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556                                                      Part V Risk Assessment


                 The following Sections in this Chapter deal with the FSA. The major fhctional components
                 of FSA are outlined, and followed by a detailed description of each component. A case study
                 in the FSA regime is then briefly presented for illustrative purpose. The inclusion of human
                 and organizational factors within FSA is also discussed. Finally, the challenges, limitations,
                 and concerns regarding FSA application in shipping industry are discussed.

                 31.2  Overview of Formal Safety Assessment

                 As a risk based methodology, in some aspects FSA is similar to the Safety Case regime used
                 in  the  UK  Continental  Shelf.  A  safety  case  should  be  applied  to  a  particular  offshore
                 installation. However, FSA is applied as a whole to shipping or to safety issues common to a
                 ship type, such as tankers or high-speed passenger vessels. This type of application is due to a
                 number of reasons, for example, the unique feature of the shipping industry: there is no single
                 regulator, no single culture, and no uniformed education & qualification system existing in
                 maritime industry worldwide. FSA is a tool for rule-making at IMO to make decision process
                 more  rational  and  to  provide  a  proactive  approach  comprising technical and  operational
                 aspects.  IMO interim FSA Guidelines state that “FSA can be used as a tool to help in the
                 evaluation of new safety regulations of 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 human element, and between safety and costs”. The FSA may
                 be  used  to  develop  “performance-based”  rules  stating  safety  objectives  and  functional
                 requirements and rational “prescriptive standards” based on the performance-based rules.
                 The main characteristics of the Formal Safety Assessment are presented below:
                    A systematic approach considering the ships as socio-technical systems. The system may
                    consist of hardware, environment, human organizations, operations, and procedures.
                    Hazards  are  identified proactively through  the  hazard  identification process.  A  large
                    number of different hazard identification approaches may be put into use.
                    Risks associated with various hazards are described and analyzed. The risk is a composite
                    of the  likelihood and  consequences of the  potential undesirable events arising from  a
                    hazard.  The risk  analysis covers a certain time-span,  i.e.  the operational life, and may
                    involve various quantitative or qualitative tools to perform  likelihood and consequence
                    calculations.
                    Once a risk is quantified, it is then necessary to determine if the risk is acceptable, based
                    on the predefined acceptance criteria. When the risk is acceptable, a costhenefit analysis
                    may be followed to compare the costs for preventive/protective measures with the benefits.
                    The above mentioned basic elements are integrated into a risk model, where the objective
                    is  to  recommend the  most  cost effective, preventive, and  mitigating measures for risk
                    management.
                 The fiinctional components in a Formal Safety Assessment are shown in Figure 31.1 below.
                 Being  a  risk  based  approach it  may  look  quite  similar to  the  offshore QRA procedures.
                 However, the  actual content  of  each step  as well  as the  methods and tools  used  may be
                 different from offshore applications. This is described in more detail in Section 3 1.3.
                 The types of risks to be considered include:
                    risk to human safety
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