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Diplomacy in Action

Postal Operations Council, January 2005


March 10, 2005

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United States Delegation Report
UPU Postal Operations Council
17-28 January 2005

Introduction

This report summarizes the work of the 2005 session of the UPU Postal Operations Council, held in Bern, Switzerland from January 17 to 28.


The 2005 POC session focused on examining more than 400 proposals to modify the Letter Post and Parcel Post Regulations - a job delegated by the UPU Congress - and organizing the workplans of the POC committees, boards and groups of various descriptions for the 2005-2008 period (that is, until the next Congress). Most of the work regarding the examination of proposals fell to the first of the POC's three Committees.


In the report below, you will find considerable attention paid to the workplans as well as the members and chairs of the many project groups, subgroups, boards and teams formed or elected at this 2005 POC. The U.S. joined several groups in subject areas - such as terminal dues, service performance measurement and UPU reform - to which our government assigns a high priority.


Other POC decisions or actions of importance to the United States were the following:


  • The POC declined to elevate the target for terminal dues quality link even a single percentage point to 86%. The target remained at 85% on-time delivery.

     

  • The Board of Trustees of the UPU's Quality of Service Fund announced plans to draft proposals to revise the Fund's three major documents: the Deed of Trust; the Project Management Manual and the Financial Management Manual. The Trustees also signaled their intention to simplify procedures for submission of project proposals.

     

  • In several presentations, USPS operations experts explained the benefits of a new USPS program to introduce incentives for airlines that transmit scanned data on dispatches of outbound international mail. It is thought that the USPS program might jump-start long-awaited UPU efforts to measure the performance of airlines in handling and transporting international dispatches.

     

  • Of thirteen proposals submitted by the U.S., the POC adopted eleven and referred the remaining two for study. The successful U.S. proposals concerned mandatory use of barcodes on parcels (in the sense that liability arrangements do not apply to parcels without standard UPU barcodes); use of a universal mail bag; statistics and accounting procedures; regulations governing inquiries; and confirmation of receipt, through EDI messages, of preadvised letter and parcel dispatches.

     

  • A U.S. proposal to accelerate lifting of the prohibition against mailing fruit flies (of the genus drosophila melanogaster) across national borders was adopted. Starting May 1 of this year, biomedical researchers worldwide can legally mail these flies that are used for critical research on the genetic causes of major human diseases.

     

  • The U.S. delegation stressed the need for POC groups to develop of quantifiable goals and measurements for the work they plan to undertake over the next four years as well as on the importance of setting priorities and operating within a zero nominal growth (ZNG) budget of 74 million Swiss Francs for 2005-2006. At his first full session as POC Chairman, Jim Wade of USPS reinforced these themes of budget disciplines and concrete, measurable goals in presentations he gave in Plenary and at meetings of a number of POC groups. In these presentations, Wade instructed the Chairs of every POC group to draft an "outcome statement" describing specifically the goals the group plans to achieve, the funding required and how success is to be measured. These individual plans will be rolled up into a comprehensive POC outcomes statement to be used to set POC priorities and make funding decisions. Such ambitious planning and budgetary discipline is new to the POC.

     

  •  A Council of Administration working group on the "structure and constituency of the Union" held an initial brainstorming session which drew out a wide range of views on a future direction for further structural reform of the UPU.

     

  • The EMS Cooperative elected an Israeli postal manager to its seven-person Board.

The U.S. delegation was led by Donald Booth, Director of the Office of Technical Specialized Agencies of the Department of State's Bureau of International Organization Affairs. Other members of the delegation included Department of State officials Dennis Delehanty and Heather Von Behren; U.S. Postal Rate Commissioner Ruth Goldway; U.S. Chief Postal Inspector Lee Heath; USPS Senior Vice President for Intelligent Mail Charles Bravo; USPS Vice President for International Business and POC Chairman Jim Wade; and Mike Regan, Lea Emerson, William Alvis, all of USPS. Several U.S. private sector representatives attended the POC meetings in their capacity as members of the UPU's new Consultative Committee that was established at the September 2004 Bucharest Congress. In all, 715 delegates from 89 countries attended the POC.

Committee 1: Standards and Procedures


The center of attention of this first post-Congress POC session was the work of Committee 1, which faced the task of examining and deciding upon nearly 400 proposals to amend the UPU's Letter Post and Parcel Post Regulations. The POC adopted nearly all those proposals that affect U.S. interests. The following were among the several proposals submitted by the United States: 

  • A proposal to deny liability for parcels that do not carry the 13-character item barcodes specified in UPU standard S10. (In Plenary, a well-timed U.S. intervention defeated an appeal that would have granted Germany the right to apply liability arrangements for parcels without UPU-standard barcodes. Both decisions were important victories for the use of standardized UPU barcodes on international mail items.)

     

  • A proposal to free postal administrations from the obligation of using mailbags of the specific colors as long as the bag labels correctly identify the category of mail within. (This apparently minor decision can bring major savings on equipment purchases and operational costs to the USPS and other postal administrations.)

     

  • A proposal indicating the need for electronic preadvice (through UPU-standard EDI messages), 29-character UPU-standards barcodes on receptacles, and electronic confirmation of receipt for international mail dispatches on bilateral links where exported volumes exceed 100 tons annually. (This decision will bring major cost savings to postal administrations that are capable of transmitting these EDI messages.)

     

  • A proposal to allow administrations to use printouts generated by computer systems, rather than the manual system of checking paper forms, to confirm the receipt of international mail dispatches at destination exchange office (which should also produce important cost savings at exchange offices).

On the issue of inward land rates (the rates analogous to terminal dues for parcels), the U.S. delegation fared less well. The Bucharest Congress had decided to transfer authority to set inward land rates from individual postal administrations to the POC. Under this decision, all administrations' inward land rates for 2006 would be based on their individual 2003 rates, then reduced to 71.4% of those rates, with an adjustment for inflation. Destination administrations would be eligible for supplementary payments of up to 40% of the 71.4%, based on the provision of five service features: tracking data; home delivery; liability; signature on delivery, and publication of delivery standards. If an administration provides all five features, it therefore would receive 100% of its 2003 rates.

This Congress decision and POC proposal on parcel rates caused serious concern for the United States for several reasons. First, capping inward land rates may mean that the costs of handling and delivery of inbound international parcels in the U.S. will not be covered. Second, doubts remain whether the UPU's International Bureau (IB) will be able to conduct reliable measurements on administrations' application of the five service features. Third, while the UPU has adopted the goal of aligning terminal dues rates for letter post more closely to domestic postage rates and ultimately to costs, the UPU seems to be moving in the opposite direction for inward land rates by concentrating decision-making authority within the POC and blocking any reference to the real costs incurred by administrations in handling and delivering parcels.


The POC nevertheless approved the details of the Bucharest Congress proposal on inward land rates with one important adjustment: rather than referencing the rates in force in 2003, the POC decided to set 2004 rates as the base for calculating 2006 rates. These rates would be further adjusted for inflation and the information in the report cards on provision of the five service features.


Committee 1, chaired expertly by Isabel Tavares of Portugal, completed its ambitious agenda on time, an impressive accomplishment in itself.



Standards Board


The work of Committee 1 also encompasses the Standards Board and its ancillary groups. Under the leadership of Charles Bravo of USPS, the Standards Board approved:

  • A revised XML-based standard for electronic money orders; 

     

  • A standard describing the design, use and maintenance of code lists; 

     

  • Updates to a document describing how EDI messages are exchanged; and 

     

  • Creation of a World Customs Organization/UPU work group on EDI issues, which will report to the Standards Board and the WCO-UPU Contact Committee. This will be a technical support group, not a policy group.

UPU-CEN Contact Committee

The Standards Board Chairman and IB staff meet biannually with representatives of the CEN technical committee for postal standards (TC 3311) to review progress on postal standards, since CEN standards have the force of law within the European Union. The meetings have improved coordination of the work of the UPU and CEN without which there would high potential for duplication of effort -- or worse, divergent standards. At this session, the Contact Committee reached a key agreement on procedures that the UPU and CEN will follow to ensure that the standards of the two organizations are in synchronization.


IATA-UPU Group on EDI


This group, which last met in September 2000, defines and develops the messages for the exchange of data between posts and airlines for improving efficiencies and reporting on service performance. Nine postal administrations and nine airlines attended this first post-Bucharest meeting -- the equal representation being coincidental, not by design.

The meeting opened with a survey of current EDI usage by air carriers and postal administrations. USPS presented its domestic EDI requirements program for air carriers and explained how the program is expected to affect handling and transportation of international mail. The airlines raised several questions on operational, policy and contract issues. Also discussed was a USPS proposal to use an existing segment in the CARDIT message for a "transport service requirements" code which the air carriers will review.


Participants discussed the issue of handling exceptions, as well as extending the consignment status code list. IATA explained the need for the airlines to be able to identify undocumented mail receptacles, and the airlines were tasked to quantify the scope of the problem so that potential solutions may be found. IATA also proposed the use of commercial airway bills to allow easier shipment identification by airline cargo systems. The group will meet again in April 2005 in Bern.



Committee 2: Terminal Dues and Economic Issues

Over the next four years, POC Committee 2, under the chairmanship of Cuba, will focus on terminal dues; transit charges; assisting member countries to determine costs and set rates; determining the overall cost of universal service obligations; and reviewing postal statistics.


Within Committee 2, the Terminal Dues Project Group will play a major role in further developing the terminal dues system. The U.S. was selected to co-chair the Statistics and Accounting Project Team with Malaysia and will also sit on the Terminal Dues Model Project Team, including the Development of Methodologies Work Group. A new Cost Accounting Project Group in which the U.S. will participate was also formed.


Despite a passionate plea by the Consultative Committee Chairman, Charles Prescott, representing the consumers' point of view, Committee members voted by a significant margin to retain the terminal dues quality of service link performance target at 85% for 2006.

Terminal Dues Project Group

The first meeting of the POC Terminal Dues Project Group, which has 65 members and observers, took place under the chairmanship of Switzerland, with Canada as Vice-Chair. The Project Group approved its preliminary work program for the period 2005 to 2008, mainly based on Bucharest Congress Resolution C 46.


To carry out the work of the Project Group, three Project Teams of 10 to 15 members were formed which will meet three to four times a year. The Project Teams and Co-chairs are:


  • PT 1: Terminal Dues Model (Co-chairs Morocco and Belgium)

     

  • PT 2: Statistics and Accounting Project Team (Co-chairs Malaysia and the U.S.)

     

  • PT 3: Quality of Service Link to Terminal Dues (Co-chairs Brazil and Finland)

 

The Terminal Dues Model Project Team will have the following four work groups:

  • Studies (Co-chairs Canada and China) 

     

  • Development of Methodologies (Co-chairs Germany and Ghana) 

     

  • Policy Questions (Co-chairs Great Britain and India) 

     

  • Domestic Access (Co-chairs Australia and Romania)

The Project Group also considered a draft resolution for the quality of service link to terminal dues for the year 2006. This quality link began on 1 January 2005 with an 85% target to be reached by all industrialized countries except Greece and Spain. The initial version of the resolution had called for the target to increase to 86% for the year 2006, though Germany argued that the target should remain at 85% -- a motion supported by Japan and Israel. The U.S. characterized the 1% increase as a small step towards improving letter post services, and called upon the Quality of Service Link Project Team to consider setting country-specific targets (or groups of targets) in the years subsequent to 2006. Seventeen Project Group members preferred retaining the 85% target while 13 members, including the U.S., favored moving to 86%. Committee 2 subsequently endorsed the 85% target for 2006.

 

Terminal Dues Model Project Team

The co-chairs of this Project Team and its work groups will meet in Morocco in March to finalize the workplans and timelines based on the comments received. The next meeting of the entire membership of he Model Project Team will take place in May, most likely in Bern.


Stastics and Accounting Project Team

The most urgent task of this Team, which Malaysia and the U.S. (Lea Emerson and Pat Barnwell of USPS) jointly lead, is to update the Statistical and Accounting Guide to reflect all of the changes to the terminal dues system adopted by the Bucharest Congress and the January 2005 POC. The IB will keep Team members informed about timelines for publication of the Letter Post Regulations since this final version is needed for updating the Guide.

The Team's workplan includes the design and organization of regional training workshops on the new procedures for the settlement of accounts and collection of terminal dues statistics. Team members were asked to volunteer to conduct training at these workshops in their respective regions. (So far only Indonesia and Malaysia have stepped forward to organize a training workshop for the Asia-Pacific region.)


Postal Economics


At a brief meeting, the Postal Economics Project Group decided that its work over the next four years will focus on the development of postal traffic, the impact of delivery methods on costs and traffic and the economic cost of the universal service obligation.

Charles Robinson of the Postal Rate Commission will serve as the U.S. representative on the Project Group. In a discussion on postal statistics, the U.S. recommended that the group examine the relevancy of data currently used, as well as consult major mailers and members of the Consultative Committee on their perspectives in future studies. The Group will next meet in October of this year.


Committee 3: Operational Issues


Committee 3 heard status reports of its several project groups (described in the paragraphs below). At the end of the meeting, the U.S. proposed an approach for carrying out the work in Congress Resolution C 33, which calls for a comprehensive review of the operational and accounting procedures in the UPU Acts with a view to replacing paper-based postal operational and accounting processes with procedures based on EDI transmissions. The U.S. strongly recommended that this review should initially be carried out by a small team of experienced postal experts, from perhaps three countries. Later, the POC may wish to create a formal working group, possibly in 2006 and 2007, to solicit a wide range of views if member countries on the findings and recommendations of the team of experts. The Committee approved the approach recommended by the U.S.

 

Addressing Project Group

The Addressing Project Group confirmed the formation of a subgroup on postcode promotion and improvement to be chaired by France, and a subgroup on international address components to be chaired by the U.S. (Ruth Jones of USPS). The main objective of the latter will be to finalize UPU standard S42 which will enable automatic drafting of addresses in compliance with national standards.

 

Customs Support Project Group


This Group, chaired by the Netherlands, surveyed issues related to postal implementation of the new CN 22 and CN 23 customs declaration forms, and considered recommendations to improve compliance in provision of customs information, such as the Harmonized System codes.

Participants heard an extensive briefing on EU issues focusing on development of a modernized customs code. The Group also reviewed the current status of security measures already undertaken or under consideration by customs and other agencies such as the FDA, and proposed reaction by postal administrations. Of particular interest were proposed EU requirements for electronic pre-advice similar to, but more demanding than, those recommended in the U.S. Trade Act of 2002.


Postal members of the WCO-UPU Contact Committee

At a meeting on January 26, the postal members of the World Customs Organization-UPU Contact Committee developed the following recommended agenda items for inclusion on the agenda of the April 2005 meeting of the WCO-UPU Contact Committee:

  • Evaluation of security trends in the field of customs and their impact on the postal sector;

     

  • Development and testing of systems for EDI exchanges between postal administrations of interest to customs authorities;

     

  • Roles of senders, postal administrations and customs in achieving greater compliance in the provision of customs information;

     

  • Improved cooperation between postal and customs authorities.

Participants discussed how postal administrations and customs might develop a common approach for customs security and informational requirements worldwide.

Liability Project Group

The Liability Project Group met to organize its work program over the next four years. . In the wake of a decision by Committee 1 to refer more than thirty Bucharest Congress proposals concerning claims and indemnities to the Group, work was divided into six newly-formed subgroups responsible for legal issues, registered items, payment of indemnity and reimbursement, claims, timeframes and evaluation of the proposals referred to the Group. The U.S. joined the subgroups on claims and timeframes.

Quality of Service Project Group


The Quality of Service Project Group nominated Sweden as its Chair and formed a Steering Committee composed of Brazil, Korea, Portugal, Russia and Sweden. A majority of the activities in the workplan of the Group will focus on the following four areas:

  • Quality monitoring to support the link between quality of service and terminal dues; 

     

  • Promotion of greater awareness of quality of service through seminars, for example during the 2006 POC session, and development of a Quality of Service website; 

     

  • Continued organization of quality of service missions for 2005-2006; 

     

  • Review of the methodology employed to certify postal administrations in the quality management field.

Of special interest to the U.S. was the creation of a "Terminal Dues Quality Link Monitoring Systems Subgroup", chaired by Germany, that intends to work quickly to ensure that data collected for the purpose of linking quality and terminal dues payments and the accompanying measurement systems are valid. In particular, this subgroup will address the issue of deployment of customs gates for performance measurement purposes.

Committee 4: Markets

This Committee's mission is to satisfy customer needs by broadening knowledge of markets and facilitating their development. The Committee formed, or reinstituted, the following five bodies:


  • Direct Mail Advisory Board;

     

  • World Association for the Development of Philately;

     

  • Publishing Industry Group;

     

  • Research and Marketing Development Group;

     

  • Customer Relations Group.

An Executive Board composed of the Chairs of these five bodies, plus representatives of selected POC and regional groups and the Chairman of the Consultative Committee, will coordinate the Committee's work.

The first three bodies held their first meetings during the POC and presented action plans approved by their members during these meetings. The Research and Marketing Development Group and the Customer Relations Group will have their first meeting in October 2005, and their action plans are only tentative. Presenting a summary of UPU budgetary resources allocated to Committee 4 for the period of 2005-2008, the Chairman noted that additional funds will be required from extraordinary sources. The final budget for Committee 4 will be decided at the October 2005 CA.



Direct Mail Advisory Board


The Direct Mail Advisory Board adopted its Development Plan for 2005-2008 which will focus on six main lines of work: information, education and training, networking and benchmarking, measurement tools and standards, communications and interaction with other groups within or outside the UPU.

The DMAB adopted the Chairman's proposal to add two additional Vice-Chairs, that is, Russia for the postal side and Gene del Polito of POSTCOM for the private sector. The DMAB Steering Committee will be composed of the DMAB Chair and three Vice-Chairs. On the Steering Committee China, Italy, New Zealand, Tunisia and the U.S. will serve as postal members while the Direct Marketing Association, the Buhrs Group and POSTCOM will serve as members from the private sector.


Action Groups

Postal Development Action Group

The PDAG Planning Team met twice during the POC session to consider workplans for the next four years. Among the items discussed were performance indicators for reform projects, twinning projects, involvement of Regional Advisors in PDAG work, and responsibility for the feasibility study for transforming the Quality of Service Fund into a postal investment bank. The feasibility study was assigned to representatives from Belgium, France, Spain and the U.S., with the U.S. as Chair.


Postal Security Action GroupThe Postal Security Action Group, chaired by USPS Chief Postal Inspector Lee Heath, discussed the structure, direction of work and future focus of PSAG in light of a member survey distributed in December 2004 aimed at evaluating PSAG activities. The meeting also featured presentations on electronic data interchange messaging between posts and airlines, fraudulent attacks on the postal money order system and a new security "code of conduct". PSAG membership now stands at 74 countries.

POC Groups

Electronic Products and Services Group

The newly-created Electronic Products and Services Group (EPSG) will concentrate on UPU policies, regulations and standards regarding new electronic services, or eServices. While the Telematics Cooperative's Advanced Electronic Services User Group will continue to focus on product development and operational functions, the EPSG will seek strategic market development opportunities where regulations are applicable and develop a higher level workplan in line with the growing importance members now place on eServices. Specifically, the work of the EPSG will include:

  • Research and strategy recommendations to the POC;

     

  • Product and service specifications;

     

  • International operating models and service standards;

     

  • Operating policy and regulations;

     

  • Financial models, pricing policy and enabling multilateral agreements.

The EPSG terms of reference also include working with governments and postal administrations on strategy, specifications, standards, policy and market development; seeking input from innovators and early adopter posts as subject experts; and developing a strategy for the second phase of the World Summit on the Information Society (WSIS) in Tunisia in November 2005 to maximize exposure for the postal industry.

The Group's five project teams formed at the meeting will address a WSIS telekiosk and regulatory and policy issues; EPM; the .post top level domain; electronic shopping; and hybrid mail. The U.S. showed an interest in joining the .post and hybrid mail project teams.


Parcels Group

In presenting his vision and terms of reference for this group, Chairman Gary Simpson of Great Britain stressed that members must make clear progress in the next 18 months to forestall further decline in parcel traffic. The meeting then dealt with the formation of the definition of subgroups concerning the five following areas: management, services, product definition, accounting and development.


Each of these groups will draft a workplan by June 2005 when the Steering Committee -- composed of the Chairs of these subgroups -- will meet to review progress. The U.S. (Brian Hutchins of USPS) will chair the Services Subgroup and thus serve on the Steering Committee. The Services Subgroup will be responsible for increasing the use of bar codes on international parcels, the transmission of electronic tracking information and developing performance measurement systems for parcels.



Quality of Service Fund Board of Trustees

 

The Quality of Service Fund (QSF) Board of Trustees held its quarterly meeting under the Chairmanship of Mr. Ramachandran Ganesan, the Director General of Posts of India. The Board is composed of representatives of the following nine countries elected by the POC: Brazil, Burkina Faso, France, India, Japan, Kenya, Portugal, Russia and the United States. Dennis Delehanty of the Department of State represents the U.S. on the Board.

 

As this was its first meeting since the Bucharest Congress, the Board reviewed Congress resolution C 8 which, among other decisions, instructed the Board to draft updated versions of the Deed of Trust, the Project Management Manual and the Financial Management Manual. The Board adopted a plan and calendar to produce draft documents for presentation to the POC Management Committee in October.

 

A recent IB survey showed that postal administrations continue to regard most information related to QSF accounts as confidential. One exception is the amount of funding spent on each individual project approved. This information will be henceforth included in future Board reports to the POC.

 

The Board further discussed how it might better communicate information about its work and the challenges it faces to the wider UPU community. At its next meetings in Tokyo in April and New Delhi in July the Board will explore recommendations for such a communications plan, including the suggestion to hold informal, non-decisional workshops and briefing meetings for delegates attending the POC and CA sessions in Bern.

 

The Board gave provisional approval to dozens of projects pending the receipt of information missing from project proposals. The pace of submission of project proposals is quickening as administrations become more familiar with the mechanics of submitting proposals. Since 2001, the Board has approved projects totaling about $26 million.

 

Lastly, the Board initiated discussions on developing global indicators by which the concrete effects of QSF projects on a postal administration's overall quality of service could be measured. These indicators might include, for example, the quality of service reports currently issued by the UPU or the UPU's planned service performance report cards.

User Groups

EMS Cooperative

The EMS Cooperative General Assembly took up a number of issues related to the budget approval process, as well as minor changes to the statutes and EMS Pay-for-performance plan. Elections for three Board positions were held during the Cooperative. Wendy Eitan of Israel and Patrick Lin of Hong Kong were elected as new Board members while Fabio Cesar Vieira of Brazil retained his seat.


The main topic of discussion was the EMS Business Plan for 2005 to 2008. The business plan segmented the members of the Cooperative into three groups: the largest importers; those with tracking capability; and those with no tracking. The three groups were given separate timelines to attain specific performance goals. These performance goals will be tracked for each administration in each group, and the present report cards will adjusted accordingly.

Telematics Cooperative 

The Telematics Cooperative General Assembly elected Chris Grosser of Australia as Management Board Chairman while Abdeljalil Azzane of Morocco was elected Vice-Chairman. A position on the Board -- that of Vice-Chair for legal affairs -- remains open.

Reviewing the Cooperative's business plan for 2005-2008, the Board committed to providing a more detailed plan no later than the extraordinary General Assembly scheduled for October 2005. The Board also expressed continued strong commitment to recovering debts from members.


During a discussion on Cooperative finances, U.S. representatives insisted on more transparency and details on the activities of the Postal Technology Centre (PTC). Specifically, the U.S. delegation requested more information on the number of PTC staff members assigned to each program, and how much is spent per program. The Board indicated that this detailed information will be provided in future Telematics Cooperative budget documents. It was also reported that contributions from the UPU General Budget to the Telematics Cooperative will be reduced to 500,000 Swiss francs in 2005, and further to 350,000 Swiss francs in 2006. Dealing with this reduced funding from the UPU budget is the primary reason for convening the extraordinary General Assembly in October 2005.

The Cooperative's three user groups -- which handle advanced electronic services, international financial services and international mail services -- offer research, development and operational services to their members.



International Mail Services User Group

This User Group strives to provide software solutions for integrated international mail management, combining mail processing, operational management, and EDI messaging. A meeting of this User Group in Bern provided information on the following:


  • Operation of the Regional Support Centers;

     

  • License fees, network costs, POST*Net message counts;

     

  • Highlights of the differences between IPS (many features) and IPS Light (fewer features);

     

  • New Portable Scanning Devices for mobile scanning;

     

  • New Quality Control System focusing on item-level statistics.

Members concurred that the Group's priorities shall be Portable Scanning Devices and introducing customer item information into the IPS Light application.

Advanced Electronic Services User Group

This User Group focuses on development of electronic postal commerce to facilitate development of standards and foster innovation of new ideas. Current User Group projects include the .post top level domain, Electronic Post Mark, hybrid mail, Radio Frequency Identification.


At the User Group meeting, private companies gave detailed presentations on the Electronic Post Mark (EPM) at the meeting. The potential relationship of EPM with the UPU terminal dues structure is being explored. Australia, Canada, Egypt, France, Italy and Portugal plan to pilot or implement this standard in 2005 and two major private companies reportedly have expressed interest in embedding EPM into their products.


Participants heard a presentation on the .post top level domain, the Cooperative's application for ICANN approved in 2004. There is significant legal and policy work required, but postal administrations recognize that they have a unique opportunity in obtaining rights to this top level domain. Highlights of the .post presentation included a conceptual discussion of a unique identity linked to physical addresses at the national level for users, international interoperability, and enabling applications on .post to serve as a single global platform.


Other priority activities include hybrid mail and RFID (Radio Frequency Identification). The desired result is to establish a single international standard for hybrid mail. Although RFID was initially viewed for identification purposes, further benefits have emerged related to trackability of waste, theft, transportation and logistical management. The User Group will initiate work on the development of standards for hybrid mail and undertake a market survey to identify needs and uses for RFID.



Council of Administration Project Groups

Acts of the Union Project Group

The Acts of the Union Project Group nominated the U.S. (Bill Alvis of USPS) as its Chair and adopted the Group's work plan for the Bucharest cycle. Most activities in the workplan involve the following objectives:

  • Study of the use of the term "postal administration" within the context of the Acts;

     

  • Study of the UPU reservation system and define the term "reservation";

     

  • Development of a formal legislative drafting guide.

The Project Group agreed to begin work immediately on the use of the term "postal administration" by drafting reflection documents on possible alternatives. At its next meeting, the Group will discuss the reflection documents and the IB's draft Acts of the Union using the terms "member country" and "operator". The Group also reviewed the results of a questionnaire on replacing the term "postal administration" carried out in February 2004 by the earlier Acts of the Union Project Group.

The IB will initiate the work on the UPU system of reservations and provide an analysis of the use of reservations by the next meeting. The Project Group agreed to delay the work on the legislative guide until member countries could better determine their availability to participate in the work. The Group will next meet in May of this year.


Strategic Planning Group


Under the leadership of the Russia, the Group adopted its work plan for the Bucharest cycle and approved the schedule for finalizing the UPU Program and Budget 2005-2006. The Group also expressed support for aligning the objectives outlined in the UPU Program and Budget with the Bucharest World Postal Strategy, as presented by the POC Chairman and adopted by the CA and POC Management Committees.


To carry out the work of the project group, four subgroups were formed. The subgroups, chairs and primary objectives are outlined below:


  • SG 1 (Chair: France): implementation of results-based budgeting and management and the prioritization and assessment of the UPU Program and Budget and the Bucharest World Postal Strategy

     

  • SG 2 (Chair: U.S.): development of scenarios for the future of the postal industry

     

  • SG 3 (Chair: Russian Federation): arrangements for the 2006 strategic conference and communicating with stakeholders

     

  • SG 4 (Chair: Belgium): development of the Nairobi World Postal Strategy

The Chair proposed scheduling the next meeting during the St. Petersburg symposium in the Russian Federation in June 2005, to review the tasks and timetables of the subgroups. However, the Group did not make a final decision as to the date and location of the next meeting.

Structure and Constituency of the Union Project Group


This new Project Group convened a full-day brainstorming session to elicit ideas for further reform of the Union as outlined in Bucharest Congress C 54. A principal concept put forward for consideration in this resolution is the suggestion for transforming the Postal Operations Council into a Postal Operators Council which would foster more commercial arrangements, for example, commercial contracts between postal operators rather than formal inter-governmental agreements.


The Chair of the Project Group, Germany, had arranged for a consultant company to give wide-ranging presentations on the conceptual, practical and legal issues related to further reform of the UPU. These presentation drew out five major issues regarding reform that the Project Group will confront in its work over the next four years, namely definition of responsibilities of governments and operators; legal status of operator agreements, including possible voluntary agreements; composition of the Postal Operations (or Operators) Council; principles and procedures related to voting rights; and financing of the UPU.


A discussion ensued on these five topics which also touched upon the mission of the UPU and its overall structure as well as the specific roles of the CA and POC. A wide range of views were heard, which reflects the greatly varying legal structures for postal policies and operations among UPU member countries. Of note was a new mood reflected in the interventions of several participants who expressed support for alternative voting principles that might move a new POC structure away from the one-country one-vote structures towards more proportional voting systems. One or two delegations, however, expressed caution in this regard. A further challenge will be to reach agreement on a reformed or revised UPU organization that reconciles the legal structures of those countries that have adopted a clear distinction between operational and regulatory functions (such as many governments in Europe) and those that have made no such clear distinction or have not established a regulatory agency governing postal markets.


WTO Relations Project Group

During the first meeting of the WTO Relations Project Group, the Group adopted its workplan, which focuses on four main objectives:


  • Monitor international law in the field of trade in services; 

     

  • Establish a WTO-UPU Memorandum of Understanding; 

     

  • Study the proposals submitted to the WTO concerning the classification of postal services and courier services and identify their impact on the UPU; and 

     

  • Obtain observer status in the WTO for the UPU.

The Group also listened to presentations delivered by the European Community, Japan, Mercosur and Bolivia, New Zealand, and the United States explaining their current offers to the WTO and updating the group on the latest developments within the WTO concerning classification of postal and courier services. The IB will conduct a study of the proposals submitted to the WTO and present the results to the Group by March 2005 and the CA in October 2005.

Annex 1

 

Glossary of abbreviations and terms

 

Abbreviation or term

Full name or explanation

 

 

CA

Council of Administration

CEN

European Committee for Standardisation

CN

A series of forms in the UPU Convention for use in international postal operations, such as Form "CN 38 Delivery Bill.Airmail". The letters "CN" refer to "Convention".

CPC

Central Product Classification

DMAB

Direct Mail Advisory Board

EDI

Electronic Data Interchange

EMS

Express Mail Service

EPM

Electronic Post Mark

EPSG

Electronic Products and Services Group

GATS

General Agreement on Trade in Services

IATA

International Air Transport Association

IB

International Bureau (the UPU secretariat in Bern, Switzerland)

IATA

International Air Transport Association

PDAG

Postal Development Action Group

POC

Postal Operations Council

PSAG

Postal Security Action Group

PTC

Postal Technology Centre

QSF

Quality of Service Fund

RFID

Radio Frequency Identification

SDR

Special Drawing Right

WTO

World Trade Organization

XML

Extensible Markup Language (format for the exchange of
electronic data)



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