Postal Service’s progress to meet the Commission’s directives. This includes corrective action to require improved accuracy of shape-based data and costing models for Inbound Letter Post, while also identifying and implementing operational strategies to lower costs – all of which are key measures that have yet to be adequately prioritized by the U.S. Postal Service.

Further, SBE Council reemphasizes that the impact of USPS’ pricing errors on the nation’s small business community cannot be understated. It is fundamentally problematic that foreign mailers continue to be charged far lower rates by the USPS to complete deliveries within the U.S. in comparison to the prices that American businesses face to send items from one domestic location to another.

While Postal Service leaders have noted the nominal rate increases that took effect in January to address this imbalance, the USPS should however, shoulder the burden of proof that complete parity – not just improvement – has been achieved. In the event that analyses reveal persisting inequity, the Postal Service must work in close coordination with the Secretary of State to ensure a non-discriminatory pricing system that will allow domestic sellers to access a level playing field in reaching American consumers.

Previously, the Postal Service has unilaterally aimed to set such rates as a part of the United States’ membership within the Universal Postal Union (UPU). This was discovered in a 2017 letter to U.S. Representative Kenny Marchant (TX-24), in which a State Department official, Charles S. Faulkner, revealed that the United States did not formally approve the Acts of the 2012 UPU convention and that the Acts of the 2016 convention have not yet been entered in force. This points to a likely violation of law by the U.S. Postal Service to apply rates without allowing the Secretary of State to fulfill its duty to affirm determinations made during official UPU engagements.

Such violations must prompt the Commission to consider applying new operational requirements on the USPS, including mandates that the agency recoup funds from foreign postal services when inbound mailings are delivered by USPS at below-cost prices.

Moving forward, the Postal Service can identify management alterations that are financial viable and equitable for American businesses, but it will take further attention and stringent guidance from the Commission to fully effectuate these objectives. Thank you for your consideration of SBE Council’s views and we welcome any further opportunities to discuss these proceedings.

Sincerely,

Karen Kerrigan

President, Small Business and Entrepreneurship Council

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