Labor Toolkit

Alternative Port Management Structures and Ownership Models

Marine Services and Port Reform

This section discusses a variety of marine services and how they are affected by port reform. Special emphasis is placed on how these services might be outsourced, concessioned, or privatized.

Marine services are port-related activities conducted to ensure the safe and expeditious flow of vessel traffic in port approaches and harbors and a safe stay at berth when moored or at anchor. “Safe” means that port conditions ensure that vessels using the port, the port environment, and the marine environment are protected from danger. “Expeditious” means that vessels are not unduly delayed and that the vessels’ port transit times, as a part of the total turnaround time in the port, are kept to a minimum.

Although ports may define marine services differently, and may have different methods of providing them, in this section the term is used to refer generally to services having a nautical bearing, be it maritime safety, vessel traffic efficiency, or marine environment protection.

Other services (for example, fire fighting, immigration and customs services, security, and port state control) may also affect port efficiency and safety. While important to the overall operation of a port, these other services are not dealt with in this section.

The specific marine services rendered by a port authority depend largely on the scope of the port’s marine responsibilities and jurisdiction. The scope of the ports’ marine jurisdictions does not follow a general rule, and there exists no international legislation or standard practice that defines the responsibilities of port authorities. Usually, marine services rendered by a port authority are geographically delimited by the area directly under control of the authority, which may encompass only the waterfront of riparian berths (the port’s domain). However, there are countries where the port authority is also responsible for managing lighthouse services outside its immediate area of control. This extended area may cover harbor waters and approaches as far as the open sea.

Harbormaster’s Function

Generally, the harbormaster (or port captain) manages port activities relating to maritime safety and the protection of the marine environ-ment. The legal basis of the harbormaster’s function is usually embedded in a port bylaw or, in the case of a state-owned port, in a specif-ic law or ministerial decree. The harbormaster often has specific legal powers to act in emer-gency situations. Typically, the harbormaster is part of the port authority organization and heads the marine department. In some coun-tries, the harbormaster may work for an inde-pendent public entity such as the coast guard.

The harbormaster is responsible for ensuring the efficient flow of traffic through port and coastal waters (including allocation of vessels to public berths) and—on behalf of the govern-ment or port authority—for coordinating all marine services. The harbormaster operates out of a port coordination center (or Captain’s Room), which is often part of an elaborate ves-sel traffic management system.

Frequently, harbormasters have police powers and act as head of the port police. The main functions of such police are enforcement of the port bylaws, especially with respect to traffic regulations, protection of the environment, and accident prevention. When part of a port authority, the harbormaster also usually serves as head of the pilotage service. In the event that the pilotage service is not part of the port authority, the harbormaster is responsible for coordination between this service and port users. Finally, the harbormaster is sometimes responsible for regulatory oversight of the car-riage and storage of dangerous goods in the port area as well as for ensuring the proper use of port reception facilities.

In view of the public character of the harbor-master’s responsibilities, this function is rarely privatized. To do so would raise a conflict of interest between the public interest (safety, envi-ronment, and equal treatment under the law) and private interests from the port industry. For example, since port time of ships is an impor-tant cost and operational factor, the harbormas-ter will always be under pressure to grant pref-erential treatment to shipping lines. Impartial and consistent application of operational safety measures for ships carrying dangerous or envi-ronmentally sensitive goods such as gas carriers, chemical parcel tankers, and VLCCs is essential to the safe functioning of any port. The harbor-master, therefore, should not function within a purely commercial environment, but must have freedom of action to carry out public tasks in an unimpeded and unbiased manner.

Although the harbormasters might be part of a port authority’s management team, they should be free to operate in their jurisdiction as inde-pendently as possible from the commercial management of the port. In carrying out emer-gency measures in the event of accidents and industrial disasters, the harbormaster should have full freedom of action and possess the ulti-mate authority and responsibility for directing all necessary activities. In a fully privatized port, the harbormaster should not be part of the port management, but should be employed by a national or regional maritime administration.


In a port reform process, pilots often are the first ones to demand privatization. Pilots usual-ly constitute a closed group of professionals (often master mariners), who are keenly aware of their unique position in the port environ-ment. Successful vessel management relies heav-ily on the efficient functioning of the pilot organization, a fact that pilots may use to maxi-mum advantage during port reform.

In many countries, pilots (or pilot organiza-tions) have been more or less successfully priva-tized. This type of privatization, however, car-ries the risk of creating a private sector monop-oly in pilotage services, especially when pilots are privatized on a national or regional scale. Pilotage is an essential part of traffic manage-ment, and safe passage of vessels through a port area requires expert teamwork of a vessel traffic management organization (Captain’s Room), tugs, mooring gangs, and pilots. A private sec-tor pilot monopoly that has the ability to bring port operations to a complete and rapid stop represents a significant risk for ports, carriers, and shippers alike. As a consequence, retaining pilots as part of a port authority’s marine department may be desirable even when other aspects of port management and operations are privatized (see Box 26).

There are two ways of privatizing of the pilotage function. Pilots can be self-employed and work under the oversight of a maritime authority that serves as the regulator and licen-sor of the individual pilots, or pilots can organ-ize themselves into a private company.

The pilotage company should have its own infrastructure and facilities, such as pilot boats, communication equipment, and pilot stations. Sometimes a pilot organization (especially in smaller ports) might also operate a vessel traffic management system (radar). The port authority or maritime administration should regulate the privatized pilot organization regarding:

Tugboat Operations

Tugboat operations are typically carried out by private firms. If the volume of vessel traffic is not sufficient to support a tugboat service on a com-mercial basis, a port authority may be obliged to provide such service itself. Sometimes neighboring ports can share tugboat services to reach volumes sufficient to sustain a commercial operator.

In many instances, traffic density allows for only one private tugboat company to operate in the port area. In such cases, the port authority should regulate the service regarding:

The optimum situation would be a number of tugboat firms competing vigorously in the port. In that event, the port authority should not have to regulate tariffs. Regulation of other aspects of tug operations such as manning can be at the discretion of the port authority and will depend on the local situation.

Mooring Services

Mooring services in smaller ports can be pro-vided by the local stevedore. In larger ports, a mooring service is usually performed by a spe-cialized private firm. Especially in a complicated nautical situation (for example, single point mooring buoys, specialized piers for chemicals or gases, or ports with large tidal differences), mooring activities require expert skills and equipment. A port authority may choose to reg-ulate this activity when only one specialized firm exists. Regulations should include:

Vessel Traffic Services and Aids to Navigation

Vessel traffic services (VTS) are usually part of a port or a maritime authority. Such services are provided in port areas and in densely used mar-itime straits (such as the Dover Channel) or along a national coastline (for example, the coast of the Netherlands). In principle, it is possible to privatize VTS under a concession agreement. VTS that should be regulated by the competent authority should include:

Responsibility for aids to navigation usually rests with a national maritime authority in port approaches and in coastal areas, and with a port authority in port areas. Often, provision and maintenance of buoys and beacons are contracted out. Because aids to navigation are generally part of an integrated maritime infrastructure, the costs of providing these services are included in the general port dues. Therefore, it is difficult to privatize them.

Other Marine Services

The control of dangerous goods for maritime cargoes is usually performed by a specialized branch of the port authority. The same goes for the handling of dangerous goods in port termi-nals. Oversight and regulation of land transport of dangerous goods is normally a responsibility of the central government. The highly sensitive and technical nature of this work makes it inad-visable for privatization.

Waste management services in ports often are privatized under strict control of a port authority or another competent body. Privatization carries risks, however, especially with respect to the disposal of dangerous chemicals. Proper waste management can be expensive for shipping lines. With high costs, ship captains might be tempted to dump waste into the sea or into port waters. Control of such dumping practices is extremely difficult, especially for chemical cargoes. To spread waste management costs, ports can include all or part of the waste management costs in the general port dues. Transport of waste from the ship to a reception facility also poses a challenge, especially in larger port areas. Port authorities should directly provide or organize the provision of transport barges or trucks for this purpose.

The entire waste management system, including personnel and facilities, should be closely controlled by the competent authority. When private firms are engaged in waste handling, the authority should employ experts from its organization to ensure compliance with all relevant laws, rules, and regulations.

Generally, emergency response services are carried out by a variety of public organizations such as the port authority (harbormaster), fire brigade, health services, and police. Some ports have sophisticated tools available to aid in crisis management, such as prediction models for gas clouds. Such tools are often integrated in a traf-fic center of the local vessel traffic management system (VTMS). Private firms (for example, tug-boat companies) may play a subsidiary role in crisis management in the event that they are equipped with fire-fighting equipment. Larger ports use patrol vessels and vehicles for a vari-ety of public control functions. In some ports, such patrol vessels also have fire-fighting equip-ment on board. When a port does not have patrol vessels available, a contract with a tugboat company should be arranged to guarantee avail-ability of floating fire-fighting capability. Port patrol services are part of the harbormaster’s resources and, therefore, should not be privatized.

Control of dredging operations by a port authority is of utmost importance. Often, the port authority or the competent maritime administration does not have enough expertise to exercise sufficient control over both mainte-nance and capital dredging. Port authorities with large water areas under their control should employ sufficient competent personnel to prepare dredging contracts and oversee dredging operations. Sounding is an activity that should preferably be carried out (or contracted out) by the port authority itself. Dredging is usually carried out by private firms. It might be cost effective for some ports to use their own dredges, especially when continuous and important maintenance dredging is required.

Box 27 summarizes the prevailing approaches for handling the most important port functions.


How To Use The Toolkit


Framework for Port Reform

The Evolution of Ports in a Competitive World

Alternative Port Management Structures and Ownership Models

Objectives and Overview

Evolution of Port Institutional Frameworks

Port Functions, Services, and Administration Models

Port Finance Overview

Port Reform Modalities

Reform Tools

Marine Services and Port Reform

Legal Tools for Port Reform

Financial Implications of Port Reform

Port Regulation:
Overseeing the Economic Public Interest in Ports

Labor Reform and Related Social Issues

Implementing Port Reform


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