Nominal Rate Subscriptions - Periodicals
This Customer Support Ruling discusses nominal rate subscriptions
for publications in the Periodicals general publications category.
Domestic Mail Manual
(DMM) 707.6.1.2 states, in part, that general publications must have
a legitimate list of subscribers who have paid or promised to pay at
a rate above a nominal rate for copies to be received during a
stated time. Publications primarily designed for free circulation
and/or circulation at nominal rates may not qualify for the general
Nominal rate subscriptions include:
sold at a price so low that it cannot be considered a material
sold at a reduction to the subscriber, under a premium offer or
any other arrangement, of more than 70% of the amount charged as
the basic annual rate. The “basic annual rate” is the amount
that entitles the subscriber to receive one copy of each issue
published during the subscription period.
The value of a premium is considered to be its actual
cost to the publisher, the recognized retail value, or the
represented value, whichever is highest.
In view of the provisions of DMM 707.6.1.2, if less
than thirty percent of the basic annual subscription price is charged for
a subscription, that subscription will be considered to have been
paid at a nominal rate. For example, if the basic annual
subscription price is $20.00, a subscription being sold for $5.99
would be a nominal rate subscription.
Also, after deducting the value of any premium(s)
offered with a subscription, if the net price is less than thirty percent
of the basic annual subscription price, that subscription will be
considered to have been paid at a nominal rate. For example, if the
basic annual subscription price is $20.00 and a book the publisher
represents as “a $15.00 value” is being offered as a premium with
the subscription, the net price ($5.00) would constitute a nominal
rate subscription because $5.00 is less than thirty percent of the basic
As a footnote, it is permissible, on the other hand,
to sell subscriptions at more than the basic annual subscription
price. For example, a common practice of membership organizations
that receive member subscriptions at the basic annual rate is to
sell non-member subscriptions above the basic rate.