US Type approval and business drop outs
Perhaps it was the demise and re-birth of ballast water treatment system maker OceanSaver that was the spur or maybe it is just a reaction to the trend for mergers and acquisitions but the USCG has felt the need to offer some explanations of what happens if a manufacturer of US type-approved equipment goes out of business? It would appear that the IMS Group acquisition of OceanSaver has preserved the type-approved status of systems now in use but there are some important aspects to consider based upon the USCG’s information. Apparently all equipment manufactured during the validity of the type approval certificate remains “Approved” as long as it is manufactured, installed, and operated according to the terms of the type approval certificate. Any maintenance and repairs to this equipment must also be performed in accordance with the manuals and components specified as part of the type approval. If the equipment fails to operate and parts from the original equipment manufacturer are no longer available, then the equipment is no longer operating under its type approval and must be replaced. USCG Type approval certificates are issued for five years. After five years, only the manufacturer listed on the certificate can request renewal, unless otherwise transferred as noted below. After a period of five years, if not renewed, the certificate will be placed in an “Expired” status. At this point, the product is no longer approved for production, but items manufactured prior to the expiration of the approval remain “Approved” as described above. If another company purchases the original manufacturer and wants to retain type approval, the company must contact the Coast Guard to request that the certificate be updated to reflect the name and address of the new company. The certificate will be updated with a revision number, and the previous number issued to the original manufacturer will be marked “Former-May Use.” This allows any equipment manufactured by the original manufacturer during the period of validity of the certificate to continue to be installed. Further, the new entity can continue to produce the system as long as it is manufactured, installed, and operated according to the terms of the type approval certificate. If the new entity intends to make changes to the design, then they must do so in accordance with the requirements for changes to approved systems in 46 CFR 162.060-16. Not all equipment onboard non-US flagged ships in US waters needs to be approved by the USCG but ballast water treatment systems do. Currently there are almost 100 different systems available but only five have USCG type-approval. That number will grow but once the retrofit bonanza is over and business is limited to new build ships it is almost certain that the number of system makers will fall to a sustainable level of perhaps ten to fifteen makers. Ensuring that any system fitted to a ship planning to trade in US waters for a reasonable number of years will mean that the operator must ensure that OEM spare parts necessary for type approval will continue to be available for the lifetime of the equipment. That suggests that shipowners need to make their choices based on the survivability of the OEM when only newbuilding installations are available. That may not be an easy task but it should help manufacturers who can demonstrate a fair degree of staying power.