Pursuant to the pertinent provisions of PD 474, EO 125 and R.A. 9295, as amended, and International Maritime Organization Resolution A.739(18), and A.789(19), the following guidelines are promulgated to govern the accreditation and/or authorization of ship classification societies and other entities intending to establish a classification society to cater to the needs of the Philippine domestic fleet.

Section 1. OBJECTIVE:

1. To authorize IACS members and other reputable International Classification Organizations to perform classification of ships and High Speed Craft in the domestic trade.
   
   
2. To accredit only one (1) local classification organization to cater to the classification requirements of ships in the domestic trade.
   
   
3. To institutionalize a Philippine Government (PG) Classification System to cater to the classification requirements for non convention wooden hulled ships and ships 35 GT and below.
   
   
4. To set up guidelines and procedures in the supervision and audit of all Administration accredited and/or authorized organizations performing classification work for ships.
   
   
5. To identify responsibilities of accredited and/or authorized classification organization performing classification.

Section 2. COVERAGE:

This Circular shall apply to all shipping companies, shipowners/ operators, all local classification organizations duly organized and authorized under existing Philippine laws, all recognized members of the International Association of Classification Societies (IACS) and other reputable international classification organizations engaged in the classification of ships in the domestic trade.

Section 3. DEFINITION OF TERMS:

1. Administration - refers to the Maritime Industry Authority (MARINA).
   
   
2. Classification Organization - a non-stock, non-profit organization, local or international, that establishes and applies technical standards in relation to the design, construction and survey of marine related facilities including ships and offshore structures.
   
   
3. Ship Classification - the process performed by a classification organization to ensure that a ship is designed, constructed and maintained in accordance with the rules established by that classification society.
   
   
4. Accreditation - refers to the process of qualifying Organizations to conduct classification activities for ships.
   
   
5. Authorization - refers to the process of qualifying IACS members and other reputable international classification organizations to conduct classification activities for ships.
   
   
6. Local Classification Organization - refers to a non-stock, non-profit organization organized under existing Philippine laws in order to comply with the Administration policy of accrediting only one classification society for the purpose of classing ships, above 35 GT in the domestic trade.
   
   
7. PHILIPPINE GOVERNMENT CLASS (PG Class) SYSTEM - refers to the classing non convention wooden hull ships and ships 35 GT and below by Administration technical personnel following the regulations set by this Circular.

Section 4. ACCREDITATION AND/OR AUTHORIZATION OF ORGANIZATIONS FOR THE CONDUCT OF CLASSIFICATION.

1. The Administration, in the exercise of its authority and prerogative as Flag State Administration hereby adopts the policy of accrediting only one (1) local classification organization.
   
   
2. The Administration may also authorize members of the International Association of Classification Societies (IACS) and other reputable international classification organizations presently performing classification of ships in the international and domestic trade.
   
   
3. Accreditation shall serve as prerequisite to the grant of permits, authorities and incentives pertaining to classification activities, which are presently administered, or to be administered, by the Administration.
   
   
4. No Organization without a Certificate of Accreditation or Authorization from the MARINA shall be authorized to undertake classification service of domestic fleet. Only Surveyors of Accredited Organization shall be authorized to perform classification of domestic ships required to be classed.
   
   
5. Convention sized ships in the domestic trade currently classed by IACS shall not be allowed to change to local class unless for economic reason.

Section 5. MINIMUM STANDARDS FOR AN ACCREDITED ORGANIZATION

1. The organization shall define and document its policy and objective for, and commitment to, quality and ensure that this policy is understood, implement and maintained.
   
   
2. The organization shall be governed by principles of ethical behavior which should be contained in a Code of Ethics and as such recognize the inherent responsibility associated with a delegation of authority to include assurance as to the adequate performance of services as well as the confidentiality of related information, as appropriate.
   
   
3. The organization shall allow the participation of qualified technical representatives of the Administration and other parties concerned in the development of its rules and/or regulations.
   
   
4. The organization must maintain its own website which must contain all relevant ship records and provide the Administration electronic access thereto.
   
   
5. The organization must establish procedure to request records from other classification societies that previously classed the ship.
   
   
6. The organization should provide the Administration every 15th of January a list, in electronic form, of the ships surveyed of the preceding year including ship name, type of service and IMO numbers.
   
   
7. The organization should keep records of persons acting on its behalf and be made available to the Administration.
   
   
8. The organization should provide for the publication and systematic maintenance of rules and/or regulations in the English language for the design, construction and certification of ships and their associated essential engineering systems as well as the provision of an adequate research capability to ensure appropriate updating of the published criteria.
   
   
9. The organization should be established with:
   
   9.1 A significant number of managerial, technical and support staff, capable of developing and maintaining rules and/or regulations.
   9.2 At least twenty (20) technical personnel and ten (10) support staff to provide the required service.
   
   
10. The organization should demonstrate the technical, administrative and managerial competence and capacity to ensure the provision of quality services in a timely fashion.
    
    
11. The Administration shall conduct regular annual and random audit of the organization to ensure that all rules, guidelines and policies of the administration are complied with.

Section 6. QUALIFICATION REQUIREMENTS

1. The organization so established must be non-stock, non-profit.
   
   
2. Officers and employees of the organization must not have commercial interest related to the design, construction, ownership, operation, management, maintenance or repairs, insurance or chartering of ships.
   
   
3. The organization ™s working group must be able to render the following services:
   
   3.1 Classification services - to develop and administer the technical standards for the design, construction and periodical survey of ships and other marine structures such as mobile offshore unit;
   3.2 Technical Advisory services - to render advisory services related to ship design, construction, revision of rules referred to by the Administration.
   3.3 Logistical and Personnel services - to service domestic fleet geographically distributed in the different parts of the country.
   3.4 Other services as may be deemed necessary and appropriate by the Administration.
   
   
4. Local Class Organization should establish offices in the following areas which must have at least two (2) surveyors:
   
   4.1   La Union
   4.2   Metro Manila
   4.3   Batangas
   4.4   Legazpi
   4.5   Iloilo
   4.6   Cebu
   4.7   Tacloban
   4.8   Zamboanga
   4.9   Cagayan
   4.10  Davao
   4.11  General Santos
   
   
5. The quality system of the organization shall be certified in accordance with the ISO 9000 series or its subsequent amendments, by an internationally recognized independent body of auditors/certifying body within a period of one (1) year from its initial accreditation. Certification under ISO 9000 series, issued by a member of an internationally accepted classification society is acceptable and given preference.
   
   
6. Local Class Organization must have in its employ the following with good moral character, unquestionable integrity and who shall not be more than sixty (60) years of age:

 

License

Work Experience
    (Within the last Five [5] years)

Number

Naval Architect and Marine Engineer Five (5) years as Naval Architect and Marine Engineer Four (4) Chief Engineer Five (5) years as Chief Marine Engineer Four (4) Master Mariner Five (5) years as Master Mariner Four (4) Mechanical Engineer, Electrical Engineer Ten (10) years working experience as superintendent and/or division manager in a MARINA-accredited shipyard Four (4) ME
Four (4) EE

Section 7. DOCUMENTARY REQUIREMENTS:

1. SEC Registration Certificate as a non-stock, non-profit entity.
   
   
2. For IACS members and reputable international classification organization proof of registration at the country where its headquarter is located.
   
   
3. Articles of Incorporation and By-Laws.
   
   
4. List of surveyors, technical, managerial and support staff, including their curriculum vitae detailing their respective qualifications and experiences.
   
   
5. Code of Ethics
   
   
6. Classification Rule Books for the design, construction and certification of ships subject to certification under SOLAS Convention for organization performing classification on convention size ships and High Speed Craft.
   
   
7. Classification Rule Books for the design, construction and certification of ships subject to certification under the Administration ™s standards, regulations and the SSIS for organization performing classification on non-convention size ships.
   
   
8. Schedule of all fees to be charged including escalation rates and frequency.
   
   
9. Documented system of the organization ™s development, implementation and maintenance of an effective internal quality system based on appropriate recognized quality standards no less effective than ISO series, and which, inter alia, ensures that:
   
   9.1 the organization ™s rules and/or regulation are establish and maintained in a systematic manner, and are reviewed and amended following a documented procedure;
   9.2 the organization ™s rules and regulations are complied with;
   9.3 the responsibilities, authorities, and interrelation of personnel whose work affects the quality of the organization ™s service are defined and documented;
   9.4 all works are carried out under controlled condition;
   9.5 a supervisory system is in place, which monitors the actions and work, carried out by the organizations;
   9.6 a system of qualification of surveyors and continuous updating of their knowledge;
   9.7 records are maintained, demonstrating achievement of the required standards in the items covered by the services performed as well as the effective operation of the quality systems; and,
   9.8 a comprehensive system of planned and documented internal audits of the quality - related activities in all location is implemented.

Section 8. PROCEDURE FOR ACCREDITATION:

1. The applicant shall file with the MARINA an application in writing duly supported by the above-mentioned documentary requirements.
   
   
2. Incomplete documentary requirements shall not be accepted. Mailed application with incomplete requirement shall be immediately returned to the applicant.
   
   
3. A written statement that the procedures and records of the organization regarding its action involving safety management audits and certification are available for review annually and at any time deemed necessary by the Administration.
   
   
4. The Administration shall establish a committee to evaluate all the documents submitted and verify that the Organization ™s system is implemented in all its offices.
   
   
5. The Certificate of Accreditation shall be issued after evaluation of all documents submitted and verification that the organization complies with the aforementioned requirements.

 
Section 9. RESPONSIBILITY OF ACCREDITED ORGANIZATION

1. Accredited and or authorized organizations shall report to the Administration information pertaining to services performed pursuant to this circular, as follows:
   
   1.1 Reporting of Unfit Condition
   
   The Accredited and/or Authorized organization shall report, within twenty four (24) hours, to the Administration if a ship is discovered to be operating with faults or defects which represent significant deviations from the standards required in International Conventions and/or the Administration ™s standards, such that the ship is not fit to proceed to sea without danger to the ship and persons on board. The obligation to provide such information applies regardless as to how such deficiencies are discovered. Further, the accredited and/or authorized organization shall report to the Administration any accident involving ships classed by them.
   
   1.2 Reporting of Suspension and/or withdrawal of Class
   
   The Accredited and/or Authorized organization shall report, within twenty four (24) hours, to the Administration any suspension and/or withdrawal of class.
   
   1.3 Reporting of Rules and other documents
   
   The Accredited and/or Authorized Organization shall furnish the Administration with its rules and their amendments for Building and Classing Vessels and of its records and other documents, showing the standards of the organization, and which can provide the latter with data to assist in the interpretation of convention regulations.

Section 10. VALIDITY OF CERTIFICATES

The Certificate of Accreditation and/or Authorization shall be valid for a period of ten (10) years. The certificate and/or authorization cannot be transferred or alienated in whatever manner and its use by another shall not be allowed.

Section 11. FEES AND CHARGES

The fees and charges shall be as follows:

Accreditation	Php 250,000.00 for local organization
Annual Audit Fee for Accredited Entities	Php 25,000.00 per office
Authorization	$ 5,000.00 or its peso equivalent

The above fees shall be exclusive of the documentary stamps required by law to be affixed on the certificate.

Section 12. SUBMISSION OF REPORTS AND OTHER DOCUMENTS

The MARINA accredited and/or authorized Organization under this Circular shall submit the following reports and/or documents:

1. Updated listings of ship surveyors (if any) - within fifteen (15) days from occurrence;
   
   
2. Replacement of approving officers/signatory(ies), if any - on or before replacement date; and,
   
   
3. Organization ™s Annual report - within the first quarter of the following year.

The foregoing reports/documents shall either be the original or true copies of the original duly attested by an authorized representative of the organization.

Section 13. SUPERVISION AND AUDIT

The Administration, in line with its authority to accredit organizations, shall exercise supervision and conduct annual management, financial and performance audit of Accredited and/or Authorized Organizations, pursuant to relevant International issuances for international organizations and Rule VII, Sec. 3 of the IRR for R.A. No. 9295 for local class. (See Annex A)

Section 14. ADMINISTRATIVE SANCTIONS

1. 1. The Administration shall issue Show Cause Order based on the following grounds:
   
   1.1 Failure to maintain quality standards;
   1.2 Failure to maintain the conditions for accreditation in preceding section; and
   1.3 Willful and/or gross violation of any rule/regulation and of any of the general and specific Terms and Condition of Accreditation/Authorization.
   1.4 Violation of any provision of this Circular.
   
   
2. 2. After due process, the following fines and penalties, per offense, shall be imposed against the accredited and/or authorized organizations:
   
   2.1 First Offense = Php 250,000.00
   2.2 Second Offense = Php 500,000.00 + suspension of certificate for at sixty (60) days but not to exceed ninety (90) days
   2.3 Third Offense = Php 750,000.00 + Cancellation of Certificate

Section 15. PHILIPPINE GOVERNMENT CLASSIFICATION SYSTEM

1. The Administration hereby establishes the PHILIPPINE GOVERNMENT CLASS (PG Class), which shall undertake classification for non convention wooden hulled ships and ships 35 GT and below.
   
   
2. The PG Class will be composed of personnel of the Administration and shall be so trained and qualified according to a set of procedures developed for the purpose.
   
   
3.  Only duly designated Administration Surveyors shall be authorized to perform classification of domestic ships required to be classed.
   
   
4. The PG Class may undertake the activities of local class in case the Certificate of Accreditation of the latter is suspended and/or withdrawn.
   
   
5. The classification activities to be undertaken by the PG Class shall cover non-convention wooden hulled ships and ships 35 GT and below and shall follow the Procedures, Rules and Guidelines developed by the MARINA. (See Annex B^* )

Section 16. REPEALING CLAUSE

MARINA Circular No. 165 is hereby repealed. Any provision of other MARINA circulars otherwise inconsistent herewith is modified/amended accordingly.

Section 17. SEPARABILITY CLAUSE

Should any provision or part of this Circular be declared by competent authority to be invalid or unconstitutional, the remaining provisions or parts hereof shall remain in full force and effect and shall continue to be valid and effective.

Section 18. TRANSITORY PROVISION

1. Existing accreditation issued to a local classification society shall be deemed expired on March 31, 2010. It may continue to issue Interim Class Certificate with a validity until March 31, 2010 only. However fifteen (15) days after publication of this Circular they shall cease issuing Full Term Class Certificate.
   
   
2. IACS members currently engaged in classification of domestic ships shall apply and acquire authorization under the provisions of this Circular not later than March 31, 2010.

Section 19. EFFECTIVITY CLAUSE

This Circular shall take effect immediately upon its publication once in a newspaper of general circulation.

Adopted: 29 Dec. 2009

BY AUTHORITY OF THE BOARD:

(SGD.) MARIA ELENA H. BAUTISTA
Administrator