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Year Two COI Considerations and Requirements

• TVIBs TPO customers lead the pack for meeting the 25% requirement for obtaining COIs in year one. 

• Now is not the time slow up as the Coast Guard is squarely focused on the year two deliverable of 50% of an owner/managing operator’s fleet along with all of the one vessel owner/managing operators that must have their COI by July 20, 2020.

New Construction Vessel COI Requirements

• A new towing is defined in §136.110 “means a towing vessel, subject to inspection under this subchapter, that: (1) Had its keel laid or was at a similar stage of construction on or after July 20, 2017; or (2) Underwent a major conversion that was initiated on or after July 20, 2017.”
• §136.202(c) “A new towing vessel must obtain a COI before it enters into service.”
• TSMS option vessels – §138.315(b)(2) “(2) An external audit must be conducted no later than 6 months after the issuance of the initial COI for vessels subject to the owner or managing operator’s TSMS that have been owned or operated for fewer than 6 months prior to receiving the initial COI.”
• Owner/managing operators that are engaged in new construction should keep these items in mind.

If your company has obtained COIs since the implementation of Subchapter M then you have two issues to consider upon the one-year anniversary mark:

• Vessel Inspection Fees; and
• Annual Surveys Deadlines for TSMS Options Vessels

Vessel Inspection Fees:

Coast Guard Vessel Inspection Fees are covered in 46 CFR 2.10 — Table 2.10-101—Annual Vessel Inspection Fees for U.S. and Foreign Vessels Requiring a Certificate of Inspection. 

• These fees begin on the first anniversary of the issuance of the COI;
• They will be due annually thereafter;
• These fees apply to both Coast Guard option vessels and TSMS option vessels; and
• AWO and others have been working with the Coast Guard in an effort address the issue to reduce the fees for TSMS option vessels. This effort is ongoing.

Annual Survey Deadlines for TSMS Option Vessels

External Survey Program

• 46 CFR Subchapter M 137.205(a)(3) Ensure the survey is conducted within 3 months of the anniversary date of the COI.
• This allows for the annual survey to occur up to 90-days before or after the anniversary date of the COI.

Internal Survey Program

• 46 CFR Subchapter M 137.210(b) (b) 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.
• The regulations are silent on the specific deadlines for companies that complete the survey as a single annual event under the internal survey program option. 
• The premise of the internal survey program is that it must provide for equivalent practices as would be found under the external survey program.
• 12/31/2019 UPDATE – removed language related to “unless otherwise prescribed” as it relates to TVIBs interpretation of timing for annual surveys performed under an internal survey program, see TVIBs blog post of 12/31/2019 related to same.