ML19296C140

Discusses Response to Commission Question Re Protection of SNM

ML19296C140
Person / Time
Issue date:	01/05/1978
From:	Minogue R NRC OFFICE OF STANDARDS DEVELOPMENT
To:
Shared Package
ML19296C119	List: ML19296C118 ML19296C134 ML19296C140 ML19296C143 ML19296C146 ML19296C151 ML19296C153
References
REF-10CFR9.7 SECY-78-008, SECY-78-8, NUDOCS 8002250269
Download: ML19296C140 (37)

Text

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The Commissioners Pem: Recer

3. Minogue, Director Office of Standarcs Develecment Executive Director for Ccerationp [

Thru: Suoject: RESPCNSE TO THE C::MMISSION QUESTION CCNCERNING THE PROTECTICE. OF STRATEGIC SPECIAL NUCLEAR MATERIAL (SSNM) SHI?MENTS Purcose: To analy:e alternative acproaches to bring domestic carriers, who transport SSNM in quantities specified in 10 CFR 73, more directly under NRC physical protection requirements. Catecorv: This paper covers a major policy matter. Issue: Whether 10 CFR 70.12 should be amended to remcve the exemotion of carriers frem the NRC pnysical protaction recuirements or usa scme other method to bring dcmestic carriers more directly under NRC requirements. Cecision Celteria: 1. The alternative should provide a legal basis fsr NRC authority ta inscect ccmestic snigments of strategic quantities of SNM c::mmensurate with that new provided for NRC inspection of fixec sita facilities. 2. The altarnative saculd not diminish or limit c::mcecitive interest in the transcort market of SSNM. 3. The alternative should result i, a reasonaole c::st imcact on the NRC, licensees and dcmestic transecrt activities, (e.g., carriers, freign forwarders, warencusemen and shipoers' agents), in consideration of tne risks involved and the benefits derived. 1 The alternative should result in minimal interference with other goverr. ment agencies that regulata domestic transcorta tion ac-ivities. Altarnatives: 4. T'1e Commission may elect to continue with the cresent system whicn previces 'cr minimal requiation of ccmestic transport activities, enereoy NRC ins::ection functions are performed on a ccccerative arrangement wita carriers, unc permit the NRC to inscect snipments.

Contact:

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The Commissioners 2 B. The Commission may elect a system of incirect regulation wnerecy the Commission's regulations would be amenced to require licensees to enter into a specific contract witn the carrier to allow the NRC to carry out its inspection functions. C. The Commission may elect a system of direct regulation wherecy 10 CFR 70.12 would be amended to eliminate the exemption for carriers who transcort SNM which is subject to the requirements of 10 CFR 73 and place carriers directly under NRC inspection requirements by issuing carriers a general license to possess SSNM subject to specific pro-visions regarding physical protection. D. The Commission may elect a system of direct regulation and control over carriers who transport SNM which is suoject to the requirements of 10 CFG 73 wnereby 10 CFR 70.12 wou!d be amended as in C acove, and each carrier would be required to file an acplication for a specific license to possess $$hM. Discussion: The subject of whether domestic transcortation activities should be subject to additional security recuirements, either through ~ licensing or scme other method was raised in connection with SECY 75-463 during Policy Session 75-48 on August 29, 1975. In a memorandum of September 3, 1975,'the Commission rectestad the Executive Director for Operations to reconsider SECY 75-463 in light of tne acove. In resconse to this request, SECY 76-532 dated November 2,1976, recommenced actions for resolving, among other things, the matter concerning additional security measures for comestic transportation activities. After duly considering the recem-mendations made in SECY 75-532, tne Commission, by memorandtm to the Executive Director for Cperations dated March 7,1977, directed the staff to prepare among other things, an analysis of alternative approaches to amending 10 CFR 70.12 to bring carriers directly under NRC physical protection requirements. The Commission also directed the staff to prepare views on the preferred option. BACXGRCUND: Domestic shipments of 55NM means the transport of 55hM witnin the United States or its possessions in cuantities specified in and subject to the requirements of 10 CFR 73, " Physical Protection of Plants anc Materials." SSNM shipments include the transport of 53NM: (a) between U.S. licensee facil-ities; (b) frcm a licensee shiccer to the first port of call in a foreign country for export shipments; and (c) frem the first

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The Commissioners 3 point of unloading in the United States to the receiving licensee facility for imcort shipments. Currently, there are apcroximately fifteen (15) export / import related commercial domestic shipments of SSNM being made per year. Althougn existing NRC regulations authoriza commercial domestic snigments of all types of SSNM by sea and rail and certain types by air cargo, the shipments are currently being made primarily by road. At the present time, one (1) carrier and two (2) shippers' agents have an NRC appraved transportation security plan which cover road shipments, and there are no NRC approved security plans for freight forwarders or warehousemen. Up to now, freignt frrwarcers and warehousemen have essentially not ceen involved in the transport of strategic quantities of special nuclear materials and it is anticipated that, without plutonium recycle, tne situation will probably not cnange. Item 2 of tne Secretary of the Ccmmission's memorandum of March 7,1977, explicitly requested that staff explore alter-native means for bringing carriers directly under NRC regula-tions. However, staff beifeves that other persons involved in the domestic transport of SSNM (e.g., freight forwarders, ware-housemen and shippers' agents) wno may, for varying periods of time, acquire physical possession of SSNM which is subject to the requirements of 10 CFR 73, but who are exempt from doing so by 10 CFR 70.12, shoulc also be considored in this paper. With regard to shipcers' agents, SECY 76-532, stated that the com-pulsory licensing of shipcers' agents is not supportable because their protection' activities did not fall witnin the scope of Section 52a. of the Atomic Energy Act of 1954, as amended, i.e., they did not possess (strategic) special nuclear material, and that an appropriate acproach would be an indirect regulation through a contractual arrangement between the shipper licensee and the shipper's agent. Subsequent to this conclusion and recommendation, it has been established througn recent transportatien activity that snippers' agents can and do at times possess SSNM within the meaning of Section 53a., and that a compulusory license require-ment for shippers would be supportable. In Octcher of 1977, an NRC licensee contracted with a shipper's agent to arrange to transport on nis oehalf, SSNM wnica was subject to the pnysical protection -equirements of 10 CFR 73. 7he agent arranged for the transp.rt and protection of the SSNM shi: ment including the hiring of.arrier : and escort guards. A memcer of management from the agent' arganization accompanied the saicment and exercised acnol over the movement of the material, and tne activities cf.:e protective forces. In this instance prior ,f f,,.. m e

The Commissioners 4 to the shipment being made, tne shipper's agent would not agree to permit Inspection and Enforcement to perform certain insoec-tion functions on the shipment. Because of this, a special license condition was imposed on the shiocer licansee the day before the shipment was made to allow I&E inspection of the shipment. Under the present regulations, the agent who had actual possession of the material was not subject to NRC regu-lations during the course of the shipment (neither were the carriers or the escort guards). It is expected that instances similar to this one will occur in the future. There may also be instances where a person other than a shipper's agent or a carrier would possess SSNM during transport without being sub-ject to NRC requirements. Therefore, in the interest of pro-viding a uniform level of regulation of $5NM throughout the nuclear fuel cycle, ard since thr. alternatives and the arguments both pro and con presanted he%.n aculd acply to carriers, freight forwarders, warehousen.cn, saippers' agents and any other person who would possess SSNM in the course of a shipment, staff believes that the Commission should consider imposing concomi-tant and equivalent requirements on any person to possess or control SSNM for the purpose of transport or storage incicent thereto. Staff has appended an Enclosure 5 to this paper wniah sets forth the croposed changes to the regulations that would ce necessary, should the Commission approve Alternative C, to require issuance of a general license applicaole to persons who possess $5NM of the types and in the cuantities subject to the requirements of 10 CFR 73, for the purpose of transport or storage incident thereto. Such a requirement would provide the NRC a legal Dasis for regulating the transport of 55NM compa-rable to that already provided for the regulation of fixec sita fuel cycle facilities. The approaches for considering bringing carriers under more direct NRC pnysical protection control with resoect to transpor-tation of strategic special nuclear material are independent from the safety aspects. There are certain studies ongoing with respect to safety in the transportation of radioactive materials, sucn as the environmental impact statement on Transcortation of Radioactive Materiale by Air and Other Maces, the environmental impact statement c ansportation of Radioactive Material Througn Urcan Enviro.<nents and a study on ways to improve (frca a safety standcoint) transportation of low level radioactive materiais. There is no indication at the present time that any of these safety studies would result in a conclusion that NRC snould exercise direct regulatory control over carriers for safety purposes. If any additional requirements snould be considerec necessary for carriers as a result of these stucies, N g,,. o s-46

The Commissioners 5 the present plan is to imolement such recuirements through the 00T regulations, rather tnan NRC regulations. This would be consistent witn the memorandum of understanding with 00T whereby NRC is responsible for packaging requirements and COT is responsi-ble for carrier requirements with respect to safety in transporta-tion. Only if DOT refused to impose additional carrier require-ments wnich NRC felt were necessary would we consider using NRC authority to impose safety requirements directly on carriers. The alternative approaches for bringing transport activities more directly under NRC physical protection requirements which would not interfere with other Federal Agencies regulation of transportation activitias are presented and evaluated in the following paragraphs: Alternative A. The Commission may elect to continue the present system wnereoy NRC transportation inspection functions are carried out under a voluntary arrangement with carriers and shippers' agents. (See Enclosure 1). Pro: (1) This practica until recently has been acceptable. (2) For a carrier or shipper's. agent who is found to be in non-compliance with NRC requirements, the NRC can either revoke accroval of that comoany's security plan or prohibit a licensee's use of that carrier or ship-per's agent, wnere the licensee approved security plan was being followed. (3) No cost impact on the licensee, carrier, shipper's agent, or the NRC would result frem continuation of Alternative A. Con: (1) The NRC has no clear legal basis for inspecting trans-port security systems in the absence of a carrier's or shipper's agent's permission to inspect. (2) Although the shipper licensee does not pcssess or exercise control over the SSNM he is required to protect while in transit, he is responsible for the protection of the raterial while it is in the pos-session or under the control of another person. (3) The NRC has no clear legal basis in the absence of a license to impose fines or penalties directly against a transport activity found to be in non-c:moiiance with NRC requirements, or tne approved transcortation security plan. [ e s *

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The Commissioners 6 Alternative 3. The Commission may elect a system of indirect regulation wnereoy the Commission's regulations wculd be amended to require shicper licensees to enter into a specific contract with a transport activity to allow the NRC to carry out its inspection functions. (See Enclosure 2.) Pro: (1) A specific contract would bring transportation activi-ties indirectly under NRC physical protection inspec-tion requirements. (2) The shipper licensee, by express condition of his contract, would provide NRC the legal authority nec-essary for access to inspect a transcort activity security system for each shipment, including his records, and the communications systems used. (3) The present system foi submitting a transport activity security plan for NRC approval could continue to ce used and non-compliance of an item by the activity could result in NRC revocation of approval of his plan, or automatic revocation could ensue as a specific condition of a licensee contract with a carrier or shipper's agent. (4) The shipper licensee would by exoress condition of the contract have legal recourse for non-compliance or lack of cerformance in meeting NRC requirements on tne part of a transport activity through a civil action at law. (5) Should not diminish or limit competitive interest in the transport market of SSNM. Con: (1) NRC regulatory control is indirect, through the licensee contract for transport. (2) The NRC has no clear legal basis, in the absence of a license to impose fines or penalties against a trans-cort activity found to ce in non-compliance with NRC requirements. (3) While the shipper licensee does not retain physical control over the 55NM, he is responsible for pro-taction of the material during tne period of time the transport activity has possession. (4) Requires amendment to 10 C.:R 70 wnerein tne NRC woulc provide detailed guidance to transport activities to ., n ~.,:,. 1

The Commissioners 7 assure that specific terms ano conditions wnich would retain NRC authority to inspect, are incorporated into the scecific contract for transport. (5) Would require NRC review and acproval of each shipper licensee's contract for transport. (6) Would involve some cost impact on the shipper licensce and One NRC, and minimal, if any, on the transport activity. Alternative C. The Commission may elect a system of direct regulation wnereby 10 CFR 70.12 would be amenced to delete the transport activity exemption when carrying the types and quanti-ties of SSNM subject to physical protection curing transporta-tion under 10 CFR 73 and place transoort activities directly under NRC physical protection requirements by issuance of a general license to possess SSNM. (See Enclosure 3.) Pro: (1) The NRC would exercisa direct regulatory authority over transport activities. (2) The NRC would have a clear legal basis for inspecting transportation security systems. (3) The NRC would have the legal authority to imcose fines and/or penalties on transport activities for non-compliance wita NRC pnysical protection requirements. (4) The general license would set forth specific provisions and conditions for retention o' certain NRC authority (i.e., to inspect, to require documentation and records, to require reports, to confiscata material, etc. ). (5) Would be effective without the filing of applications with the Commission or the issuing of licensing docu-ments to particular persons. (6) Would involve no cost impact on the shipper licensee, and minimal on the transportation activities, and the NRC. (7) The resconsibility for assuring protection of SSNM in transit would be placed directiy on the transport activity.

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The Commissioners S Con: (1) Could diminish the interest of other transport activi-ties that would otherwise enter the SSNM transcort market. (2) Would require a person who possesses 55NM to submit for NRC approval a copy of his security plan which describes the security system he will use and the procedures he will follcw to protect SSNM in his pos-session during transport. Alternative D. The Commission may elect a system of direct regulation and control over transcort activities wnereby 10 CFR 70.12 would be amended as in Alternative C above, and each transcort activity would be recuired to apoly for a spe-cific license to possess. (See Enclosure A.) Pro: (1) The NRC would have a legal basis for exercising direct regulatory authority over transport activities. (2) The NRC would have a clear legal basis for inspecting transport security systems and to imcose fines or penalties for acn-compliance with NRC requirements. (3) Would olace the rescensibility for assuring protection of SSNM in transit directly on the transport activity during the period of time.that he possesses $5NM. (A) Transcort activities would be bound to comply with all the provisions and conditions of a specific license. (5) Would result in no additional cost to the shipper licensee. (6) Would give the NRC the authority to screen transport activity applicants to cetermine their pualifications and cacabilities resulting in NRC approval anc licens-ing of certain transport activities. Con: (1) Would require transport activities to file an acplica-tion for a specific license. (2) Would result in the issuance of licensing doct.ments to particular persons. w ~-u A

The Commissioners 9 (3) Would result in moderate additional cost to transport activities and to tne NRC. Could result in significant cost itcact to tne NRC in the future with the axcan-sion of tne nuclear fuel cycle. (4) Would diminish or limit competitive interest in the transport market of 55NM. Rec 0mmendation: That the Commission: 1. Acorove publication for puolic comment the amendments to 10 CFR Part 70 as set forth in Enclosure 5 (Alternative C). wnich would require the issuance of a general license to possess to any person wne possesses SSNM subject to the requirements of 10 CFR 73 for tne purpose of transport. 2. Note: (a) that the acpropriate congressional C0mmittees will be notified of this Ccmmission action. (b) that an Environmental Impact Statement need not be prepared on subsequent associated rule-making action since the actions to be taken are essentially proce-dural in nature and will not have a significant envi-conmental impact. (c) That a puolic announcement of the amencment is attached. The Office of Puolic Affairs nas prepared the announcement. Coordination: The Executive Legal Director has no legal cojection.

Mcwever, he points out tnat "(1), one instance of a recalcitrant snio-per's agent does not necessarily estaclisn a pattern of non-cocperation for the future and even in the cited instance, NRC authority was exercised througn the licensee shipper; anc (2),

the recommended general license closely resemoles a specific license since under the proposal the general licensee could not actually exercise rights under the license until his transcortation security plan had been reviewed and approved by NRC."* The Offices of Nuclear Material Safety and Safeguards, There is crecedent for tnis level of detail in a recuirement for a general license as exhibited in the proposed amencments to 10 CFR 70 for possession and use of plutonium-238 pcwereo cardiac pacemakers. i::,... n o i-

The Commissioners 10 Inscection and Enicrcement and ?uclic Aff airs have con-curred in the recommencations of :nis pacer. ihe Cffice of Policy Evaluation c:mments have :een reviewed and acpropriately responced to. The sec0nd paragrapn on page a of the staff pacer was added to rescend to CGC concerns regarcing safety is ues. ANTICIPATED SCHECULING: Week of January 30, 19739 at an OPE.'LMeeting., /CVW b. $W& u Robert 3. Minegue, Director Office of Standards Develcpment

Enclosures:

"1" - Alternative A: Minimal Regulation uncer a Voluntary Arrangement with Carriers and Shippers Agents "2" - Alternative 3: Indirect Regulation af Carriers Taru Shipper Licensees Contract for Carriage With Carriers or Shippers Agents "3" - Alternative C: Direct Regulation of Trans; ort Ac 1vi-ies Thru Issuance of A General License t Possess 55NM "4" - Alternative 0: Direct Reculation of Transcort Activiues Thru Issuance of A Specific License o Possess SSNM "5" - ?rocosed Changes to 10 CFR Part 70 to Effect Alternative C for any ' arson wnc ?ossesses Special Nuclear Material 5ccject to 10 CFR 73 for tne Purpose of Transport "6" - Draft Public Announcement Commissicners' ccmments or ccnsent shculd be provided directly to the Cffice of the Secretary by ccb Wednesday, January 13, 1973. Commissicn s:aff office ccmrents, if any, should be submit:ed : the C:mnissioners NLT January 13, 1973, with an informa:icn c cy to the Cf# ice of the Secretary. If the paper is Of sucn a nature that it retuires additicnal nime for analytical review and comment, the Ccmmissicners and the Secretariat should be apprised of when comments may be expected. ,ISipt:.-.nd. s ...u..w Commiss:cners Ccmmissicn Staf# Cffices Exec Dir for Cperaticns Secretariat .~,.c.... a s a

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ENCLOSURE "1" Alternative A: Minimal Regulation Uncer a '/oluntary Arrangement with Carriers and Shippers Agents The present regulations in 10 CFR Part 73 require licensees who transport or wno deliver strategic scecial nuclear material to a carrier for transport, to submit a transcortation security olan for NRC acproval. ~or shipments which are made via contract or common carrier, arrangementa are made by the licensee *ita a carrier or a shipper's agent to submit to the NRC on behalf of the licensee the transport activities transportation security plan that will be imolemented and followed to meet NRC require-ments during the period of time that the SSNM is in the possession of the transport activity. Under this arrangement, the NRC does not exercise regulatory authority over carriers or shippers' agents respcnsible for transporting SSNM. In accition, the licensee continues to be held resocn-sible for protection of the material althcugh he does not possess it or exercise physical contrcl over it unile it is in transit. As a result of the exemption in 10 CFR 70.12 the NRC may not, witnout consent, enter common or contract carrier vehicles, aircraft, ships, or facilities to inscect their activities as they pertain to the protection of SSNM in the absenca af a license. Mcwever, NRC inspections have been carried out regularly with the cccperation of carriers and shippers' agents and until k s( Q ' Yli d 1 Enclosure 'l" MN ,,g.v.4-

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ENCLO5URE '2" Alternative 3: Indirect Regulation of Carriers Thru Shipper 'icensees Contract for Car-iage '4ith Carriers or Shippers Agents An indirect form of requiation would consist of a specific centract between a licensee and a carrier or shippers agent nich would set forth specific provisions to require carrier c n'craance to NRC ecuirements and to allow the NRC to inscect carriage and the trans:Ortation security systam. NRC regulations (10 CFR 70) ~cuid be amencec :: include a requiremtat for licensees who utili:e a snipper's agent or c:ntract or commen :arriers Oc submit as part of :nef r security plan a ::cy Of the scecifi: contr:c they wculd enter into t0 assure etention Of specific rights and authori-ties necessary to provide the NRC a legal basis to carry cut its inspec. tien functions. Uncer this arrangement, the licensee ~cuid continue to be responsible for araviding protection af the 55NM shi: men; a ali times. Thus, any NRC enforcement acti:ns for items af ncn-c moliance Or viciations Of NRC requirements by the transport activity would be taken against the licensee. For infractions of NRC requibements, that result in damages to the licensee, legal action against the car-ier could be Orcugnt by the licensee Or nis agent for damages in a civil action. A1 bcugn altarnative 3 wculd provide NRC with the legal authority to inspect carriers transport systems, there n (MiU,'\\\\\\, . cW s \\\\s _o ' \\\\ U ) '6 p\\o:k \\g 'lU v\\ h 1 inclosure '2" h -v'" '

is no clear legal basis for One NRC' to imccse fines cr :enalties for inf*2cti:ns of P.s regula icas in :ne absenca of a ifcanse. o O m \\ \\ h <*e, 'O, / % \\) Y , x, y' v 'N xy rsy.. a 0 2 Enclosure '2" T, v c.. - a 2

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ENCLOSURE "3" Alter ative C: Direct Regulation of Trans:cr. Activities Thru I3suance of A General License to ?cssess 55NM This alternative <culd require amencment of 10 CFR 70.12 to remove the exemotion from NRC licensing requirements for transport activities wno voluntarily transport types and quantities of SSNM sucject to the require-tents of 10 CFR 73 and would include a requiremant for issuance of a

eneral license to such transport activities.

The license wculd be effe:- tive 'cr any transport activity regardless Of :cde of transport witncut the filing of acpli:ati:ns with the COImission Or the issuing of licensi g cocuments to particular persons, and the transport activity would still be required to take shipments in accordance ith an NRC spor 0ved ranscorta-tion security plan prior.c transcorting 55NM. Under a general license, the transport activ ty espcasible for i arranging the snigment,culd be required to sucait a transecr ation security plan deac.ibing :ne security system to te used Oc protect an 55NM sniement. Mcwever, any transecrt activity wnc pcssasses 55NM wculd be responsible for assuring thsk tne SSNM is protacted in accordance with an NRC a: proved transcortation security plar, and system as provided by eitner the shipcer licensee, nis agent, or a carrier. This cotion would provide NRC the legal basis neecac :: inspect 3hipments of 55NM, 55NM snigment records and Other snigment relatec 'unc-tions of :arriers, shipcers' agents or other trans:crt activities inv01/ec ,h Q\\ h $b D codRN D ty A 1 5nclosure '5" cx\\QSt o r az,

in the transportation of 55NM, and 4cui: also provide the.4RC the legal .a 3 .o..- o.. ..a. e 4 2_n..,. .=.3.n.,c.<,n 21 -...,..c, c r. : v-. 4../.. ,,2 2.. o. ~. o. c. o2e....

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v.s. ,itarn a.' v e,: sicact Requ,ia :en :..irans0cr*.,c.;vi.:e5 _..'ru .3:uancs of A 3pecific License to Dossess 35NM This :otion would recuire carr'ers and snippers agents to f4ie a formal application fc.* a license in accordanca wi*.h filing rocedures crescribed in 10 C.:R Par: 70. Carriers and shipcers igents,culd tr.en be 3creer.ed inc 2 d e t e rm i n a. i c a r.ac e Is to 3 o r0 V a l O r t.s.e a p p,i : Ca * : c n. inis <' c *. '. v'.1 sc"'.w g" r ^s v i. '.' a.N.O P * " a. .n.' '..'. w r 4 w v.1 *w. ^s i' d n4. '. t % 2." --'.ar s'a d i" ** ** i ~ - i a a.1..' w" a..r a w ~.. .s 3 gents wou'd be permittad 10 enter the $5.NM transacrt busi es3. The NRC wo u i.a ' ave a,ega2 :as:5 ror c; rect requ,ist:3n Or, anc encarcament action against, car-iers or shipcers 2 gents when necessary. This Ootion would limit tne num:er Of transport activities that migr.: Otne. vi3e entar into the business because the limited imcunt af busines: 3V 21,. e* e .0 2 C2rri er 30 t,.e p."Ssen- *ite 33y act Oe 4Cr*.a ;he eX?ense r anc bCthe" Of being burder.ed Nith PeCuiremer.;5 OVer lad abcVe '.hc5e al r33cy - =. c, u '. - a. d 's,v ..h a. 7 F. w^, -'0 ~1, :3A

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