How China-sourcing sellers should be prepared for UPU new agreement

September 25, 2019, member countries attending Universal Postal Union’s third extraordinary congress reached an agreement on international remuneration rates.

The postal remuneration system, also known as the terminal dues system, ensures that Posts are compensated for the cost of handling, transporting and delivering bulky letters and small packets across borders. Member countries agreed on the current system during the 2016 Universal Postal Congress in Istanbul.

Under the agreed solution, starting 1 January 2021, member countries receiving a great amount of cross-border letters and packets will be allowed to claim their own rates, and there will be five years to phase in.

At the same time, the UPC officials expressed that member countries (like US) meet certain requirements, including inbound letters and packets volumes in excess of 75,000 metric tons will be able to opt to self-declare their rates.

This agreement will mean a higher shipping cost for some cross-border sellers. For this news, cross-border sellers can deal with it from the following three aspects:

First of all, the international dedicated line and overseas warehousing services will be the main logistics alternative for cross-border ecommerce sellers.

Secondly, In the future, the United States customs will gradually strengthen the requirements of declaration for the parcels imported through dedicated lines. Cross-border e-commerce sellers should build their own commodity database, and maintain the Chinese and English product name (long name and short name), material, purpose, HSCODE and sales link of each product as well as possible so as to deal with the ongoing changes.

In addition, for cross-border sellers, shipping cost will no longer be an advantage over the domestic sellers. Cross-border sellers should try their best to build their own brands and innovate products to realize differentiation.

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