The obstruction of customs enforcement at privately operated port terminals: A study of Chinese state-owned enterprises

Port terminals which facilitate the import, export, and transshipment of seaborne cargo are predominantly operated by private firms. While private sector involvement in terminal operations has brought many advantages, their profit-oriented interest in deregulation and maximizing cargo throughput can put them at odds with port-level regulatory agencies. This is particularly the case with customs agencies, for which enforcement activities often require slow and intrusive scrutiny of cargo passing through port terminals. In this article, we argue that this tension may cause private terminal operators (PTOs) to obstruct customs enforcement. We identify six mechanisms through which PTOs can obstruct customs enforcement. And we argue the conditions under which PTOs are most likely to so obstruct customs enforcement through a case study of Chinese PTOs. On this basis, we present PTOs as an important stakeholder in efforts to ensure compliance with customs regimes and offer policy recommendations for improving PTO-customs relations in privately operated port terminals.