Postal remuneration concerns to be voted on by UPU members

By Michael Baadke

Member countries of the Universal Postal Union will vote on proposals to alter the agency’s current system of remunerating international postal exchanges, also known as the terminal dues system.

Options for changing the reimbursement system were the topic of discussion during an April 9 UPU conference.

The remuneration system compensates the postal operators of destination countries for the cost of handling, transporting and delivering postal items from abroad, according to the UPU.

In an Aug. 23, 2018, memorandum, President Donald J. Trump argued that the UPU’s current terminal dues rates “undermine the goal of unrestricted and undistorted competition in cross-border delivery services.”

That dissatisfaction was conveyed to the UPU director general and led to the State Department announcing last year that the United States, a UPU founding member, will withdraw from the agency after 144 years of membership.

That withdrawal process is underway and is expected to be completed in October.

No immediate changes to the remuneration system were announced following the April 9 conference, but a statement issued by the UPU the next day described three options for change that will be voted on by the UPU’s member countries: to allow member countries to self-declare postal rates; to accelerate rate increases already approved by the UPU; and a convergence option that also adopts self-declared rates as its basis, but with elements aimed at mitigating undue price impacts.

The member nations will first choose whether to vote by postal ballot or at a UPU extraordinary congress in September.

The UPU is a United Nations specialized agency that facilitates the exchange of mail between countries worldwide.

The April 9 conference, titled “UPU Remuneration Systems — New Frontiers for an Old World?” was described by the agency as the first of its kind, calling for “broad consultation from stakeholders on improving the systems used to remunerate international postal exchanges.”

In his opening remarks, UPU Director General Bishar A. Hussein observed that the conference would address the challenges facing postal remuneration.

Stakeholders from commercial organizations, consulting groups, postal operators and other groups commented during the three sessions of the conference on the subjects of the cross-border delivery market, market drivers in the cross-border market, and the way forward for reshaping the UPU remuneration systems.

UPU Deputy Director General Pascal Clivaz said the conference provided a platform for sharing information as members choose how to proceed with the question of terminal dues.

After remarking on the day of discussion and the decision to hold a vote, Hussein said, “I look forward to working with every member country as we go forward to ensure that we do what is best for the Union, the consumer, and the international postal system.”

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