In the past few years, in response to the increased attacks on maritime shipping by Somali pirates there has been increased call for and use of what might call PMSC (Private Maritime Security Contractors).
In particular, some have been advocating utilizing the lessons of the past by issuing letters of marquee. Such letters have an honorable pedigree. In past centuries a Letter of Marque and Reprisal was a government license authorizing a private vessel to attack and capture enemy vessels, and bring them before admiralty courts for condemnation and sale. Nor was this just something done by other nations. Most people don't remember that Article 1 of the United States Constitution lists issuing letters of marque and reprisal in Section 8 as one of the enumerated powers of Congress, alongside the power to "declare War", and because the United States has not renounced privateering by treaty, in theory it could still issue letters of marque.
In fact, Representative Ron Paul (R-TX) called on Congress to "issue letters of marque and reprisal, deputizing private organizations to act within the law to disable and capture those engaged in piracy.
Thus, the main question is whether, from an economic, national security, or public policy perspective, governments should take advantage of these private sector capabilities.
In that regard one should read a law journal article published earlier this year. It is
Reconsidering the Letter of Marque: Utilizing Private Security Providers Against Piracy by Theodore T. Richard and published in the Spring 2010 issue of Public Contract Law Journal.
Richards argues that issuing letters of marquee can actually improve the human rights records of security contractors, which has suffered in Iraq and Afghanistan, primarily due to inadequate government regulation and accountability. "Letters of marque can provide such safeguards by commissioning the recipient as a government agent for speciﬁc purposes. The beneﬁts inherent to the private sector remain while the government controls, licenses, and regulates the private sector's use of force at sea," he writes..
Letters of marque can be used (1) by nations to license their private ships to carry arms for self-defense; (2) by nations to authorize anti-piracy operations by private parties; or (3) by littoral governments, like that in Somalia, to deputize private parties to enforce security and the rule of law in territorial waters.
Letters of marque, of course, can only work if they are viewed as extension of governmental, not corporate authority. In other words, they can't be issued by a shipping company.
The letter of marque is a tool to deputize and regulate private security operating internationally as agents of the state. In the military context, the intent behind the letter of marque was for governments to retain control over commissioned vessels while simultaneously expanding military capabilities.
When privateers exceeded their commission, they were no longer under governmental authority and could be treated like criminals. Such was the case with Captain Kidd: he had a privateering commission, but he exceeded it and became a pirate.
In the law enforcement context, letters of marque deputize recipients with sovereign police powers. Historically anti-piracy privateers were similar to modern American bounty hunters; both were authorized to detain the objects of their commission and paid based on the success of the capture. Clearly the private sector, empowered with the legitimate authority to use force, may supplement public sector law enforcement without undermining the state. Letters of marque simply allow governments to retain their inherent control over the use of force in the international arena.
Another way to ensure control is simply to write in regulation, just as governments now do for private security contractors on the ground.
Letters of marque can be part of the solution to the regulatory problem: the letters contain the rules by which security personnel operate and can be supplemented with further regulation. Just as every phase of privateering became systematized in the eighteenth century, modern security personnel operating in the international maritime environment must be held to speciﬁc procedures and rules of engagement. Letters of marque should only be issued to security ﬁrms able to post a signiﬁcant bond and meet speciﬁc qualiﬁcation and training requirements. Ideally international standards for these requirements would be developed.
Consequences for exceeding or violating commissions are also essential. On the high seas, criminal sanctions for exceeding the authority of a letter of marque exist: offenders can be punished for piracy. Additional penalties would include forfeiture of the bond and potential impoundment of the vessels owned by security personnel.
If a bounty system is used to pay pirate hunters, the bounty could be forfeited. For government contractors, the contract could be subject to termination and the contractor could be subject to suspension and debarment. Tort liability for wrongdoing is also possible.
For those who want to advocate this function for PSC this is a useful article to read.