2013-00008. New Postal Product

AGENCY:

Postal Regulatory Commission.

ACTION:

Notice.

SUMMARY:

The Commission is noticing a recent Postal Service filing concerning the addition of Global Expedited Package Services—Non-Published Rates 4 to the competitive product list. This notice informs the public of the filing, invites public comment, and takes other administrative steps.

DATES:

Comments are Due: January 8, 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. Notice of Filing

III. Ordering Paragraphs

I. Introduction

In accordance with 39 U.S.C. 3642 and 39 CFR 3020.30 et seq., and Order No. 630, the Postal Service filed a formal request and associated supporting information to add Global Expedited Package Services—Non-Published Rates 4 (GEPS-NPR 4) to the competitive product list.^[1] The Postal Service states that the addition is necessary due to changes in the non-discounted published postage for Express Mail International (EMI), Priority Mail International (PMI), and Global Express Guaranteed (GXG), as well as the creation of a new GEPS-NPR 4 model contract and accompanying financial model that differ from the GEPS-NPR 3 model contract and financial model. Request at 2-3. The Request has been assigned Docket No. MC2013-27.

The Postal Service contemporaneously filed a redacted version of the GEPS-NPR 4 model contract related to the proposed new product under 39 U.S.C. 3632(b)(3) and 39 CFR 3015.5. Id. Attachment 4. The instant contract has been assigned Docket No. CP2013-35.

Request. To support its Request, the Postal Service filed the following attachments:

• Attachment 1—an application for non-public treatment of materials filed under seal;
• Attachment 2A—a redacted version of Governors' Decision No. 11-6;
• Attachment 2B—a revised version of MCS 2510.8 GEPS-NPR;
• Attachment 2C—a redacted version of Management's Analysis of the Prices and Methodology for Determining Prices For Negotiated Service Agreements Under Global Expedited Package Services—Non-Published Rates 4;
• Attachment 2D—a list of Maximum and Minimum Prices for EMI, PMI, and GXG under GEPS-NPR 4 Contracts;
• Attachment 2E—a certified statement concerning prices for applicable negotiated service agreements under GEPS-NPR 4 rates, as required by 39 CFR 3015(c)(2);
• Attachment 3—a Statement of Supporting Justification similar to the Statement of Supporting Justification used to support the classification of GEPS-NPR 1, and as required by 39 CFR 3020.32;
• Attachment 4—a redacted version of the GEPS-NPR 4 model contract.

In the Statement of Supporting Justification, Frank Cebello, Executive Director, Global Business Management, asserts that the product is designed to increase the efficiency of the Postal Service's process, as well as enhance its ability to compete in the marketplace. Id. Attachment 3 at 1. Mr. Cebello states that the product is also designed to enable the Postal Service's Global Business sales force to rapidly establish, based on various factors, whether a GEPS-type agreement will be profitable enough to justify establishing an incentive-based mailing plan with the customer for EMI, PMI, and GXG (if the customer uses Global Shipping Software). Id. Attachment 3 at 2. In order to accomplish this, the GEPS-NPR 4 product revises the product designs for GEPS-NPR 1, GEPS-NPR 2, and GEPS-NPR 3 to include actual rates that will cover their costs, and will eliminate the need for each customer agreement to be added to the competitive product list individually. Id. Attachment 3 at 2, 5. Mr. Cebello contends that the financial modeling in support of the GEPS-NPR 4 product demonstrates that the product will cover its attributable costs, make a positive contribution to covering institutional costs, as well as not be subsidized by market dominant products. Id. Attachment 3 at 3.

Related model contract. The Postal Service included a redacted version of the related model contract with the Request. Id. Attachment 4. The Postal Service will notify each customer of the contract's effective date no later than 30 days after receiving the signed agreement from the customer. Id. at 7. Each contract will expire 1 year from the effective date unless terminated sooner. Id. The Postal Service filed much of the supporting materials, including the related model contract, under seal. Id. Attachment 1. It maintains that the redacted portions of the materials should remain confidential as sensitive business information. Id. at 4. This information includes sensitive commercial information concerning the incentive discounts and their formulation, applicable cost coverage, non-published rates, as well as some customer-identifying information. Id. The Postal Service asks the Commission to protect customer-identifying information from public disclosure for 10 years after the date of filing with the Commission, unless an order is entered to extend the duration of that status. Id. at 9.

II. Notice of Filings

The Commission establishes Docket Nos. MC2013-27 and CP2013-35 to consider the Request pertaining to the proposed GEPS-NPR 4 product.

Interested persons may submit comments on whether the Postal Service's filings in the captioned dockets are consistent with the policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR 3015.5, and 39 CFR part 3020, subpart B. Comments are due no later than January 8, 2013. The public portions of these filings can be accessed via the Commission's Web site (http://www.prc.gov).

The Commission appoints James F. Callow to serve as Public Representative in these dockets.

III. Ordering Paragraphs

It is ordered:

1. The Commission establishes Docket Nos. MC2013-27 and CP2013-35 to consider the matters raised in each docket.

2. Pursuant to 39 U.S.C. 505, James F. Callow 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 January 8, 2013.

4. The Secretary shall arrange for publication of this order in the Federal Register.

By the Commission.

Shoshana M. Grove,

Secretary.

Footnotes

1.  Request of the United States Postal Service to Add Global Expedited Package Services—Non-Published Rates 4 (GEPS-NPR 4) to the Competitive Products List and Notice of Filing GEPS-NPR 4 Model Contract and Application for Non-Public Treatment of Materials Filed Under Seal, December 21, 2012 (Request).