Docket No. PI2012-1	- 4 -

ORDER NO. 1420

UNITED STATES OF AMERICA

POSTAL REGULATORY COMMISSION

WASHINGTON, DC 20268-0001

Before Commissioners:	Ruth Y. Goldway, Chairman;Nanci E. Langley, Vice Chairman;

	Mark Acton;	Tony Hammond; and	Robert G. Taub

Section 407 Inquiry	Docket No. PI2012-1

NOTICE PROVIDING OPPORTUNITY TO COMMENT

ON DEVELOPMENT OF COMMISSION VIEWS

PURSUANT TO 39 U.S.C. 407(c)(1)

(Issued July 31, 2012)

# INTRODUCTION

The Commission anticipates receiving a request from the Secretary of State, pursuant to 39 U.S.C. 407(c)(1), for its views on whether proposals affecting market dominant rates and classifications for international postal products and services exchanged among postal administrations, to be negotiated this fall at the 25th Congress of the Universal Postal Union (UPU), are consistent with the standards and criteria for modern rate regulation established by the Commission under 39 U.S.C. 3622.

The Commission invites public comment on the principles that should guide the development of its views.

# Background

*The role of the State Department*.  The U.S. Department of State is responsible for formulating, coordinating, and overseeing foreign policy related to international postal services and other international delivery services, and has the power to conclude postal treaties, conventions, and amendments, subject to a condition related to competitive products.  39 U.S.C. 407(b)(1).  In carrying out these responsibilities, the Secretary of State exercises primary authority for the conduct of foreign policy with respect to international postal services and other international delivery services, including the determination of United States positions and the conduct of United States participation in negotiations with foreign governments and international bodies.  *Id*. at 407(b)(2).  In exercising this authority, the Secretary of State is, among other things, to coordinate with other agencies as appropriate, and in particular, to give full consideration to the authority vested by law or Executive Order in certain Federal entities, including the Postal Regulatory Commission.  *Id*. at 407(b)(2)(A).

*The role of the Commission*.  Before concluding any treaty, convention, or amendment that establishes a rate or classification for a product subject to subchapter I of chapter 36 [provisions relating to market dominant products], the Secretary of State is to request that the Commission submit its views on whether such rate or classification is consistent with the standards and criteria established by the Commission under section 3622.  *Id*. at 407(c)(1).[footnoteRef:1]  The Secretary must then ensure that each treaty, convention, or amendment concluded under section 407(b) is consistent with the views submitted by the Commission except if, or to the extent the Secretary determines, in writing, that ensuring such consistency is not in the foreign policy or national security interest of the United States.  *Id*. at 407(c)(2). [1:  The Commission established a modern system of regulation in Order No. 43 (issued October 29, 2007).] 

*The role of the UPU*.  The UPU is a specialized agency of the United Nations.  It is the primary forum for cooperation between governments, posts, regulators and other postal-sector stakeholders.  UPU Biennial Report 2009–2010 at 2.  In terms of UPU organization and terminology the United States is a member country, the Department of State is the ministry, the Commission is the regulator, and the Postal Service is the operator.

Every four years, the UPU Congress meets “to define the future world postal strategy, the Union’s four-year roadmap, and lay down standards and regulations which facilitate and increase the security of international exchanges of mail and parcels, as well as the delivery of a broad range of secure and affordable electronic and financial services.”[footnoteRef:2]  The UPU will hold its 25th Congress in Doha, Qatar this fall (from September 24 to October 15, 2012).  As matters that affect “postal treaties, conventions, and amendments” will be considered in Doha, section 407 requirements come into play. [2:  http://www.upu.int/the-upu/congress/about-congress.html.] 

In anticipation of receipt of the Secretary of State’s request under section 407(c)(1), the Commission invites public comment on the principles that should guide development of its views on the consistency of proposals for “rates and classification of products subject to subchapter I of chapter 36” with the standards and criteria of 39 U.S.C. § 3622.

Comments are to be submitted via the Commission’s *Filing Online* system at *http://www.prc.gov*unless a request for waiver is approved.  For assistance with filing, contact Joyce Taylor at 202-789-6846 or *dockets@prc.gov*.

*Public Representative*.  Section 505 of title 39 requires the designation of an officer of the Commission (public representative) to represent the interests of the general public in all public proceedings.  The Commission hereby designates Emmett Rand Costich as Public Representative in this proceeding.

# Ordering Paragraphs

*It is ordered*:

The Commission establishes Docket No. PI2012-1 for the purpose of receiving comments on the principles that should guide the development of its section 407 views on rate and classification proposals subject to subchapter I of chapter 36 of title 39 of the U.S. Code [provisions relating to market dominant products].

Comments are due by August 20, 2012.

Emmett Rand Costich is designated as the Public Representative to represent the interests of the general public in this docket.

The Secretary shall arrange for publication of this Notice in the *Federal Register.*

By the Commission.

Shoshana M. Grove

Secretary