Summary
Regulation governs approval, manufacturing, distribution, and security requirements for Postage Evidencing Systems (postage meters and PC Postage products). It requires Postal Service approval to become a provider, mandates compliance with technical specifications (IMIPC), imposes unannounced inspections, requires security weakness reporting within 24 hours, holds providers liable for revenue losses, and grants broad suspension/revocation authority.
Reason
This regulation creates classic regulatory capture: the Postal Service, a market participant itself, controls entry into the postage payment system, raising barriers to competition and innovation. Small providers cannot bear the compliance costs (inspections, reporting, technical specs, liability), while incumbents are protected. The 24-hour breach reporting, mandatory approval for system changes, and unlimited liability are disproportionate to any legitimate revenue protection needs. Private certification and market mechanisms (insurance, bonding, reputation) would secure postage integrity far more efficiently without stifling competition and concentrating power in a government monopoly.