Administrative Practice and Procedure; Postal Service, 41265-41268 [E8-16031]
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Federal Register / Vol. 73, No. 139 / Friday, July 18, 2008 / Rules and Regulations
Effective date: August 18, 2008.
U.S. Army Corps of
Engineers, ATTN: CECW–CO (David B.
Olson), 441 G Street, NW., Washington,
DC 20314–1000.
FOR FURTHER INFORMATION CONTACT: Mr.
David Olson, Headquarters, Operations
and Regulatory Community of Practice,
Washington, DC, at (202) 761–4922, Mr.
Scott Jones, Corps of Engineers,
Wilmington District, Regulatory Branch,
at (202) 761–7763, or Ms. Tracey
Wheeler, Corps of Engineers,
Wilmington District, Regulatory Branch,
at (252) 975–1616.
SUPPLEMENTARY INFORMATION: In the
April 25, 2007, issue of the Federal
Register (72 FR 20460), the Corps
published a proposed rule to designate
an existing rifle range fan as a danger
zone. The proposed danger zone is
within an existing restricted area that
was established in 1951 (16 FR 2578)
and amended in 1997 (62 FR 17553). In
response to the April 25, 2007, proposed
rule, no comments were received.
Pursuant to its authorities in section
7 of the Rivers and Harbors Act of 1917
(40 Stat. 266; 33 U.S.C. 1) and Chapter
XIX of the Army Appropriations Act of
1919 (40 Stat. 892; 33 U.S.C. 3), the
Corps amends 33 CFR 334.430 by
adding a danger zone along the Neuse
River as described below. The
regulations governing the existing
restricted area have not been changed.
DATES:
ADDRESSES:
a. Review Under Executive Order 12866
This rule is issued with respect to a
military function of the Defense
Department and the provisions of
Executive Order 12866 do not apply.
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b. Review Under the Regulatory
Flexibility Act
This rule has been reviewed under the
Regulatory Flexibility Act (Pub. L. 96–
354) which requires the preparation of
a regulatory flexibility analysis for any
regulation that will have a significant
economic impact on a substantial
number of small entities (i.e., small
businesses and small governments). The
Corps has determined that the
establishment of this danger zone will
have practically no economic impact on
the public, result in no anticipated
navigational hazard, and will not
interfere with existing waterway traffic.
This rule will have no significant
economic impact on small entities.
c. Review Under the National
Environmental Policy Act
Due to the administrative nature of
this action and because there is no
intended change in the use of the area,
16:19 Jul 17, 2008
d. Unfunded Mandates Act
This rule does not impose an
enforceable duty on the private sector
and, therefore, it is not a Federal private
sector mandate and it is not subject to
the requirements of either section 202 or
section 205 of the Unfunded Mandates
Act. We have also found under section
203 of the Act that small governments
will not be significantly and uniquely
affected by this rulemaking.
List of Subjects in 33 CFR Part 334
Danger zones, Marine safety,
Navigation (water), Restricted areas,
Waterways.
I For the reasons set out in the
preamble, the Corps amends 33 CFR
part 334, as follows:
PART 334—DANGER ZONE AND
RESTRICTED AREA REGULATIONS
1. The authority citation for part 334
continues to read as follows:
I
Authority: 40 Stat. 266 (33 U.S.C. 1) and
40 Stat. 892 (33 U.S.C. 3).
Procedural Requirements
VerDate Aug<31>2005
the Corps determined that this
regulation will not have a significant
impact to the quality of the human
environment and, therefore, preparation
of an environmental impact statement
will not be required. An environmental
assessment has been prepared. The
environmental assessment may be
reviewed at the District office listed at
the end of FOR FURTHER INFORMATION
CONTACT, above.
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I
2. Revise § 334.430 to read as follows:
§ 334.430 Neuse River and tributaries at
Marine Corps Air Station Cherry Point,
North Carolina; restricted area and danger
zone.
(a) The restricted area. That portion of
Neuse River within 500 feet of the shore
along the reservation of the Marine
Corps Air Station, Cherry Point, North
Carolina, extending from the mouth of
Hancock Creek to a point approximately
6,800 feet west of the mouth of Slocum
Creek, and all waters of Hancock and
Slocum Creeks and their tributaries
within the boundaries of the
reservation.
(b) The danger zone. The waters
within an area beginning at latitude
34.923425° N, longitude ¥76.853222°
W; thence northeasterly across Hancock
Creek to latitude 34.925258° N,
longitude ¥76.849864° W; continuing
northeasterly to latitude 34.933382° N,
longitude ¥76.835081° W; thence
northwesterly to the Neuse River
shoreline at latitude 34.936986° N,
longitude ¥76.841197° W, continuing
northwesterly to latitude 34.943275° N,
longitude ¥76.852169° W; thence
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41265
southwesterly along the shorelines to
latitude 34.935111° N, longitude
¥76.859078° W; thence southeasterly
along Hancock Creek shoreline to the
point of origin.
(c) The regulations. (1) Except in cases
of extreme emergency, all persons or
vessels, other than those operated by the
United States Navy or United States
Coast Guard, are prohibited from
entering the restricted area without
prior permission of the enforcing
agency.
(2) Entry points into the danger zone
will be prominently marked with
signage indicating the boundary of the
danger zone.
(3) Firing will take place both day and
night at irregular periods throughout the
year. Appropriate warnings will be
issued through official government and
civilian channels serving the region.
Such warnings will specify the time and
duration of operations and give such
other pertinent information as may be
required in the interest of safety. Upon
completion of firing or if the scheduled
firing is cancelled for any reason, the
warning signals marking the danger
zone will be removed.
(4) Except as otherwise provided in
this section the danger zone will be
open to general public access. Vessels,
watercraft, and other vehicles may
proceed through the danger zone.
(5) The regulation in this section shall
be enforced by the Commanding Officer,
Marine Corps Air Station Cherry Point,
North Carolina, and/or persons or
agencies as he/she may designate.
Dated: July 11, 2008.
James R. Hannon, Jr.,
Acting Chief, Operations, Directorate of Civil
Works.
[FR Doc. E8–16454 Filed 7–17–08; 8:45 am]
BILLING CODE 3710–92–P
POSTAL REGULATORY COMMISSION
39 CFR Part 3020
[Docket No. CP2008–7; Order No. 84]
Administrative Practice and
Procedure; Postal Service
Postal Regulatory Commission.
Direct final rule.
AGENCY:
ACTION:
SUMMARY: The Commission is adding
the Postal Service’s negotiated
agreement with China Post Group to the
competitive product list. This action is
consistent with changes in a recent law
governing postal operations. Republication of the lists of market
dominant and competitive products is
also consistent with new requirements
in the law.
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Federal Register / Vol. 73, No. 139 / Friday, July 18, 2008 / Rules and Regulations
Effective July 18, 2008. Related
Postal Service filings due July 23, 2008.
FOR FURTHER INFORMATION CONTACT:
Stephen L. Sharfman, General Counsel,
202–789–6820 or
stephen.sharfman@prc.gov.
DATES:
On May
20, 2008, the Postal Service filed notice,
pursuant to 39 U.S.C. 3632(b)(3) and 39
CFR 3015.5, of the Governors’ decision
establishing prices for competitive
products not of general applicability for
Inbound Express Mail International
(EMS).1 The Postal Service’s filing,
docketed as Docket No. CP2008–6,
includes supporting material, including
the Governors’ decision, filed under
seal. Concurrently, the Postal Service
filed notice, pursuant to 39 CFR 3015.5,
of a specific negotiated service
agreement covering Inbound EMS
prices.2 This filing, docketed as Docket
No. CP2008–7, includes the contract
and supporting materials filed under
seal.
On June 3, 2008, the Commission
issued Order No. 79, which determined
that Docket No. CP2008–6 establishes,
in essence, a shell classification, while
Docket No. CP2008–7 is a specific
agreement negotiated pursuant to the
conditions of the shell classification.
Given this interrelationship, the
Commission consolidated the
proceedings for purposes of review
under Docket No. CP2008–7.3
In Order No. 79, the Commission also
reiterated its position that each
negotiated service agreement will
initially be classified as a separate
product, while acknowledging the
possibility of grouping functionally
equivalent agreements as a single
product if they exhibit similar cost and
market characteristics. Id. at 2–3. This,
in effect, invoked the filing and review
requirements of 39 CFR part 3020,
subpart B, along with the requirements
of rule 3015.5 for competitive products.
On June 10, 2008, the Postal Service
filed material responsive to questions
posed in Order No. 79, and material
responsive to 39 CFR part 3020, subpart
B.4 The material responsive to 39 CFR
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SUPPLEMENTARY INFORMATION:
1 Notice of United States Postal Service of
Governors’ Decision on Inbound Prices Under
Express Mail International (EMS) Bilateral/
Multilateral Agreements, May 20, 2008 (Notice).
2 Notice of United States Postal Service of Filing
an Agreement for Inbound Express Mail
International (EMS) Prices, May 20, 2008 (Pricing
Notice).
3 PRC Order No. 79, Notice and Order Concerning
Prices Under Express Mail International Bilateral/
Multilateral Agreements, June 3, 2008 at 2 (Order
No. 79).
4 United States Postal Service Response to Order
No. 79 and Notice of Filing Information Responsive
to Part 3020 of the Commission’s Rules of Practice
VerDate Aug<31>2005
16:19 Jul 17, 2008
Jkt 214001
part 3020, subpart B included a
statement of supporting justification
sponsored by Pranab Shah. See Postal
Service Response, Attachment A.
The Commission previously
proposed, at a minimum, identifying
each international mail agreement with
foreign posts involving competitive
products (both in the Mail Classification
Schedule and in other documents
generated by the Commission) by the
name(s) of the foreign post(s), the mail
product(s) involved, and the
agreement’s expiration date. Order No.
79 at 3–4. In this instance, the Postal
Service did not object to this proposal.
Postal Service Response at 3.
The Commission also noted that it has
made no determination as to whether
the portions of the agreement in Docket
No. CP2008–7 that relate to outbound
mail are subject to its review. Order No.
79 at 3. The Postal Service reiterated its
position that an ‘‘outbound EMS
agreement with China Post Group
would no more need to be classified as
a product or otherwise subjected to
Commission review than would an
agreement to purchase trucking services
from highway contractors or to purchase
air transportation from air carriers.’’
Postal Service Response at 3.
Order No. 79 also provided an
opportunity for public comment on the
Postal Service’s proposals. Comments
were received from the Public
Representative (an employee of the
Commission assigned to represent the
interests of the general public) and
United Parcel Service.5 Neither the
Public Representative nor United Parcel
Service expressed opposition to the
China Post Group agreement.
The Public Representative concludes
that the China Post Group agreement
‘‘complies with the legal requirements
for cost coverage and contribution to the
Postal Service’s institutional costs.’’
Public Representative Comments at 4.
United Parcel Service supports the
Commission’s conclusion that this
initial agreement be treated as a new
product. UPS Comments at 2. It also
suggests that because private carriers
face more onerous customs and
brokerage requirements than the Postal
Service, the market for international
package delivery and expedited services
is less competitive than is often
and Procedure, June 10, 2008 (Postal Service
Response).
5 Public Representative Comments in Response to
United States Postal Service Notice of Negotiated
Service Agreement (NSA) for Inbound Express Mail
International (EMS) with China Post (Public
Representative Comments); Comments of United
Parcel Service in Response to Order Concerning
Prices Under Express Mail International Bilateral/
Multilateral Agreements (UPS Comments); both
filed June 16, 2008.
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assumed. Id. Both the Public
Representative and United Parcel
Service discuss issues encompassing the
provision of materials under seal. Public
Representative Comments at 2–3; UPS
Comments at 1.
Commission analysis. The statutory
responsibility of the Commission, in
this instance, is to assign a new product
to either the market dominant list or the
competitive product list. 39 U.S.C. 3642.
As part of this responsibility, the
Commission also will preliminarily
review the proposal for compliance with
the requirements of the Postal
Accountability and Enhancement Act
(PAEA) of 2006. For proposed
competitive products, this includes
review of the provisions applicable to
rates for competitive products. 39 U.S.C.
3633.
The Postal Service contends that
adding the shell classification as a
product will improve the Postal
Service’s competitive posture. It argues
that this can be accomplished while
allowing verification that each
agreement covers attributable costs,
does not result in subsidization of
competitive products by market
dominant products, and increases
contribution from competitive products.
Alternatively, adding the individual
agreement as a product also will
improve the competitive posture of the
Postal Service, but to a lesser degree.
Postal Service Response, Attachment A,
at 2.
The Commission has reviewed the
financial analysis provided under seal
that accompanies the agreement and
finds that the China Post Group
agreement should cover its attributable
costs (39 U.S.C. 3633(a)(2)), should not
lead to the subsidization of competitive
products by market dominant products
(39 U.S.C. 3633(a)(1)), and should have
a positive effect on the collective
competitive products ability to provide
their appropriate share of institutional
costs (39 U.S.C. 3633(a)(3)).6 Thus, a
preliminary review of the agreement
indicates that it comports with the
6 The Commission notes that the Postal Service
derived inflation adjustment factors from two point
estimates for a 21-month period, September 2007 to
May 2009, rather than June 2008 to May 2009,
which coincides with the duration of the bilateral
agreement. The Commission also notes that the
estimate of the total unit cost of inbound Express
Mail from China Post Group is based upon an
estimate of the unit cost of domestic mail
processing that represents an average of the
domestic mail processing cost of inbound Express
Mail from all countries rather than the average unit
domestic mail processing cost for transition system
countries. These observations did not have a
significant impact on the overall analysis; however,
the rationale for a 21-month period and the use of
an average should be explained when filing future
similar agreements.
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Federal Register / Vol. 73, No. 139 / Friday, July 18, 2008 / Rules and Regulations
provisions applicable to rates for
competitive products. In determining
whether to assign the China Post Group
agreement as a product to the market
dominant product list or the
competitive product list the
Commission must consider whether:
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* * * the Postal Service exercises sufficient
market power that it can effectively set the
price of such product substantially above
costs, raise prices significantly, decrease
quality, or decrease output, without risk of
losing a significant level of business to other
firms offering similar products.
39 U.S.C. 3642(b)(1). If this is the case,
the product will be categorized as
market dominant. The competitive
category of products shall consist of all
other products.
The Commission is further required to
consider the availability and nature of
enterprises in the private sector engaged
in the delivery of the product, the views
of those that use the product, and the
likely impact on small business
concerns. 39 U.S.C. 3642(b)(3).
The Postal Service asserts that its
bargaining position is constrained by
the existence of other shippers who can
provide similar services. Thus, the
market precludes the Postal Service
from taking unilateral action to increase
prices or decrease service without the
risk of losing volume to private
companies in the international shipping
industry. Postal Service Response,
Attachment A, at 2–3. The Postal
Service contends that private
consolidators and freight forwarders
may offer international arrangements
under similar conditions. Id. at 3. The
Postal Service has no specific data on
the views of those that use the products
on the regulatory classification. Id. at 4.
Finally, the Postal Service states that
large shippers serve the market under
consideration, and that there should be
little impact upon small business other
than adding an additional option for
shipping articles to the United States.
Id.
The Commission previously assigned
Inbound International Expedited
Services to the competitive product
list.7 The Postal Service contends that
the China Post Group agreement falls
within the Inbound International
Expedited Services heading. The
Commission has not received public
opposition to the proposed regulatory
classification during the comment
period. Having considered the statutory
requirements, the argument put forth by
the Postal Service, and the public
comment, the Commission finds that the
7 PRC Order No. 43, Order Establishing
Ratemaking Regulations for Market Dominant and
Competitive Products, October 29, 2008, para. 3019.
VerDate Aug<31>2005
16:19 Jul 17, 2008
Jkt 214001
China Post Group agreement is
appropriately categorized as a
competitive product and should be
added to the competitive product list.
The revisions to the competitive
product list are shown below the
signature of this order, and shall become
effective upon publication in the
Federal Register.
Mail Classification Schedule. The
Postal Service previously proposed
applicable draft Mail Classification
Schedule language governing Inbound
Express Mail International Services
(EMS).8 Attachment A to the Governors’
decision filed in Docket No. CP2008–6
repeats this language. These proposals
suggest assigning the China Post Group
agreement to the Express Mail, Inbound
Express Mail International category. In
Docket Nos. CP2008–4, CP2008–5,
CP2008–8, CP2008–9, and CP2008–10,
the Postal Service’s draft Mail
Classification Schedule language
proposes to assign the associated
agreements to the Negotiated Service
Agreements, Outbound International
category. The intent of the overall
Negotiated Service Agreements category
is to organize all negotiated agreements.
Thus, the categorization in the instant
docket does not appear to be consistent
with the other proposals. The
Commission invites the Postal Service
to share its thoughts and concerns on
development of a consistent approach to
organizing competitive product
negotiated agreements within the Mail
Classification Schedule.
The Postal Service’s proposed Mail
Classification Schedule language
indicates that other negotiated
agreements may exist within Inbound
Express Mail International: Bilateral
Express Mail Service (EMS); EMS
Cooperative Pay for Performance;
Kahala Posts Group; European Parcel
Group; and China Post Group. The
Commission does not have specific
information on the negotiated
agreements for these products. The
Postal Service shall provide the
Commission with a list of ongoing
agreement names, and expiration dates
separated by product, along with a copy
of each agreement.9 Providing this
information will aid the Commission in
understanding the Postal Service’s
product offerings, and enhance the
transparency of the Postal Service to the
mailing community.
8 See United States Postal Service Submission of
Additional Mail Classification Schedule
Information in Response to Order No. 43, November
20, 2007.
9 See 39 U.S.C. 407(d)(2). Agreements that fall
outside of the defined product models also are to
be provided.
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41267
Updating the Mail Classification
Schedule. The China Post Group
agreement contains provisions for early
termination and automatic renewal of
the agreement. The Postal Service shall
notify the Commission of an early
termination no later than the date of
termination. The Commission then will
remove the agreement from the Mail
Classification Schedule at the earliest
possible opportunity. The Postal Service
also shall notify the Commission of an
automatic renewal of the agreement 15
days prior its occurrence. Otherwise, the
Commission will assume that the
contract has lapsed and remove the
agreement from the Mail Classification
Schedule without notice.
Additional agreements. As of now,
the China Post Group agreement
represented by Inbound International
Expedited Services 1 (CP2008–7) in the
competitive product list may be
considered the same entity. In the
future, the Postal Service may enter into
other agreements substantially similar to
the China Post Group agreement. When
this occurs, Inbound International
Expedited Services 1 (CP2008–7) will be
considered the product and the
included individual agreements will be
treated as price categories under the
product.10
If the Postal Service determines that it
has entered into an agreement
substantially equivalent to the China
Post Group agreement with another
country, it may file such an agreement
using the abbreviated requirements
provided by rule 3015.5. In each case,
the individual agreement must be filed
with the Commission, and each
agreement must meet the requirements
of 39 U.S.C. 3633. The Postal Service
shall identify all significant differences
between the new agreement and the preexisting product group. Such differences
would include terms and conditions
that impose new obligations or new
requirements on any party to the
agreement. The Commission will verify
whether or not the second agreement is
in fact substantially equivalent.
Agreements that are not substantially
equivalent will continue to have to meet
the filing requirements provided by 39
CFR part 3020, subpart B. If this
approach proves too cumbersome,
alternative approaches may be
considered.
Confidentiality of information. The
Commission is aware that the treatment
of information as confidential is a
sensitive issue. The Postal Service, the
Public Representative, and United
Parcel Service all express valid concerns
10 This may require future modification of the
China Post Group descriptive language.
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Federal Register / Vol. 73, No. 139 / Friday, July 18, 2008 / Rules and Regulations
that the Commission will address in the
future on a broader level.
In this docket, the Commission will
take a limited first step to add
transparency and facilitate the process
of reviewing future agreements of this
style. The Commission has reviewed the
Governor’s decision supporting the
request provided as required by rule
3020.31(b), and has determined that
most of the document does not pose a
risk of competitive harm if disclosed. In
fact, the Postal Service disclosed similar
information associated with Docket Nos.
CP2008–8, CP2008–9, and CP2008–10.
The Postal Service is directed to file a
redacted version of the Governor’s
decision provided under seal in Docket
No. CP2008–6.11
It is Ordered:
1. The China Post Group agreement is
added as a product not of general
applicability to the competitive product
list under Inbound International
Expedited Services as Inbound
International Expedited Services 1
(CP2008–7).
2. The Postal Service shall provide the
Commission with suggestions regarding
the development of a consistent
approach to organizing competitive
product negotiated agreements within
the Mail Classification Schedule by July
23, 2008.
3. The Postal Service shall file with
the Commission a list of all ongoing
Inbound International Expedited
Services agreements and expiration
dates separated by product, along with
a copy of each agreement, by July 23,
2008.
4. The Postal Service shall file with
the Commission a redacted version of
the Governors’ decision provided under
seal in Docket No. CP2008–6 by July 23,
2008.
5. The Secretary shall arrange for
publication of this order in the Federal
Register.
By the Commission.
Issued: June 27, 2008.
Steven W. Williams,
Secretary.
List of Subjects in 39 CFR Part 3020
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Administrative practice and
procedure; Postal Service.
I For the reasons stated in the preamble,
under the authority at 39 U.S.C. 503, the
Postal Regulatory Commission amends
39 CFR part 3020 as follows:
11 The redacted version should be filed under
Docket No. MC2008–7. The Commission anticipates
the redacted version will be similar in nature to
what the Postal Service provided associated with
Docket Nos. CP2008–8, CP2008–9, and CP2008–10
on June 16, 2008.
VerDate Aug<31>2005
16:19 Jul 17, 2008
Jkt 214001
1. The authority citation for part 3020
continues to read as follows:
I
Authority: 39 U.S.C. 503; 3622; 3631; 3642;
3682.
2. In Appendix A to Subpart A of Part
3020 revise sections 1000 and 2000 to
read as follows:
I
Appendix A to Subpart A of Part
3020—Mail Classification Schedule
Part A—Market Dominant Products
1000 Market Dominant Product List
First-Class Mail
Single-piece Letters/Postcards
Bulk Letters/Postcards
Flats
Parcels
Outbound Single-Piece First-Class Mail
International
Inbound Single-Piece First-Class Mail
International
Standard Mail (Regular and Nonprofit)
High Density and Saturation Letters
High Density and Saturation Flats/Parcels
Carrier Route
Letters
Flats
Not Flat-Machinables (NFMs)/Parcels
Periodicals
Within County Periodicals
Outside County Periodicals
Package Services
Single-Piece Parcel Post
Inbound Surface Parcel Post (at UPU rates)
Bound Printed Matter Flats
Bound Printed Matter Parcels
Media Mail/Library Mail
Special Services
Ancillary Services
International Ancillary Services
Address List Services
Caller Service
Change-of-Address Credit Card
Authentication
Confirm
International Reply Coupon Service
International Business Reply Mail Service
Money Orders
Post Office Box Service
Premium Forwarding Service (Experiment)
Negotiated Service Agreements
Discover Financial Services Negotiated
Service Agreement
Bank One Negotiated Service Agreement
HSBC North America Holdings Inc.
Negotiated Service Agreement
Bookspan Negotiated Service Agreement
1001 Market Dominant Product
Descriptions
*
*
*
*
*
Part B—Competitive Products
2000 Competitive Product List
Express Mail
Express Mail
Outbound International Expedited Services
Inbound International Expedited Services
Inbound International Expedited Services 1
(CP2008–7)
Priority Mail
Priority Mail
Outbound Priority Mail International
Inbound Air Parcel Post
Parcel Select
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Parcel Return Service
International
International Priority Airlift (IPA)
International Surface Airlift (ISAL)
International Direct Sacks—M-Bags
Global Customized Shipping Services
Inbound Surface Parcel Post (at non-UPU
rates)
International Money Transfer Service
International Ancillary Services
Negotiated Service Agreements
Domestic
Outbound International
*
*
*
*
*
[FR Doc. E8–16031 Filed 7–17–08; 8:45 am]
BILLING CODE 7710–FW–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 52
[EPA–R03–OAR–2007–1120; FRL–8693–5]
Approval and Promulgation of Air
Quality Implementation Plans;
Maryland; Reasonably Available
Control Technology Requirements for
Marine Vessel and Barge Loading
Environmental Protection
Agency (EPA).
ACTION: Final rule.
AGENCY:
SUMMARY: EPA is approving a State
Implementation Plan (SIP) revision
submitted by the State of Maryland.
This revision establishes and requires
reasonably available control technology
(RACT) for the control of volatile
organic compound (VOC) emissions
from marine vessel and barge loading.
EPA is approving this SIP revision in
accordance with the Clean Air Act
(CAA).
DATES: Effective Date: This final rule is
effective on August 18, 2008.
ADDRESSES: EPA has established a
docket for this action under Docket ID
Number EPA–R03–OAR–2007–1120. All
documents in the docket are listed in
the https://www.regulations.gov Web
site. Although listed in the electronic
docket, some information is not publicly
available, i.e., confidential business
information (CBI) or other information
whose disclosure is restricted by statute.
Certain other material, such as
copyrighted material, is not placed on
the Internet and will be publicly
available only in hard copy form.
Publicly available docket materials are
available either electronically through
https://www.regulations.gov or in hard
copy for public inspection during
normal business hours at the Air
Protection Division, U.S. Environmental
Protection Agency, Region III, 1650
Arch Street, Philadelphia, Pennsylvania
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]]>Agencies
[Federal Register Volume 73, Number 139 (Friday, July 18, 2008)]
[Rules and Regulations]
[Pages 41265-41268]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-16031]
=======================================================================
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POSTAL REGULATORY COMMISSION
39 CFR Part 3020
[Docket No. CP2008-7; Order No. 84]
Administrative Practice and Procedure; Postal Service
AGENCY: Postal Regulatory Commission.
ACTION: Direct final rule.
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SUMMARY: The Commission is adding the Postal Service's negotiated
agreement with China Post Group to the competitive product list. This
action is consistent with changes in a recent law governing postal
operations. Re-publication of the lists of market dominant and
competitive products is also consistent with new requirements in the
law.
[[Page 41266]]
DATES: Effective July 18, 2008. Related Postal Service filings due July
23, 2008.
FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel,
202-789-6820 or stephen.sharfman@prc.gov.
SUPPLEMENTARY INFORMATION: On May 20, 2008, the Postal Service filed
notice, pursuant to 39 U.S.C. 3632(b)(3) and 39 CFR 3015.5, of the
Governors' decision establishing prices for competitive products not of
general applicability for Inbound Express Mail International (EMS).\1\
The Postal Service's filing, docketed as Docket No. CP2008-6, includes
supporting material, including the Governors' decision, filed under
seal. Concurrently, the Postal Service filed notice, pursuant to 39 CFR
3015.5, of a specific negotiated service agreement covering Inbound EMS
prices.\2\ This filing, docketed as Docket No. CP2008-7, includes the
contract and supporting materials filed under seal.
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\1\ Notice of United States Postal Service of Governors'
Decision on Inbound Prices Under Express Mail International (EMS)
Bilateral/Multilateral Agreements, May 20, 2008 (Notice).
\2\ Notice of United States Postal Service of Filing an
Agreement for Inbound Express Mail International (EMS) Prices, May
20, 2008 (Pricing Notice).
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On June 3, 2008, the Commission issued Order No. 79, which
determined that Docket No. CP2008-6 establishes, in essence, a shell
classification, while Docket No. CP2008-7 is a specific agreement
negotiated pursuant to the conditions of the shell classification.
Given this interrelationship, the Commission consolidated the
proceedings for purposes of review under Docket No. CP2008-7.\3\
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\3\ PRC Order No. 79, Notice and Order Concerning Prices Under
Express Mail International Bilateral/Multilateral Agreements, June
3, 2008 at 2 (Order No. 79).
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In Order No. 79, the Commission also reiterated its position that
each negotiated service agreement will initially be classified as a
separate product, while acknowledging the possibility of grouping
functionally equivalent agreements as a single product if they exhibit
similar cost and market characteristics. Id. at 2-3. This, in effect,
invoked the filing and review requirements of 39 CFR part 3020, subpart
B, along with the requirements of rule 3015.5 for competitive products.
On June 10, 2008, the Postal Service filed material responsive to
questions posed in Order No. 79, and material responsive to 39 CFR part
3020, subpart B.\4\ The material responsive to 39 CFR part 3020,
subpart B included a statement of supporting justification sponsored by
Pranab Shah. See Postal Service Response, Attachment A.
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\4\ United States Postal Service Response to Order No. 79 and
Notice of Filing Information Responsive to Part 3020 of the
Commission's Rules of Practice and Procedure, June 10, 2008 (Postal
Service Response).
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The Commission previously proposed, at a minimum, identifying each
international mail agreement with foreign posts involving competitive
products (both in the Mail Classification Schedule and in other
documents generated by the Commission) by the name(s) of the foreign
post(s), the mail product(s) involved, and the agreement's expiration
date. Order No. 79 at 3-4. In this instance, the Postal Service did not
object to this proposal. Postal Service Response at 3.
The Commission also noted that it has made no determination as to
whether the portions of the agreement in Docket No. CP2008-7 that
relate to outbound mail are subject to its review. Order No. 79 at 3.
The Postal Service reiterated its position that an ``outbound EMS
agreement with China Post Group would no more need to be classified as
a product or otherwise subjected to Commission review than would an
agreement to purchase trucking services from highway contractors or to
purchase air transportation from air carriers.'' Postal Service
Response at 3.
Order No. 79 also provided an opportunity for public comment on the
Postal Service's proposals. Comments were received from the Public
Representative (an employee of the Commission assigned to represent the
interests of the general public) and United Parcel Service.\5\ Neither
the Public Representative nor United Parcel Service expressed
opposition to the China Post Group agreement.
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\5\ Public Representative Comments in Response to United States
Postal Service Notice of Negotiated Service Agreement (NSA) for
Inbound Express Mail International (EMS) with China Post (Public
Representative Comments); Comments of United Parcel Service in
Response to Order Concerning Prices Under Express Mail International
Bilateral/Multilateral Agreements (UPS Comments); both filed June
16, 2008.
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The Public Representative concludes that the China Post Group
agreement ``complies with the legal requirements for cost coverage and
contribution to the Postal Service's institutional costs.'' Public
Representative Comments at 4. United Parcel Service supports the
Commission's conclusion that this initial agreement be treated as a new
product. UPS Comments at 2. It also suggests that because private
carriers face more onerous customs and brokerage requirements than the
Postal Service, the market for international package delivery and
expedited services is less competitive than is often assumed. Id. Both
the Public Representative and United Parcel Service discuss issues
encompassing the provision of materials under seal. Public
Representative Comments at 2-3; UPS Comments at 1.
Commission analysis. The statutory responsibility of the
Commission, in this instance, is to assign a new product to either the
market dominant list or the competitive product list. 39 U.S.C. 3642.
As part of this responsibility, the Commission also will preliminarily
review the proposal for compliance with the requirements of the Postal
Accountability and Enhancement Act (PAEA) of 2006. For proposed
competitive products, this includes review of the provisions applicable
to rates for competitive products. 39 U.S.C. 3633.
The Postal Service contends that adding the shell classification as
a product will improve the Postal Service's competitive posture. It
argues that this can be accomplished while allowing verification that
each agreement covers attributable costs, does not result in
subsidization of competitive products by market dominant products, and
increases contribution from competitive products. Alternatively, adding
the individual agreement as a product also will improve the competitive
posture of the Postal Service, but to a lesser degree. Postal Service
Response, Attachment A, at 2.
The Commission has reviewed the financial analysis provided under
seal that accompanies the agreement and finds that the China Post Group
agreement should cover its attributable costs (39 U.S.C. 3633(a)(2)),
should not lead to the subsidization of competitive products by market
dominant products (39 U.S.C. 3633(a)(1)), and should have a positive
effect on the collective competitive products ability to provide their
appropriate share of institutional costs (39 U.S.C. 3633(a)(3)).\6\
Thus, a preliminary review of the agreement indicates that it comports
with the
[[Page 41267]]
provisions applicable to rates for competitive products. In determining
whether to assign the China Post Group agreement as a product to the
market dominant product list or the competitive product list the
Commission must consider whether:
\6\ The Commission notes that the Postal Service derived
inflation adjustment factors from two point estimates for a 21-month
period, September 2007 to May 2009, rather than June 2008 to May
2009, which coincides with the duration of the bilateral agreement.
The Commission also notes that the estimate of the total unit cost
of inbound Express Mail from China Post Group is based upon an
estimate of the unit cost of domestic mail processing that
represents an average of the domestic mail processing cost of
inbound Express Mail from all countries rather than the average unit
domestic mail processing cost for transition system countries. These
observations did not have a significant impact on the overall
analysis; however, the rationale for a 21-month period and the use
of an average should be explained when filing future similar
agreements.
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* * * the Postal Service exercises sufficient market power that it
can effectively set the price of such product substantially above
costs, raise prices significantly, decrease quality, or decrease
output, without risk of losing a significant level of business to
other firms offering similar products.
39 U.S.C. 3642(b)(1). If this is the case, the product will be
categorized as market dominant. The competitive category of products
shall consist of all other products.
The Commission is further required to consider the availability and
nature of enterprises in the private sector engaged in the delivery of
the product, the views of those that use the product, and the likely
impact on small business concerns. 39 U.S.C. 3642(b)(3).
The Postal Service asserts that its bargaining position is
constrained by the existence of other shippers who can provide similar
services. Thus, the market precludes the Postal Service from taking
unilateral action to increase prices or decrease service without the
risk of losing volume to private companies in the international
shipping industry. Postal Service Response, Attachment A, at 2-3. The
Postal Service contends that private consolidators and freight
forwarders may offer international arrangements under similar
conditions. Id. at 3. The Postal Service has no specific data on the
views of those that use the products on the regulatory classification.
Id. at 4. Finally, the Postal Service states that large shippers serve
the market under consideration, and that there should be little impact
upon small business other than adding an additional option for shipping
articles to the United States. Id.
The Commission previously assigned Inbound International Expedited
Services to the competitive product list.\7\ The Postal Service
contends that the China Post Group agreement falls within the Inbound
International Expedited Services heading. The Commission has not
received public opposition to the proposed regulatory classification
during the comment period. Having considered the statutory
requirements, the argument put forth by the Postal Service, and the
public comment, the Commission finds that the China Post Group
agreement is appropriately categorized as a competitive product and
should be added to the competitive product list. The revisions to the
competitive product list are shown below the signature of this order,
and shall become effective upon publication in the Federal Register.
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\7\ PRC Order No. 43, Order Establishing Ratemaking Regulations
for Market Dominant and Competitive Products, October 29, 2008,
para. 3019.
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Mail Classification Schedule. The Postal Service previously
proposed applicable draft Mail Classification Schedule language
governing Inbound Express Mail International Services (EMS).\8\
Attachment A to the Governors' decision filed in Docket No. CP2008-6
repeats this language. These proposals suggest assigning the China Post
Group agreement to the Express Mail, Inbound Express Mail International
category. In Docket Nos. CP2008-4, CP2008-5, CP2008-8, CP2008-9, and
CP2008-10, the Postal Service's draft Mail Classification Schedule
language proposes to assign the associated agreements to the Negotiated
Service Agreements, Outbound International category. The intent of the
overall Negotiated Service Agreements category is to organize all
negotiated agreements. Thus, the categorization in the instant docket
does not appear to be consistent with the other proposals. The
Commission invites the Postal Service to share its thoughts and
concerns on development of a consistent approach to organizing
competitive product negotiated agreements within the Mail
Classification Schedule.
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\8\ See United States Postal Service Submission of Additional
Mail Classification Schedule Information in Response to Order No.
43, November 20, 2007.
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The Postal Service's proposed Mail Classification Schedule language
indicates that other negotiated agreements may exist within Inbound
Express Mail International: Bilateral Express Mail Service (EMS); EMS
Cooperative Pay for Performance; Kahala Posts Group; European Parcel
Group; and China Post Group. The Commission does not have specific
information on the negotiated agreements for these products. The Postal
Service shall provide the Commission with a list of ongoing agreement
names, and expiration dates separated by product, along with a copy of
each agreement.\9\ Providing this information will aid the Commission
in understanding the Postal Service's product offerings, and enhance
the transparency of the Postal Service to the mailing community.
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\9\ See 39 U.S.C. 407(d)(2). Agreements that fall outside of the
defined product models also are to be provided.
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Updating the Mail Classification Schedule. The China Post Group
agreement contains provisions for early termination and automatic
renewal of the agreement. The Postal Service shall notify the
Commission of an early termination no later than the date of
termination. The Commission then will remove the agreement from the
Mail Classification Schedule at the earliest possible opportunity. The
Postal Service also shall notify the Commission of an automatic renewal
of the agreement 15 days prior its occurrence. Otherwise, the
Commission will assume that the contract has lapsed and remove the
agreement from the Mail Classification Schedule without notice.
Additional agreements. As of now, the China Post Group agreement
represented by Inbound International Expedited Services 1 (CP2008-7) in
the competitive product list may be considered the same entity. In the
future, the Postal Service may enter into other agreements
substantially similar to the China Post Group agreement. When this
occurs, Inbound International Expedited Services 1 (CP2008-7) will be
considered the product and the included individual agreements will be
treated as price categories under the product.\10\
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\10\ This may require future modification of the China Post
Group descriptive language.
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If the Postal Service determines that it has entered into an
agreement substantially equivalent to the China Post Group agreement
with another country, it may file such an agreement using the
abbreviated requirements provided by rule 3015.5. In each case, the
individual agreement must be filed with the Commission, and each
agreement must meet the requirements of 39 U.S.C. 3633. The Postal
Service shall identify all significant differences between the new
agreement and the pre-existing product group. Such differences would
include terms and conditions that impose new obligations or new
requirements on any party to the agreement. The Commission will verify
whether or not the second agreement is in fact substantially
equivalent. Agreements that are not substantially equivalent will
continue to have to meet the filing requirements provided by 39 CFR
part 3020, subpart B. If this approach proves too cumbersome,
alternative approaches may be considered.
Confidentiality of information. The Commission is aware that the
treatment of information as confidential is a sensitive issue. The
Postal Service, the Public Representative, and United Parcel Service
all express valid concerns
[[Page 41268]]
that the Commission will address in the future on a broader level.
In this docket, the Commission will take a limited first step to
add transparency and facilitate the process of reviewing future
agreements of this style. The Commission has reviewed the Governor's
decision supporting the request provided as required by rule
3020.31(b), and has determined that most of the document does not pose
a risk of competitive harm if disclosed. In fact, the Postal Service
disclosed similar information associated with Docket Nos. CP2008-8,
CP2008-9, and CP2008-10. The Postal Service is directed to file a
redacted version of the Governor's decision provided under seal in
Docket No. CP2008-6.\11\
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\11\ The redacted version should be filed under Docket No.
MC2008-7. The Commission anticipates the redacted version will be
similar in nature to what the Postal Service provided associated
with Docket Nos. CP2008-8, CP2008-9, and CP2008-10 on June 16, 2008.
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It is Ordered:
1. The China Post Group agreement is added as a product not of
general applicability to the competitive product list under Inbound
International Expedited Services as Inbound International Expedited
Services 1 (CP2008-7).
2. The Postal Service shall provide the Commission with suggestions
regarding the development of a consistent approach to organizing
competitive product negotiated agreements within the Mail
Classification Schedule by July 23, 2008.
3. The Postal Service shall file with the Commission a list of all
ongoing Inbound International Expedited Services agreements and
expiration dates separated by product, along with a copy of each
agreement, by July 23, 2008.
4. The Postal Service shall file with the Commission a redacted
version of the Governors' decision provided under seal in Docket No.
CP2008-6 by July 23, 2008.
5. The Secretary shall arrange for publication of this order in the
Federal Register.
By the Commission.
Issued: June 27, 2008.
Steven W. Williams,
Secretary.
List of Subjects in 39 CFR Part 3020
Administrative practice and procedure; Postal Service.
0
For the reasons stated in the preamble, under the authority at 39
U.S.C. 503, the Postal Regulatory Commission amends 39 CFR part 3020 as
follows:
0
1. The authority citation for part 3020 continues to read as follows:
Authority: 39 U.S.C. 503; 3622; 3631; 3642; 3682.
0
2. In Appendix A to Subpart A of Part 3020 revise sections 1000 and
2000 to read as follows:
Appendix A to Subpart A of Part 3020--Mail Classification Schedule
Part A--Market Dominant Products
1000 Market Dominant Product List
First-Class Mail
Single-piece Letters/Postcards
Bulk Letters/Postcards
Flats
Parcels
Outbound Single-Piece First-Class Mail International
Inbound Single-Piece First-Class Mail International
Standard Mail (Regular and Nonprofit)
High Density and Saturation Letters
High Density and Saturation Flats/Parcels
Carrier Route
Letters
Flats
Not Flat-Machinables (NFMs)/Parcels
Periodicals
Within County Periodicals
Outside County Periodicals
Package Services
Single-Piece Parcel Post
Inbound Surface Parcel Post (at UPU rates)
Bound Printed Matter Flats
Bound Printed Matter Parcels
Media Mail/Library Mail
Special Services
Ancillary Services
International Ancillary Services
Address List Services
Caller Service
Change-of-Address Credit Card Authentication
Confirm
International Reply Coupon Service
International Business Reply Mail Service
Money Orders
Post Office Box Service
Premium Forwarding Service (Experiment)
Negotiated Service Agreements
Discover Financial Services Negotiated Service Agreement
Bank One Negotiated Service Agreement
HSBC North America Holdings Inc. Negotiated Service Agreement
Bookspan Negotiated Service Agreement
1001 Market Dominant Product Descriptions
* * * * *
Part B--Competitive Products
2000 Competitive Product List
Express Mail
Express Mail
Outbound International Expedited Services
Inbound International Expedited Services
Inbound International Expedited Services 1 (CP2008-7)
Priority Mail
Priority Mail
Outbound Priority Mail International
Inbound Air Parcel Post
Parcel Select
Parcel Return Service
International
International Priority Airlift (IPA)
International Surface Airlift (ISAL)
International Direct Sacks--M-Bags
Global Customized Shipping Services
Inbound Surface Parcel Post (at non-UPU rates)
International Money Transfer Service
International Ancillary Services
Negotiated Service Agreements
Domestic
Outbound International
* * * * *
[FR Doc. E8-16031 Filed 7-17-08; 8:45 am]
BILLING CODE 7710-FW-P
