Summary on Small Passenger Vessels

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Executive Summary

General

The Marine Regulatory Directorate of Transport Canada contracted MIL Systems Engineering (MIL Systems) to carry out technical investigations relating to the comparison of regulations and accident statistics for United States and Canadian passenger vessels, and the determination of regulatory philosophies behind these regulations.

The approach to the study involved the following tasks:

1. The determination of regulatory requirements of Canadian and United States regulations applicable to the construction and operations of small passenger vessels;
2. The comparison of the differences between the Canadian and United States requirements;
3. The review of Canadian and United States philosophies with respect to the development and content of the regulations for vessels operating in the domestic trade
4. The review of Canadian and United States accident statistics for the vessels under review;
5. The comparison of accident rates in the two countries;
6. The selection of representative passenger vessels for use as a basis for costing differences;
7. The estimation of the cost of disadvantage (if any) to the Canadian Industry; and
8. The provision of conclusions and recommendations based on the results of the study.

Conclusions

The conclusions developed as a result of carrying out this study are summarized as follows:

1. The impact of low tonnage measurements on updated passenger vessel regulations is now much less significant than previously, due largely to the revision of United States regulations and their use of length and number of passengers as a basis for regulation in lieu of Gross Register Tonnage ( GRT ). The impact of low tonnage on US vessels is no longer significant for acquisition costs, but remains significant for operational costs due to manning level requirements, maintaining the disadvantage to Canada in this area;
    
2. Major differences between the two countries' regulations for passenger vessels summarized as follows:
    
   Inspection
   Canada has a requirement for annual inspections as well as four or five year and drydock inspections; US has similar requirements for vessels not more 100 Tons (new regulations) but retains more frequent intermittent inspections during the year, as well as annual and drydock/haulout inspections for vessels more than 100 Tons.
    
   Structural Fire Protection
   Similar requirements for fire-rated bulkheads and decks. Canada requires fire detection and alarm system; US has no such requirement except for vessels carrying overnight passengers.
    
   Lifesaving Equipment
   Where Canada requires liferafts, US allows inflatable buoyant apparatus. US lifejackets are less costly than Canadian models, having a noticeable cost impact for large numbers required on passenger vessels.
    
   Fire Protection Equipment
   Sprinkler system required on Canadian passenger vessel No. 1, but not the US equivalent. Two fire pumps required on Canadian passenger vessels no. 2 & 3, US requires only one. Passenger vessel No. 4 requires CO₂ system, US vessel does not.
    
   Navigation Equipment
   Canadian passenger vessels No. 1, 2, and 3 require a radar and plotter, US requires neither on standard tonnage and radar only on "T-Boat" (as a result of recent regulatory changes). Canadian passenger vessel No. 1 requires gyro, US requires magnetic compass only.
    
   Manning
   Canada is at a disadvantage primarily due to the requirement to carry a Chief (Senior) Engineer as well as a Mate on the three larger Canadian vessels.
    
   Subdivision
   On the larger vessel Canada must meet certain load line requirements - the US standard vessel requires the same but the "T-boat" (see glossary) has no such requirements.
    
   The largest single difference is due to lifesaving equipment, followed by manning, structural fire protection, navigation equipment, and fire detection systems. It should be noted that manning costs have been assumed (see Table 2.3.18). It is recognized that such costs are independently negotiated between personnel and passenger vessel owners/operators and therefore, in reality, may differ significantly from the assumptions made by MIL Systems;
   
    
3. The largest difference between Canadian and US passenger vessel regulations for a given size vessel is no longer directly attributable to tonnage measurement of US vessels and the existence of "T-Boats"(vessels which would normally be over 100 Tons having a Gross Register Tonnage below 100), due primarily to revised passenger vessel regulations in the United States. Tonnage measurement and the existence of "T-Boats" however, still remains an impact on operational costs for manning, with estimated costs of disadvantage between $5,000 for the smallest vessel to $45,000 for the larger vessel (with overnight passengers) evaluated;
    
4. Major areas of differences between US and Canadian passenger vessel regulations are: structural fire protection, lifesaving equipment, and navigation equipment. Other regulatory differences were not found to be significant in terms of cost impact, with the exception of manning requirements, where there was a significant variation (see above). Acquisition cost impact estimates ranged from a $4,000 advantage to a $154,000 disadvantage to Canadian vessels. For the vessel with $154,000 (a US "T-Boat"), the three largest impacts were estimated at $25,000 for structural fire protection (fire detection and alarm systems), $88,000 for lifesaving equipment ( US use of inflatable buoyant apparatus versus Canadian requirements for liferafts), $18,000 for Navigation equipment, and $15,000 for subdivision and stability (Load Line requirements). For the same US vessel with a normal GRT over 100, these values would be revised to $30,000, $57,000, $33,000 and $0 for the same topics respectively. Other smaller impacts made-up the remainder of the overall cost disadvantage to Canadian vessels (see Table 2.3.28);
    
5. Larger passenger vessels had significantly higher acquisition cost disadvantages to Canadian vessels compared to smaller passenger boats. The two small passenger vessels would in general seem to have only minor costs of disadvantage over their US counterparts other than for manning, where cost of disadvantage to Canadian vessels was estimated at $4,000 to $7,800 / year for a 12 metre boat. Other requirements had cost impacts of some $5,500 disadvantage to Canada for Passenger Vessel No. 4, and a $4,300 advantage for Passenger Vessel No. 5.
    
6. Passenger vessel accident statistics varied considerably between United States and Canadian vessels. Accidents in the US normalized to Canadian accident rates ranged from as low as 6% of Canadian strikings for vessels 15< GRT ≤100 ( US Fleet size 3,873), to over nine times Canadian incidents of fire for vessels GRT >500 ( US Fleet size 129). US collisions, groundings, strikings, and incidents of fire had a general uptrend with increased GRT normalized to Canadian values (see Table 3.7). US vessels with a GRT ≤100 had 6%-87% of Canadian incidents with the exception of four times as many collisions and 1½ times more floodings in the US than Canada for vessels GRT <5. Surprisingly, vessels 5< GRT ≤100 exhibited the best safety record in the US , better than Canada's, considering that this range of tonnage includes "T-boats";
    
7. Although Canadian values for Other-Misc. incidents were unavailable at the time of writing, US statistics, which include disablings and material failures, exhibited a strong upward trend at the upper end of the GRT range. Vessels GRT ≤100 had one to three incidents per 1000 vessel fleet per year, whereas vessels 100< GRT ≤500 and GRT >500 had 77 and 360 respectively. The latter indicates that on average, in any given year, some 36% of vessels with a GRT >500 will incur an incident of material failure or disabling, and some 19% of vessels GRT >500 will have a reportable incident, including collision, grounding, etc.;
    
8. Differences in philosophies between Canada and the United States for regulatory development seem to be primarily restricted to the implementation of international regulations ( IMO ) to domestic fleets, where Canada uses this approach, the US develops most of its own requirements for vessels operating in US waters, although recent amendments to lifesaving regulations incorporate many IMO requirements, with waivers given depending on a vessel's operations and risk to passengers; and
    
9. The regulatory development process for Canada and the United States reflects similar intents for input into the process from all interested parties, although the US system would seem to reflect a more open system of regulation, offering additional explanations and detailed rationale for new regulations and changes to existing ones.

Recommendations

1. Accident statistics comparisons for passenger vessels between the United States and Canada show considerable variations of accident rates, with the United States having generally fewer incidents for vessels GRT ≤100, and considerably more for larger vessels. Although reasons for these differences are difficult to identify without further study, it suggests that the approach taken by the United States for rulemaking, with domestic requirements developed by the United States Coast Guard ( USCG ), in lieu of basing regulations on IMO initiatives, is equally effective in limiting loss of life and damage to property for vessels GRT ≤100 (Fleet size of 3,873 and 71% of passenger vessels in US , including "T-Boats"). To this end, it may be beneficial to review the current practice of Transport Canada, Marine Regulatory Directorate of applying IMO requirements to vessels on domestic trade. It should be noted however, that these statistics do not reflect newly revised regulations in the United States. Under these new regulations however, the US still provides exemptions for vessels not on international voyages and not subject to IMO requirements. In light of these issues, Canadian regulators might reconsider their approach to the application of IMO requirements to the domestic fleet;
    
2. As the large increase in accidents for US vessels over 100 Tons GRT would seem unusual, further analysis of these statistics and their underlying causes might be beneficial in better understanding regulatory impacts vessel safety.
    
3. During the process of reviewing United States regulations it was noted that the U.S. system of issuing, tracking, and revising regulations seemed somewhat more open. Proposed rulings, and rulemaking revisions were clearly explained in terms of rationale and all comments were addressed and published, including the U.S. Coast Guard's acceptance or rejection of proposed changes from the public sector, as well as background of the process to-date. This approach made it extremely easy to pick-up a document for a U.S. rulemaking and know the background for the change, the rationale for it, and the actual regulations proposed. As Transport Canada, Marine Regulatory Directorate, is presently revising its approach to the design of regulations, it might be useful to consider an approach similar to that used in the United States.
    
4. Although there remains a disparity in tonnage measurement between United States and Canadian systems, allowing the existence of vessels with a Gross Register Tonnage ( GRT ) much lower than that which would normally represent a given size vessel for United States Flag vessels (T-Boats), the significance of this disparity will become less of an issue in the future. Although new U.S. regulations will allow existing passenger vessels with a GRT <100 to maintain the same equipment and meet the same requirements as when they were built irrespective of size or number of passengers carried, new U.S. regulations will impose stricter requirements on new vessels based on size and number of passengers in lie of tonnage, thereby eliminating the advantage of meeting more relaxed requirements for vessels with a GRT less than 100. To this end, it is recommended that Canada not change their tonnage measurement system to a that which would allow tonnages outside those providing a good representation of vessel size. As existing U.S. vessels retire and new ones are built, the disparity between Canadian and U.S. vessels due to tonnage

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