46 CFR Subchapter M Compliance Options TSMS Process

46 CFR Subchapter M Compliance Options & TSMS Process Dennis Bryson District Manager ABS-Americas Gulf District © 2016 American Bureau of Shipping. All rights reserved. © soulofathens. com

Subchapter M Current Landscape l Final Release July 20 th, 2016 l New vessels with keel laid after July 20 th, 2017 are required to comply with all requirements to obtain USCG COI l Existing Vessels need to comply with most requirements by July 20 th, 2018 n COI implementation begins July 20 th, 2018 for existing vessels 2

Subchapter M Current Landscape l Certificates of Inspection (COI) for the towing vessel fleet will be phased in gradually over a four year period, beginning July 20, 2018. Each company will be required to obtain COI’s for 25% of their fleet every year over the four year period. 3

Compliance Options l 2 Primary Choices for the owners/operators n U. S. Coast Guard Option n Towing Safety Management System (TSMS) Option § Initial inspection scheduling at least 3 months before § Application for inspection at least 30 days before § Vessel must have audit before COI (TSMS Option) 4

USCG Option l U. S. Coast Guard Option n Annual USCG Inspections USCG Conducts required drydocking Inspection USCG Conducts required Internal Structural Exam (ISE) – No Company Safety Management System required § Initial inspection scheduling at least 3 months prior to COI § Application for inspection at least 30 days prior to COI 5

Towing Safety Management System (TSMS) l TSMS must be in accordance with 46 CFR Part 138 l 138. 205 – Purpose of a TSMS n n The purpose of a TSMS is to establish policies, procedures, and required documentation to ensure the owner or managing operator meets its established goals while ensuring continuous compliance with all regulatory requirements. The TSMS must contain a method to ensure all levels of the organization are working within the framework. Requires the involvement of an approved Third Party Organization (TPO) 6

Advantages of TSMS Option l Establishes a comprehensive quality control system throughout the company which increases the safety and efficiency of all towing vessel operations. n n n Establishes clear, well defined roles & responsibilities within the organization Can be scaled for company size/type Continuous Compliance l Companies electing the TSMS option will be afforded greater flexibility to complete required surveys and audits, which may reduce vessel down time. l USCG will reduce the scope of their COI inspections. 7

TSMS Options – Options within the Option l External Survey Program l Internal Survey Program Both Options require Third Party Organization (TPO) Involvement Both Options require 2 distinct and separate events 1. Vessel Survey 2. Vessel Audit 8

TSMS Roadmap to Compliance l Company makes TSMS Selection n International Safety Management System (ISM) Responsible Carrier Program (RCP) Stand Alone SMS compliant with Sub M l Company signs a Master Service Agreement with TPO l Company makes “Internal Survey” or “External Survey” selection 9

TSMS Options – External Survey Option l External Survey Program n n n n Owner/Operator selects a TPO reviews and approves TSMS TPO conducts external company Safety Management System Audit TPO Issues TSMS Certificate (for non ISM Companies) TPO conducts external vessel audits TPO conducts annual vessel surveys TPO conducts mandatory drydock surveys TPO conducts mandatory Internal Structural Exams 10

Compliance Options - TSMS l Internal Survey Program – Owner/Operator selects TPO n n TPO reviews/approves TSMS and conducts all external management and vessel audits. Company can then choose to perform annual vessel surveys and drydock/internal structure exams either with their own personnel, or a contractor. Internal Surveys need not be completed as one event but may be done over the course of the year. Company “Internal Surveyors” qualifications are to be similar to those of an External TPO Surveyor: – High School Diploma or equivalent – Must have at least one of the following: v 4 years experience working on towing vessels as master, mate (pilot), or engineer, or v Other relevant marine experience such as USCG Marine Inspector, military personnel with relevant maritime experience, marine surveyor, accredited marine surveyor, experience on vessel of similar operating and physical 11 characteristics

Compliance Options - TSMS l Internal Survey Program (Annual Surveys) n Requirements for this program are: – Procedures for surveying and testing described in § 137. 215; – Equipment, systems, and onboard procedures to be surveyed; – Identification of items that would need repair or replacement before the vessel could continue in service, such as deficiencies identified on Form CG– 835, ‘‘Notice of Merchant Marine Inspection Requirements, ’’ noted survey deficiencies, non-conformities, or other corrective action reports; – Procedures for documenting and reporting non-conformities and deficiencies; – Procedures for reporting and correcting major non-conformities; – The responsible person or persons in management who have the authority to: v Stop all vessel operations pending the correction of non-conformities and deficiencies; v Oversee vessel compliance activities; and v Track and verify that nonconformities and deficiencies were corrected; – Procedures for recordkeeping; and – Procedures for assigning personnel with requisite experience and expertise to carry out the elements of the survey. – The owner or managing operator is not required to survey the items as described in § 137. 220 as one event, but may survey items on a schedule over time, provided that the interval between successive surveys of any item does not exceed 1 year, unless otherwise prescribed. 12

Compliance Options - TSMS l Internal Survey Program (Drydock & Internal Structural Examinations) n Requirements for this program are: – A survey program that meets the requirements contained in § 137. 325; – Qualifications of the personnel authorized to carry out a survey program that are comparable to the requirements of a surveyor from a TPO as described in § 139. 130 of this subchapter; – Procedures for documenting and reporting non-conformities and deficiencies; – Procedures for reporting and correcting major non-conformities; – The identification of a responsible person in management who has the authority to stop all vessel operations pending corrections, to oversee vessel compliance activities, and to track and verify the corrections of nonconformities and deficiencies; and – Objective evidence that supports the completion of all elements of a vessel’s drydock and internal structural examinations. – The owner or managing operator must notify the TPO responsible for auditing the TSMS whenever activities related to credit drydocking or internal structural examinations are to be carried out prior to commencing the activities. – The interval between examinations of each item may not exceed the applicable interval described in § 137. 300. – The owner or managing operator must notify the cognizant OCMI of the zone within which activities related to credit drydocking or internal structural examinations are to be carried out prior to commencing the activities. 13

TPO oversight of “Internal” Survey Program l Your TPO should provide: n n n Verification of Internal Surveyor qualifications Verification of Internal Survey Program management through external TSMS audits Randomly attend surveys to confirm vessel condition and survey methods used are in accordance with TSMS Periodic visits to the company to ensure internal survey program complies with TSMS and regulations Review of internal survey and internal audit reports to ensure Sub M requirements are met 14

Certificates of Inspection l 136. 215 n n (a) A COI for a towing vessel is valid for 5 years from the date of issue. (b) For a towing vessel utilizing the TSMS option, the COI is invalid upon the expiration or revocation of the owner or managing operator TSMS certificate or the ISM Code Certificate. n (c) A COI may be suspended and withdrawn or revoked by the cognizant Officer in Charge, Marine Inspection at any time for noncompliance with the requirements of this subchapter. 15

Certificate of Inspection (COI) Application l Objective Evidence (examples): n n n n n l Dry dock exam Internal structure exam Class Certification Load Line Certification ISM Certification/Audits TSMS Certification/Audits Annual vessel surveys Current UTV Exam Internal Audit Reports Your TPO should assist with providing any of the above documents 16

TSMS Options l International Safety Management (ISM) System l AWO Responsible Carrier Program (ACP) l Company Specific Safety Management System (Compliant with Subchapter M 46 CFR Part 138) 17

Objectives of Safety Management System § Safety of personnel § Protection of environment § Pollution prevention § Prevention of damage to equipment § Regulatory compliance § Emergency preparedness § Continual improvement of work practices, especially safety aspects § Meet stakeholder expectations 18 | 46 CFR Subchapter M Overview – Part III

TSMS Roadmap To Compliance Implementation and Certification • Implement approved SMS • Complete internal audits • (company and minimum one vessel) • Complete company audit (first) • Issue DOC/TSMS Certificate • Complete vessel audit(s) Base Line • Gap Analysis • ISM/RCP/SMS complete • Sub M pending • Determine management system structure options 19 | Carline Companies Sustain Program/Drive Improvements • Annual Management Review • RCP/SMS Office Audit ( 2 x 5) • ISM Office Audit (Annual) Vessel Audit RCP/SMS (1 x 5 years) Vessel Audit ISM (2 x 5 yrs) • Policy and process changes (continual improvement) SMS Development & Approval • Update current manual • Submit for approval

ISM Code Compliance for Towing Vessels § Basic steps for compliance with ISM Code - Safety Management System (SMS) Review – SMS manual reviewed by ABS auditor either at client office or by submission to ABS office – Typically, SMS may be reviewed/approved within 1 day - Document of Compliance (DOC) Audit – Company implements SMS onboard vessels – Implementation period of at least 90 days – Company carries out internal audit of company office and onboard vessels – Company requests ABS to conduct Initial DOC audit – ABS issues Document of Compliance valid for 5 years 20 | 46 CFR Subchapter M Overview – Part III

ISM Code Compliance for Towing Vessels § Basic steps for compliance with ISM Code - Safety Management Certificate (SMC) Audit – Vessel Initial Audit: upon issuance of DOC, company requests vessels Initial ISM Audit – Copy of DOC to be available onboard – Internal audit report to be available onboard – Planned Maintenance System to be fully implemented onboard – ABS issues SMC to vessels valid for 5 years 21 | 46 CFR Subchapter M Overview – Part III

ISM Code Compliance for Towing Vessels § AWO Member certified under ISM Code - RCP Add. B. 6: A company certified under the International Safety Management (ISM) Code, to be eligible for AWO membership, must include in its Safety Management System all requirements unique to the RCP. This must be verified through the annual third-party Document of Compliance (DOC) audit. – A company wishing to use ISM compliance to meet AWO’s requirement that all members of the association must have a Safety Management System must send a letter to the AWO Safety Department stating that the company is operating in full compliance with all requirements of the ISM Code and certifying that its Safety Management System includes all requirements unique to the Responsible Carrier Program… – For companies participating in ISM whose entire fleet is not required to maintain Safety Management Certificates, 100 percent of those vessels without an ISM Safety Management Certificate must undergo an RCP vessel audit using the appropriate RCP vessel audit checklist at least once every five years. 22 | 46 CFR Subchapter M Overview – Part III

RCP/SMS Roadmap to Compliance q Contract/Service Agreement with TPO q Submit RCP or TSMS manual to TPO for table top review q Upon successful completion of RCP or TSMS manual review, complete the Initial Management (Company) Audit. q The RCP or TSMS must be implemented for a minimum of 90 days prior to the audit. q After successful completion of the Management Audit, complete RCP or TSMS audits on one (1) vessel of the company’s fleet (TSMS) or 10% of the fleet (RCP) within 12 months q Upon completion of the Management Audit and 10% of the fleet (RCP) or one vessel (TSMS), the Company may be issued a TSMS Certificate or RCP Letter of Compliance q q The Management Audit is to be carried out twice in every 5 year period with the Mid-Term Audit completed between the 27 th and 33 rd months. Vessels to complete one audit every 5 years 23

ABS Processes for TSMS Certification § RCP compliant company to obtain TSMS certification, process is similar to ISM certification which is a three stage process after Service Agreement or MSA. 1. Manual Review (Stage 1) desktop review to TSMS using Audit notes and TSMS job aid. (Manual is not stamped) TSMS Manual review letter issued after corrections/clarifications accepted. 2. Company Audit (Stage 2) on site (Requires 2 day notification to AWO) or 72 hour notification to USCG local OCMI. 3. Vessel Audits (Stage 3) on site. § TSMS Certificate is issued valid for 5 years minus 1 day 24 | 46 CFR Subchapter M Overview – Part III

RCP Audit Intervals* 10% of Fleet Start Year 1 100% of Fleet Year 2 Year 3 Year 4 Year 5 Months 27 -33 20 % fleet increment per year *Company office and vessel internal audits must be carried out annually. 25 | 46 CFR Subchapter M Overview – Part III

Common Manual Review Findings § Manuals make no reference to 46 CFR Sub M parts 136 -144 § Document control deficiencies – sections/revisions, who is responsible for document control § 72 hour notification to USCG OCMI for company audit § Internal auditor qualifications not addressed § Master’s responsibility and overriding authority § Navigation assessments; documenting hand over from Captain/Pilot to wheelman § Documenting onboard orientation § Towing vessel recordkeeping of towing gear 26 | Title of Presentation Goes Here

Common Manual Review Findings § Effective Corrective Action Procedures § Company’s electing “Internal Survey” Option have not addressed – survey scope, schedule, tracking, qualifications § Documenting selection criteria for TPO § Part 141 Lifesaving / Part 142 Fire Protection – Alternate means for complying with prescriptive requirements, equivalent arrangements provided they are documenting TSMS § Permits to Proceed § Excursion Permits § TPO Witnessing drills during external audit 27 | Title of Presentation Goes Here

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