[Federal Register Volume 73, Number 110 (Friday, June 6, 2008)]
[Notices]
[Pages 32365-32366]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-12767]


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POSTAL REGULATORY COMMISSION

 [Docket No. CP2008-5; Order No. 78]


Global Expedited Package Services Negotiated Service Agreements

AGENCY: Postal Regulatory Commission.

ACTION: Notice.

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SUMMARY: A new law gives the Postal Service considerable pricing 
flexibility for competitive products. Pursuant to this authority, the 
Postal Service has filed two notices with the Commission concerning 
prices for Global Expedited Package Services (GEPS) contracts, which is 
in the competitive category. The Commission has established a 
consolidated docket for consideration of these pricing decisions. This 
will allow interested persons an opportunity to comment.

DATES: Comments due June 16, 2008.

ADDRESSES: Submit documents 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: On May 20, 2008, the Postal Service filed 
two notices, which have been assigned to Docket Nos. CP2008-4 and 
CP2008-5, announcing prices and classification changes for competitive 
products not of general applicability. The notice in Docket No. CP2008-
4 informs the Commission that ``the Governors have established prices 
and classifications for competitive products not of general 
applicability for Global Expedited Package Services (GEPS) contracts.'' 
\1\ The Postal Service attached a revision of the draft Mail 
Classification Schedule (MCS) (section 2610.2) concerning GEPS

[[Page 32366]]

contracts to the Notice.\2\ Docket No. CP2008-4 has been filed pursuant 
to 39 U.S.C. 3632(b)(3) and 39 CFR 3015.5 and 3020.90. In support of 
this docket, the Postal Service has also filed materials under seal, 
including the Governors' decision. The Postal Service claims that 
``[c]ontract prices are highly confidential in the business world * * * 
[and that its] ability * * * to negotiate individual contracts would be 
severely compromised if prices for these types of agreements were 
publicly disclosed.'' Id. at 1-2.
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    \1\ Notice of United States Postal Service of Governors' 
Decision Establishing Prices and Classifications for Global 
Expedited Package Services Contracts, May 20, 2008 (Notice).
    \2\ The draft MCS remains under review. The Commission 
anticipates providing interested persons an opportunity to comment 
on the draft MCS in the near future.
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    The notice in Docket No. CP2008-5, announces an individual 
negotiated service agreement, namely, a specific GEPS contract the 
Postal Service has entered into with an individual mailer.\3\ Docket 
No. CP2008-5 has been filed pursuant to 39 CFR 3015.5. In support of 
this docket, the Postal Service has also filed materials, including the 
contract and supporting materials, under seal. Here the Postal Service 
asserts that ``[t]he names of customers who enter into respective 
contracts and the related contract prices are highly confidential 
business information.'' Id. at 1.
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    \3\ Notice of United States Postal Service of Filing a Global 
Expedited Package Service Contract (Pricing Notice).
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    The Postal Service's filings in these dockets are related. Docket 
No. CP2008-4 establishes, in essence, a shell classification, while 
Docket No. CP2008-5 is a specific agreement negotiated pursuant to the 
conditions of the shell classification. Given this interrelationship, 
the Commission will consolidate these proceedings for purposes of 
review.\4\
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    \4\ All future filings in the consolidated docket shall be made 
under Docket No. CP2008-5.
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    In Order No. 43, the Commission issued regulations establishing a 
modern system of rate regulation, including a list of competitive 
products. PRC Order No. 43, October 29, 2007, paras. 3061, 4013. Among 
other things, the Commission determined that each negotiated service 
agreement would initially be classified as a separate product. The 
Commission also acknowledged, however, the possibility of grouping 
functionally equivalent agreements as a single product if they exhibit 
similar cost and market characteristics. Id. paras. 2177 and 3001. 
Thus, the specific GEPS agreement filed in Docket No. CP2008-5 will be 
classified as a new product.
    As noted above, the Postal Service filed both dockets pursuant to 
rule 3015.5.\5\ Recognizing that the Postal Service's filings in this 
consolidated proceeding (along with the concomitantly filed notices in 
Docket Nos. CP2008-6 and CP2008-7) represent the Postal Service's first 
filings involving competitive rates not of general applicability under 
section 3632(b)(3) of title 39, the Commission will proceed as if the 
GEPS negotiated service agreement also had been filed pursuant to 39 
CFR part 3020, subpart B. As a consequence, the Commission will review 
the consolidated dockets pursuant to rule 3020.34.\6\ Because the 
Commission in its own discretion consolidated Docket Nos. CP2008-4 and 
CP2008-5 and will review them under rule 3020.34, the Postal Service 
may, if it wishes to do so, supplement the materials already filed with 
the Commission.\7\
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    \5\ Docket No. CP2008-4 was also filed pursuant to 39 CFR 
3020.90.
    \6\ Filings to change or add rates not of general applicability 
are properly made under rule 3015.5. Postal Service filings to 
modify the product lists are properly made under part 3020, subpart 
B. Filings involving negotiated service agreements implicate both 
sets of rules until such time that a group of negotiated service 
agreements are shown to be classified properly as one product. The 
Commission anticipates that with experience and the adoption of the 
MCS, the review process will proceed relatively quickly.
    \7\ The Commission characterizes the Governors' decision and 
associated materials filed in Docket No. CP2008-4 as material that 
supports the specific negotiated service agreement filed in Docket 
No. CP2008-5.
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    In addition, the Commission directs the Postal Service to identify 
and list any contracts currently in existence (and their respective 
expiration dates) that would no longer qualify as GEPS contracts under 
the proposed revised Mail Classification Schedule language for section 
2610.2 attached to the Notice in Docket No. CP2008-4. The revised 
language modifies the GEPS eligibility criteria by, among other things, 
requiring the mailer on an annual basis to mail at least 5,000 pieces 
(instead of 600 pieces), or pay postage of at least $100,000 (instead 
of $12,000). The Commission also directs the Postal Service to provide 
a detailed justification for why it believes that GEPS contracts' 
expiration dates (without disclosing the identity of the customer) 
should not be made publicly available. Answers to the Commission's 
questions and any supplemental materials that the Postal Service plans 
to provide are due no later than June 10, 2008.
    Interested persons may express views and offer comments on whether 
the planned changes are consistent with the policies of 39 U.S.C. 3632, 
3633 or 3642. Comments are due no later than June 16, 2008.
    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 the above-captioned docket.
    It is ordered:
    1. The proceedings under Docket Nos. CP2008-4 and CP2008-5 are 
consolidated. All future filings in the consolidated docket are to be 
made under Docket No. CP2008-5.
    2. As set forth in the body of this order, the Postal Service is 
provided with an opportunity to supplement the materials already filed 
with the Commission. Any supplemental materials that the Postal Service 
wishes to provide are due no later than June 10, 2008.
    3. Comments on issues in this consolidated proceeding are due no 
later than June 16, 2008.
    4. The Commission appoints Paul L. Harrington as Public 
Representative to represent the interests of the general public in this 
proceeding.
    5. The Secretary shall arrange for publication of this notice and 
order in the Federal Register.

    By the Commission.
Steven W. Williams,
Secretary.
[FR Doc. E8-12767 Filed 6-5-08; 8:45 am]
BILLING CODE 7710-FW-P