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

Jumbo Valley to be protected, ending decades-long dispute over proposed ski resort

Development rights permanently retired for site of proposed year-round ski resort west of Invermere

FedEx distribution centre coming to Castlegar

Development permit for ground facility before council next week.

Kootenay teams heading for curling provincials

Team Buchy and Team Nichols won the senior playdowns.

Trust delivers social grants, several in Trail and Rossland

Columbia Basin Trust supports 31 projects with $680,000 in social grants

Hospital in Trail goes from zero to 100!

Kootenay Boundary Regional Hospital is one of 4 service hospitals operating in Interior Health

VIDEO: Cold snap brings ideal conditions for Okanagan icewine

Take an inside look at how icewine is made

PHOTOS: Eastern Newfoundland reeling, search underway for missing man after blizzard

More than 70 centimetres of new snow fell overnight, creating whiteout conditions

Prince Harry, Meghan to give up ‘royal highness’ titles

‘Harry, Meghan and Archie will always be much loved members of my family,’ says Queen Elizabeth II

B.C. society calls out conservation officer after dropping off bear cub covered in ice

Ice can be seen in video matted into emaciated bear cub’s fur

Calls for dialogue as Coastal GasLink pipeline polarizes some in northern B.C.

Coastal GasLink is building the 670-kilometre pipeline from British Columbia’s northeast to Kitimat on the coast

Closed mills, housing surge support a positive forecast for lumber industries

B.C. lumber producers have closed mills accounting for 18% of province’s capacity, RBC report says

Good Samaritan pays part of rent for B.C. woman facing eviction in can-collecting dispute

Zora Hlevnjak, 76, supplements her pension by collecting cans and receiving public donations

Kelowna’s ‘Baby Mary’ finds biological parents after more than 30 years

Geneologist and DNA test helped her connect with her biological parents

Kelowna hotel to award couples for baby-making with Nooner deal

The deal includes a free stay every Valentine’s Day for the next 18 years

Most Read