Formerly Dyer Ellis & Joseph www.blankrome.com New Maritime Developments Update Coast Guard Issues Six Final Rules Implementing Maritime Security Requirements November 2003 No. 20 New Development The Coast Guard has extended the The Coast Guard published six final rules on October 22, 2003, promulgating new maritime security requirements mandated by the Maritime Transportation Security Act of 2002 (MTSA). The new rules are effective on November 21, 2003, except for the vessel security rule which is effective on November 19, 2003. Overview These rules, available at 68 Fed. Reg. 60448 (October 22, 2003), replace a series of interim rules published on July 1, 2003. See 68 Fed. Reg. 39240 (July 1, 2003). In July 2003, Blank Rome published an analysis of the interim rules (see New Maritime Developments Advisories Numbers 8-13). These Advisories are available online at http://www.blankrome.com/publications/ maritime/archive.asp The final rules implement several modifications to the requirements contained in the interim rules. The purpose of this Advisory is to provide an overview of the significant changes contained in the final rules. For a complete understanding of the Coast Guard's new security requirements, our previous Advisories on the interim security rules should be reviewed together with this Advisory. The Coast Guard has published a consolidated regulatory text depicting the changes in bold at http://www.uscg.mil/hq/g-m/mtsa.shtml. The Coast Guard divided the final rules, like the interim rules, into the following six parts: Implementation of National Maritime Security Initiatives, Area Maritime Security, Vessel Security, Facility Security, Outer Continental Shelf Facility Security, and Automatic Identification System (AIS) carriage requirements. The organizational structure of this Advisory tracks these six parts. Analysis I. Implementation of National Maritime Security Initiatives (68 Fed. Reg. 60448 - to be codified at 33 CFR pts. 101 and 102) A. New Definitions & Clarifications to Existing Definitions The final rule includes the following new definitions: 1. Breach of security means an incident that has not resulted in a transportation security incident, in which security measures have been circumvented, eluded or violated. 2. Cargo vessel means a vessel that carries, or intends to carry, cargo as defined in 33 C.F.R. 101.105. 3. Dangerous goods and/or hazardous substances means cargoes regulated by 33 C.F.R. parts 126, 127 or 154. 4. Dangerous substances or devices means any material, substance, or item that reasonably has the potential to cause a transportation security incident. 5. General shipyard facility means a facility as defined in the Maritime Administration's vessel financing assistance regulations. 6. Public access facility means a facility used by the public primarily for purposes such as recreation, entertainment, retail, or tourism, and not for receiving vessels subject to part 104, that has minimal infrastructure for servicing vessels subject to part 104, and that receives only vessels not subject to part 104 or passenger vessels (except ferries certified to carry vehicles, cruise ships, or passenger vessels subject to SOLAS Chapter XI). Minimal infrastructure includes bollards, docks, and ticket booths, but does not include permanent structures that contain passenger waiting areas or concessions. In addition to adding the foregoing definitions, the Coast Guard amended and otherwise clarified the definitions of: 2003, BLANK ROME LLP. The purpose of the New Maritime Developments Update is to identify select developments that may be of interest to readers. The information contained herein is abridged and summarized from various sources, the accuracy and completeness of which cannot be assured. The Supplement should not be construed as legal advice or opinion, and is not a substitute for the advice of counsel.
1. Cargo to state that dredge spoils are not considered cargo. 2. Certain dangerous cargo to ensure that the security rules only use one definition (the interim rule used more than one definition). 3. Passenger vessel to clarify that when a vessel is on an international voyage carrying more than 12 passengers it is a passenger vessel if at least one passenger is a passenger for hire. 4. Dangerous substances or devices to mean any material, substance, or item, that reasonably has the potential to cause a transportation security incident. The Coast Guard believes that alcoholic beverages and drugs would not be considered dangerous substances or devices under the revised definition. 5. International voyage to clarify that vessels on the Great Lakes and St. Lawrence Seaway, even if exempt from SOLAS, are required to comply with these regulations. 6. Owner or operator to clarify when operational control of unmanned vessels passes between vessels and facilities. 7. Unaccompanied baggage to include baggage to be laden onboard a vessel when there is not an accompanying passenger or crewmember. 8. Waters subject to the jurisdiction of the United States to cross reference the Coast Guard's existing regulatory definitions related to marine jurisdictional terms to provide for uniformity. B. Exemption from Facility Security Requirements The final rule exempts general shipyard facilities from the facility security requirements of part 105 unless those facilities are subject to existing safety regulations for waterfront facilities. Also exempted are facilities that receive vessels certificated to carry more than 150 passengers if those vessels neither carry passengers while at such facilities, nor embark or disembark them from such facilities. C. Alternative Security Programs The Coast Guard has broadened the applicability of the Alternative Security Program (ASP) with regard to certain vessels and facilities Under the final rule, owners and operators required to have vessel security plans under part 104 may use an ASP, except for vessels subject to SOLAS Chapter XI. Previously, this exclusion applied to all vessels that engage on international voyages. In addition, because the Area Maritime Security Plan (Area Plan) will be the approved port security plan as described under the new SOLAS security regulation, facilities that serve vessels subject to SOLAS Chapter XI now have the option of using an approved ASP. Vessels and facilities (including OCS facilities) using an ASP must retain onboard the vessel or keep at the facility a security assessment report that is specific to the vessel or facility. This report, along with any information related to the implementation of an approved ASP, must be made available to the Coast Guard upon request. The final rule contains new procedures for amending an ASP. Approved ASPs are now valid for five years. The final rule approved the following ASPs for use by vessel or facility owners and operators: American Gaming Association ASP, dated September 11, 2003; American Waterways Operators ASP for Tugboats, Towboats and Barges, dated September 24, 2003; and Passenger Vessel Association Industry Standards for Security of Passenger Vessels and Small Passenger Vessels, dated September 17, 2003. D. MARSEC Levels The Coast Guard has modified its notification procedures for MAR- SEC Level changes by providing for electronic notification when possible. This procedure replaces notification by Maritime Security Directives. The final rule also permits owners and operators to designate the master of the vessel or another appropriate person to be responsible for reporting MARSEC Level attainment. Under the interim rule, the owner or the operator was required to notify the Coast Guard when it attained MAR- SEC Levels. Owners and operators, however, must ensure that the confirmation was sent. Finally, the Coast Guard announced its intention to update NVIC 9-02 (Guidelines for Port Security Committees, and Port Security Plans Required for U.S. Ports) to include guidance for communicating changes in MARSEC Levels to vessels and facilities bound for or operating in U.S. ports and internationally. II. Area Maritime Security (68 Fed. Reg. 60472 - to be codified at 33 CFR pt. 103) A. Area Maritime Security Committee The final rule provides that the Area Plan should address the responsibilities of Federal, State, Indian Tribal, and local government agencies and law enforcement entities with jurisdiction over port security related matters. It also adds labor to the list of areas from which Area Maritime Security Committee (Committee) members should be selected, and clarifies the requirements as to BLANK ROME LLP 2
Committee composition, providing that while seven members of the Committee must have at least five years of experience related to maritime or port security operations, the Committee may be composed of more than seven members. B. Area Maritime Security Plan To clarify the applicability of part 105 to facilities that have minimal infrastructure but are capable of receiving passengers, the final rule contains a definition for a public access facility. Under the final rule, public access facilities are exempted from part 105, subject to COTP approval. The final rule adds public access facilities to the list of elements that must be addressed within the Area Plan. To allow certain non-sensitive security information portions of the Area Plan to be widely distributed to maximize its communication and coordination with port stakeholders, the final rule provides that the entire Area Plan is not necessarily sensitive security information, and that only those portions of the Area Plan that contain sensitive security information must be marked as such. Under the final rule, as in the interim rule, the Captain of the Port (COTP) must test the effectiveness of the Area Plan once every calendar year with no more then 18 months between exercises. However, the final rule provides an option to obtain credit for an exercise (1) through other government or private exercises provided all components of the Area Plan are tested, (2) an actual increase in a MARSEC Level, or (3) implementation of enhanced security measures during periods of critical port operations or special maritime events. III. Vessel Security (68 Fed. Reg. 60483 - to be codified at 33 CFR pt. 104) A. Applicability Changes incorporated in the final rule with regard to applicability are as follows: 1. Foreign-flag cargo vessels greater than 100 gross tons (final rule). Foreign commercial vessels greater than 100 gross tons not subject to SOLAS (interim rule). 2. Self-propelled U.S.-flag cargo vessels greater than 100 gross register tons subject to 46 C.F.R. subchapter I (final rule). U.S.- flag commercial vessels greater than 100 gross register tons subject to 46 CFR subchapter I (interim rule). 3. Passenger vessels certified to carry more than 150 passengers (final rule). Passenger vessels subject to 46 CFR subchapter K (interim rule). 4. Other passenger vessels carrying more than 12 passengers, including at least one passengerfor-hire, that is engaged on an international voyage (final rule). No requirement for carrying at least one passengerfor-hire (interim rule). 5. Towing vessels greater than 8 meters in length engaged in towing a barge subject to this rule, except a towing vessel that (i) temporarily assists another vessel engaged in towing a barge or barges subject to this rule; (ii) shifts a barge or barges subject to this rule at a facility or within a fleeting facility; (iii) assists sections of a tow through a lock; or (iv) provides emergency assistance (final rule). The interim rule contained no exceptions to this provision. Finally, a vessel is not subject to this part of the rule while the vessel is laid up, dismantled, or otherwise out of commission. B. Compliance Vessel owners or operators must ensure their vessels are operating in compliance with this part by July 1, 2004, rather than the original date of June 30, 2004. In addition, the deadline for submission of Vessel Security Plans (VSP) has been changed from December 29, 2003, to December 31, 2003. C. Foreign-Flag Vessels Foreign-flag vessels not subject to SOLAS Chapter XI may now comply with this part through an ASP or a bilateral arrangement approved by the Coast Guard. If not complying with an approved ASP or bilateral arrangement, then the vessel must submit a VSP. Vessels that are subject to SOLAS may not use an ASP. For a foreign-flag vessel subject to SOLAS Chapter XI to be in compliance with this part, it must possess a valid International Ship Security Certificate (ISSC) that certifies that the certifications required by part A, Section 19.1 of the International Ship and Port Facility Security (ISPS) Code have been completed. This includes ensuring that the vessel meets the applicable requirements of SOLAS Chapter XI-2 and the ISPS Code, part A. As stated in Section 9.4 of the ISPS Code, part A requires that, in order for the ISSC to be issued, the provisions of part B of the ISPS Code need to be taken into account. This documentation must be onboard at all times. D. Noncompliance The noncompliance portion of the final rule clarifies that if a vessel must temporarily deviate from the requirements of the rule, the vessel owner or operator must notify the cognizant COTP, and either suspend operations or request and receive permission from the COTP to continue operating. BLANK ROME LLP 3
E. Security Officers The Coast Guard has clarified in the final rule that a Company Security Officer may also perform the duties of a Vessel Security Officer (VSO). In addition, a Master may serve as a VSO on manned vessels. For unmanned vessels, the requirement remains the same (that the same person may serve as the VSO for multiple vessels), but the Coast Guard now requires that that VSO be an employee of the company. F. Drills and Exercises A drill or exercise required by the rule may be satisfied with the implementation of security measures required by the VSP as the result of an increase in the MARSEC Level, provided the vessel reports attainment to the cognizant COTP. Vessels not subject to SOLAS may now conduct drills within one week from that date when the percentage of vessel personnel with no prior participation in a vessel security drill (on that vessel or on a company-owned vessel of similar design) exceeds 25 per cent. G. MARSEC Level Coordination and Implementation MARSEC-related provisions in the interim rule were limited to facility/vessel interface activities. The final rule includes interface activities involving outer continental shelf facilities. H. Declarations of Security The requirements relating to the implementation of Declarations of Security (DOS) have been slightly modified. Before a vessel may engage in vessel-to-vessel activities, Masters, VSOs, or their designees must coordinate and agree upon security needs to be included in a DOS. At the point of vessel-to-vessel activity, but prior to passenger embarkation or cargo unloading, the DOS must actually be signed. Covered vessels operating at MARSEC Levels 2 and 3 must also implement this procedure of coordination/agreement and signing. Further, those vessels required to complete a DOS at MARSEC Levels 2 and 3 are limited to manned vessels subject to the requirements of the vessel security regulations under part 104. I. Other Security Measures Under MARSEC Level 2, the Coast Guard no longer requires the use of scanning or detection equipment, mechanical devices, and canines - only intensified visual and physical inspections are required. Owners and operators of passenger vessels and ferries covered by this part that use public access facilities must address security measures for the interface of the vessel and the public access facility, in accordance with the appropriate Area Plan. J. Vessel Security Assessments and Vessel Security Plans Each time the VSP is submitted for re-approval or revisions, the Vessel Security Assessment (VSA) must be reviewed and revalidated, and the VSA report must be updated. VSPs must be submitted on or before December 31, 2003, and submission of the VSP must be in English. Owners or operators wishing to operate under an approved ASP must submit a signed letter stating which ASP the owner or operator intends to use. Owners or operators of vessels not in service on or before December 31, 2003 (as opposed to July 1, 2004), must comply with the submission requirements 60 days prior to beginning operations. Finally, the Coast Guard has clarified that the VSP amendment procedures should not be construed as limiting the vessel owner or operator from the timely implementation of additional security measures not enumerated in the approved VSP as necessary to address exigent security situations. In such cases, the owner or operator must notify the Marine Safety Center, by the most rapid means practicable, of the nature of the additional measures, the circumstances that prompted these measures, and the period of time these additional measures are expected to be in place. IV. Facility Security (68 Fed. Reg. 60515 - to be codified at 33 CFR pt. 105) A. Applicability Changes incorporated in the final rule with regard to applicability are as follows: 1. Facilities that receive vessels certified to carry more than 150 passengers, except those vessels not carrying and not embarking or disembarking passengers at the facility (final rule). The interim rule did not include the exception. 2. Facilities that receive vessels subject to SOLAS, Chapter XI; facilities that receive foreign-flag cargo vessels greater than 100 gross tons; or facilities that receive U.S. cargo vessels, greater than 100 gross register tons, subject to 46 CFR subchapter I, except for those facilities that receive only commercial fishing vessels inspected under 46 CFR part 105 (final rule). This replaces language in the interim rule related to such vessels. 3. Barge fleeting facilities that receive barges carrying, in bulk, cargoes regulated by 46 CFR chapter I, subchapters D or O, or certain Dangerous Cargoes. The interim rule did not contain the word barge to describe the type of fleeting facility. B. Public Access Areas and Facilities A public access area (defined space within a facility that is open to all persons and providing pedestrian access) designated under this rule is BLANK ROME LLP 4
exempt from the requirements for screening of persons, baggage, and personal effects and identification of persons. The final rule clarifies that a facility serving ferries or passenger vessels may designate an area within such facility as a public access area. An owner or operator of any general shipyard facility is also exempt, unless it provides certain services as delineated under this rule. The COTP may exempt a public access facility (see definition under I.A.6. above) from the requirements of the final rule, including establishing conditions for which such an exemption is granted, to ensure that adequate security is maintained. Finally, an owner or operator of a facility that receives only vessels to be laid-up, dismantled, or otherwise placed out of commission are not subject to this part, provided that the vessels are not carrying and do not receive cargo and/or passengers at that facility. C. Compliance On or before December 31, 2003, facility owners or operators must submit a Facility Security Plan (FSP) for review and approval rather than on December 29, 2003. Alternatively, should an owner or operator intend to operate under an approved ASP, they must submit a signed letter indicating which approved ASP it intends to use. On or before July 1, 2004, each facility owner or operator must be in compliance with this part rather than on June 30, 2004. In addition, owners and operators must ensure that a copy of the facility specific security assessment report generated under an approved ASP is at the facility and available to the Coast Guard upon request. When a facility must temporarily deviate from the requirements of its FSP, the facility owner or operator must notify the cognizant COTP, and either suspend operations or request and receive permission from the COTP to continue operating. D. Security Requirements Under the final rule, owners or operators must ensure (1) security for unattended vessels moored at the facility and (2) the consistency between security requirements and safety requirements. Drills or exercises required by the rule may now be satisfied with the implementation of security measures required by the FSP as the result of an increase in the MARSEC Level, provided the facility reports attainment with the new MARSEC Level to the COTP. The rule makes several changes regarding security measures for access control. These include changes to inspection obligations. Owners and operators are no longer required to implement measures to check cargo entering the facility for dangerous substances and devices. In addition, at MARSEC Level 2, owners or operators are no longer required to segregate inbound cargo, outbound cargo, and vessel stores, but are instead required to coordinate enhanced security measures with the shipper in accordance with an established agreement. Screening of persons and personal effects within a public access area is no longer required at passenger and ferry facilities during all MARSEC Levels. At MARSEC Level 2, owners and operators of passenger or ferry facilities need only increase the intensity of monitoring of the public access area. Finally, for MARSEC Level 3, owners and operators of these facilities must not only increase the intensity of monitoring in public areas but also assign additional security personnel to patrol those areas. E. Facility Security Assessment and Facility Security Plans Under the final rule, the Facility Security Assessment (FSA) requires an analysis of the use of the facility as a transfer point for nuclear, biological, radiological, explosive, or chemical weapons. The final rule also mandates the inclusion of the following new items in the FSA report: 1. A list of the persons, activities, services, and operations that are important to protect with respect to key individuals, cargo, and infrastructure (a list is provided); 2. An accounting of vulnerabilities (a list is provided); and 3. A discussion and evaluation of key facility measures and operations (a list is provided). The FSA, the FSA report, and the FSP must be protected from unauthorized exposure. The FSA must be reviewed and validated, and the FSA report must be updated each time the FSP is submitted for re-approval or revisions. The facility owner may implement additional security measures not enumerated in the approved FSP to address exigencies, but must notify the COTP by the most rapid means practicable. V. OCS Facility Security (68 Fed. Reg. 60545 - to be codified at 33 CFR pt. 106) A. Applicability The final rule applicability section is identical to the interim rule. B. Compliance Owners and operators must be operating in compliance with the OCS facility security requirements on or before July 1, 2004. Each OCS facility owner or operator must submit to the relevant District Commander by December 31, 2003, either a security plan for each OCS facility for review and approval or, if intending to submit an ASP, a letter signed by the OCS facility owner referring to the particular ASP it intends to use. Owners or operators of OCS facilities not in service before this date must comply with these requirements 60 days prior to beginning operations. When an OCS facility must temporarily deviate BLANK ROME LLP 5
from the requirements of this part, the OCS owner or operator must notify the cognizant District Commander and either suspend operations or request and receive permission to continue operating. With respect to pre-existing documentation requirements, a facilityspecific security assessment report generated under the ASP must be maintained at all times on the premises. C. Security Requirements Under the final rule, owners and operators must ensure the consistency of security requirements and safety requirements at the OCS facility. In addition, drills or exercise requirements under the final rule may be satisfied with the implementation of security measures required by an FSP as the result of an increase in the MARSEC Level, provided the OCS facility reports attainment to the district commander. D. OCS Facility Security Assessments and Facility Security Plans The OCS rule requires the inclusion of new information in an FSA. These new requirements are identical to those requirements listed in the Facility Security rule as discussed above. In addition, the OCS rule imposes the same heightened disclosure and access requirements and the same re-approval and revision requirements as those contained in If you have questions or desire assistance please contact: Jonathan K. Waldron Waldron@BlankRome.com or Jeanne M. Grasso Grasso@BlankRome.com Additional information on Blank Rome may be found on our website www.blankrome.com. the Facility Security rule. Finally, OCS facility owners and operators may implement additional security measures in exigent circumstances, provided they notify the District Commander. VI. Automatic Identification System Vessel Carriage Requirements (68 Fed. Reg. 60559 - to be codified at 33 CFR parts 26, 161, 164, and 165) The Automatic Identification System (AIS) requirements under the final rule are similar to the requirements under the interim rule. However, the Coast Guard recently published a proposed expansion AIS carriage requirements to vessels operating on certain navigable waters of the United States that are not on international voyages. In addition, the Coast Guard has revised compliance dates for the mandatory AIS carriage requirements imposed on domestic vessels transiting a Vessel Traffic Service (VTS) area. For more information regarding these publications please see Blank Rome's New Maritime Developments Advisory No. 19, available online at http://www.blankrome.com/publications/maritime/update1003_19.asp The substantive changes to the AIS requirements effect applicability. The following vessels must now have operational AIS systems by the relevant compliance date. Modifications under the final rule, modifying the interim rule requirements, have been italicized. 1. Self-propelled vessels of 65 feet or more in length, other than passenger and fishing vessels, in commercial service and on an international voyage. 2. Certain types of self-propelled vessels subject to SOLAS, as amended, that are on an international voyage (the listing of subject vessels is unchanged from the interim rule). 3. Certain vessels transiting a VTS area listed in 33 C.F.R. 161.12. The compliance date for these vessels has been extended to December 31, 2004. These vessels include: (a) self-propelled vessels of 65 feet or more in length, other than fishing vessels and passenger vessels certified to carry less than 151 passengers for hire, in commercial service; (b) towing vessels of 26 feet or more in length and more than 600 horsepower, in commercial service; and (c) passenger vessels certified to carry more than 150 passengers for hire. Recommendations The final rules modify the comprehensive maritime security regime established under the interim rules. Owners and operators of vessels and facilities and other interested parties should immediately review this rule to determine the applicability and effect of these new requirements on their operations. Owners and operators may also find interest in the Coast Guard's responses to the 438 public comments received.! Maritime Group Members Jonathan K. Waldron 202.772.5964 Alex Blanton 202.772.5909 Joan M. Bondareff 202.772.5911 James S.W. Drewry 202.772.5916 Thomas M. Dyer 202.772.5990 James B. Ellis 202.772.5993 Brett M. Esber 202.772.5919 Jeanne M. Grasso 202.772.5927 Lara B. Mathews 202.772.5941 J. Christopher Naftzger 202.772.5945 R. Anthony Salgado 202.772.5948 William L. Schachte 202.772.5800 Duncan C. Smith III 202.772.5956 Sidney A. Wallace 202.772.5931 BLANK ROME LLP 6