[Federal Register Volume 74, Number 111 (Thursday, June 11, 2009)]
[Notices]
[Pages 27842-27843]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-13745]


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POSTAL REGULATORY COMMISSION

[Docket No. CP2009-35; Order No. 221]


Global Expedited Package Services 1 Contract

AGENCY: Postal Regulatory Commission.

ACTION: Notice.

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SUMMARY: The Commission is noticing a recently-filed Postal Service 
request to add an additional Global Expedited Package Services 1 
negotiated service agreement to the Competitive Product List. This 
notice addresses procedural steps associated with this filing.

DATES: Comments are due June 11, 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. Background

    On June 1, 2009, the Postal Service filed a notice announcing that 
it has entered into an additional Global Expedited Package Services 1 
(GEPS 1) contract.\1\ GEPS 1 provides volume-based incentives for 
mailers that send large volumes of Express Mail International (EMI) 
and/or Priority Mail International (PMI). The Postal Service believes 
the instant contract is functionally equivalent to previously submitted 
GEPS contracts, and is supported by the Governors' Decision filed in 
Docket No. CP2008-5.\2\ Notice at 1. It further notes that in Order No. 
86, which established GEPS 1 as a product, the Commission held that 
additional contracts may be included as part of the GEPS 1 product if 
they meet the requirements of 39 U.S.C. 3633, and if they are 
functionally equivalent to the

[[Page 27843]]

initial GEPS 1 contract filed in Docket No. CP2008-5.\3\ Id. at 1.
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    \1\ Notice of United States Postal Service Filing of 
Functionally Equivalent Global Expedited Package Services 1 
Negotiated Service Agreement, June 1, 2009 (Notice).
    \2\ See Docket No. CP2008-5, Decision of the Governors of the 
United States Postal Service on the Establishment of Prices and 
Classifications for Global Expedited Package Services Contracts 
(Governors' Decision No. 08-7), May 6, 2008, and United States 
Postal Service Notice of Filing Redacted Copy of Governors' Decision 
No. 08-7, July 23, 2008.
    \3\ See PRC Order No. 86, Order Concerning Global Expedited 
Package Services Contracts, June 27, 2008, at 7 (Order No. 86).
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    The instant contract. The Postal Service filed the instant contract 
pursuant to 39 CFR 3015.5. In addition, the Postal Service contends 
that the contract is in accordance with Order No. 86. It submitted the 
contract and supporting material under seal, and attached a redacted 
copy of the contract and certified statement required by 39 CFR 
3015.5(c)(2) to the Notice as Attachments 1 and 2, respectively.\4\ Id. 
at 1-2. On June 3, 2009, the Post revised information under seal to 
replace information originally filed under seal and an updated 
Certification of Compliance with 39 U.S.C. 3633.\5\ The term of the 
contract is one year from the date the Postal Service notifies the 
customer that all necessary regulatory approvals have been received.
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    \4\ Attachment 1 to the Notice consists of a redacted version of 
the contract. Attachment 2 is a redacted Certification of Compliance 
with 39 U.S.C. 3633.
    \5\ Notice of United States Postal Service Filing (Under Seal) 
of Revised Information and Revised Certification, June 3, 2009.
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    The Notice addresses reasons why the instant GEPS 1 contract fits 
within the Mail Classification Schedule language for GEPS 1. The Postal 
Service explains that the instant contract is functionally equivalent 
to the GEPS 1 contracts filed previously because it shares similar cost 
and market characteristics and, therefore, the contracts should be 
classified as a single product. Id. at 3. It states that in Governors' 
Decision No. 08-7, a pricing formula and classification system was 
established to ensure that each contract meets the statutory and 
regulatory requirements of 39 U.S.C. 3633. The Postal Service affirms 
that the instant contract demonstrates its functional equivalence with 
the previous GEPS 1 contracts because of several factors: The contract 
term of one year which applies to all GEPS 1 contracts, requirement of 
payment through permit imprint, and its total costs are volume variable 
as are the total costs associated with all GEPS 1 contracts. Id. at 4. 
It explains that even though prices may be different based on volume or 
postage commitments made by the customers, these differences do not 
affect the contracts' functional equivalency because the total costs 
associated with GEPS 1 contracts are volume variable.
    The Postal Service also states the instant contract has minor 
differences reflected in the language of this agreement compared to 
other GEPS 1 contracts. Id. These differences include provisions which 
reflect differences between the mailers including: (1) Language which 
addresses the connection between completion of the regulatory review 
process and expiration of a previous or existing agreement, if 
applicable; \6\ (2) terms which clarify that other Postal Service 
products are available to the customer subject to the same regulatory 
standards as other mailers in general; (3) exclusion of certain flat 
rate products from the mail qualifying for discounts; (4) requiring the 
mailer to provide notice of intent to mail and to conform with the 
acceptance times and scheduling procedures at the acceptance site; (5) 
specific liquidated damages terms negotiated with this mailer; (6) 
terms to explain the mailer's volume and revenue commitment calculation 
upon early termination of the contract; and (7) clarifying language for 
regulatory entity obligations related to the contract or revisions to 
update terms or references from a prior agreement. Id. at 4-6.
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    \6\ The Postal Service states that some of the contracts 
generally provide that if all applicable reviews have not been 
completed at the time an older contract expires, the mailer must pay 
published prices until some alternative becomes available. Because 
in the instant contract the mailer is a new customer, this provision 
is not included.
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    The Postal Service states that these differences related to 
particular mailers are ``incidental differences'' and do not change the 
conclusion that these agreements are functionally equivalent in a 
substantive aspect. Id. at 6.
    The Postal Service requests that this contract be included within 
the GEPS 1 product. Id.

II. Notice of Filing

    The Commission establishes Docket No. CP2009-35 for consideration 
of matters related to the contract identified in the Postal Service's 
Notice.
    Interested persons may submit comments on whether the Postal 
Service's contract is consistent with the policies of 39 U.S.C. 3632, 
3622 or 3642. Comments are due no later than June 11, 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 the captioned filings.
    It is Ordered:
    1. The Commission establishes Docket No. CP2009-35 for 
consideration of the matters raised in this 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 June 11, 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. E9-13745 Filed 6-10-09; 8:45 am]
BILLING CODE 7710-FW-P