As Trump Slams China For Unfair Postal Rate Breaks, USPS Accused Of Hiding Price Deals With Chinese Shippers

A lawsuit filed against the United States Postal Service (USPS) accuses the agency of obscuring documents that could shed light on price breaks enjoyed by three linked companies. The lawsuit comes as the Trump Administration moves to withdraw from the Universal Postal Union (UPU) over an alleged lack of disclosure surrounding discounted rates for Chinese shippers.

In April, a prominent United States law firm submitted Freedom of Information Act (FOIA) requests to the United States Postal Service seeking details on Negotiated Service Agreements (NSAs) that USPS may have granted to a series of connected Chinese logistics companies — Fujian Zongteng Network Technology Co., Limited (f/k/a Fuzhou Zongteng Technology Co., Limited); Enumber, Inc.; and US Elogistics Service Corporation. The FOIA request also sought any documents outlining USPS criteria to award NSAs generally, which the USPS uses to offer customized pricing to mailers.

In response to the FOIA request, the USPS elected to withhold the requested records — and refused to confirm or deny their existence. Ultimately, the FOIA requests were denied, appealed and denied again.

One of the companies implicated in this FOIA inquiry is run by a Brooklyn-based CEO, Hangfeng Wu (a.k.a., Nick Wu), who previously paid a $700K settlement in 2014 for understating the weight of postage on large amounts of mail sent through USPS. The US District Court for the Central District of California also ordered a permanent injunction against Wu for trademark and copyright infringement. To date, Fujian Zongteng still receives funding from investors in China such as Global Logistic Properties, Fosun Capital and Eastern Bell Venture Capital.

Late last month, after the two denials by USPS, the law firm filed suit against USPS seeking to obtain the information.

The Trump administration has called for disclosure surrounding these deals, holding strong that NSAs such as those sought by the FOIA benefit Chinese companies while undercutting American competitors. Simultaneously, the USPS has gone to great lengths to keep details about its pricing for Chinese shippers out of the public realm.

The administration’s unusual move to withdraw from the UPU, a 144-year-old international body that keeps postal dealings outside of traditional intergovernmental treaties, drew support from the Washington Post Editorial Board, which wrote that the UPU has “evolved from a mechanism to promote global communication into a small but meaningful source of unfair economic advantage for China.”

The USPS, however, may be managing its own internal mechanisms to keep shipping from China cheap — and keeping those mechanisms out of sight.