10 Jul 2018
Peter Rowand
Marketing and Business Development

Subchapter M Compliance

We’re just weeks away from Subchapter M coming into effect. Starting July 20th, all tugboats and towboats in the US above 26 feet, must comply with the regulation. As enforcement approaches, many operators are focused on receiving their first Certificates of Inspection (COI), especially as USCG has mandated a phased compliance effort, requiring that 25% of a fleet must obtain its COI in the first year of enforcement, increasing 25% of their fleet until all vessels are required to have their COI by July 19, 2022.

However, there is a misconception in the industry that you only need 25% of your vessels in compliance with Subchapter M by July 20th, 2018. According to Rob Keister, Manager of Compliance and Special Projects at leading TPO Sabine Surveyors, that’s just not the case.
Subchapter M Compliance
“Even though all vessels do not have to be inspected at once, all vessels subject to Sub M are required to meet Subchapter M standard as of July 20th this year.” How would anyone know? Well, they wouldn’t, unless someone gets hurt on the vessel and it goes to litigation, or there’s an accident on the vessel and the Coast Guard goes onboard and realizes the vessel is not in compliance. People think there’s a fine, or your boat can’t run if you’re not in compliance, but it could get a lot worse than that. Your insurance is void if you’re not in compliance, which could lead to serious financial implications.”

There are two options to becoming compliant with Subchapter M. The first is the Coast Guard option and the second involves writing a Towing Safety Management System (TSMS) and hiring a Third Party Organization (TPO), such as Sabine Surveyors, to conduct audits and surveys of your company. “Initially, when the regulation came into effect, it was widely anticipated that about 75% of companies would choose the TPO option and 25% would go with the Coast Guard option. However, that was just not the case. About half of the US fleet have gone to a TPO and half are going with the Coast Guard option.”

How the TPO option works

Management Audit

After a company writes their TSMS, they hire a TPO to do a management audit to see if the company is in fact doing what they say they’re doing. After the company passes the management audit, they get a TSMS certificate which is good for 5 years.

A management audit can be a very time consuming process. According to Keister, having an electronic system in place to help manage compliance can cut down the time both in preparing and auditing. “We can do a management audit for a company that is using an electronic system in about 6 hours. For companies that are using email and excel to manage their operations, this takes us usually 2 days or 12-15 hours. Having a system in place, like Helm CONNECT, cuts the time down by roughly half. It’s a huge time saver.”

Vessel Audit

Once the company has their TSMS certificate, then the TPO will starts auditing the company’s boats. In the first year, they’ll audit 25% of the fleet, and do an additional 25% every year until all boats obtain their COI. After a vessel audit, the boat gets a COI (certificate of inspection) which is good for 5 years.

On the Vessel: What’s the difference between a survey and an audit?Subchapter M

“A survey is an inspection of the physical condition of a vessel and the equipment on the vessel. You don’t need a crew on board to do this part. An audit is where the human factors come into play. This is paperwork. 90% of this is done with the captain and a computer where we ask questions of how they would react to a certain situation. What does your policy say about x? The crew is also asked questions about their safety management system to ensure they know what they need to know,” says Rob.

A vessel audit needs to be done every 5 years and a vessel survey needs to be done every year.

Embrace TechnologyAccording to Rob, companies that push liquid are much further along with the regulation preparations than those that don’t. There’s a large knowledge gap between the two types of companies.

“The smaller companies are having a harder time preparing for the new regulations. A lot of these companies have been using email and excel sheets to operate and with the new requirements, it’s not easy to show an auditor there are no gaps with this sort of system in place. What we’ve seen is a company’s willingness to embrace technology is a huge factor in their success with becoming compliant.”

If you need a software system to help you stay compliant with Subchapter M regulations, contact us today to learn more about Helm CONNECT Compliance!