Table Of ContentPALGRAVE STUDIES IN MARITIME ECONOMICS
Girish Gujar
Adolf K. Y. Ng
Zaili Yang
Contemporary
Container Security
Palgrave Studies in Maritime Economics
Series Editors
Hercules Haralambides
Erasmus School of Economics
Erasmus University Rotterdam
Rotterdam, The Netherlands
Elias Karakitsos
EN Aviation & Shipping Research Ltd
Athens, Greece
Stig Tenold
Department of Economics
NHH – Norwegian School of Economics
Bergen, Norway
Palgrave Studies in Maritime Economics is a new, original and timely
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and global supply chain management, shipping finance, and maritime
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offers an outlet for reviewing trends and developments over time as well
as analysing how such changes are affecting trade, transport, the environ-
ment and financial markets. Each title in the series will communicate key
research findings, shaping new approaches to maritime economics. The
core audience will be academic, as well as policymakers, regulators and
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will often be theoretically informed but will always be firmly evidence-
based, seeking to link theory to policy outcomes and changing
practices.
More information about this series at
http://www.palgrave.com/gp/series/15187
Girish Gujar • Adolf K. Y. Ng • Zaili Yang
Contemporary
Container Security
Girish Gujar Adolf K. Y. Ng
Division of Business and Management Department of Supply Chain Management
Beijing Normal University-Hong Kong Asper School of Business
Baptist University St. John’s College
United International College University of Manitoba
Zhuhai, China Winnipeg, MB, Canada
Zaili Yang
Department of Maritime & Mechanical
Engineering
Liverpool John Moores University
Liverpool, UK
Palgrave Studies in Maritime Economics
ISBN 978-3-319-98133-8 ISBN 978-3-319-98134-5 (eBook)
https://doi.org/10.1007/978-3-319-98134-5
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Preface
This book addresses the security of the global system of maritime trade,
of which containers form an integral and highly critical component. We
consider container and maritime security as synonymous. Thus, we
address container security from its myriad perspectives, for instance, how
to approach it, how to measure it, and how to better secure transconti-
nental shipping. This book focuses on answering the following
questions:
• What is the responsibility of the carrier for container security?
• What is the responsibility of the port for container security?
• What is the responsibility of the dry port/multimodal transport opera-
tor for container security? Which of these stakeholders owns the insur-
able interest?
• Can liabilities arising out of such risks be limited under the limitation
statutes?
• What are the appropriate approaches and methods to undertake secu-
rity inspections and auditing?
Of course, this is not the first (and surely not the last) collaborative
effort on this topic. There has been considerable research on maritime
transport security, maritime safety, security, and piracy (including some
works done by us). In this regard, we focus on container security as books
v
vi Preface
that are completely dedicated to this topic are scarce. However, our ratio-
nale is much more than just filling up the ‘scarcity’ hole. Nowadays,
global supply chains depend a lot on marine containers originating from
different locations around the world. Very often, they need to get through
complicated logistical networks before reaching final destinations and, in
between, involve multiple participants and points of transfer.
Unsurprisingly, many challenges related to security exist during the pro-
cess. For instance, the Cargo Committee of the International Maritime
Organization (IMO) inspects about 15,000 containers annually and
found that a substantial portion contains misdeclared contents. The US
Customs pegs this figure at around 32% based on annual audits of con-
tainers in seven countries. Such misdeclaration maybe a non-invasive
mismatch due to an inadvertent or deliberate error in packing, stuffing,
and the reporting of container contents by consignors for various reasons.
Furthermore, at the dawn of this century, continuous economic growth
and the rising importance of supply chain management are prominent
trends that are on the lips of every policymaker, scholar, and business
executive. Indeed, they have become almost synonymous. Buzzwords in
security are competitive multi-polarity, rising powers, asymmetric threats,
and increasing uncertainty. However, the incommensurability of these
trend lines, the opportunity and integrated growth, and increasing uncer-
tainty and risks all contribute to a dearth of practical dialogues across
much of the strategic and commercial communities. Thus, one should
not be surprised that the majority of commercial and strategic communi-
ties operate exclusively in their own spheres.
This is not helped by the existence of multiple countries and regions
along global supply chains. The inland carriage of containers is governed
by different legal regimes. As such, there is a lack of clarity with respect to
who is liable for security failure. Another example is that the customs
assumes that if a container’s door handle seal is intact, the cargoes inside
are tampered with, despite considerable empirical evidence to the con-
trary. Unless there is a broken seal, locks, or other manifest damage of the
container, the mismatch of cargoes is not considered by the customs as a
trespass. Non-invasive mismatch is detected by the customs only after a
container is opened. Customs may then levy penalties, allow amendment
of manifest, or confiscate the cargoes. In general, the onus of correct
Preface vii
declaration is on the shipping line that handles the containers. However,
it is widely understood that a shipping line cannot examine the cargoes
and, thus, can only trust the information given by consignors.
Sadly, all too often, the aforementioned problems create a negative
perception among stakeholders that increased security automatically
compromises efficiency and smooth cargo flows, or worse, that econom-
ics and strategy cannot inform one another in any productive ways. This
is not helped by discussions on maritime security that are almost always
tactical, myopic, and fragmented. They are vexing issues that urgently
require the exploration of effective solutions. Understanding this, we
strive to address maritime security from a systemic perspective. Our effort
is not just about securing a port or the container, but comprehensively
examining the ways and tools in which relevant stakeholders can work
together effectively so as to build a highly secure and resilient global sys-
tem of maritime trade, while not compromising the efficiency and free
cargo flows that serve as the oxygen of a healthy supply chain.
Understandably, a systemic view needs contributing perspectives from
different stakeholders along the whole system, and collecting such per-
spectives in a single dialogue about a collaborative strategy is far more
complex than it appears. Hence, this book is a means to initiate an active
dialogue on global supply chain security in an environment in which
seemingly contradictory trend lines are prominent. We therefore embrace
the interdisciplinary contexts, account for and represent stakeholders of
all stripes, and maximize the parameters of the subject matter. By doing
so, we hope to sketch a truly comprehensive global strategy for maritime
security in the contemporary world.
We strongly believe that this book will enhance the relevance of mari-
time security nowadays due to the fast changing political and economic
environments. Academically, it is a valuable companion to scholars,
researchers, and students to build upon additional research from a wider
and different perspective. Professionally, it gives a solid foundation to
policymakers and industrial practitioners to improve the decision- making
process and strategies in security, and simultaneously adds value to the
works of consultants and lawyers from the transport, logistics, supply
chain, and insurance sectors. After reading this book, we expect that our
readers will start to seriously consider their tasks and responsibilities from
viii Preface
a new approach, and that innovative and efficient operational responses
will become much more evident.
Before ending here, we want to acknowledge our sponsors and sup-
porters. First, some of the content in this book has been published previ-
ously in the form of a postgraduate thesis and two journal papers. Hence,
we thank the City University of Hong Kong (China) and the publishers
Inderscience and Elsevier for allowing us to reuse some of such materials
(in different formats and versions). These previously published works
include Gujar (2016) and Yang et al. (2013, 2014).
Second, we gratefully acknowledge the support and insightful advice
from the publisher Palgrave Macmillan, the series editor of Palgrave
Studies in Maritime Economics (Strand: ‘Port Economics & Global Supply
Chain Management’) Professor Hercules Haralambides, and the anony-
mous reviewers. On a personal level, Adolf K. Y. Ng thanks his family’s
continuous support to his academic career. Last but not least, we thank
our readers for their vote of confidence to our efforts. We hope they enjoy
reading this book and appreciate what we try to achieve.
Winnipeg, MB, Canada Girish C. Gujar
S eptember 2018 Adolf K. Y. Ng
Zaili Yang
References
Gujar, G. C. (2016). Container Security and Current Legal Regime. LLM thesis,
School of Law, City University of Hong Kong, Hong Kong, China.
Yang, Z., Ng, A. K. Y., & Wang, J. (2013). Prioritizing security vulnerabilities
in ports. International Journal of Shipping & Transport Logistics, 5(6), 622–636.
Yang, Z., Ng, A. K. Y., & Wang, J. (2014). A new risk quantification approach
in port facility security assessment. Transportation Research Part A: Policy and
Practice, 59, 72–90.
Praise for Contemporary Container
Security
“Containerized shipping is key for global value chains. Without ever more inter-
connected maritime transport networks, globalization as we know it could not
have happened. At the same time, the more complex the networks become, the
more important it is to understand and mitigate their security risks. The new
book provides a very timely and comprehensive analysis of key container ship-
ping security issues. It is recommended reading for trade and transport analysts
and practitioners alike.”
—Jan Hoffmann, Chief, Trade Logistics Branch, UNCTAD; President,
International Association of Maritime Economists (IAME) (2014–2018)
“Port security and safety have become a focal and challenging issue as the impacts
of containerization on world trade is growing. This book is a ground-breaking
piece of research full of profound analysis and problem-solving methods for the
stakeholders in the issue.”
—Paul Tae-Woo Lee, Director and Professor, Institute of Maritime Logistics;
Zhejiang University; Associate Editor, Transportation Research Part E
“This timely and much needed analysis of Contemporary Container Security
offers a most valuable contribution to maritime studies. Following both concep-
tual and novel modelling paths, the authors succeed in capturing the various
economic and regulatory aspects associated with container security. By includ-
ing in the analysis the associated security issues in hinterland regions, dry ports,
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