The Obligations of Inland Marine Operators for Electronic Data

The Obligations of Inland Marine Operators for Electronic Data

Written by Ned Fasullo on Aug 25, 2017

For many inland marine operators, the importance of securing and saving digital data can seem like an insurmountable task. In some cases, it can seem insurmountable for operators to effectively maintain connectivity from their fleet to shore and port. What is fact is that the time is now for all inland marine operators to take this issue very seriously and to get a plan in place to protect themselves.

Technology drives all of our work every day. It enables global commerce at international companies down to the smallest mom-and-pop general store. Just because your business floats on an inland waterway doesn’t mean you shouldn’t have the same access to and implementation of technology and communications that everyone else does. For the purpose of this article, there are a few areas that must be considered critical to how inland marine operators do their business and adhere to regulatory requirements at the local, state and federal level. These areas include:

  • Ship Network & Systems & Users. Network and Communications systems are critical to this effort. End users should be able to connect to the vessel’s network, communicate on the vessel and from vessel to shore unencumbered to do their jobs. This foundation creates the platform that you can build your plan on for backup and storage.
  • Backup & Storage of Systems & User Data. There is no reason in this day and age for any inland marine operator to backup or store any critical data on their vessel, at least not for any length of time s to cause distress if the data cannot be retrieved quickly. Inland operators need to embrace the use of the Cloud in order to wirelessly connect to data centers as to have a place for the data to land and that is compliant for the concerns of the operator.
  • Security of Ship Network, Systems & Data. Once your network is being utilized, end user and network security must come into play. Enabling a secure environment means that there is less chance of data corruption and data loss over the long term, and certainly less chance of data being accessed and manipulated by rogue employees.
  • Connectivity. Without solid high-speed connectivity from the vessel to the shore and back, the first three points become fairly moot. Inland operators must be up-to-date on the communications options there are in the marketplace such as VSAT, LTE, SD-WAN, etc.

Audits

The IRS has a detailed overview of audit issues for inland marine operators which can be found here. Other than that aspect, there are many other circumstances that may drive the need for an audit, including (but not limited to) health and safety issues/claims, vessel operations/repairs, etc. With the majority of record keeping being paper-based, operators are constantly challenged with how and when they store this data, and how they access it later to accommodate requests.

Investigation

In terms of investigation, which usually occurs after audit and before litigation, the inland operator must provide only certain data, but also must be able to capture any of the investigator's efforts in a digital format. This digital data must be stored and kept for up to 3-5 years minimum.

Litigation

We exist and operate in a litigious society. We are very quick to engage a lawyer to manage issues beyond our control or scope. Anytime that litigation becomes a vehicle for solving the problem, E-Discovery regulations come into play. While there are differences at the local, state and federal levels, one thing is common among all three-being able to provide discoverable paperwork in a digital format (i.e. .PDF). The management of this electronic data and life-cycle therein is limited to the regulatory statutes in place for the circumstance, i.e. is it a local issue, a state issue, or a federal issue, is it a tax issue or is it an HR issue? Whatever happens, the inland operator must be able to provide their documentation in a litigation circumstance as electronic data.

Sub-chapter M and its implications

The following was excerpted from an article in WorkBoat Magazine. The Subchapter M Final Rule is a whopping 800 pages (including a 536-page preamble). The preamble is the Coast Guard’s response to all submissions from the 2011 public comment period and its rationale for additions, deletions, and enhancements to the final rule (FR). The actual language of the FR — which takes effect on July 20 — begins on page 537.

Below are some highlights for inland towing operators to consider as they begin the transition to Subchapter M compliance.

  • User Fees. The Coast Guard will be issuing an additional rulemaking for Subchapter M user fees, but until then, $1,030 will be the user fee rate.
  • Manning. A few technical changes were made to align towing license requirements with manning requirements. The FR gives the Officer in Charge Marine Inspections (OCMI) broad discretion in working with individual towing vessel operators to develop Certificate of Inspection (COI) manning requirements specific to the vessel’s route, trade, construction and arrangement.
  • Certification/Definitions/Applicability.  Mostly minor technical adjustments, but no dazzling departures from the Notice of Proposed Rulemaking (NPRM).
  • Vessel Compliance. Four points of note:
    • The USCG Annual Boarding & Third Party Organization (TPO) Solution is retained as a compliance option.
    • The use of a properly credentialed licensed mariner/surveyor acting on behalf of the operator in lieu of an external surveyor is authorized.
    • All Subchapter M vessels must be in full compliance with the FR on or before the issuance of the vessel’s COI or July 20, 2018, whichever date is earlier.
    • All towing operators must have a fully implemented health and safety plan by July 20, 2019.
  • Towing Safety Management System (TSMS).  USCG has defined the TPO solution process. The TPO certifies the operator’s Towing Safety Management System and issues a TSMS certificate. Thereafter, following a successful vessel TSMS audit, the TPO issues the TSMS certificate to the vessel and transmits the audit report to USCG. The operator schedules a USCG boarding for COI issuance.
  • Third-Party Organizations. USCG-approved class societies are authorized to perform Subchapter M surveys and audits commencing July 20, 2016. Non-class TPOs must be vetted and approved by the USCG. Auditors and surveyors may be non-exclusive.
  • Operations. Four critical elements are addressed in this section:
    • All vessels electing the USCG Annual solution must have a Towing Vessel Record (TVR) onboard.
    • All vessels electing the TPO solution may have a TVR or another equivalent solution and must be stated as such in the TSMS.
    • The statutory requirements for a TVR are spelled out in detail including all the required recordkeeping entries.
    • USCG-defined Criminal Penalties & Fines for Subchapter M violations are consistent with other subchapters.
  • Lifesaving. Consistent with the NPRM.
  • Fire Protection. Expands on standards, recordkeeping, and inspections.
  • Machinery & Electrical. No longer a requirement for redundant propulsion or wheelhouse alter system. Deferred electrical requirement also eliminated from the rule.
  • Construction and Arrangement. A key drydocking requirement which stipulates that a towing vessel must be on the blocks every two-and-a-half or five years depending on the vessel’s annual saltwater exposure, also covered in Part 140.
  • Crew Endurance Management System (CEMS). Consistent with NVIC 02-08.

Are You Prepared?

Envoc stands ready with cutting edge talent and innovative thinking to plan and implement a custom software application that can help your organization manage the necessary actions and data compliance for this new regulation. The key to success in this area of operations is input and monitoring of your data from anywhere anytime and ubiquitous access to all of the necessary data whenever needed.

For more information on ways that Envoc can help your organization, please contact us at sales@envoc.com today to learn more.