16 September, 2002
Updated Security Program Executive Summary
SECURITY IN CONTAINER TRANSPORT
Providing a complete picture of the safety and security of our global service network requires us to continually review our processes, follow and comply with the ever-changing and sometimes burdensome legislative and government agency developments both here and abroad, and enhance our operation and business procedures as appropriate.
On the legislative front, the House recently approved the Marine Transportation Antiterrorism Act (HR.3983) which calls for a comprehensive national system of anti-terrorism enhancement. Additionally, the Senate approved the Port & Security Act (S.1214), which is aimed at preventing terrorist attacks on U.S. ports and maritime infrastructure. These two pieces of legislation are now in committee review which will create one single proposal. The target is an early conclusion possibly before the end of 2003. As other pieces of legislation move through the House and Senate, we will be sure to continue pushing for quick passage of cost effective legislation that will maximize security and minimize the disruption to cargo flow.
In addition to the activities on Capitol Hill, there are numerous initiatives underway in the USA (under the Department of Transportation, TSA, MARAD, U.S. Customs, The Coast Guard and the Justice Departments as well as intergovernmental agencies such as the IMO, OECD, International Labor Organization), G-8 and Asia Pacific Economic Community (APEC). In fact, G-8 nations recently met in Alberta and endorsed anti-terrorism measures calling for improved transportation and container security.
There is no question that any programs deployed by government agencies and measures enacted into law, both here and overseas, will likely change the way we do business. We can safely assume that the change will place additional strain on a company’s supply chain and may even add new costs to the equation. While we will strive to keep the cost impact to a minimum, our primary goal is to ensure the smooth flow of cargo as well as the safety of our employees and vessels. We intend to work closely with various governments and agencies to develop and implement programs that will ensure the safe transport of goods around the world.
The U.S. Customs Department is a key government agency involved with security and the flow of international goods; therefore, we are careful to comply with all of Customs requirements, including providing early manifest transmissions, electronic advance arrival notices and vessel inspections involving multiple agencies (FBI, US Coast Guard, US Customs, and INS). MOL also participates in many of Customs programs that are aimed at cargo transportation security, terminal/port security, terrorism prevention, and anti-drug smuggling. A list of the programs we are involved with has been included below for your reference:
Customs Trade Partnership Against Terrorism (C-TPAT)
Container Security Initiative (CSI)
Business Anti-Smuggling Coalition (BASC)
Carrier Initiative Program (CIP) & Super Carrier Initiative Program
Customs Trade Partnership Against Terrorism (C-TPAT) program is being rolled out to all segments of the trade community, one segment at a time. The C-TPAT has recently been released to the carrier community and MOL has registered to participate. This program, which will entail a certification process involving intense scrutiny of a carrier’s service network will be the benchmark for security certification in the transportation industry. MOL is now gathering the necessary information to complete the survey and will be making it's final submission to US Customs shortly. We have already collected and continue to collect additional data to support C-TPAT’s carrier requirements, including security profiles for our key transportation vendors such as ocean terminals, rail carriers and major truckers in the USA. Based upon our long working history with most of our vendors and the initial security profiles we now have on file, we are pleased to report we feel comfortable with the level of security surrounding their operations.
The Container Security Initiative (CSI) is a program that seeks cooperation from foreign ports in identifying high-risk containers, pre-screening containers, and working on advanced technologies that ensure container security. MOL is involved with CSI and is helping to lay the foundation of this program whose success will rely greatly on participation by international agencies and organizations. Participation by such major world ports as Singapore and Rotterdam as well as others in the list of top 20 ports will help springboard this program to global awareness.
US Customs is working to push out our borders and secure the transportation system as tightly as possible. They are working with overseas governments as well as industry to accomplish the best possible programs that address security. They recently proposed a rule that provides that they receive 24 hour notice of B/L information prior to cargo being loaded on a vessel. This is now being reviewed and debated as to how best to carry out such a requirement. Clearly there would be changes to the present methods of cargo movement if this were to become practice and it would add additional time along the supply chain. The goal of US Customs is the early sharing of information and measures are being taken to ensure that this can be done with little impact on the flow of cargo.
Following 9/11, our terminals, as well as the terminal facilities of our alliance partners, worked quickly with the US Coast Guard to establish Facility Security Plans designed to meet minimum guidelines pertaining to:
By addressing security issues in a uniform manner and in cooperation with the US Coast Guard and US Customs, we are confident that we have appropriate preventive measures in place and we are prepared to react to situations that may arise.
MOL (America) Inc.
MOL has appointed James Galligan its Director of Security. This position is based in the company’s North America headquarters located in Concord, CA and works with all of MOL’s global offices to ensure we meet security requirements as they are instituted around the world and to ensure our staff are knowledgeable and trained in this area.
In North America, we maintain high employment standards that include strict screening and adherence by personnel to the codes of conduct outlined in our employee handbook. MOL (America) Inc. has ISO9002 certification and operates a successful Quality Management System (QMS) that provides a framework that ensures our personnel follow documented procedures and provides a forum to address and correct service and security issues.
We require our vendors to meet employment standards that are similar to our own. We are satisfied with our key vendors, however we find it is more difficult to feel the same degree of satisfaction as we move further down the list to smaller vendors, especially when we are not controlling the choice of vendor. In such instances, we will depend upon our customers to follow the necessary steps of ensuring security. As the C-TPAT program is rolled out to other segments of the transportation supply chain we are encouraged by ability to assure a secure system.
We are encouraged by the actions of the terminals and US Coast Guard in developing the Facility Security Plan, which addresses the integrity of terminal employees.
With a history dating back more than a century, we have seen the container trade grow from a port-to-port business, to a fully integrated and intermodal business involving second and third parties. We recognize that strict adherence to tighter security measures is necessary as we move forward into the 21st century.
While participating in U.S. Customs’ programs cannot by themselves guarantee total safety for ourselves, our customers, or the public at large, compliance with these programs will ensure we are doing everything we can to promote safe and secure cargo transportation. We will continue working with various agencies in the USA and abroad as this issue pushes beyond our borders.
This status report will remain a “live” document for the short to medium term and we will update it as developments necessitate. We are also working to post all pertinent security data to our global website www.molpower.com. for easy access by our customers, vendors, and MOL personnel.
For further information, please contact:
MOL (America) Inc.
North America Headquarters
2300 Clayton Road, Suite 1500
Concord, CA 94520
Tel. 925-688-2600 / Fax. 925-688-2670