ML20210C016

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Forwards Corrected Pp 3 of SECY-98-252.Correction Makes Changes to Footnote 3 as Directed by SRM on SECY-98-246
ML20210C016
Person / Time
Site: Three Mile Island Constellation icon.png
Issue date: 03/01/1999
From:
NRC OFFICE OF THE SECRETARY (SECY)
To:
References
SECY-98-246-C, SECY-98-252, SECY-98-252-ERR, SECY-98-252-R, NUDOCS 9907230309
Download: ML20210C016 (2)


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I March 1,1999 CORRECTION NOTICE TO ALL HOLDERS OF SECY-98-252 - PRELIMINARY STAFF VIEWS CONCERNING ITS REVIEW OF THE FOREIGN OWNERSHIP ASPECTS OF AMERGEN. INC.'S PROPOSED PURCHASE OF THREE MILE ISLAND. UNIT 1 PLEASE REPLACE PAGE 3 OF SECY-98-252 WITH THE ATTACHED R&LACEMENT l

PAGE. THIS CORRECTION MAKES CHANGES TO FOOTNOTE 3 AS DIRECTED BY THE SRM ON SECY-98-246.

ATTACHMENT:

AS STATED THE SECRETARIAT 1

eL- 'i 9907230309 990301 PDR SECY 98-252 R PDR

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4 L The Commissioners ,

i prepared by the Office of the General Counsel (OGC) (the OGC memorandum).2 Previous l Commission ' decisions involving the limitation on foreign ownership, control, or domination have l focused on protection of common defense and security (e.g., requiring that only U.S. citizens be i responsible for handling special nuclear material). The Commission has never adopted any hard and fast criteria, such as the cutoff percentage of foreign stock ownership, for determining whether a particular corporate arrangement will violate the statutory foreign domination / control limitation. The Commission has indicated that, rather than apply any set rule of stock ownership percentages, it will look at the many aspects of corporate existence and activity in which control or domination by another would be normally manifested. Notwithstanding the Commission's reluctance to specify limitations of percentages of stock ownership by foreign entities, the few agency precedents indicate that the Commission has generally approved license transfer requests resulting in up to 50 percent foreign ownership of the licensee, depending on measures taken to ensure common defense and security and public health and safety.' i A 1973 Atomic Energy Commission (AEC) decision relating to the transfer of several licenses issued under Section 104d of the AEA appears to be particularly analogous to the situation of AmerGen. This decision was cited in the MLB paper. The Commission approved a request by the Gulf Oil Corporation (Gulf), a U.S. corporation, to transfer three TRIGA research reactors and the Barnwell spent fuel reprocessing plant then under construction to a newly formed partnership, the General Atomic Company, that was 50 percent owned by Gulf and 50 percent l

2 Note:' The OGC memorandum was prepared under attomey-client privilege. The ,

memorandum, references to it in this Commission paper, and any attachments to the memorandum not previously released should not be released publicly unless the Commission i determines otherwise. The Commission precedents themselves are public documents.  !

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The Commission has generally focused on foreign control or domination as opposed to foreign ownership, per se. However, the Commission has disapproved trancfers involving 100 i percent foreign ownership of the licensee, even where all licensee activities relating to common defense and security considerations would be controlled exclusively by U.S. nationals. This raises the issue of just how much of AmerGen's total ownership is foreign as a result of a percentage of PECO's stock being owned by foreign investors. As a company with widely held stock, it is likely but probably not readily subject to confirmation that PECO's stock is owned to ;

some small degree by foreign individuals or entities. Until it receives any information to the  :

contrary, the staff is working under the assumption that the Commission's previous decisions I that foreign ownership, per se, is not prohibited by the AEA when 4 enes not lead to foreign control or domination still hold. The staff will request AmerGen tc enit any relevant

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information that it can obtain with respect to this issue. Recognizing that shares change hands '

, rapidly in the intemational equity markets, the staff usually does not evaluate power reactor licensees to determine the degree to which foreign entities or individuals own relatively small I numbers of shares of the licensees' voting stock. .

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