USPS Ends Volume Discounts for Certain International Mailers

The U.S. Postal Service published a final rule in the Federal Register yesterday that eliminates volume discounts for mailers who spent $2 million or more combined on International Priority Airmail and International Surface Air Lift in the preceding postal fiscal year.

The ruling also took effect yesterday.

International Priority Airmail is a volume air mail service providing worldwide delivery for businesses sending mail weighing up to four pounds. This can include invoices, direct mail, catalogs, small merchandise packages and business correspondence.

International Surface Air Lift is a bulk mailing service providing delivery of the same types of mail, but with a minimum volume of 50 pounds per mailing. ISAL shipments are flown to foreign destinations and entered into a country’s surface or non-priority mail system for delivery.

These discounts range up to 10 percent, the USPS said.

The USPS based the change on recent reviews of costs for providing these services, according to the filing. The reviews identified increases in transportation, terminal dues and other costs “that have all risen, while published rates for IPA and ISAL have remained static since 2001,” the USPS said. When costs rise above the rate the agency charges, “we are obliged to adjust prices and discounts [in this case IPA and ISAL] so they are not subsidized by other domestic or international product offerings.”

The USPS said the changes do not affect standards for existing or prospective customers who use IPA or ISAL mail and participate or wish to participate in the postal service’s International Customized Mail service agreement, which offers customized discounted rates with international mailers that last one year. In these arrangements, the discount’s size depends on the customer’s volume or revenue and is adjusted quarterly based on the volume mailed in the preceding quarter.

The USPS said that most people use the ICM program and access the discounts through the ICMs, and it decided to discontinue the published IPA and ISAL discounts.

On July 28, the USPS published a proposed rule on the issue in the Federal Register and requested comments by Aug. 18. Comments were received from two parties, one who opposed the proposal and one whose comment was outside the scope of the proposed rule.

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