By now, you may have learned that 17 metric tons of cocaine have been seized from the MSC Gayane by federal authorities on Tuesday, June 18th, at Philadelphia’s Packer Marine Terminal.  MSC has since been notified by United States Customs and Border Protection (CBP) that their C-TPAT certification has been suspended for a period of 90 days.

MSC has published the following statement in response to the seizure and suspension:

“Following the incident involving MSC Gayane, which was widely reported in the media on June 18th and involved several U.S. law enforcement agencies discovering a large amount of contraband onboard the vessel, we have been notified by U.S. Customs and Border Patrol (USCBP) that our Customs Trade Partnership Against Terrorism (CTPAT) certification has been suspended for ninety (90) days.  No further information is being provided by U.S. Customs at this time as the investigation is ongoing.

MSC is committed to actively working with the authorities to reinstate our certification as soon as possible.  MSC takes this matter very seriously and is grateful to the authorities for identifying any suspected abuse of its services.”

While MSC and its 2M partner Maersk have both confirmed that all services will continue to operate without disruption, we would like to alert you to the potential effects of MSC’s C-TPAT certificate suspension:

  • Any importers who are C-TPAT certified and/or require their vendors to be C-TPAT certified may suspend booking activities with MSC until further notice.  This would have a cascade-effect on the market as importers who normally use MSC’s services would be forced to book shipments with other carriers.
  • Assuming the first point, and given current market conditions, short-term spot rates are likely to increase in July, and the market is likely to see acute space shortages for the foreseeable future.
  • As a result of the C-TPAT certificate suspension, MSC vessels or shipments may be subject to higher inspection-rates by CBP at US ports of entry.  This would lead to delays in cargo-delivery and disruptions to vessel schedules.

At this time we do not recommend any changes to your carrier-selection as we fully-assess the impact and ramifications of MSC’s C-TPAT certificate suspension.

If, in the coming days, we notice a sharp deterioration in MSC’s service levels, or significant delays associated with USCBP’s decision, we will alert you accordingly.

Shapiro will continue to monitor the situation and provide updates as they become available.