Maritime Economics & Logistics, 2003, 5, (311–320)

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Maritime Security – The Need for a Global

Agreement1

D I N O S S TA S I N O P O U L O S 1

1
E u r o p e a n U n i o n F e l l o w a t t h e E u r o p e a n U n i o n C e n t e r, U n i v e r s i t y
Center for International Studies, University of Pittsburgh, USA.
E-mail: dstasinopoulos@skynet.be

This note reviews US maritime security measures, outlines work carried out by
international organisations and then frames maritime security within the
wider context of maritime trade. Finally, it suggests the development of a Global
Agreement linking security and other maritime trade-related issues. The
initiative for such an agreement should be undertaken by the EU only if current
International Maritime Organisation (IMO) efforts fail to produce a maritime
security framework with binding requirements and after the wider impact of US
security measures has been properly assessed (Flynn, 2002). The September 11
events have revealed the soft underbelly of globalisation. The liberalisation of
markets and the resulting facilitation of trade and travel allow terrorists to do
their worst. Existing border-management architectures provide no guarantees
that terrorists can be prevented from reaching their targets. Furthermore,
market pressures are now forcing transport companies to embrace higher
standards and adopt technologies and processes that can make border control
less relevant. Preoccupation with the urgency of domestic security issues has
encouraged the US to develop security standards and urge the rest of the world
to adopt their approach or to engage in direct negotiations with them. The US
approach is two-fold: it is based on the early detection and interception of
terrorists (by moving control away from borders to points-of-origin) who seek to
exploit or target the international transport networks coupled with cooperation
on data gathering and information sharing.1 These two aspects have shaped US
initiatives and legislations such as the Container Security Initiative (CSI) (US
Customs 2002), the ‘Port and Maritime Security Act of 2001’ and the ‘Maritime
Transportation Antiterrorism Act of 2002’.2 These two legislative Acts and the
CSI initiative aim at enhancing security, while at the same time furthering US
strategic interests in security-related trade issues and strengthening the US
maritime industry’s position in order to make it more competitive (Lloyd’s List,
February 2002). There is a need to study the wider implications of US maritime
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security initiatives and assess US intentions within the context of international

maritime trade. US-driven maritime security initiatives and the current
fragmentation of efforts of international organisations such as IMO, World
Customs Organisation, International Labour Organisation, and International
Standards Organisation, if are not checked by the international maritime
community (through a global agreement), may ultimately enable the US to
impose its requirements on the rest of the world and affect the operations of
international shipping. There is no doubt that current efforts to secure new
maritime security consensus through the IMO is a step in the right direction.
The amended Chapter XI of the International Convention for the Safety of Life
at Sea (SOLAS) Convention and the Ship and Port Facility Security Code (ISPS
Code) although fundamental to a global security do not cover containers.
However, given the multiplicity of actors involved, existing arrangements may
not guarantee the required coordination in particular with the WCO.
Furthermore, it is not certain that input from the various organisations with
varying degrees of expertise will dovetail with IMO work already underway. In
order to deal with the consequences and pitfalls of the US initiatives and cope
with the fragmentation of international efforts, the development of a Global
Agreement should be considered to weld all the stakeholders in a legally
binding international framework. A Global Agreement may prove to be a much
more cost-effective way of enhancing maritime security globally and restraining
US ‘hegemonic’ ambitions and unilateralism in maritime trade.
Maritime Economics & Logistics (2003) 5, 311–320.
doi:10.1057/palgrave.mel.9100080

Keywords: Maritime; security; US measures; Global Agreement.

INTRODUCTION

Now that the war in Iraq is over, the EU and the US may attempt to heal the
present rift and improve cooperation on a range of issues including
transportation security. Since September 11, the European and American media
have extensively covered US intentions to use its military power to manage
global affairs and trade. The US strategy is characterised by a desire to redraw
the map in conflict areas that are rich in natural resources, such as the Middle
East and Caspian Sea regions. The US depends on the control of oceans and sea-
lanes to realise its strategic objectives and therefore critical maritime
infrastructure such as ports, waterways and vessels is of paramount
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importance. The US-flag fleet, however, faces difficult challenges in foreign

trades. Despite ever more efficient ships and crew and the increased role of
foreign trade in fuelling the US economy, less than three 3% of US trade arrives
or leaves US shores on US-flag ships. This downward trend has alarming long-
term implications for US security and economy. The US-flag fleet comprises less
than 1% of the international commercial fleet. This decline is particularly
striking when contrasted with the growth of world trade. The US generates
25%–30% of all global trade and is by far the largest single producer and
consumer market. However, thousands of US importers and exporters are
entirely dependent on foreign carriers. Over the next 20 years, the international
trade volume is expected to double. Furthermore, a strong US maritime sector is
vital to the national economy and security. Even during times of war or
international crises, 95% of the shipments are carried out by ships in
international waters. In addition to the need to protect critical infrastructure
from terrorist attacks, strategic considerations such as the continued existence
of a US-flag commercial fleet have also influenced the US policy approach in the
maritime sector.

THE US MEASURES

Over the last 18 months, several measures were enacted that aim at en-
hancing security. These include the Container Security Initiative (CSI), the
Customs Trade Partnership Against Terrorism (C-TPAT), and the Port Security
Bill.
Some 200 million containers move through the world’s top seaports. Nearly
50% of the value of all US imports arrive via sea containers. In January 2002,
US Customs launched the CSI, which is designed to enhance security of the sea
container, which is a vital link in global trade by preventing containerised cargo
from becoming an easy terrorist target (US General Accounting Office Report on
CSI, November 2002). It is a multi-faceted approach that would affect the design
of containers, the algorithms for identifying ‘high risk’ boxes and the ability to
screen the containers at US ports and at important hubs in Europe and Asia.
This initiative has four core elements: (1) using automated information to
identify and target high-risk containers; (2) pre-screening containers identified
as high risk before they arrive at US ports; (3) using detection technology to pre-
screen high-risk containers quickly; (4) using smarter, tamper-proof containers.
Unless it is determined that a container has been tampered with, containers
identified as high risk will be screened at the port of departure, rather than at
the port of arrival, using a combination of large-scale X-ray and gamma-ray
machines and global positioning transponders. By placing US inspectors at
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major foreign seaports to pre-screen cargo containers and working with their
foreign counterparts, US Customs will be in a position to detect potential
dangerous weapons in US-bound containers. Since nearly 70% of US-bound sea
containers pass through 20 major seaports around the globe, Customs is initially
focusing on these ports. The objective is to engage these ports that send the
highest volumes of container traffic into the US. Thereafter, CSI will be
expanded to other strategic ports that ship significant volumes of containers to
the US. Within the framework of the CSI, the US has also undertaken to address
their security concerns by concluding bilateral agreements with certain
countries, including EU Member States. So far, eight EU Member States have
signed declarations of principle with the US Customs to introduce the CSI in
their ports, as well as agreeing to the stationing of US Customs officials. The
container traffic from these ports to the US covers approximately 85% of all
maritime container traffic from the EU to the US. The issue of reciprocity, along
with concerns of possible distortions of competition between ports (faster
clearing of containers arriving from ‘secure’ ports) and likely trade and
efficiency repercussions have been raised by the EU with the US authorities.
Other EU concerns include, disclosure of traffic data unrelated to security
concerns and the importance of national treatment for EU and US operators,
which underscores the need for such security measures to be WTO compatible.
A further source of concern is the extraterritoriality of CSI, that is, the
question of US competence to issue legislation having an effect beyond its own
territory is raised. Reacting to the CSI, the International Chamber of Shipping
has expressed serious concerns and stressed that the initiative was potentially
trade disruptive. The issue is not only about the safe movement of containers
but also about how the basic mechanisms of global trade can operate while
enhancing and maintaining security. The CSI would have an impact on
operations of EU and other third countries ports: if the US Customs refuse to
issue a permit to unload the vessel, the rejected freight would therefore have to
go back to the port of loading.
Although the implementation of bilaterals signed between the US Customs
and the megaports is well underway, the CSI work is still in progress. Guidelines
and standards are still being refined and questions about certification remain.
Furthermore, some of the technology now being used in the screening is still in
development. There are some gaps in GPS technology, for example, and
although the government is paying lip service to the concept of electronic
container seals, improvements need to be made and costs need to decrease.
Questions remain over who will pay for the e-seals and how the devices will be
managed.
Another sticking point on port security is a proposed US Customs
regulation, which will require that ocean carriers provide advanced manifest
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information detailing the loads into US-bound shipping containers at least 24 h

before the containers are loaded in foreign ports. Although CSI is a system in its
own right, it is also part of a wider initiative concerning maritime trade in
general.
In April 2002, CSI was augmented by the Customs Trade Partnership
Against Terrorism (C-TPAT), a joint government–business voluntary pro-
gramme for importers with the requirement of expedited goods entry. For
shipping lines, the recommendations focus on securing facilities restricting
access to terminals and vessels and, from foreign vendors to the US land
borders and seaports. It builds on past, successful security models between
Customs and Trade authorities that were designed to prevent commercial
shipments from being used to smuggle illegal drugs. C-TPAT security
requirements are meant to push the security perimeter as far out as possible,
making sure that importers move their goods in secure partnerships from the
time the merchandise leaves the factory to the point where it is received by the
retailer. Joining C-TPAT puts the industry in partnership with companies that
have the same interests and makes them privy to and a part of actions and plans
being discussed by Customs.
Although the industry is navigating its way around CSI and C-TPAT, they are
treading water on the Port Security Bill (Bill), which requires, in part, that each
port implement a federally approved security programme; that more information
about shippers’ cargo, crew and passengers be collected prior to entry in a US
port; and that advance cargo manifest data be collected by Customs.
The Bill aims to create, in conjunction with the CSI and C-TPAT, a
comprehensive security policy for the 361 US seaports. While US initiatives on
maritime security are grabbing the headlines, other battles are also being waged
with equally significant long-term implications for maritime trade. The
Congress has loaded the bill with additional maritime provisions that go
beyond security considerations. It extends the Coast Guards’ authority beyond
the traditional tasks of search and rescue, ice-breaking and fisheries protection
and dictates that Customs physically inspect 10% of inbound containers, versus
two percent at present. The bill also provides grant money for the development
of devices to detect hazardous material (inside containers). A proposal by
Senate Commerce Committee Chairman E. Hollings to impose a ‘user fee’ on
exporters and importers to help finance the implementation of the bill has
resulted in a controversy between the House and Senate. Under the proposal,
the federal government would assess a fee on containers, oil barrels and other
cargo, which in turn would pay for the enhanced security measures. House
Members objected, on the grounds that it constituted a tax. Under the
Constitution, taxes must originate in the House rather than the Senate. The US
industry (importers/exporters) argues that they should not assume the cost of
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an initiative that benefits the whole country, especially when they already pay
customs duties and other user fees for customs operations. The Congress
cleared the Bill in December 2002 after the requirement for user fees was
dropped. In April 2002, the Seaport Security Improvement Bill was introduced
to mandate by the end of 2004 the use of AIS equipment on vessels calling at US
ports. It also calls, inter alia, for world standards for secure containers and
transparency of ownership information on vessels calling at US ports. In this
Bill, political ramifications outweigh the technological progress, effectively
mandating unilateral US legislation if International Maritime Organisation
(IMO) actions fall short.
Certain provisions on risk assessment in the US Maritime Transportation
Antiterrorism Act of 2002 have also caused concerns. The Act requires the
setting up of a system of ‘foreign ports assessment’, based on US benchmarks
and provisions for controls on board ships outside territorial waters, and this
without any reference to the new IMO regulations.
The port security provisions also require the Transportation Department to
conduct vulnerability assessment of vessel and port facilities and the Coast
Guard to draw up a National Maritime Security Plan, establish a maritime
intelligence system to monitor vessels operating in US waters, provide
information about shipper’s cargo, crew and passengers before they enter a
US port; impose background checks on people working in security-sensitive
areas; and fund more US security agents for ports.

W O R K B Y I N T E R N AT I O N A L O R G A N I S AT I O N S

Although much of the framework in maritime and port security is established

by the IMO, there are other international bodies involved in maritime and
supply-chain security such as the Organisation for Economic Cooperation and
Development (OECD), the World Customs Organisation (WCO), the Interna-
tional Labor Organisation (ILO) and the International Standards Organisation
(ISO). This session highlights recent work by the above organisations. The
February 2002 intersessional meeting of the IMO Working Group on Maritime
Security considered, inter alia, the container initiative. The US recommended
that the Maritime Committee endorses the US Customs Service initiative and
recommended that other countries consider developing a similar system. The
US further recommended that the IMO support the initiative as a subject of
discussion with WCO and encourage the WCO to move this concept forward
expeditiously within the world’s Customs organisations.
Following the adoption by IMO Resolution A. 924(22), working groups
have been discussing a variety of issues ranging from security plans for ports,
ships and offshore terminals, to security checks for seafarers.
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A series of measures to strengthen maritime security, which represent

the results of a year’s work by IMO’s Safety Committee and its Inter-
sessional Working Group, will come into force in July 2004 following
their adoption by the December 2002 Diplomatic Conference (IMO Press
Release December 2002). A number of amendments to SOLAS, the most
far-reaching of which enshrines the new International Ship and Port Facility
Security Code (ISPS Code) represent a challenge for all parties concerned. The
Code contains detailed security-related requirements for governments, port
authorities and shipping companies in a mandatory form, together with a
series of guidelines about how to meet these requirements in a second,
non-mandatory section.
A recent OECD Maritime Transport Committee report calls for tougher
requirements on ownership and a crackdown on the use of ‘flags of
convenience’ to help combat terrorism. New rules expected to be presented
in November this year, could include compulsory disclosure of the real
ownership of vessels, tougher scrutiny of shipping registers and changing
international agreements to ensure a closer link between a ship and the state in
which is registered. This could be the beginning of rather important changes
with a wider impact on maritime trade.
In June 2002, WCO adopted a resolution to develop a strategy to safeguard
the global supply chain from terrorist threats (US Department of Homeland
Security, Press Release, June 2002). The resolution is designed to increase
security and facilitation of the international supply chain, and has a wider remit
than the US CSI. It applies to all international trade, not just container security,
and is concerned with fighting organised crime, including money laundering, as
well as international terrorism. In September 2002, WCO set up a task force to
study and develop new guidelines for supply chain security and it should
complete its work by June 2003. The task force is examining various security-
related topics, including enhancement of import, export and in-transit controls
and developing better data and techniques for spot-inspecting cargoes. The
WCO’s 161 members are customs administrations with varying levels of
modernisation and sophistication. There is no guarantee that CSI requirements
will be properly implemented since certain members lack the infrastructure to
facilitate trade and provide greater security.
The ISO is a worldwide federation of national standard bodies from 140
countries and attempts to standardise activities and products in order to
facilitate international exchange of goods and services. ISO is currently involved
in a project dealing with electronic seals of containers.
The ILO is the agency responsible for determining the requirements for
documents’ identification for seafarers and port workers. It also checks the
background of crew members on cargo ships.
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The World Trade Organisation (WTO) and UN Conference on Trade and

Development (UNCTAD) are actively trying to accelerate cargo movements by
streamlining of customs procedures and other freight requirements.
While none of the above organisations provides a comprehensive coverage
of security issues, they represent part of a wider framework for discussion and
negotiations.

CONCLUSIONS

Before September 11, maritime security was not a high priority, but rather a by-
product of sound commercial judgement. However, post September 11, the
increased number of international as well as US-led initiatives reflect the
concerns of the global maritime trade community (COM 2003, 229 Final 5 May
2003). We are just beginning to understand the complexity of the link between
maritime trade and security. The fundamental issue is not the security of ship
containers, but how the mechanism of global trade can operate while
maintaining efficiency and enhancing security (The Economist, 6 April 2002).
Many analysts believe that the US maritime security legislation and
initiatives will have an important impact on global maritime operations that will
outweigh security requirements. For example, provisions such as the use of the
Automatic Identification System and transparency of ownership information on
vessels calling at US ports and calls for worldwide agreements on seafarer
identification (smart cards with encoded biometric records) may have
important implications for maritime trade. In these initiatives, political
ramifications outweigh security considerations, effectively mandating unilateral
US action if initiatives by the international organisations fall short. The
International Chamber of Shipping has also argued that the whole package of
US legislation is ‘potentially trade disruptive’. There are some indications that
the recent CSI agreements signed between the US Customs Services and the 20
megaports are changing shipping patterns and may affect the international
shipping environment.
In order to deal with the above consequences of the US initiatives, there is a
need to develop a maritime security framework that avoids costly information
sharing and exchange and the privacy protection pitfalls implied by the US
approach.3 It is, of course, important that US bilateral maritime security
initiatives become integrated in an overall maritime trade framework based on
international provisions that cover maritime security, safety and other maritime
trade-related aspects. The tension between the needs of international maritime
security and those of global trade need to be addressed by involving economic
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organisations such as the WTO and UNCTAD in the development of a new

framework.
Achieving consensus and forging international agreements on maritime
security issues requires the active and joint participation of all organisations
concerned with security and trade. To encourage the broadest possible
international consensus regarding maritime security on a global basis, a
transport security agenda was promoted at the G8 Summit in Canada (Action
Plan, Kananaskis Summit June 2002).
Thus in conclusion, it may be advisable to wait for the process of
cooperation initiated by IMO to run its course, because this would allow us to
assess the US intentions and evaluate progress in reaching a global consensus. If
the goal of the development of a framework covering security and other
maritime-trade-related aspects is impeded by a lack of proper coordination and
turf battles between the international organisations, then the EU should
consider convening an international conference in late 2004/early 2005 to
initiate the preparation of a global agreement. It should be noted that the
amendments to SOLAS and Part A of the ISPS Code are requirements subject to
interpretation. A global agreement will ‘weld’ all major stakeholders, including
– industry representatives and maritime, customs and economic/trade
organisations – into a comprehensive regime with legally binding obligations
on all elements concerning maritime trade and security. My discussions with US
stakeholders involved in maritime trade (shippers, maritime insurers, charterers
and financial institutions) and academics confirmed that they would be willing
to support negotiations at the United Nations (preferably at IMO, with close
cooperation with other relevant organisations) to develop such an agreement.
US involvement and alliances with third countries are of course of paramount
importance. Although this is no easy task, a Global Agreement may prove to be
a much more cost-effective way of enhancing maritime security globally and
restraining US ‘hegemonic’ ambitions and unilateralism in maritime trade.4

ENDNOTES
1
This article represents part of a wider research project on transportation security carried out at the
University of Pittsburgh (Fall 2002).
2
The CSI is a four-part programme designed to achieve a more secure maritime environment by
engaging the ports that send the highest volumes of container traffic into the US, as well as the
governments in those locations, in a way that will facilitate early detection of potential problems.
The 2001 and 2002 Maritime and Port Legislative Acts aim at heightening awareness of the need for
collective action and the development of a coordinated interagency and public–private approach to
port and waterways security.
3
Civil liberties campaigners claim that data privacy rights have been substantially eroded as a result
of the response to the September 11. US measures concerning data on passengers and vessels

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would have normally taken years to debate but in the post September 11 world, they are pushed
right to the top of the agenda and despite opposition by civic liberties groups, they are rushed
through. These groups have stressed the need for thorough consultations with industry and civil
society, so that their concerns regarding the practicality and benefits of the measures and its
conformity with the EU and other countries/regions data protection requirements can be taken into
account.
4
It should be noted that US foreign policy in general has been characterised by a general reluctance
to comply with international and multilateral obligations. The US has repudiated an array of
treaties and institutions – the Kyoto Protocol on global warning, the International Criminal Court
and the Biological Weapons Convention. If left unchecked in maritime security, this unilateral
attitude already apparent in other sectors, will allow the US to operate in the world on its own
terms and away from the constraining framework of multilateral rules and institutions.

REFERENCES

Communication from the Commission to the Council, the European parliament, the European
Economic and Social Committee and the Committee of the Regions, on Enhancing Maritime
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Container trade – when trade and security clash. The Economist 6 April, 2002.
Cooperative G8 action on transport security. Group of Eight Summit, 2002, Kananaskis, Canada.
Flynn Stephen, E. 2002: America the vulnerable. Foreign Affairs 81(1): 60–74.
IMO. 2002: IMO adopts comprehensive maritime security measures. IMO Press Release, 13 December,
2002.
Lloyd’s List. Shipping ready to back US maritime measures. 7 February, 2002.
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US Department of Homeland Security. 2002: World Customs Organisation adopts elements of US CSI. 28
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