DUBAI - In a bid to cover the cost of complying with the International Ship and Port Facility Security Code (ISPS Code), container lines are planning to introduce security charges. The extra expense to bring each ship in line with the ISPS Code will be combined with new charges imposed by some container terminals and levied on customers, industry sources said.
Several freight conferences are assessing the size of the proposed surcharge and will make announcements soon, while independent lines are also expected to recover these extra expenses. The additional costs faced by ocean carriers will be consolidated and then meted out as a surcharge on each box, they said.
Compliance with the ISPS Code involves considerable outlay for both shipowners and container terminal operators. Some major ocean carriers have whole departments dedicated to ensuring that all ships in their fleet meet the new security rules.
Container terminals have responded differently to the financial implications of upgrading security arrangements, with some passing on the costs and others as yet undecided. The UAE ports announced that they ready to comply with the ISPS Code.
The ports' management do not have immediate intention to increase port fees, but, according to one senior port official, "we are looking at that as all the other ports in UAE and around the world and in future all the ports, which invested in ISPS requirements, will eventually have to increase their fees to cover the cost of complying with the new code." He added, however, that no decision has been taken so far.
The tough new international rules are considered to be one of the most important international developments for the port industry. They have worldwide significance having been adopted by the International Maritime Organisation (IMO) in 2002 and included in chapter XI-2 of the Safety of Life ar Sea Convention (Solas) and constitute a mandatory security regime for international shipping and port operations.
The purpose of the Code is to provide a standardised, consistent framework for evaluating risk, enabling governments to offset changes in threat with changes in vulnerability for ships and port facilities.
BY JAMILA QADIR
© Khaleej Times 2004
