Decree No. 111/2016/ND-CP on Conditions for Operating Shipbuilding, Conversion, and Repair Services

DECREE

Regulations on Conditions for Operating Shipbuilding Services

Including New Construction, Conversion, and Repair of Ships

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Pursuant to the Law on Government Organization dated June 19, 2015;

Pursuant to the Maritime Law of Vietnam dated January 25, 2015The Government promulgates this Decree stipulating conditions for operating shipbuilding services including new construction, conversion, and repair of ships.This Decree stipulates conditions for operating shipbuilding services including new construction, conversion, and repair of ships, except for facilities solely engaged in new construction, conversion, and repair of ships for national defense and security purposes and facilities solely engaged in new construction, conversion, and repair of fishing vessels.5;

Pursuant to the Investment Law dated November 26, 2014;

At the proposal of the Minister of Transport;

the Government detailing certain provisionsThis Decree applies to organizations and individuals involved in operating shipbuilding services including new construction, conversion, and repair of ships in Vietnam.1. A Class 1 shipyard is a facility that meets all conditions for new construction and conversion of all types of ships.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of Regulation

2. A Class 2 shipyard is a facility that meets all conditions for new construction and conversion of passenger ships with a capacity of less than 100 passengers; non-passenger ships with a designed length smaller than 90 meters, except oil tankers with a gross tonnage of 1,000 GT or more, chemical tankers carrying dangerous chemicals, and liquefied gas carriers.

Article 2. Applicability

New construction of ships is the process of manufacturing ships from laying the keel to delivery and commissioning.

Article 3. Explanation of Terms

In this Decree, the following terms are understood as follows:

4. Conversion of ships involves changing one or more of the following parameters of the ship:

a) Main dimensions;

b) Purpose;

c) Degree of compartmentation of the hull;

d) Cargo volume;

e) Passenger accommodation area.

5. Repair of ships is the activity of repairing and restoring ships on slipways, dry docks, or repair sites after the ships have been lifted out of the water.

Article 4. General Conditions

1. Facilities for new construction, conversion, and repair of ships must be enterprises established and operating in accordance with the provisions of the law.

2. Facilities for new construction, conversion, and repair of ships must comply with the conditions stipulated in this Decree and other relevant legal provisions.

CONDITIONS FOR OPERATING SHIPBUILDING SERVICES INCLUDING NEW CONSTRUCTION AND CONVERSION OF SHIPS

Article 5. Conditions Regarding Technical Staff, Quality Inspection Personnel, and Shipbuilders

1. Shipyards must have separate technical departments and quality inspection departments meeting the requirements for new construction and conversion of ships, with a minimum number of staff in each department as follows:

Chapter II

a) For Class 1 shipyards: four university graduates specializing in shipbuilding, four university graduates specializing in marine engines, and two university graduates specializing in marine electrical systems;

b) For Class 2 shipyards: two university graduates specializing in shipbuilding, two university graduates specializing in marine engines, and one university graduate specializing in marine electrical systems.

2. Technical staff and quality inspection personnel must have at least 24 months of experience in new construction, conversion, or repair of ships.

3. Shipyards with metal-hulled ships must ensure a minimum of five metal welders, two mechanics, three electricians, and three painters in compliance with the national technical standards for shipbuilding and repair facilities. Metal welders must hold certificates certifying their professional qualifications in accordance with the national technical standards for classification and shipbuilding or equivalent.

4. Shipyards with non-metallic-hulled ships must ensure a minimum of three ship hull fabricators, one mechanic, one electrician, and two painters in compliance with the national technical standards for shipbuilding and repair facilities.

2. Technical staff and quality inspectors must have at least twenty-four months of experience in the field of building new ships, converting ships, or repairing ships.

3. Shipbuilding facilities with metal hulls must ensure having at least five metal welders, two mechanics, three electricians, and three painters in accordance with national technical standards for shipbuilding and repair facilities. Metal welders must hold certificates certifying their professional qualifications in accordance with national technical standards on classification and shipbuilding or equivalent.

4. Shipbuilding facilities with non-metallic hull materials must ensure having at least three boat hull makers, one mechanic, one electrician, and two painters in accordance with national technical standards for shipbuilding and repair facilities.

Article 6. Material and technical conditions, equipment

Ensure sufficient material and technical facilities, equipment necessary in accordance with national technical standards for new shipbuilding and repair facilities.

1. Have sufficient human resources and plans to ensure safety and labor hygiene in accordance with the provisions of Government Decree No. 39/2016/NĐ-CP dated May 15, 2016 detailing certain articles of the Law on Safety and Labor Hygiene and Government Decree No. 37/2016/NĐ-CP dated May 15, 2016 detailing and guiding implementation of certain articles of the Law on Safety and Labor Hygiene regarding mandatory work injury and occupational disease insurance.

2. Have sufficient fire safety conditions and firefighting plans in accordance with the provisions of Government Decree No. 79/2014/NĐ-CP dated July 31, 2014 detailing implementation of certain articles of the Law on Fire Prevention and Combating and the Law Amending and Supplementing Certain Articles of the Law on Fire Prevention and Combating.

1. Ensure sufficient means to receive and recover waste from ships for treatment in accordance with the International Convention for the Prevention of Pollution from Ships (MARPOL), to which Vietnam is a member.

2. Have environmental protection files approved by competent authorities in accordance with the Law on Environmental Protection and Government Decree No. 18/2015/NĐ-CP dated February 14, 2015 on environmental planning, strategic environmental assessment, environmental impact assessment, and environmental protection plans.

3. Ensure sufficient human resources, systems, works, and equipment to manage and treat waste generated at the facility in accordance with Article 68 of the Law on Environmental Protection.

1. Shipbuilding facilities of type 1 must establish and maintain application of a quality management system according to ISO 9001 or equivalent, and a safety and environmental management system according to ISO 14001 or equivalent.

2. Shipbuilding facilities of type 2 must establish work procedures for new construction and conversion of ships in compliance with national technical standards on classification and shipbuilding.

Chapter III

CONDITIONS FOR OPERATING SHIP REPAIR SERVICES

Article 10. Conditions relating to technical staff, quality inspection personnel, and ship repair workers

1. Ship repair facilities must have separate technical and quality inspection departments meeting repair requirements, each department must have at least one university graduate in marine shipbuilding engineering, one university graduate in marine engine engineering, and one intermediate-level specialist or vocational college graduate in marine electrical engineering.

2. Technical staff and quality inspectors must have at least twelve months of experience in new construction, conversion, or ship repair.

3. Ship repair facilities with metal hulls must ensure at least three metal welders, one mechanic, one electrician, and two painters in accordance with national technical standards for new shipbuilding and repair facilities. Metal welders must hold certificates of qualification in accordance with national technical standards on classification and shipbuilding or equivalent.

4. Ship repair facilities with non-metallic hulls must ensure at least two ship hull fabricators, one mechanic, one electrician, and one painter in accordance with national technical standards for new shipbuilding and repair facilities.

Article 11. Material and technical conditions

Ensure sufficient material and technical facilities, equipment necessary in accordance with national technical standards for new shipbuilding and repair facilities.

1. Have sufficient human resources and plans to ensure safety and labor hygiene in accordance with the provisions of Government Decree No. 39/2016/NĐ-CP dated May 15, 2016 detailing certain articles of the Law on Safety and Labor Hygiene and Government Decree No. 37/2016/NĐ-CP dated May 15, 2016 detailing and guiding implementation of certain articles of the Law on Safety and Labor Hygiene regarding mandatory work injury and occupational disease insurance.

2. Have sufficient fire safety conditions and firefighting plans in accordance with the provisions of Government Decree No. 79/2014/NĐ-CP dated July 31, 2014 detailing implementation of certain articles of the Law on Fire Prevention and Combating and the Law Amending and Supplementing Certain Articles of the Law on Fire Prevention and Combating.

1. Ensuring sufficient facilities for receiving and recovering waste from ships in accordance with the regulations of the International Convention for the Prevention of Pollution from Ships (MARPOL) to which Vietnam is a member.

2. Having all environmental protection documents approved by the competent authority in accordance with the Law on Environmental Protection and Decree No. 18/2015/NĐ-CP dated February 14, 2015 of the Government on environmental planning, strategic environmental assessment, environmental impact assessment, and environmental protection plans.

3. Ensure sufficient human resources, systems, works, and equipment to manage and treat waste generated at the facility in accordance with Article 68 of the Law on Environmental Protection.

Ship repair facilities must establish ship repair procedures in compliance with national technical standards on classification and shipbuilding.

Chapter IV

RECOGNITION AND RENEWAL OF QUALIFIED FACILITIES

NEW CONSTRUCTION, MODIFICATION, AND REPAIR OF SHIPS

Article 15. Competence for recognition and renewal of qualified facilities for new construction, modification, and repair of ships

The Vietnam Maritime Administration under the Ministry of Transport shall be responsible for organizing the implementation of recognition and renewal of qualified facilities for new construction, modification, and repair of ships in accordance with this Decree and publishing the list of qualified facilities on the Vietnam Maritime Administration's website.

Article 16. Documents and procedures for recognition and renewal of qualified facilities for new construction, modification, and repair of ships

1. Organizations and individuals submit applications directly, send via postal service, or through other appropriate means to the Vietnam Maritime Administration.

2. The application for recognition of qualified facilities for new construction, modification, and repair of ships includes:

a) Application form according to Model No. 01 stipulated in the Appendix issued together with this Decree;

b) Description of necessary material conditions related to production (facility layout diagram, office space, workshops, warehouses, production equipment, measuring and testing devices);

d) List of technical staff and quality inspectors with copies of relevant certificates and diplomas.

3. When the notification of qualified facilities for new construction, modification, and repair of ships expires, or when the facility requests modifications or additions to recognized categories, organizations and individuals submit applications for renewed recognition to the Vietnam Maritime Administration. The application includes:

a) Application form according to Model No. 01 stipulated in the Appendix issued together with this Decree;

b) Report on the operation of the facility since its recognition or renewed recognition;

4. Procedures for recognition and renewal of qualified facilities for new construction, modification, and repair of ships:

a) Organizations and individuals seeking recognition or renewed recognition of qualified facilities for new construction, modification, and repair of ships submit one set of application documents to the Vietnam Maritime Administration; pay related costs for evaluation and examination in accordance with the law;

b) Within three working days from the date of receipt of the application, if the application is incomplete, the Vietnam Maritime Administration guides organizations and individuals to complete the application in accordance with this Decree; if the application is complete, it responds in writing and agrees on the time for on-site inspection within five working days;

c) The Vietnam Maritime Administration conducts on-site inspections at the facility. If the inspection results are satisfactory, the Vietnam Maritime Administration issues Notification of Qualified Facilities for New Construction, Modification, and Repair of Ships according to Model No. 02 stipulated in the Appendix issued together with this Decree and publishes the list of qualified facilities on the Vietnam Maritime Administration's website within one working day from the end of the on-site inspection.

If the inspection results are unsatisfactory, the Vietnam Maritime Administration must issue a letter to the facility detailing the reasons for non-compliance within one working day from the end of the on-site inspection.

Article 17. Duration of Effectiveness of the Notification on Meeting Conditions for Building, Converting, and Repairing Ships

The duration of effectiveness of the Notification on Meeting Conditions for Building, Converting, and Repairing Ships is five years from the date of issuance.

Article 18. Revocation of the Notification on Meeting Conditions for Building, Converting, and Repairing Ships

1. The Vietnam Maritime Administration shall revoke the Notification on Meeting Conditions for Building, Converting, and Repairing Ships in the following cases:

a) At the request of the entity;

b) The quality management system is not maintained in accordance with regulations;

c) The conditions prescribed by this Decree are not maintained during operation.

2. The Vietnam Maritime Administration shall send a revocation notice to the entity and remove its name from the list of entities meeting conditions for building, converting, and repairing ships on the Vietnam Maritime Administration's electronic information website in the cases stipulated in Clause 1 of this Article.

Chapter V

IMPLEMENTATION

Article 19. Responsibility for implementation organization

1. The Ministry of Transport shall have the responsibility:

a) To unify the management of business activities providing services for building, converting, and repairing ships;

b) To direct the Vietnam Maritime Administration to organize, guide, and evaluate the recognition of entities meeting conditions for building, converting, and repairing ships as prescribed in this Decree; periodically conduct specialized inspections every five years or at random to ensure that entities maintain the conditions prescribed in this Decree; implement the application of information technology in management, evaluation, and recognition of entities meeting conditions for building, converting, and repairing ships and manage related data; report on the results of the work of evaluating and recognizing entities meeting conditions for building, converting, and repairing ships as prescribed;

c) To organize inspections, checks, and handle violations of the implementation of regulations on business operations and business conditions for services of building, converting, and repairing ships as prescribed in this Decree and other relevant laws;

d) To organize the development, supplementation, amendment, and promulgation of national technical standards related to shipbuilding, conversion, and repair facilities to ensure compatibility with the level of shipbuilding technology development both domestically and internationally.

2. The Ministry of Natural Resources and Environment shall be responsible for leading and coordinating with the Ministry of Transport to provide specific guidance on environmental pollution prevention plans for shipbuilding, conversion, and repair facilities in accordance with the provisions of the law.

3. The Ministry of Public Security shall be responsible for leading and coordinating with the Ministry of Transport to provide specific guidance on fire and explosion prevention plans for shipbuilding, conversion, and repair facilities in accordance with the provisions of the law.

4. The Ministry of Science and Technology shall be responsible for leading and coordinating with the Ministry of Transport to organize the calibration and verification of measurement and inspection equipment in accordance with the provisions of the law on measurement.

5. The People's Committee of the province shall, based on their functions, tasks, and authorities as prescribed, be responsible for state management over the activities of shipbuilding, conversion, and repair facilities operating within their jurisdiction in accordance with the law.

6. Shipbuilding, conversion, and repair facilities shall be responsible for implementing the regulations on business conditions prescribed in this Decree and other relevant laws; maintaining business conditions during their operation.

Article 20. Inspection and Supervision System for Business Conditions

New shipbuilding, conversion, and repair facilities shall be subject to specialized inspection and supervision by the competent authority on business conditions and during their operation as prescribed by law.

Chapter VI

IMPLEMENTING PROVISIONS

Article 21. Effective Date

This Decree takes effect from July 1, 2016.

Article 22. Transitional Provisions

Shipbuilding, conversion, and repair facilities established before July 1, 2016 shall continue to operate and must comply with all provisions of this Decree from July 1, 2019.

Article 23. Implementation Organization

1. The Minister of Transport shall be responsible for chairing and coordinating with relevant ministries, sectors, and provincial People's Committees under central cities to implement this Decree.

2. Ministers, heads of ministerial-level agencies, heads of government agencies, and chairpersons of provincial people's committees directly under the central government are responsible for implementing this Decree./.