POTUS Orders Postal Fee Changes That Could Crush Amazon and eBay

U.S. manufacturers, retailers and USPS suffer from deep postage discounts.

August, 27, 2018, Los Angeles, CA - The long overdue ending of deeply discounted U.S. Postal fees known as "Terminal Dues" for delivery of international mail has been ordered by President Trump. The action should severely disable Chinese counterfeiters and dishonest sellers using e-commerce websites, including eBay (EBAY), Amazon (AMZN) and Alibaba (BABA), from mailing an enormous amount of counterfeit, fake and replica goods to unsuspecting buyers in the USA.

China produces over 90% of global counterfeit goods, many of which are mailed to the U.S. from e-commerce website purchases. 80% of eBay sales and 50% of Amazon sales are from global "Marketplace" sellers, who exploit this cheap, effective way to deliver to U.S. consumers.

The decades-old arrangement, which is overseen by the Universal Postal Union ("UPU"), allows foreign postal services (and fraudulent sellers) to receive deeply discounted rates for delivery of international mail. Packages receive USPS First-Class Mail service with Delivery Confirmation Service which makes it hard for the USPS to cover costs and U.S. retailers to compete. It's cheaper to send packages from China than across the street.

The United States Postal Service Inspector General's Office reported that the USPS lost $308 million between 2010 and 2014 delivering this foreign treaty mail. In terms set out in the UPU treaty, the USPS in 2014 was paid no more than about $1.50 for delivering a one-pound package from a foreign carrier.

eBay, who claims a partnership with the U.S. Postal Service, receives a transaction fee on the overall transaction value of each eBay sale including postage, which benefits eBay, China Post and Chinese online retailers at the expense of the U.S. Postal Service and American retailers.

While the counterfeiters and e-commerce websites profit, the U.S. Postal Service loses millions.