1. Some countries do have cut off on value considered as "Gift" - e.g. if you send something 250+ (or 150+ - I think it's 150...) from US to Canada, won't matter if you mark as Gift or not - the SHEER value of the item will make it subject to duties. Way to avoid this fee? You mark the item as low value and hope customs does not think the size/contents gives its true values away.
2. If refused - goes back to receiver VIA CHEAPEST SHIPPING MEANS POSSIBLE i.e. boat/surface. If not return address? Then the item is sent to country of initial stamp/post fees-paid and sits in a bin as unclaimed. After 6 months (think this is the cut off time), if unclaimed, is opened and either sent to charity/taken by postal work/destroyed.
3. I would NEVER provide old address to pp, OTHER or not - figure pp monitors EVERYTHING.
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