DHL Corporation and Subsidiaries - Page 134

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          VIII.  The Imbalance and Transfer Fees                                      
               DHL shipments of domestic origin to foreign destinations to            
          be delivered through DHLI were termed “outbound” shipments.  DHLI           
          shipments of foreign origin to domestic destinations to be                  
          delivered by DHL were termed “inbound” shipments.  Shipments of             
          foreign origin with foreign destinations, but which passed                  
          through the United States and were handled by DHL, were termed              
          “transfer” or “transit” shipments.                                          
               Before 1983, actual imbalances of shipments were not tracked           
          or reported by either DHL or DHLI/MNV.  In December 1983,                   
          however, the DHL board recognized the need to examine the ratio             
          of U.S. inbound to outbound deliveries, as well as the need for             
          further study of the allocation of air transportation costs for             
          on-forwarding of international shipments between U.S. points and            
          a comparison of corresponding international on-forwarding of U.S.           
          shipments.  Before 1987, neither DHL nor DHLI was compensated if            
          the outbound or inbound shipments exceeded one another.                     
          Likewise, before 1987, DHL received no compensation for handling            
          transfer shipments.                                                         
               In a 1988 amendment to the 1974 MOA, provision was made for            
          a cost plus 2 percent compensation on the imbalance of shipments            
          (imbalance fee).  DHL’s system of determining imbalance shipments           
          and applying cost plus a percentage markup was modeled after the            
          system used by postal authorities throughout the world.  The                
          imbalance fee was implemented for the taxable year 1987 and                 




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