Decree No. 111/2016/ND-CP dated July 01, 2016 of the Government on prescribing business conditions for provision of seagoing ship building, conversion and repair services

DECREE

Prescribing business conditions for provision of seagoing ship building, conversion and repair services[1]

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

Pursuant to the November 25, 2015 Maritime Code of Vietnam;

Pursuant to the November 26, 2014 Law on Investment;

At the proposal of the Minister of Transport,

The Government promulgates the Decree prescribing business conditions for provision of seagoing ship building, conversion and repair services.

Chapter I

GENERAL PROVISIONS

Article 1.Scope of regulation

This Decree prescribes business conditions for provision of seagoing ship building, conversion and repair services, except building, conversion and repair of seagoing ships only for national defense and security purposes and building, conversion and repair of fishing ships only.

Article 2.Subjects of application

This Decree applies to organizations and individuals involved in the provision of seagoing ship building, conversion and repair services in Vietnam.

Article 3.Interpretation of terms

In this Decree, the terms below are construed as follows:

1. Grade-1 shipyard is an establishment that is capable of building and converting seagoing ships of all types.

2. Grade-2 shipyard is an establishment that is capable of building and converting passenger seagoing ships of a capacity of under 100 passengers; and non-passenger seagoing ships of a designed length of under 90 m, except oil tankers of a gross tonnage of 1,000 GT or more, bulk carriers of dangerous chemicals and bulk carriers of liquefied gas.

3. Ship building is the process of manufacturing a seagoing ship from the time of laying the ship’s keel to the time of handing over the ship for operation.

4. Ship conversion is the modification of one of the following specifications of a ship:

a/ Major dimensions;

b/ Utilities;

c/ Compartmentation within the ship’s hull;

d/ Cargo hold volume;

dd/ Passenger area.

5. Ship repair is an activity to repair and restore a seagoing ship on a slipway, in a dry dock or in a repair place after the ship is lifted above the water surface.

Article 4.General conditions

1. Seagoing ship building, conversion and repair establishments must be enterprises established and operating in accordance with law.

2. Seagoing ship building, conversion and repair establishments must satisfy the conditions prescribed in this Decree and other relevant regulations.

Chapter II

BUSINESS CONDITIONS FOR PROVISION OF SEAGOING SHIP BUILDING AND CONVERSION SERVICES

Article 5.Conditions on technical and quality inspection workers and shipbuilders

1. A shipyard must have a technical division and a quality inspection division which are separate from each other and meet the requirements on seagoing ship building and conversion; each division must have the minimum number of workers prescribed below:

a/ For a grade-1 shipyard: 4 workers possessing a university degree in shipbuilding, 4 workers possessing a university degree in ship engine, and 2 workers possessing a university degree in ship electricity;

b/ For a grade-2 shipyard: 2 workers possessing a university degree in shipbuilding, 2 workers possessing a university degree in ship engine, and 1 worker possessing a university degree in ship electricity.

2. A technical or quality inspection worker must have at least 24 months’ experience in seagoing ship building, conversion or repair.

3. A shipyard that builds metal-hulled ships must have at least 5 metal welders, 2 mechanics, 3 electricians and 3 painters as required by the national technical regulation applicable to seagoing ship building and repair establishments. A metal welder must possess an appropriate professional certificate as required by the national technical regulation on classification and building of seagoing ships or the equivalent.

4. A shipyard that build non-metal-hulled ships must have at least 3 shell manufacturers, 1 mechanic, 1 electrician and 2 painters as required by the national technical regulation applicable to seagoing ship building and repair establishments.

Article 6.Conditions on physical foundations and equipment

A seagoing ship building and conversion establishment must have adequate physical foundations and equipment necessary and appropriate as required by the national technical regulation applicable to seagoing ship building and repair establishments.

Article 7.Conditions on occupational safety and health and fire and explosion prevention and fighting

1. A seagoing ship building and conversion establishment must have sufficient workers and a plan to ensure occupational safety and health as prescribed in the Government’s Decree No. 39/2016/ND-CP of May 15, 2016, detailing a number of articles of the Law on Occupational Safety and Health, and the Government’s Decree No. 37/2016/ND-CP of May 15, 2016, detailing and guiding the implementation of a number of articles of the Law on Occupational Safety and Health regarding compulsory insurance for occupational accidents and diseases.

2. A seagoing ship building and conversion establishment must fully meet the conditions on fire prevention and fighting safety and have a firefighting plan as prescribed in the Government’s Decree No. 79/2014/ND-CP of July 31, 2014, detailing a number of articles of the Law on Fire Prevention and Fighting and the Law Amending and Supplementing a Number of Articles of the Law on Fire Prevention and Fighting.

Article 8.Conditions on environmental protection

1. A seagoing ship building and conversion establishment must have adequate facilities for receiving and collecting wastes from ships for disposal under the International Convention for the Prevention of Pollution from Seagoing ships (MARPOL) to which Vietnam is a contracting party.

2. A seagoing ship building and conversion establishment must have sufficient environmental protection files approved by competent authorities under the Law on Environmental Protection and the Government’s Decree No. 18/2015/ND-CP of February 14, 2015, on environmental protection master plan, strategic environmental assessment, environmental impact assessment and environmental protection plan.

3. A seagoing ship building and conversion establishment must have sufficient workers as well as systems, facilities and equipment for management and disposal of wastes discharged from the establishment as prescribed in Article 68 of the Law on Environmental Protection.

Article 9.Conditions on quality management systems

1. A grade-1 shipyard must establish, and maintain the application of, a quality management system according to ISO 9001 or equivalent standard and a safety and environment management system according to ISO 14001 or equivalent standard.

2. A grade-2 shipyard must establish processes for performing seagoing ship building and conversion tasks in conformity with the national technical regulation on classification and building of seagoing ships.

Chapter III

BUSINESS CONDITIONS FOR PROVISION OF SEAGOING SHIP REPAIR SERVICES

Article 10.Conditions on technical and quality inspection workers and ship repairers

1. A seagoing ship repair establishment must have a technical division and a quality inspection division which are separate from each other and meet the requirements on seagoing ship repair; each division must have at least 1 worker possessing a  university degree in shipbuilding, 1 worker possessing a university degree in ship engine, and 1 worker possessing an intermediate or collegial degree in ship electricity.

2. A technical or quality inspection worker must have at least 12 months’ experience in seagoing ship building, conversion or repair.

3. An establishment that repairs metal-hulled ships must have at least 3 metal welders, 1 mechanic, 1 electrician and 2 painters as required by the national technical regulation applicable to seagoing ship building and repair establishments. A metal welder must possess an appropriate professional certificate as required by the national technical regulation on classification and building of seagoing ships or the equivalent.

4. An establishment that repairs non-metal-hulled ships must have at least 2 shell manufacturers, 1 mechanic, 1 electrician and 1 painter as required by the national technical regulation applicable to seagoing ship building and repair establishments.

Article 11.Conditions on physical foundations and equipment

A seagoing ship repair establishment must have adequate physical foundations and equipment necessary and appropriate as prescribed by the national technical regulation applicable to seagoing ship building and repair establishments.

Article 12.Conditions on occupational safety and health and fire and explosion prevention and fighting

1. A seagoing ship repair establishment must have sufficient workers and a plan to ensure occupational safety and health as prescribed in the Government’s Decree No. 39/2016/ND-CP of May 15, 2016, detailing a number of articles of the Law on Occupational Safety and Health, and the Government’s Decree No. 37/2016/ND-CP of May 15, 2016, detailing and guiding the implementation of a number of articles of the Law on Occupational Safety and Health regarding compulsory insurance for occupational accidents and diseases.

2. A seagoing ship repair establishment must fully meet the conditions on fire prevention and fighting safety and have a firefighting plan as prescribed in the Government’s Decree No. 79/2014/ND-CP of July 31, 2014, detailing a number of articles of the Law on Fire Prevention and Fighting and the Law Amending and Supplementing a Number of Articles of the Law on Fire Prevention and Fighting.

Article 13.Conditions on environmental protection

1. A seagoing ship repair establishment must have adequate facilities for receiving and collecting wastes from seagoing ships for disposal under the International Convention for the Prevention of Pollution from Seagoing ships (MARPOL) to which Vietnam is a contracting party.

2. A seagoing ship repair establishment must have sufficient environmental protection files approved by competent authorities under the Law on Environmental Protection and the Government’s Decree No. 18/2015/ND-CP of February 14, 2015, on environmental protection master plan, strategic environmental assessment, environmental impact assessment and environmental protection plan.

3. A seagoing ship repair establishment must have sufficient workers as well as systems, facilities and equipment for management and disposal of wastes discharged from the establishment as prescribed in Article 68 of the Law on Environmental Protection.

Article 14.Conditions on quality management systems

A seagoing ship repair establishment must establish processes for performing seagoing ship repair tasks in conformity with the national technical regulation on classification and building of seagoing ships.

Chapter IV

RECOGNITION AND RE-RECOGNITION OF ESTABLISHMENTS TO BE ELIGIBLE FOR SEAGOING SHIP BUILDING, CONVERSION AND REPAIR

Article 15.Competence to recognize and re-recognize establishments to be eligible for seagoing ship building, conversion and repair

The Vietnam Register under the Ministry of Transport shall organize the recognition and re-recognition of establishments to be eligible for seagoing ship building, conversion and repair in accordance with this Decree, and publicly post the list of eligible establishments on its website.

Article 16.Dossier and procedures for recognition or re-recognition of an establishment to be eligible for seagoing ship building, conversion and repair

1. An organization or individual shall submit a dossier directly, by post or otherwise to the Vietnam Register.

2. A dossier for recognition of an establishment to be eligible for seagoing ship building, conversion and repair must comprise:

a/ An application for recognition of an establishment to be eligible for seagoing ship building, conversion and repair, made according to Form No. 01 in the Appendix to this Decree;

b/ A description of necessary physical foundations for manufacturing activities (site plan of the establishment, working office, workshops, warehouses, manufacturing equipment and facilities, and measuring and inspection devices);

c/ A quality manual together with relevant documents and documented processes, including environmental protection, occupational safety and fire and explosion prevention and fighting files approved by competent authorities under law;

d/ A list of technical and quality inspection workers, enclosed with copies of their relevant diplomas and certificates.

3. When the notice of an establishment’s eligibility for seagoing ship building, conversion and repair expires, or when the establishment requests modification or supplementation of the recognized qualified items, a dossier shall be submitted for re-recognition of the establishment to be eligible for seagoing ship building, conversion and repair to the Vietnam Register. The dossier must comprise:

a/ An application for re-recognition of the establishment to be eligible for seagoing ship building, conversion and repair, made according to Form No. 01 in the Appendix to this Decree;

b/ A report on the operation of the establishment since the time it is recognized or re-recognized to be eligible for seagoing ship building, conversion and repair;

c/ The papers mentioned at Points b, c and d, Clause 2 of this Article in case of any change.

4. Procedures for recognition or re-recognition of an establishment to be eligible for seagoing ship building, conversion and repair:

a/ An organization or individual that wishes to have its/his/her establishment recognized or re-recognized to be eligible for seagoing ship building, conversion and repair shall send to the Vietnam Register 1 set of dossier for recognition or re-recognition of an establishment to be eligible for seagoing ship building, conversion and repair, and pay expenses for assessment and appraisal under law;

b/ Within 3 working days after receiving a dossier, if finding that the dossier is invalid, the Vietnam Register shall guide the organization or individual to complete the dossier under this Decree; if the dossier is valid, the Vietnam Register shall, within 5 days after receiving it, give a written reply stating the time for field assessment at the establishment;

c/ The Vietnam Register shall conduct a field assessment at the establishment. If the assessment result shows that the establishment is eligible for seagoing ship building, conversion and repair, the Vietnam Register shall issue a notice of the establishment’s eligibility for seagoing ship building, conversion and repair, made according to Form No. 02 in the Appendix to this Decree, and announce the list of eligible establishments on its website on the working day following the date of completion of the assessment.

If the assessment result shows that the establishment is ineligible for seagoing ship building, conversion and repair, the Vietnam Register shall send to the establishment a written reply clearly stating the reason on the working day following the date of completion of the assessment.

Article 17.Validity period of a notice of an establishment’s eligibility for seagoing ship building, conversion and repair

A notice of an establishment’s eligibility for seagoing ship building, conversion and repair is valid for 5 years from the date of its issuance.

Article 18.Revocation of a notice of an establishment’s eligibility for seagoing ship building, conversion and repair

1. The Vietnam Register shall revoke a notice of an establishment’s eligibility for seagoing ship building, conversion and repair in the following cases:

a/ As requested by the establishment;

b/ The establishment fails to maintain its quality management systems under regulations;

c/ The establishment fails to maintain the conditions prescribed in this Decree during its operation.

2. The Vietnam Register shall send a document revoking the notice of an establishment’s eligibility for seagoing ship building, conversion and repair in the cases mentioned in Clause 1 of this Article to the establishment and remove the establishment’s name from the list of eligible establishments on the website of the Vietnam Register.

Chapter V

ORGANIZATION OF IMPLEMENTATION

Article 19.Implementation responsibility

1. The Ministry of Transport shall:

a/ Uniformly manage the provision of seagoing ship building, conversion and repair services;

b/ Direct the Vietnam Register to organize, guide, and conduct assessment for, the recognition of establishments to be eligible for seagoing ship building, conversion and repair in accordance with this Decree; conduct specialized inspections once every 5 years or irregular inspections to ensure that establishments maintain the conditions prescribed in this Decree; apply information technology in the management, assessment and recognition of establishments to be eligible for seagoing ship building, conversion and repair and management of relevant data; and report on the results of assessment and recognition of establishments to be eligible for seagoing ship building, conversion and repair under regulations;

c/ Conduct inspections and examinations and handle violations of the regulations on, and business conditions for, provision of seagoing ship building, conversion and repair services in accordance with this Decree and other relevant regulations;

d/ Formulate, supplement, amend or issue national technical regulations applicable to seagoing ship building, conversion and repair establishments to suit the shipbuilding technology development levels in the country and the world.

2. The Ministry of Natural Resources and Environment shall assume the prime responsibility for, and coordinate with the Ministry of Transport in, providing specific guidance on plans to prevent and control environmental pollution for seagoing ship building, conversion and repair establishments in accordance with law.

3. The Ministry of Public Security shall assume the prime responsibility for, and coordinate with the Ministry of Transport in, providing specific guidance on plans to prevent and fight fires and explosion for seagoing ship building, conversion and repair establishments in accordance with law.

4. The Ministry of Science and Technology shall assume the prime responsibility for, and coordinate with the Ministry of Transport in, organizing inspection and calibration of measuring and inspection devices in accordance with the law on measurement.

5. Provincial-level People’s Committees shall, based on their functions, tasks and powers, perform the state management of the operation of seagoing ship building, conversion and repair establishments in localities in accordance with law.

6. Seagoing ship building, conversion and repair establishments shall comply with the provisions on business conditions in this Decree and other relevant regulations; and maintain business conditions during their operation.

Article 20.Inspection and examination of business conditions

Seagoing ship building, conversion and repair establishments shall submit to specialized inspection and examination by competent authorities in terms of business conditions and during their operation in accordance with law.

Chapter VI

IMPLEMENTATION PROVISIONS

Article 21.Effect

This Decree takes effect on July 1, 2016.

Article 22.Transitional provision

Seagoing ship building, conversion and repair establishments formed before July 1, 2016, may continue their operation and must fully satisfy the conditions prescribed in this Decree as from July 1, 2019.

Article 23.Organization of implementation

1. The Minister of Transport shall assume the prime responsibility for, and coordinate with related ministries, sectors and provincial-level People’s Committees in, organizing the implementation of this Decree.

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and chairpersons of provincial-level People’s Committees shall implement this Decree.

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC

* The Appendix to this Decree is not translated.-