Whether you are an existing importer, exporter, trader or a novice in the shipping and trading business, you need to know the secret to understanding sea freight rates before you enter into the business.

1. What are ISPS Charges?

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5. Whether you are an
existing importer, exporter,
trader or a novice in the
shipping and trading
business, you need to
know the secret to
understanding sea freight
rates before you enter into
the business.

6. Unknown, unforeseen and unbudgeted shipping and freight costs
could mean the end game for your business, so they need to be
controlled and monitored closely.
If you have been checking your freight quotes or gone into the
anatomy of a freight invoice, you would have noticed a charge
called ISPS Charge or ISPS Surcharge or simply ISPS.

7. This is a rather important item,
something which has a deeper meaning
than some of the other freight-related
charges.

8. What Is ISPS?

9. Well, it all started after
the 9/11 attacks. The
IMO (International
Maritime Organization)
realized that what
happened in the air
could also happen on
the sea or via the sea.
Thus, the IMO decided
to develop, recommend
and implement a set of
security measures,
applicable to ships and
port facilities around
the world.

10. Purpose Of Isps Code

11. The primary objective of the ISPS Code is to provide a
standardized, consistent global framework across the
maritime world.

12. This will enable the
countries that have
subscribed to the code
to evaluate, detect and
assess the security
risks to the ships
calling at their ports
and take appropriate
measures to
determine the security
levels they must follow
and the corresponding
security/preventive
measures to be taken

13. To institute respective roles and responsibilities of all parties
(governments and government agencies subscribed to the code,
port administration and the shipping and port agencies) concerned,
at a global and domestic level, to ensuring maritime security
To exchange/share relevant security related information
And to assure shipowners that adequate and proportionate
maritime security measures are in place for their ships

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15. Security Levels Of Isps Code

16. The ISPS Code consists of two parts &
three levels of security.
The parts of the ISPS code are:

17. Part A – These are mandatory provisions which talk about the
employment of security officers in the shipping companies, their
ships and port facilities that they call.
Part B – These are recommendatory provisions providing
guidance and recommendations on how the above security plans
must be prepared and implemented.

18. The ISPS Code consists of two parts &
three levels of security.
The parts of the ISPS code are:

19. Security Level 1 – normal – this is the level at which the ships
and port facilities operate under normal conditions. Minimum
protective measures will be maintained at all times.
Security Level 2 – heightened – this is a level that will apply
whenever there is a heightened risk of a security incident. At this
level, additional security measures will have to be implemented
and maintained for that period of time. This time frame will be
determined by the security experts on the ship or at the port
facility.
Security Level 3 – exceptional – at this level, it is considered that
a security incident is imminent and SPECIFIC security measures
will have to be implemented and maintained for that period of
time.

20. Why Is Isps Charged, Who
Charges It And Who Pays For
It?

21. The ISPS code must be
implemented in its
fullest form to ensure
the safety and
protection of all
concerned. For a
shipping line and port,
it means additional
expenses for the
employment of
qualified and trained
personnel capable of
implementing the
security measures
required by the code.

22. There is a lot of
manpower, planning,
and equipment that
goes into the
implementation of the
ISPS code and to
ensure the safety and
security of the ship’s
crew and the staff in
the port.

23. To cover these costs, the shipping lines charge the ISPS
surcharge.
A customer might get charged ISPS surcharge in the form of
Carrier Security Fee and/or Terminal Security Charge.
Carrier Security Fee as the name implies is charged by the carrier
to cover their cost incurred in implementing the ISPS code.