Pro 1.10.2015

Deed of Trust – QSF Statutes (Approved by the 2015 POC) QSF – Quality of Service Fund New edition (May 2015)

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Quality of Service Fund (QSF) Quality of Service Fund Deed of Trust The present Deed of Trust (the "Agreement") has been entered into force in Berne (Switzerland)

between the Universal Postal Union,

as represented by the Director General of its International Bureau, in accordance with article 127 of the General Regulations of the Universal Postal Union, acting on behalf of the postal contracting States listed in the annexes hereto as countries contributing to the Quality of Service Fund (QSF) (hereinafter collectively and individually referred to as the "Settlors"), and as countries benefiting from QSF funds (hereinafter collectively and individually referred to as the "Creditors"),1

and the Board of Trustees,

in charge of the Quality of Service Fund ("QSF") of the UPU as created by the Beijing Congress, whose term was extended by the Bucharest Congress, the 24th Congress held in Geneva and the 2012 Doha Congress (hereinafter collectively and individually referred to as the "Trustees"). Whereas

– the Beijing Congress approved the terminal dues system comprising the QSF and the Bucharest Congress, the 24th Congress held in Geneva and the Doha Congress maintained this mechanism;

– the QSF is a temporary fund the sole purpose of which is to help Creditors improve the quality of the universal postal service during a transitional period, leading up to the adoption by the UPU of a new terminal dues system based on country-specific rates;

– for the period 2010–2013, the QSF will be maintained in accordance with the provisions adopted by the 24th Congress held in Geneva;2

– for the period 2014–2017, the QSF will be maintained in accordance with the provisions adopted by the Doha Congress.

The Parties agree as follows: 1 Duties of the Board of Trustees 1.1 The QSF Board of Trustees shall be responsible for:

– approval of the projects submitted by Creditors, evaluation and monitoring of projects, and all QSF expenditures;

– investment and management of trust funds through a professional fund manager or managers.

1.2 The Trustees shall be responsible for the management of the business and affairs of the Trust and shall report to the Postal Operations Council ("POC").

2 Composition of the Board of Trustees 2.1 Number of members: The Board of Trustees shall consist of nine Trustees.

2.2 Appointment of members: The Trustees shall be elected by a qualified majority of 10% of votes cast, in accordance with the geographical criteria and level of development indicated hereafter: two members shall be elected from among the countries of Western Europe, two from the countries of Africa and one from the countries of Eastern Europe. Two members shall be appointed from the

1 The QSF, including the classification of countries as "Settlors" and "Creditors", is governed by article 32 of the Universal Postal Convention adopted by the 2012 Doha Congress and by Congress resolutions C 17/2008 and C 18/2008 for the period 2010–2013, as well as C 67/2012 and C 77/2012 for the period 2014–2017. 2 In accordance with the relevant articles of the UPU Convention (Financial Management Manual, Annexes 1 to 3 for the period 2010–2013 and Annexes 4 to 6 for the period 2014–2017).

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Western Hemisphere, and two from the countries of the Asia and Pacific region. In each of these two regions, one member shall come from an industrialized country (IC) and the other from a Creditor country. In the event of a tie, a second vote shall be taken, if necessary. If the second vote does not resolve the tie, then the POC Chairman shall draw lots to determine the winner. All UPU members in good standing, as defined in article 9.1.1 , may stand for election.

2.3 Duration of the Trustees' term of office: The Trustees shall be elected by the POC for a renewable three-year term, for the term of the Trust. A Trustee's term shall begin in July following the election. One third of the Board of Trustees' membership shall be renewed each year, as from 2010. A Trustee whose country is no longer in good standing with the UPU under the terms of article 9.1.13 herein shall forfeit trustee status.

2.4 Representation: Each Trustee shall designate its representative on the Board of Trustees for the duration of its term of office. A Trustee shall not have more than two representatives during its term of office.

2.5 Vacancies: A vacancy shall arise when a Trustee declares that it is unable to carry out its duties, or if it has been unable to be represented at three consecutive meetings, or is no longer entitled to appoint a new representative. The Chairman shall fill the vacancy temporarily until the next POC in accordance with the criteria and terms indicated in § 2.2. During the next POC, elections shall be conducted in accordance with the terms of § 2.2.

3 Powers of the Trustees 3.1 The Trustees shall have sole and absolute discretion in managing and administering the Trust and the

affairs thereof. In particular, they shall have the following powers:

3.1.1 Production of a Project Management Manual: The Board of Trustees shall be empowered to produce or have produced on its behalf a Project Management Manual setting out the procedures for project approval, calls for tenders, and the monitoring and evaluation of project results. The Manual shall be submitted to the POC for approval; its provisions do not come into effect until approved by the POC. The Board of Trustees may make minor amendments to this Manual; however, amendments to certain articles4 must be submitted to the POC Management Committee and cannot be applied until approved by it. The POC Management Committee may, at its discretion, submit to the POC proposed amendments to the Project Management Manual.

3.1.2 Production of a Financial Management Manual: The Board of Trustees shall be empowered to pro-duce or have produced on its behalf a Financial Management Manual setting out the procedures for managing QSF funds. The Manual shall be submitted to the POC for approval; its provisions do not come into effect until approved by the POC. The Board of Trustees may make minor amendments to this Manual; however, amendments to certain articles5 must be submitted to the POC Management Committee and cannot be applied until approved by it. The POC Management Committee may, at its discretion, submit to the POC proposed amendments to the Financial Management Manual.

3.1.3 Approval of projects: Subject to article 7.2.2, the Board of Trustees shall be empowered to approve project applications submitted by Creditors.

3.1.4 Disbursement of funds to Creditors: The Board of Trustees shall be empowered to pay the Creditor the funds required for execution of the project once it has been approved.

3.1.5 Project follow-up: The Board of Trustees shall be empowered to inform itself about the smooth con-duct of projects and follow up all projects to ensure compliance between the project objectives and the results obtained on improving quality of service; it may take such remedial measures as it deems appropriate, in the light of all the relevant circumstances.

3.1.6 Investment management: The Board of Trustees shall have the power to invest Trust funds and man-age Trust investments.

3.1.7 Use of consultants and services: The Board of Trustees shall be empowered to use consultants or to consult any professional service provider including, but not limited to, lawyers, accountants, banks or other financial institutions, for the purposes of managing and administering the Trust. The use of such service providers shall not abrogate the responsibility of the Trustees for deciding all questions in relation to or in respect of the Trust.

3 In accordance with articles 128 and 129 of the General Regulations of the Universal Postal Union. 4 See article 2 of the QSF Project Management Manual (PMM). 5 See article 2 of the QSF Financial Management Manual (FMM).

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3.1.8 Construction: Any sound, justified construction of these provisions made in good faith by the Trustees shall be conclusive, final and binding on the parties and all Creditors.

4 Endowment of the Trust 4.1 The Trust shall be maintained in accordance with the terms laid down by the respective Congress

resolutions.

4.2 The Fund shall also be maintained by interest on investments, by interest on arrears calculated on contributions owed to the QSF and by the Settlors' discretionary contributions as defined in arti-cle 7.1.3.

5 Functioning of the Trust 5.1 Meetings of the Board of Trustees6: Meetings of the Trustees shall be held in Berne (Switzerland), or

such other location as the Trustees may agree on. The Board of Trustees shall meet up to four times a year. At least two of these meetings shall be held during the annual meetings of the Council of Administration (CA) and the POC. Unless the Board decides otherwise, the deliberations of the Board of Trustees shall be confidential, requiring the physical presence of the Trustees or their representatives. Observers shall not be admitted; however, persons with expertise relevant to the Board may be invited by the Chairman to provide advice and opinion.

5.2 Only Trustees shall have the right to vote.

5.3 Chairmanship and Vice-chairmanship of the Board of Trustees: Each year, a Chairman and a Vice-Chairman shall be elected by a simple majority of the Trustees present. The vice-chairmanship shall be held by an elected Trustee from a UPU member country of a group other than that of the Chairman. When the Chairman is from a country belonging to an industrialized country, the Vice-Chairman shall be from a country not belonging to that group, and vice versa.

5.4 Quorum: The quorum required for the holding of meetings of the Board of Trustees shall be five members.

5.5 Simple majority: Subject to the quorum requirements as set forth above, all questions submitted to the Trustees, except for the establishment of investment principles, shall be proposed and decided on the basis of a simple majority of the Trustees present. In the event of a tie, the Chairman shall have the casting vote. The establishment of investment principles shall be decided by a majority of two-thirds of the Trustees present.

5.6 Trust expenses: Subject to this Agreement, all costs or expenses incurred by the Trustees in manag-ing and administering the affairs of the Trust, whether collectively or individually, shall be borne by the Trust. At all times, the Trustees shall endeavour to keep Trust costs and expenses to a minimum. All management expenditure, as defined in the Financial Management Manual, shall be paid first from interest on investments or other profits or revenue from the Trust funds, and then from the capital, on a pro rata basis of total annual payments due to each Creditor. The Trustees shall not charge, nor shall the Trust be liable for, any travel costs or management or administrative fees in respect of the Trustees' management or administration of the Trust.

5.7 Sound investment principles: Subject to this Agreement, and with regard to such practical restrictions or requirements as may be imposed on the Trustees, Trust capital shall be managed according to sound investment principles so as to generate maximum return, whether in terms of income, capital gains or a combination of both, while maintaining an acceptable level of risk consistent with a prudent, low-risk investment strategy. Due account shall also be taken of the need to have funds readily available on approval of the projects.

5.8 Liaison: The Trustees shall use all reasonable means at their disposal to ensure that the fund is made known to designated operators and that the Creditors are aware of the balance that they have in the Trust.

6 This article came into force, with retroactive effect, on 1 January 2012 (POC 2012.2–Doc 18d).

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5.9 Trustees' obligation to report: The Trustees shall report on their activities and the status of the Trust to the POC at its annual session. The Trustees' report shall deal in particular with issues such as amendments to the QSF rules, and the nature and number of projects financed by the Trust and of the projects undertaken by Creditors, the number and status of all project applications under consideration as well as the list of Creditors that have not yet proposed projects will be indicated. At each annual POC meeting, the Trustees shall present the state of the QSF accounts.

5.10 Financial statements and External Auditor's report7: The audited QSF financial statements (consolidated in the verified financial statements of the Union), together with the report of the Union's External Auditor, shall be reviewed by the Board of Trustees and subsequently submitted by the International Bureau to the CA for approval at the end of the financial year.

5.11 The working languages of the QSF shall be French and English. 6 Liability of the Trustees 6.1 Trustees cannot be held liable for errors of judgement, omissions or acts committed in the exercise of

their functions, or for steps they may take or refrain from taking in good faith; as a general rule, a Trustee shall not be held accountable under this Agreement, except in the event of bad faith or wilful misconduct. No Trustee shall be liable in any way for any act or omission attributable to another Trustee.

6.2 Subject to the provisions of this Agreement, the Trustees shall be released from any liability in respect of their construction of this Agreement or of any decision based thereon.

7 Management of funds and projects 7.1 Fund management

7.1.1 Annual payment of contributions: Each of the Settlors shall pay its annual contribution to the QSF by the given deadlines, in accordance with the principles governing the calculation and payment of ter-minal dues. Moreover, annual settlements that are in arrears shall attract interest at the same rate and on the same terms as outstanding terminal dues. Billing conditions and contribution payment procedures shall be specified in the Financial Management Manual. Trustees shall not be obliged to pay interest to the Settlors on any amount remitted before annual payments become due and payable.

7.1.2 Where Settlors which also have the status of Creditors of the Fund fail to pay outstanding sums owed to the QSF, the sums owed shall be automatically deducted from their QSF assets.

7.1.3 Discretionary contributions: Settlors may, at their absolute discretion, donate or make payments to the Trustees in addition to the annual settlements. Payments may be made for the projects of any Creditor or for a whole region or sub-region in which the Creditors are situated.

7.1.4 Government and designated operator contribution: In principle, projects, as defined in the QSF rules (or documents), may be supported from the Trust when the designated operator or government contributes to the project with its own resources. To achieve a high degree of efficiency and com-mitment , it is desirable for each project to include active involvement by the government and/or designated operator using all means at their disposal.

7.1.5 Accumulation of payments: Each Creditor is encouraged to submit project proposals on a regular basis, utilizing its available funds. However, individual Creditors may, with the agreement of the Board of Trustees, request that the annual settlements or discretionary settlements paid into the Trust in their favour accumulate for recommended future projects during part of the term of the Trust.

7.1.6 Trust funds assigned to the Creditors: All Trust funds shall be assigned to the Creditors as soon as they are received. For each Creditor, the Trustees shall open a separate account to be credited with the annual settlement owed by Settlors. Funds assigned to a Creditor which are not used on dissolution of the Trust shall be distributed in accordance with the provisions of this Agreement governing dissolution of the Trust.

7 This article entered into force, with retroactive effect, on 1 January 2011, following the adoption of the International Public Sector Accounting Standards (IPSAS) (POC 2011.1–Doc 13a.Add 2).

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7.1.7 Conditions of payment of funds to Creditors: Notwithstanding the Creditor's vested interest in the Trust funds due to it, no Creditor shall be entitled to any payment by the Trust without the prior approval of the project for which the Creditor has requested payment. All payments made by the Trust to a Creditor for approved projects shall be for the exclusive use of the designated operator of that Creditor or its assigns, under the terms of this Agreement. Any misappropriation or misapplica-tion of such payments by a Creditor shall constitute a violation of the terms of the Trust and may result in remedial measures, in accordance with the relevant provisions set out in the perspective Agreement and supplemented by the Manuals.

7.1.8 Supplier assignment: At the Creditor's request, payment of funds allocated to a duly approved pro-ject may be assigned to a supplier of services or equipment with the consent of the Board of Trustees.

7.1.9 Assignment in favour of another creditor: A Creditor may, at its sole and absolute discretion, assign the benefit of its entitlements, in whole or in part, to fund joint projects in the same region or sub-region, or in any other region or sub-region, to finance projects involving all parties concerned. The use of these funds shall be subject to the normal project approval procedures.

7.2 Preparation, presentation and approval of projects

7.2.1 Conditions of approval of projects: Project approval shall depend on the Creditor's ability to satisfy the Trustees that, in view of the specific situation of the Creditor's postal service, the project for which approval is sought meets the criteria set out in the Project Management Manual. Projects shall be aimed primarily at improving the quality of service of creditor designated operators, particularly the quality of inbound letter-mail flows subject to terminal dues. Results must be evaluated by comparison with the previous situation, in particular with the assistance of end-to-end quality of service measurement. Creditors may join forces and design projects for the benefit of their regions or sub-regions. A region shall comprise any Restricted Union or any group of contracting member countries, and a sub-region shall comprise a group of contracting member countries situated in a particular region. Creditors may also act jointly and design global projects. A global project shall comprise the International Bureau of the UPU and a group of contracting member countries belonging to two or more regions. In principle, global projects shall form part of the action plans of the Union's bodies.

7.2.2 Project approval process

7.2.2.1 The Creditor must apply for project approval. Each Creditor shall be responsible for designing and preparing its project, as well as for the application made to the Board of Trustees for project approval. Project proposals shall be submitted to the Board in accordance with the procedures set out in the Project Management Manual. In the case of global projects, or regional or subregional projects, the participating Creditors shall have joint responsibility.

7.2.2.2 Preliminary study of projects by the Secretariat of the Board of Trustees: The Secretariat shall ensure that the proposals are complete and in general compliance with the QSF's purpose and mandate. Project proposals shall be processed rapidly, in accordance with the procedures set out in the Project Management Manual.

7.2.2.3 Approval by the Board of Trustees: When a project proposal is complete and in compliance, it shall be submitted to the next meeting of the Board of Trustees, or by written resolution between two meetings when the nature of the project, as agreed by the Chair of the Board, warrants more timely consideration. Projects shall be approved by a simple majority and their approval notified to the Creditors within 30 days from the date of the meeting. When the Board of Trustees does not approve a project , it must give reasons for its decision in writing and inform the Creditor within 30 days. The Creditor may then, at its sole and absolute discretion, appeal against this decision to the POC at the next regular POC meeting. On receipt of the Creditor's appeal, the Secretariat shall prepare the appeal dossier and submit it to the POC . The POC shall have sole and absolute discretion to examine and rule on all appeals from the Creditor. Up to 30 days before scheduled examination of the appeal by the POC, the Creditor may amend the project and submit it to the Trustees for consideration. If the project, as amended, is accepted by the Trustees, the appeal shall be withdrawn.

7.2.2.4 Approval of an appeal by the POC : where the POC , deliberating validly, accepts an appeal by a simple majority, the project is referred back to the Board of Trustees for action in accordance with the POC decision.

7.2.2.5 Rejection of an appeal by the POC : where the POC , deliberating validly, rejects an appeal by a simple majority, the POC shall notify its decision with reasons, within 30 days from the date of the appeal hearing.

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7.2.3 Release of funds: The decision by the Board of Trustees to approve the project shall include a schedule for release of the funds and specify disbursement procedures.

7.2.4 Project management and execution: The Creditor shall be responsible for the management and execution of the projects approved and for their completion by the deadlines specified on approval of the project, or within any extension thereof granted by the Board of Trustees. Funds assigned to an approved project which have not been used at the end of the project shall be credited back by the Trustees to the account of the Creditor responsible for the project.

7.2.5 Creditor's obligation to report: As part of the management and execution of a project, the Creditor shall report to the Board of Trustees as the latter may deem necessary in view of the circumstances, in compliance with the provisions of the Project Management Manual. Reports shall focus on progress of the project as well as on the resultant improvements in quality of service. Lastly, the Creditor shall submit a final report to the Board of Trustees on the definitive results of the projects realized using QSF resources.

7.3 Evaluation of project results

7.3.1 Audit of project results: The Trustees may, at their sole and absolute discretion, audit a Creditor during or after implementation of an approved project, prepare a report on the findings of the audit and forward it to all POC members. Such audits shall be conducted taking account in particular of the quality improvement fields referred to in article 7.2.1 of this Agreement.

7.3.2 External evaluation of results: To supplement study of the reports prepared by the Creditor, the Trustees may decide to conduct an a posteriori external evaluation of results. The conditions gov-erning the launch, conduct and use of this evaluation shall be set out in the Project Management Manual.

7.4 Remedial measures

7.4.1 Misspending of Trust funds: When the Trustees are firmly convinced that Trust funds were not assigned solely to the project for which they were provided , they may require the Creditor(s) responsible for the misappropriation or misapplication of these funds to reimburse the QSF. Any such reimbursement shall be credited to the respective accounts of the Creditor; such reimbursement may be made to the QSF through an assignment by, or at the direction of, the designated operator of the Creditor(s) in violation of the terms of the QSF of all or part of the terminal dues payable to it.

7.4.2 Project failure: When a Creditor or its designated operator in good faith fails to implement a project for which QSF funds have been made available to it, without actionable fault, malice or wilful misconduct, or if an approved project for which QSF backing has been received fails, without negligence on the part of the Creditor, funds that are recoverable shall be reimbursed to the QSF in accordance with the provisions set forth in this article. Funds which cannot be recovered shall be deemed lost, with no liability attaching to the Creditor.

8 Term of the Trust 8.1 Term: The term of the Trust was initially set by the Beijing Congress and extended by the respective

Congress resolutions, up to and including 31 December 2020.

8.2 Date of dissolution: The Trust shall be dissolved, its affairs irrevocably wound up and its capital and accrued income disbursed, as hereinafter set forth, on 31 December 2020.

8.3 Disbursement of Trust funds upon dissolution. Unused balances: After reimbursement of the Settlors' assets, Trust funds to the credit of a Creditor on dissolution of the Trust shall be paid into the UPU technical cooperation account in Swiss francs for assignment to projects aimed at improving quality of service in relation to international mail.

9 Other provisions 9.1 Definitions: For the purposes of this Agreement and the Manuals, the following expressions shall have

the meanings defined below:

9.1.1 UPU member in good standing: A member country which has regularly paid its contributions and therefore has no arrears of mandatory contributions, not including interest equal to or more than the contributions billed to it for the previous two financial years, or which has concluded a schedule for the amortization of its arrears.

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9.1.2 Creditor(s): the Creditor country of the Trust or its designated operator.

9.1.3 Account: a record of funds vested in a Creditor, but not a separate account in a financial institution.

9.1.4 Supplier: a supplier of goods or services to a Creditor within the framework of an approved project.

9.2 Effect of partial invalidity: If one or more provisions of this Agreement should be or become contrary to international law, treaties or any other agreements between the members, such provisions shall be null and void and shall be deemed severed from the remaining provisions of this Agreement. The invalidation of such provisions shall not in any way affect the validity of this Agreement, either in whole or in part, provided the Agreement, as thereby modified, continues to provide the parties with the essential benefits contemplated by this Agreement and for which purpose the parties have entered into the same. If the Agreement thus modified does not provide such benefits, it shall be deemed to be cancelled or terminated on such grounds as a court or tribunal of competent jurisdiction may deem equitable.

9.3 Persons bound: This Agreement shall inure to the benefit of the parties, their respective successors and assigns and shall be reciprocally binding on them.

9.4 Precedence of the Deed of Trust: The Deed of Trust shall take precedence over the Manuals.

9.5 Headings: The headings of the paragraphs of this Agreement have been inserted solely for conven-ience of reference and do not form part of it, nor are they intended to aid in the construction of any of the terms or conditions thereof.

9.6 Amendment: Subject to the approval of the POC, this Agreement may be amended by a supplemental agreement in writing signed by the parties.

This Deed of Trust has been prepared in two versions (French and English). The French version shall be deemed to be authentic. This amended Deed of Trust shall come into force on 1 May 2015. Signed at Berne on 30 April 20158 The Trustees (by State) By: Chairman of the Board of Trustees Name: (Please print) Title: Date:

The UPU By: Director General Name: (Please print) Title: Date:

8 The Deed of Trust signed in October 2001 was amended by supplemental agreements approved by the POC in 2006, 2009, 2012 and 2015.

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Classification of countries and territories for terminal dues and Quality of Service Fund (QSF) pur-poses Group 1.1 – List of countries and territories that were in the target system prior to 2010, that apply the target terminal dues system during the period from 2010 to 2013, and that contribute to the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories Australia – Norfolk Island9 Austria Belgium Canada Denmark – Faroe Islands9

– Greenland Finland France French Overseas Territories coming within the Union's jurisdiction by virtue of article 23 of the Constitution: – French Polynesia – New Caledonia – Wallis and Futuna Islands Germany Great Britain: – United Kingdom of Great Britain and Northern Ireland – Guernsey – Isle of Man – Jersey Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Falkland Islands (Malvinas) – Gibraltar – Pitcairn Islands9

– Tristan da Cunha9

Greece Iceland Ireland Israel Italy Japan Liechtenstein Luxembourg Monaco Netherlands New Zealand Norway Portugal

9 These countries and territories have been classified based on their previous status as target countries and territories and not on their PDI value, owing to the unavailability of data.

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Countries and territories San Marino Spain Sweden Switzerland United States of America Vatican10 Group 1.2 – List of countries and territories that were in the transition system prior to 2010, that apply the target terminal dues system during the period from 2010 to 2013, and that contribute to the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories

Bahamas Hong Kong, China Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Anguilla – Bermuda – British Virgin Islands – Cayman Islands – Turks and Caicos Islands Kuwait Aruba Qatar Singapore Slovenia United Arab Emirates Group 2 – List of countries and territories that apply the transition terminal dues system in 2010 and 2011 and the target terminal dues system in 2012 and 2013, that benefit from and contribute to the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories

Antigua and Barbuda Bahrain (Kingdom) Barbados Brunei Darussalam Macao, China Croatia Cyprus Czech Rep. Dominica Estonia Fiji

10 These countries and territories have been classified based on their previous status as target countries and territories and not on their PDI value, owing to the unavailability of data.

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Countries and territories

Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Montserrat Grenada Hungary (Rep.) Korea (Rep.) Malta Netherlands Antilles11 Territory under New Zealand: – Cook Islands Poland Saint Christopher (St. Kitts) and Nevis Saudi Arabia Slovakia Trinidad and Tobago Group 3 – List of countries and territories that apply the transition terminal dues system during the period from 2010 to 2013, that benefit from and contribute to the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories

Argentina Belarus Belize Botswana Brazil Bulgaria (Rep.) Chile China (People's Rep.) Costa Rica Cuba Gabon Jamaica Latvia Lebanon Libya Lithuania Malaysia Mauritius Mexico Montenegro Nauru Oman Panama (Rep.) Romania

11 See International Bureau circular No. 1 dated 3 January 2011.

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Countries and territories

Russian Federation Saint Lucia Saint Vincent and the Grenadines Serbia Seychelles South Africa Swaziland Thailand the former Yugoslav Republic of Macedonia Tonga Turkey Ukraine Uruguay Venezuela (Bolivarian Rep.) Group 4 – List of countries and territories that apply the transition terminal dues system during the period from 2010 to 2013, that benefit from and contribute to the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories

Albania Algeria Armenia Azerbaijan Bolivia Bosnia and Herzegovina Cameroon Cape Verde Colombia Congo (Rep.) Côte d'Ivoire (Rep.) Dem. People's Rep. of Korea Dominican Republic Ecuador Egypt El Salvador Georgia Ghana Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Ascension – St Helena Guatemala Guyana Honduras (Rep.) India Indonesia

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Countries and territories

Iran (Islamic Rep.) Iraq Jordan Kazakhstan Kenya Kyrgyzstan Moldova Mongolia Morocco Namibia Nicaragua Nigeria Territories under New Zealand: – Niue – Tokelau Pakistan Papua New Guinea Paraguay Peru Philippines Sri Lanka Suriname Syrian Arab Rep. Tajikistan Tunisia Turkmenistan Territory of the United States of America: – Samoa Uzbekistan Viet Nam Zimbabwe Group 5 – List of countries and territories that apply the transition terminal dues system during the period from 2010 to 2013 and that benefit from the Quality of Service Fund as provided for in article 31 of the Convention Countries and territories

Afghanistan Angola Bangladesh Benin Bhutan Burkina Faso Burundi Cambodia Central African Rep.

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Countries and territories

Chad Comoros Democratic Republic of the Congo Djibouti Equatorial Guinea Eritrea Ethiopia Gambia Guinea Guinea-Bissau Haiti Kiribati Lao People's Dem. Rep. Lesotho Liberia Madagascar Malawi Maldives Mali Mauritania Mozambique Myanmar Nepal Niger Rwanda Samoa Sao Tomé and Principe Senegal Sierra Leone Solomon Islands Somalia Sudan Tanzania (United Rep.) Timor-Leste (Dem. Rep.) Togo Tuvalu Uganda Vanuatu Yemen Zambia

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Classification of countries and territories for terminal dues and Quality of Service Fund (QSF) pur-poses Group 1.1 – List of countries and territories that were in the target system prior to 2010, that apply the target terminal dues system during the period from 2014 to 2017, and that contribute to the QSF as provided for in article 32 of the Convention Countries and territories PDI

Australia 0.421 – Norfolk Island – Austria 0.623 Belgium 0.576 Canada 0.402 Denmark 0.669 – Faroe Islands – – Greenland 0.229 Finland 0.576 France 0.558 French Overseas Territories coming within the Union's jurisdiction by virtue of article 23 of the Constitution:

– French Polynesia 0.346 – New Caledonia 0.226 – Wallis and Futuna Islands 0.034 Germany 0.602 Great Britain: – United Kingdom of Great Britain and Northern Ireland 0.499 – Guernsey 0.545 – Isle of Man 0.627 – Jersey 0.729 Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Falkland Islands (Malvinas) 0.299 – Gibraltar 0.447 – Pitcairn Islands 0.149 – Tristan da Cunha – Greece 0.268 Iceland 0.323 Ireland 0.468 Israel 0.317 Italy 0.381 Japan 0.498 Liechtenstein – Luxembourg 0.833 Monaco – Netherlands 0.578 New Zealand 0.336 Norway 0.927 Portugal 0.277 San Marino 0.672

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Countries and territories PDI

Spain 0.347 Sweden 0.556 Switzerland 0.829 United States of America 0.575 Vatican – Group 1.2 – List of countries and territories that joined the target system in 2010 Countries and territories PDI

Aruba 0.285 Bahamas 0.316 Hong Kong, China 0.347 Kuwait 0.474 Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Anguilla 0.267 – Bermuda 0.857 – British Virgin Islands 0.540 – Cayman Islands 0.728 – Turks and Caicos Islands 0.377 Qatar 0.598 Singapore 0.445 Slovenia 0.394 United Arab Emirates12 0.495 Group 2 – List of countries and territories that joined the target system in 2012 Countries and territories PDI

Antigua and Barbuda 0.151 Bahrain (Kingdom) 0.190 Barbados 0.165 Brunei Darussalam 0.310 Croatia 0.175 Curaçao 0.237 Cyprus 0.309 Czech Rep. 0.303 Dominica 0.104 Estonia 0.223 Grenada 0.174 Hungary 0.210 Korea (Rep.) 0.254 Latvia13 0.148

12 Specifically concerning the case of the United Arab Emirates, regardless of the provisions in the methodology for the classification of countries for the 2014–2017 period, Congress decided to allow that country to apply the same terminal dues rates as countries classified in Group 3 for the cycle 2014–2017, with that country applying the provisions pertain-ing to countries in Group 1.2 for the purposes of the Quality of Service Fund and the terminal dues link to quality of ser-vice.

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Countries and territories PDI

Macao, China 0.375 Malta 0.271 Territory under New Zealand: – Cook Islands 0.153 Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Montserrat 0.142 Poland 0.161 Saint Christopher (St. Kitts) and Nevis 0.131 Saudi Arabia 0.149 Sint Maartin 0.237 Slovakia 0.215 Trinidad and Tobago 0.174 Group 3 – List of countries and territories that apply the transition system provisions up to 2015 and the new target provisions as of 2016, that benefit from and contribute to the QSF as provided for in article 32 of the Convention Countries and territories PDI Argentina 0.079 Belarus 0.091 Bosnia and Herzegovina 0.058 Botswana 0.059 Brazil 0.117 Bulgaria (Rep.) 0.076 Chile 0.096 China (People's Rep.) 0.073 Costa Rica 0.065 Cuba 0.063 Fiji 0.067 Gabon 0.065 Jamaica 0.070 Kazakhstan 0.068 Lebanon 0.079 Libya 0.108 Lithuania 0.135 Malaysia 0.106 Mauritius 0.098 Mexico 0.081 Montenegro 0.078 Nauru 0.107 Territory under New Zealand: – Niue 0.051 Oman 0.173 Panama (Rep.) 0.064

13 Latvia has voluntarily acceded to the target system as of 1 January 2014, as a Group 2 country.

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Countries and territories PDI

Romania 0.088 Russian Federation 0.093 Saint Lucia 0.102 Saint Vincent and the Grenadines 0.072 Serbia 0.077 Seychelles 0.108 South Africa 0.076 Suriname 0.053 Thailand 0.066 the former Yugoslav Republic of Macedonia 0.056 Turkey 0.097 Ukraine 0.055 Uruguay 0.092 Venezuela (Bolivarian Rep.) 0.099 Group 4 – List of countries and territories that apply the transition terminal dues system during the period from 2014 to 2017 and that benefit from the QSF as provided for in article 32 of the Convention Countries and territories PDI

Albania 0.037 Algeria 0.040 Armenia 0.029 Azerbaijan 0.046 Belize 0.037 Bolivia 0.015 Cameroon 0.013 Cape Verde 0.030 Colombia 0.048 Congo (Rep.) 0.018 Côte d'Ivoire (Rep.) 0.014 Dem People's Rep. of Korea 0.012 Dominican Republic 0.042 Ecuador 0.034 Egypt 0.022 El Salvador 0.034 Georgia 0.023 Ghana 0.015 Guatemala 0.026 Guyana 0.025 Honduras (Rep.) 0.015 India 0.017 Indonesia 0.027 Iran (Islamic Rep.) 0.047 Iraq 0.020 Jordan 0.040 Kenya 0.015

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Countries and territories PDI

Kyrgyzstan 0.010 Maldives14 0.051 Moldova 0.032 Mongolia 0.016 Morocco 0.034 Namibia 0.043 Territory under New Zealand: – Tokelau 0.017 Nicaragua 0.017 Nigeria 0.010 Overseas Territories (United Kingdom of Great Britain and Northern Ireland): – Ascension 0.036 – St Helena 0.025 Pakistan 0.012 Papua New Guinea 0.015 Paraguay 0.022 Peru 0.039 Philippines 0.020 Sri Lanka 0.032 Swaziland 0.044 Syrian Arab Rep. 0.023 Tajikistan 0.009 Tonga 0.046 Tunisia14 0.052 Turkmenistan 0.039 Territory under United States of America: – Samoa 0.038 Uzbekistan 0.013 Viet Nam 0.024 Zimbabwe 0.005 Group 5 – List of countries and territories that apply the transition terminal dues system during the period from 2014 to 2017 and that benefit from the QSF as provided for in article 32 of the Convention Countries and territories PDI Afghanistan 0.003 Angola 0.032 Bangladesh 0.008 Benin 0.009 Bhutan 0.019 Burkina Faso 0.004 Burundi 0.002 Cambodia 0.006 Central African Rep. 0.003

14 The Maldives and Tunisia were reclassified in Group 4 by the 2013 CA.

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Countries and territories PDI Chad 0.005 Comoros 0.021 Democratic Republic of the Congo 0.001 Djibouti 0.012 Equatorial Guinea 0.122 Eritrea 0.005 Ethiopia 0.004 Gambia 0.006 Guinea 0.043 Guinea-Bissau 0.004 Haiti 0.006 Kiribati 0.026 Lao People's Dem. Rep. 0.008 Lesotho 0.011 Liberia 0.001 Madagascar 0.003 Malawi 0.008 Mali 0.004 Mauritania 0.007 Mozambique 0.003 Myanmar 0.012 Nepal 0.008 Niger 0.002 Rwanda 0.011 Sao Tome and Principe 0.018 Senegal 0.009 Sierra Leone 0.002 Solomon Islands 0.013 Somalia 0.000 South Sudan – Sudan 0.010 Tanzania (United Rep.) 0.005 Timor-Leste (Dem. Rep.) 0.018 Togo 0.008 Tuvalu 0.054 Uganda 0.006 Vanuatu 0.023 Western Samoa 0.031 Yemen 0.009 Zambia 0.010 Palestine15 0.017

15 Palestine has observer status within the UPU by virtue of resolution C 115/1999 of the Beijing Congress.

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Resolution CA 4/2008 Application of the UPU Convention and Letter Post Regulations with regard to the classification of Palestine The Council of Administration, Bearing in mind that the Council of Administration has the authority to rule on classification issues for terminal dues and Quality of Service Fund purposes, as far as letter-mail exchanges are concerned, whereas the Postal Operations Council has the authority to set the inward land rates for parcels, Decides to classify Palestine for terminal dues and Quality of Service Fund purposes as follows:

a For the cycle ending in 2009, the provisions of the transitional terminal dues system will apply. Palestine will be entitled to Quality of Service Fund benefits pursuant to article 31.1 of the Convention.

b For the 2010–2013 cycle, the provisions of the transitional terminal dues system will apply. Palestine will be entitled to Quality of Service Fund benefits corresponding to Group 5 as provided for in resolu-tion C 18/2008.

Reminds the POC to take appropriate action within its area of competency.

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Resolution C 77/2012 Classification of countries and territories for terminal dues and Quality of Service Fund (QSF) pur-poses Congress, Having adopted the provisions of the Union's new terminal dues system, Considering that 24th Congress resolution C 18/2008 approved the methodology for the classification of countries for terminal dues and QSF purposes and its application on a four-year classification cycle basis as of 2010, Taking into account the updates and complements to this methodology introduced by the CA during the 2009–2012 period based on previous Congress mandates, Reiterating the position of the last Congress that the need for preferential terminal dues rates decreases with the coun-try-specific potential to self-finance postal development and increases with the country-specific difficulties in serving the postal territory and with the postal service level provided, Noting that the gross national income per capita reflects the potential to self-finance postal development and that the average costs per letter reflect the difficulties in serving the postal territory, Bearing in mind that the special needs of small countries/territories, i.e. small island developing countries/territories and land-locked countries/territories in similar circumstances, have to be fully taken into consideration, Recognizing the special needs of least developed countries for preferential treatment, Noting also the request submitted by the United Arab Emirates, approved by the 2012 CA, to add the following text, alongside the listing of the United Arab Emirates: "During the 2014–2017 period, the provisions applicable to a new terminal dues target system country shall be applied to the United Arab Emirates, while this country shall remain in group 1.2 for the purposes of the Quality of Service Fund and the terminal dues link to quality of service", Bearing in mind also that the request of a country to apply provisions other than those pertaining to the group in which it is classi-fied based on the postal development index falls under the provisions of section III of the classification meth-odology concerning appeals, Further noting the uncontested request to the CA by Palestine to be included in the classification list for terminal dues and QSF purposes, Decides – to approve the updated methodology for the classification of countries for the 2014–2017 period, as

described in Annex 1;

– specifically concerning the case of the United Arab Emirates, regardless of the provisions in the meth-odology for the classification of countries for the 2014–2017 period, to allow that country to apply the same terminal dues rates as countries classified in Group 3 for the cycle 2014–2017, with that country applying the provisions pertaining to countries in Group 1.2 for the purposes of the Quality of Service Fund and the terminal dues link to quality of service;

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– to approve the classification of countries for terminal dues and QSF purposes, in the groups shown in Annex 2; the provisions concerning terminal dues rates and levels of contribution and access to QSF funds are specified in the Convention,

Authorizes the Council of Administration to:

– decide on the temporary downward reclassification of countries due to war or extremely severe eco-nomic crisis;

– hear any appeals and issue a decision no later than the CA session of 2013, following the process described in the classification methodology (section III) in Annex 1.

(Proposal 38, Committee 5, 2nd meeting)