ML20056B509

Discusses Revs to 10CFR2 Re Challenges Immediately Effective NRC Orders (SECY-90-074)

ML20056B509
Person / Time
Issue date:	03/14/1990
From:	Cotter B Atomic Safety and Licensing Board Panel
To:	Carr, Roberts, Rogers NRC COMMISSION (OCM)
Shared Package
ML19336C343	List: ML20056B459 ML20056B466 ML20056B474 ML20056B480 ML20056B483 ML20056B487 ML20056B488 ML20056B495 ML20056B500 ML20056B509 ML20056B510 ML20056B511
References
FRN-55FR27645, RULE-PR-2 AD60-1-12, NUDOCS 9008290001
Download: ML20056B509 (7)

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g NUCLEAR REGULATORY COMMISSION g #p g Q-l ATOMIC SAFETY AND LICENSING BOARD PAN S,

W ASHINGToN, D.C. 20585 March 14, 1990 t

MEMORANDUM FOR:

Chairman Carr gL Commissioner Roberts s

Commissioner Rogers 1

Commissioner Curtiss Commissioner Remick,f&

J FROM:

B. Paul cotter, Jr.,

s Chief Adminitarative Judge Atomic Safety and Licensing Board Panel

SUBJECT:

REVISIONS TO PART 2 RE1tS.iCNG CHALLENGES 1

IMMEDIATELY EFFECTIVE STAFF ORDERS f

(SECY-90-074) l

.In Secy-90-074 (March 6, 1990), the Office of the Ceneral 1

Counsel recommended a series of amendments to 10 CFR Part 2 designed, in part, to provide an exclusive mechanism for expedited challenges to the immediately effectiveness of Staff enforcement orders.

Specifically, as part of other changes, OGC recommends that 10 CFR S 2.202 be amended to limit such cha?langes to motions to set aside the immediateness -f enforcement orders, provide for expedited (i.e.,

15 day) resolution of such motions, and direct a Licensing Board to sustain the immediate effectiveness of any staff order supported by " adequate evidence."

While the concept advanced by the OGC proposal provides needed clarification to the Commission's rules of practice, I believe that its implementation requires and deserves further discussion and development.

i For lack of any other clearly applicable alternative, challenges to the immediate effectiveness of staff enforcement orders are usually cast in terms of a motion for

' This is but the latest of what may be as.many as a score of Ad h2g amendments to Part 2 in contrast to the single, comprehensive rewrite of NRC procedures the ASLBP proposed in 1984.

We intend to resubmit such a rewrite to the Commission in June in an effort to establish a single set of rules for all cases in place of the current, a'icane patchwork we now labor under.

We also believe SECY r,0-

/

074's description of the Finlav case overlooks part'.es S/-

discovery rights under the Commission's rules ef. practice V

i and'the Board's obligation to effectuate those rights.

9008290001 900821 PDR PR 2 55FR27645 PDR p

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a stay'pendente lita.:

333, 10 CFR 5 2.788.

Instead of the' existing stay approach emphasizing a balancing of ll

" irreparable injury", " likelihood of_ success on the merits",

and "the.public interest", the proposed rule advanced by OGC 1l appears to focus exclusively on-whether " adequate evidence" l

exists _to support the Staff's underlying public health, safety or interest finding.

As explained in the l

Supplemental Information, j

... adequate evidence is akin to the probable cause necessary-for an arrest, a search warrant, or a preliminary hearing on a criminal matter.

This is 1

less than;must be shown at the hearing, but it must be more than uncorroborated suspicion or accusation. * *

• Admissible evidence by persons with first hand knowledge of the facts of the sort that would be required at the full adjudicatory 3

hearing is not essential.

SECY-90-074, E'oicaura A at 10.

)

First, in the context of immediately effective staff j

enforcement orders,.the burden properly resides with tha j

staff to provide the-necessary information to minimally justify challenged enforcement orders.

Thus, to the extent the OGC proposal can be read to require the recipient of' l

such an order to show through its motion why it should not be immediately effective, it should be modified.

Section 2.202 should clearly indicate that the burden of going forward on immediate effectiveness rests with the Staff.

Second,:it is not necessarily improper or ill-advised for 4

the Commission to permit enforcement orders, where necessary, to become immediately effective based on an.

evidentiary standard less-than that required to sustain the underlying order itself.after-a. full hearing.

However, the suggested " adequate evidence" standard, at least as defined in the supplemental Information, could be read to eliminate from consideration what I believe is the critical equation in any challenge to the interim effectiveness of a staff enforcement order:

a balancing of the irreparable harm to the recipient against the potential harm to the public health, safety or interest.

While the latter must always be paramount and given the greatest weight among any factors 2 OGC's proposal justifies expedited resolution of challenges to-the immediately effectiveness of Staff orders because "[t]here may be situations in which the subject of the order or others adversely affected may be irreparably damaged by the time the proceeding is concluded."

SECY 074 at 2.

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t considered, some mechanism must exist, in my opinion,

whereby the former.is considered.

Moreover, if the contours of the " adequate evidence" standard-remain' vaguely painted, 1

the standard could be a breeding ground'for additional.

1 litigation, both before the Commission's adjudicatory boards 3

and the Federal courts Neither of these potential problems flow from.the face of j

the proposed regulation itself.

Rather, as noted above, they arise from the discussion of the regulation in the Supplemental Information accompanying the proposed i

regulation.

Because of this, much of the risk of confusion over the substantive meaning of the proposed regulation can j

be eliminated by expanding the Supplemental Information's H

discussion to clarify the various factors that could be appropriately considered by a Board and how those factors are to be weighted under the " adequate evidence" standard.

Among the factors that should-be identified are:

(1) the H

potential for irreparable harm to the recipient; and (2) the j

need for the staff to make some minimal. showing that the b/

facts, potential or actual harms, or actions supporting immediate effectiveness occurred or will occur.

J Third, as presently drafted, proposed S 2.202 (c) (2) provides that motions to set aside the immediately effectiveness of an order "will be heard and decided expeditiously..."

As clarified.in the Supplemental Information to the proposed rule, it is-expected that the motion will be acted upon by thA Licensina Board within 15 days of its filing.

However, b/'

both the proposed amendments and the Supplemental Information make clear that such motions will routinely be made as pt.rt of any. initial Demand for Hearing.

-Because a Board does not acquire jurisdiction over a matter'until the hearing request is (1) received and processed through the office of the Secretary and perhaps OGC, (2) physically transmitted to the ASLBP, and (3) made the subject of a p

Board Const4treian Order issued by the Chief Administrative J

3 Cer+ i 1 ' this has been the pattern in both the state and Federo courts r-th respect to the meaning and applicatien

'f tb minal " probable cause" standard from I

which oGC n

+de vidence" standard was apparently i

derived.

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• e type of matters for which probable L

cause de' c

ot t as te appropriate (search warrants, temporary burdens (many times arrests, u s.

'wve-e measured fr as e minutes or hours) on the general right of a citizen c

,4 free from governmental interference.

Such burdens, u. my view, are significantly different from the type of burdens imposel by at least some immediately

-effective orders (e.g.,

suapension of business operations, termination of **ployees, etc.).

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Judge, it is:likely-that a significant portion of the-expected 15 day' period will pass before phe Board expected-l to decide the= matter is even identified Fourth,-the Supplementa1'Information appears to prohibit any Board decision without a1 consideration of the NRC Staff'and other parties to the proceeding.pnswers of the

'Yet, under 10 CFR $_2.730(c), the Staff is entitled to up to 15 days from the date of service of the motion to respond.

Under the Commission's practice, an additional three days are added to that number'if service was by regular mail..Thus, the commission's rules of practice could interact in such a way as to.make it impossible for a Board to satisfy the 15 day time period.

Fif th, propcS94 5 2.202(c) (2) provides that a Board is. to resolve th9 wetige "before any other issue raised by the answer."

7.n thk supplemental Information, however, the Board is psobibited from repolving the motion " prior to a determination on the standing of the party filing the notion."- It is difficult to const/ruct a situntion where a recipient of an immediately effective ptaff order would not i

have standing to challenge that order.

It is for more likely that the Commission's jurisdiction over a particular

{

' Because the proposed amendments essentially require immediate Beard action, the pool of potential adjudicators will, as a practical matter, be limited to full-time members of the ASLBP.

i 5 Given the timing of such motions, it is difficult to see how other persons could acquire party status within the 15 day time period.

It is possible for a person to demand a 1

hearing by arguing that he or she is " aggrieved" by an immediately effective order issued to another person.

However, the OGC proposal appears to limit the right to i

demand a hearing to recipients of staff orders.

In any case, the resolution of such difficult, fact-based standing questions, should they arise, could well prove impossible within the_15 day time period contemplated by the Supplemental Information.

' This problem might result from the Staff's use ad different terms to describe the same entity within the body of the proposed regulation.

The right to demand a hearing under S 2.202(b) is limited to "a licensee ~or other person to whom the Commission has issued an order.,"

However, the right to file a motion to set aside the immediate effectiveness of an order resides in "falnv narty to the proceeding...,in his demand-for a hearing."

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recipient of a staff order.will be placed at-issue.7 EAR 10 C.F.R. ' S-2. 202 (a) (Commission's authority limited to a

" licensee or other person subject to (its] jurisdiction.").

Yet, on its face, the proposed amendments would appear to preclude a Licensing Board from addressing this fundamental quection before determining whether the immediately effective staff order was supported by." adequate evidence."

And even-if the regulation was construed to authorize a Board to-reach such preliminary issues, the proper resolution of challenges to the commission's jurisdiction could require extensive briefing and perhaps, the conduct of 1

a short hearing, rendering compliance with the 15 day time period impossible.

Sixth, no special provisions are recommended regarding the 1

appellate procedures applicable to challenges to the immediate effectiveness of staff orders.

One possible approach would be to treat such challenges in a manner similar to motions to recuse a judge; i.e.,

Board decisions automatically referred to the Appeal Board.

Another.

l approach would be to treat Board decisions setting aside the

,immediate effectiveness of a staff order in a manner similar u'

to Board orders requiring the identity of a confidential,

. staff source of information; i.e.,

no such order can become effective until Commission review.

Finally, we note that,0GC's proposal is not the only.

possible mechanism through which aspects of staff orders can be quickly.rccolved.

One possible alternative would be to

. adopt, with appropriate modifications, the procedures and i

standards applicable to temporary restraining orders under Rule 65 of the Federal Rules of Civil Procedure.

For example, once a licensee or other party-made a written 1

demand that the immediate effectiveness of a staff order be-justified (to be distinguished from filing a motion to. set 4

such an order aside), the Staff could be required to file within 15 days appropriate papers and supporting documentation with'the Licensing-Board justifying the order..

Where necessary, the Staff's presentation might require the conduct of a short hearing.

Consistent with Rule 65, a Licensing Board would then evaluate the Staff's preliminary.

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Indeed, given that the major purpose of the proposed amendments is to clarify that NRC enforcement orders can be issued to non-licensees, it is reasonable to assume that challenges to the Commission's jurisdiction will become a common affirmative defense in cases involving non-licensees.

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t case and supporting witnesses in terms similar to the four y

factor'Vircinia~ Petroleum Jobberg. test.

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Christine N. Kohl, ~ ASI.AP.

t Samuel J.'Chilk, SECY r

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March 6, 1990 RULEMAKING ISSUE Sm:v6-dw (Notation: Vote)

For:-

The Commissioners From:

William C. Parler General Counse1~

j~~~Sub ect:

REVIS10ll TO RULES OF PRACTICE (10 C.F.R.

PART 2 SUBPART B) TO PROVIDE FOR (1)

EXPEDITED-HEARIflGS WHEN-REQUESTED IN CONNECTION WITH'IMMEDIATELY EFFECTIVE ENFORCEMENT: ORDERS AND,-(2) DELAYS IN EXPEDITED HEARINGS IN CERTAIN CIRCUMSTANCES (FINLAY SITUATION); INFORMATION CONCERNIf;G PROPOSED CHANGES TO'PART 110, SUBPART G.

P u rp~o s e :

To obtain Commission approval for changes to

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the Rules of Practice to provide expressly for (1) expedited hearings in connection with

-immediately-effective enforcement orders, (2) challenges to the-immediate effectiveness of-an order,-and (3) delays in the conduct of the expedited hearings when necessary, e.g. to allow the Department of Justice to complete its criminal investigation'of the circumstances giving rise to the en.orcement order; and (4) to advise the Commission as to-whether Subpart G of-10 C.F.R. Part 110, pertaining to enforcement actions for export / import licensees, can be eliminated.

Backoround:

In the' case of Finley ~ Testing Laboratories Inc.

the 1iceniii ins iuipiciiToT-IoTiting

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III m,aterials licens'e by improper shipments of

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a radiographic device.

During the course of 9

tite staf f's investigation into the matter, the Caputy EDO issued an immediately effective order suspending all activities under the license.

Finlay requested a hearing on NOTE:

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whether the suspension shouldlbe'susta'ined.

j While the matter wo s still inHa prehearing:

stage, the Departr4ent of Justice-decided to r

undertake a criminal.investigationLofcthe matter and requested that the' adjudicatory proceedings be-stayed until it completed.its investigation.

The protraction of the-proceeding. prompted by the request and by-Licensing Board discovery orders raised a concern with the Commission over the.

Commission's responsibilities vis~a vis the due process rights of the licensee, a

Accordingly, it asked that: procedures be.

established for future handling of such cases.

r Subsequent to Finlag, the need for additional i

procedural rule cEinges relating to immediately effective orders became evident.

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effectivi Brdir 2ht case, an immediate'ly riquiring the' licensee, inter:

alia, to establish and make payments into i--

Iruit fund for use in disposing of wastes at the site was challenged by the licensee as to the need for immediate effectiveness.

A resultant motion by the licensee to stay'the 1

-immediate effectiveness of the order raised questions as to the most efficient way to allow the challenge and at the.same time provide for the protection of the public health and-safety.

Discussion:

The rule proposed herein deals withLboth situations.

The' rule recognizes that where an immediately effective order-is~ involved, the subject of the-order is entitled toca prompt and expedited hearing on.the merits-inasmuch 4 -

as it is being required to obey the order before having the opportunityHto be heard.

q The rule' recognizes, however, that even though the case is-heard on an expeditec. basis, there may be situations in which the subject of the i

order or others adversely affected may be irreparably damaged by the time the1 proceeding j

is concluded.

Accoroingly, the proposed rule specifically allows the immediate effectiveness of the order to be challenged'at the outset where an adversely affected party-believes that inadequate justification exists for its immediate effectiveness.

Where such a challenge is made, the Licensing Board is required to hear the issue of immediate L

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L effectiveness, separately, without delay, and on an expedited basis at a mini-hearing at-r I

=which the:only issue for determination is whether adequate evidence exists-to support j

the need-for the order.to.be made immediately e f f e c t i v e _.lhis_ ni n t t e a r i n gui s_ e s s e n t i a l ly L

k an informal'one, generally without any right

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of discovery and cross-examination.. Adequate L

evidence for this purpose does not mean.the 1

same degree of proof-that is required for a s

merits determination, Rather, it is something j

.less, akin to the evidence that is necessary E(

to support an arrest, a' search warrant, or a preliminary hearing.on a criminal matter.

This procedure, we believe, provides:a party l

adversely affected by an immediately effective L

enforcement order with due process while h

allowing the Commission sufficient latitude to protect the public health and safety when immediate action is necessary.

s The proposed rule also allows the Commission p

or any other interested party to obtain a 1

m reasonable delay (the Finlay situation).either in the initiation or in~ tee. completion of the i

hearino on an immediately effective order.

Any delay must be based on a balance of the competing interests involved.

This proposed rule has been drafted as an amendment to the recently-approved Conmission rulemaking revising 10 C.F.R. Part 2, Subpart B (SECY-89-321).

The combined rule would be submitted for publication in the Federal Register as a single proposed rule on March 22, 1990, the date established by Staff Requirements Memorandum dated February 21, y

1990, assuming Commission approval of this rule in time to meet that target date.

In the i

event, however, Commission approval of the rule proposed herein is not obtained in time to meet that date, our preference is that the:

rule proposed in SECY-89-321 be published as scheduled.

In that circumstance, the rule proposed herein can be publisheo later following Commission approval.

In any event, whether the two proposed rules are published i

separately or not, they will be published as a single rule when published in final form.

In approving a proposed comprehensive revision of the NRC's rules of practice for issuing i

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f orders, SECY-89-321, the' Commission _also asked l

whether the provisions contained in Subpart G, ik to-Part 110 for issuing orders can be eliminated (see Staff Requirements Memorandum dated February 21, 1990). -The answer is1that Subpart_G to_Part 110 can be eliminated.

However, when Part 110 was initially promulgated, it was designed-to codify _in'one place export and import' regulations,' including" provisions for enforcement actions concerning-export and import licenses.

This codification of export and import regulations in one place-a

!c was based, in part, on'the factfthat the Administrative Procedure Act exempts foreign.

LD affairs functions from its adjudicatory provisions (see 5 U.S.C. 5.554(a)(4)).

Retaining Subpart G of Part 110 would continue to serve the purpose of keeping all. export and a

import-provisions-in one place and would assist in preserving.the distinction between proceedings to which the APA_ appl.ies and proceedings to which the APA does not apply.-

The Office of International-Programs is currently engaged in drafting proposed. major revisions to Subparts D through Liof Part 110,

.e including changes to Subpart G.

The proposed changes are intended to shorten considerably i

and clarify.the affected Subaarts, while at.

the same time reconfirming tie Commission's earlier decision to consolidate essentially all of the Commission's export / import m

licensing regulations-in a separate Part of k

Title 10.

International Programs anticipates submitting its' proposed revisions to the Commission over'the next several weeks and months.

Thus, any decision to change or eliminate Subpart G of Part 110 should take into account the comprehensive review of Part 110 regulations now underway by International Programs.

If it is decided to eliminate H

Subpart G to Part 110, minor changes to Part 2 (including its title and Subpart G, for example) will be needed.

Recommendation:

That the Commission:

1.

Approve incorporation of the changes J

prop 5se3 Eerein in the rule proposed by SECY-89-321 and approved by the Commission.

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Note.

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-The rule. proposed in-SECY!Ii!321 and the rule proposed herein will' be published as a single-rule ifzthat can be-i done without causing delay in the: publication of the SECY-89-321 rule changes.

Otherwise, the_SECY.89-321 proposed rule w111Ebe.

g published as-scheduled with publication of the rule proposed herein to. follow.

In any event, when published in final form, both rules will l

be published as a single rule.-

b.

If the rule proposed.herein is published.

separately, the same steps _ noted in SECY-89-321 will be taken to the extent applicable.

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The drafting of proposed. changes to Part.

c.:

110, Subpart G, pertaining to enforcement.of import / export regulations, is being undertaken

'by the Office of Internationa grams.

{

111am C. Parler General Counsel l

EncJpsgre:

Draft rule (62.202) and explanatory statement Commissioners' comments 1or consent should be provided directly '

.to-the Office of the. Secretary by COB Monday, March 19, 1990.

q 1

Commission Staff Office comments, if any, should be submitted to'the Commissioners NLT Monday, March 12, 1990, with an infor-I mation copy to the Office of1the Secretary.

If the paper is of i

such'a nature that it requires additional time-for analytical review and comment, the-Commissioners and the Secretariat should

-be apprised of when comments may be expected.

DISTRIBUTION:

l Commissioners OGC' OIG' LSS GPA REGIONAL OFFICES EDO ASLBP ASLAP SECY 5

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Enclosure A NUCLEAR REGULATORY COMMISSION 10 C.F.R. Part 2 Revisions to Procedures to Issue Orders j

AGENCY:

Nuclear Regulatory Comission.

ACTION:

Proposed rule.

l

SUMMARY

The Nuclear Regulatory Comission (NRC) proposes to revise the L-L Comission's procedures for issuing orders to include persons not licensed by

- t l

.the Comission but who are otherwise subject to the Comission's jurisdiction; The proposed revisions would more accurately reflect the Comission's existing' i

l statutory _ authority to issue orders than is presently the case. The revision also identifies the types of Comission orders to which hearing rights attach.

DATES: The coment period expires on (75 days af ter publication in the -

Federal Register). Coments received after this date will be considered if it-1 L

is. practical to do so, but assurance of consideration cannot be given except l~

as to coments received on or before this date.

ADDRESSES:

Send written coments to the Secretary of the Comission, U.S.

j_

Nuclear Regulatory Comission, Washington, DC 20555, Attention:

Docketing and l

Service Branch.

Coments may also be delivered to the Office of the

(,

'I 9 l i

-Secretary, U.S. Nuclear Regulatory Commission, One White Flint North,11555-Rocky-i.11e Pike, Rockville, Maryland, between 7:30 a.m. and 4:15 p.m. weekdays.

1--

2 Copies of. any comments received may be examined and copied for a fee at the

' NRC Public Document Room, 2120 L Street, NW, Washington, DC between the hours f

of 7:45 a.m. and 4:15 p.m. weekdays.

l

. FOR FURTHER INFORMATION CONTACT: Mary E. Wagner, Office of the General Counsel, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, Telephone:

301-492-1683.

i SUPPLEMENTARY INFORMATION:

===.

Background===

1 The procedures to be followed by the Commission to initiate formal enforcement action are found-in the Commission's Rules of Practice set forth in.10 C.F.R. Part 2, Subpart B.

These actions include notices of violation, described in 5 2.201, show cause orders, described in 5 2.202, orders to modify licenses, described in 5 2. 204, and civil penalties, described in-5 2.205.

Until 1983, with the exception of the civil penalty procedures in '

5 2.205, the language in these procedures referred solely to licensees. At that time, it was recognized that the Commission's regulations did not provide a procedural mechanism to issue a formal notice of violation to an unlicensed person (corporate or individual) who had violated Commission requirements.

For example, by referring only to licensees, the procedures in 5 2.201 did not address issuing a notice of violation to a person who possessed radioactive

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material without a license in. violation of Commission requirements or an

-unlicensed person who violated provisions of 10-C.F.R. Part 21, which implements Section 206 of the Energy Reorganization Action of 1974 Consequently, the Comission amended its regulations to permit the issuance of notices of -violations to unlicensed persons,who violated Comission -

requirements.

Changes.were published in the Federal Register on September 28, i

1983(48 Fed. Reg. 44170) to amend i 2.200 (Scope of subpart) and i 2.201 (Notice of violation) to add the phrase "or other person subject to the jurisdiction of the Comission."

As stated above, the provisions for issuing show cause orders only i

address ' licensees.- In practice,.the Comission has fashioned orders-to non-licensees where necessary to cor.ipel a person to cease unauthorized activities that would require a license or to compel actions by a former l_icensee with respect to its activities previously under license. See e.o., flichael F. Dimun, 54 Fed. Reg.12704 (March 28,1989); Pacific Armatechnica Coro., 48 Fed. Reg. 38356 (Aug. 23,'1983). The Comission's statutory authority to issue orders, which is found in Section 161 of the j

Atomic, Energy Act of 1954, as amended, 42 U.S.C. 5 2201, is not limited solely to licensees.

In fact, the Comission's Atomic Energy Act authority to issue orders is. extremely broad, extending to any person (defined in Section 11s to

-include, e.g., any individual, corporation, federal, state'and local agency) who engages in conduct within the Comission's subject matter jurisdiction.

The few court cases which deal with the scope of the general authority Congress has granted the Commission usually do so in a general discussion or in passing and conclude that Section 161 confers uniquely broad and flexible r

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authority on.the Comission.

See Power Reactor Dev. Co. v.-International-e Union of Elec.. Radio'and Mach. Workers, AFL-CIO, 367 U.S. 396 (1961);

t Connecticut Light and Power Co. v. Nuclear Regulatory Com'n, 673 F.2d 525, 527, n. 3 (D.C. Cir.1982); New Hampshire v. Atomic Eneroy Com'n,: 406 F.2d 170,173-74'(1st Cir.1969); Siegel v. Atomic Energy Com'n, 400 F.2d 779, 783 (D.C. Cir. 1968); but ef. Reynolds'v. United States, 286 F.2d 433 (9th Cir.

1960)(interpretingSection.1611indetailandholding,inthecontextofthe AEC's bomb testing activities, that Section 1611(3) authorized the AEC to-take-action to govern the activities of private licensees and not the activities of the Commission itself; the court's use of the word " licensee" is dictum with regard to the term in the context of this notice),

f Cases analyzing _the Federal Comunications Comission's (FCC) enabling statute, which, in many ways, is analogous to the 1954 Act, also support the principle that the Comission's authority is broad in scope. The Federal

.3 Communications Act of 1934-(the 1934 Act) broadly authorizes the FCC to "make such rules cnd regulations, and issue.such orders, not inconsistent with [the 1934 Act), as may be necessary in the execution of_ its functions", 47-U.S.C.

$'1541(1982). This provision is similar to Section 1611(3) of the' Atomic

[

Energy Act of'1954,. which authorizes the Comission to " prescribe such rules, 9

regulations, and orders as it may deem necessary to govern any activity i

authorized pursuant to the [ Atomic Energy Act of 1954]... in order to protect health.nd to minimize danger to life or property...." 42 U.S.C.

52201(i)-(3)(1982).

A number of cases have analyzed Section 1541 in detail and determined that the FCC's ordering authority is necessarily broad.

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5-g See Federal Comunications Com'n v. National Citizens Comittee for-Broadcasting, 436 U.S. 775 at 793 (1978); United States v. Storer j

BroadcastingCo.,351U.S.192at203-(1955); National Broadcasting Co~ v.

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United States 319 U.S. 190 at 196 (1943); Lincoln Telephone and Telegraph Co.

j

v. Fede

. Comunications Com'n, 659 F.2d 1092 (D.C. Cir.1981); American Telephone and Telegraph v. Federal Comunications Com'n, 487 F.2d 865 (2d Cir. 1973); GTE Service Corp. v. Federal Communications Com'n, 474 F.2d 724-(2d Cir. 1973); and Western Union Telegraph Co. v. United States, 267 F.2d 715,.722(2ndCir.1959).

It has been held that the FCC has authority to issue orders under Section 1541 to persons whether licensed or not.

United States v. Southwestern Cable, 392 U.S. 157, 180-81 (1968).

l Section 1611 provides broad authority to issue orders as the Comission l

6 deems necessary to govern any activity authorized pursuant to the Atomic l

Energy Act in order to protect the public health and safety.

Section 161b i

l similarly authorizes the Comission to issue orders to establish standards and instructions to govern the possession and use of special nuclear-material, source material, and byproduct material. As relevant here, Section 1610 authorizes the Commission to order reports as may be necessary to effectuate l.

the purposas of the Act.

Given this broad statutory authority, it is appropriate to amend 10 C.F.R. 6 2.202 to have the procedural mechanism in place to' issue orders, as necessary, to unlicensed persons when such persons have demonstrated that future control over their activities subject to the NRC's jurisdiction is deemed to be necessary or desirable to protect public health and safety or to minimize danger to life or property or to protect the common defense and A

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. 1 security. This amendment would revise 5 2.202 to establish'that mechanism both as to a _ licensee, as the current 6 2.202 provides, and to any person subject to the jurisdiction of the'Comission. Such a person includes, but is not limited to, a person who held a license or who was otherwise engaged in licensed activities at the time of the conduct in question, but who no longer holds a license or is so engaged.

In addition, the procedural mechanism _for issuing orders to show cause,.

renamed demands to show cause by this rulemaking, to licensees and other persons would be set forth in a separate section in order to make it clear that the right to a hearing does not attach at the time of issuance of a mere demand for information; i.e., a demand that a person or licensee "show cause"

. why _it should not-be compelled to take or refrain from' certain action, t

Orders, including orders to show cause, currently are issued under Section 161 of the Atomic Energy Act of 1954, as amended, which are implemented by

$5 2.202 (order to show cause), and 2.204 (order.for modification of license).

In addition, civil penalty orders are issued under Section 234, implemented by-4 9 2.205-(civil penalties).

NRC practice ' commonly has been to issue a single-order, an order to show cause, which requires that certain information be provided.to demonstrate why either a proposed or imediately effective action modifying, suspending, or revoking a license should not be taken. The order affords a hearing with regard to these actions. While Section 18' of the

' Atomic Energy Act provides for the granting of a hearing in connection with proceedings to modify, suspend, or revoke 'a license, neither the Act'nor the Administrative Procedure Act would require a hearing in connectior, with an

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c.

order to show cause which requires only the submission of information, but does not by its _ terms modify, suspend or revoke a license.

.The Act does not explicitly set out the form or requirements for an order to show cause. The Act does, however, authorize the Comission to collect information pursuant to Sections 161c and o and the. Comission may -issue show -

cause orders to implement this authority.

Section 182 of-the Act authorizes.

the Commission to request information from licensees and the Comission has implemented this authority by promulgating regulations such as 10 C.F.R.

i50.54(f).

Licensees subject to Comission requests under 10 C.F.R.

i 50.54(f) or its equivalent in other parts of the NRC's regulations have no -

V tag rights under the Act regarding these information requests.

Accordingly, to clarify that hearing rights do not attach to mere "show cause" demands; for information, the Comission proposes to separate its current provisions on orders to show cause from the Commission's general ordering authority contained in i 2.202.

To avoid any confusion with orders-under revised-6 2.202, such actions will be called " demands to show cause" and.

provisions concerning demands to show cause are. set forth in a new i 2.204.

Under the proposed rule changes, a demand to show cause will be issued only to require the submission of information.

If a demand to show cause is issued as part of an order requiring action pursuant to i 2.202, hearing rights will be offered but only with respect to the provisions of the order requiring action.

This revision to the regulations governing orders changes the rule in Dairyland Power Cooperative, LBP-80-26, 12 NRC 367, 370-72 (1980) and Consumers Power comoany, CLI-73-38, 6 AEC 1082 (1973), by setting the point at

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which a " proceeding" begins for purposes of triggering the adjudicatory rights l

l L

8-under Section 189 of the Atomic Energy Act to the point of issuance of an order compelling a licensee or other person to take or refrain from certain.

l actions rather than the point where the agency merely demands information to

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show why no action should be taken. The change in practice is consistent with the Comission's power to define the scope of its proceedings. g Bellotti v. NRC, 725 F.2d 1380 (D.C. Cir. 1983).

The proposed i 2.202 adds new features not present in the current 6 2.202 or i 2.204 Section 2.202 now provides that the action proposed by a show cause order issued pursuant to that section may be made temporarily effective i

in two' circumstances:

(1) where the public health, safety or interest recuires it; or (2) where the violation beino charged or conduct causing the violation is willful.

Similarly, current i 2.204 provides that an order directing modification of a license issued pursuant to that. section may be made immediately i

effective when reouired by the public health, safety or interest. Where such an order is involved and a hearing is demanded, there.is no existing provision that specifically calls for an expeditious hearing on the order. An expeditious y

.. hearing is essential due to actions reouired of the recipient of the order prior l

to conducting a hearing on _the merits of the order.

Nor is there a provision g

that specifically allows for a delay in the start or in the completion of such hearing where good-cause for such delay exists.

Section 2.202, as proposed, I

is intended to fill those gaps.

L Proposed 6 2.202 authorizes the Commission to institute enforcement proceedings by the issuance of enforcement orders against licensees or other persons subject to the Commission's jurisdiction for violations of law, reculation or license.

As in the current 6 2.202, the order may be made

4 9

immediately effective pending further ord,er where the Commission finds _that the public health, safety or interest so_reouires or that the violations or conduct causing the violations are willful. The licensee or other person to whom.the Commission has issued the order must answer the order.

If a hearing is demanded, the Commission will issue an order designating the time and place of hearing.

Further, proposed i 2.202 contains additional language, not contained in current i 2.202, providing=that if'the order is effective immediately and any adversely affected party believes the immediate effectiveness to be unjustified, that party may reouest that the immediate effectiveness of the order be set aside. Such a motion must be filed contemporaneous 1y with the demand for hearing'or separately on or before the latest date set forth in the order for the filing of the demand for hearing, but'in any event may not be filed before the filing of such demand.

In order to expedite consideration of a motion to set aside, such a motion, and a demand for hearing, may be filed separately from cry answer reouired under 6 2.202(b).

Where such a motion is made, the Atomic Safety and Licensing Board or Presiding Officer will decide the matter of immediate effectiveness expeditiously; that is, promptly, efficiently, and on an accelerated basis.

It is expected that such a motica will normally be acted upon within 15 days of its filing.

)

Under proposed 5 2.202, the only means to challenge the immediate effectiveness of an order is by a motion to set aside the order's immediate

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. effectiveness.

The Atomic Safety and Licensing Board or Presiding Officer

-shall not sua sponte set aside an _ order's imediate effectiveness provision.

in deciding a motion to set aside the imediate effectiveness of an order, the Atomic Safety and Licensing Board or Presiding Officer will consider 4

theanswerstothemotionfiledbytheNRbstaffandanyotherpartyto the proceeding. A motion to set aside shall not be determined prior to a determination on'the standing of the party filing the motion. The only ground on which the imediate effectiveness of the order may be set aside is that adequate evidence does not exist to support the finding in the order that the public health, safety or interest reouires imediate effectiveness or that the violation was willful.

For this purpose, adequate evidence is akin to the probable cause necessary for an arrest, a sear _ch warrant, or a preliminary hearing on a criminal matter. This is less than must be shown at the hearing,-

but it must be more than uncorroborated suspicion or accusation.

See Horne Brothers, Inc. v. Lairo, 463 F.2d 1268,1271 (D.C. Cir.1972).

See also, Transco Security, Inc. v.-Freeman, 639 F.2d 318 (6th Cir. 1981.), cert denied, 454-U.S. 820 (1981).

AdV,ssible evidence by persons with first hand knowledge of the facts of the sort that would be required at the full adjuoicatory hearing

.is not essential.

In this regard, 6 2.202 contemplates that any controversy over whether adequate evidence exists to support the imediate effectiveness will be resolved through informal hearing proceoures, normally without discovery an'd j

without rights to cross-examination.

The Comission's authority under 6 2.202 to issue imediately effective enforcement orders also includes the authority to issue amendatory or supplemental orders that are immediately effective.

If such an order is issued

.J by the Comission after a hearing has been ordered, the licensee or other party affected may, by motion pursuant to i 2.730, request that the imediate-effectiveness of the amendatory or supplemental order in question be set aside pending resolution of the imediate effectiveness question. Such a motion will be given expedited consideration by the Board or Presiding Officer and decided

f on the basis described above.

1 i

Under 6 2.202, as proposed, a licensee or other person adversely affected by an immediately effective order who reouests a hearing is entitled to an expeditious resolution of the issues properly raised consistent with the requirements of due process. There may be certain circumstances that

_ constitute good cause for reasonable delays in the conduct of the hearing.

As

-an example, at-times, there may be possible criminal violations involved in i

connection with a particular' violation that is the subject of the Comission's

-imediately effective order.

In such instances,'to allow the U.S. Department of Justice to undertake the necessary criminal investigation without prejudice to possible prosecution of any discovered crime, it may be necessar: to hold

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_the hearing on the immediately effective order in abeyance for a reasonable period of time, pending completion of the criminal investigation and decision i

on criminal prosecution.

Revised i 2.202 ellows the Comission, either on motion by the staff or any other party, to delay the hearing in such cases, for L

such periods as may be appropriate in the circumstances.

The length of a delay should be based on a balance of the competing interests involved. See Logan v.

Zimerman Brush Cc., 455 U.S. 422, 434 (1982).

1 In order to avoid unnecessary duplication in the regulations, it is proposed that the current i 2.204, " Order for modification of license," be L

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deleted from Part 2, since procedures for modification of a license are i

. included in proposed i 2.202.

Proposed i 2.202(f) provides that if the action ordered by the Comission constitutes a backfit of a Part 50 licensee, the-procedures described in 10 C.F.'R. I 50.109 must be followed.

This provision currently appears in the last sentence of i 2.204.

Section 2.202 is also revised to provide that if the licensee or other-person to whom an order is issued consents to its issuance, or the order confirms actions agreed to by the licensee or such other person, such consent or agreement constitutes a waiver by the licensee or such other person of a right to a hearing and any associated rights. Such orders will be imediately effective. This is not a departure from current Comission practice, but merely conforms the Comission's regulations to such practice.

Section t

2.202(d) also provides that the licensee's or other person's agreement to an i

order must be in writing. The addition of this provision is intended to minimize the possibility of issuance of a confirmatory order (i.e., an order intended to conf.irm and. bind a licensee to its comitments -to certain actions) which-does not accurctely reflect the agreement reached by the parties.

Whether or not the licensee or other person consents to any order, a person adversely affected by an order issued under 9 2.202 to modify, suspend or revoke a license will be offered an opportunity for a hearing pursuant to i 189 of the Atomic Energy Act, consistent with current practice and the authority of the Comission to define the scope of the proceeding on an enforcement order.

SeeBellottiv.NRC,725F.2d1380(D.C.Cir.1983).

The Comission will continue to publish orders iti the Federal Register in accordance with current practice.

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The existing,$ 2.202 vests authority to issue orders in the Executive DirectorforOperations(EDO),andvariousstaffofficedirectors.

Currently, l

the rule limits the ED0's authority to issue orders to emergency situations.

'l

,i Existing i 2.204 vests authorit'y to issue orders in the Comission, though

]

this authority has been delegated,to staff officers. The revised rules i

consistently vest such authority in the Comission, leaving it to.the Comission's internal delegation authority to delegate such authority to others. This change wi'11 avoid the need to amend the regulations each time the title of one of the currently enumerated officials is changed, and it will j

also remove the unnecessary limitation on the ED0's authority.

The Comission is retaining, in new i 2.202(e), a provision that, upon a finding that the public health, safety or interest so requires or that the violation is willful, the proposed action may be made imediately effective, pending further proceedings on the order. A similiar provision appears in I

current 5 2.202(f) and i 2.204.

Relief from the requirements of an immediately effective order, on the other hand, may be sought under the relaxation provisions contained in that order, or by motion to the Atomic Safety and Licensing Board or the Presiding Officer if a hearing has been requested.

The proposed rule also continues, in i 2.202(f), the backfitting requirements of i 50.109, including the provision therein that when imediately effective action f s required, the documented evaluation may follow, rather than precede, the regulatory action.

Finally, consistent with the changes to 65 2.202 and 2.204, i 2.1 is amended to specify that the scope of Part 2 includes the issuance of orders

e and demands to show cause to unlicensed persons, and i 2.700 is amended to specify that Subpart G (Rules of General Applienbility) applies to all adjudications initiated by an order.

TheproposedamendmentsaYeproceduralinnature. They do not establish the substantive standards or conditions under which the NRC would issue an order to a licensed or an unlicensed person.

The Commission is proposing, in.

a separate rulemaking published simultaneously with this rulemaking, a substantive addition to its regulations in order to put unlicensed persons on notice that they may be held accountable for willful misconduct which undermines, or calls into question, adequate protection of the public health and safety.

Once the proposed rules are in effect, consistent with the Comission's statutory authority, there will be procedural rules governing the issuance of an order or show cause order not only to a licensee, is currently provided, but also to an unlicensed person who willfully causes a licensee to be in violation of Commission requirements or whose willful misconduct undermines, or calls into question, the adequate protection of the public-health and safety in connection with activities regulated by the NRC under the Atomic Energy Act of 1954,'as amended.

An example of a situation in which it might be appropriate to issue an order to an unlicensed person is where an employee of a corporate licensee might willfully cause that licensee to be in violation of Comission:

requirements such that the Comission does not have reasonable assurance that requirements to protect the public health and safety will be followed if that person continues to engage in activities licensed by the Comission.

Depending on the circumstances in such cases, it might be appropriate to issue l

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an order to such a person to either prohibit the person from being involved in activities licensed by the Commission or require the person to provide prior by notice to the Commission before engaging in licensed activities..These types O

of conditions have been used by the Commission in settlement of litigation in i

accordance yith 10 C.F.R. 2.203. See. Edward Hines, Jr. Medical Center, ALJ-88-2, 27 NRC 477 (1988), and Finlay Testino Laboratories, Inc., LBP-88-17, 27 NRC 586 (1988).

This rulemaking establishes the procedures to be used in issuing orders to licensed and unlicensed persons. The procedures establish the mechanism to provide notice of the issuance of an order and to resolve, through adjudica-i tion, whether a particular order is appropriate under the circumstances.

Environmental Impact: -Categorical Exclusion The NRC has determined that this proposed. rule is the type of action described in categorical exclusion 10 C.F.R. 51.22(c)(1). Therefore neither an environmental impact statement nor an environmental assessment has oeen-prepared for this proposed rule, i

t Paperwork Reduction Act Statement This proposed rule contains no information collection requirements and therefore is not subject to the requirements of the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.).

2-Regulatory Analysis The existing regulations in 10 C.F.R. 2.202 authorize the NRC, through its designated officials,. to institute a proceeding to modify, suspend, or revoke a: license by service of'an order to show cause on a licensee. The regulations, as currently written, do not provide procedures for the NRC to.

take direct action against unlicensed persons whose willful misconduct causes.

a licensee to violate Commission requirements or places in' question reasonable assurance of adequate protection of the public health and safety, although such action is authorized by the Atomic Energy Act of 1954, as amended.

The amendments will make the Commission's Rules of Practice more consistent with the Commiss' ion's existing statutory authority and provide the appropriate procedural framework to take action, in appropriate cases, in order to protect the public health and safety.

The amendments also will make, clear that hearing rights do not attach to orders to.show cause, consistent with 6 189 of the Atomic-Energy Act of 1954, as amended, and the Administrative Poocedure Act.

The proposed rule constitutes the preferred courst of action and the cost involved in its promulgation and application is necessary and appropriate.

The foregoing discussion constitutes the regulatory analysis for this proposed rule.

Regulatory Flexibility Certification As required by the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)),

-the Commission certifies that this rule, if adopted, will not have a signif-icant economic impact on a substantial number of small entities.

The proposed rule establishes the procedural mechanism to issue orders to show cause to

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unlicensed persons in addition to licensed persons, who were previously.

1 covered. The' proposed rule, by itself, does not impose'any obligations on l-entities including'any regulated entities that may fall within the definition.

of "small entities" as set.forth in i 601(3) of the Regulatory Flexibility

.Act, or within the definition of "small business" as found in i 3 of the Small Business Act, 15 U.S.C. I 632, or within the.Small Business Size Standards found in 13 C.F.R. Part 121.

Such obligations would not be. created until an order is issued, at which time the person subject to-the order would have a right to a hearing in accordance with the regulations.

Backfit Analysis a

This proposed rule does not involve any new provisions which would impose

backfits as' defined in 10 C.F.R. 50.1(19(a)(1). Accordingly no backfit analysis pursuant to 10 C.F.R. 50.109(c) is required for-this proposed rule.

List of Subjects in 10 C.F.R. Part 2 Administrative practice and. procedure,. Antitrust, Byproduct material, Classified information, Environmental protection, Nuclear materials, Nuclear power plants and. reactors, Penalty, Sex discrimination, Source material,

)

i Special nuclear material, Waste treatment and disposal.

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended, the Energy Reorganization Act of 1974, as amended, and 5 U.S.C. 552 and 553, the NRC is proposing to adopt the following amendments to 10 C.F.R. Part 2.

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Part 2 '-- Rules of Practice for Domestic Licensing Proceedings 1.

The authority citation for Part 2 is revised to read as foll'ws:

o Authority:- Secs. 161,181, 68 Stat. 948, 953, asamended-(42.U.S.C.

2201,2231);sec.191,asamended, Pub.L.87-615, 76 Stat. 409 (42 U.S.C.

[;

2241); sec. 20*, 88. Stat. 1242, as amended (42 U.S.C. 5841); 5 U.S.C.,552.

I Sec. 2.101 also issued under secs. 53, 62, 63, 81, 103,'104, 105, 68 t

Stat.-930, 932, 933, 935, 936, 937, 938, as amenced (42 U.S.C. 2073,~2092,-

l 2093, 2111, 2133, 2134, 2135); sec. 102, Pub. L.91-190, 83 Stat. 853,-as

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amended (42 U.S.C. 4332); sec. 301, 88 Stat.1248 (42 U.S.C. 5871).

Sections 2.102, 2.103,_2.104, 2.105, 2.721 also issued under secs. 102, 103, 104, 105, 183, 189, 68-Stat. 936, 937, 938, 954, 955, as amended (42 U.S.C. 2132, 2133, 2134,2135,2233,2239).. Section 2.105. also issued under Pub. L.97-415, 96 Stat.2073'(42.U.S.C.2239).

2".tions 2.200-2.206 also issued under secs..

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i 161b, i, o, 182, 186, 234, 68 Stat. 948-951, 955,,83 Stat. 444, as amended (42 U.S.C. 2201(b), (1), (o), 2236, 2282); sec. 206, 88 Stat.1245 (42 U.S.C.

5846). Sections 2.600-2.606 also issued under sec. 102, Pub. L.91-190, 83' Stat.853,asamended(42U.S.C.4332). Sections 2.700a, 2.710 s ko issued under 5 U.S.C. 554.

Sections 2.754, 2.760, 2.770,.2.780 also issw d under 5 U.S.C. 557. Section 2.764 and Table 1A of Appendix C are also issued under secs. 135, 141 Pub. L.97-425, 96 Stat. 2232, 2241 (42 U.S.C. 10155, 10161).

Section 2.790 also issued under sec.103, 68 Stat. 936, as amended (# U.S.C.

2133) and 5 U.S.C. 552. Sections 2.800 and 2.808 also issued under 5 U.S.C.

553. Section 2.809 also issued under F U.S.C. 553 ar.d sec. 29, Put. L.85-256, 71 Stat. 579, as amended (42 U.S.C. 2039).

Subpart K also issued l

.'o.

a under sec.189, 68 Stat. 955 (42 U.S.C. 2239); sec.134, pub. L.97-425, 96 Stat.2230(42U.S.C.10154). Appendix A also issued under sec. 6. Pub. L.91-560,84 Stat.1473(42'U.S.C.2135). Appendix B also issued under sec. 10, Pub. L.99-240, 99 Stat. 1842 (42 U.S.C. 2021b et seq.).

2.

I 2.1 is revised to read as follows:

i 2.1 Scope.

This part governs the conduct of all proceedings, other than export and import licenst.ag proceedings described in Part 110, under the Atomic Energy Act of 1954, as amended, and the Energy Reorganization Act of 1974, for:

(a) granting suspending, revoking, amending. or taking other action with respect toany. license,constructionpermit,orapplicationtotransferalicense;(b) issuing orders and demands to show cause to ' persons subject to the Comission's jurisdiction, including licensees and persons not licensed by the Comission; (c) imposing civil penalties under section 234 of the Act; and (d) public rulemaking.

b.,

3.

I 2.202 is revised to read as follows:

I 2.202 Order.

(a) The Comission may institute a proceeding to modify, suspend, or revoke a license or to take such ot h r action as may be proper by serving on the licensee or other person subject to the jurisdiction of the Ccmission an order that will:

(1) Allege the violations with which the licensee or other person subject to the Comission's jurisdiction is

• charged, or the potentially

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' hazardous conditions or other facts deeined to N sufficient ground for the proposed action, and specify the action proposed; (2) Provide that the licensee or other person must file a written answer to the order under oath or affirmation within twenty (20) days of its date, or such other time as may be specified in the order; (3) Inform the licensee or any other person adversely affected by the order of his right, within twenty (20) days of the date of the order, or such other time as may be specified in the orcer, to demand a hearing on all or part of the order, except in a case where the licensee or other person has consented in w.'iting to the order; (4) Specify the issues for hearing; (5) State the effective date of the orderi and n

(6) Provide, for stated reasons, that the proposed action be immediately effective pending further order where the Commission finds that the public health, safety or interest so recuires or that the violation or conduct causing the violation is willful.

j (b) A licensee or other person to whom the Commission has issued an f

order under subsection (a) must respond to the order by filing a written answer under oath or affirmation. The answer shall specifically admit or deny j

each allegation or charge made in the order, and shall set forth the matters I

of fact and law on which the licensee or other person relies, and, if the order is not consented to, the reasons as to why the order should not have been issued.

Except as provided in (d) below, the answer may include the demand for a hearing.

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(c)

(1) If [de-answer-demands) a hearing is demanded, the Comission will issue an order designating the time and place of hearing.

If a hearing i

is demanded with respect to an immeciately effective order, the hearing will j

be conducted expeditiously, giving due consideration to the rights of the

)

parties.

(2) Any party to the proceeding may, in his demand for a hearing, or, separately thereafter but within the time set forth in the order for the t

filing of a hearing demand, move to set aside the imediate effectiveness of the order.

Such a motion will be heard and decided expeditiously, before any other issue raised by the answer. The.imediate effectiveness of the order will be upheld upon a ft1 ding that adequate evidence exists to support its s

immediate effectiveness.

(3) Where goed cause exists, the Commission may, on motion by the i

staff or any other party to the proceeding, delay the hearing on the imediately effective order at any time for such periods as are consistent t

with the due process rights of the licensee and other affected parties.

(d) An answer may consent to the entry of an order in substantially the form proposed in the order with respect to all or some of the actions proposed in the order. The consent of the licensee or other person to whom the order has been issued to the entry of a consent order shall constitute a waiver by the licensee or other person of a hearing, findings of fact and conclusions of law, and of all right to seek Comission and judicial review or to contest the validity of the order in any forum as to those matters which have been consented to or agreed to or on which a hearing has not been requested. The consent order shall hav*e the same force and effect as an order made after l

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l hearing by a presiding officer or the Comission, and shall be effective as provided in the order.

[(e)--When-the-Gemm4ss4en.(4nds-that-the-pWh44e-health,-safety,-ep-4mterest so-peqW4 pes-op-that-the-v4e4a44en-et-GondWit-faWs4ng-the-Y4e4444en=46-W434fW49 t h e-o rd e r-may - p ro v 4 de,- f e p - s t a t ed - Pe a so n s,- s h a t - t he-p ro po s ed - a s 44 en e be 4mmed4 ate 4y-effes44ve,]

l 1(e)

If the order involves the modification of a Part 50 license and is a backfit, the requirements of i 50.109 of this chapter shall be followed, unless the licerisee has eqnsented to the action required.

4 I 2.204 is revised to read as follows: i 2.204 Demand to Show cause.

(a) The Comission may issue to a licensee or other person subject to the jurisdiction of the Comission a demand to show cause why such actions as may be proper should not be taken, which will:

(1) Allege the violations with which the licensee or other person is charged, or the potentially hazdrdous conditions or other facts deemed to be sufficient ground for the proposed action, and specify the action proposed; and (2) Provide that the licensee or other person must file a w itten answer to the demand to show cause under oath or affirmation within twenty (20) days of its date, or such other time as may be specified in the demand to show l

cause.

(b) A licensee or other person to whom the Comission has issued a demand to show cause under this section must respond to the demand by filing a l-

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i written answer under oath or affirmation.

The answer shall specifically admit or deny each allegation or charge made in the demand to show cause and shall set forth the matters of fact and law on which the licensee or other person 2

relies.

(c) An answer may consent to the entry of an order in substantially the form proposed in the demand to show cause.

(d) Uponreviewoftheanswerfiledpursuanttoparagraph(a)(2)ofthis section, or if no answer is filed, the Commission may institute a proceeding pursuant to 10 C.F.R. 2.202 to take the action proposed in the demand to show cause or to take such other action as may be proper.

5.

I 2.700 is revised to read as follows:

6 2.700 Scope of subpart.

The general rules in this subpart govern procedure in all adjudications initiated by the issuance of an order pursuant to i 2.202, an order pursuant to i 2.205(e), a I

e 5

-2,

I.. '; Q

• a g.

3 :

notice of hearing, a notice of proposed action issued pursuant to i 2.105, or a notice issued pursuant to i2.102(d)(3).

Dated at Rockville, Maryland, this day of 1990.

FOR THE NUCLEAR REGULATORY COMMISSION 1

Samuel J. Chilk Secretary of the Comission

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