Central and South America – Increased Risk of Drug Smuggling

Members and Assureds will be aware, from the Club’s Circular in May 2020, of a case where illegal narcotics were found on board a vessel in Mexico and the vessel and crew were detained (click here to access the Circular). However, the number of incidents of drug smuggling by ships have increased in recent years and is not limited to Mexico. Countries where drugs are loaded include Colombia, Ecuador, Panama, Brazil, Peru, Mexico, Venezuela, North America, and China.

When there is a drug smuggling incident, the vessel and its crew will very likely be detained by the authorities for long periods of time for forensic investigations or criminal proceedings to take place. Ship owners may be exposed to significant loss of hire, cargo claims especially where cargo is perishable, high fines and even forfeiture and sale of the vessel in certain jurisdictions.

Some recent information from the Club’s correspondents includes:

• A Circular on Drug Smuggling on Bulk Carriers out of Brazil on the rise by Representascoes Proinde Ltda, Brazil. This includes detailed background information on the problem, examples of where drugs are hidden inside containers and brought on-board vessels, or attached to the hull of the ship, and suggested preventative and responsive measures. The Circular is available here;
• Globalpandi, SA, Venezuela, reminds us that drugs concealed on a ship’s hull is always a potential risk, and they recommend Owners carry out independent precautionary underwater inspections in certain circumstances before official/mandatory inspections.

All Members and Assureds should be aware of the risks of drug smuggling and take reasonable measures to prevent it. This may include:

• contacting local agents or the listed Club correspondents for up to date information on the latest preventative/precautionary measures;
• for Operators and Masters of vessels trading on high risks routes, involving Central and South America, to be familiar with and to ensure that their on-board procedures are in line with the IMO Revised Guidelines for the Prevention and Suppression of the Smuggling of Drugs, Psychotropic Substances and Precursor Chemicals on Ships Engaged in International Maritime Traffic (Resolution FAL.9(34) adopted on 30 March 2007) – available here;
• incorporating the BIMCO U.S. Anti-Drug Abuse Act 1986 Clause for Time Charter Parties 2013 (available here) into time charters, with appropriate amendments, so that Charterers are generally liable for the costs and delays caused by narcotics concealed on board the vessel.