Procedure - Exemption from the Delegated Statutory Inspection Program

Transport Publication - TP 13585 E

Details:
Marine Safety Management System - Procedures

Number:
TP 13585 E (Online Manual)

1 Process Flowchart

2 Purpose

  1. 2.1 The purpose of this procedure is to specify under what circumstances Transport Canada (TC) exempts vessels of 24 metres in length and above from the required participation in the Delegated Statutory Inspection Program (DSIP).
  2. 2.2 For exempted vessels, TC will continue to offer those services specified in 36.1(1) of the Canada Shipping Act, 2001 (CSA 2001).

3 Authority

  1. 3.1 Section 16 of the CSA 2001 provides the authority to the Minister of Transport (Minister) to specify the form and manner in which an application for a Canadian Maritime Document (CMD) must be made.
  2. 3.2 Paragraph 16(2)(c) of the CSA 2001 provides the authority to the Minister to require that the vessel or its machinery or equipment undergo any inspections that the Minister considers necessary to establish that the requirements for the issuance of the CMD have been met.
  3. 3.3 This procedure comes under the overall administrative authority of the Director General, Marine Safety and Security.

4 Background

  1. 4.1 As part of federal Budget 2012, TC is implementing an alternative service delivery (ASD) initiative that is intended to expand the transfer of certification services from TC to classification societies (i.e. Recognized Organizations (ROs)) that are authorized to act on behalf of the Minister. Under this initiative, vessels of 24 metres and above will be directed to one of these ROs to obtain their CMDs and any of the services specified in subsection 36.1(1) of the CSA 2001.
  2. 4.2 The policy for the ASD initiative, which is implemented through DSIP, is set out in Tier I – Policy – Certification of Vessels of 24 Metres in Length and Above. Once subject to this policy, vessels will be enrolled in the DSIP. However, TC recognizes that not all vessels may be able to obtain services from an RO. Consequently, this policy sets out conditions under which TC will continue to offer those services specified in 36.1(1) of the CSA 2001 to vessels of 24 metres in length and above.
  3. 4.3 The Marine Safety and Security Executive committee has approved this procedure for general application.

5 Scope

  1. 5.1 This procedure applies to TC Marine Safety and Security (TCMSS) employees that are responsible for determining when TC will offer those services specified in 36.1(1) of the CSA 2001 to vessels of 24 metres in length and above.
  2. 5.2 This procedure does not apply to the issuance of CMDs to vessels under 24 metres in length, as per the formula in the Vessel Registration and Tonnage Regulations and the International Convention on Tonnage Measurement of Ships, 1969. This procedure does not apply to existing fishing vessels under 24.4 metres in length.

6 Responsibility

  1. 6.1 The Executive Director, Domestic Vessel Regulatory Oversight and Boating Safety, is accountable for the development, implementation, maintenance, and continuous improvement of the procedure.

    For further information, please contact:
    Manager, Safety Management Systems and Authorization
    330 Sparks Street
    Ottawa (Ontario) K1A 0N8
    Email: dsip-pdio@tc.gc.ca

7 Procedure

  1. 7.1 TCMSS receives an application (Form 85-0494) and the supporting documentation from the vessel’s Authorized Representative (AR) requesting an exemption from the required participation in the DSIP.
  2. 7.2 The below timelines are related to the application for exemption:
    1. 7.2.1 the request for exemption cannot be presented earlier than six (6) months from the planned dry-docking date of the vessels.
    2. 7.2.2 the refusal from the ROs is valid for a maximum of six (6) months after issuance to AR.
  3. 7.3 TCMSS may consider an exemption from DSIP with supporting documentation under one (1) of the following four (4) circumstances:
    1. a) Financial Hardship:

      Despite taking all reasonable steps to comply with the Tier I – Policy – Certification of Vessels of 24 Metres in Length and Above, the burden of compliance costs would create a serious economic hardship for the company.

      The AR must submit at least one quote received from the ROs, as well as Reviewed financial statementsFootnote 1 and any additional documentation that may be requested to support the financial statement or to describe the operation.

      The factors listed below will be taken into account when determining serious economic hardship:

      • Compliance with the Policy would require an unreasonable change in the business activities of the company as to compromise the economic or commercial viability of the trade or business in which the vessel operates or the service it provides; or
      • TCMSS finds it reasonable to expect that the trade, business or service provided will only continue if the vessel continues to obtain its CMDs and services from TCMSS.
    2. b) Financial Hardship Impact on services provided to the public:

      The burden of compliance costs would create undue economic hardship on the rural areasFootnote 2 and will have serious impacts on the provisions of the servicesFootnote 3 provided directly to the public of that area. The AR must submit at least one quote received from the ROs, as well as Reviewed financial statementsFootnote 1 and any additional documentation that may be requested to support the financial statement or to describe the operation.

      The factors listed below will be taken into account when determining Financial Hardship Impact on Public Services:

      • Compliance with the Policy would require an unreasonable change in the mandate or operations which may seriously compromise the provision of the services provided directly to the public.
      • TCMSS finds it reasonable to expect that the operation of the organization and the services provided by the same organization to the public, may have to be reduced or discontinued, unless TCMSS issues the CMDs and provides inspection services.
    3. c) Inability to receive services from ROs:

      All ROs except for one (1) have clearly indicated their refusal to enter into an agreement to issue CMDs and/or conduct the inspections mentioned in 4.1 for the vessel in question. All refusal emails/letters indicating refusal of service have to be provided to TCMSS; or

    4. d) Remote locations

      This applies to vessels operating solely within the following Areas of Operations:

      • Alberta, Manitoba, Saskatchewan, Yukon, Northwest Territories and Nunavut; or
      • North of 52 degrees for: Ontario, Quebec and Newfoundland and Labrador north, including coast of James Bay; or
      • North of 52 degrees in British Columbia and more than 150km from Prince Rupert.

      Areas of Operations: vessel operates only in the areas identified, and does not have a port of call or dry docking location outside of the identified locations.

  4. 7.4 Based on the documentation provided and any input from the local TC office, TCMSS determines whether it will continue to issue CMDs and conduct the inspections mentioned in 4.1.
  5. 7.5 TCMSS writes a record of decision regarding the enrolment into DSIP or the exemption from DSIP.
  6. 7.6 Once the record of decision is approved, TCMSS communicates the decision to the AR. Depending on the situation, this decision will be valid until the next scheduled dry-dock inspection or change of AR, whichever comes first.
  7. 7.7 The service standard is 30 business days between receiving a complete application and sending the record of decision to the AR.

8 Related Documents

  1. 8.1 Tier I – Policy – Certification of Vessels of 24 Metres in Length and Above (RDIMS 8388535)
  2. 8.2 Tier III – Work Instructions – Review of Applications for Certification by Transport of Vessels of 24 Metres in Length and Above (RDIMS 9069041)
  3. 8.3 Application form (85-0494)

9 Definitions

  1. 9.1 Authorized Representative is the person meeting the requirements of section 14 of the CSA 2001.
  2. 9.2 Canadian Maritime Document has the same meaning as in s. 2 of the CSA 2001.
  3. 9.3 Certification services include services related to CMDs and other approvals and certificates; approval of plans associated with the construction or modification of a vessel; conduct and witnessing of tests; and conducting any inspections necessary to establish that all the requirements have been met for the issuance of the CMD, including any necessary first (initial) inspections, periodic (periodical) inspections, and intermediate inspections.
  4. 9.4 Existing vessel is a vessel that had a valid CMD prior to December 31, 2013, and that was not subsequently removed from the Canadian registry. Existing vessels also include new vessels under planned construction or other vessels undergoing major modifications that have submitted their vessel plans to TC for approval before the coming into force of this Policy.
  5. 9.5 Length is calculated in accordance with the formula in the Vessel Registration and Tonnage Regulations and the International Convention on Tonnage Measurement of Ships, 1969. Existing fishing vessels will apply the 24.4m cut-off that currently exists between small and large fishing vessels.
  6. 9.6 New vessel is a vessel that was registered in Canada on or after January 1, 2014. This includes vessels that had a valid CMD on December 31, 2013, that were subsequently removed from the Canadian registry and then registered again in Canada on or after January 1, 2014.
  7. 9.7 Recognized Organization is a classification society that has entered into an agreement with the Minister to perform certain functions on his or her behalf, such as issuing CMDs or type approval of equipment.

10 Date of Application

  1. 10.1 This procedure will come into force on May 1, 2016.

11 RDIMS Reference

  1. 11.1 The English version of this document is saved in RDIMS under reference number 11232419.
  2. 11.2 La version française du présent document est dans le SGDDI et porte le numéro de référence 11876921.
  3. 11.3 This is the second approved and finalized revision of the English version of this document.

12 Keywords

  • Vessel certificates
  • Inspection
  • Certification
  • Authorized Representative
  • Canadian maritime documents
  • Recognized Organization
  • Classification societies
  • 24 metres
  • 150 GT
  • Alternative Service Delivery (ASD) plan
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