The UPU remuneration systems for international postal exchanges compensate for the costs of delivery between the postal operators of the sending and destination countries; as such, they represent an important source of revenue for designated postal operators. These constantly evolving systems are the result of carefully negotiated agreement between the governments of the UPU's 192 member countries, striking a balance between market-based evidence and principles such as affordability, cost coverage and levels of development.
Terminal dues base rates and other terminal dues payments compensate the designated operator of destination for the handling, transportation and delivery of all letter-post items, including small and large letters (P/G format), bulky letters and small packets (E format) and registered, insured and tracked delivery items.
Through the remuneration systems for parcels (the inward land rate system and ECOMPRO rate system), the designated operator of the destination country is compensated for the costs associated with the handling, transportation and delivery of the international parcel-post items it receives from abroad.
Transit charges compensate for mail exchanged between designated operators through a third country. Transit charges are paid by the designated operator of the origin country to the designated operator in the intermediary country for its forwarding of mail to the destination country.
Through the different pay-for-performance agreements, designated operators link the remuneration they receive to the quality of service and additional service features provided, such as tracking of their inbound letter-post and parcel-post items.
The proposals to amend the remuneration systems presented at each Congress are the subject of long and intense studies and negotiations which result in compromise proposals reflecting the divergent interests and policy objectives and taking account of the market needs and levels of economic and postal development of the different UPU member countries.
The development of remuneration systems is supported by studies and publications by the International Bureau on various related topics such as market, financial and operational impacts, domestic tariffs, costs, mail flows and composition of mails, as well as regulatory and governance issues.