A bill to amend section 5402 of title 39, United States Code, to modify the authority relating to United States Postal Service air transportation contracts, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Air Carriage of International Mail 
Act''.

SEC. 2. AIR CARRIAGE OF INTERNATIONAL MAIL.

    (a) Contracting Authority.--Section 5402 of title 39, United States 
Code, is amended by striking subsections (b) and (c) and inserting the 
following:
    ``(b) International Mail.--
        ``(1) In general.--
            ``(A) Except as otherwise provided in this subsection, the 
        Postal Service may contract for the transportation of mail by 
        aircraft between any of the points in foreign air 
        transportation only with certificated air carriers. A contract 
        may be awarded to a certificated air carrier to transport mail 
        by air between any of the points in foreign air transportation 
        that the Secretary of Transportation has authorized the carrier 
        to serve either directly or through a code-share relationship 
        with one or more foreign air carriers.
            ``(B) If the Postal Service has sought offers or proposals 
        from certificated air carriers to transport mail in foreign air 
        transportation between points, or pairs of points within a 
        geographic region or regions, and has not received offers or 
        proposals that meet Postal Service requirements at a fair and 
        reasonable price from at least 2 such carriers, the Postal 
        Service may seek offers or proposals from foreign air carriers. 
        Where service in foreign air transportation meeting the Postal 
        Service's requirements is unavailable at a fair and reasonable 
        price from at least 2 certificated air carriers, either 
        directly or through a code-share relationship with one or more 
        foreign air carriers, the Postal Service may contract with 
        foreign air carriers to provide the service sought if, when the 
        Postal Service seeks offers or proposals from foreign air 
        carriers, it also seeks an offer or proposal to provide that 
        service from any certificated air carrier providing service 
        between those points, or pairs of points within a geographic 
        region or regions, on the same terms and conditions that are 
        being sought from foreign air carriers.
            ``(C) For purposes of this subsection, the Postal Service 
        shall use a methodology for determining fair and reasonable 
        prices for the Postal Service designated region or regions 
        developed in consultation with, and with the concurrence of, 
        certificated air carriers representing at least 51 percent of 
        available ton miles in the markets of interest.
            ``(D) For purposes of this subsection, ceiling prices 
        determined pursuant to the methodology used under subparagraph 
        (C) shall be presumed to be fair and reasonable if they do not 
        exceed the ceiling prices derived from--
                ``(i) a weighted average based on market rate data 
            furnished by the International Air Transport Association or 
            a subsidiary unit thereof; or
                ``(ii) if such data are not available from those 
            sources, such other neutral, regularly updated set of 
            weighted average market rates as the Postal Service, with 
            the concurrence of certificated air carriers representing 
            at least 51 percent of available ton miles in the markets 
            of interest, may designate.
            ``(E) If, for purposes of subparagraph (D)(ii), concurrence 
        cannot be attained, then the most recently available market 
        rate data described in this subparagraph shall continue to 
        apply for the relevant market or markets.
        ``(2) Contract process.--The Postal Service shall contract for 
    foreign air transportation as set forth in paragraph (1) through an 
    open procurement process that will provide--
            ``(A) potential offerors with timely notice of business 
        opportunities in sufficient detail to allow them to make a 
        proposal;
            ``(B) requirements, proposed terms and conditions, and 
        evaluation criteria to potential offerors; and
            ``(C) an opportunity for unsuccessful offerors to receive 
        prompt feedback upon request.
        ``(3) Emergency or unanticipated conditions; inadequate lift 
    space.--The Postal Service may enter into contracts to transport 
    mail by air in foreign air transportation with a certificated air 
    carrier or a foreign air carrier without complying with the 
    requirements of paragraphs (b)(1) and (2) if--
            ``(A) emergency or unanticipated conditions exist that make 
        it impractical for the Postal Service to comply with such 
        requirements; or
            ``(B) its demand for lift exceeds the space available to it 
        under existing contracts and--
                ``(i) there is insufficient time available to seek 
            additional lift using procedures that comply with those 
            requirements without compromising the Postal Service's 
            service commitments to its own customers; and
                ``(ii) the Postal Service first offers any certificated 
            air carrier holding a contract to carry mail between the 
            relevant points the opportunity to carry such excess 
            volumes under the terms of its existing contract.
    ``(c) Good Faith Effort Required.--The Postal Service and potential 
offerors shall put a good-faith effort into resolving disputes 
concerning the award of contracts made under subsection (b).''.
    (b) Conforming Amendments to Title 49.--
        (1) Section 41901(a) is amended by striking ``39.'' and 
    inserting ``39, and in foreign air transportation under section 
    5402(b) and (c) of title 39.''.
        (2) Section 41901(b)(1) is amended by striking ``in foreign air 
    transportation or''.
        (3) Section 41902 is amended--
            (A) by striking ``in foreign air transportation or'' in 
        subsection (a);
            (B) by striking subsection (b) and inserting the following:
    ``(b) Statements on Places and Schedules.--Every air carrier shall 
file with the United States Postal Service a statement showing--
        ``(1) the places between which the carrier is authorized to 
    transport mail in Alaska;
        ``(2) every schedule of aircraft regularly operated by the 
    carrier between places described in paragraph (1) and every change 
    in each schedule; and
        ``(3) for each schedule, the places served by the carrier and 
    the time of arrival at, and departure from, each such place.'';
            (C) by striking ``subsection (b)(3)'' each place it appears 
        in subsections (c)(1) and (d) and inserting ``subsection 
        (b)(2)''; and
            (D) by striking subsections (e) and (f).
        (4) Section 41903 is amended by striking ``in foreign air 
    transportation or'' each place it appears.
        (5) Section 41904 is amended--
            (A) by striking ``to or in foreign countries'' in the 
        section heading;
            (B) by striking ``to or in a foreign country'' and 
        inserting ``between two points outside the United States''; and
            (C) by inserting after ``transportation.'' the following: 
        ``Nothing in this section shall affect the authority of the 
        Postal Service to make arrangements with noncitizens for the 
        carriage of mail in foreign air transportation under 
        subsections 5402(b) and (c) of title 39.''.
        (6) Section 41910 is amended by striking the first sentence and 
    inserting ``The United States Postal Service may weigh mail 
    transported by aircraft between places in Alaska and make 
    statistical and -administrative computations necessary in the 
    interest of mail service.''.
        (7) Chapter 419 is amended--
            (A) by striking sections 41905, 41907, 41908, and 41911; 
        and
            (B) redesignating sections 41906, 41909, 41910, and 49112 
        as sections 41905, 41906, 41907, and 41908, respectively.
        (8) The chapter analysis for chapter 419 is amended by 
    redesignating the items relating to sections 41906, 41909, 41910, 
    and 49112 as relating to sections 41905, 41906, 41907, and 41908, 
    respectively.
        (9) Section 101(f) of title 39, United States Code, is amended 
    by striking ``mail and shall make a fair and equitable distribution 
    of mail business to carriers providing similar modes of 
    transportation services to the Postal Service.'' and inserting 
    ``mail.''.
        (10) Subsections (b) and (c) of section 3401 of title 39, 
    United States Code, are amended--
            (A) by striking ``at rates fixed and determined by the 
        Secretary of Transportation in accordance with section 41901 of 
        title 49'' and inserting ``or, for carriage of mail in foreign 
        air transportation, other air carriers, air taxi operators or 
        foreign air carriers as permitted by section 5402 of this 
        title'';
            (B) by striking ``at rates not to exceed those so fixed and 
        determined for scheduled United States air carriers'';
            (C) by striking ``scheduled'' each place it appears and 
        inserting ``certificated''; and
            (D) by striking the last sentence in each such subsection.
        (11) Section 5402(a) of title 39, United States Code, is 
    amended--
            (A) by inserting ```foreign air carrier'.'' after 
        ```interstate air transportation','' in paragraph (2);
            (B) by redesignating paragraphs (7) through (23) as 
        paragraphs (8) through (24) and inserting after paragraph (6) 
        the following:
        ``(7) the term `certificated air carrier' means an air carrier 
    that holds a certificate of public convenience and necessity issued 
    under section 41102(a) of title 49;'';
            (C) by redesignating paragraphs (9) through (24), as 
        redesignated, as paragraphs (10) through (25), respectively, 
        and inserting after paragraph (8) the following:
        ``(9) the term `code-share relationship' means a relationship 
    pursuant to which any certificated air carrier or foreign air 
    carrier's designation code is used to identify a flight operated by 
    another air carrier or foreign air carrier;''; and
            (D) by inserting ``foreign air carrier,'' after ``terms'' 
        in paragraph (2).
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2008.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.

Summary: Air Carriage of International Mail Act - (Sec. 2) Authorizes the U.S. Postal Service to contract, through an open procurement process, for air transportation of mail between foreign points only with certificated air carriers (carriers that hold a certificate of public convenience and necessity issued under specified provisions). Allows a contract to be awarded to transport mail between any foreign points the Secretary of Transportation has authorized the carrier to serve either directly or through a code-share relationship.

Requires that the Postal Service use a method for determining fair and reasonable prices developed in consultation with, and with the concurrence of, certificated air carriers representing at least 51% of available ton miles in the markets of interest. Presumes ceiling prices determined by that method to be fair and reasonable if they do not exceed the ceiling prices derived from a weighted average based on market rate data furnished by the International Air Transport Association (or its subsidiary unit) or such other neutral weighted average market rates as the Postal Service, with the concurrence of such air carriers representing at least 51% of available ton miles, may designate.

Provides for exceptions for emergency or unanticipated conditions or inadequate lift space.

Removes provisions requiring that the Secretary of Transportation set prices to be paid by the Postal Service for the transportation of mail by aircraft in foreign air transportation.

Removes references to foreign air transportation from provisions relating to a duty to provide certain transportation of mail.

Authorizes the Postal Service to weigh mail transported by aircraft between places in Alaska and make statistical and administrative computations necessary in the interest of mail service. (Current law does not restrict that authorization to flights between places in Alaska.)

Removes a requirement that the Postal Service make a fair and equitable distribution of mail business to carriers providing similar modes of transportation.

Modifies provisions regarding the mail of members of the U.S. Armed Forces and of friendly foreign nations.