Regulations Amending the Life Saving Equipment Regulations: SOR/2022-136
Canada Gazette, Part II, Volume 156, Number 13
SOR/2022-136 June 10, 2022
CANADA SHIPPING ACT, 2001
P.C. 2022-655 June 10, 2022
Her Excellency the Governor General in Council, on the recommendation of the Minister of Transport, pursuant to subsection 120(1)footnote a of the Canada Shipping Act, 2001 footnote b, makes the annexed Regulations Amending the Life Saving Equipment Regulations.
Regulations Amending the Life Saving Equipment Regulations
1 Paragraph 2(1.1)(a) of Schedule IV to the Life Saving Equipment Regulations footnote 1 is amended by striking out “and” at the end of subparagraph (i), by adding “and” at the end of subparagraph (ii) and by adding the following after subparagraph (ii):
- (iii) operates only during months in which the monthly historical average daily minimum air temperature is greater than 0°C according to the climate data compiled by the Department of the Environment from the weather station nearest to the ship’s area of operation;
Coming into Force
2 These Regulations come into force on the day that, in the sixth month after the month in which they are published in the Canada Gazette, Part II, has the same calendar number as the day on which they are published or, if that sixth month has no day with that number, the last day of that sixth month.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Regulations.)
Inflatable survival equipment,footnote 2 which includes inflatable life rafts carried on board vessels, is serviced annually in order to ensure its proper deployment in all operating conditions. The annual servicing will verify that the appliance did not suffer degradation due to temperature variations, especially during frost periods, amongst other conditions. In cold weather, the inflatable survival equipment’s material can become stiff and brittle. Sudden mechanical action such as inflation while in this state may lead to a puncture of the inflatable survival equipment. Annual servicing of inflatable survival equipment is the norm for all vessels, but the Life Saving Equipment Regulations (hereafter the Regulations) allow an extended servicing period of two years for vessels operating less than seven months per year, which is intended to apply to operators, such as tour operators, that do not operate during the winter. Although they may operate for less than seven months of the year, making them eligible for the two-year servicing period, fishing vessels may start the fishing season in early spring or extend their operating period into the winter months, thus exposing inflatable survival equipment to freeze-thaw cycles.
Transport Canada (TC) is working to address a variety of navigation safety issues in Canadian waters. A review of the Regulations revealed that there is a safety risk associated with operating vessels in freezing temperatures with respect to the service requirements for inflatable survival equipment. The Regulations require vessels to carry a variety of life saving equipment, including inflatable survival equipment for use in an emergency. The Regulations also outline requirements to ensure that this equipment is properly maintained.
Schedule IV of the Regulations sets out both the servicing requirements for inflatable survival equipment carried on board vessels subject to the Regulations and the servicing interval requirements for such equipment. The servicing intervals (section 2 of Schedule IV) have been incorporated by reference into the Small Vessel Regulations (SVR) [paragraph 21(b)] and the Fishing Vessel Safety Regulations (FVSR) [paragraph 3.29(b)]. Section 2 of Schedule IV requires annual servicing of inflatable life saving equipment, but allows for a servicing interval of two years if:
- (a) the ship on which the inflatable survival equipment is carried is not a Safety Convention ship, and operates for less than seven months per year;
- (b) fewer than 15 years have elapsed since the inflatable survival equipment was manufactured;
- (c) the validity period of the most recent hydrostatic test of the gas cylinders of the inflatable survival equipment will not expire before the next servicing; and
- (d) the inflatable survival equipment is stored in a dry location during the months in which the ship is not in operation.
The extended servicing period was established to accommodate operators of small cruise ships, such as tour vessels that operate exclusively during the summer period. However, it has since been determined that some vessels that only operate for seven months of the year may be exposed to freezing temperatures. There is a safety risk associated with inflatable survival equipment being exposed to freeze-thaw cycles, as these conditions may compromise the inflatable survival equipment, leading to a possible failure of the equipment in an emergency.
Fishing vessels do not fall under the application of the Regulations. However, in 2016, section 3.29 of the FVSR was introduced to require that every life raft on board a fishing vessel comply with and be maintained in accordance with the provisions of the Life Saving Equipment Regulations. Many fishing vessels operate for only a few months of the year, depending on their fishing season and location of operation, so some operators of these fishing vessels qualify for the two-year servicing period. This longer servicing period has introduced a potential safety issue given the air temperatures present where many fishing vessels operate.
The objective of the amendment is to ensure that inflatable survival equipment is maintained in a safe manner in order to reduce the risk associated with the impact of freeze-thaw cycles on inflatable survival equipment.
The amendment requires that, in order to qualify for the two-year extended servicing period, the vessel must operate only during months in which the monthly historical average daily minimum air temperature is greater than 0°C, according to the climate data from the weather station closest to the vessel’s area of operation as compiled by the Department of the Environment.
The amendment applies to all inflatable survival equipment carried on Canadian vessels as covered under the Regulations, the FVSR and the SVR.
TC consulted with stakeholders on this amendment at the national meeting of the Canadian Marine Advisory Council (CMAC), which was held in November 2019 in Ottawa. TC also provided an update to stakeholders on the amendment at CMAC meetings held in the fall of 2020 and 2021. Information was given regarding its current status and next steps and participating stakeholders were invited to make comments and ask questions. Stakeholders have not raised concerns or issues with the amendment.
The amendment to the Regulations was prepublished in the Canada Gazette, Part I, on June 12, 2021, followed by a 60-day comment period. One comment was received during the comment period, which was a request for guidance on using historical data. The comment did not affect the proposed regulatory text and, therefore, no modification to the proposed amendment was made.
TC responded to the comment and indicated that guidance will also be provided to stakeholders through a Ship Safety Bulletin, which will be published on the date of publication of the amended Life Saving Equipment Regulations in the Canada Gazette, Part II.
Modern treaty obligations and Indigenous engagement and consultation
In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an analysis has been undertaken to determine whether the amendment may give rise to modern treaty obligations. This assessment examined the geographic scope and subject matter of the proposal in relation to modern treaties in effect and no modern treaty obligations were identified.
The status quo (i.e. the baseline scenario) was not retained, as the unintended consequences of applying the Regulations in certain freeze-thaw circumstances could lead to potential safety issues for inflatable survival equipment on some vessels. In order to eliminate unintended consequences, a regulatory amendment was considered the most effective solution. No other options were considered.
The amendment restricts the extended service interval to vessels operating during months in which the average monthly minimum temperature is above the freezing point. This means that vessels operating in freezing temperatures are not able to benefit from the 24-month extended service interval. The Regulations also apply with respect to some small commercial vessels; however, it is assumed that the small commercial vessels will continue with their current service intervals of two years since they operate in warmer temperatures. This analysis assumes that the majority of vessels impacted by the amendment will be fishing vessels located in the Atlantic and Quebec regions, as fishing vessels located in these regions represent the largest quantity of vessels operating in freezing temperatures.footnote 3 The amendment results in an estimated incremental present value cost of $74,845 from 2022 to 2031 to fishing vessel operators in the Atlantic and Quebec regions.
The costs and benefits for the amendment have been assessed in accordance with the Treasury Board of Canada Secretariat (TBS) Canadian Cost-Benefit Analysis Guide, which can be found through the Cabinet Directive on Regulation: Policy on Cost-Benefit Analysis. Where possible, impacts are quantified and monetized, with only the direct costs and benefits for stakeholders being considered in the cost-benefit analysis.
Benefits and costs associated with the amendment are assessed based on comparing the baseline scenario against the regulatory scenario. The baseline scenario depicts what is likely to happen in the future if the Government of Canada does not implement the amendment. The regulatory scenario provides information on the intended outcomes as a result of the amendment.
The analysis estimates the impact of the amendment over a 10-year period from 2022 to 2031. Unless otherwise stated, all costs are expressed in present value 2019 Canadian dollars, discounted to 2021 at a 7% discount rate.
The amendment primarily impacts fishing vessel operators in the Atlantic and Quebec regions who are eligible for the two-year servicing period. There are roughly 15 000 fishing vessels in the Atlantic region and 1 200 fishing vessels in the Quebec region. Based on information gathered by TC, 40%footnote 4 of those fishing vessels could be eligible for the two-year servicing period, roughly 6 000 located in the Atlantic region and 480 located in the Quebec region. The two-year servicing period is not widely adopted by either region, as both regions encourage annual inflatable life saving equipment servicing.
Based on information available to TC, it is assumed that 10% of fishing vessels that could be eligible for the two-year servicing period operate outside of the summer season. From those fishing vessels that operate outside of the summer season, it is assumed that 3% actually have their inflatable survival equipment serviced every two years. Therefore, based on these assumptions, it is expected that the amendment will impact approximately 18 fishing vessel operators in the Atlantic region and 2 fishing vessel operators in the Quebec region.
Baseline and regulatory scenarios
Under the baseline scenario, life saving equipment on vessels subject to the Regulations must be serviced on an annual basis. All vessels are required to keep a record of their servicing, regardless of the periodicity. Vessels that operate for less than seven months per year are eligible to service inflatable life saving equipment once every two years. The vessels that meet the criteria and that chose to have their inflatable life saving equipment serviced every two years must also keep maintenance manuals for that equipment which is serviced once every two years.
Under the regulatory scenario, the two-year servicing period remains applicable to affected vessels that operate for less than seven months per year, but is limited to those operating where the average local air temperature does not go below the freezing point. This amendment means that a portion of vessels previously eligible to opt for the two-year servicing period are no longer able to benefit from that option.
Benefits and costs
The amendment specifies that the two-year servicing option is available to vessels that operate for less than seven months per year and where the average local air temperature is greater than 0°C, resulting in a small portion of vessels that would not qualify for the servicing flexibility. It is important to note that this analysis assumes that the most significantly impacted vessels are fishing vessels located in the Atlantic and Quebec regions. It is possible that the amendment will affect a small portion of other types of vessels located across the country. However, given that the most significantly impacted vessels are only estimated to be 20 vessels in total, it is expected that the impact on vessels in other regions will be negligible.
Some fishing vessel owners in the Quebec region and the Atlantic region will incur costs, as these fishing vessels will no longer benefit from one service every two years and will require annual servicing. The amendment will result in an estimated incremental cost of $74,845 over the 10-year analytical time frame, of which $7,465 will be incurred by fishing vessel owners in the Quebec region, and $67,182 by fishing vessel owners in the Atlantic region. The incremental costs also include $198 in administrative cost for record keeping ($178 for the Atlantic Region and $20 for the Quebec region).
The amendment will impose costs that are mainly expected to affect fishing vessel owners in the Quebec and Atlantic regions. The total cost of $74,845 is broken down by an incremental compliance cost of $74,647 and an administrative cost of $198.
The affected fishing vessel owners will be required to service their inflatable survival equipment once every year, as opposed to once every two years. Servicing of inflatable survival equipment is done by servicing stations accredited by the manufacturers of the equipment and is estimated to cost an average of $1,100footnote 5 per service. This will result in an incremental cost to fishing vessel owners in the Atlantic region of $67,182 and $7,465 to fishing vessel owners in the Quebec region.footnote 6 The incremental cost will begin in 2023footnote 7 and occur every other year. As a result, the total compliance cost of the amendment is estimated to be $74,647 between 2022 and 2031.
Under the baseline scenario, the Regulations have a requirement for vessel owners to keep a record of service certificates. Under the amendment, the frequency of record keeping will increase for the estimated 20 affected stakeholders, from once every two years, to annually. It is assumed that it will take five minutes to file the record and the additional administrative burden will begin in 2023footnote 7 and occur every other year. Using an average salary of a fishing vessel owner, this will result in an incremental administrative cost to the Atlantic region of $178 and $20 for the Quebec region. The total administrative cost is estimated to be $198 between 2022 and 2031.
By adding a stakeholder eligibility criterion for servicing every two years, the amendment will mitigate the safety risk associated with the impact of freeze-thaw cycles on inflatable survival equipment. For example, freeze-thaw cycles can increase the risk of inflatable survival equipment not functioning properly. Therefore, by mitigating this risk, the amendment is expected to prevent injury and lives lost at sea. In addition, the amendment will continue to provide flexibility for vessels operating in areas with mild weather by continuing to allow the two-year servicing period if all of the criteria are met.
Small business lens
The small business lens applies as there are impacts on small businesses associated with the amendment. According to Innovation, Science and Economic Development Canada, the fishing industry is made up of 99% of small businesses, where a small business is defined as having 1 to 99 employees. As a result, this analysis assumes that all 20 of the affected stakeholders are small businesses. As previously mentioned, the two-year servicing period is not widely adopted within the fishing vessel industry in either region. This is because many of the fishing vessel owners already receive servicing annually. TC did not consider more flexible approaches to minimize the cost impacts on small business, as the number of affected stakeholders is already limited. Further, a flexible approach was not considered as the amendment aims to mitigate safety risks arising from the use of life saving equipment that has been subjected to sub-zero temperatures. Over the 10-year analytical time frame, the estimated total cost of the amendment will be approximately $4,000 per business, annualized to $540 per business.
The one-for-one rule applies since there is an incremental increase in administrative burden on business. Using the methodology developed in the Red Tape Reduction Regulations, the implementation of the amendment will result in an annualized “IN” of $13, or $0.64 annualized administrative cost per business to the affected stakeholders (present value, using a 7% discount rate, expressed in 2012 Canadian dollars).
Regulatory cooperation and alignment
This amendment is not related to a work plan or any formal regulatory cooperation framework. However, the amendment aligns broadly with the Transportation Safety Board of Canada’s interest in improving safety within the commercial fishing industry, including the maintenance of life saving appliances.
Strategic environmental assessment
In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary analysis concluded that a strategic environmental assessment was not required.
Gender-based analysis plus (GBA+)
The amendment focuses on improving the safety culture within the marine industry and is therefore not expected to have differential impacts on the basis of identity factors such as gender, race, ethnicity, sexuality, religion, age, etc. However, as noted in the section on costs and benefits, some vessel operators in the Quebec and the Atlantic regions (approximately 20) will be affected differentially by having to service their life rafts annually instead of every two years.
Implementation, compliance and enforcement, and service standards
The regulatory amendment will come into effect six months following final publication in the Canada Gazette, Part II, providing regulated entities with sufficient time to comply with the revised servicing requirements. Following publication in the Canada Gazette, stakeholders will be notified through a Ship Safety Bulletin and by the CMAC on the day of the Canada Gazette, Part II, publication.
Compliance and enforcement
Compliance and enforcement are done through regular regulatory or monitoring inspections by TC and inspectors will continue to apply regulations with the tools conferred by the Canada Shipping Act, 2001 (CSA 2001). Under the CSA 2001, the authorized representative of a Canadian vessel shall ensure that the vessel and its machinery and equipment meet the requirements of the regulations made under the Act. Failure to comply with such requirements could result in the issuance of an administrative monetary penalty of up to $25,000.
Life Saving Equipment Regulations Manager
Marine Safety and Security
Place de Ville, Tower C
330 Sparks Street, 11th Floor