CPC International Postal Update

There have been several significant recent developments on international mail and postal delivery.

Universal Postal Union

In an August 23 memorandum, President Trump raised strong concerns about continued U.S. participation in the Universal Postal Union (UPU). This is because UPU membership results in vast subsidies and related benefits to many foreign-based shippers, particularly those from China, providing them with a competitive advantage over U.S. businesses.

On October 17, The White House announced that the United States would begin a one-year withdrawal process from the UPU. Negotiations between the U.S. and UPU are continuing.

U.S. Advanced Electronic Data Requirements

Effective January 1, 2019, 70 percent of international mail entering the United States, and all mail from China, must have advanced electronic data (AED), information such as the sender’s name, destination and declared contents. The AED requirement, which will help U.S. law enforcement better identify and seize opioids in the mail, follows enactment of The STOP Act in October.

Canadian Postal Strikes

Canadian postal workers launched a series of rotating strikes beginning on October 22. The Canadian Union of Postal Workers (CUPW) organized a series of 24-hour strikes that cycled through Canadian provinces until early December, disrupting and delaying mail delivery as the country approached Christmas. Workers demanded that the Canada Post resolve a pay disparity between rural and urban workers, in addition to a universal improvement of benefits.

After a month of postal disruptions and no deal between the Canada Post and the CUPW in sight, Prime Minister Justin Trudeau’s government enacted legislation in early December that forced strikers back to work. Labor unions protested the decision as an attack on workers, but Trudeau urged Parliament to not allow the strike to interfere with holiday shopping. The dispute is currently awaiting the judgment of a neutral mediator.

Royal Mail CEO Resigns

After an eight-year tenure, Moya Greene resigned as chief executive of the U.K.’s Royal Mail and handed over the reins to Rick Back. The change in leadership prompted an outcry over what many saw as excessive executive pay at the Royal Mail. The postal service offered Back a yearly package of £2.7m, 17 percent higher than Greene’s salary, and it awarded the outgoing executive an exit payment of £900,000.

Israel Plans Partial Privatization

A governing committee of Israel’s state-owned postal services gave the government the green light to sell 40 percent of the enterprise. The Israeli government will allow an investor to initially buy 20 percent of the services’ stock, with an additional 20 percent being sold on the stock exchange within two years. According to The Times of Israel, the move is meant to combat falling profits and effectiveness plaguing the services.

India Post Opens Bank

India’s national post office opened its own bank, the India Post Payments Bank, on September 1, 2018. The new service aims to bring modern and online banking to India’s rural areas, according to the local CNBC affiliate.

India Post also launched an e-commerce site for Indian small businesses loosely modeled after Amazon. It anticipates that the new service will enable local artisans and vendors to increase sales throughout India.

Japanese Next-Day Delivery Falters

The Japan Post introduced a next-day delivery service this year, hoping to provide the convenience at the same cost as regular delivery. But it appears the burden of the new service is putting pressure on Japan to revise the practice. The Japan Times reported in November that Japan Post is requesting a legislative curtailing of its service, hoping to limit delivery to week days.

About the Author: John Cicchitti is a Research Fellow with the Consumer Postal Council.