Container Security Initiative (CSI)

Container Security Initiative (CSI)

Jamie Stranger

Background to CSI

Post September 11, 2001 the U.S. not surprisingly became concerned that a terrorist organisation may smuggle a nuclear device into one of the 15,000 containers that arrive in the U.S. everyday. At present only 2% of those containers are physically inspected by U.S. Customs.

The scenario goes like this. A nuclear bomb detonates in a U.S. Port. Apart from the obvious damage to life and property, the shipping of sea containers into the US would immediately stop. No further imports would be allowed until measures were adopted to ensure that additional weapons could not be smuggled. A prolonged global recession may follow.

What is CSI?

It is a series of measures adopted by U.S. Customs to move their container screening process outward (i.e. identifying high risk containers in foreign ports before they are loaded on vessels destined for the U.S. It involves the following four core elements:-

1. Identifying high risk containers

Previously, carriers and NVOCCs were only required to present a cargo manifest to U.S. Customs upon arrival in the US.

However, that has changed. From 2nd December 2002 carriers and NVOCCs are now required to provide their cargo manifests to U.S. Customs 24 hours before the cargo is loaded at the foreign port. The rule does not apply to bulk cargo. Break bulk cargo may be exempted on a case by case basis.

U.S. Customs will impose fixed penalties if the cargo manifest is not provided on time and may not allow the vessel to discharge its cargo. To allow carriers and NVOCCs sufficient time to implement new procedures no prosecutions will be made until after 1st February 2003.

Further, US Customs now requires more detailed cargo manifests to be provided. Particulars are required of the final seal number for each container, precise quantity of the cargo (pieces and weight), the identity of the shipper, the identity of the consignee (where known) and the container number. US Customs has advised that it will no longer accept general descriptions of cargo such as 'Freight all Kinds', 'General Cargo', 'STC' or even 'Chemicals' and 'Foodstuffs'.

2. Pre-screening high risk containers before they arrive in U.S. Ports

In addition to the 24 hour rule U.S. Customs is expanding its pre-screening procedures to foreign ports. Previously this was done only upon discharge in the U.S.

Under CSI U.S. Customs will station officers in foreign ports (who have implemented CSI) to pre-screen U.S. bound containers. They will use their Automated Manifest System (AMS) to identify for further evaluation cargo that is unusual, suspect or high risk.

Singapore is the CSI pilot port for Asia. There is now a small team of U.S. Customs officers stationed in Singapore and more are likely to be added.

Once a container is screened and approved in the foreign port it will not be subject to further inspection upon discharge in the U.S.

3. Using detection technology to screen high risk containers

The U.S. Customs Service will expand its use of the latest mobile x-ray and gamma ray inspection machines and radiation detectors. These machines can screen a 40' container in 90 seconds. They will eventually be stationed in CSI ports.

4. Using more secure containers

U.S. Customs is developing more secure containers to ensure the integrity of containers screened in foreign ports. The features will include electronic seals to detect tampering after the container is screened and motion and/or light detectors to warn of any attempt to penetrate the container.

Consequences of not joining CSI

Containers will not be pre-screened by U.S. Customs in non-signatory ports. This may result in difficulties/delays in discharging cargo from those ports in the U.S. Other than that carriers and NVOCCs will still have to comply with the 24 hour rule as it is now U.S. law.

How is CSI being implemented?

It is a voluntary program. It was launched by U.S. Customs in January 2002. They have first targeted the larger seaports in Asia and Europe. They expect that other smaller ports will follow the lead.

Who has signed up to CSI?

·  Ports of Halifax, Montreal and Vancouver - March 2002;

·  Port of Singapore - June 2002;

·  Port of Rotterdam, Netherlands - June 2002;

·  Port of Antwerp, Belgium - June 2002;

·  Port of Le Havre, France - June 2002;

·  Ports of Bremerhaven and Hamburg, Germany - August 2002;

·  Hong Kong - September 2002 (in principle);

·  Ports of Yokohama, Tokyo, Kobe and Nagoya - September 2002 (in principle);

·  All PRC Ports - October 2002 (in principle);

·  All Italian Ports - November 2002;

·  All English Ports - December 2002; and

·  All Spanish Ports - January 2003.

Potential problems with CSI

Many problems are likely to arise such as:-

1. Trans-shipment in Hong Kong

(a) Containers transhipped in Hong Kong (on route to the U.S.) will have to be pre- screened before the vessel loads here. If there is a problem with the container it will be discharged in Hong Kong. The U.S. Customs Service (at present - this may change when systems are developed) will not allow the pre-screening to be done at the first port of loading.

(b) Containers that originate from high risk countries/areas will almost certainly be pre-screened in Hong Kong (once Hong Kong joins CSI). This means the containers will have to be moved from the vessel (or barge) to the terminal where the U.S. Customs (and their detection equipment) will be situated.

(c) The costs incurred in moving any containers will borne by the carriers.

2. Business practice issues

(a) The movement of cargo may be disrupted and/or delayed due to the detailed manifest information not being readily available before the cargo is loaded.

(b) Carriers will have to stop their current practice of adding last minute loads to vessels.

3. Liability

Under the Customs Regulations the carrier and NVOCCs will be held liable for incorrect manifest information notwithstanding that the shipper and/or fright forwarder provided the information.

4. Perishable cargo

Many perishable commodities are harvested and loaded within 24 hours before the vessel sails. Owing to the new manifest requirements (i.e. final seal number and precise cargo quantities) this may now not be possible.

Other shipping security measures adopted by US

Apart from CSI there are two other measures recently adopted to improve security. They are:-

1. US Coast Guard vessel arrival information

All vessels entering US Ports must now give 96 hours instead of 24 hours notice of arrival. Also, the vessel in giving that notice must also provide a list of all persons on board, with date of birth, nationality and passport and/or mariner's official number. The notice must also include the vessel's name, country of registry, call sign, official number, the registered owner of the vessel, the operator, the name of the classification society, a general description of the cargo, the date of departure from the last port and the ports name.

2. Customs - Trade Partnership Against Terrorism (C-TRAT)

U.S. Customs has entered into voluntary partnerships with foreign importers, carriers, brokers, warehouse operators and manufactures to improve container security at all levels of the supply chain. Partners are required to provide U.S. Customs with a executive summary outlining their security procedures (i.e. for manufacturers - physical security, access controls, procedure security, personnel security and education and training awareness measures). In return U.S. Customs will pre-classify their containers/imports as low risk meaning quicker processing into the U.S.

Jamie Stranger

(Registered Foreign Lawyer)

RICHARDS BUTLER

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