ML20198L903

Forwards Commission Paper Final Rule, Deliberate Misconduct by Unlicensed Persons, & Change to NRC Enforcement Policy, Provided for Review & Transmittal to Commission

ML20198L903
Person / Time
Issue date:	10/06/1997
From:	Knapp M NRC OFFICE OF NUCLEAR REGULATORY RESEARCH (RES)
To:	Callan L NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO)
Shared Package
ML20198L674	List: ML20198L667 ML20198L765 ML20198L892 ML20198L903 ML20198L929 ML20198L965 ML20198L970 ML20198L985 ML20198L996 ML20198M005 ML20198M031 ML20198M042 ML20198M069 ML20198M084 ML20198M087 ML20198M097 ML20198M130 ML20198M136 ML20198M143 ML20198M160 ML20198M200 ML20198M221 ML20198Q028
References
FRN-57FR1890, FRN-63FR1890, RULE-PR-110, RULE-PR-150, RULE-PR-30, RULE-PR-32, RULE-PR-40, RULE-PR-50, RULE-PR-52, RULE-PR-60, RULE-PR-61, RULE-PR-70, RULE-PR-71, RULE-PR-72 AF35-2-011, AF35-2-11, NUDOCS 9801160146
Download: ML20198L903 (87)

Text

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UNITED STATES

!" Ij NUCLEAR REGULATORY COMMISSIEN W AsHINGToN, D.C. 20MH001

• % / October 6, 1997 MEMORANDUM TO: L. Joseph Callan Executive Director for Operations Of r Rose rch

SUBJECT:

FINAL RULE: DELIEEF. ATE MISCONDUCT BY UNLICENSED PERSONS (WITS 960007)

The attached Commission paper, Final rule, and change to the NRC Enforcement Policy are provided for your review and transmittal to the Commission, These documents discuss a number of changes to 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72,110 and 150 dealing with Deliberata Misconduct by unlicensed persons.

The proposed rule was published in the F _ ederal Realster on October 4,1990. The comment period ended on Decernber 18,1996. The Commission received six comments on the proposed rule, five in favor and one against. A summary of the comments and NRC's responses are discussed in the Statement of Consideration for the Final Rule.

The final rule amends the regulations by extending the scope of the Deliberate Misconduct rule to six new categories of persons: applicants for NRC licenses; applicants for, or holders of, certificates of cc'1pliance issued under 10 CFR Parts 71 and 72; applicants for, or holders of, early she permits, standard design certifications, or combined licenses for nuclear power plants issued under Part 52; applicants for, or holders of, certificates of registration issued under Parts 30 and 32: applicants for, or holders of, quality assurance program approvals issued under Part 71; and the employees, contractors, subcontractors and consultants of the above categories of persons, so that they may be subject to enforcement actior int deliberate violatica nt any of the Commission's requirements, in addition, the Office of Enforcement is submitting a change to the agency's Enforcement Policy to address enforcement actions against these categories of unlicensed persons. The Federal Register notice that amends NUREG 1600, " General Statement of Policy and Procedures for Enforcement Actions," to be published with the Final Rule, is Enclosure 2, to the Commission paper.

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t L. J. Callan 2  !

l Coordination:

The Offices of Administration, Neclear Reactor Regulation, Nuclear Material Safety and Safeguards, Enforcement, and State Fregrams concur in the Final Rule amendments. The t Chief Financial Officer has reviewed this Commission Paper for resource impacts and has no objections. The Chief Information Officer has reviewed this Commission Paper for  !

information technology and information management implications and concurs in it. The l

Office of the General Counsel has no legal objection to this Final Rule. l t

Attachment:

Commission Paper w/encis, t-1 i

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L. J. Collan ,

i Coordinatiom f The Offices of Administration, Nuclear Reactor Regulation, Nuclear Material Safety and l

Safeguards, Enforcement, and State Programs concur in the Final Rule amendments. The i Chief Financ!al Officer has reviewed this Commission Paper for resource impacts and has no objections. The Chief Information Officer has reviewed this Commission Paper for information technology and infortnation management implications and concurs in it. The Office of the General Counsel has no legal objection to this Final Rule. ,

Attachment:

Commission Paper w/encts.

DISTRIBUT.lON:

Central f/c WM8 s/f BMMorris PNorlan LRiani CGallagher DMendiola AThadenl, DEDE DOCUMENT NAME: 0:\DIPALO\DELMISCN\TRANS.MEM

'See previous concurrences D:DRA* 'l D,:RES OFC WMB:DRA* WMB:DRA* .

NAME ADiPalo: SBahadur JMurphy h pp '

DATE 09/29/97 09/29/97 10/01/97 /O /[/97 _

OFFICE RECORD COPY

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i FOR: The Commissioners FHOM: - L. Joseph Callan, Executive Director for Operations

SUBJECT:

FINAL RULE . DELIBERATE MISCONDUCT BY UNLICENSED PERSONS i PURPOSE:

To obtain Commission approval for publication of final amendments to 10 CFR Parn 30, l7 32,40,50,52,60,61,70,71,72,110 and 150 dealing with deliberate misconduct of unlicensed persons.  !

BACKGROUND:

In SECY 96-017, dated January 26,1996, the NRC staff informed the Commission of its plans to extend the Deliberate Misconduct Rule to certificate holders, and to applicants for licenses or certificates of compliance. The Commission, in an SRM dated February 8, 1996, advised the Executive Director for Operations (EDO) that it approved SECY 96-017 and had no objections to the proposed changes to the Deliberate Misconduct Rule found at 10 CFR 30.10, 40.10, 50.5, 60.11, 61.9b, 70.10, 72.12, and 110.7b. In developing this rulemaking, the staff extended the scope of the Deliberate Misconduct Rule to also cover '

applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants issued under 10 CFR Part 52; applicants for, or holders of, certificates of registration issued under Parts 30 and 32; and applicants for, or holders ,

of, quality assurance program approvals issued under Part 71 (including contractors, subcontractors and consultents of the above categories and employees of each of them).

In addition, the scope of 10 CFR 150.2 is being changed to provide similar notice to 7 persons conducting activities under reciprocity in areas of NRC jurisdiction.

CONTACT:

Tony DiPalo, DRA/RES NOTE: TO BE MADE PUBLICLY AVAILABLE (301) 415 6191 WHEN THE FINAL SRM IS MADE AVAILABl.E James Lieberman, OE '

(301) 415 2747 r f

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The Commissioners 2  :

The proposed rule was submitted to the Commission for approval (SECY 96184, dated August 20,1996) and publisF.ed in the federal Renister on October 4,1996 161 FR 51835). The comment period ended on December 18,1996. The Commission received 6 comments on the proposed rule. The Nuclear Energy Institute opposed issuance of the rule for allegedly being in excess of statutory auihority. Other commenters generally supportod the rule, but suggested limited changes.

A summary of the comments and NRC's responses are provided in the Statement of Coasideration for Final Rule (Enclosure 1).

DISCUSSlQ1f:

As a result of the staff's review of the public comments, no changes were made to the final vulo. Thus, the final rule revises the regulations to extend the scope of the Deliberate Misconduct Rule to six categories of persons. They are: (1) applicants for NRC licenses, under 10 CFR Parts 40,50,60,61,70 and 110; (2) applicants for, or holders of, certificates of compliance issued under 10 CFR Parts 71 and 72; (3) applicants for, or holders of, early site permits, standard design certifications, or comuned licenses for nuclear power plants issued under 10 CFR Part 52; (4) applicants for, or holders of, certificates of registration issued under 10 CFR Parts 30 and 32; (5) applicants for, or holders of, quality assurance program approvals issued undar 10 CFR Part 71; and (6) the employees, contractors, subcontractors and consultants of the first five categories of persons, so that they may be subject to enforcement action. In addition, the scope of 10 CFR 150.2 is being changed to provide similar notice to persons conducting activities under reciprocity in areas of NRC jurisdiction. These persons willinclude applicants for a license or certificate or quality assurance program approval and holders of a certificate or quality assurance program approval.

The staff does not believe that it is necessary to add the Deliberate Misconduct Rule to 10 CFR Part 54 because licensees applying to renew their operating licenses for nuclear power plants are already subject to this rule as licensees under 10 CFR Part 50. Similarly, the staff does not believe that it is necessary to add the Deliberate Misconduct Rule to 10 CFR Part 55 because applicants for, and holders of, reactor operators' licenses are already subject to this tule as employees of 10 CFR Part 50 licensees. Moreover, licensed operators are subject to all applicable Commission requirements (see 10 CFR 55.53 (d))

and thus a finding of deliberate misconduct is not required to take enforcement action against a licensed reactor operator.

As a result of adoption of this final rule, the NRC's Enforcement Policy needs to be amender'- Me proposed revisions are described in the enclosed Federal Register notice (Enclosurt The revision would be effective concurrently with these amendments to the regulations. They will also be reflected in the next revision to NUREG-1600, " General Statement of Policy and Procedures for NRC Enforcement Action." As these omendments address the terminology used in referring to various unlicensed entities, e.g., contractors, vendors, it is appropriate to modify all existing references to vendors to conform to the Commission's holding in Five Star Products. Inc. and Construction Products Research. Inc..

38 NRC 169, CLI-93 23, that the term "contrcctor" includes vendor. These changos are reflected in the Federal Register notice. During the final stage of this rulemaking, it was

The Commissioners 3 recognized that the Deliberate Misconduct Rule, by its terms, does not expressly cover persons who conduct activities that require an NRC license but do oct hold a license, i.e.,

using material without a license. The staff is of the view that the Rule covers those persons, it intends to take action to clarify this matter.

COORDINATION:

The Office of the General Counse' has no legal objection to this Final Rule. The Of fice of '

the Chief Information Officer has reviewed this Commission Paper for information -

technology and iaformation management implications and concurs in it. The Office of the Chief Financial Offic sr has reviewed this Corrmission Paper for resource impacts and has no objections.

RECOMMENDATIOE:

That the Commission:

1. A_pplgy!! publication in the Ee.deral Reaister of the notices of the attached Final Rulemaking (Enclosure 1) and revision to the NRC Enforcement Policy (Enclosure 2).

2. In order (3 satisfy the requirements of the Regulatory Flexibility Act, S U.S.C.

605(b), certify that this rule, if promu! gated, will not have e *ighificant economic impact on a substantial number of sraall entities. This corti'i.ation is included in the enclosed Federal Register notice.

3. Ugle:

a. The Regulatory Analysis has been included in the Federal Reaister notice.

b. The appropriate Congressional committees will be informed (Enclosure 3),

c. A public announcement will be issued by the Office of Public Aff airs when the final rulemaking is filed with the Office of the Federal Register (Enclosure 4),

d. The Chiaf Counsel for Advocacy of the Small Business Administration will be informed of the certification regarding economic impact on small entities and the reasons, as rcluired by the Regulatory Flexibility Act.

e. The final rule does not contain any new or amended information collection requirements subject to the Paperwork Reduction Act of 1995 (44 U.S.C.

3501, et sag.).

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4 The Commissioners

f. The staff has determined that this is not a " major" rule as defined in the Small Business Regulatory Enforcement Fairness Act of 1996,5 U.S.C.

804(2), and has confirmed this determination with the Office of Management and Budget. The appropriate Congressional and GAO contacts will be informed (Enclosure 5). l 1

L. Joseph Callan '

Executive Directo-for Operations

Enclosures:

As stated (5) f I

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4 The Commissioners  :

f. The staff has determined that this is not a " major" rule as defined in the ,

Small Business Regulatory Enforcement Fairness Act of 1996,5 U.S.C.

804(2), and has confirmed this determination is with the Office of t Management and Budget. The appropriate Congressional and GAO contacts will be informed (Enclosure 5).

I L. Joseph Callan '

Executive Director for Operations

Enclosures:

As stated 6) ,

RECORD NOTE: A copy of the final rule was sent to OlG for information on: Auaust 14,1997.

DISTRIBUTION:

Central f/c EDO r/f ACThadani, DEDE WM8 r/f PNorlan BMMorris FCostanzl CAGallagher LBRiani DMendiola "C" = Copy without attachment / enclosure To receive a copy of this document, indicate in the box:

"E" = Copy with attachment / enclosure N" = No copy

'See previous concurrences DOCUMENT NAME:onDIPALO\DELMiscN\DMC-CoM.OR2 o:OE' ADM' CFo' WMB:DRA - D:DRA o:oSP' ,

OFC WMB:DRA RLBangert Jueberman DMeyer/ JLFunches SBahadur' JAMurphy' by e mail NAME ADiPalo' by e mail by memo EHalman

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09/30/97 08/28/97 08/25/97 08/05/97 09/11/97 m DATE 07/28/97 07/31/97 WEM MIM M M m m m m EMI M ME m D:NRR' D:RES EDo OFC NMSS' Clo' ooc' (RM' SColhns LJCallan AJoelante by - Wolmstead BJShelton NAME- CPaperiello JRoe memo by memo - by memo

by Kane ' memo memo 08/26/97 08/28/97 [h/ hS7 //97 08/29'97 08/26/97 10/02/97 DATE' OFFICIAL REC.ORD COf'Y (RES File Codel RES i

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l f ENCLOSURE 1 FEDERAL REGISTER NOTICES CINCLUDES STATEMENT OF CONSIDERATION: 1 1

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i NUCLEAR REGULATORY COMMISSION 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72.110, and 150 RIN: 3150-AF35 l Deliberate Misconduct by Unlicensed Persons AGENCY: Nuclear Regulatory Commission.

.i ACTION: Final rule.

SUMMARY

The Nuclear Regulatory Commission (NRC) is amending its regulations to  :

extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, or holders of, certificates of compliance; applicants for, or holders  ;

of, ear;i alte permits, standard design certifications, or combined licenses for nuclear power plants; applicants for, or holders of, certificates of registration; applicAts for, or i holders of, quality assurance program approvals; and the employees, co1 tractors, , f subcontractors and consultants of the above five categories of pertens, so that they may be subject to enforcement action for deliberate misconduct. Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, cert!!icate holder, or applicant to be in violation of any of the Commission's requirements.

EFFECTIVE DATE:

This final rule is effective on (insert 30 days from date of publication in l

l the Federal Register) i s

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FOR FURTHER INFORMATION CONTACT: Tony DiPalo, Office of Nuclear Regulatory Research, U.S. Nuclear Regulatory Commission, Washington, DC 20555 0001, telephone (301) 415-6191, e mail, ald@nre. gov.

SUPPLEMENTARY INFORMATION:

Backgrou1d On August # 5,1991 (56 FR 40664), the Commission adopted changes to NRC regulations that established the Deliberate Misconduct Rule found at 10 CFR 30.10, 40.10, 50.5, 60.11, 61,9b, 70.10, 72.12, end 110.7b, which applies to any licent,ee or any employee of a licensee; and any contractor (bcluding a supplier or consultant),

subcontractor, or any employee of a contractor or subcontractor, of any licensee, in addition,10 CFR 150.2, Scope, provides notice to persons conducting activities under reciprocity in areas of NFC lurisdiction that they are subject to the rule (ggg 10 CFR 150.20, Recognition of Agreement State licenses). The Deliberate Misconduct Rule placed licensed and unlicensed persons on notice that they may be subject to enforcement action for deliberate misconduct that causes or would have caused, if not detected, a licensee to be in violation of any of the Commission's requirements, or for deliberately providing to the NRC, a licensee, or contractor, information that is incomplete or inaccurate in some respect materic1 to the NRC.

Currently, the Deliberate Misconduct Rule does not apply to:

. (1) Applicants for NRC licenses; 2

. . . _ . . _ . . _ _ _ _ ._ ._ _ _ _ _ _ . _ . _ _ _ _ _ _ = _ _ . . _ - . . _ _ . . . _ _ . . _ _

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.. j (2) Applicants for, or holders of, certificates of compliance issued under 10 CFR f i

- Parts 71 9d 72, including those for dry cask storage; t j

(3) Applicants for, or holders of, early site permits, standard design certifications, j

or combined licenses for nuclear power plants issued under 10 CFR Part 52; i (4) Applicants fer, or holders of, certificates of registration issued under Parts 30 t

and 32;.  !

(5) Applien,ts for, or holders of, quality assu*ance program approvals issued under r

Part 71; and t

(6) The employees, coritr9ctors, subcontractors and consultante of the first five t categories of persons, f

To ensure that these persons are subject to etiforcement action for wrongdoing i

under the Deliberate Misconduct Rule, on October 4,1996 the NRC issued a proposed rule f

to extend the rule to them (61 FR 51835). This final rule will also add the Deliberate i Misconduct Rule to 10 CFR Parts 52 and 71 where it currently does not appear.

i The staff does not believe that it is necessary to add the Deliberate Misconduct l

.i Rule to 10 CFR Part 54 because licensees applying to renew their operating licenses for i nuclear power plants are already subject to this rule as licensees under 10 CFR Part 50. l Similarly, the staff does not believe that it is necessary to add the Deliberate Misconouct Rule to 10 CFR Part 55 because applicants for, and holders of, reactor operators' licenses 1 are already subject to this rule as employees of 10 CFR Par't 50 licensees. Moreover, ,

licensed operators are subject to all applicable Commission requirements (see 10 CFR  !

1

-.55.53 (d)) and thus a finding of deliberate misconduct is not required to take enforcement i

action against a licensed reactor operator.

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Discussion - l i

i-it is important that allinformation provided to the NRC be complete and accurate in all material respects. Section 186 of the Atomic Energy Act of 1954, as amended (AEA),  ;

underscores this need by providing that "lallicense may be revoked for atey material false statement in the application or any statement of f act required (by statute or regulation)

. . . " The Commission has promulgated rules conc *ing comp'ateness and accuracy of i

information that specifically apply to information provided to the Commission by a licensee or an applicant for a license (see 10 CFR 30.9(a),40.9(a),50.9(a),60.10(a),61.9ala),

- 70.9(a),-71.at,72.11(a),76.9(a) and 110.7ala)). Similarly, subsection (b) of each of

-i these sections, which deals with notification to the Commission of significant safety j e

1 j

information, refers to applicants as well as licensees. Violation of these provisions can result in denial of the license application, civil enforcement action against a licensee, or, if i

appropriate, referral to the Department of Justice for consideration for criminal i

prosecution.

The Deliberate Misconduct Rule permits the NRC to take individual action, such as  ;

issuing an order, against an individual who deliberately provides information that the individual knows to be incomplete or inaccurate. However, when the Deliberate l Misconduct Rule was promulgated, it did not address applicants for licenses; applicants ,

for, and holders of, certificates of compliance or certificates of registration; applicants for, and holders of, early site permits, certified designs and combined licenses; and applicants for, and holders of, quality assurance program approvals, and their employees, and contractors and consultants, and their employees.

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Incomplete or inaccurate information has potential safety significance, whether f submitted before or af ter a license, certificatei permit, or approval has been issued. The Commission has clearly emphasized the importance of applications containing accurate t l

information; e.g., "lThe Commissioni cannot overstate the importance of a licensee's or an l

applicant's duty to provide the Commission with accurate information." Randell C. Orem.  !

D&u CLl 9314,37 NRC 423 (1993). The Oterri case involved a consultant to an applicant for a lict isHho provided inaccurate infctmation that was included in the  !

license application and the Commission found that information as to the strus of the i l

f acility was material to the licensing decision. {d. at 428.  !

The Commission believes that there may be significant safety consequences from the deliberate submission of f alse or incomplete information or other deliberate wrongdoing l

by an applicant for a license or other unlicensed persons covered by this modification to ,

the Deliberate Misconduct Rule. For example, a quality assurance program that is i submitted to the NRC for approval but is supported by deliberately f alsified data that mask i

a significant defect could be a public health and safety threat. Under the present Deliberate Misconduct Rule, a certificate holder who obtained a certificate by deliberate ,

submittal of f also information could escape individual NRC enforcement action because the deliberate misconduct may not have put an "NRC licensee" in violation. To effectively exercise its authority under the AEA, the Commission needs to prevent or otherwise dete.

the deliberate submittal of materially f alse or inaccurate information by those entities not i

currently covered by the rule. The NRC knows of no reason why the rule should not apply to persons who deliberately submit materially incomplete or inaccurate information, f

.whether such submittalis by or on behalf of an applicant, or by or on behalf of a holder o -

a license,~ certificate, permit or approval.

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The Commission is amending the Deliberate Misconduct Rule each place it appears f

'I, in 10 CFR Chapter i to make the rule' apply to applicants for NRC licenses; to applicants for, and holders of, certificates of compliance issued under 10 CFR Parts 71 and 72; to' applicants for, and holders of, early site permits, certified designs, and combined licenses for nuclear power plants issued under 10 CFR Part 52; to applicants for, and holders of, j certificates of registration issued under Parts 30 and 32; and to applicants for, and holders l of, qualit/_ assurar ce program approvals issued undst Part 71; and to the employ tes, l

contractors, subcontractors and consultants of all the above categories of persons. This i would include, for example, a consultant engaged by an applicant to prepare a license application for such activities as radiography, welllogging, irradiation, and teletherapy. It would also apply to a consultant preparing an application for a certificate for a spent fuel The  !

cask, or individuals conducting performance tests to support such an application.  !

amendments to the Deliberate Misconduct Rule will appear in 10 CFR 30.10,40.10,50.5, 60,11,61.9b,70.10,72,12, and 110.7b. Section 71.11 is being added to incorporate  !

the rule in 10 CFR Part 71 and 10 CFR 52.10 is being added to incorporate the rule in 10 CFR Part 52. In addition,10 CFR 150.2 and 10 CFR 32.1(b) are being revised to incorporate the proposed changes. Also, the scope provisions found in 10 CFR 30.1,

' 40.2, 50.1, 52.1, 60.1, 61.1(c), 70.2, 71.0, 72.2, and 110.1(a) are being modified to reflect these revisions to the rule. The Commission is also making a minor language I change to improve readability by altering the phrase "but for detection" to "if not J detected" where the phrase appears in each rule, but intends no substantive change by _

this revision.1 having this enforcement authority available will help the NRC pursue redress in cases of deliberate misconduct by unlicensed persons acting within the scope of the- i

) _

, Commission's jurisdiction and may deter such behavior as well.

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i This rulemaking extending the Deliberate Misconduct Rule to applicants for NRC licenses; applicants for, and holders of, certificates of compliance issued under 10 CFR Parts 71 and 72; applicants for, and holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants issued under 10 CFR Part 52; n'iplicants for, and holders of, certificates of registration issued under Parts 30 and 32; l and applicants for, and holders of, quality assurance program approvals issued under  ;

Part 71; and to tiu emp!( yees, contractors, subcon:ractors and consultants of all .he above categories of persons, implements the Commission's authority under the AEA to  :

issue regulations and orders to any person (defined in Section 11s of the AEA to include, e.g., an individual, corporation, firm, or a Federal, State, or local agency) who engages in conduct affecting activities within the Commission's subject matter jurisdiction, in brief, Section 1611 of the AEA provides broad authority to issue regulations and orders as the Commission deems necessary to govern any activity authorized pursuant to the AEA in order to protect public health and safety. Section 161b of the AEA similarly authorizes the Commission to issue regulations and orders to impose " standards and instructions" on persons to govern the possession and use of special nuclear material, source material, and byproduct material, as may be necessary or desirable to provide for the common defense and security and protect public health and safety. Section 234 of the AEA authorizes the NRC to impose civil penalties on certain unlicensed persons for violating the NRC's substantive requirements. Section 234a of the AEA reads as follows:

- Any person who (1) violates any licensing or certification provision of Sections 53, 57, 62, 63, 81, 82,101,103,104,107,109, or 1701 or any rule, regulation, or order issued thereunder, or any term, condition, or limitation of any license or

' certification issued thereunder, or (2) commits any violation for which a license may be revoked under Section 186, shall be subject to a (,ivil penalty, to be imposed by the Commission, of not to exceed $100,000 for each such violation.

7

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.O.

• The licensing provisions listed in Section 234a generally prohibit the possession, use, receipt, or transfer of nuclear materials or f acilities unless authorized by and in accord I

with a license.

l The amendments are made under the authority of sections 161b and i and the above identified licensing provisleas in Section 234. The changes apply to any person in the categories enumerated above who engages in deliberate misconduct, or who  ;

deliberatel/ t ubmits ,1attirially incomplete or inaccurrite information, as provided in the l

rule. By imposing a direct prohibition on unlicensed persons, the Commission may:

i to exercise its Section 234 authority to impose civil penalties on unlicensed persons when i 1

thc. deliberately cause violations of requirements issued under the licensing provisions I enumerated in Section 234. In cases when the Commission issues an oI order imposing a civil penalty) to a person based on deliberate miscor%ct, the order  :

would be issued in part pursuant to a regulation (e.g.,10 CFR 30.10) that was .

promulgated under a licensing provision of the AEA. A civil penalty could be ava violations of such an order. In addition, criminal sanctions under Section 223 of the AEA l

are available for willful violations of orders and regulations issued under sections 161b and I injunctions are also available under Section 232 of the AEA for violations of i Commission orders.

Summary of Public Comments On December 18,1996, the comment period for the proposed amendrnents to the

-Deliberate Misconduct Rule closed.- The NRC received 6 comments on the proposed ru

. which are addressed below. One comment, in addition to favoring speedy adoption of the

~8 j

t proposed rule, requested information on the status of NRC enforcement cases ag:; inst ,

certain dry cask storage vendcis which the NRC views to be outside the scope of this proposed rulemaking. Copies of the public comments are available in the NRC Public Document Room,2120 L Street, NW. (Lower Level), Washington, DC. A summary of the .

comments it, provided below. .

One utility commonter war concerned that the proposed revisions to the Comrnent:

rule did not address preliminary or "for information only" information that may be sent to the NRC staff. This commenter believed that situations could arise where licen provide information to the NRC staff to support teleconferences or meetings and wher the information is considered to be preliminary and subject to change over time, in these cases, the commenter believed preliminary information should not be construed as intended to be complete and the conclusion reached that deliberate misconduct occurre A second issue raised by this commenter pertained to how potentially erroneous information in a staff Safety Evaluation Report could result in a conclusion reached by th NRC staff that since this erroneous information is inconsistent with that provided in the hconsee's submittal, the licensee committed willful misconduct.

Resoonse:

The NRC's completeness and accuracy rules require that allinformation provided to the Commission shall be complete and accurate in all material respects (10 CFR 30.'), 40.9. 50.9, etc.). The deliberate submission of information which is incompinte or inaccurate in material respects, where the submitter of the information knows of the incompleteness or inaccuracy, may be considered deliberate misconduct.

However, the subrnission of information acknowledged to be incomplete would not be best

. considered deliberate misconduct if it is made in good f aith and based on the 9

d 4 dditionalinformation or cnalysis.

information available, but is corrected later based on a The NRC's General Statement of Policy and Procedures for Enforcement Actions (NU 1600) (Enforcement Policy) points out that a citation is not made if an initial 0 bmittal w accurate when made but later turns out to be erroneous because of newly discovered information or advances in technology. Also, the Commission recognizes that oral information may in some situations be less reliable. This is addressed in Section IX o Enforcement Policy.

Finally, the Commission does not take lightly its responsibility in this area and carefu'ly consider > each action inwivhg an individual. As the Commission stated in original Deliberate Misconduct Rule:

"It would be an erroneous reading of the final rule on deliberate misconduct to conclude that conscientious people may be subject to personalliability for mistakes.

Commisolon realizes that people may make mistakes while acting in good f aith.

Enforcement actions directly against individuals are not to be used for activities caus merely negligent conduct. These persons should have no fear of individual liability this regulation, as the rule requires that there be deliberate misconduct before the sanctions may be imposed. The Commission recognizes, ... that enforcement actions involving individuals are significant actions that need to be closely controlled end judiciously applied." (See 56 FR 40664,40681)

Comment: One commenter, the Nuclear Energy Institute (NEI), believes that the h AEA)

.NRC is exceeding its statutory authority under the Atomic Energy Act of 1954 (t e in promulgating these amendments to the Deliberate Misconduct Rule because,in th of NEl, authority over non licensee persons was not provided by Congress other J an in 10 t 1

limited circumstances carved out in the AEA as exceptions, in particular, NEl believes that Section 161i(3) of the AEA does not provide jurisdiction over non licensee persons because it does not contain the operative phrase "any person" and therefore, NElimplies, is confined to licensees. NEl recognizes that deliberstely provided misinformation or other deliberate misconduct could have a very serious ef fect on public health and safety and thus needs to be deterred. However, in the view of NEl,18 U.S.C. I 1001, the general criminal statute tpplicable to the Federal government and its agencies, provides an adequate deterrent to the wrongdoers NRC i,eeks to capture in this rulemaking.

Besoqan: The Commission cor.sidered, but rejected, the objection that it did not have jurisdiction over non-licensees et the time it issued the original Deliberate Miscond Rule. See 56 FR 40664, (1991). As the Commission stated: i in enacting Section 161 of the 1954 Act, Congress conferred uniquely broad and flexible authority on the Commission. Specifically, Congress autharitod the Commission in Section 161 to ' prescribe such * *

• regulations * *

• as it may deem necessary to govern sny activity authorized pursuant to [the 1954 Act),in order to protect health and minimize danger to fife and property.'

With respect to the absence of specific provisions setting forth the limits of the NRC's personal jurisdiction, the Commission stated at 56 FR 40666 - 40667:

Where Congress does not include statutory provisions governing 10 oersonarn jurisdiction, it is appropriate to look to the scope of subject matter jurisdiction in order to determine the scope of 10 cersonam jurisdiction. Since Congress did not include any specific personal jurisdiction provisions in the 1954 Act, or any limitations on such jurisdiction, the NRC is authorized to assert ;ts personal jurisdiction over persons based on the maximum limits of its subject matter jurisdiction. The agency's personal jurisdiction is established when a person acts within the agency's subject matter jurisdiction. * *

• The persons who are being brought within the scope of the Deliberate Misconduct Rule in these amendments are all persons who, in some way, engage in activities within NRC's subject matter 11 h _

jurisdiction. Thus, the Commission discerns no statutory prohibition on making these persons subject to the restrictions of the Deliberate Misconduct Rule.

NEl also contends that the Deliberate Misconduct Rule and these amtadments are not needed because an adequate deterrent and remedy is provided by 18 U.S.C. I 1001.

This statute allows the imposition of criminal penalties for persons who, inigt pjig, knowingly and willfully make f also statements to an agency of the Federal Government.

There are several reasons why this enforcement option is not an adequate substitute for the Daliberate Misconduct Rule. First,18 U.S.C. I 1001 punishes deliberate f also statements but does not cover the types of deliberate misconduct captured by Section of the rule. Second, the civil enforcement penalties available to the NRC for violations o its rule, precisely because they are less drastic than criminal penaltics, are more flexibl end, thus, are more likely to be used in appropriate cases, affording the NRC greater to deter and remedy deliberate misconduct.

Comment: NEl also commented that one of the rule's standards for enforcement action - knowingly providing incomplete or inaccurate information which is "in some respect material to the NRC" - is overly broad. This standard appears to permit the to take enforcement action whether or not a violation of NRC regulations has occurred or ,

would have occurred but for detection. This breadth of scope results in the standard not being sufficient;y clear to inform the public of the elements of the prohibited action.

The Commission disagrees with the commenter's assertion that the rule

-R

_ es00nse:

is ovetly broad. The rule specifies that the persons who are delineated as being subjec the rule mustnh. owinalv orovide components, materials or other goods and services that relate to, e.g., a licensee's or certificate holder's activities subject to NRC regulation. ,

12

Such persons, therefore, know that they are acting in an area that relates to activities within NRC's regulatory jurisdiction. As the Commission said with respect to a similar comment objecting to the or;ginal Deliberate Misconduct Rule, "a person with the requisite knowledge who deliberately provides f also or inaccurate information that is material to the NRC presents a health and safety concern within the NRC's regulatory sphere." 56 FR 40070. The f act that no actual violation has occurred, or would have occurred but for detection, has nc bemi)g on whether, from a health and safety standpoint, that person should be involved in nuclear activities. Although, the commenter is correct that the standard permits the NRC to take enforcement action whether or not a violation has occurred, or would have occurred but for detection, the Commission does not believe that this f act renders the standard overly broad.

Comment: One commenter, the JAl Corporation, proposed that the scope of the proposed rule be broadened to !nclude persons submitting information pursuant to the notification requirements of 10 CFR Part 21. The commenter, apparently believing that such persons are not presently covered by the Deliberate Misconduct Rule, pointed to the unf airness that would exist if persons who knowingly submit incomplete or inaccurate information to licensees are penalized but persons who knowingly submit incomplete or inaccurate information to the NRC regarding defects or non compliance under Part 21 are not penalized.

Under 10 CFR Part 21, certain types of persons, e.g., individual finoonse:

directors or responsible officers of a corporation, must notify the NRC when they cbtain certain types of information; e.g., information concerning defects in components which could cause a substantial safety hazard. When such persons provide information to the 13 y - ~

O o

NRC they are subject to the Deliberate Misconduct Rule as it appears in the relevant Part of Chapter i of 10 CFR. For example, if the director of a corporation obtains information indicating a f ailure to comply or a defect affecting a basic component that is supplied for a nuclear power plant subject to 10 CFR Part 50, the director is subject to the Deliberate Misconduct Rule as it appears in Part 50 (10 CFR 50.5) when reporting this f ailure to comply or defect to the NRC. Further, the Deliberate Misconduct Rule makes no distinction betwe en deliberately submitting information known to be incomplete or inaccurate to the NRC and submitting the same information to a licensee, or to a licensee's contractor or subcontractor. Thus, the regulations do not countenance the disparity of treatment envisioned by the commenter.

_ Comment: One commenter, a source production and equipment company, <

supported the proposed rule but also recommended that the rule be revised to specifically apply to the persons who maintain the equipment malfunction records that are required by the Quality Control and Quality Assurance (OA/OC) programs which are required under 10 CFR Part 32 for the manufactufe and distribution of radiography equipment. The commenter recognizes that because Mece records are not part of the Quality Assurance program itself, they are not submitted to the NRC as part of a registration certificate application. Nevertheless, the commenter believes that the accuracy and integrity of these records are essential for the OA/OC program to be effective and thus the Deliberate Misconduct Rule should apply to persons who maintain equipment malfunction records for certificate holders.

Response: The Deliberate Misconduct Rule is being made applicable w certificate

- holders and applicants, and to their employees, contractors and subcontractor's, not only 14 F

T r --

e, When they deliberately submit information to the NRC, but also when they deliberately submit to a certificate of registration holder or applicant, or a certificate holder's or e

applicant's contractor or subcontractor, information that the person submitting the information knows to be incomplete or inaccurate in some respect material to the NRC.

Thus, for example, an employee or contractor of a certificate of registration holder responsible for maintaining equipment malfunction records who knowing ly submits incomplete or inaccurate information to the certificate of registration holder violates the Deliberate Misconduct Rule if the information submitted is in some respect material to the NRC. However, in the absence of a requirement for maintenance of equipment malfunction records, a person generating an inaccurate or incomplete equipment malfunction record is not subject to the Deliberate Misconduct Rule unless and until these records are actually submitted to one of the persons covered by section a(2) of the rule.

Comment: Orse commenter, while agreeing with the proposed rule, did not see why amendment of the Deliberate Misconduct Rule is necessary with respect to Part 72 certificate holders and their contractors and subcontractors because, in the view of the commenter, the rule presently encompasses the contractors and subcontractors of licensees and certificate holders are contractors to licensees and thus are covered by the rule as it now exists.

Eg1ponse: Insof ar as certificate holders are contractors to licensees (and certificate holders' contractors and subcontractors are subcontractors to licensees), the commenter is correct. Those certificate holders, and their contractors and subcontractors, are covered by the present rule. However, the NRC doe: not require the existence of a contract as a prerequisite to the issu'ence of a Certificate of Compliance (sin 72.236; 72.238). Thus, it i

15

-l

, . I is possible for a certificate holder not to be a contractor to a licensee. The amended rule i i

will cover those certificate holders, i

Criminal Penalties i

i For purposes of Section 223 of the' Atomic Energy Act (AEA), the Commission is ,

ilssuing the flial rule : ndr-r one or more of sections 101b,1611 or 161o of the AEA. t Willful violations of the rule will be subject to criminal enforcement.

Environmental impact: Categorical Exclusion I

The NRC has determined that this final rule relates to enforcement matters and, therefore, f alls within the scope of 10 CFR 51,10(d). Therefore, neither an environmental" impact statement nor an environmental assessment has been prepared for this final rule.

Paperwork Reduction Act Statement F

o This final rule does not contain a new or amended information collection  ;

requirement subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.), t Existing requirements were approved by the Office of Management and Budget, approval numbers 3150-0017, 3150-0151, 3150-0127 3150-0135, 3150 0009. 3150 0132, 3150-O0' 38, and 3150 0032.

16

o 4

Public Protection Notification Trie NRC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

P Compatibility of Agreement State Regulations The Commission did not make the original Deliberate Misconduct Rule and the supporting enforcement guidance a matter of Agreement State compatibility. However, in the intervening period, the Commission has re-examined its compatibility policy and issued two new policy statements which establish principles for determining the degree of compatibility expected between NRC and Agreement State regulations: " Statement of Principles and Policy for the Agreement State Pro 0 ram," and " Policy Statement cn Adequacy and Compatibility of Agreement State Programs," (62 FR 46517). The NRC staff, in conjunction with the Joint NRC-Agreement State Adequacy and Compatibility Working Group, re-evaluated the compatibility categorir.ition of 10 CFR 30.10,40.10 and 70.10 and recommended that these deliberate misconduct requirements be required for compatibility under Category C of the new Policy Statement. Under Category C, Agreement States would have to adopt the essential objectivcs of these requirements to avoid conflicts, duplications or gaps between the NRC and Agreement State Programs.

The Commission has approved staff's plan to provide an opportunity for the Agreement States and the public to comment on this and other recommendations. After receipt,,Ind resolution of comments, the staff will submit final recommendations to the Commission for approval.

17

o Regulatory Analysis The Nu lear Regulatory Commission has statutory authority to issue enforcement actions against unlicensed persons whose deliberate misconduct causes a licensee or a certificate holder or an applicant for a !icense or certificate to be in violation of the Commission's requirements. On August $ 5,1991 (56 FR 40664), the NRC promulgated the Deliberate Misconduct Rule which put license; and unlicensed persons on ne'ic1 that if not they may be subject to enforcement action for deliberate misconduct that cau.v -

detected, would cause a licensae to be in violation of any of the Commission's requirements or for deliberately providing to the NRC, a licensee or a contractor information that is incomplete or inaccurate in some respect material to the NRC.

However, the Deliberate Misconduct Rule does not specifically apply to: (1) applicants for NRC licenses, (2) applicants for, and holders of, certificates of compliance issued under Parts 71 and 72, (3) applicants for, and holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants issued under Part 52, (4) applicants for, and holders of, certificates of registration issued under Parts 30 and 32, (5) applicants for, and holders of, quality assurance program approvals issued under Part 71, and (6) the employees, contractors, subcontractors and consultants of the first five categories of persons.

On November 29,1991, the NRC staff issued an Order Revoking License to Dr. Randall C. Orem after the NRC staff learned that information in his license application T

was f also and that the application had been prepared by a consultant who had provided-In this the f alu information. !Lqn Randall C; Orem. D.O., CLI-93-14, 37 NRC 423 (1993).

k case, the NRC staff realized that under the provisions of the existing Deliberate 18

4 Misconduct Rule, it was onable to take additional enforcement action against Dr. Orem and was precluded from taking enforcement action against the consultant because the consuitant was working for an applicant rather than for a licensee. Subsequently, the Commission realized that other categories of persons within the Commission's jurisdiction had not been explicitly included within the Deliberate Misconduct Rule; e.g., certificate holders under 10 CFR Parts 71 and 72 and holders of early site permits, certified design certifications and combined licenses under 10 CFR Part 52.

The Commission believes that there may be significant safety consequences from the deliberate submission of f also or incomplete information or other deliberate wrongdoing by an applicant for a license or other unlicensed persons proposed to be covered by this modification to the Deliberate Misconduct Rule. For example, a spent fuel storage cask that is certified by the NRC on the basis of f alsified test data could represent a threat to public health and safety. Similarly, a quality assurance program that is submitted to the NRC for approval, but is supported by deliberately f alsified data that mask a significant defect, could also be a public health and safety threat. Because the potential for injury is serious, the NRC knows no reason why the Deliberate Misconduct Rule should not apply to persons who deliberately submit materially incomplete or inaccurats information, whether that submittalis by or on behalf of an applicant, or by or on behalf of a holder of a license, certificato, permit or arsroval.

The objective of the rule ;a to explicitly put those persons encompassed by this modification of the Deliberate Misconduct Rule on notice that enforcement action may be taken against them for deliberate misconduct or deliberate submission of incomplete or inaccurate information, in relation to NRC licensed activities. Under Section 234 of the Atomic Energy Act, the Commission may impose civil penalties on any person who 19

violates any rule, regulation; or order issued under any one of the enumerated provisions of the .Act, or who commits a violation for which a license may be revoked. The enforcement j

actions that may be taken, including orders limiting activities of wrongdoers in the' future

and civil penalties, will serve as a deterrent to others'throughout the industry.

The alternatives available to'he Commission are to promulgate a modification of the Deliberate Misconduct Rule, as is proposed herein, or do nothing. Given the fact th'at a

- case has already occurred where the Commissicin *ms precluAd from taking appropriate enforcement action against a consultant to an applicant, and the potential harm to the public, the alternative of doing nothing was rejected. The benefits of taking enforcement

~

action are similar to those of taking action against licensed entities in that a civil penalty and attendant adverse publicity encourage future compliance, the Notics of Violation calls lfor a precise response as to ;orrective action taken, and an enforcement order, if obeyed, ,

will directly control the involvernent of an individual in a licensed activity. The effect of

~

having these options available in the enforcement program should reduce the probability of repetitive violations by wrongdoers.

The NRC does not anticipate that additionalinvestigations will be necessary to implement the rule because it focuses on the results of investigations. Based on experience, the NRC expects fewer than 10 additional cases per year to result in ,

enforcement action being taken against unlicensed individuals. The cost of preparing and publishing the additional actions beyond the current workload is not significant.

' The rule constitutes the preferred course of action and the cost involved in its promulgation and application is necessary and appropriate. The foregoing discussion i:

- constitutes the. regulatory analysis for this rule. ,

20 Wv' -

'm.- r,,, ---

y , + ~ - - - 4

- - .~ - ..

Regulatory Flexibility Certification in accordance with the Regulatory Flexibility Act of 1980,5 U.S.C. 605(b), the Commission certifies that this final rule, if adopted, will not have a significant economic impact on a substantial number of small entities. The final rule would put: (1) applicants for NRC licenses; (2) applicants for, and holders of, certificates of compliance issued under 10 CFR Parts 71 and 72, including those for dry cask storage; (3) applicants for, and holders of, early site permits, standard design certifications, or combined licenses issued under 10 CFR Part 52; (4) applicants for, and holders of, certificates of registration issued under 10 CFR Parts 30 and 32; (5) applicants for, and holders of, quality assurance program approvals issued under 10 CFR Part 71; and (6) the employees, contractors, subcontractors and consultants of the first five categories of persons on notice ' hat they are subject to the Deliberate Miscond ict Rule and, therefore, are subject to civil enforcement action if they deliberately cause a licer see, certificate holder, or an applicant .

for a license or certificate to be in violation of NRC requirements. The fir:al rule does not impose any additional obligations on entides that may fall within the definition of "small entities" as set forth in Section 601(6) of the Regulatory Flexibility Act; or within the definition of "small business" as found in Section 3 of the Small Business Act,15 U.S.C.

632; or within the size standards adopted by the NRC on April 11,1995 (60 FR 18344).

Small Business Regulatory Enforcement Fairness Act in accordance with the Small Business Regulatory Enforcement Fairness Act of 1996,' the NRC has determined that this action is not "a major" rule and has verified this 21

determination with the Office of information and Regulatory Affairs, Office of Management and Budget.

Backfit Analysis The NRC has determined that the backfit rule,10 CFR 50.109, does not apply to this final rule and, therefore, a backfit analysis is not reqtired for this final rule i scause these amendments do not involve any provisions that would impose backfits as defined in 10 CFR 50.109(a)(1).

Enforcement Policy Concurrently with publication of the Deliberate Misconduct Final Rule, the Commission is publishing modifications to NUREG-1600, " General Statement of Policy and Procedure for NRC Enforcement Actions," to address enforcement action against the categories of unlicensed persons listed under this Final Rule.

List of Subjects 10 CFR Part 30 Byproduct material, Criminal penalties, Government contracts, Intergovernmental relations, Isotopes, Nuclear materials, Radiation protection, Reporting and recordkeeping requirements.

22

.e .e 10 CFR Part 32 -

Byproduct material, Criminal penalties, Nuclear materials, Labeli ng, Radiation-1

.protectionf Reporting and recordkeeping requirements.

4 i

10 CFR Part 40:

Criminal penalties, Government contracts, Hazardous materials transportation, j Nuclear materia's,Gef rting and recordkeeping reouirements, Source material, Uranium. -  ;

. :10 CFR Part 50_

~ Antitrust, Classified information, Criminal penalties, Fire protection, ,

intergovernmental relations, Nuclear power plants and reactors, Radiation protection, i

Reactor siting criteria, Reporting and recordkee' ping requirements, 10 CFR Part 52 -

Administrativo practice and procedure, Antitrust, Backfitting, Combined license,. . ,

Early site permit. Emergmcy planning, Fees, Ir-ction, Limited work authorization, Nuclear power plants and reactors, Probabilistic risk assessment, Prototype, Reactor siting criteria, Redress of sitei Reporting and recordkeeping requirements, Standard design,

.' Standard design certification.

10 CFR Part 601

-- Criminal penalties, High-level waste, Nuclear power plants and reactors, Nuclear--

? materials, Reporting _and racordkeeping requirements, Waste treatment and disposal.

- 23.

3

$ -., t-.+~'a v .--y v

4

-o .

10 CFR Part 61 Criminal penalties, Low-level waste, Nuclear materials, Reporting and recordkeeping requirements, Waste treatment and disposal.

10 CFR Part 70 Criminal penalties, Hazardous materials transportation, Material control and itainers, Padiation protection, f sporting accounting, Nucle ir materials, PA-kaging and and recordkt.eping requirements, ucientific _ aipment, Security measures, Specid nuclear material.

10 CFR Part 71 Criminal penalties, Hazardous materials transportation, Nuclear materials, Packaging and containers, Reporting and recordkeeping requirements.

10 CFR Part 72 Manpower training programs, Nuclear materials, Occupational safety and health, Reporting and recordkeeping requirements, Security measures, Spent fuel.

10 CFR Part 110 Administrative practice and procedure, Classified information, Criminal penalties,

..er plants and Export, import, Intergovernmental relations, Nuclear materials, Nuclear reactors, Reporting and recordkeeping requirements, Scientific equipment.

24

7._ _

e

,.: ~,

-10 CFR Part 150

' Criminal penalties, Hazardous materish transportation,' intergovernmental relationd,_

Nuclear materials, Reporting and recordkeeping requirements, Security rneasures, Source - a materill, Special nuclear material.

For the reasons stated in the preamble and under the authority of the Atomic - ,

Energy Act of 19E4, as a nonded; the Energy Heorg inization Act of 1974, as ame,ded; and 5 U.S.C.:552 and 553; the NRC is adopting the following' amendments to 10 CFR-

- ' Parts 30, 32,- 40, 50,- 52, 60, 61,~ '70, 71, 72,110, and 150.

l PART 30 RULES OF GENERAL APPLICABILITY TO DOMESTIC LICENSING ,

OF BYPRODUCT MATERIAL

'1. The authority citation for Part 30 contir,ues to read as follows:

AUTHORITY: Secs. 81, 82,161,182,183,186, 68 Stat. 935, 948, 953, 954, ,

955i as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2111, 2112, 2201,-

- 2232, 2233, -2236, 2282); secs. 201, as :. mended, 202, 206, 88 Stat.1242, as amended, 1244,1246 (42 U.S.C. 5841, 5842, 5846).

Section 30.7 also issued under Pub. L.95-601, sac.10,92 Stat. 2951 as amended

- by Pub. L 102-486, sec. 2902,106 Stat. 3123, (42 U.S.C. 5851). Section'30.34(b) also issued under sec.184,68 Stat. 954, as amended (42 U.S.C. 2234). Section 30.61 also issued under se:.187,68 Stat. 955 (42 U.S.C. 2237b 25

1. n c,.- ..yq r- -c-- ry 4 m m-a _

2. Section 30.1, is revised to read as follows:

. j_30.1 Sconq.

This part prescribes rules applicable to all persons in the United States governing domestic licensing of byoroduct materiel under the Atomic Enerf,y Act of 1954, as-amended 168 Stat. 910), and under title II of the Energy Reorganization Act of 1974(88 Stat.1242), ant. exe nptions from the domest ci licensing requirements permitted by I Section 81 of the Act. This part also gives notice to all persons who knowingly provide to i

any I;consee, applicant, certificate of registration hoider, contractor, or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's,

~

1 applicant's or certificate of registration holder's activities subject to this part, that they b

may be individually subject to NRC enforcement action for violation of 6 30.10.

3 Section 30.10 is revised to read as follows:

6 30.10 Deliberate misconcuct.

(a) Any licensee, certificate of registration holder, applicant for a license or

' certificate of registration, empioyee of a licensee, certificate of registration holder or applicant; or any contractor (including a supplier or consultant), subcontractor, employee of a contractor or subcontractor of any licensee or certificate of registration holder or applicant for a license or certificate of registration, who knowingly provides to any licensee, applicant, certificate holder, contractor, or subcontractor, any components, equipment, materials, or other goods or services that relate to a licensee's, certificate holder's or applicant's activities in this part, may not:

26

(1) Engage in deliberate misconduct that causes or would have caused,if not detected, a licensee, certificate of registration holder, or applicant to be in violation of any rule, regulation, or order; or any ;erm, condition, or limitation of any !icense issued by the Commission; or (2) Deliberately submit to the NRC, a licensee, certificate of registration holder, an applicant, or a licensee's, certificate holder's or applicant's, contractor or subcontractor, information that the person submitting the inf 3rmatio, knows to be incomplete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(1) or (s)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

(c) For the purposes of paragraph (a)(1) of this section, deliberate misconduct by a person means an intentional act or omission that the person knows:

i

ause a licensee, certificate of registration holder or applicant to be in (1) Wo 3 violation of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Commission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, certificate of registration holder, applicant, contractor, or subcontractor.

PART 32--SPECIFIC DOMESTIC LICENSES TO MANUFACTURE OR TRAN CERTAIN ITEMS CONTAINING BYPRODUCT MATERIAL

4. The authority citation for Part 32 continues to read as follows:

as amended AUTHORITY: Secs. 81,161,182,183, 68 Stat. 935, 948, 953, 954, ,

27

s.

.. ~f (42 U.S.C.' 2111, 2201,'2232, 2233); sec. 201, 88 Stat.1242, as: amended (42 U.S.C.

5841).. .

5 caction 32.1(b) is revised to read as follows:

6 32.1 Puroose. and scope, j

(b) The provisions and requirements of this part are.in addition to, and not in l I

substitution for, otner requirement:, of this chapter. In particular, the provisions of Part 30 of this chapter apply to applications, licenses and certificates of registration subject to this part.

PART 40--DOMESTIC LICENSING OF SOURCE MATERIAL

6. The authority citation for Part 40 continues to read at follows:

AUTHORITYi Secs. 62/ 63, 64, 65, 81,161,182,183,186, 68 Stat. 932, 933, 935,948,953,954,955, as amended, secs.11e(2), 83,84, Pub. L.95-604, 92 Stat.

3033, as amended,3039, sec. 234,83 Stat. 444, as amended (42 U.S.C. 2014(e)(2),

2092, 2093, 20s4, 2095, 2111, 2113, 2114,' 2201, 2232, 2233, 2236, 2282); sec. 202,206, 274, Pub. L. 86 373,73 Stat. 688 (42 U.S.C. 2021); secs. 201, as amended, 88 Stat.;1242, as amended, 1244,1246 (42 U.S.C. 5841,5842,5846); sec. 275,92

. Stat. 3021, as amended by Pub. L.97-415, 96 Stat. 2067 (42 U.S.C. 2022).

Section 40.7 also issued under Pub. L.95-601, sec.10,92 Stat. 2951 as amended by Pub. L. 102-486, sec 2902,;106 Stat. 3123, (42 U.S.C. 5851). Section 4.,.J1(g) also -

~

issued under sec.122,68 Stat. 939 (42 U.S.C. 2152). Section 40.46 also issued under .

~

28 O

sec.;184,68 Stat. 954, as amended (42 U.S.C. 2234). Section 40,71 also issued under sec.-187,63 Stat. 955 (42 U.S.C. 2237).

7J Section 40.2, is revised to read as follows: .t l 40.2 Scoce.

Except as provided in il 40.11 to 40.14, inclusive, the regulations 'n this part.-

apply to all persons in the United States. This part also gives notice to all persons who ,

r knowingly provide to any licensee, applicant, contractor, or subcontractor, components,-

equipment, materials, or other goods or services, that relate to a licensee's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement d

action for violation of 5 40.10.

8. Section 40.10 is revised to read as follows:

6 40.10 Deliberate misconduct.

.(a) Any licensee, applicant for a license, employee of a licensee or applicant; or any contractor (including a supplier or consultant), subcontractor, employee of a contractor or subcontractor of any licensee or applicant for a license, who knowingly provides to any licensee, applicant,' contractor, or subcontractor, any components, equipment, materials, or other goods or services that relate to a licensee's or applicant's activities in this part, may not:

(1IEngage in deliberate misconduct that causes or would have caused, if not det:,cted,' a licebhee or applicant to be in violation of any rule, regulation, or order; or any b

29 V

, +v -

s , u , 1k-- , -y -s s

i

. . term, condition, .or limitation of any license issued by tho Comrnission; or 1 (2) Deliberately subr.iit to the NRC,' a licensee, an applicant, or a licensee's or applicant's' contractor or subcontractor, information that the person submitting the -)

ir: formation knows to be incomplete or inaccurate in some respect material to the NRC.- ,

(b) A person who violates paragraph'(a)(1) or (a)(2) of this section may be subject

' to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart 8.

(c) For the purposes of paragraph (a)(1) c.f tNs section, oeliberate misconduct by a

, +

person means an intentional act or omission that the person knows:

(1) Would cause a licen ee or appiicant te be in violation of any rule, regulation, or

- order; or any term, condition', or limitation, of_ any license issued by the Commission; or

-(2) Constitutes a violation of a requirement, procedure, instruction, contract, .

' purchase order, or policy of a licensee, applicant, contractor, or subcontractor. t

" PART 50 -DOMESTIC LICENSING OF PRODUCTION AND UTILIZA

9. The authority citation for Part 50 continuen to read as follows:

AUTHORITY: Secs. 102,103,104,105,161,182,183,186,189, 68 Stat. 936,

.937,938,948,953,954,955,956, as amended, sec. 234,83 Stat. 444, as amen edd (42 U.S.C. 2132, 2133, 2134, 2135, 2201, 2232,'2233,' 2236, 2239, 2282); secs. 201,

' as amended, 202, 206,88 Stat.1242, as amended, 1244,1246 (42 U.S.C. 5841, 5842, 5846).

-Section 50.7 also issued under Pub. L 95-601, sec.10,92 Stat. 2951 as amended

- by Pub. L 102-486, sec. 2002,106 Stat 3123, (42 U.S.C. 5851). Section 50.10 also _

~

issued under secs. 101,185, 68 Stat.' 936, 955, as amended (42 U.S.C. 213f,2235);

i:

30 f-t km -,, c :H, - w - ~

1 c

e 50.13, 50.54(dd),

sec.102, Pub.- L.91-190, 83 Stat. 853 (42 U.S.C. 4332). - Sections and 50.103 also issued under sec.108,68 Stat. 939, as amended (42 U.S.C. 2138).

Sections 50.23, 50.35, 50.55, and 50.56 also issued under sec.185,~ 68 Stat,955 (42J i

U.S.C. 2235). Sections 50.33a,50.55a and Appendix Q also issued under sec.102, Pub.

L.91-190, 83 Stat. 853 (42 U.S.C.'4332). Sections 50.34 and 50.54 also issued under -

sec.'204,'88 Stat.1245 (42 U.S.C. 5844).' Sections 50.58, 50.91, and 50.92 also 4 e

issued under Pub L 9"-415,96 Stat. 2073 (42 U.S.C. 2239). Section 50.78 also issued under sec; 122,68 Stat. 939 (42'U.S.C. 2152). Sections 50.80 - 50.81 also is:ued -

l i d under sec.184,68 Stat. 954, .3 amended (42 U.S.C. 2234) Appendix F a so ssue under sec.187,68 Stat.-955 (42 U.S.C 2237).

10. Section 50.1,-is revised to read as follows:

4 A

5 50.1 8 asis, ouroose, and orocedures aoolicable.

The regelations in this part are promulgated by the Nuclear Regulatory Commission pursuant to the Atomic Energy Act of 1954, as amended (68 Stat.- 919), and Title ll of the Energy Reorganization Act of 1974 (88 Stat.1242), to provide for the licensing of

- production and utilization facilities. This part alco gives notice to all persons who knowingly provide to any licensee, applicant, contractor,'or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement

~

action for violation of 6 50.5.

t 31 o

y

$ g r-q,- -, a h- 1 e., w . ----z-4 km.- *.w w r -+% e *- e- s P

-I 11 - Section 50.5 is revised to read as follows:

6 50.5 - Deliberate misconduct.  !

(a) Any licensee, applicant for a license, employee of a licansee or applicant; or any l

contractor (including a supplier or consultant), subcontractor, employee of a contractor or .

subcontractor of any licensee or applicant for a license, who knowingly provides to any

' !icensee. applicar t, contractor, or subcontractor, any components, equipment, r,aterials,

! or other goods or services that relate to a licensee's or epplicant's activities in this part,

.may not:

(1) Engage in deliberate misconduct that causes or would have caused, if not :

^

detected, a licensee or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation of any license issued by the Commission; or (2) Deliberately submit to the NRC, a licensee, an applicent, or a licensee's or applicant's' contractor or subcontractor, information that the person submitting the information knows to be incomplete or inaccurate in some respect material to the NRC,

-(b) A person who violates paragraph (a)(1) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

-(c) For the purposes of paragraph (a)(1) of this section, deliberate misconduct by a person'means an intentional act or omission that the person knows:

(1) Would cause a licer.see or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Commission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, applicant, contractor, or subcontractor.

d 32' 1 7.-  % ,,. . _ ,, _ m._-- , . -- , ,

mr .-s

l PART 52- EARLY SITE PERMITS: STANDARD DESIGN CERTIFICATIONS; AND COMBINED LICENSES FOR NUCLEAR POWER PLANTS

12. The authority citation for Part 52 is revised to reso as follows:

i AUTHORITY: Secs.103,104,161,182,183,186,189, 68 Stat. 936, 940, 953, 954,955,956, as amended, sec. 234,83 Stat. 444, as amended (42 U.S.C. 2133, 2201, 2232, 2133, 222 S, 2239, 2282); secs. 201, 202. 206, 88 Stat.1242,1744, 1246, as amended (42 U.S.C. 5841,5842,5846).

13. Section 52.1 is revised to read as follows:

5 52.1 Scoog.

This part governs the issuance of early site permits, standard design certifications, and combined licenses for nuclear power f acilities licensed under Section 103 or 104b of the Atomic Energy Act of 1954, as amended (68 Stat. 919), and Title 11 of the Energy Reorganization Act of 1974 (88 Stat.1242). This part also gives notice to all persons who knowingly provide to any holder of or applicant for an early site permit, standard design certification, or combined license, or to a contractor, sube.ontractor, or consultant of any of them, components, equipment, materials, or other goods or services, that relate to the activities of a holder of or applicant for an early site permit, standard design certification, or combined license, subject to this part, that they may be individually subject to NRC' enforcement action for violation of 6 52.9.

i 33

-__ _  : 8

A 4 14.' Section 52.9 is added to read as follows:

I 52,9 Deliberate Misconduct.

(a) Any holder of, or applicant for, an early site permit, standard design certification, or combined license, including its employees, contractors, subcontractors, or consu' 9nts and their employees, who knowingly provides to any holder of, or applicant for, an early site perrait, standard design certification. or combined license, or to a contractor, subcontractor or consultant of any of them, equipment, materials, or other

- goods or services that relate to the activities of a holder of, or applicant for, an early site permit, standard design certification or combined license in this part, may not:

(1) Engage in deliberate misconduct that causes or would have caused, if not di,tacted, a holder of, or applicant for, an early site perreit, standard design certification, or combined license, to be in violation of any rule, regulation, or order; or any term, condition, or limitation of any permit, certification or license issued by the Commission; or (2) Deliberately submit to the NRC, a holder of, or applicant for, an early site permit, standard design certification, or combined license, or a contractoc, subcontractor, or consultant of any of them, information that the person submitting the information knows to be incomplete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(1) or (a)(2) of this section may be subject to enforcement action in accordance with the procadures in 10 CFR Part 2, subpart B.

(c) For the purposes of paragraph (a)(1) of this section, deliberate misconduct by a person means an intentional act or omission that the person knows:

(1) Would cause a holder of, or applicant for, an early site perrnit, standard design certification, or combined license, to be in violation of any rule, regulation, or order; or any 34 Y - w ~

r

term, condition, or limitation, of any license issued by the Commission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract,.

L purchase order, or policy of a holder of, or applicant for, an early site permit, certified design or combined license, or a contractor or subcontractor of any of them.

PART 60--DISPOSAL OF HIGH LEVEL RADIOACTIVE WASTES IN GEOLOGIC REPOSITORIES

15. The authority citation for Part 60 continues to read as follows:

AUTHORITY: Secs. 51, 53, 62, 63, 65, 81,161,182,183, 68 Stat. 929, 930, .

932,933,935,948,953,954, as amended (42 U.S.C. 2071, 2073, 2092, 2093, 2095, 2111, 2201, 2232, 2233;; secs. 202, 206, 88 Stat.1244.1246 (42 U.S.C. 5842, 5846); secs.10 and 14, Pub. L. 95 601,92 Stat. 2951 (42 U.S.C. 2021a and 5851);

sec.102, Pub. L.91-190, 83 Stat. 853 (42 U.S.C. 4332); secs.114,121, Pub. L.97-425,96 Stat. 2213g,2228, as amended (42 U.S.C.10134,10141) and Pub. L. 102-486, sec. 2902,106 Stat. 3123 (42 U.S.C. 5851).

16. Section 60.1, is revised to read as follows:

6 60.1 Purpose and Scone.

This part prescribes rules governing the licensing of the U.S. Department of Energy to receive and possess source, special nuclear, and byproduct material at a geologic repository operations area sited, constructed, or operated in accordance with the Nuclear Waste Policy Act of 1982. This part does not apply to any activity licensed under another 35 i

$ 4 part of this chapter. This part also gives notice to all persons who knowingly provide to any licensee, applicant, contractor, or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement action for violation of 5 60,11.

17. Section 60.11 revised to read as fo!'ows:

I 60.11 Delibera'.3 misconduct.

.(a) Any licensee, applicant for a license, employee of a licensee or applicant; or any contractor (including e supplier or consultant), subcontractor, employee of a contractor or subcontractor of any licensee or applicant for a license who knowingly provides to any licensee, applicant, contractor, or subcontractor, any components, equipment, materials, or other goods or services that relate to a licensee's or applicant's activities in this part, may not:

(1) Engage in deliberate misconduct that causes or would have caused, if not detected, a licensee or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation of any license issued by the Commission; or (2) Deliberately submit to the NRC, a licensee, an applicant, or a licensee's or applicant's contractor or subcontractor, information that the person submitting the information knows to be incomplete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(1) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

36

- , . 1 -;

i.-.

-(c) For the purposes of paragraph (a)(1) of this'section; deliberate misconduct by a -

person means an intentional act or omission that the person knows: ,

(1) Would cause a licensee or applicant to be in violation lof any rule, regulation, or

= order; or any term, condition, or limitation,.of any license issued .by the Commission; or e

(2) Constitutes a violation of a requirement, procedure, instruction; contract, purchase order, or policy of a licensee, applicant, contractor, or subcontractor.

r PART 61-LICENSING REQUIREMENTS FOR LAND DISPOSAL OF RADIOACTIVE WASTE

18. The authority citation for Part 61 continues to read as follows:

AUTHORITY: Secs. 53, 57, 62, 63, 65, 81,161,182,183, 68 Stat. 930, 932, 933,.935,948,953,.954, as amended (42 U.S.C. 2073, 2077, 2092, 2093, 2095, 2111,.2201, 2232, 2233); secs. 202, 206,88 Stat.1244,1246 (42 U.S.C. 5842, 5846); secs.10 and 14, Pub. L.95-601,92 Stat. 2951 (42 U.S.C. 2021a and 5351) and Pub. L.102 486, sec 2902,106 Stat. 3123, (42 U.S.C. 5851).

19. Section 61.1 (c), is revised to read as follows:

~

l 61.1 Puroose and Scoo_e.

(c) -This part also gives notice to all persons who knowingly provide to any L licensee, applicant, contractor, or subcontractor, components, equipment, materials, or other goods or s$rvices,'that relate to a licensee's or applicant's activities subject to this

_ .37

.~4

. 4 i Oa- h6. '

-m ,

part, that they may be~ individually subject to NRC enforcement action for violation of.

5 61.. 9b. t

. .20. 'Section 61.9b is revised to read as follows:

~ 161.9b Deliberate misconduct. ,

~

(a) Any licensee, applicant for a license, arrnioyee of a licensee or applicant; or any - e

-3 contractor (including a supplier or' consultant), subcontractor, employee of a contractor.or fi subcontractor of any licensee or applicant for a license, who knowingly provides to any-i licensee, applicant, contractor, or subcontractor, any. components, equipment, materials, or other goods or services that relate to a licensee's or applicant's activities in this part, may not:  :

(1) Engage in deliberate misconduct that causes or would have caused, if not ,

detected, a licensee or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation of any license issued by the_ Commission; or

'(2)E Deliberately submit to.the NRC, a licensee, an applicant, or a licensee's or 4

. applicant's contractor or subcontractor, information that the person submitting the-information knows to be incomplete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(1) or (a)(2) of this section may be subject with the procedures in 10 CFR Part 2, subpart B.

to enforcement action in accordance

.t a

(c) For the purposes of paragraph-(a)(1) of this section, deliberate misconduct by a person means an intention 61 act or omission that the person knows:

(1)- Would cause a licensee or applicant to;be in violation of any rule, regulation, or order; or any. term, conditi_on, or limitation, of any license issued by the Commission; or C ..

ir

-38

' I 1

[

3,

.~ - - ~ , , . . , . . - r -

a (2) Constitutes a violation ci a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, applicant, contractor, or subcontractor.

PART 70- DOMESTIC LICENSING OF SPECIAL NUCLEAR MATERIAL

21. The authority citation for Part 70 continues to read as follows:

AUTHORITY: Sces. 51, 53,161,182,183, 68 Stat. 929, 930, 948, 953, 954, as amended, sec. 234,83 Stat. 444, as amended, sec. 1701,106 Stat. 2951, 2952, 2953 -

(42 U.S.C. 2071, 2073, 2201, 2232, 2233, 2282, 2297f); secs. 201, as amended, 202, 204, 206, 88 Stat.1242, as amended, 1244,1245,1246 (42 U.S.C. 5841, 5842, 5845, 5846). t Sections 70.1(c) and 70.20a(b) also issued under secs. 135,141, Pub. L. 97 425 96 Stat. 2232, 2241 (42 U.S.C.10155,10161). Section 70.7 also issued under Pub. L.

95 601, sec.10,92 Stat. 2951 (42 U.S.C. 5851). Section 70.21(g) also issued under sec.122,68 Stat. 939 (42 U.S.C. 2152). Section 70.31 also issued under sec. 57d, Pub.

L. 93 377,88 Stat. 475 (42 U.S.C. 2077). Sections 70.36 and 70.44 also issued under sec.184,68 Stat. 954, as amended (42 U.S.C. 2234). Section 7.0.61 also issued under secs.186,187, 68 Stat. 955 (42 U.S.C. 2236, 2237). Section 70.62 also issued under sec.108, 68 Stat. 939, as amended (42 U.S.C. 2138).

39

" - - - - ~ - _ - _ _ _ _ _ _ _ , _ _ _ _ , _

.. - . . . - . . . .. . .- _ . - . . - .. - -,~ . -- -. .. . . . . .

.i 4

_22.- Section 70.2, is revised to read as follows:

F

.6 70.2 Scope.

Except as provided in 5 6.70.11 to 70.13, inclusive, the regulations in this part

_ apply to all persons in the . United States.- This part also gives notice to all persons who .

r- knowingly provide to any licensee, applicant, contractor, or subcontractori components, '

c equipment, mate-ials, or other goods or services, that relate to a licensevs or amplicant's t

f ._

activities subject to this part, that they may be individually subject to NRC enforcement

= action for violation of 5 70.10. .

E i

23. Section 70.10 is revised to read as foJows: e 4

s 5 70.10' Qp!!kagte misconduct. .

(a) Any licensee, applicant for a license, employee of a licensee or applicant; or any

. contractor (including a supplier or consultant), subcontractor, employee of a contractor or subcontractor of any licensea or appticant for a licerise, who knowingly. provides to any licensee, applicant,' contractor, or subcontractor, any components, aquipment, materials, r

or other goods or services that relate to a licensee's or applicant's activities in this part, may not

- (1) Engage in deliberate misconduct that causes or would have caused, if not detected, a Scensee or applicant to be in violation of any rule, regulation, or order; or any-term, con'dition, or limitation'of any license issued by the Commission; or ,

,e* am g 40

+

. * - - - ,-n w - = ,w-- ., e e., e . , -- .

4 (2) Deliberately submit to the NRC, a licensee, an applicant, or a licensee's or ar.,plicant's contractor or subcontractor, information that the perr.on submitting the ,

information knaws to be incomplete or inaccurate in some respect material to the NRC, (b) A person who violates paragraph (a)(1) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

(c) For the purposes of paragraph (a)(1) of this section, deliberate misconduct by a person means an intentianal act or omission that the person knows:

(1) Would cause a licensee or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Commission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensec, applicant, contractor, or subcontractor.

PART 71--PACKAGING AND TRANSPORTATION OF RADIOACTIVE MATERIAL

24. The authority citation for Part 71 continues to read as follows:

AUTHORITY: Secs. 53, 57, 62, 63, 81,161,182,183, 68 Stat. 930, 932, 933, 935,948,953,954, as amended, sec. 1701,106 Stat. 2951, 2952, 2953 (42 U.S.C.

2073, 2077, 2092, 2093, 2111, 2201, 2232, 2233, 2297f); seca. 201, as amended, 202, 206, 88 Stat.12424 as amended, 1244,1246 (42 U.S.C. 5841, 5842, 5846).

Section 71.97 also issued under sec. 301, Pub. L.96-295, 94 Stat. 789 790.

41

4

25. In section 71.0, paragraph .(f) is added to read as follows: ,

171.0 Puroose and Scope.

(f) This part also gives notice to all persons who knowingly provide to any licensee, certificate holder, quality assurance program approval holder. applicant for a license, certificate, o quality sssurance program appreval or to a contractor, or subcontractor of any of them, components, equipment, materials, or other goods or services, that relate to a licensee's, certificate holder's, quauty assurance program approval holder's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement ,

action for violation of i 71.11.

26. Section 71.11 is added to read as follows:

I 71.11 Deliberate misconduct.

(a) This section applies to any---

i (1) Licensee:

(2) Certificate holder; (3) Quality assurance prograr. approval holder; (4) Applicant for a license, certificate, or quality assurance program approval;

'(5) Contractor (including a supplier or consultant) or subcontractor, to any person I identified in paragraphs (a)(1) through (a)(4) of this section; or 42 1'

8 A

-(6) Employee of any person' identified'in' paragraphs (a)(1) through (a)(5) of this section.-

(b) 'A person identified in paragraph (a) of this section who knowingly prcvides to any entity, listed in paragraphs (a)(1) through (a)(5) of this section any components, materials, or other goods or services that relate to a licensee's, certificate holder's, quality

- assurance program approval holder's or applicant's activities subject ia this part may r'ot:

(1) -Engage in deliberate misconduct taat causes or would have caused, if not detected, a licensee, certificate holder, quality assurance program approval holder, or any applicant to be in violation of any rule, regul tion, or order; or any term, condition, or limitation of any license, certificate or approvalissued by the Commission; or (2) Deliberately submit to the NRC, a licensee, a certificate holder, quality assurance program approval holder, an applicant for a license, certificate or quality assurance program approval, or a licensee's, applicant's, certificate holder's or quality P

assurance program approval holder's contractor or subcontractor, information that the person submitting the information knows to be incomplete or inaccurate in some respect material to the NRC.

(c) A person who violates paragraph (b)(1) or (b)(2) of this, section may be subject

- to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

(d) For _the purposes of paragreoh (b)(1) of this section, deliberate misconduct by a -

person means an intentional act or omission that the person knows: ,

(1) Would cause a licensee, certificate holder, quality assurance program approval holder or applicant for a license, certificate, or quality assurance program approval to be in

violation of any rule, regulation, or order; or any term, condition, or limitation, of any license or certificate issued by the Commission; or 43

t' (2) Constitutes a violation of a requirement, procedure, instruction, contract,

. purchase order, or policy of a licensee, certificate holder, quality assurance program.

- approval holder, applicant, or the contractor or subcontractor of any of them.

PART'72--LICENSING REQUIREMENTS FOR THE INDEPENDENT STOR NUCLEAR FUEL AND HIGH-LEVEL RADIOACTIVE WASTE 27.~ The authority citation for Part 72 continues to read as follows:

n AUTHORITY: Secs. 51,53,57,62,63,65,69,81,161,182,183,184,186, as amended,

.187,189, 68 Stat. 929, 930, 932, 933i 934, 935, 948, 953, 954, 956, sec. 234, 83 Stat. 444i as amended (42 U.S.C. 2071, 2073, 2077, 2092, 203, 2095, 2099, 2111, 2201, 2232, 2233, 2234, 2236, 2237, 2238, 2282); sec. 274, Pub. L. 86 202,206,88 373,73 Stat. 688, as amended (42 U.S.C. 2021); sec. 201, as amended, Stat.1242, as amended, 1244,1246 (42 U.S.C. 5841, 5842, 5846); Pub. L. 95 601,

- sec.10,92 Stat,295 as amended by Pub.L. 102-486, sec. 7902,106 Stat. 3123 (42 U.S.C. SE.51); sec.102, Pub. L.91-190, 83 Stat. (42 U.S.C. 4332); secs.131,132,133,

135,137,141, Pub. L. 97 425, 96 Stat. 2229, 2230, 2232, 2241, sec.148, Pub. L.

100-203,101 Stat,1330-235 (42 U.S.C.10151,10152,10153,10155, _10157,10161, 10168).

100-203, Section 72.44(g) also issued under secs.142(b) and 148(c), (d), Pub. L.

Section 72.46 also 101 Stat.1330 232,1330-236 (42 U.S.C.10162(b),10168(c), (d)).

issued under sec.189,68 Stat. 935 (42 U.S.C. 2239); sec.--134, Pub. L.97-425, 96 Stat. 2230 (42 U.S.C.10154). :Section 72.96(d) also issued under sec.145(g) Pub. L.

/

1100 203,'101 Stat.1330-235 (42 U.S.C.10165(g)). Subpart J also issued under secs.

44

k i

2(2), 2(15), 2(19),117(a),141(h), Pub. L. 97 4 25, 96 Stut. 2202, 2203, 2204, 2222, 2224 .42 U.S.C.10101,10137(a),10161(h)). Subparts K and L are also issued under sec.133,96 Stat. 2230 (42 U.S.C.10153) and sec. 218(a), 96 Stat. 2252 (42 U.S.C.

10198).

28. In section 72.2, parrgraph (f) is revised to read as follows:

6 72.2 Scor>e.

(f) This pr ,t also pives notice to all persons who knowingly provide to any licensee, certificate holder, applicant for a license or certificate, contractor, or subcontractor,  :

componcnts, equipment, materials, or other goods or services, that relate to a licensee's, certificate holder's, or applicant's activities subject to this part, that they may be .

individually subjoct to NRC enforcement action for violation of 6 72.12.

29. Sec 72.12 is revised to read as follows:

6 72.12 Deliberate misconduct.

(a) Any licensee, certificate holder, applicant for a license or certificate, employee of a licensee, certificate holder, or applicant for a license or certificate; or any contractor (including a supplier or consultant) or subcontractor, employee of a contractor or subcontractor of any licensee, certificate holder, or applicant for a license or certificate who knowingly provides to any licensee, certifierte holder, applicant for a license or 45

J 1

E 4 certificate, contractor, or subcontractor, any components, materials, or other goods or services that relate to a licensee's, certificate holder's, or applicant's activities subject to this part, may not:

(1) Engage ;n deliberate misconduct that causes or would have caused,if not detected, a licensee, certificate holder or applicant to tu in violation of any rule, regulation, or order; or any term, condition, or limitation of any license or certificate issued by the Commission; or (2) Deliberately submit to the NRC, a licensee, a certificate holder, nn applicant for a license or certificate, or a licensee's, applicant's, or certificate holder's contractor or subcontractor, information that the person submitting the information knc 76 to be incomplete or irraccurate in some respect material to the NRC, (b) A person who violates paragraph (a)(1) os (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

t (c) For the purposes of paragraph (a :1) of this section, deliberate misconduct by a person means an intentiona! act or omission that the person knows:

(1) Would cause a licensee, certificate holder or applicant for a license or certificate to be in violation of any rule, regulation, or order; or any term, condition, or Umitation, of any license or certificate issued by the Commission; or (2) Constitutes a violation of a cequirement, procedure, instruction, contract, purchas6 order, et policy of a licensee, certificate bolder, applicant, contractor, or subcontractor.

46

= _ _ - - . _ - _ _ _ _ _ . _ - - - - - - - - _ - - - - - . - - . - -. _- - -- .

PART 110- EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATE l

30. The authority citation for Part 110 continues to read as follows:

AUTHORITY: Secs. 51,53,54, 57,63, 64, 65,81, 82,103, 104,109,111, 126, 127,128,120,161,181,182,183,187,189, 68 Stat. 929, 930, 931, 932, 933, 936, 937,948,953,954,955,956, as amended (42 U.S.C. 2071, 2073, 2074, 2077, 2092-2095, 2111, 21 2. * : 33, 2134, 2139, 2139a, ::141, 2154 2158, 2201, 22312233, 2237, 2239); sec. 201, 88 Stat.1242, as amended (42 U.S.C. 5841; sec 5, Pub. L.101-575,104 Stat 2835 (42 U.S.C.2243).

96 92, 93 Stat.

Sections 110.1(b)(2) and 110.1(b)(3) also issued under Pub. L.

710 (22 U.S.C. 2403). Section 110.11 also issued under sec.1."2,68 Stat. 939 (42 ,

U.S.C. 2152) and secs. 54c and 57d., 88 Stat. 473,475 (42 U.S.C. 2074). u.: tion 110.27 also issued under sec. 309(a), Pub. L. 99 440. Section 110.50(b)(3) also issued under sec.123,92 Stat.142 (42 U.S.C. 2153). Section 110.51 also issued under sec. 184,68 Stat. 954, as amended (42 U.S.C. 2234). Section 110.52 also issued under sec. ,

186,68 Stat. 955 (42 U.S.C. 2236). Sections 110.80 110.113 also issued under 5 t U.S.C. 552, 554. Sections 110.130-110.135 also issued under 5 U.S.C. 553. Sectiors 110.2 and 110.42 (a!(9) also issuea under sec. 903, Pub. L.102-496 (42 U.S.C. 2151 et seq.).

47 .

I 1

- ,, +, , *

- - -... ,n.e.,. _,nn,-, - .m-, -

y n , , -.

_ _ . _ . __ . . _ _ . _ _ =_ _ _ _ __

a l

31. In Section 110.1, paragraph (a) is revised to read as follows:

I 110.1 Purcose and Scone.

(a) The regulations in this part prescribe licensing, enforcement, and rulemaking procedures and criteria, under the Atomic Energy Act, for the export of nuclear equip and material, as set out it ti 110.0 and 110.9, and the import of nuclear equipment an material, as set )ut in i i 4 0.9a. This part also gives nodce to all persons whc knew;ngl provide to any licensee, applicant, contractor, or subcontractor, components, equipm materials, or other goods or services, that relate to a licensee's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement actio violation of i 110.7b.

32. Section i t0.7b is revised to read as follows:

6110.7b Deliberate misconduct. '

(a) Any licer.cee, applicant for a license, employee of a licensee or applicant; or any contractor (including a supplier or consultant), subcontractor, employee of J contractor or st.bcontractor of 6ny licensee or applicant fer a license, who knowingly provides to any licensee, applicant, contractor, or subcontractor, any components, equipment, materia or other Coods or services that relate to a licensee's or appilcant's activities in this part, may not:

(1) Engage in deliberate mi; conduct that causes or would have caused,if not ,

detected, a licensee or applicant to be in violation of any rule, regulation, or order; or any terrn, condition, or limitation of any license issued by the Cornmission; or 48

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l1 . , ., _.

(2) Deliberately submit to the NRC, a licensee, an applicant, or a licensee's or applicant's contractor or subcontractor, information that the person submitting the wspect material to the NRC.

information knows to be incomplete or inaccurate in s.

(b) A person who violates paragraph (al(1) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR Part 2, subpart B.

(c) For the purposes of paragraph (a)(1) of this section, deliberate misconduct by a person means at: intent anal act or omission that 1e per.)on knows:

(1) Would cause a licensee or applicant to be in violation of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Commission; or (2) Const'tutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, applicant, contractor, or subcontractor.

PART 150--EXEMPTIONS AND CONTINUED REGULATORY AUTHORIT IN AGREEMENT STATES AND IN OFFSHORE WATERS UNDER SECT

33. The authority citation for Part 150 continues to read as follows:

AUTHORIT(: Sec.161,68 Stat. 948, as amended, sec. 274,73 Stat. 688 (42 U.S.C. 2201, 2021); sec. 201,88 Stat.1242, as amended (42 U.S.C. 5841).

Sections 150.3, 150.15, 150.15 a, 150. 31, 150. 32 also issued under secs.11e(2), 3 81, 68 Stat. 923, 935, as amended, secs. 83,84,92 Stat. 3033,3039 (42 U.S.C.

2014e(2), 2111, 2113, 2114). Section 150.14 also issued under sec. 53,68 Stat. 930, 135,141, Pub.L.

as amended (d? U.S.C. 2073) Section 150.15 also issued under secs.

49 l

e 97 425,96 Stat. 2232,2241 (42 U.S.C.10155,10181). Section 150.17a also issued under sec.122,68 Stat. 939 (42 U.S.C. 2152). Section 150.30 also issued under rec.

234,83 Stat. 444 (42 U.S.C. 2282).

34. Section 150.2 is revised to read as follows:

1 150.2 Scang.

The regulations in this part apply to all States that have entered into agreements with the Commission or the Atomic Energy CommL3 ion pursuant to subsection 274b of the Act. This part also gives notice to all persons who knowingly provide to any licensee, applicant for a license or certificate or quality assurance program approval, holder of a certificate or quality assurance program approval, contractor, or subcontractor, any components, equipment, materials, or other goods or services that relate to a licenseo's, certificate holder's, quality assurance program approval holder's or applicant's activities subject to this part, that they may be individually subject to NRC enforcement action for >

violation of Il 30.10, 40.10, 70.10 and 71.11.

_ day of ,1997.

' Dated at Rockville, Maryland, this For the Nuclear Regulatory Cornmission.

John C. Hoyle, Secretary of the Commission.

50

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ENCLOSURE 2 FRN - ENFORCEMENT POLICY I

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NUCl. EAR REGULATORY COMMISSION (NUREG 1600)

Policy and Procedure for Enforcement Actions; Deliberate Misconduct Rule AGENCY: Nuclear Regulatory Commission.

ACTION: Policy statement: Amendment

SUMMARY

The Nuclear R Iulatory Commission (NRC) is amending its " General Statement of Policy and Procedure for NRC Enforcement Actions" to conform to modifications to the Deliberate Misconduct Rule. These modifications extend thet R applicants for NRC licenses, applicants for, and holders of, certificates of compliance, early site permits, r.tandard design certifications, or combined licenses issued under Part 52, applicants for or holders of certificates of registration, cuality assurance approvals, and the employees, contractors, subcontractors, and consultants of those persons. By a separate action published in this issue of the Federal Register, tne Commission has issued a final rule amending 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 73,110, and 150.

This action is effective on [30 days af ter publication in the Federal EFFECTIVE DATE:

Register).

^

.* FOR FURTHER INFORMATION CONTACT: ' James Lieberman Director Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001,

-(301) 415-2741.

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e SUPPLEMENTARY INFORMATION:

c The Commission's " General Statement of Policy and Procedure for NRC  !

Enforcement Actions" (Enforcement Policy or Policy) war ',st issued on September 4, i 1980. Since that time, the Enforcement Policy has been revised on a number of  !

occasions. On June 30,1995 (60 FR 34381L the Enforcement Policy was revised in its The Policy primarily addresses violations l entirety and was also published as NUREG 1600  :

by licensees and certain non-licensed persons, as discusced further in footnote 3 to Section I, introduction and Purpose, and in Section X: Enforcement Action Against Non-

' licensees, '

The Deliberate Misconduct Rule was adopted in September 1991 and applies to any licensee or any employee of a licensee; and any contractor (including a supplier or consultant), subcontractor, or any employee of a contractor or subcontractor, or any I

& licensee. The Deliberate Misconduct Rule placed licensed and unlicensed persons on notice that they may be subject 19 enforcement action for deliberate misconduct that causes or would have caused, if not detected, a licensee to be in violation of any of the Commission's requirements, or for deliberately providing to the NRC, a licensee, or contractor, information that is incomplo or inaccurate in some respect material to the  !

NRC.

The final rulemaking expands the Deliberate Misconduct Rule, where it appears in 10 CFR Parts 30,' 40,50,60,61,170,72, and 110, and adds the Rule to Parts 52 and 71. .

This expansion arises out of a realization that the current Rule does not apply to applicants 2

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for NRC licenses, applicants for, or holders of, certificates of compliance, early site permits, standard design certifica"ons, or combined licenses issued under Part 52, ,

i applicants for or holders of certificates of registration, quality assurance program approvals  ;

The  ;

and the employees, contractors, subcontractors, and consultants of those persons i

Commission believes that it is equally important for these categories of persons to be ,

subject to enforcement action for deliberate wrongdoing, such as the submission of inaccurate or inc:mplete information.

t 1

The Commission is making this change to the General Statement of Policy and Procedure for NRC Enforcement Actions to make it consistent with the regulations. The ,

changes include: (1) expansion of footnote 3 in Section I, which discusses the scope of i

the Policy; (2) deletion of the reference to vendors in Section VI,C.5, to avoid possible confusion as a result of a partiallisting of those to whom the Rule and Policy apply; and (3) restating the opening sentence in Section VI.C.5 and in Section X: Enforcement Actions Against Non-licensees, to set out the full scope of the Rule and its application through the Enforcement Policy.

The Ccmmission has held that the term " contractor" includes a vendor or supplier that manuf actures and offers for sale materials intended for use by NRC !icensees and

certified to meet the requirements of 10 CFR Part 50, Appendix B. In the Matter of: Five

' Star Products, Inc. and Construction Products Research, Inc., 38 NRC 169, CLI 93 23

(October 21.'1993).- In light of that holding, the remaining references to vendors-

throughout the Enforcement Policy are also being modified to refer to contractors as the 3

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inclusive term. These changes are being made in Sections V, VI.B.1, VI.C, VI.D, Vlli, X, Table 1 A, and Supplements 1.C. and Vll.C.

t Paperwork Reduction Act This policy statement does not contain a new or amended information collection requirement subject to the Paperwork Reduction A -. of 1995 (44 U.S.C. 3501 et seq.).

Existing requirements were approved by the Office of Management and Budget, approval number 3150-O* 30. The approved information collection requirements contained in this policy statement appear in Section Vll.C.

t Public Protection Notification The NRC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB coiarol number.

Small Business Regulatory Enforcement Fairness Act in accordance with the Small Business Regulatory Enforcement Fairness Act of 1996, the NRC has determined that thic action is not "a major" rule and has verified this determination with the Office of Information and Regulatory Aff airs, Office of Management and Budget.

4 ,

i

e Accordingly, Sections I, V, VI B,, C., and D., Vill, X, and Oupplements I and Vil of the NRC Enforetiment Policy are amended to road as follows:

GENERAL STATEMENT OF POLICY AND PROCEDURE FOR NRC ENFORCEMENT ACTION

l. INTRODUCTION AND PURPOSE The purpose of the NRC enforcement program is to support the NRC's overall safety mission in protecting the public and the environment. Consistent with that purpose,

! enforcement action should be used:

• As a deterrent to emphasize the importance of compliance with requirements, and'

• To encourage prompt identification and prompt, comprehensive correction of i _.

Violations, Consistent with the purpose of this program, prompt and vigorous enforcement action will be taken when dealing with licensees, contractors,' and their employees, who

. do not achieve the necessary meticulous attention to detail and the high standard of a

8 i t b used

_. The term

• contractor" as used in this p slicy includes vendors who supply products or serv ces o e in an NRC-licensed f acility of activity, i

5

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compliance which the NRC expects.8. Each enforcement action is dependent on the circumstances of the case and requires the exercise of discretion after consideration of ,

these policies and procedures. In no case, however, willlicensees who cannot achieve i and maintain adequate levels of protection be permitted to conduct licensed activities.

V. PREDECISIONAL ENFORCEMENT CONFERENCES Whenever the NRC has learned of the existence of a potential violation for which i

escalated enforcement action appears to be ' stranted, or recurring nonconformance on the part of a contractor, the NRC may provide an opportunity for a predecisional enforcement conference with the licensee, contractor, or other person before taking enforcement action. The nurpose of the conference is to obtain information that will assist the NRC in determining the appropriate enforcement action, such as: (1) a common understanding of f acts, root causes and missed opportunities associated with the apparent violations, (2) a common understanding of corrective actions taken or planned, and (3) a

- . common understanding of the significance of issues and the need for lasting comprehensive co.rective action.

8 This policy primarily addresses the activities of NRC licensees and applicants for NRC licenses.

Therefore, the term " licensee" is used throughout the policy. However, in those cases where the NRC determites that it is appropriate to take enforcement action against a non-licensee or individual, the guidance c in this policy will be used, as applicable. These non-licensees include contractors and subcontractors, holders o f, or applicants for, NRC approvals, e.g., certificates of compliance, early site permits, or standard design

~

certificates and the employees of these non-licensees. Specific guidance regartfing enforcement action against '

individuals and non-licensees is addressed in Sections Vill and X, respectively.

6

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' . . t During the predecisional enforcement conference, the licensee, contractor, or other  ;

persons will be given an ooportunity to provide information consistent with the purpose i

the conference, including an explanation'to the NRC of the immediate corrective actions (if any) that were taken following identification of the potent!al violation or nonconformance and the long term compr 'hensive actions that wen taken or will be taken to prennt recurrence. Licensees, contractors, or other persons will be told when a meeting is a i

predecisional enforcement conference. e VI. ENFORCEMENT ACTIONS i

VI. B.1. Base Civil Penalty .

The NRC imposes different levels of penalties for different severity levei violations ,

and different classes of licensees, contractors, and other persons. Tables '. A and 1B shove the base civil penalties for various reactor, fuel cycle, and materials programs. (Civil  :

- penalte,losued to individuals are determined on a case-by case basis.) The structurei these tables generally takes into account the gravity of the violation as a primary consideration and the ability to pay as a secondary consideration. Generally, operations 4 f

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e involving greater nuclear mater i lia nventor i es and greater potential consequences to the  !

public and licensee employees receive higher civil penalties. Regarding the secondary  ;

e f actor of ability of various classes of licensees to pay the civil penalties, it is not the NRC's >

intention that the economic impact of a civil penalty be so severe that it puts a licensee  !

out of business (orders, rather than civil penalties, are used when the intent is to suspend  !

l-or terminate licensed activities) or adversely affects a licensee's ability to safely conduct l licensed activities.1he deterrent effect of civil penalties is best served when the amounts of the penalties take into account a' licensee's ability to pay. In determining the amount of  ;

l civil penalties for licensees for whom the tables do not reflect the ability to pay or the t

_ gravity of the violation, the NRC will consider as necessary an increase or decrease on a ,

f j

case by case basis. Normally, if a licensea can demonstrate financial hardship, the NRC  !

l will consider payments ove_r time, including interest, rather than reducing the amount of the civil penalty. However, where a licensee claims financial hardship, the licensee will e

normally be required to address why it has sufficient resources to safely conduct licensed ,

i activities and pay license and inspection fees.

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TABLE 1 A BASE civil PENALTIES ~ {

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c. Test reactora, mills and uranium conversion z f acilities, contractors, waste disposal licensees, and industrial radiographers.......................$ 11,000 -

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C. Orders

5. Orders to non-licensees, including contractors and subcontractors, holders of NRC approvals, e.g., certificates of compliance, early site permits, standard design certificates, or applicants for any of them, ard to employees of any of the foregoing, are used when the NRC has identified deliberate misconduct that may cause a licensee to be in violation of an NRC requirement or where incomplete or inaccurate information is deliberately submitted or where the NRC loses its reasonable assurance that the licensee will meet NRC requirements with that person involved in licensed activities.

D. Related Administrative Actions in addition to the formal enforcement actions, Notices of Violation, civil penalties, and orden., the NRC also uses administrative actions, such as Notices of Deviation, Notices of Nonconformance, Confirmatory Action Letters, Letters of Reprimand, and Demands for information to supplement its enforcement program The NRC expects licensees and contractors to adhere to any obligations and commitments resulting from these actions and wili not hesitate to issue appropriate orders to ensure that these obligations and commitments are met.

1. Notices of Deviation are written notices describing a licensee's f ailure to satisfy a commitment where the commitment involved has not been made a legally binding requirement. A Notice of Deviation requests a licensee to provide a written explanatio statement describing corrective steps taken (or planned), the results achieved, and the date when corrective action will be completed.

2. Noticos of Noncur.formance are written notices describing contractors' f ailures to meet commitments which have not been made legally binding requirements by NRC.

An example is a commitment made in a procurement contract with a licensee as requir by 10 CFR Part 50, Appendix B. Notices of Nonconformances request non-licensees to provide written explanations or statements describing corrective steps (taken or pla the results achieved, the dates when corrective octions will be completed, and measures taken to preclude recurrence.

3. Confirmatory Action Letters are letters confirming a licensee's or contractor's agmement to take certain actions to remove significant concerns about health and sa safeguards, or the environment.

9 ,

Vill. ENFORCEMENT ACTIONS INVOLVING INDIVIDUALS Listed below are exarnples of situations which could result in enforcement actions involving individuals, licensed or unlicensed. if the actions described in these examples are taken by a 1: censed operator or taken deliberatel) by an unlicensed individual, enforcement action may be taken directly against the individual. However, violations involving willful conduct not amounting to ueliberate action by an unlicensed individual in these situations may result in enforcement action against a licensee that may impact an individual. The situations include, but are not limited to, violations that involve:

• Willfully causing a licensee to be in violation of NRC requirements.

• Willfully taking action that would have caused a licensee to be in violation of NRC requirements but the action did no'. do so because it was detected and corrective action was taken.

6 Recognizing a violation of procedural requirements and willfully not taking corrective action.

• Willfully defeating alarms which have safety significance.

• Unautt.arized abandoning of reactor controls.

• Dereliction of duty.

• Falsifying records required by NRC regulations or by the f acility licetise.

• Willfully providing, or causing a licensee to provide, an NRC inspector or investigator with inaccurate or incomplete information on a matter (naterial to the NRC.

10

l 4

e Willfully withholding safety significant information rather than making such

-information known to appropriate supervisory or techi n cal personnel in the licensee's [

orgadation.  !

e Submitting f alse information and as a result gaining unescorted access to a l

nuclear power plant.

l e Willfully providing f alse data to a licensee by a contractor or other person who  !

provides test or other services, when the data affects the licensee's complit.nce with l 10 CFR Part 50, Appendix'B, or other regulatory requirement. ,

e Willfully providing f alse certification that components meet the requirements of their intended use, such as ASME Code.

e Willfully supplying, by contractors of equipment for transportation of radioactive

- material, casks that do not comply with their certificates of compliance.  ;

X. ENFORCEMENT ACTION AGAINST NON LICENSEES The Commission's enforcement policy is also applicable to non-licensees, including t

contractors and subcontractors, holders of NRC approvals, e.g., certificates of compliance, early site permits, standard design certificates, quality assurance program approvals, or applicants for any of them, and to employees of any of the fr mgoing, who knowingly

- provide components, equipment, or other goods or services that relate to a licensee's

= activities subject to NRC regulation. The prohibitions and sanctions for any of these persons who engage in deliberate misconduct or knowing submission of incomplete or 11  !

t c - , - -

i d . j inaccurate information are provided in the ru l e on' deliberate misconduct, e.g.,10 CFR 7 t

l 30.10 and 50.5. i 1

Contractors who supply products or services provided for use in nuclear activities

are subject to certain requirements designed to ensure that the products or services >

supplied that could affect safety are of high quality. Through procurement contracts with l

licensees, suppliers may be required to have qualit) assurance programs that meet i

applicable requirements, e.g.,10 CFR Part 50, Appendix B, and 10 CFR Part 71, I

- Subpart H. Contractors supplying certain products or services to licensees are subject to

' the requirements of 10 CFR Part 21 regarding reporting of defects in basic components.

1 j

When inspections determine that violations of NRC requirements have occurred, or that contractors have f ailed to fulfill contractual commitments (e.g.,10 CFR Part 50, Appendix B) that could adversely affect the quality of a safety significant product or ,

a service, enforcement action will be taken. Notices of Violation and civil penalties will be used, as apprwriate, for licensee f ailures to ensure that their contractors have programs that meet applicable requirements. Notices of Vio!stion will be issued for contractors who b

violate 10 CFR Part 21. Civil penalties will be imposed against individual directors or t '

responsible officers of a contractor organization who knowingly and consciously f ail to provide the notice required by 10 CFR 21.21(b)(1). Notices of Nonconformance will be used for contractors who f all to meet commitments related to NRC activities.  ;

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I SUPPLEMENT l REACTOR OPERATIONS i C.6, A licensee f ailure to conduct adequate oversight of contractors resulting in the use of products or services that are of defective or indeterminate quality and that have safety significance; l

f SUPPLEMENT Vil MISCELLANEOUS MATTERS .

C.8. A f ailura to assure, as required, that contractors have an effective fitness for duty program; .

1 f

Dated at Rockville, Maryland, this day of 1997. .

D For The Nuclear Regulatory Commission.

John C. Hoyle, Secretary of the Commission.

R N

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ENCLOSURE 3 CONGRESSIONAL LETTERS l

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. UNITFC STATES

!.' $ NUCLEAR RE2ULATCRY COMMISSION L j WASHINGTON. o.C. 3084H001

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• e The Honc able James M. Inhofe, Chairman Subcommittee on Clean Air, Wetlands, Private Property and Nuclear Safety Committee on Environment and Public Works United States Senate Washington, DC 20510

Dear Mr. Chairman:

Enclosed for the information of the subcommittee is a copy of a notice of a final rule dealing with deliberate rnisconduct to be published in the Federal Reoister. The Nuclear Regulatory Commission (NRC) is amending its regulations to expand the Deliberate Misconduct Rule where it appears in 10 CFR Parts 30,40,50,60,61,70,72, and 110 and adds the rule to Parts 32,52, and 71. These modifications extend the rule to:

(1) applicants for NRC licenses; (2) applicants for, or holders of, certificates of compli (3) applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants; (4) applicants for, or holders of, certificate ,

regit ation; (5) applicants for, or holders of, quality assurance program approvals; an (6) the employees, contractors, subcontractors and consultants of the first five categorie '

of persons, so that they (May be subject to enforcement action, in addition, the sco 10 CFR 150.2 was changed to provide notice to the above categories of persons when  ;

conducting activities under reciptccity in areas of NRC jurisdiction.

The Deliberate Misconduct Rule was originally issued in 1991 (56 FR 40664). Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve deliberate conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's reouirements. The NRC believes that because there may be significant safety consequences from the intentional submittal of materially incomplete or inaccurate information or other deliberate wrongdoing by such persons, t categories of persons cited above also should be subject In addition, to enforcement the NRC's Enforcementaction under Comrnission's rules regarding deliberate misconduct.

Policy is modified concurrently to reflect these changes to the regulations.

The Commission is issuing the final rule for publication in the Eederal Reoister.

Sincerely, Dennis K. Rathbun, Diiector Office of Congressional Affairs

Enclosure:

, Federal Register Notice cc:. Senator Bob Graham.

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Subcommitta en Cle:n Air, Weti:nds, Private '

• Property cnd Nuclxt Safety

. Ccmmittro on Envircnment cnd Public Works

• United States Senate  :

Washington, DC 20510

Dear Mr. Chairman:

Enclosed for the information of the subcommittee is a copy of a notice of a final rule dealing with deliberate misconduct to be published in the _ Federal Egoister. The Nuclear  !

Regulatory Commisdon INRC) is amending its regulations to expand the Deliberate Misconduct Rule where it appears in 10 CFR Parts 30, 40, 50, 60, 61, 70, 72, and 110 and adds the rule to Parts 32,52, and 71. These modifications extend the rule to:

(1) applicants for NRC licenses; (2) applicants for, or holders of, certificates of compilance; (3) applicants for, or holders of, early site permits, standard des!gn certificat6ns, or combined licenses fcr nuclear power plants; (4) applicants for, or holders of, certificates uf registration; (5; a olH.nts for, or holders of, qualit / assurance program approvals; and (6) the employeet, cuntractors, subcontractors and consultants of the first five categories of persons, so that they may be subject to enforcement action. In addition, the scope of 10 CFR 150.2 was changed to provide notice tu the above categories of persons when conducting activities under reciprocity in areas of NRC jurisdiction.

The Deliberate Misconduct Rule was originally issued in 1991 (56 FR 40664). Deliberate miscenduct may involve providing information that is known to be incomplete or inaccurats in some respect material to the NRC, or it may involve deliberate conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirements. The NRC believes that because there may b6 significant safety consequences from the intentional submittal of materially '

incomplete or inaccurate informaticn or other deliberate wrongdoing by such persons, the categories of persons cited above also should he subject to enforcement action under the Commission's rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the regulations.

The Commission is issuing the final rule for publication in the Federal Bggigigr.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

Federal Register Notice See next page for Distribution cc: Senator Bob Graham S eh$ s concurrencer DOCUMENT NAME:0:\DIPALO\DELMISCN\DMC CONG.OR2 D:DRA D:f3ES OCA OFC:- WMB:DRA WMB:DRA _

ADiPalo:' SBahadur' JAMurphy* knapp DRathbun NAME:

07/31/97 08/05/97 /() / p,7 / /96 DATE: 06/20/97 ,

Yes - No Yes - No Yes - No COPY: ' Yes - No Yes No OFFICIAL RECORD COPY (RES File Code) GES

The Honorable Jam:s M. Inh:;fo 2 DISTRIBUTI(2N:

WMB Sub r/f NJensen, OGC RDBr/f SBaggatt, NMSS Ceritral f/c Mi.esar, ADM  ;

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• *, UNITED STATES y-o S NUCLEAR GECULATORY COMMISSION D 'I w AsHINGT oN. o.C. 30MH001

\...../

The Honorable Dan Schaefer, Chairman Subcommittee on Energy and Power Committee on Commerce United States House of Representatives Washington, DC 20515

Dear Mr. Cheirman:

Enclosed for the ininrmatinn of the subcommittee is a copy of a notice of a final rule dealing with deliberate misconduct to be published in the Federal Reafster. The Nuclear

' Regulatory Commission (NHC) a amending its regulations to expand the Deliberate Misconduct Rule where it appears in 10 CFR Parts 30, 40, 50, 60, 61, 70, 72, and 110 and adds the rule to Parts 32,52, and 71. These modifications extend the rule to:

(1) applicants for NRC licenses: (2) applicants for, or holders of, certificates of compliance; (3) applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants; (4) applicants for, or holders of, certificates of registration; (5) applicants for, or holders of, quality assurance program approvals; and (6) the employees, contractors, subcontractors and consultants of the first five categories of persons, so that tney may be subject to enforcement action. In addition, the scope of 10 CFR 150.2 was changed to provide notice to the above categories of persons when conducting activities under reciprocity in areas of NRC jurisdiction.

The Deliberate Misconduct Role was originally issued in 1991 (56 FR 40664). Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve deliberate ccnduct that causes or would have caused, if not dett cted, a licensee, certificate holder, or applicant to be in violat%n of any of the Commission's requirements. The NRC believes that because there may be significant safety consequences from the intentional submittal of materially incomplete or inaccurate information or other deliberate wrongdoing by such persons, the categories of persons cited above also should be subject to enforcement e:: tion under the Commission's rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the regulations.

The Commission is issuing the final rule for publication in the Federal Realster.

t Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

. Federal Register Notice cc:. Representative Ralph Hall

~ -' - - .

Subcommitt:e cn' Energy"and Pow;r ~

Committee cn Ctmm:rce Urlt:d i Stat:s House of R:pr:s:ntativ:s

. Washington, DC 20515 i

Dear Mr. Chairman:

Enclosed for the information of the subcommittee is a copy of a notica of a final rule dealing with deliberate misconduct to be published in the Federal Egoister. The Nuclear Regulatory Commission (NRC) is ameriding its regulations to expand the Deliberate Miscor. duct Rule where it appears in 10 CFR Parts 30, 40, 50, 60, 61, 70, 72, and 110 and addti the rule to Parts 32,52, and 71. These modifications extend the rule to:

(1) applicants for NRC licenses; (2) applicants for, or holders of, certificates of colapliance; (3) applicants for, or holders of, early -ite permits, standard design certifications,'or combined licenses for nucl6ar power pwnts; (4) applicants for, or holders of, certificates et registration; (5) applicants for, or holders of, quality assurance program approvals; and (6) the employees, contra': tors, subcontractors and :onsultants of the first five ca'egories of persons, so that they n.ay be subject to enforcerr.ent action. In addition, the scope of 10 CFR 150.2 was changed to provide notice to the above categories of persoras when -

conducting activities under reciprocity in areas of NRC jurisdiction.

The Deliberate Misconduct Rule was originally issued in 1991 (56 FR 40664). Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve deliberate conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in vio'ation of any of the Commission's requirements. The NRC believes that because there may be significant safety consequences from the intentional submittal of materially incomplete or inaccurate information or other deliberate wrongdoing by such persons, the categories of persons cited above also should be subject to enforcement action under the Commission's rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the regulations.

The Commission i issuing the final rule for publication in the Federal Reaister.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

Federal Register Notice See next page for Distribution cc: Representative Ratoh Hall DOCUMENT NAME:O:\DIPALO\DELMISCN\DMC-CONG.OR2 'See previous concurrences D:DRA , ftES D OCA OFO: WMB:DRA- WMB:DRA NAME: ADiPalo:' SBahador' JAMurpny' h app DRathbun 08/05/97 (O //f97 - //96 DATE: 06/20/97 07/31/97 Yes - No Yes No Yes - No COPY: Yes + No Yes - No OFFICIAL RECORD COPY g

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NRC AMENDING REQUIREMENTS GOVERNING DELIBERATE MISCONDUCT BY UNLICENSED PERSONS L

The Nuclear Regulatory Commitsion is adopting amendments to NRC regulations that established the Deliberate Misconduct Rule,in September 1991. The original rule f ailed to include a number of categories of persons who engage in activities within the Commission's subject matter jurisdiction. The amendments extend the Deliberate Misconduct Rule to six new categories of persons:

(1) applicants for NRC licenses; (2) applicants for, or holders of, certificates of compliance; (3) applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants; (4) applicants for, or holders of, certificates of registration; (5) applicants for, or holders of, quality assurance program approvals; and (6) the employees, contractors, subcontractors and consultants of the fi five categories of persons, so that they may be subject to enforcement action. Deliberate misconduct may involve providing information that is known to be incomp!ete or inaccurate in some ruspect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirements. The NRC believes that because there

-may be significant safety consequences from the ir,tentional submittal of materially incomplete or inaccurate information or other delibertte wrongdoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is bein 1

modified concurrently to reflect th'ese changes to the regulations.

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i Mr; Robe'rt P. Murphy General Counsel General Accounting Office

<- Room 7175 -

441_"G" Street, N.W.

Wash;ngton, DC 20548 '

Dear Mr. Murphy:

i Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996, '

- 5 U.S.C. 801, the Nuclear Regulatory Commission (NRC) is submitting a final rule to amend itT regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, and holders of, certificates of - '

compliance; applicants for, or holdsrs of, early site permits, standard design certifications, or combined licenses for nuclear power plants; applicants for, or holders of, certificates of registration; applirsnts for,' or in.lders of, quality assurance program approvals; and the employees, contrmaors, subcontractors, and consultants of the above five categories of persons, so that they may be subject to enforcement action for deliberate misconduct.

Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirements. The FM believes that because there may be significant safety consequences from the intentic..of submittal of incomplete or inaccurate information et other deliberate wrongdoing by such persons, these persons

- should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the reguistions.

We have determined that this rule is not a " major role" as defined in 5 U.S.C. 804(2). We have confirmed this determination with the Office 2 Management and Budget.

Enclosed is a copy of the final rule, which is being transmitted to the Offiae of the Federal Register for publication. The Regulatory Flexibility Certification is included in the final rule. >

A Regulatory Analysis has teen prepared for this final rule and is included in the Federal Register _ notice, however the benefits derived from the changes to the current regulation are similar to those provided by the Deliberate Misconduct Rule, which became effective on September 16,1991, Sincerely,

- Dennis K. Rathbun,' Director Offico of Congressional Affairs

Enclosure:

final Rule -

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=- - ---- -- .a-- _ _ _ _ _ _ _ _ _

Mr. R&rt P. Murphy 8en:rcl Couns:1 3 Gen:rcl Accounting Office l Room 7175 441 "G" Street, N.W.

tNashingten, DC 20548

Dear Mr. Murphy:

Pursuarn to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801, the Nuclear Regulatory Commission (NRC) is submitting a final rule to amend its regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, anc8 holders of, certificates of compliance; applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants; applicants for, or holders of, certificates of registration; applicants for, or holders of, quality assurance program approvels; and the employees, contractors, subcontractors, and consultants of the above five categories of persons, so that they may be subject to enforcement action for deliberate misconduct.

Deliberate misconduct rnay involve providing information that is known to be incomple:e or it:accurata in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirements. The NRC believes that because there may be significant safety consequences from the intentional submittal of incomplete or inaccurate information or other deliberate wrongdoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct, in addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the regulations.

We have determined that this rule is not a " major rule" as defined in 5 U.S.C. 804(2). We have confirmed this determination with the Office of Management and Budget.

Enclosed is a copy of the final rule, which is being transmitted to the Office of the Federal Register for publication. The Regulatory Flexibility Certification is included in the final rule.

A 9egulatory Analysis has been prepared for this final rule and is included in the Federal l ti m., ester notice, however the benefits derived from the changes to the current regu a on are similar to those provided by the Deliberate Misconduct Rule, which became effective on September 16,1991.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Aff airs

Enclosure:

Final Rule pjSTRIBUTION: Central f/c LRiani WMB r/f PNorlan

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=The Honorable Newt Gingrich -

Speaker of the United States House of Represnetatives Washington, DC 20515

Dear Mr. Speaker:

Pursuant to Subtitle E of the Small Business Reguiatory Enforcement Fairness Act of.1996, 5 U.S.C. 801, the Nuclear Regulatory Commission (NRC) is submitting a final rule to amend its regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenc.es; applicants for, and holders of, certificates of

. compliance; applicants for, or holders of, early site permits; standard design certifications, or' combined licenses for nuclear power plants; applicants for, or holders of, certificates of

- registration; applicants for, or holders of, quality assurance program approvals; and the employees, contractors, subcontractors, ano consultants of the above five categories of persons, so that they may be subject to enforcement action for deliberate misconduct.

Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirements. The NRC believes that because there may be significant safety consequences from the intentional. submittal of incomplete or inaccurate information or other deliberate wrongdoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct. In addition, the NRC's Enforcement Policy is modified concurrently to reflect these changes to the regulations.

We have determined that this rule is not a " major rule" as defined in 5 U.S.C. 804(2). We have confirmed this determination with the Office of Management and Budget.

Enclosed is a copy of the final rule, which is being transmitted to the Office of the Federal Register for publication. The Regulatory Flexibility Certification is included in the final rule.

A Regulatory Analysis has been prepared for this final rule and is included in the Federal Register notice, however the benefits derived.from the changes to the current regulation are similar to those provided by the Deliberate Misconduct Rule, which became effective on September 16,-1991.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

- Final Rule

, T,h2 Honor:bla N;wt Gingrich

., Spe:.kcr of the Unit;d Ststcs House of Represnetatives -

Washington, DC 20515

Dear Mr. Speal.er:

Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801, the Nuclear Regulatory Commission (NRC) is submitting a final rule to -

amend its regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, and holders of, certificates of compliance; applicants for, or holders of, early site permits, standard design certifications, or .:ombined licenses for nuclear power plants; applicants for, or holders of, certificates of registration; applicants for, or holders of, quality assurance program approvals; and the employees, contrectort, subcontractors, and consultants of the above five categor;es of persons, so that t r(( av be subject to enforcement action for deliberate misconduct.

Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in

. violation of any of the Commission's requirements. The NRC believes that because there nsay be significant safety consequences from the intentional submittal of incomplete or inaccurate information or other deliberate wrongdoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct, in addition, the NRC's Enforcement Policy is modified concurrentiy to reflect these changes to the reguletions.

We have determined that this rule it, not a " major rule" as defined in 5 U.S.C. 804(2). We have confirmed this determination with the Office of Management and Bu .get.

Enclosed is a copy of the final rule, which is being transmitted to the Office of the Federal Register for publication. The Regulatory Flexibility Certification is included in the final rule.

A Regulatory Analysis has been prepared for this final rule and is included in the Federal Register notice, however the benefits derived from the changes to the current regulation are similar to those provided by the Deliberate Misconduct Rule, which became effective on September 16,1991.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

Final Rule DISTRIBUTION: Central f/c LRiani WMB r/f PNorian See previous concurre .ces DOCUMENT NAME:0:\CIPALO\DELMISCN\DMC LTR.OR2 WM8. DRA

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The Honorable Al Gore President of the United .

- States Senate Washington, DC 20510 ,

Dear Mr. President:

Pursuant to Sub:itle E of the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801, the Nuclear Regulatory Commission (NRC) is submitting a final rule to amend its regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, and holders of, certificates of compliance; applicants for, or holders of, early site permits, standard design certifications,

. or combined licenses for nuclear power plants; applicants for; or holders of, certificates of registration; applicants for, or holders of, quality assurance program approvals; and the employees, contractors, subcontractors, and cont;ultants of the above five categories of persons, so that they may be subject to enforcement action for deliberate misconduct.

Deliberate misconduct may involve providing information that is known to be incomplete or inaccurate in some respect material to the NRC, or it may involvt. conduct that causes or i would have caused, if not detected, a licensee, certificate holder, or applicant to be in ,

violation of any of the Commission's requirements. The NRC believes that because there may be significant safety consequences from the intentional submittal of incomplete or inaccurate information or other deliberate wrongctoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding deliberate misconduct. In addition, the NRC'a Enforcement Policy is modified cont.orrently to reflect these changes to the regulations.

We have determined that this rule is not a " major rule" as defined in 5 U.S.C. 804(2). We have confirmed this determination with the Office of Management and Budget.

Enclosed is a copy of the final rule, which is being transmitted to the Office of the Federal Register for publication. The Regulatory Flexibility Certification is included in the final rule.

A Regulatory Analysis has been prepared for this final rule and is included in the Federal Register notice, however the benefits derived from the changes to the current regulation are'similar to those provided by the' Deliberate Misconduct Rule, which became effective

. on September 16,1991.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs  ;

Enclosure:

Final Rule I

The Honorcbla Al Gora

• ) PTrid:nt of the Unit;d States Senate Washin0 ton, DC 20510

Dear Mr. President:

Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801, the Nuc. ear Regulatory Commission (NRC) is submitting a final rule to amend its regulations to extend the Deliberate Misconduct Rule to six categories of persons: applicants for NRC licenses; applicants for, and holders of, certificates of compliance; applicants for, or holders of, early site permits, standard deaign certifications, or combined licenses for nuclear power plants; applicants for, or holders of, certificates of registration, applicants for, or holders of, quality assurance program approvals; and the employees, contractors, subcontractors, and consultants of the above five categories of perscns, so that they m sy be subject to enforcement action for deliberate miscotiduct.

Deliberate misconduct may involve providing irformation that is known to be incomplete or inaccuiete in some respect material to the NRC, or it may involve conduct that causes or would have caused, if not detected, a licensee, certificate holder, or applicant to be in violation of any of the Commission's requirement:i. The NRC believes that because there may be significant safety consequences from the intentional submittal of incomplete or inaccurate !nformation or other deliberate wrongdoing by such persons, these persons should be subject to enforcement action under the Commission's existing rules regarding In addition, the NRC's Enforcement Policy is modified concurrently deliberate miaconduct.

to reflect these cht.nges to the regulations.

We have deternsined that this rule is not a " major rule" as defined in 5 U.S.C. 8'04(2). We have confirmed this determination with the Office of Management and Budget.

Enclosed is a copy of the final rule, which is being transmitted to the Office of the Federal Register for publication. The Fiegulatory Flexibility Certification is included in the final rule.

A Regulatory Analysis has been prepared for this final rule and is included in the Federal Register notice, however the benefits derived from the changes to the current regulation are similar to those prtcvided by the Deliberate Misconduct Rule, which became effective on September 16,1991.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

Final Rule DIST848UTIONE Centesi f!e Ullard WM8 ,/f PNom en

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