The US Coast Guard issued a policy letter providing guidance on Subchapter M third party organizations (TPOs) under the Towing Safety Management.
Vessel operators have the choice of two inspection regimes. Under the Towing Safety Management System (TSMS) option, routine surveys and audits are primarily performed by a TPO, including certain classification societies, with limited oversight and audits by the Coast Guard. Alternatively, under the Coast Guard inspection option, all inspections are conducted by the Coast Guard.
As part of the TSMS option, the company management undergoes an audit while vessels enrolled in an external survey program or internal survey program receive a survey or audit respectively. TPOs provide the necessary oversight, on behalf of the Coast Guard, to ensure vessel owners and managing operators as well as their vessels have systems in place to meet the requirement in 46 CFR Subchapter M.
Further details may be found by reading USCG policy letter