Container Seals

Corporate Policy and Procedures

Contents:
1. Introduction

2. General Policy & Objectives

3. Ordering Seals

4. Inventory & Release Control of Seals

5. Contract and/or Subcontracting

6. Sealing Procedures

7. Affixing Seals

8. Sealing Empty Containers

9. Vessel Seal Procedures

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1. Introduction
Maersk Liner Business (ML Interbrand’s consisting of container booking
accepting entities Maersk Line, Safmarine, MCC, Seago Line, Sealand
and Hamburg Süd) is committed to showing constant care to prevent
breaches of security associated with its operations and ranks security
considerations equally with commercial and operational factors in
managing its operations.

Maersk (APMM) is a validated (most recently re-validated in 2015)

member of the Customs-Trade Partnership Against Terrorism (C-TPAT)
program, through which we advocate and require best practice
solutions to strengthen the security in the parts of the supply chains for
which we are responsible. C-TPAT also requires seal insurance and
control policies that are audited by US Customs every 4 years. The
requirement to affix ISO compliant seals on laden containers is also
governed by the ISPS (International Ship and Port Facility Security)
Code, its American pendant MTSA (Maritime Transportation Security
Act of 2002), the U.S. Safe Port Act, and advocated in the EU
Authorised Economic Operator (AEO, of which Maersk Line has been a
certified member since October 2008 through its parent, A.P. Moller-
Maersk A/S) scheme and the voluntary customs framework developed
by the WCO (World Customs Organisation).

The purpose of this document is to describe “the life of a seal”, to

clarify the responsibilities for container seal procedures including
ordering, and to provide guidelines on what should be done when seals
are missing or have been/are suspected to having been manipulated.

Container seals referred to in this document are those seals that are
used to satisfy global customs security conveyance requirements, i.e.
the bolt or cable seal affixed by the shipper, the bolt seal affixed when
MLB first takes receipt of a container, or the bolt or cable seal affixed
by customs authorities after having carried out a legitimate opening
and closing of container doors as part of an inspection. Additional seals
may be affixed to satisfy other requirements, such as veterinary and
indicative seals.

This document does not provide detailed local procedures; it provides

the corporate minimum acceptable policy that ML offices around the
world shall apply to ensure that best possible procedures are
implemented and followed to ensure the integrity of each containerised
shipment.

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This document is maintained by the ML Shore-Side Security Adviser –
mail address (MLHSSE@maersk.com). Unless otherwise stated,
inquiries must be directed accordingly.

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2. General Policy & Objectives
A laden container loaded onboard a MLB operated vessel, and any
laden container carried under a MLB Transport Document, shall be
sealed according to guidelines and instructions set out in this document.
The objective of affixing a container seal to the container doors
immediately after completion of stuffing is to minimize the risk of
unauthorized access to a container, thereby reducing the risk of theft,
the placing of contraband, and of human trafficking. It is therefore
required that a laden container is always protected from unauthorized
access via the doors by a bolt seal or another seal type meeting, as a
minimum, standards according to ISO 17712:2013 and any successor
and amendment of that standard for high security seals.

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3. Ordering Seals

A. Seal Ordering Procedure for Africa, Europe & Latin

America cluster (Supplier: Cathay Seals)

Agents in country clusters located in Africa, Europe and Latin America

must place their orders with Cathay Seals directly via the internet at
www.cathayorder.com. Cathay Seals will directly co-ordinate with
agents, provide order confirmation, shipping details and arrange for
transportation.

Agreed delivery terms with supplier are Delivery at Place (DAP, Inco
terms 2010).

Invoices will be sent direct to the ordering entity and Payment shall be
due and payable latest Current + 90 (ninety) Days from receipt of
complete delivery and correct invoice. For overdue payments, Cathay
Seals are entitled to charge fee for overdue payment.

Go to www.cathayorder.com, select “Purchasing Portal” and enter initial

password/user-id. If you do not have a user-id/password, supplier will
assist in registering and providing user-id & password for new user.

Although the web ordering system provides agents greater flexibility in

terms of ordering, but to facilitate supplier in production planning, cost-
reduction, agents should consolidate seal requirement and should
follow the semi-annual ordering scheme to maximum possible extent. It
will also help agents to reduce their cost and time as well.

Agents place order by 1 November for delivery primo January. Delivery

by vessel.
Agents place order by 1 May for delivery primo July. Delivery by vessel.

Additional guidelines:
• Lead time is 14 days for orders placed outside semi-annual
ordering scheme and to that you should add transit time by sea
from China
• For questions regarding orders, agents should first contact
Ms. Sylvia Tan, Cathay Seals by mail
sylvia.tan@cathayseal.com.sg or by phone +65-97451380.
• For urgent orders, please select the "airfreight" option when
ordering through the internet. This delivery option is not included
in the price, and must be avoided, if possible.

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 • Note for SAM and CAM Areas: Red seals are required for empty
containers and should be included when placing orders for blue
seals

B. Seal Ordering Procedure for Asia/Oceania, Middle

East/South Asia & North America cluster (except
India & China)
(Supplier: SHANGHAI XINFAN INDUSTRIAL
CORPORATION)

Agents in country clusters located in Asia/Oceania, Middle East/South

Asia & North America (must place their orders with Xinfan directly via
the internet at http://order.xfseal.com. Xinfan will directly co-ordinate
with agents, provide order confirmation, shipping details, arrange for
transportation.

Please share the Purchase Order (PO) No. with the supplier while
placing the order for your requirement. Agreed delivery terms with
supplier are Delivery at Place (DAP, Incoterms 2010) and lead time for
Asia/Oceania & Middle East/South Asia is 2 weeks and for North
America is 3 weeks.

Invoices will be sent direct to the ordering entity and Payment shall be
due and payable latest Current + 90 (ninety) Days from receipt of
complete delivery and correct invoice. For overdue payments, supplier
is entitled to charge fee for overdue payment.

Go to http://order.xfseal.com and enter initial password/user-id. For

your first order, please contact serene_zhao@xfseal.com for further
information.

Although the web ordering system provides agents greater flexibility in

terms of ordering, but to facilitate supplier in production planning, cost-
reduction, buyers/agents should consolidate seal requirement and
follow the semi-annual ordering scheme to maximum possible extent. It
will also help buyers/agents to reduce their cost and time as well.

Additional guidelines:
• For questions regarding orders, agents should first contact:
Mr. Raymond Kim Ng, Shanghai Xinfan by mail
raymondng@xfseal.com or by phone +65-8198 3218.

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 • For urgent orders, please select the "airfreight" option when
ordering through the internet. This delivery option is not included
in the price, and must be avoided, if possible

C. Seal Ordering Procedure for Mainland China (PRN,

PRE & PRS) clusters

1. North China (PRN) cluster (Supplier: Shaoxing

Mega Fortris Seals Co., Ltd.)

Agents located in North China (PRN) cluster must place their orders
with Shaoxing Mega Fortris Seals Co., Ltd. They will directly co-
ordinate with agents, provide order confirmation, shipping details,
arrange for transportation.

Agreed delivery terms with supplier is Delivery At Place (DAP -

Incoterms 2010, including China VAT Taxes) and payment term is Net
90 (ninety) days from receipt of complete delivery and correct invoice.

2. East China (PRE) and South China (PRS) clusters

(Supplier: SHANGHAI XINFAN INDUSTRIAL

CORPORATION)

Agents located in East China (PRE) and South China (PRS) clusters
must place their orders with Shanghai Xinfan Industrial Corporation.
They will directly co-ordinate with agents, provide order confirmation,
shipping details, arrange for transportation.

Please share the Purchase Order (PO) No. with the supplier while
placing the order for your requirement. Agreed delivery terms with
supplier are Delivery at Place (DAP - Incoterms 2010, including China
VAT Taxes) and payment terms is Current + 90 (ninety) Days from
receipt of complete delivery and correct invoice.

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4. Inventory & Release Control of MLB Seals
Control and storage of seals is critically important in ensuring cargo
integrity. Procedures must be in place for MLB agencies and
contractors/subcontractors for monitoring usage and recording seal
numbers issued, and such records must be maintained for a 5-year
period. Furthermore, such records must include the name of the person
releasing the seals.
This could be captured in an Excel sheet like the below:

Documentation must be ready for prompt call-off in case of audits and

cases where seals have been misused or manipulated. Unused seals must
be kept in a secure and locked area inside a closed cabinet with access
restricted to authorized personnel only to avoid theft and/or manipulation.

A number of major shippers and service providers receive MLB seals in

larger quantities. Where this is the case, such entities must take
responsibility similar to MLB.

While above are minimum requirements, it must nevertheless be

recognized that when seals are issued, the process ownership and
responsibility is transferred to shippers and their representatives. The real
value and benefit of the seal is upon it being affixed to a container
immediately after completion of stuffing a container and closing of the
doors, and from there on the seal marks the integrity of the cargo or,
where applicable, the empty container.

Consumption of seals must ideally follow the FIFO (first-in-first-out)

principle.

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5. Contracting and/or Subcontracting
Whenever a subcontracted service is being provided (e.g. barging,
trucking, feedering, train, warehousing, terminal) this seal SOP must be
thoroughly discussed to ensure all implications and requirements are
fully understood and complied with by all parties involved, especially in
regard to the seal reporting procedures.

Subcontractors must also understand, and contractually accept, that

delivering or accepting seal discrepant containers may present them
with delays, extra costs and liability. This may have serious safety and
security consequences for their staff and legal consequences for their
company.

All parties receiving and handing out seals on behalf of MLB must sign
for receipt of the seals entrusted to them, confirming herein that seals
will at all times be kept under lock. They must also keep proper
documentation regarding to whom, how and when they delivered each
seal, and such records must be maintained for a 5-year period.
Documentation must be presented to MLB representative upon request.

An Excel or similar sheet like the below could be used:

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While it is our policy that seal checks and inventory control are
performed as outlined in this document, there are exceptions to it in
some locations where – due to industry custom or practice – some of
the above is not or only partly carried out.

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6. Sealing Procedures
It is the obligation of the Shipper to ensure that containers are sealed
immediately and correctly upon completion of stuffing, that the seal
number is recorded on the Transport Document, and that it is reported
promptly to MLB.

Whenever a container changes custody the responsibility and seal

check obligation is transferred to the party in whose custody the
container is placed. This includes the pull test described in 7.1 and the
noting down on documentation of seal number(s). Each party accepts
responsibility for having received a container duly sealed and will be
responsible for delivering the container to the next party in the same
condition with the seal(s) intact. The last party - normally the
consignee/end receiver - shall be responsible for removing the seal.

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7. Affixing Seals
Immediately upon completion of stuffing at the shipper’s or the
consolidator’s premises, the container must be sealed with either a
shipper seal, a ML seal, or a mandatory seal applied by authorities. As a
minimum, the seal must meet the standards according to the ISO
17712:2013 and any subsequent version of that standard for high
security seals. For optimal security such seal must be placed in the
SecuraCam position (as visualised below - red oval). Where this is not
possible, the seal must be placed on the right-hand door, through the
left-hand locking bar door handle linking the door handle with the
retainer (green oval). If these positions are occupied (e.g. by other
seals) then the seal must be affixed on the right-hand locking bar door
handle. The unique seal number shall be reported by the shipper
soonest after sealing the container, and latest when submitting the
shipping instruction, for update in RKEM and GCSS.
Other seal numbers, such as shipper specific plastic or strip seals,
veterinary seals, and customs seals affixed to containers must also be
captured in RKEM and GCSS.

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7.1 Physical Procedure of Affixing Seals
The first step is to ensure the container locking mechanism has been
properly applied and functioning. There should be no obvious signs of
tampering with either the rivet that holds the end of the locking handle
in position, or the bolts which hold the seal retention mechanism in
place on and around the handle. Any apparent signs of tampering or
malfunctioning should be immediately reported to local MLB
maintenance and repair staff so a decision can be taken as to whether
it is necessary to withdraw the container from service. Consistent
issues must be elevated to Equipment.

Bolt seals come in two parts, namely the 'Pins' and the 'Barrels'. MLB
seals are white in colour (brand neutral) and have 'ML' followed by a
two-letter country code and a seven-digit number on the head (e.g. ML
CN1234567). However, Hamburg Süd is the exception as Hamburg Süd
operates with a different seal ID structure (for historical reasons).
The seal must be examined to ensure it is not damaged and that no
attempt appears to have been made to manipulate it.

When affixing the seal, pressure must be applied until a definite ‘click'
is heard, ensuring that the pin has engaged itself firmly into the barrel
mechanism. It is vital to ensure that the pin has been fully engaged by
moving both pin and barrel a certain amount within the locking
mechanism. Both the pin and the barrel must be engaged correctly and
not merely give the appearance of being so.

A final strong pull on the barrel of the seal to ensure it is properly

engaged with its pin completes the affixation process.

7.2 Seal checking and removal

Occasionally, it is necessary to investigate whether a seal has been
properly affixed and has not been manipulated; the following points
should as a minimum be checked:

(a) Are there are any signs of manipulation with the container
locking mechanism or the rivet holding the shoulders of the locking
arm?

(b) Does the seal number correspond with relevant paperwork? Does
numbering and marking correspond with MLB visual identity?

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 (c) Can the pin move at all within the barrel? If not, is there any
evidence of glue or other substance holding the pin within the
barrel?

(d) Are there are any signs that the pin may have been cut and
glued back together, particularly at the point just below the head of
the pin that is normally masked by the locking mechanism?

(e) Does the Customs or TIR plate overlapping the left-hand door,
appear to have been bent and subsequently brought back into place
again?

If all the above checks do not reveal causes for concern, the seal check
can be considered satisfactory.
A seal check should be made immediately prior to unstuffing. The seal
can be cut off using a pair of bolt cutters approximately half way down
the pin.
Both parts of the seal must be kept until it is established that the load
is intact. If there are any discrepancies, the pertinent Customer Service
Claims address must be advised, to activate their local procedures.
Customer Service Claims will consider whether to raise with Cluster
Country Security.

Whenever seals are found to be missing or manipulated and the

integrity of the shipment compromised, CS claims and, where deemed
pertinent, cluster security staff must be promptly notified with full
details. Documents will be annotated to this effect and on the spot
investigations shall be carried out. CS Claims will provide on-line
guidance as to whether a surveyor, MLB CS claims and/or security,
local customs and/or police, port officials, the P&I Club, etc shall be
notified. Any costs associated therewith (survey fees, handling,
transport, storage etc.) must be recovered from the party delivering
such container.

7.3 Reporting Procedures

When a laden container is taken into our custody or that of our
receiving agent or the vendor appointed to do so (terminal, depot, ICD,
trucker, etc), it is our policy that seal checks must be performed.
Where a container is received with no seal affixed or a high security
seal was not used by the Shipper, MLB will affix a ML seal immediately
upon taking receipt and promptly update RKEM and GCSS.

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Where a local policy is in place, the shipper shall be invoiced for such
sealing. A terminal subject to national interpretation of the ISPS Code
and its Port Facility Security Plan (PFSP) might refuse taking receipt of
a laden container without a seal affixed.

When a seal is broken for inspection purposes, the original seal number
should be checked and the new applied seal updated in the systems
notating the reason for the seal change. The broken seal shall, where
possible, be placed inside the container.

Minimum requirements for checking and reporting are as per below:

1. At first gate-in:
Upon first gate-in under MLB custody, the seal(s) must be
checked to determine if it/they has/have been manipulated with.
Gate staff must be familiar with common circumvention
techniques.
2. At last gate-out:
Upon last gate-out for delivery leaving MLB custody, the seal(s)
must be checked to determine if it/they has/have been
manipulated with. Gate staff must be familiar with common
circumvention techniques.

Where more stringent procedures and requirements are already in

place today – either voluntarily or required by the service provider –
involving e.g. seal number verification, such should obviously not be
changed.

For refrigerated containers, please also refer to the Reefer Acceptance

and Operations Manual (RAOM) for requirements pertaining to
veterinarians’ seals.

Where tarpaulins are used on open top containers, also the seal cord of
the tarpaulin must be sealed so that the container as a whole is sealed.
A high security bolt seal will not fit and is not required. Only the seal
affixed to the door must be captured in systems.

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8. Sealing Empty Containers
Empty containers loaded in ports in Africa, South and Central America,
and Papua New Guinea must be sealed with red seals prior to loading to
prevent illegal use of the containers for contraband and stowaways,
and to ease the identification of empty containers in discharge ports.
Empty containers that are being sealed must be inspected internally,
including for false end walls and for contraband and stowaways in
cabinets. Residual cargo, lashing material, dunnage and debris must be
removed, and the container cleaned, prior to sealing.

Red seals must not be used for laden containers.

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9. Vessel Seal Procedures
MLB owned container vessels order seals through Maersk Line offices in
port of call. Maersk Line offices account for use as set out in chapter 4,
and vessels are required to maintain a similar consumption record
system readily available for inspection as and when needed.

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