INTERTANKO AGM - ATHENS INTERTANKO AGM - ATHENS 20052005

INDUSTRY CHALLENGES - SECURITY INDUSTRY CHALLENGES - SECURITY THROUGH THE EYES OF AN AGENTTHROUGH THE EYES OF AN AGENT

Leigh Phillips – PresidentLeigh Phillips – President

Association of Ship Brokers Association of Ship Brokers and Agents (ASBA)and Agents (ASBA)

Intertanko Associate Intertanko Associate Members CommitteeMembers Committee

Multiport Ship Agency Multiport Ship Agency NetworkNetwork

Houston Int. Seafarers Houston Int. Seafarers CenterCenter

Board MemberBoard Member

Definition of Agency:Definition of Agency:

A Legal Relationship created by an A Legal Relationship created by an Agents Agreement to Represent or Agents Agreement to Represent or Act for the PrincipalAct for the Principal

The Agent is empowered by the The Agent is empowered by the Principal to:Principal to: achieve Savings in Port Expensesachieve Savings in Port Expenses save Time for the Vessel in Portsave Time for the Vessel in Port

To this we now add:To this we now add: ATTENTION TO SECURITY ATTENTION TO SECURITY

PROCEEDURESPROCEEDURES

TODAYS AGENTS VALUETODAYS AGENTS VALUE

PORT COST SAVINGSPORT COST SAVINGS

++ REDUCED TIME IN PORT SAVINGSREDUCED TIME IN PORT SAVINGS

++ATTENTION TO SECURITY ATTENTION TO SECURITY PROCEEDURESPROCEEDURES

== AGENTS VALUEAGENTS VALUE

COST TO THE AGENTCOST TO THE AGENT

Consumed by Security Time DemandsConsumed by Security Time Demands Increase in Liabilities/PenaltiesIncrease in Liabilities/Penalties Immeasurable Risk of Burning out an Immeasurable Risk of Burning out an

Experienced AgentExperienced Agent Increased risk of going out of Increased risk of going out of

businessbusiness

STEAMSHIP ASSOCIATION STEAMSHIP ASSOCIATION OF LOUISIANA (SALA)OF LOUISIANA (SALA)

Distributed Circulars

95

176

280

351

0

50

100

150

200

250

300

350

400

2001 2002 2003 2004

AUTOMATIC MANIFESTAUTOMATIC MANIFESTSYSTEM (AMS)SYSTEM (AMS)

Final Rule – December 2003Final Rule – December 2003 Effective in March 2004Effective in March 2004 All Vessels, including Bulk Vessels, All Vessels, including Bulk Vessels,

carrying Import Cargo must:carrying Import Cargo must: become AMS approved Carriersbecome AMS approved Carriers file their Inbound Manifest file their Inbound Manifest

electronically 24 hours prior to arrival. electronically 24 hours prior to arrival.

Time

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Denial

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Resistance

AcceptanceStage 1

Stage 3

Stage 4

Stage 2

MANAGING THE CHANGE MANAGING THE CHANGE CURVECURVE

SHIP SPARES NOW SHIP SPARES NOW MANIFESTED IN AMSMANIFESTED IN AMS

Vessel/Ship spares that are unladed from one Vessel/Ship spares that are unladed from one vessel intended for export, consumption, repair vessel intended for export, consumption, repair outside the US or transfer to another vessel must outside the US or transfer to another vessel must be manifested in accordance with 19 CFR 4.7a be manifested in accordance with 19 CFR 4.7a (c). The cargo declaration data must be (c). The cargo declaration data must be transmitted electronically to CBP via Sea AMS as transmitted electronically to CBP via Sea AMS as soon as the determination is made to unload the soon as the determination is made to unload the vessel/ship spare(s).vessel/ship spare(s).

““The crux of the problem is CBP’s differing The crux of the problem is CBP’s differing requirements based on circumstances. requirements based on circumstances. Sometimes spares can be handled via a CF Sometimes spares can be handled via a CF 3171, sometimes spares require an AMS 3171, sometimes spares require an AMS entry …” (In Port Arthur even the cases for entry …” (In Port Arthur even the cases for 3171 require two additional items, an 3171 require two additional items, an additional US Crew List or receipt of Crew additional US Crew List or receipt of Crew List, plus a 90 day Port Call List.)List, plus a 90 day Port Call List.)

SECURITY RULES AND SECURITY RULES AND REGULATIONS BURNING REGULATIONS BURNING

UP AGENTS TIMEUP AGENTS TIME

NOANOA CREW CONTROL SECURITY PLANCREW CONTROL SECURITY PLAN OFFSHORE SECURITY BOARDINGSOFFSHORE SECURITY BOARDINGS

Notice of Arrival (NOA)Notice of Arrival (NOA) Final Rule became Effective April 1, 2003Final Rule became Effective April 1, 2003 33 CFR 160.212 specifies an NOA must be filed;33 CFR 160.212 specifies an NOA must be filed; 96 hours prior to arrival (for voyages over 96 96 hours prior to arrival (for voyages over 96

hours) orhours) or 24 hours before entering the port of place of 24 hours before entering the port of place of

destination (for voyages less than 96 hour) destination (for voyages less than 96 hour) NOA INFORMATION CATAGORIESNOA INFORMATION CATAGORIES

1.1. Vessel InformationVessel Information2.2. Voyage InformationVoyage Information3.3. Cargo InformationCargo Information4.4. Information for each Crewmember OnboardInformation for each Crewmember Onboard5.5. Information for each Person On board in Addition to Information for each Person On board in Addition to

CrewCrew6.6. Operational condition of equipment required by Operational condition of equipment required by 164.35164.357.7. International Safety Management (ISM) Code NoticeInternational Safety Management (ISM) Code Notice

NOA CHANGESNOA CHANGES 24 hours before entering a port of place of destination 24 hours before entering a port of place of destination

(for voyages between 96 and 24 hours) (for voyages between 96 and 24 hours) OROR 12 hours before entering a port or place of destination 12 hours before entering a port or place of destination

(for voyages less than 24 hours)(for voyages less than 24 hours) A port or place of destination is defined in CFR 160.204 as A port or place of destination is defined in CFR 160.204 as

“any port or place in which a vessel is anchored or “any port or place in which a vessel is anchored or moored”moored”

An NOA must include EVERY facility or berth the vessel An NOA must include EVERY facility or berth the vessel goes to AND any other place at which it will anchor or goes to AND any other place at which it will anchor or moor.moor.

The USCG uses this information as part of its Maritime The USCG uses this information as part of its Maritime Domain Awareness efforts. If a vessel has a new facility Domain Awareness efforts. If a vessel has a new facility added or goes out to anchorage, clean tanks, or lighter, added or goes out to anchorage, clean tanks, or lighter, they are all “places” under the NOA regs……….even they are all “places” under the NOA regs……….even though according to CBP, the vessel never “left” the port.though according to CBP, the vessel never “left” the port.

Changes come into play more times then not particularly Changes come into play more times then not particularly for you Chemical Tanker Operators changing facility for you Chemical Tanker Operators changing facility rotations is constant and continuous.rotations is constant and continuous.

MOST COMMON MOST COMMON ERRORSERRORS

(See NVMC NEWS)(See NVMC NEWS) Website: http://www.nvmc.uscg.govWebsite: http://www.nvmc.uscg.gov

PENALTY FOR FAILURE TO PENALTY FOR FAILURE TO FILE NOAFILE NOA

Official Tariff Fine: $32,500Official Tariff Fine: $32,500 Plus time lost! - UP TO 96 HOURSPlus time lost! - UP TO 96 HOURS

Example:Example:

$32,500$32,500 CBP FineCBP Fine

++$120,00$120,0000

4 days (96 hrs) x $30,000 pd 4 days (96 hrs) x $30,000 pd hire ratehire rate

==$152,5$152,50000 Potential LossesPotential Losses

THE RESPONSIBLE PARTYTHE RESPONSIBLE PARTY

33 CFR 160.212 States throughout33 CFR 160.212 States throughout::““The Owner, Agent, Master, Operator, or person in The Owner, Agent, Master, Operator, or person in charge of the vessel………….”charge of the vessel………….”

USCG NATIONAL VESSEL MOVEMENT CENTER USCG NATIONAL VESSEL MOVEMENT CENTER (NVMC(NVMC) - ) - Notice of Arrival Instructions Notice of Arrival Instructions HINTS and HINTS and TIPS:TIPS:““If you are a shipping agent, you can have your clients If you are a shipping agent, you can have your clients fill out the spreadsheet on the ship and then have fill out the spreadsheet on the ship and then have them send you a copy when they send it to NVMC.”them send you a copy when they send it to NVMC.”

USCG HEARING OFFICEUSCG HEARING OFFICE““I noted (from your letter) that the vessel made an I noted (from your letter) that the vessel made an attempt to comply with the regulation and that due to attempt to comply with the regulation and that due to an error by your company NOA was not forwarded to an error by your company NOA was not forwarded to the correct office as required by 33 CRR 160.210. the correct office as required by 33 CRR 160.210. However, it isHowever, it is ultimately the responsibility of the ultimately the responsibility of the Master of the vessel for ensuring his vessel meets Master of the vessel for ensuring his vessel meets the security regulationsthe security regulations prior to entering port.” prior to entering port.”

OTHER TIME KILLERSOTHER TIME KILLERS Security PlanSecurity Plan

Agent is either ordered to use a Security Company Agent is either ordered to use a Security Company oror Master permitted Master permitted to perform the CCSP.to perform the CCSP.

No Standard submission / approval of Security Plan by No Standard submission / approval of Security Plan by USCG or CBP USCG or CBP

Security Plan requirements different at every portSecurity Plan requirements different at every port Gate ListGate List

Facility Gate List needs to be resubmitted daily / edited for Facility Gate List needs to be resubmitted daily / edited for every shift change. every shift change.

Vendors do not know in advance who they are going to send.Vendors do not know in advance who they are going to send. Some terminals require information 24 hrs prior to vessel Some terminals require information 24 hrs prior to vessel

arrival.arrival. All terminals have different Gate list rules, delivery rules, All terminals have different Gate list rules, delivery rules,

rules for cars on terminal or require use of terminal rules for cars on terminal or require use of terminal transportation. transportation.

Sometimes we update Gate list 12 times in a three-day Sometimes we update Gate list 12 times in a three-day vessel call.vessel call.

In general, there are no standard rules for Security Plans or In general, there are no standard rules for Security Plans or Gate Lists!!Gate Lists!!

OFFSHORE SECURITY OFFSHORE SECURITY BOARDINGS (OSB)BOARDINGS (OSB)

Adds additional time and frustrations.Adds additional time and frustrations. ISPS inspections or Sea Marshall usually mean ISPS inspections or Sea Marshall usually mean

mandatory OSB = extra coordination / cost for Launch mandatory OSB = extra coordination / cost for Launch (cost for account of Owner/Charterer) (cost for account of Owner/Charterer)

Notices of OSB can come to us 4 Days Notices of OSB can come to us 4 Days oror 4 Hours Out 4 Hours Out Causes changes with the PilotsCauses changes with the Pilots Calls for SARS ABC QuestionsCalls for SARS ABC Questions Must anchor 12 miles out. Requires 4 hr notice for Must anchor 12 miles out. Requires 4 hr notice for

pilot and call to USCG Fusion Centerpilot and call to USCG Fusion Center Inconsistency of ordering OSB’s, and inability to Inconsistency of ordering OSB’s, and inability to

explain to the Owner WHY now, after his vessels has explain to the Owner WHY now, after his vessels has been operating Coast Wise for a week, that his vessel been operating Coast Wise for a week, that his vessel is issued an OSB order.is issued an OSB order.

Challenge for USA AGENTS Challenge for USA AGENTS with the current security with the current security

environmentenvironment The Costs are real, and for some, it probably The Costs are real, and for some, it probably

already cost them their company.already cost them their company. Three Major Tanker Agencies have gone out Three Major Tanker Agencies have gone out

of business in the last four yearsof business in the last four years

All good AgentsAll good Agents All have gone out of business since 9/11All have gone out of business since 9/11 It is speculated that in the wake of the three It is speculated that in the wake of the three

companies going out of business, Tanker companies going out of business, Tanker Operators were left to pay Millions of dollars Operators were left to pay Millions of dollars of Port Expenses a second time.of Port Expenses a second time.

IMMIGRATION RULESIMMIGRATION RULESThe Human ElementThe Human Element

Affects Seafarers the most!Affects Seafarers the most! A special note of thanks to the Houston A special note of thanks to the Houston

International Seafarers Center and many other International Seafarers Center and many other World Ports Seafarers Centers.World Ports Seafarers Centers. Ministry of Hospitality: Call Home / Go Shopping / Relax at Ministry of Hospitality: Call Home / Go Shopping / Relax at

the Center the Center The Chaplin takes a phone on board, they have a van for a The Chaplin takes a phone on board, they have a van for a

trip to Store and to/from the Center. trip to Store and to/from the Center. We can also thank the USCG for working with the We can also thank the USCG for working with the

Center and all the Houston Facilities to give the Center and all the Houston Facilities to give the Seafarers Center the ability arrange their own Seafarers Center the ability arrange their own unfettered access to and from the ships. The unfettered access to and from the ships. The Center is the only entity that can put themselves on Center is the only entity that can put themselves on a gate list without going through the agent.a gate list without going through the agent.

Houston International Seafarers Center service to Houston International Seafarers Center service to Seafarers is indispensable and a bargain for their Seafarers is indispensable and a bargain for their $85 voluntary fee per port call. $85 voluntary fee per port call.

SOLUTION FOR THE SOLUTION FOR THE AGENTS SURVIVAL IN AGENTS SURVIVAL IN THIS NEW WORLD OF THIS NEW WORLD OF

SECURITYSECURITY TRAININGTRAINING TRAININGTRAINING And More TRAININGAnd More TRAINING

CONCLUSIONCONCLUSION

My Challenge to the Owners Operators here My Challenge to the Owners Operators here todaytoday

Take an interest in the recently published Take an interest in the recently published ASBA’s Agents Criteria for Accounting ASBA’s Agents Criteria for Accounting Procedures, Insurance, Training and Testing Procedures, Insurance, Training and Testing Requirements, all geared towards Raising the Requirements, all geared towards Raising the Standards of ASBA Agents.Standards of ASBA Agents.

Vet your Nominated Agent like your Customers Vet your Nominated Agent like your Customers vet your Vesselsvet your Vessels

Expect continuous improvement in Agency Expect continuous improvement in Agency services services

Reward your good agents with compensatory Reward your good agents with compensatory fees, these days, their service is fees, these days, their service is PRICELESSPRICELESS