September 22, 2015
Out of dozens of events scheduled to be held at the premier maritime industry gathering of the year – the London International Shipping Week 2015 that took place earlier this month – only two were explicitly dedicated to exploring bribery risks in the shipping industry.
One TRACE event provided senior compliance officials from TRACE member companies an opportunity to engage in an advanced discussion of anti-bribery compliance challenges in shipping and logistics industries in a roundtable setting. The discussion focused on bribery risks in ports, bribery risks posed by third party agents, and bribery risks associated with facilitation payments. The UK Chamber of Shipping organized a second event addressing bribery risks in the shipping industry around the publication of The Bribery Act 2010. Practical Guidance for the UK Shipping Industry.
Although the discussion at each of these two events was different, one topic that arose in both was the global shipping community’s vulnerability to largely discretionary and often abusive demands for payments on part of the local foreign government officials in ports worldwide, and the high frequency with which these types of demands occur. Participants in the TRACE roundtable discussed examples of vessels being detained and subjected to unjustified inspections, with crew being threatened as a result of a refusal to pay a demanded “fee”.
In response to this issue, TRACE offered its roundtable participants various tools to both prevent bribery demands in the first place and effectively resist the demands when unavoidably faced with them. Among the most effective tips discussed at the event were the following:
Heading off demands –
- Just say “no” (when there is no apparent risk of escalation to a security situation that places the health and safety of the crew at risk);
- Plan ahead and prepare for delays; and
- Reduce the number of middle men as much as possible.
Responding once faced with a demand –
- Ask for clarification on what exactly the government official is requesting;
- Question the legitimacy of the request and ask the official where the requirement for the “fee” is displayed or stated formally; and
- Refuse to pay the “fee” if the official cannot supply official validity, and hold your line by vocally referencing your company’s anti-bribery policy that prohibits such payments.
Reducing bribery risks attendant to ports and the local officials holding posts there should be a high priority for companies in the shipping industry. Using and educating employees on strategies such as the above is a step in the right direction.
For more on this topic, please see the following resources:
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