U.S. Postal Service:

Unresolved Issues in the International Mail Market

GGD-96-51: Published: Mar 11, 1996. Publicly Released: Mar 11, 1996.

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Pursuant to a congressional request, GAO reviewed the Postal Service's (USPS) participation in the international mail market, focusing on: (1) USPS responsibility for delivering and receiving international mail; (2) the competition for international mail delivery and USPS plans to increase its competitiveness; (3) legal or regulatory issues arising out of the competition in international mail services.

GAO found that: (1) USPS and other Universal Postal Union (UPU) members provide a worldwide mail delivery network even to remote locations; (2) USPS is concerned that it is losing international mail market share to private carriers whose services are more dependable, faster, and cheaper than USPS service; (3) some foreign postal services also compete in the United States for certain outbound international bulk business mail; (4) USPS has developed an aggressive strategy to regain market share that includes new services, service improvements, and market-based prices; (5) USPS officials believe that the statutory requirement that it use U.S. flag carriers at Department of Transportation-set rates limits its ability to compete for international mail; (6) competitors believe that USPS unfairly benefits from its federal status, exclusive access to foreign postal administrations, and status as the sole U.S. UPU representative; (7) competitors believe that certain USPS pricing practices violate laws and regulations and the Postal Rate Commission should set international mail rates just as it does domestic rates; (8) although competitors believe that USPS status as the sole UPU representative is unconstitutional, USPS believes it is justified by its statutory and treaty obligations that are not shared by its domestic competitors; and (9) the USPS role in the international mail market is similar to the issues surrounding USPS competitiveness in the domestic market.

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