Foreign involvement in America’s shipping ports has become a top Capital Hill concern with the recent move by a Dubai company to try to take over operations of several Eastern seaports.

Here at the nation’s No. 1 port complex, though, the controversy has failed to gain much traction.

While the ports of L.A. and Long Beach are managed by the two local cities, foreign influence at the ports is high: three of the seven major commercial terminals in both Long Beach and L.A. are run by foreign companies, including two from mainland China. In addition, all but two of those terminals are serviced by shipping companies that are foreign owned.

And while the Southern California port complex has not operated entirely without similar controversy eight years ago Long Beach was prevented from leasing a new container port to Beijing-based China Ocean Shipping Co. (Cosco) few have blinked an eye over foreign involvement here.

“We work extensively with these companies and have for years. It’s international business at its purest,” said Bob Watters, the vice president of Seattle-based SSA Marine, which operates three terminals in Long Beach, including two that serve foreign shippers.

Stevedoring companies such as SSA are responsible for the loading and unloading of cargo, as well as the overall operation of the terminals they lease from the cities, while shipping companies such as Cosco ferry cargo in and out of the ports.

And despite the 1998 controversy over its proposed expansion, Cosco is also among the foreign companies running terminals at the ports. Others include Shanghai-based China Shipping Co.; Yusen Air & Sea Service, a Japanese firm; and Hyundai Merchant Marine of Korea.

In addition, the shippers often enter into partnerships with the terminal operators to help manage the terminals. Such a partnership has been in place for 26 years at Pier J in Long Beach between SSA and Costco

“We have the majority share in the lease but they run the terminal. They understand the system and know what they’re doing. It’s a partnership; it’s business.” said Gao Weijie, chairman of Cosco.

Long-term pacts


A few terminals at the L.A. port are similarly arranged.

China Shipping, one of the largest shipping companies in the world, has an agreement with terminal operator Marine Terminals Inc., which is based in Oakland. Marine also has similar agreements with Evergreen America and Yang Ming Marine Transportation, both based in Taiwan.

Los Angeles-based Eagle Marine is a terminal operator and has a similar arrangement with Singapore-based APL.

Often, the companies share the expenses of equipping and maintaining the terminal, as well as the fees associated with the importing and exporting business, which can be steep.

“Investing in a terminal is very expensive,” Long Beach Port spokesman Art Wong said. “The cranes used to unload and load the ships alone are $7 million to $10 million. So a long-term agreement is the only feasible way to get these companies to invest in the terminal.”

The Southland ports alone collected $6.3 billion last year in dues, according to the U.S. Customs and Border Protection agency. That accounted for more than 21 percent of the total revenue collected by the entire Customs department in 2005.

And while the terminal operation companies are responsible for supplying the security for the individual terminals monitoring entrances and exits the Coast Guard monitors the overall security and has assigned 62 security officers for both ports. Almost all of these jobs are staffed by local union workers.

“You think the (International Longshore and Warehouse Union) is going to let a foreign company come in here and put their own security people out there not a chance,” said Manny Aschemeyer, the director of the Marine Exchange of Southern California, an organization that serves as the traffic control authority for both ports.

Customs officials express little worry about security despite the heavy foreign involvement in running the ports.

“It’s in the best interest of these companies to ensure the security of their terminals,” said Customs spokesman Mike Fleming. “If anything happens at either of these ports that slows the flow of goods, it will have catastrophic effects on both the local as well as national economies.”

However, that view is not shared by everyone. David Olson, a political science professor at the University of Washington who studies West Coast port operations, said he is not convinced all the foreign involvement is benign.

“The outside influences are driving the concern here. If you look at the corporate structure of Cosco, for example, you’ll find the Chinese Army in a prominent position,” Olson said. “You can speculate all day about what that means, but it bears examining carefully.”