Procedures Related to Commission Views, 869-878 [2016-36]

Agencies

• POSTAL REGULATORY COMMISSION

[Federal Register Volume 81, Number 5 (Friday, January 8, 2016)]
[Rules and Regulations]
[Pages 869-878]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-36]


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POSTAL REGULATORY COMMISSION

39 CFR Part 3017

[Docket No. RM2015-14; Order No. 2960]


Procedures Related to Commission Views

AGENCY: Postal Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Commission is issuing a set of final rules establishing 
the Commission's process for developing views to the Secretary of State 
on certain international mail matters pursuant to 39 U.S.C. 407(c)(1). 
Relative to the proposed rules, the changes are minor in nature.

DATES: Effective: February 8, 2016.

FOR FURTHER INFORMATION CONTACT: David A. Trissell, General Counsel, at 
202-789-6820.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Introduction
II. Rulemaking Context
III. Summary of Proposed Rules
IV. Review and Analysis of Comments
V. Ordering Paragraphs

I. Introduction

    On July 21, 2015, the Commission issued proposed rules describing 
general procedures related to the development of the Commission's views 
on certain international mail matters pursuant to 39 U.S.C. 
407(c)(1).\1\ For the reasons discussed below, the Commission adopts 
final rules on this topic. The final rules reflect several minor 
revisions to the proposed rules.
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    \1\ Notice of Proposed Rulemaking, July 21, 2015 (Order No. 
2602).
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II. Rulemaking Context

    In addition to revising the longstanding approach to establishing 
domestic mail rates and classifications, the Postal Accountability and 
Enhancement Act (PAEA) of 2006 amended several statutory provisions 
concerning international mail matters.\2\ One of these amendments 
directs the Secretary of State, prior to concluding a treaty, 
convention, or amendment establishing a market dominant rate or 
classification, to request the Commission's views on the consistency of 
such rate or classification with the standards and criteria established 
by the Commission under 39 U.S.C. 3622. 39 U.S.C. 407(c)(1). Section 
3622 concerns the establishment of a modern system for regulating rates 
and classes for market dominant products.
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    \2\ See Postal Accountability and Enhancement Act, Public Law 
109-435, 120 Stat. 3198 (2006), section 405(a) (PAEA).
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    A companion provision requires the Secretary of State to ensure 
that each treaty, convention, or amendment concluded under section 
407(b) is consistent with the Commission's views unless the Secretary 
makes a written determination that ensuring such consistency is not in 
the Nation's foreign policy or national security interest. 39 U.S.C. 
407(c)(2). Such a written determination must be provided to the 
Commission, along with a full explanation of the reasons, but portions 
of the determination may be designated confidential for reasons of 
foreign policy or national security. Id.
    The introduction of a formal advisory role for the Commission in 
this area was a significant change from previous law, as previous law 
did not require the Secretary of State to request the Commission's 
views in carrying out the Secretary's responsibilities.\3\ 
Notwithstanding a degree of shared responsibility, the PAEA makes clear 
that the Secretary of State exercises primary authority for the conduct 
of foreign policy with respect to international postal services and 
other international delivery services, including the determination of 
U.S. positions and the conduct of U.S. participation in negotiations 
with foreign governments and international bodies. See 39 U.S.C. 
407(b)(2).
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    \3\ See 39 U.S.C. 407(d) (1998), amended by the PAEA.
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    Pursuant to the directive in section 407(c)(1), the Secretary of 
State requested--and the Commission provided--views on certain 
proposals submitted for consideration at the quadrennial Universal 
Postal Union (UPU) Congresses \4\ held in 2008 and 2012, which occurred 
after enactment of the PAEA. In anticipation of preparing views in 
connection with the 2012 Congress, the Commission established Docket 
No. PI2012-1 to receive written comments from the public on the 
principles that should guide the development of its views.\5\ The 
Commission closed Docket No. PI2012-1 on January 29, 2015.\6\
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    \4\ The UPU Congress is the plenipotentiary body of this 
international organization that has the authority to amend the UPU 
Acts. These Acts include the UPU Constitution, General Regulations, 
Rules of Procedure, and Postal Payment Services Agreement.
    \5\ Docket No. PI2012-1, Order No. 1420, Notice Providing 
Opportunity to Comment on Development of Commission Views pursuant 
to 39 U.S.C. 407(c)(1), July 31, 2012. The next UPU Congress is 
tentatively scheduled to convene in mid-September 2016 in Istanbul, 
Turkey.
    \6\ Docket No. PI2012-1, Order No. 2335, Order Closing Docket, 
January 29, 2015, at 1.
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III. Summary of Proposed Rules

    The proposed rules describe general procedures associated with the 
development of the Commission's views on certain proposals submitted 
for consideration at UPU Congresses and related meetings. They are 
patterned on the approach followed in Docket No.

[[Page 870]]

PI2012-1 with several adjustments to reflect the Commission's 
experience in that docket.
    The proposed rules establish a docket for each UPU Congress and 
related meetings to serve as an administrative mechanism for soliciting 
and receiving public comments and posting related notices and 
documents. Each docket will be established on or about 150 days before 
the date a UPU Congress is scheduled to convene. As in Docket No. 
PI2012-1, the Commission will seek comments on the general principles 
that should guide the Commission in the formation of its views. The 
proposed rules also allow comments on specific proposals to the extent 
such proposals are publicly available. Comment deadlines will be 
established on a case-by-case basis and based on the Commission's 
assessment of how much time can be allowed, consistent with timely 
submission of its views to the Secretary of State.

IV. Review and Analysis of Comments

A. Overview

    The Commission received initial comments from Joyce Dillard, 
Federal Express Corporation (FedEx), the Public Representative, and the 
Postal Service.\7\ The Commission received reply comments from FedEx, 
United Parcel Service (UPS), the Public Representative, and the Postal 
Service.\8\ Commenters generally support issuance of rules on 
procedures for administering certain view-related matters, but seek 
clarification of, and revisions relating to:
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    \7\ Comments Received from Joyce Dillard, August 28, 2015 
(Dillard Comments); Comments of Federal Express Corporation, August 
27, 2015 (FedEx Comments); Comments of the Public Representative, 
August 27, 2015 (PR Comments); and United States Postal Service 
Comments on Procedures Related to Commission Views, August 27, 2015 
(Postal Service Comments).
    \8\ Reply Comments of Federal Express Corporation, September 11, 
2015 (FedEx Reply Comments); Reply Comments of United Parcel Service 
on the Proposed Rule to Adopt Procedures Related to the Commission's 
Views on International Postal Agreements, September 11, 2015 (UPS 
Reply Comments); Errata Notice of United Parcel Service, September 
14, 2015; and Reply Comments of United Parcel Service on the 
Proposed Rule to Adopt Procedures Related to the Commission's Views 
on International Postal Agreements (Corrected and Refiled), 
September 14, 2015 (Corrected UPS Reply Comments); Reply Comments of 
the Public Representative, September 11, 2015 (PR Reply Comments); 
and United States Postal Service Reply Comments on Procedures 
Related to Commission Views, September 11, 2015 (Postal Service 
Reply Comments).
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     The applicability of Administrative Procedure Act (APA) 
procedural requirements to views;
     the scope of comments and scope of Commission views, 
particularly with regard to the proposed definition of modern market 
regulation;
     several other matters related to the comment procedure, 
including the absence of an affirmative right to file reply comments;
     the definition of views;
     the Commission's option to suspend or forego solicitation 
of comments, including the proposed standard for exercising this 
option; and
     the availability of proposals and the Commission's views.
    Having considered the comments received, the Commission adopts 
final rules that reflect several revisions to the proposed rules in 
response to comments as well as several other minor changes. The latter 
include revisions to reflect the Commission's intention to designate 
future dockets established pursuant to 39 CFR part 3017 as 
``International Mail'' (IM) dockets, instead of ``Public Inquiry'' (PI) 
dockets, and to refer to ``comments'' instead of ``public comments.'' 
The Commission used the IM docket designation prior to the enactment of 
the PAEA for agency action related to preparation of a series of annual 
reports to Congress on international mail financial results. This 
change, which makes it easier for interested persons to locate 
international documents on the Commission's Web site, requires minor 
conforming changes to several of the proposed sections of part 3017.

B. Applicability of APA Procedural Requirements to Commission Views

    Proposed rules. The Commission proposed adding rules in a new part 
3017 to provide the public with a description of the general procedures 
it plans to use in connection with the development of views pursuant to 
39 U.S.C. 407(c)(1), primarily with regard to obtaining public input. 
The proposed rules incorporate procedures consistent with the 
Commission's core responsibility to provide its views to the Secretary 
of State in a timely manner. The proposed rules also reflect the 
Commission's commitment to having the docket serve as a mechanism for 
handling related matters, such as informing the public about the 
availability of relevant proposals, the Commission's views, or other 
documents.
    Commenters' positions. FedEx asserts that the proposed docket must 
comply with the notice and comment requirements of the APA, located in 
5 U.S.C. 553.\9\ FedEx states that the Commission must employ APA 
procedures whenever it adopts a rule, and asserts there is ``no 
reasonable doubt that the [v]iews are a `rule' as defined by the APA.'' 
FedEx Comments at 8. FedEx acknowledges that there are several 
exceptions to the APA notice and comment requirements, and comments 
that the foreign affairs exception is the only one that ``could 
plausibly be deemed applicable.'' Id. at 8-9.
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    \9\ FedEx Comments at 8-12; FedEx Reply Comments at 4.
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    FedEx asserts that Congress has carefully avoided the procedural 
dilemma that combining regulatory and executive functions poses by 
deliberately creating a bifurcated decision-making process in 39 U.S.C. 
407(c)(1) and (c)(2). Id. at 9. According to FedEx, under this process 
the Commission's responsibility is to apply title 39 of the U.S. Code 
to the rates and classifications under consideration, while the 
responsibility of the Secretary of State is to protect the foreign 
policy and national security interests of the United States by 
limiting, if necessary, application of the Commission's views. Id. 
FedEx acknowledges that the courts have never addressed this 
bifurcation in the context of the approval of intergovernmental postal 
agreements, but cites two cases it alleges concern similar bifurcations 
of regulatory and foreign policy functions in support of its 
position.\10\
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    \10\ Id. at 9-10. See South African Airways v. Dole, 817 F.2d 
119 (D.C. Cir. 1987); and Aerolineas Argentinas S.A. v. U.S. 
Department of Transportation, 415 F.3d 1 (D.C. Cir. 2005) 
(hereafter, South African Airways and Aerolineas Argentinas, 
respectively).
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    FedEx contends that South African Airways concerned a bifurcation 
of functions very similar to those in section 407. FedEx Comments at 9-
10. As explained by FedEx, in South African Airways, the Court of 
Appeals for the District of Columbia Circuit found it appropriate for a 
court to review an order of the Secretary of Transportation revoking a 
permit of a foreign air carrier. Id. at 10. While such orders were 
subject to disapproval for foreign policy or national defense 
considerations by the President, the court found that judicial review 
was appropriate because the Secretary of Transportation's order was 
based on economic considerations and thus did not encroach on the 
President's foreign policy powers. Id.
    FedEx contends that the South African Airways holding was confirmed 
and extended in Aerolineas Argentinas. Id. at 11. In support of this 
contention, FedEx asserts that the Court of Appeals for the District of 
Columbia Circuit held that a determination by the Secretary of 
Transportation that Argentina had unjustly discriminated against U.S. 
carriers was subject to judicial review

[[Page 871]]

after expiration of the period in which the President could have, but 
did not, disapprove of the determination. Id. FedEx asserts that the 
court ``pointedly noted'' that it should not lightly presume that 
Congress intended to grant the Department of Transportation ``an 
unreviewable discretion to engage in otherwise noxious 
decisionmaking.'' Id. FedEx concludes that the two cases demonstrate 
that the Commission must comply with the requirements of 5 U.S.C. 553 
because the Commission's views do not involve a foreign affairs 
function of the United States. Id. at 11-12.
    UPS supports FedEx's proposal to amend the proposed rules and 
incorporate APA notice and comment procedures on grounds that the 
Commission's views meet the definition of a rule under the APA because 
they are agency statements interpreting or prescribing law or policy. 
Corrected UPS Reply Comments at 8 n.6. UPS also asserts that the 
Commission has an important role under section 407(c)(1), noting that 
the Commission's views should be crucial in determining the Secretary 
of State's posture in international postal negotiations. Id. at 2. It 
nevertheless concludes that the foreign affairs exception is 
inapplicable on grounds that it is a particularly narrow exception to 
APA notice and comment requirements. Id. at 8-9. UPS asserts that for 
the exception to apply, the rulemaking should provoke undesirable 
international consequences, and concludes that complying with APA 
notice and comment procedures ``could hardly be said'' to produce this 
result. Id. at 9. UPS also contends that the scope of comments and the 
Commission's views are limited to compliance with the standards and 
criteria established by the Commission under 39 U.S.C. 3622 and 
concludes the foreign affairs exception is inapplicable because 39 
U.S.C. 3622 does not directly concern foreign affairs. Id.
    The Public Representative and the Postal Service assert that 
characterization of the Commission's views as a rule under the APA is 
incorrect.\11\ The Public Representative states that while the APA 
broadly defines a rule, the definition does not include a statement 
from an expert agency intended to inform the Secretary of State on the 
consistency of a potential international agreement with U.S. 
regulations. PR Reply Comments at 2. Moreover, she contends that a 
significant characteristic of a rule to which APA notice and comment 
procedures apply is that the rule must have the force and effect of 
law. Id. She reasons that a view does not fall under the APA's broad 
definition of a rule because absent action by the Secretary of State, 
it lacks any future legal effect. Id. The Public Representative also 
notes that a UPU body must approve the relevant proposals before they 
can take effect. Id. at 3.
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    \11\ PR Reply Comments at 2; Postal Service Reply Comments at 4.
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    The Public Representative also considers FedEx's reliance on South 
African Airways misplaced because the order at issue in that case is 
distinguishable from the Commission's views. Id. First, she asserts 
that the order from the Secretary of Transportation revoking foreign 
air carrier permits is distinguishable because the order was presented 
for presidential review while views are subject to the approval of the 
Secretary of State. Id. at 3-4. Second, the order at issue in South 
African Airways revoked a permit, while views provide the Secretary of 
State with the expert opinion of the agency in the best position to 
determine the consistency of such rates and classifications with 
domestic postal law before the Secretary supports or opposes a 
proposal. Id. at 4. She asserts that Congress intended for views to 
contribute to the development of the United States' position on a 
specific foreign relations matter, while the Secretary of 
Transportation revoked South African Airways' permit pursuant to a 
foreign policy determination expressed by Congress, by statute, and the 
President, by executive order. Id. at 4-5.
    The Postal Service asserts that FedEx's assertion that the 
Commission providing its views to the Secretary of State constitutes 
issuance of an agency rule pursuant to the APA is simply wrong. Postal 
Service Reply Comments at 4. It contends that FedEx's discussion of the 
definition of rule relies on only part of the definition, and that a 
complete understanding of the APA definition of rule clearly 
establishes that the views of the Commission are not a rule subject to 
the APA rulemaking requirements. Id.
    The Postal Service states that a rule as defined by the APA 
implements, interprets, or prescribes law or policy. Id. at 5. The 
Postal Service examines each of these characteristics separately as 
they relate to the role of the Commission in 39 U.S.C. 407(c)(1) and 
contends that the views do not constitute rules under the APA. Id. It 
states that implementation of a law or policy requires an action that 
results in an impact on a specific party, and contends that views are 
merely the position of the Commission on the consistency of UPU 
proposals with U.S. postal laws that assist the Secretary of State in 
making foreign policy decisions. Id. at 5. The Postal Service asserts 
that interpretation relates to an agency action to review and provide a 
true meaning or understanding as to language. Id. It concludes that 39 
U.S.C. 407(c)(1) does not involve any interpretation by the Commission. 
Id. Finally, the Postal Service states the Commission's views do not 
prescribe law or policy within the purview of the Commission; instead, 
it asserts the views have no legal or policy ramifications, but instead 
provide interagency guidance. Id. As such, the Postal Service contends 
these views are not a rule under the APA and the Commission need not 
comply with the formal rulemaking requirements of title 5 of the United 
States Code. Id.
    Commission analysis. Under the APA, a rule is defined broadly and 
includes any agency statement of general or particular applicability 
and future effect designed to implement, interpret, or prescribe law or 
policy, including the approval or prescription for the future of rates. 
5 U.S.C. 551(4). Rulemaking is the agency process for formulating, 
amending, or repealing a rule.\12\ 5 U.S.C. 551(5). Significantly, 5 
U.S.C. 553, which addresses rulemakings, provides an exception to the 
requirements of that provision to the extent a military or foreign 
affairs function of the United States is implicated by the rulemaking 
or the rulemaking relates to agency management or personnel or to 
public property, loans, grants, benefits, or contracts. 5 U.S.C. 
553(a)(1) and (2).
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    \12\ Rulemaking is one of two categories of agency actions 
defined in the APA; adjudication is the other. See 5 U.S.C. 551(7). 
Adjudication involves matters such as the issuance of permits or 
certificates. 5 U.S.C. 551(8). No commenter addressing APA 
procedural requirements asserts that development of views involves 
adjudication.
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    Under 5 U.S.C. 553, rulemakings generally require that an agency 
publish a notice concerning the intended rulemaking in the Federal 
Register and provide an opportunity for commenters to submit written 
comments. 5 U.S.C. 553(b)(1)-(3); 5 U.S.C. 553(c). Publication of a 
substantive rule is to occur not less than 30 days before the effective 
date, except in certain specified circumstances. 5 U.S.C. 553(d)(1)-
(3).
    FedEx and UPS contend that views are rules as defined by the APA, 
and as a result, FedEx and UPS assert that the Commission should amend 
the proposed rules to ensure that the APA's notice and comment 
requirements are incorporated into the final rules. FedEx Comments at 
8-12; Corrected UPS

[[Page 872]]

Reply Comments at 8-9. The Postal Service and the Public Representative 
disagree and provide support for their assertion that the APA's notice 
and comment requirements do not apply to views. Postal Service Reply 
Comments at 4-6; PR Reply Comments at 2-5. As a whole, the comments 
raise two distinct questions concerning the applicability of the APA to 
views: Whether views constitute rules under 5 U.S.C. 551(4); and 
whether views must comply with the notice and comment requirements of 5 
U.S.C. 553 if views are in fact rules under the APA. The Commission 
concludes that views are not rules as defined by the APA, and that even 
if views were considered to be rules, they are exempt from the notice 
and comment requirements of 5 U.S.C. 553.
    Determining whether views are rules under the APA begins with 
examination of the function the Commission performs in developing views 
and the statutory authority for the exercise of that function. With 
respect to function, the plain language of 39 U.S.C. 407 makes clear 
that Commission views are an interagency advisory communication 
prepared at the request, and for the sole consideration of, the 
Secretary of State prior to his/her conclusion of treaties, 
conventions, or amendments addressing certain international postal 
rates and classifications. See 39 U.S.C. 407(c)(1) and (2). This 
interagency communication advises the Secretary of State on the 
consistency of those rate and classification proposals with title 39 
policies. The advisory nature of views is demonstrated by how many 
steps the views are removed from final international postal rates and 
classifications. After the Commission transmits its views to the 
Secretary of State, the Secretary of State then finalizes U.S. 
positions on UPU proposals consistent with the Commission's views 
unless the Secretary of State determines foreign policy or national 
security reasons dictate otherwise. 39 U.S.C. 407(c)(2). The Secretary 
of State then uses the various U.S. positions to negotiate and act on 
UPU proposals. The UPU Acts are then amended to incorporate adopted 
proposals and generally must be signed by the President or his/her 
delegate for U.S. ratification or accession. The Commission's views are 
simply too many steps removed from the final rates and classifications 
adopted by the UPU and signed by the President to be classified as 
rules. The number of steps between the view and a final binding 
decision also distinguishes views from the types of orders at issue in 
South African Airways and Aerolineas Argentinas.\13\
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    \13\ The two cases are also distinguishable from views on 
several other grounds, including that the orders in these cases 
involved action on permits, not rates and classifications. Agency 
action on permits falls within the APA definition of a license, 
which is associated with adjudication (and related orders), rather 
than rulemaking. See 5 U.S.C. 551(8); see also 5 U.S.C. 551(6) and 
(7). In addition, the facts involved statutory provisions that 
mandated issuance of an order and directly addressed the terms for 
judicial review of permit actions, in contrast to section 407's 
silence on issuance of an order and judicial review.
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    The advisory, interagency nature of the communication and the 
subject matter--international rates and classifications--also 
materially distinguish the Commission's views from the conventional 
rulemaking activity of ratemaking. The Commission's domestic rate and 
classification rulemakings typically are not purely advisory in nature, 
nor are they designed for the sole consideration of the Secretary of 
State. Instead, these rulemakings are intended to have binding effect 
on those who are regulated (or engage in activities regulated) by the 
agency conducting the rulemaking. However, the Secretary of State 
pursuant to title 39 exercises the primary authority for the conduct of 
foreign policy with respect to international postal and delivery 
services, including the determination of U.S. positions in negotiations 
with foreign governments and international bodies. See 39 U.S.C. 
407(b)(2).
    The Commission provides advisory views to the Secretary of State, 
which are distinct from rules under the APA that directly implement, 
interpret, or prescribe law or policy with respect to the application 
of future rates, wages, or prices. Commission views do not prescribe, 
establish, or enforce international rates or classifications. These 
considerations all support the conclusion that views sent to the 
Secretary of State are a statutory responsibility that falls outside 
the APA's definition of a rule.
    Even if views were considered rules under the APA, the notice and 
comment requirements of 5 U.S.C. 553 do not apply. First, under the 
APA, substantive legislative rules are the only rules subject to the 
notice and comment requirements of 5 U.S.C. 553.\14\ Legislative rules 
are defined as ``those that grant rights, impose obligations, or 
produce other significant effects on private interests.'' Id. (citing 
Batterton v. Marshall, 648 F.2d 694, 701-02 (D.C. Cir. 1980)). 
Legislative rules also must have legal effect. Id. The test for 
determining whether a rule has legal effect involves consideration of 
the following factors: ``(1) Whether in the absence of the rule there 
would not be an adequate legislative basis for enforcement action or 
other agency action to confer benefits or ensure the performance of 
duties, (2) whether the agency has published the rule in the Code of 
Federal Regulations, (3) whether the agency has explicitly invoked its 
general legislative authority, [and] (4) whether the rule effectively 
amends a prior legislative rule.'' Id. (citing Am. Mining Cong. v. Mine 
Safety & Health Admin., 995 F.2d 1106, 1112 (D.C. Cir. 1993)). Courts 
also consider the agency's characterization of its rule and whether the 
rule has been applied consistently in the past. Id.
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    \14\ Perez v. Mortgage Bankers Assn, 135 S.Ct. 1199, 1203-04 
(2015); Mountain States Health Alliance v. Burwell, No. 13-641, 2015 
WL 5297498, at *7 (D.D.C. Sep. 10, 2015).
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    The Commission's views are not substantive legislative rules. They 
do not grant rights or impose obligations, nor do they produce other 
significant effects on private interests; instead, they simply advise 
the Secretary of State. They have not been and will not be published in 
the Federal Register. The Commission provides its advisory views in 
accordance with 39 U.S.C. 407(c)(1), which does not grant the 
Commission general legislative authority. Views, unlike regulations, do 
not amend past views but instead address current UPU proposals. 
Therefore, even if views were considered to be rules, the notice and 
comment requirements of 5 U.S.C. 553 do not apply.
    Second, views are also exempt from APA notice and comment 
requirements pursuant to 5 U.S.C. 553(a)(1) as an agency action 
involving a foreign affairs function. In considering the applicability 
of the foreign affairs exception, the initial question is whether a 
view involves a foreign affairs function. Several factors support the 
conclusion that this is the case with Commission views. For example, 
the Commission's responsibility for developing a view is lodged in 39 
U.S.C. 407(c)(1). The parent provision, 39 U.S.C. 407, is captioned 
``International postal arrangements.'' Also, contextually, the plain 
language of 39 U.S.C. 407(c)(1) establishes the requisite nexus to a 
foreign affairs function by providing that ``before concluding any 
treaty, convention, or amendment'' that establishes a rate for a market 
dominant product, the Secretary of State shall request the Commission's 
views. By definition, the Commission is advising the Secretary of State 
on matters directly related to foreign affairs--the terms of 
international postal treaties, conventions, and amendments.

[[Page 873]]

    As exemptions to the APA's procedural requirements are to be 
narrowly construed, the second question is whether a rulemaking would 
unduly interfere with the asserted foreign affairs function. If not, 
the exemption generally does not apply.\15\ The critical considerations 
associated with 39 U.S.C. 407(c), in terms of the Commission's role, 
are the soundness and timeliness of the views, as the Secretary of 
State must have an opportunity to review and assess them prior to 
concluding his/her responsibilities under 39 U.S.C. 407(c), which 
includes development of U.S. positions on UPU proposals.
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    \15\ See United States Department of Justice, Attorney General's 
Manual on the Administrative Procedure Act 26 (1947), noting that 
the Senate and House reports stated that the phrase ``foreign 
affairs function'' is not to be loosely interpreted to mean any 
function extending beyond the borders of the United States, but only 
to those ``affairs'' which so affect relations with other 
governments that, for example, the public rulemaking provisions 
would clearly provoke definitely undesirable international 
consequences. In addition, it has been held that modification, 
interpretation, or violation of an international agreement's terms 
are clearly and directly matters of foreign affairs. Mast 
Industries, Inc. v. Regan, 596 F. Supp. 1567, 1579 (1984).
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    In practice, the development of the Commission's view occurs within 
an extremely compressed timetable. Given this practical reality, 
compliance with all APA procedural requirements would hamstring the 
Commission's ability to provide the Secretary of State with sound, 
timely views. A brief review of the process illustrates the 
difficulties.
    First, development of a Commission view typically occurs in the 
context of a UPU Congress. The UPU is solely responsible for 
determining the distribution schedule for the proposals the Commission 
reviews. In light of different submission deadlines and the need for 
translation, typically the UPU does not make all proposals available at 
once, and often makes many proposals available only very near the start 
of a UPU Congress. In some cases, amendments to proposals are only made 
available immediately before the meeting at which the proposals are to 
be considered. In addition, verbal amendments may be proposed during 
deliberations.
    Second, the Commission is unable to ensure the availability of the 
proposals to interested parties because the UPU does not make them 
publicly available.
    Third, upon receipt of the proposals, development of views entails 
deliberations by the Commission and coordination of a view in time for 
the Secretary of State to have a meaningful opportunity to consider the 
Commission's advice. In cases when proposals are made available by the 
UPU with very little time for evaluation, the Commission will 
frequently provide its preliminary assessment verbally, following up 
later with a written view. Ensuring that interested persons have an 
opportunity to review all proposals--and responding to each concern as 
occurs in most rulemakings--would preclude timely preparation and 
submission of views to the Secretary of State.
    Fourth, given the compressed timetable under which 39 U.S.C. 407(c) 
functions occur, waiting until 30 days after publication in the Federal 
Register would in many cases mean that the Secretary of State could not 
rely on the Commission's views until well after a U.S. position had 
been developed and the proposals are deliberated at the UPU. See 5 
U.S.C. 553(d)(3). For these reasons, the foreign affairs exemption 
would apply if views were found to be rules within the meaning of the 
APA.

C. Section 3017.1(a)--Definition of Modern Rate Regulation

    Proposed rule. Proposed Sec.  3017.1(a) defines modern rate 
regulation as the standards and criteria the Commission has established 
pursuant to 39 U.S.C. 3622.
    Commenters' positions. The Postal Service proposes that the 
definition of modern rate regulation be amended to ``the standards and 
criteria that the Commission has established in [39 CFR part 3010] with 
respect to rates and part 3020 with respect to classification pursuant 
to its authority in [39 U.S.C. 3622].'' Postal Service Comments at 9. 
The Postal Service observes that the definition in the proposed rules 
is identical to the statutory language of 39 U.S.C. 407(c)(1). Id. 
However, it contends that this definition, if interpreted as it has 
been in the past, not only deviates from the Commission's statutory 
authority, but may result in confusion for members of the public and 
unnecessary work for those submitting comments. Id. at 2. It urges the 
Commission to clarify the definition to ensure comments do not exceed 
the scope of the Commission's views as delineated by 39 U.S.C. 
407(c)(1). Id.
    The Postal Service notes that in Docket No. PI2012-1, the 
Commission solicited comments on the principles that should guide 
development of its views on the consistency of proposals with the 
standards and criteria of 39 U.S.C. 3622. Id. at 6. It asserts that 
this solicitation, while closely related to the statute, exceeded the 
scope of 39 U.S.C. 407(c)(1) and resulted in comments focused on the 
objectives and factors of 39 U.S.C. 3622 rather than the standards and 
criteria established by the Commission. Id. at 7. The Postal Service 
contends that its proposed definition of modern rate regulation 
unambiguously identifies the standards and criteria established by the 
Commission as being found in part 3010 for UPU proposals related to 
rates and in part 3020 for UPU proposals related to classifications, 
and points commenters to the relevant regulations on which the 
Commission will base its view to the Secretary of State. Id. at 9-10.
    The Postal Service suggests that changes in these rates might be 
analogized to a Type 1 rate adjustment and proposes that the standards 
for Type 1 rate adjustments in 39 CFR 3010.11(d) be applied to UPU 
proposals. Id. at 5. The Postal Service also notes that part 3020 
establishes the rules for Postal Service products and the 
classification of those products. Id. With respect to the Commission 
review process of UPU proposals, however, it states that part 3020 is 
rarely applicable because UPU proposals reviewed by the Commission 
rarely relate to classification changes for market dominant products. 
Id. Thus, the Postal Service asserts that the Commission usually does 
not need to consider the standards and criteria in part 3020 when 
issuing its views to the Secretary of State. Id.
    UPS asserts that the Postal Service's proposed definition of modern 
rate regulation is inconsistent with 39 U.S.C. 407(c) and urges the 
Commission to reject it. Corrected UPS Reply Comments at 1. UPS 
observes that the issues raised by UPU proposals extend beyond the 
legality of terminal dues rates. Id. at 4. It asserts that the 
Commission must also consider other UPU proposals in light of, for 
example, the objective of 39 U.S.C. 3622(b)(7) to enhance mail security 
and deter terrorism. Id.
    UPS also contends the Postal Service's proposal is at odds with how 
the Postal Service interpreted the Commission's authority in 2012, when 
the Postal Service stated that under section 407(c), the Commission is 
tasked with providing its view on whether proposals are consistent with 
the 39 U.S.C. 3622 objectives and factors. Id. at 10 n.7.
    UPS asserts that when the Commission considers the objectives and 
factors of 39 U.S.C. 3622 in evaluating UPU proposals, it is giving 
heed to the statutory language of 39 U.S.C. 407(c)(1). Id. at 10. UPS 
contends that any standard or criterion established by the Commission 
``under'' section 3622 must be consistent with section 3622 because 
agencies'

[[Page 874]]

jurisdiction and substantive powers are limited by statute, and they 
can only act in conformance with their statutory mandate. Id.
    UPS also states that having empowered and required the Commission 
to craft regulations in conformance with section 3622, it is 
implausible that Congress would require that the Commission ignore 
section 3622 when evaluating UPU proposals. Id. at 11. It states that 
agencies must always consider their governing statutes when taking any 
action and must ensure that their actions are consistent with those 
statutes. Id. UPS contends that at a minimum, 39 U.S.C. 407(c)(1) 
should not be read as preventing the Commission from considering the 
objectives and factors of 39 U.S.C. 3622. Id. UPS asserts that 39 
U.S.C. 407(c)(1) is most sensibly read as affirmatively encouraging the 
Commission to consider the objectives and factors. Id.
    FedEx agrees, in principle, with the Postal Service's assertion 
that the Commission's approach to reviewing proposed UPU rates and 
classifications for market dominant products should closely parallel 
the agency's review of rates and classifications for market dominant 
domestic products, but disagrees with the Postal Service on the 
implications of this observation for the proposed rules. FedEx Reply 
Comments at 1. FedEx disagrees with the Postal Service's conclusion 
that 39 CFR parts 3010 and 3020 prohibit commenters and the Commission 
from considering the consistency of relevant UPU proposals with title 
39 requirements other than those explicitly mentioned in 39 CFR parts 
3010 and 3020. Id. at 3. It observes, for example, that 39 CFR 
3010.11(c) provides that public comments may address other relevant 
statutory provisions and applicable Commission orders and directives. 
Id. Moreover, FedEx notes that the Postal Service's position that 39 
CFR parts 3010 and 3020 constrain the Commission's review rests on the 
assumption that UPU rates are considered a Type 1 rate adjustments, an 
issue that the Commission has not decided. Id.
    FedEx asserts that given the intense reconsideration of product 
definitions now underway at the UPU, it is hardly self-evident that the 
rates and classifications that will be proposed for consideration at 
the next UPU Congress should be considered analogous to Type 1 rate 
adjustments. Id. It also argues that the international nature of UPU 
rates necessarily requires the Commission to consider some elements of 
title 39 that are not involved in a review of domestic rates and 
classifications. Id.
    Commission analysis. The Commission declines to adopt the revision 
proposed by the Postal Service. The Commission concludes that the 
definition as originally proposed, which defines modern rate regulation 
in terms ``identical to the statutory language of [39 U.S.C. 
407(c)(1)],'' is appropriate. See Postal Service Comments at 9. In 
addition to being consistent with the statute, the definition is also 
consistent with the Commission's past practices with respect to 
providing its views to the Secretary of State on the consistency of 
such rate or classification with modern rate setting criteria.\16\
---------------------------------------------------------------------------

    \16\ See e.g., Order No. 2602 at 1-2; Docket No. PI2012-1, 
Comments of the United States Postal Service, August 27, 2012, at 2-
4.
---------------------------------------------------------------------------

    The Postal Service's proposed modification would also artificially 
detach the Commission's views from the underlying objectives and 
factors of modern rate regulation, which are the basis of the 
``standards and criteria established by the Commission under section 
3622.'' 39 U.S.C. 407(c)(1). Moreover, the Postal Service's proposed 
analogy to Type 1 rate cases seemingly conflicts with its comments in 
light of the fact that sections in 39 CFR part 3010 request expansive 
comments (i.e., 39 CFR 3010.11(c)) and explicitly refer to the 
objectives and factors enumerated in 39 U.S.C. 3622 (i.e., 39 CFR 
3010.12(b)(7) and (8)). Furthermore, the Postal Service's suggestion to 
restrict the definition to 39 CFR parts 3010 and 3020 is too limiting. 
For example, the Commission's authority to regulate service performance 
standards was also drawn from 39 U.S.C. 3622. See 39 CFR part 3055. 
Consequently, the Commission declines to adopt the Postal Service's 
proposed modification and adopts the proposed paragraph (a) as a final 
rule, without change.

D. Section 3017.1(b)--Definition of Views

    Proposed rule. Proposed Sec.  3017.1(b) defines views as the 
opinion the Commission provides to the Secretary of State in the 
context of certain UPU proceedings on the consistency of a proposal 
affecting a market dominant rate or classification with modern rate 
regulation.
    Commenters' positions. FedEx and the Public Representative suggest 
revisions to the definition of views. FedEx asserts that the definition 
should correspond to the scope of the Commission's obligations under 
section 407(c)(1), and should not be limited only to the opinion the 
Commission provides to the Secretary of State in the context of certain 
UPU proceedings. FedEx Comments at 12-13. Instead, FedEx contends that 
the definition should encompass each opinion the Commission is obliged 
to provide to the Secretary of State before a treaty, convention, or 
amendment that establishes a rate or classification for a product 
subject to subchapter I of chapter 36 is concluded. Id. FedEx asserts 
that section 407(c)(1) applies to all rates and classifications for 
international market dominant products established by the Secretary of 
State by intergovernmental agreement. Id. at 13.
    In response, the Public Representative asserts that FedEx's 
proposed revision is unnecessary. PR Reply Comments at 6. She 
nonetheless states that the proposed rules may benefit from clarifying 
that part 3017 does not preclude the Commission from initiating a 
docket and soliciting comments on a relevant non-UPU treaty, 
convention, or amendment. Id. at 6-7.
    The Public Representative also recommends, in conjunction with a 
suggestion to add a definition of relevant proposal, that the proposed 
definition of views be limited to opinions on ``relevant proposals.'' 
PR Comments at 6-7. She notes that the proposed rules indicate that the 
Commission will provide views on proposals that affect a market 
dominant rate or classification but would not exclude proposals that 
are unable to be assessed because they are for future rates or 
classifications and lack the detail needed to make an assessment, or 
proposals that were rejected or withdrawn. Id. at 7. The Public 
Representative recommends that the Commission amend Sec.  3017.1 to 
limit views to relevant proposals and then offer a separate definition 
of relevant proposal in Sec.  3017.1. Id. at 7; Attachment 1 at 1.
    Commission analysis. FedEx proposes to define views as opinions the 
Commission provides to the Secretary of State before the Secretary of 
State concludes any treaty, convention, or amendment that establishes a 
rate or classification for a product subject to subchapter I of chapter 
36. This accurately reflects the language of 39 U.S.C. 407(c)(1). 
However, each applicable ``treaty, convention, or amendment'' since the 
PAEA was enacted has occurred in the context of certain UPU 
proceedings. It appears that the two suggested approaches have 
identical practical effects and that tying each docket to a specific 
UPU Congress will allow interested persons to more easily track 
relevant proposed changes. As a result, the Commission adjusts the 
definition of views in Sec.  3017.1 to accommodate the scope of the 
statute as

[[Page 875]]

discussed above. Part 3017 is not intended to preclude the Commission 
from establishing a docket, accepting comments, or giving views in non-
UPU contexts that meet the requirements of 39 U.S.C. 407(c)(1).
    The Commission also concludes that the proposals on which it 
provides its views do not require clarification. According to the 
proposed definition, the Commission only gives views on ``. . . the 
consistency of a proposal affecting a market dominant rate or 
classification with modern rate regulation.'' The requirement that the 
proposal affect a market dominant rate or classification excludes 
proposals that will not have an effect because they have been withdrawn 
or rejected, as well as proposals with effects unable to be assessed 
because they lack the requisite detail to make an assessment. 
Consequently, except for the changes in the definition section as 
explained above, the Commission adopts the proposed rule as a final 
rule without any additional changes relating to the comments regarding 
proposals.

E. Section 3017.2--Purpose

    Proposed rule. The proposed rule states that the proposed part 
3017's purpose is to facilitate public participation in, and promote 
the transparency of, the development of Commission views.
    Commenters' positions. No commenter specifically addresses this 
proposed rule.
    Commission analysis. The Commission has reviewed this section and 
concludes that it accurately describes the purpose of the rules. 
Consequently, it adopts the proposed rule as a final rule, without 
change.

F. Section 3017.3--Establishment and Scope of Docket

    Proposed Sec.  3017.3 consists of three paragraphs. As proposed, 
paragraph (a) establishes the target date for establishing a public 
inquiry docket as on or about 150 days before a UPU Congress convenes, 
and states that the Commission will solicit comments on the general 
principles that should guide the Commission's development of views on 
relevant proposals, in a general way, and, if available, on specific 
relevant proposals. Proposed paragraph (b) states that the public 
inquiry docket established pursuant to paragraph (a) of this section 
may also encompass matters related to development of the Commission's 
views, such as the availability of relevant proposals, the views, other 
documents, and related actions. Proposed paragraph (c) provides that 
the notice establishing each public inquiry docket will be published in 
the Federal Register.
1. Scope of the Docket
    Commenters' positions. FedEx seeks expansion of the scope of the 
public inquiry docket to include all international agreements that 
impact rates or classifications of market dominant products. FedEx 
Comments at 13. It asserts that the wording of paragraph (a) suggests 
that the Commission can limit its views to a high level review of 
proposed rates and classifications; however, it contends that 39 U.S.C. 
407(c)(1) clearly requires the Commission to consider carefully all of 
the criteria set out in 39 U.S.C. 3622. Id. FedEx also asserts that the 
Commission cannot fail to provide views on relevant proposals merely 
because they are not available on or about 150 days before a UPU 
Congress convenes. Id. It further asserts that the Commission is 
obliged by 39 U.S.C. 407(c)(1) to develop views on specific proposals 
as they become available. Id.
    The Postal Service characterizes FedEx's position as ``directly 
counter to the plain reading of section 407(c)(1).'' Postal Service 
Reply Comments at 5. It notes that FedEx uses the word ``agreement,'' 
which is different and distinct from what is set forth in the statute. 
Id. The Postal Service asserts that 39 U.S.C. 407(c)(1) requires the 
Secretary of State to seek the Commission's view prior to concluding 
any treaty, convention, amendment. Id. at 5-6. The Postal Service 
asserts that these terms are distinct from an ``agreement'' as 
interpreted by FedEx, and that the Commission has properly focused the 
proposed rules on issues governed by the UPU Congress. Id. at 6. The 
Postal Service further asserts that 39 U.S.C. 407(c)(1) ``only applies 
to decisions taken by the United States, [through] the Secretary of 
State, at the UPU Congress, and thus the Commission need not create a 
procedure for public solicitation of comments for every UPU proposal at 
meetings between UPU Congresses.'' Id.
    In response to FedEx, the Public Representative notes that proposed 
Sec.  3017.3 can be interpreted as providing a docket for each UPU 
Congress, including the relevant proposals for UPU meetings following 
that Congress but prior to the next Congress. PR Reply Comments at 7. 
She nonetheless does not object to a clarification of the rule. Id. The 
Public Representative also responds to FedEx's statement that proposed 
Sec.  3017.3(a) suggests that the Commission can limit its views to a 
high level review. Id. She argues that the language from the proposed 
rule that FedEx applies to views was intended to apply to commenters. 
It was also intended to allow comments on both specific proposals and 
general principles that can be applied to various proposals or in cases 
where specific proposals are unavailable. Id. at 7-8. The Public 
Representative concludes that she supports Sec.  3017.3 as proposed. 
Id. at 8.
    Commission analysis. FedEx highlights a need to revise the wording 
of Sec.  3017.3 to clarify that it is the solicitation of comments that 
may be limited due to the Commission's inability to make proposals 
available. FedEx Comments at 13. The Commission intends for Sec.  
3017.3(a) to allow for comments to cover both approaches and principles 
that pertain to the proposals generally as well as specific proposals 
when the Commission is able to make these available.
    FedEx also is concerned the proposed rules are too narrowly 
tailored to UPU Congresses. Id. at 13. As noted in Order No. 2602, each 
docket will cover a UPU Congress and related meetings. Order No. 2602 
at 2-3. To further clarify its intent in the proposed regulations, the 
Commission will insert into section 3017.3 the phrase, ``or such 
advance time as the Commission determines for any other 39 U.S.C. 
407(c)(1) matter.'' The Commission adopts the proposed Sec.  3017.3 as 
a final rule, with clarifications outlined above concerning the scope 
of comments and revisions to reflect the intention to use the IM 
designation.
2. Availability of Proposals
    Commenters' positions. The Public Representative suggests that the 
Commission make every effort to provide the text or a detailed summary 
of the relevant proposals to the public. PR Comments at 3. She believes 
this will facilitate discussion by providing potential commenters with 
a lexicon of terms and titles for use in referencing specific proposals 
and with better information about the scope of issues in each docket. 
See generally PR Comments at 3-5. By not providing proposals, the 
Public Representative is concerned the public is segregated into those 
who have independent knowledge of proposals and those who do not. Id. 
at 5. The Public Representative acknowledges that circumstances may 
prevent the Commission from providing text or summaries of all 
proposals, but nonetheless asserts that the Commission should provide 
information regarding specific proposals in advance. Id. at 6. UPS 
supports this suggestion, and further supports any and all efforts by

[[Page 876]]

the Commission to provide as much information as soon as possible. 
Corrected UPS Reply Comments at 6. It asserts that ``[o]therwise, any 
discussion of the proposals would likely lack meaningful impact.'' Id.
    The Postal Service observes that UPU proposals generally are not 
publicly available documents, and states that the Commission should not 
release documents that are not publicly available. Postal Service Reply 
Comments at 2. In addition, the Postal Service contests the Public 
Representative's contention that absent the Commission's provision of 
the proposals, the public is not in a position to provide meaningful 
feedback. Id. The Postal Service states that the ability to provide 
comments on how the Commission should undertake its statutory role is 
not dependent on access to specific proposals. Id. It states that the 
prior public inquiry docket shows that the public can comment on broad 
policy objectives and principles. Id.
    The Postal Service also asserts that comments on specific proposals 
``will significantly burden the commenters and the Commission without 
providing the overarching opinions of the commenters that are most 
beneficial to the Commission in developing its views.'' Id. In 
addition, the Postal Service states that the proposed rule 3017.3(a) 
already sets forth that when a specific proposal is relevant and deemed 
significant to assist in developing the Commission's view, the 
Commission will seek comments on that specific proposal. Id. The Postal 
Service asserts that the proposed rules appropriately seek general 
comments on relevant proposals that impact market dominant rates and 
classifications and specific proposals when determined necessary. Id. 
at 2-3.
    Commission analysis. The Commission appreciates commenters' 
interest in access to specific proposals. The Commission is neither the 
originator nor the official custodian of these documents and as such, 
it is not in a position to guarantee their availability. As commenters 
also acknowledge, the proposals are not usually publicly available. 
However, the rule expresses the Commission's intent to solicit comments 
on specific proposals if it can make them available.
    In addition, the Commission found comments on the general 
principles that should guide the Commission's development of views 
useful and informative in Docket No. PI2012-1. The inclusion of a 
reference to specific proposals in the proposed set of rules does not 
diminish the importance the Commission places on receiving general 
comments concerning suggested principles and approaches.

G. Section 3017.4--Comment Deadline(s)

    Proposed rule. Proposed Sec.  3017.4 consists of two paragraphs. 
Proposed paragraph (a) provides that the deadline for public comments 
will be established consistent with the Commission's assessment of its 
ability to file timely views with the Secretary of State. Proposed 
Sec.  3017.4(b) employs the same standard for suspending or foregoing 
solicitation of public comments if receiving comments would impede the 
Commission's ability to provide timely submission of views to the 
Secretary of State.
1. Suspending or Foregoing Solicitation of Public Comments
    Commenters' positions. FedEx, consistent with its position on the 
applicability of APA notice and comment requirements to a part 3017 
docket, suggests that provisions for deadlines and abbreviated 
procedures should conform to 5 U.S.C. 553. FedEx Comments at 14. FedEx 
does not consider timely submission of the Commission views to the 
Secretary of State an adequate justification for curtailing or 
eliminating notice and comment procedures required by the APA. Id.
    Joyce Dillard states comments should not be suspended or foregone 
because ``all public comment should be welcomed on any United States 
treaty, convention, amendment, or any other transactions.'' Dillard 
Comments at 1. She also states that privatization of the government 
should not be the Commission's objective. Id. She further asserts that 
the public needs a voice and representation. Id.
    FedEx agrees with Joyce Dillard's position on the public's need for 
a voice and representation. FedEx Reply Comments at 4. However, it 
suggests that Joyce Dillard's implication that the proposed procedures 
also imply the Commission's intent to foster privatization of the 
government may be due to a misunderstanding of the Commission's notice. 
Id. at 4-5. The Postal Service opposes Joyce Dillard's suggestions, 
arguing that ``the Commission should maintain the ability to forego 
solicitation of comments when necessary, especially when the submission 
of the Commission's views to the Secretary of State would otherwise be 
delayed.'' Postal Service Reply Comments at 6-7.
    The Public Representative states that circumstances may require 
suspending or foregoing comments in order to allow the Commission to 
provide views to the Secretary of State in a timely manner.\17\ She 
opposes FedEx's approach because it ``would negatively impact the 
United States' ability to negotiate and conclude international 
agreements.'' PR Reply Comments at 6. However, she suggests including a 
requirement for issuance of a notice of suspension as new Sec.  
3017.4(b)(1). PR Comments at 9-10; id. Attachment 1 at 2.
---------------------------------------------------------------------------

    \17\ PR Comments at 9-10; PR Reply Comments at 5.
---------------------------------------------------------------------------

    Commission analysis. As explained in section IV.B supra, the 
requirements of 5 U.S.C. 553 are inapplicable to Commission views. 
Although the APA notice and comment requirements do not apply, the 
Commission shares the commenters' interests in having procedures that 
enhance opportunities for public participation and has crafted part 
3017 for that reason. At the same time, Docket No. PI2012-1 
demonstrated for the Commission that providing an opportunity for input 
must be balanced with the Commission's primary statutory responsibility 
under 39 U.S.C. 407--the timely submission of its views to the 
Secretary of State. The Commission concludes that the standard for 
suspending and foregoing comments that appears in proposed Sec.  
3017.4(b) appropriately balances an opportunity for comment with the 
Commission's statutory responsibility. The Commission will endeavor to 
keep commenters informed when comments are suspended. Nonetheless, the 
Commission declines to adopt the Public Representative's suggestion of 
the issuance of a formal notice of suspension (or of foregoing) 
solicitation of comments on grounds that a formal requirement may 
reduce the Commission's ability to file timely comments with the 
Secretary of State.
    The Commission adopts proposed Sec.  3017.4 as a final rule, with 
minor editorial revisions to reflect the intention to use the IM 
designation and the replacement of ``public comment'' with ``comment.''
2. Absence of Provision for Reply Comments
    The Public Representative acknowledges that the Commission has 
explained that it is not initiating reply comments due to time 
constraints, but reads the proposed rules to allow interested parties 
the opportunity to submit reply comments at the Commission's 
discretion. PR Comments at 7-8. She encourages the Commission to 
provide interested parties an opportunity to submit reply comments

[[Page 877]]

if time permits and suggests incorporating reply comments into Sec.  
3017.4. Id. at 8; Attachment 1 at 2. She also suggests that the 
Commission provide advance notice of the opportunity to file reply 
comments as she believes this will facilitate timely public 
participation. Id. at 9; Attachment 1 at 2.
    UPS agrees with the Public Representative's suggestion with respect 
to providing for reply comments. Corrected UPS Reply Comments at 8. 
UPS's rationale is that reply comments are valuable because they allow 
parties to point out flaws in other parties' initial comments. UPS 
states that reply comments should expedite rather than delay 
development of the Commission's views. Id.
    The Postal Service contends that reply comments are unnecessary and 
would delay the proceedings. Postal Service Reply Comments at 3. It 
asserts that in the past, the Commission specifically set forth the 
policies and scope of the comments it was soliciting from the public, 
resulting in ample opportunity to develop and submit comments. Id. The 
Postal Service further asserts that the proposed dockets are not 
adversarial proceedings requiring counter arguments and that a single 
round of comments is sufficient to allow commenters to provide their 
own views to the Commission. Id.
    Commission analysis. As the Public Representative and the Postal 
Service note, the Commission did not originally include an opportunity 
to file reply comments when it established Docket No. P2012-1. However, 
the Commission subsequently granted a request to file reply comments, 
but due to the timetable concluded that it could only allow 3 days for 
reply comments.\18\ The limited time for reply comments allowed in 
Docket No. PI2012-1 strained the Commission's preparation of views and, 
as the Public Representative observes, the limited time also may not 
have provided all commenters with adequate time to review the initial 
comments and file responses.
---------------------------------------------------------------------------

    \18\ Docket No. PI2012-1, Order No. 1451, Order Allowing for 
Reply Comments, August 28, 2012.
---------------------------------------------------------------------------

    The Commission appreciates that reply comments may provide 
additional useful insights; however, as the Postal Service observes, 
the purpose of a part 3017 docket is not to facilitate an adversarial 
proceeding, but rather to provide an opportunity for commenters to 
provide input on how the views should be developed. This can be 
accomplished without reply comments. As such, the Commission does not 
plan to provide an opportunity for reply comments in the ordinary 
course of a part 3017 docket.

H. Section 3017.5--Commission Discretion

    Proposed rule. Proposed rule 3017.5 states that the Commission will 
review timely filed comments prior to submitting its views to the 
Secretary of State.
    Commenter's position. FedEx asserts that proposed Sec.  3017.5 
overstates the Commission's discretion. FedEx Comments at 14. It 
asserts that the Commission's discretion with respect to its review of 
comments is limited by the APA and principles of administrative law and 
draws an analogy to the Commission's review of domestic rates. Id. 
FedEx suggests that proposed Sec.  3017.5 be deleted. Id.
    Commission analysis. As explained in section IV.B supra, Commission 
views are not subject to the requirements of 5 U.S.C. 553. As such, the 
Commission is not required to follow the APA's notice and comment 
requirements prior to submitting its views. Despite no legal 
requirement that it do so, the Commission is creating a new part 3017 
to allow for increased public input and transparency into the 
development of its views pursuant to 39 U.S.C. 407(c). Proposed Sec.  
3017.5 is intended to place the public on notice that comments 
submitted in response to a part 3017 solicitation will be reviewed by 
the Commission, and that the review will be limited to timely filed 
comments. Limiting review to timely filed comments is consistent with 
the necessity that an opportunity to provide comments in a part 3017 
docket does not hinder the Commission's ability to submit its views to 
the Secretary of State in a timely manner. However, the Commission 
concludes that it would be useful to clarify that comments must not 
only be timely filed, but filed in response to a Commission 
solicitation under this part.
    The Commission adopts proposed Sec.  3017.5 as a final rule, with 
minor revisions to the caption and text for clarity.

I. Publication of Views in the Federal Register

    Commenter's position. UPS proposes that the Commission publish its 
views in the Federal Register when the views are sent to the Department 
of State. Corrected UPS Reply Comments at 6. It asserts that publishing 
the Commission's views engenders greater public confidence that the 
objectives of 39 U.S.C. 3622 and 39 U.S.C. 407 are being followed, 
increases transparency, and encourages participation in part 3017 
dockets. Id. at 7-8.
    Commission analysis. As indicated in Sec.  3017.3(b), the 
Commission intends to post its views in the docket with which it is 
associated after conclusion of deliberations on a related treaty, 
convention, or amendment. The Commission believes that posting its 
views on the agency Web site will address UPS's concerns.

V. Ordering Paragraphs

    It is ordered:
    1. The Commission adopts 39 CFR part 3017 as a final rule, 
effective 30 days following publication in the Federal Register.
    2. The Secretary shall arrange for publication of this Order in the 
Federal Register.

List of Subjects in 39 CFR Part 3017

    Administrative practice and procedure, International agreements, 
Postal Service.


0
For the reasons discussed in the preamble, the Commission amends 
chapter III of title 39 of the Code of Federal Regulations by adding 
part 3017 to read as follows:

PART 3017--PROCEDURES RELATED TO COMMISSION VIEWS

Sec.
3017.1 Definitions in this part.
3017.2 Purpose.
3017.3 Establishment and scope of docket.
3017.4 Comment deadline(s).
3017.5 Commission discretion as to treatment of comments.

    Authority:  39 U.S.C. 407; 503.


Sec.  3017.1  Definitions in this part.

    (a) Modern rate regulation refers to the standards and criteria the 
Commission has established pursuant to 39 U.S.C. 3622.
    (b) Views refers to the opinion the Commission provides to the 
Secretary of State pursuant to 39 U.S.C. 407(c)(1) on the consistency 
with modern rate regulation of a proposed treaty, convention, or 
amendment that establishes a market dominant rate or classification.


Sec.  3017.2  Purpose.

    The rules in this part are intended to facilitate public 
participation in, and promote the transparency of, the development of 
Commission views.


Sec.  3017.3  Establishment and scope of docket.

    (a) On or about 150 days before a Universal Postal Union Congress 
convenes or such advance time as the Commission determines for any 
other 39

[[Page 878]]

U.S.C. 407(c)(1) matter, the Commission will establish a docket to 
solicit comments on the general principles that should guide the 
Commission's development of views on relevant proposals, in a general 
way, and on specific relevant proposals, if the Commission is able to 
make these available.
    (b) The docket established pursuant to paragraph (a) of this 
section may also include matters related to development of the 
Commission's views, such as the availability of relevant proposals, 
Commission views, other documents, or related actions.
    (c) The Commission shall arrange for publication in the Federal 
Register of the notice establishing each docket authorized under this 
part.


Sec.  3017.4  Comment deadline(s).

    (a) The Commission shall establish a deadline for comments upon 
establishment of the docket that is consistent with timely submission 
of the Commission's views to the Secretary of State. The Commission may 
establish other deadlines for comments as appropriate.
    (b) The Commission may suspend or forego solicitation of comments 
if it determines that such solicitation is not consistent with timely 
submission of Commission views to the Secretary of State.


Sec.  3017.5  Commission discretion as to treatment of comments.

    The Commission will review timely filed comments responding to a 
Commission solicitation under this part prior to submitting its views 
to the Secretary of State.

    By the Commission.
Stacy L. Ruble,
Secretary.
[FR Doc. 2016-36 Filed 1-7-16; 8:45 am]
 BILLING CODE 7710-FW-P