Regulatory Framework
3.2 Formal Safety Assessment .1 Historical Background
The application of risk analysis techniques is generally well established in most industries, both as a means for the owner/operator to manage their own risks and for the regulator to prioritise work on the development of Rules and Regulations.
Most risk analysis techniques have their origin in the nuclear industry, for which risk analysis became an important tool in the 1960s, and has now developed into a Probabilistic Safety Assessment (PSA), (Freeman and Moir 1993). The focus here is on the probability of releases from nuclear containments. The PSA will be regularly updated, e.g. after upgrades, inspections, maintenance.
In the hazardous chemical industry, risk analysis techniques were adopted in the
’70s. Within the EU and the European extended economic area, risk analysis was
required by the EU Seveso I directive in 1982, which has later been replaced by the Seveso II directive.
In the offshore industry, the use of risk analysis has been required since 1986 in Norway and in the UK since 1992 as a consequence of the Piper Alpha disaster.
The risk analysis is carried out on behalf of the owner of the plant, and has to be well documented. The document is called a Safety Case in the UK, which will be approved by the UK Health and Safety Executive. In Norway the authorities do not approve such documentation or any safety targets, but they are allow insight into the safety related decision making process of the individual enterprise, and act on situations which are not acceptable.
On a generic policy level, most OECD countries require risk analysis as the basis for regulation. For example, already according to the US President Executive Order no. 12866 on ‘Regulatory Planning and Review’ e.g. the US Coast Guard had to base their Rules and Regulation on Risk Analysis and Cost Benefit evaluation.
Finally, it should be noted that both ISO and CEN (Comit´e Europ´een de Nor- malisation/European Committee for Standardization) have their structural standards based on risk assessment, and the use of Structural Reliability Analysis.
In the shipping industry, most of the statutory regulations in the past have been developed as a reaction to major accidents and disasters. In 1992, the UK House of Lords Select Committee on Science and Technology recommended a Safety Case Regime for shipping, similar to that already adopted in the oil and gas industries. It also recommended a move towards performance standards in place of prescriptive rules (indicating that GBS was predicted – see below) and a concentration on the management of safety.
In 1993, during the 62nd session of the IMO Maritime Safety Committee (MSC), the UK Maritime and Coastguard Agency (MCA) (MSA at that time) proposed a standard five step risk based approach, which was called Formal Safety Assessment (FSA). In 1996 the IMO established a working group on FSA, and by 1997 a Cir- cular on Interim Guidelines on the Application of FSA to the IMO Rule-making Process (IMO 1997) had been developed, which was adopted by the MSC and the Maritime Environmental Protection Committee (MEPC) in the same year. Since then, a number of FSA studies have been carried out and presented to the IMO.
At MSC80, the FSA Guidelines were updated the second time. The last version is available (IMO 2007) now including such elements as risk evaluation criteria and an agreed process for reviewing FSAs.
3.2.2 Purpose of FSA
Formal Safety Assessment (FSA) is a structured and systematic methodology, aimed at enhancing maritime safety, including protection of life, health, the marine envi- ronment and property, by using risk analysis and cost benefit assessment.
FSA can be used as a tool to help in the evaluation of new regulations for mar- itime safety and protection of the marine environment or in making a comparison
between existing and possibly improved regulations, with a view to achieving a balance between the various technical and operational issues, including the hu- man element, and between maritime safety or protection of the marine environment and costs.
FSA is consistent with the current IMO decision-making process and provides a basis for making decisions in accordance with resolutions A.500(XII) ‘Objectives of the Organization in the 1980s’, A.777(18) ‘Work methods and organization of work in committees and their subsidiary bodies’ and A.900(21) ‘Objectives of the Organization in the 2000s’.
The decision makers at IMO, through FSA, are able to appreciate the effect of proposed regulatory changes in terms of benefits (e.g. expected reduction of lives lost or of reduced pollution) and related costs incurred for the industry as a whole and for individual parties affected by the decision.
FSA should facilitate the development of regulatory changes equitable to the various parties thus aiding the achievement of consensus.
3.2.3 Application-General
In the FSA Guidelines it is stated that the FSA methodology can be applied by:
• a Member Government or an organization in consultative status with IMO, when proposing amendments to maritime safety, pollution prevention and response- related IMO instruments in order to analyse the implications of such proposals; or
• a Committee, or an instructed subsidiary body, to provide a balanced view of a framework of regulations, so as to identify priorities and areas of concern and to analyse the benefits and implications of proposed changes.
In practice, option 2 has proven unrealistic. It takes a project to run an FSA. This implies that option 1 has always been followed, with some intermediate reports to IMO. Usually a new project informs IMO by submitting the HazId Report (Step 1 of FSA). The full FSA Report may follow one or two committee meeting later.
It is not intended that FSA should be applied in all circumstances, but its ap- plication would be particularly relevant to proposals which may have far-reaching implications in terms of either costs (to society or the maritime industry), or the legislative and administrative burdens which may result. However, if a Goal Based Standard (GBS) is implemented, FSA may be made mandatory under agreed con- ditions at a later stage. This has been proposed, but so far not discussed in detail at IMO.
FSA may also be useful in those situations where there is a need for risk reduc- tion but the required decisions regarding what to do are unclear, regardless of the scope of the project. In these circumstances, FSA will enable the benefits of pro- posed changes to be properly established, so as to give IMO Member Governments a clearer perception of the scope of the proposals and an improved basis on which they take decisions.