MEMBER ALERT Shipowners Claims Bureau, Inc., Manager One Battery Park Plaza 31 st Fl., New York, NY 10004 USA Tel: +1 212 847 4500 Fax: +1 212 847 4599 https://www.american-club.com American Club Member Alert – July 11 , 20 2 2 1 JULY 11, 2022 LOSS PREVENTION: SHANGHAI MARITIME SAFETY ADMINISTRATION (MSA) EFFECTS NEW CONTROLS TO REDUCE INCIDENTS OF MACHINERY FAILURE Your Managers have been notified that as of July 1, 2022, the Shanghai MSA has launched an initiative focused on strengthening safety management measures to reduce the incidents of machinery failures. The Notice, Shanghai MSA Notice of Strengthening Safety Management of Ship Mechanical and Electric Equipment Failures can be found in English and new Mandarin. In summary: 1. Tests of both main and auxiliary machinery should be carried out on vessels before they call at the Port of Shanghai. 2. In cases of machinery failures, vessel masters should take emergency measures to ensure the vessel’s safety and avoid accidents. If machinery failures occur, a written report is to be submitted to the local MSA with details of the incident, emergency measures and corrective actions, as well as vessel information on the owner, management, agent and classification. 3. Any vessels that experience a machinery failure in Shanghai's territorial waterways, such that the incident may cause risk to traffic safety or repairs may take more than two (2) hours, will require an onboard incident root cause investigation and safety inspection by the port State inspection authorities. 4. Vessels with two or more machinery failure incidents within a twelve (12) month period in Shanghai waters will be listed as “high risk” by the Shanghai MSA. Those vessels will also be subject to additional measures, which may include detention, suspension, or removal from port. Designated vessels must also report their precautionary actions for testing machinery to vessel traffic services (VTS) and local MSA, with video of the test and the master's attendant declaration. Alternatively, a designated ship can employ an additional tug for the voyage through the Yangtze River. An owner, manager or operator with three or more machinery failures and total times over 10% of the vessel numbers they own or operate, will also be designated. Those listed face action from the Shanghai MSA, which includes downgrading governmental service and vessel traffic priority as well as informing their banking and insurance providers. The new requirements are deemed to stay in effect for two (2) years. Recommendations Members affected by these new requirements should ensure that: MEMBER ALERT Shipowners Claims Bureau, Inc., Manager One Battery Park Plaza 31 st Fl., New York, NY 10004 USA Tel: +1 212 847 4500 Fax: +1 212 847 4599 https://www.american-club.com American Club Member Alert – July 11 , 20 2 2 2 • Both main and auxiliary machinery systems are in good working order. That includes propulsion, auxiliary engine, steering systems and navigational equipment in accordance with the vessel’s pre-arrival check lists as per the safety management system requirements. • All crew members are familiar with their normal duties and emergency response measures to be taken in the event of a machinery failure. • The vessel’s safety management system properly considers risks associated with machinery failures that may include, but not limited to main engine loss of control, loss of power, blackout, emergency steering and emergency generator operations. •