Carrier and customs cooperation

WCO encourages customs agencies and ocean carriers to work together in drug war.

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Ocean carriers may transport a bulk of the world’s cargo, but they also move large amounts of narcotics shipments and other contraband.

The World Customs Organization realizes that it’s impossible for even the most sophisticated member agencies to check every vessel and container for this illegal cargo. That’s why it is encouraging its members to enlist the help of carriers in this battle through antidrug smuggling agreements, or memorandums of understanding.

"The whole idea behind the memorandums of understanding started with the WCO," said Thomas Timlen of the Baltic and International Maritime Council, based in Bagsvaerd, Denmark. "It’s a way to get carriers and Customs to work together on an international basis."

BIMCO represents about 1,000 ship owners, who are actively engaged in all major and developing ocean freight markets worldwide. It’s not uncommon for carriers to unknowingly have drugs or contraband stowed on their ships, especially with shipper-loaded containers onboard.

When illegal shipments are discovered by customs authorities at ports of destination, the results can be financially as well as publicly devastating to ship owners and their crews.

Memorandums of understanding, or MOUs, can help protect ship owners from "automatic liability" when illegal drugs are discovered and establishes a cooperative relationship with customs agencies. MOUs also help carriers to avoid or mitigate related penalties for drug seizures.

"These agreements help to ensure that carriers are compliant with antidrug smuggling legislation, while simultaneously protecting the free movement of innocent cargoes," Timlen said.

BIMCO became heavily involved in drug smuggling issues after the U.S. Congress passed the Anti-Drug Abuse Act in 1986, which came down particularly hard on the transport sector.

"Not only were ship owners faced with the possibility of having their ships confiscated in cases where evidence of illicit drug smuggling was discovered, they could easily find themselves being fined hundreds of millions of dollars, enough to put some companies out of business," Timlen said.

Under the act, the ship owner and master were held automatically liable when drugs were discovered, unless they could show that they had exercised "the highest degree of care and diligence" and proved that they had no knowledge of the presence of the illegal drugs on board. "In other words, the ship owner and master were assumed guilty until proven innocent," Timlen said.

BIMCO and other industry groups were alarmed by the harsh rules. In 1988, the penalties and onerous requirements led to the creation of the Maritime Security Council, which comprises ship owners and industry association representatives, and officials from Customs, Coast Guard, and Department of Transportation. That year, Customs introduced the Sea Carrier Initiative Agreement. This agreement established a workable arrangement between the owners and Customs based on cooperation and the mutual understanding of each party’s needs.

"BIMCO sought and obtained the agreement of the U.S. Customs Service on behalf of its owner members," Timlen said. "Through this arrangement, there are presently 357 owner members enrolled, or about 40 percent of our membership."

But BIMCO’s work was far from over. During the late 1980s and early 1990s, drug traffickers began to increase the quantity of narcotics bound for European ports. The council began to promote the establishment of similar antidrug smuggling agreements with European Customs authorities.

In 1991, the World Customs Organization held a conference in Brussels aimed at pursuing these types of cooperative agreements with the carrier industry.

BIMCO was invited to participate in that conference and in 1994 signed its first European MOU with U.K. Customs. Today, 405 BIMCO ship owner members participate in the U.K. MOU, also known as the Anti-Drug Alliance program.

Since then, BIMCO has signed 10 additional MOUs in Europe, which includes Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Netherlands, Norway, and Sweden. In November, the council signed an MOU with Canada Customs.

"Drug markets are being expanded by organized crime," Timlen said. "The routes that they use are always changing. More MOUs have to be signed with countries newly affected by this illegal trade."

The International Maritime Organization also heightened the need for the carrier industry to establish cooperative agreements with customs agencies this month by implementing new language in the annex of its Facilitation Convention.

While the amendments to the convention recommend the establishment of cooperation agreements between customs agencies and the industry to fight drug smuggling on ships, it also requires that all sensitive commercial information must be handled confidentially.

Customs authorities are also asked to ensure that risk analysis is used during cargo and ship search efforts. The use of risk analysis has two advantages: It enhances the effectiveness of customs controls, and protects the free movement of innocent cargoes.

BIMCO’s success has also attracted the attention of other transport industry groups. "We’re attending meetings with trucking, manufacturer, freight forwarder and air freight groups," Timlen said. "They’re learning from our experience how to work with customs agencies to stop drugs."

However, many ship owners still do not participate in MOUs and they will continue to the pay the price for drug smuggling.

In 1998, the vessel Kleo-voulos of Rhodes sailed from Colombia to Aliveri, Greece. Upon arrival, Greek drug squad officers found 189 kilos of cocaine hidden in sealed packages near a ballast suction pipe. The 34 officers and crew were arrested on drug charges, and imprisoned during the investigation.

"Securing the release of these seafarers proved difficult, and the situation wasn’t helped by the fact that the ship’s owners were not participating in the Greek MOU, or as far as we knew, any antidrug smuggling program," Timlen said. "Had they been, establishing a deference for the officers and crew would certainly had been easier."

Similarly in March 2000, a cargo vessel entered the Greek port of Egion with 8.5 kilos of cocaine on board. Because the ship owner was signatory to the Greek MOU and took the necessary steps to discover and report the incident, Greek Customs took possession of the cocaine upon arrival without detaining the vessel or crew, Timlen said.