Stop subsidising Chinese post via United Nations Universal Postal Union (UPU) terminal dues.

Chinese sellers are being offered hugely subsidised postal services known as “Terminal Dues” by the United Nation’s Universal Postal Union (UPU) allowing Chinese retailers to sell goods including postage from China to the UK for less than the stamp would cost a UK retailer to send the same item from the UK.

UPU class China, the second biggest economy in the world, as a Category 3 Economy along side Gabon. This entitles Chinese online retailers huge international postal discounts. Packages can be sent to the UK for as little as 20p. And it’s the UK mail service who picks up the tab.

In 2013 Chinese online sales reached $314 billion, or 35 percent of all world e-commerce sales (by comparison, U.S. online sales were $255 billion).

We took a look at a set of football shin pads on eBay that can be purchased for as little as £1.50 including express delivery from China to the UK. They will also be VAT Free under LVCR.

To send the same football shin pads from the UK would cost £2.58 for a Royal Mail 2nd Class package stamp. If a UK retailer sold the shin pads for £1+VAT plus delivery the total cost would be £3.78. That is more than 2.5 times the price the Chinese seller is able to sell the same product to the same UK consumer.

When the Chinese packaging enters the mail system in the UK it is handled like any other package and it is costing the UK Postal Service of tens of £millions each year, which translates into costs for U.K consumers.

It not only disadvantages UK retailers in their competition with Chinese Retailers, it costs the U.K government millions of pounds in lost customs revenue.

The UK government must stop the United Nation’s Universal Postal Union (UPU) “Terminal Dues” subsides for Chinese Online Retailers.

References:

1) Crisis in The Mail: Fixing A Broken International Package System – Analysis:

http://www.eurasiareview.com/03032017-crisis-in-the-mail-fixing-a-broken-international-package-system-analysis/

2) Stop Subsidizing Foreign Postal Systems, for Economic Fairness and National Security:

http://www.nationalreview.com/article/439532/us-postal-service-subsidizes-china-other-countries-it-shouldnt

3) The United Nations is helping subsidize Chinese shipping. Here’s how:

http://fortune.com/2015/03/11/united-nations-subsidy-chinese-shipping/

4) Your Chance to Weigh in on Low Postal Rates for China Sellers:

http://www.ecommercebytes.com/cab/abn/y16/m07/i20/s01

5) Universal Postal Union (UPU):

http://www.upu.int/en.html