[Federal Register Volume 78, Number 131 (Tuesday, July 9, 2013)]
[Notices]
[Pages 41128-41129]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-16473]


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POSTAL REGULATORY COMMISSION

[Docket No. MT2013-2; Order No. 1771]


Market Test of International Merchandise Return Service

AGENCY: Postal Regulatory Commission.

ACTION: Notice

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SUMMARY: The Commission is noticing a recently-filed Postal Service 
proposal to conduct a market test of a competitive experimental product 
called International Merchandise Return Service-Non-Published Rates 
(IMRS-NPR). This notice informs the public of the filing, invites 
public comment, and takes other administrative steps.

DATES: Comments are due: July 15, 2013.

ADDRESSES: Submit comments electronically via the Commission's Filing 
Online system at http://www.prc.gov. Those who cannot submit comments 
electronically should contact the person identified in the FOR FURTHER 
INFORMATION CONTACT section by telephone for advice on filing 
alternatives.

FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel, 
at 202-789-6820.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction
II. Background
III. Contents of Filing
IV. Notice of Filing
V. Ordering Paragraphs

I. Introduction

    On July 1, 2013, the Postal Service filed a notice, pursuant to 39 
U.S.C. 3641, announcing its intent to conduct a market test of a 
competitive experimental product called International Merchandise 
Return Service--Non-Published Rates (IMRS-NPR).\1\ IMRS-NPR is 
comprised of Air Parcels or Express Mail Service packages returning to 
the United States that originate from a foreign territory served by 
another postal operator with which the Postal Service has made an 
arrangement for a return service. Id. at 2. The market test is 
scheduled to begin on or shortly after August 15, 2013 and continue for 
two calendar years. Id. at 6.
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    \1\ Notice of the United States Postal Service of Market Test of 
Experimental Product--International Merchandise Return Service--Non-
Published Rates (IMRS-NPR) and Notice of Filing IMRS-NPR Model 
Contract and Application for Non-Public Treatment of Materials Filed 
Under Seal, July 1, 2013 (Notice).
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II. Background

    IMRS-NPR items consist of returned merchandise that consumers 
purchased through online retailers in the United States. Id. at 2. 
IMRS-NPR will enable foreign consumers to create return labels and 
postage payment to return products back to the United States. Id. The 
consumer can create his or her own shipping label and send it to the 
merchant through the consumer's postal channel.
    The Postal Service explains that many shipping companies create 
methods to improve ease of use by creating labels for the merchants and 
either sending the labels by email to their customers or providing 
labels for use if an item is returned. Id. It states that returns are 
an inevitable part of international online commerce, and customers 
consider returns as an important part of

[[Page 41129]]

international shipping. Id. It concludes that the IMRS-NPR market test 
will increase the overall value of the services the Postal Service can 
offer to consumers. Id.
    Statutory authority. The Postal Service indicates that its proposal 
satisfies the criteria of 39 U.S.C. 3641, which imposes certain 
conditions on experimental products. The Postal Service asserts that 
IMRS-NPR is significantly different from all products offered within 
the past 2 years. Id. at 3-4; see 39 U.S.C. 3641(b)(1). It explains 
that there are only two existing international return solutions offered 
by the Postal Service, and neither has the same scope as IMRS-NPR. Id. 
at 4.
    The Postal Service states that it does not expect IMRS-NPR, which 
is designed to provide U.S. merchants an international merchandise 
returns solution through the postal network, to create an ``unfair or 
otherwise inappropriate competitive advantage for the Postal Service or 
any mailer'' particularly with regard to small businesses. It indicates 
that it is unaware of any small business offering a similar return 
service, and that it expects small businesses to utilize the service. 
Id. at 5; see 39 U.S.C. 3641(b)(2). The Postal Service classifies IMRS-
NPR as a competitive product because IMRS-NPR is designed for packages 
that do not fall under the Private Express Statutes. Id.; see 39 U.S.C. 
3641(b)(3). It notes that FedEx, UPS, and DHL each have products for 
their returns. Id. at 6.
    Duration. The Postal Service states that the market test will begin 
on or shortly after August 15, 2013 and run for two calendar years. Id. 
The Postal Service intends to offer negotiated service agreements to 
customers during the two year market test period, and the contracts 
will have standard one-year terms. Id. To the extent that negotiated 
service agreements have terms that extend beyond the two-year period of 
the market test, the Postal Service requests that the Notice serve as 
an application for extension under 39 U.S.C. 3641(d). Id. It asserts 
that the extension would only be requested to satisfy existing 
contractual obligations, and no new agreements would be initiated with 
merchants after the two-year period of the market test. Id. at 6-7.
    Revenues. The Postal Service does not anticipate revenues from 
IMRS-NPR to exceed $10 million in any year, subject to inflation. Id. 
at 7; see 39 U.S.C. 3641(e). If circumstances change, the Postal 
Service states that it will seek further relief upon submission of an 
application for exemption from the $10 million limitation. Id. at 7.
    Market test scope. The Postal Service intends to offer IMRS-NPR for 
returns originating in Australia and Canada pursuant to amendments to 
bilateral agreements with the postal operators of these countries 
through the air parcel stream. Id. It states that it may negotiate 
additional bilateral agreements with other foreign postal operators to 
offer the same service for returns from other countries using either 
air parcels or EMS. Id. If the Postal Service executes such 
arrangements, it intends to provide notice to the Commission and 
furnish updated model contract, prices, and supporting financial 
information in this docket. Id.
    Data collection. The Postal Service states that data would be 
reported at quarterly intervals following the conclusion of the term of 
each agreement. Id. at 8. Spreadsheets would include the costs, 
revenues, and volumes associated with each agreement. Id.

III. Contents of Filing

    The notice includes the following attachments:
     Attachment 1--an application for non-public treatment of 
materials filed under seal;
     Attachment 2--Mail Classification Schedule language for 
IMRS-NPR;
     Attachment 3--a redacted copy of the IMRS Management 
Analysis; and
     Attachment 4--a redacted copy of the IMRS model customized 
global agreement.
    Materials filed under seal include unredacted copies of the IMRS 
Management Analysis, IMRS model customized global agreement, and 
supporting financial workpapers. Id. at 1. The Postal Service filed 
redacted versions of the financial workpapers as public Excel files.

IV. Notice of Filing

    The Commission establishes Docket No. MT2013-2 to consider matters 
raised by the Notice. It encourages interested persons to review the 
Notice for more details. Interested persons may submit comments on 
whether the Postal Service's filing in the captioned docket is 
consistent with the policies of 39 U.S.C. 3641. Comments are due no 
later than July 15, 2013. The filing can be accessed via the 
Commission's Web site (http://www.prc.gov).
    The Commission appoints Alison J.W. MacDonald to serve as Public 
Representative in this docket.

V. Ordering Paragraphs

    It is ordered:
    1. The Commission establishes Docket No. MT2013-2 to consider 
matters raised by the Notice.
    2. Pursuant to 39 U.S.C. 505, Alison J.W. MacDonald is appointed to 
serve as an officer of the Commission (Public Representative) to 
represent the interests of the general public in this proceeding.
    3. Comments by interested persons are due no later than July 15, 
2013.
    4. The Secretary shall arrange for publication of this order in the 
Federal Register.

    By the Commission.
Ruth Ann Abrams,
Acting Secretary.
[FR Doc. 2013-16473 Filed 7-8-13; 8:45 am]
BILLING CODE 7710-FW-P