A Simpler Approach to Regulatory Compliance

By Philipp Lohrmann

(Editor’s Note: Philipp Lohrmann, Research Scientist at BMT Group and Project Manager of e-Compliance, a new three-year EU project aimed at improving efficiency within the maritime regulatory regime, highlights the challenges and provides a comprehensive view of what is required to help reduce the administrative burden for stakeholders. He further explains why creating a model for managing regulations digitally may revolutionize the currently fragmented field of regulatory compliance. The e-Compliance project consists of 10 partners, all of whom bring their specific areas of expertise to bear. They include BMT Group Ltd, Det Norske Veritas (DNV), Danaos Shipping Co Ltd, INLECOM Systems, The Netherlands Organization for Applied Scientific Research (TNO), TEMIS, Acciona Infraestructuras, PORTIC Barcelona, Norsk Marinteknisk Forskningsinstitutt AS (MARINTEK), and the Maritime Administration of Latvia.) 

A modern ship’s bridge is packed with bleeping, blinking, state-of-the-art technology to help steer her clear of danger, but there is little more to help avoid treacherous legal issues than there was a century ago. What they have is the legal equivalent of a plumb line, chronometer and sextant.

Relying on such antiquated legal tools means merchant vessels are forever at the mercy of ever-changing regulations, often murky, and potentially costly or even ruinous. Regulations change from one vessel to another, from place to place, and sometimes even from one day to the next. Regulations applying to a particular vessel generally depend on the date a ship was built, not the date shown on the calendar. Any oversight or error could lead to costly delays or even detentions. Is it any wonder, then, that senior seafarers complain about compliance paperwork taking up to 80 percent of their time – time that could be spent dealing with more immediate matters like safety and navigation?

The effort to remedy this situation has led to a number of new approaches – one of which is e-Compliance, a new three-year European Commission-funded research project that will help improve efficiency. But it is not just administratively overburdened ship masters and ship agents who stand to benefit. The e-Compliance project is designed to benefit all stakeholders in maritime law, whether their responsibility is to create, enforce or obey it.

Navigating Through the Fog

The project, involving ten organizations from seven EU countries, is being coordinated by UK-based BMT Group Ltd., a leading international design, engineering and risk management consultancy. It will include development of a system that provides a digital library of maritime regulations, enhanced to allow users to more easily reference definitions and their meaning. 

Using the e-Compliance system, a supranational organization would be able to ensure consistency when drafting new maritime regulations. Currently, the same term can often refer to various things in different regulatory regimes. The e-Compliance system will ensure the same term is used to denote the same thing in new regulatory documents. A user affected by the new regulation, meanwhile, such as a ship operator or port, would be able to look up the definitions of a term and search for related regulations referring to the same term or its synonyms.

Those drawing up local port by-laws might also look to compare their efforts to international regulations, something which is currently difficult to do. Again, the same term is often used to denote different things while different terms are used to denote the same thing. Thus it is hard to find overlaps and gaps in the maze of existing regulations. At the heart of this approach lies the concept of an ontology or repository that is a structured and, to some extent, computer-readable model of the maritime regulations domain. A consistent use of terms and definitions is then enforced by mapping new draft regulations to this structure.

The e-Compliance system will also enable a port to publish regulations and report templates in a machine-readable format. Such documents could be picked up by the e-Compliance system and specifically tailored to the needs of a ship, automatically initiating the reporting and compliance-checking process when required. This would be straightforward in some cases – for example, when extracting a ship’s “static” data such as its identity number, name and tonnage.

Connecting the makers of the law to those who need to enforce or obey it through an electronic system means those required to uphold a regulation must know of any changes. The same goes for International Safety Management code companies. Providing updates on regulatory changes, which are filtered by relevance (for example, ship or cargo types and geographic regions), will help practitioners update their processes and internal procedures to ensure compliance.

Port inspectors would also see benefits. Certificates could be issued with scannable "QR" mobile device codes. Using such codes, a paper certificate’s validity could be readily checked using a handheld device (like a smartphone), which deciphers the QR code and allows the user to compare the stored details to the information on the certificate. Such a “digital signature” will simplify and speed up the validation process for onboard certificates.

Local by-laws and all mandatory reporting requirements vary widely. The e-Compliance system will allow ship agents to formulate computer-readable “rules” that contain the requirements of the by-laws. These rules can then be exported to the ship's “Rules Engine,” which can alert the captain and crew if any of the requirements are not met.

Another approach is to utilize historical data on vessel movements and actions in a certain area (like a port). When a vessel then approaches this port, its behavior can be compared to the behavior of similar vessels on similar journeys. Any discrepancies would be detected, warning the crew of possible instances of non-compliance. In addition, the e-Compliance system can reduce paperwork by sharing reporting information when ports require it to be transferred in advance from the port the vessel last left.

Making the Laws

Those drafting regulations also have much to gain. As noted, regulations can be drafted by different entities with little cooperation. By offering a way to create regulations digitally, e-Compliance could allow them to synchronize their efforts. This would improve the quality of regulations and, in time, reduce the burden put on those having to enforce and comply with them.

Currently, a captain may be a faultless seafarer able to navigate the most challenging routes in seemingly impossible conditions only to dock in a small European port and be confounded by paperwork. Such ports would benefit from having the tools they need to make their facility more welcoming to trade. 

Any efficiency improvements the project can deliver would also offer benefits for the EU economy as a whole, where ships transport 90 percent of external trade and 40 percent of internal trade. More broadly, the project fits into the EU’s “Integrated Maritime Policy,” which aims to help meet the rising demands of global competitiveness, climate change, the degradation of the marine environment, safety, security and sustainability.

To fulfill the EU's aim of continuing to be a world economic power by offering a single open market for trade, seafarers need technology to help them reliably navigate legal obstacles as well as physical ones. The e-Compliance project could show the way. – MarEx