U.S. postal treaty exit would hurt Canadian e-commerce businesses

U.S. threaten to exit Universal Postal Union in October unless more balanced shipping fees reached

U.S. President Donald Trump’s push to withdraw from an international postal treaty could have a big impact on Canadian e-commerce companies and their American customers.

The U.S. threat to exit the Universal Postal Union in October unless more balanced shipping fees with China and other countries can be reached this month means online retailers could see direct-to-consumer delivery prices shoot up.

The 145-year-old treaty, which sets the rates that nearly 200 national postal services pay one another to complete deliveries, mandates wealthier countries to pay more than developing countries, including China.

READ MORE: CryptoKitties — Are blockchain Beanie Babies the future of e-commerce or a fad?

Todd Coupland, an analyst at CIBC World Markets, says the Trump administration’s move for the United States Postal Service to set its own rates would affect drop-shipping, which refers to retail deliveries made directly to the buyer from a manufacturer or wholesaler.

Many drop-shippers in Canada use Shopify Inc. as their retail platform, meaning a dip in deliveries and more shuttered online storefronts could dent Shopify’s bottom line, which relies on payment-processing fees and user subscriptions.

In an email, the U.S. Postal Service says it supports the goals of the Trump administration to secure a more balanced remuneration system for small goods shipments, and that it will not leave the postal treaty if better terms are set before the union’s next meeting in mid-October.

The Canadian Press

READ MORE: Comox Valley artisans join new local e-commerce platform

READ MORE: New e-commerce project helps market Alberni Valley growers

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Bears spotted near Saanich lake spooked by police, wandered off

Bear, cub not seen over weekend but police ask residents to be on alert

Homeless shelter at Save-On-Foods Memorial Centre creates 40 jobs

The arena can house 45 people in pop-up pods

Bike lane closed, traffic impacted by landscaping in Metchosin

Construction begins May 25, to be complete by mid-July

Victoria’s 75,000 veggie plants ready to find a home

New gardeners line-up for Get Growing Victoria

Vancouver Island hasn’t seen a new homegrown case of COVID-19 in two weeks

Island’s low and steady transmission rate chalked up to several factors

Dump truck in Nanaimo snags power lines, snaps hydro pole, crashes

No injuries in incident Monday morning on Old Victoria Road

Ferry sailings scheduled once again at Nanaimo’s Departure Bay terminal

BC Ferries announces that resumption of service June 3 includes four daily round trips

Facing changes together: Your community, your journalists

The COVID-19 pandemic has changed the world in ways that would have… Continue reading

Island Health signs working agreement to turn former Comox hospital into a ‘dementia village’

Island Health has signed a project development agreement with Providence Living to… Continue reading

Kelowna man charged with harming a hamster

The 20-year-old Kelowna man faces several animal cruelty charges

High tech fish transport system set up to ‘whoosh’ salmon past Big Bar landslide

Fish will spend roughly 20 seconds inside the system, moving at roughly 20 metres per second

Trudeau to seek 10 days of paid sick leave for Canadian workers, says talks are ongoing

Paid sick leave is key to keeping COVID-19 spread under control, prime minister says

Snowbirds jets will not be leaving Kamloops, just yet

The Snowbirds have been in Kamloops since May 17 when a plane crashed killing Capt. Jennifer Casey

Most Read