In the fight against piracy, shippers reverse course and arm themselves

By Patrick Cullen

The international shipping industry and the governments that are ostensibly supposed to protect it have begun to radically rethink their long-held aversion to private armed protection at sea. The shift illustrates the inability and/or unwillingness of states to provide security, and presages potential ethical and legal controversy as the lines between commerce and state authority become increasingly blurred.

For decades, both the international shipping industry and the governing bodies that oversee it have been critical of the concept of putting armed guards on commercial vessels in order to protect them from violence — and piracy in particular — at sea. From the perspective of private industry, hiring armed guards has traditionally been viewed as a costly and risky move that creates more liabilities (financial, legal, and reputational) than it resolves. Furthermore, the shipping industry has also balked at the idea of paying for a service that it expects the world’s navies to provide for them free of charge.

As recently as June 2010, a host of public and commercial maritime industry stakeholders — including major shipping organizations — explicitly stated that "the use of armed guards is not recommended" in a Best Management Practices maritime security document designed to offer shippers advice to mitigate the threat from Somali piracy.

States and international organizations such as the U.N. International Maritime Organization (IMO) and the International Maritime Bureau have long underscored the importance of maintaining the classic division between the state and the market, with the former maintaining a monopoly of the legitimate use of force, and the latter enjoying the privileges granted by this state protection.

The shift toward the acceptance of armed private security on ships has been recent and dramatic. In an unprecedented announcement last May, the IMO issued guidance to governments and shippers on how to engage with "privately contracted armed security personnel," and many states have followed in the IMO’s wake, issuing similar policy announcements outlining their acceptance of armed private security teams operating onboard commercial vessels. And only weeks ago, on March 28^th, BIMCO, the world’s largest international shipping organization, issued a standardized guard contract (GUARDCON) intended to help shipping companies responsibly select and manage teams of armed guards provided by specialized maritime private security companies. The same maritime industry players that were traditionally averse to the idea of placing armed guards on commercial vessels have now positioned themselves as key players involved in legitimizing this practice. This includes maritime insurance brokers and Protection and Indemnity insurance clubs that have begun to accept, and even endorse, the use of private armed security at sea.

So what has changed? Somali piracy has shifted from a small-scale and purely regional risk to a mature threat from professionalized piracy syndicates extending beyond Somali waters into the Indian Ocean and beyond. And recognizing that the current multinational and unilateral naval efforts to curb Somali piracy are falling short, governmental actors have sought to harness and regulate this emerging practice rather than ban it outright.

However, due to the novelty of the armed maritime private security, as well as the transnational and multi-jurisdictional nature of the global shipping industry, navigating this legal environment remains difficult at best. Placing armed guards on board ships has proven to be an effective method of deterring pirate hijackings — to date, no ship with an armed escort has been hijacked — but the use of armed guards poses its own set of serious risks. Last month, two armed Italian sailors on board an Italian flagged commercial vessel were caught and charged with murder by the government of India after allegedly shooting innocent fishermen within India’s exclusive economic zone. Many commentators point out that it may only be a matter of time before a similar incident occurs with a private security team.

The shift in attitudes among shippers and states is just another illustration of how the management of risk is evolving from the reactive to the proactive, and how the responsibility for providing security is becoming increasingly fragmented between states and the market.  

Patrick Cullen is an analyst in Eurasia Group’s Comparative Analytics practice. Patrick is an expert in maritime private security, and is the editor of "Maritime Private Security: Market responses to piracy, terrorism and waterborne security risks in the 21^st century."