ML20211H534
| ML20211H534 | |
| Person / Time | |
|---|---|
| Issue date: | 07/26/1999 |
| From: | Mcgaffigan E NRC COMMISSION (OCM) |
| To: | Vietticook A NRC OFFICE OF THE SECRETARY (SECY) |
| Shared Package | |
| ML20211H527 | List: |
| References | |
| SECY-99-165-C, NUDOCS 9909020116 | |
| Download: ML20211H534 (3) | |
Text
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NOTATION VOTE RESPONSE SHEET TO:
Annette Vietti-Cook, Secretary FROM:
COMMISSIONER MCGAFFIGAN
SUBJECT:
SECY-99-165 - FINAL STANDARD REVIEW PLAN REGARDING FOREIGN OWNERSHIP, CONTROL, OR DOMINATION OF APPLICANTS FOR REACTOR LICENSES Approved X
Disapproved Abstain Not Participating f
COMMENTS:
See attached comments.
b, y
SIGNATURE PU (/
}G, [4'11 DATJE V
Entered on "AS" Yes Y No 7:!' Po#4 L?c t
CORRESPONDENCE PDR 9 98902 0llh
Commissioner McGaffigan's comments on SECY 99-165:
I approve both this draft final SRP and publication in the Federal Register of the SECY paper's discussion of the comments received on the draft SRP. The SRP appears at a critical time in the restructuring of the power industry and should help interested parties understand better how we will perform our regulatory duties under the foreign ownership and control provisions of the Atomic Energy Act (96103d and 104d).
'I would suggest that material could be added to this SRP, or placed in some other
. convenient place, to give the public a clearer idea of how we have applied.the Act's.
related requirement that the grant of a license' not be inimical to the common defense and security. Such material would be particularly useful at a time when we are asking Congress to remove the foreign ownership and control provisions from $9103d and 104d of the Atomic Energy Act, while preserving the inimicality provisions. As the SRP says, it "does not address all matters relating to a determination of whether issuance of a given license would be inimical to the common defense and security." (Page 1.) In fed the SRP says only that an applicant that may pose a risk to national security by reason of.even limited foreign ownership would be ineligible for a license (page 5). This one remark is clearly tied to the foreign ownership and control context and so does not convey anything about what factors other than foreign ownership and control might enter into our judgments about inimicality.
Yet we have had a great deal of experience in making inimicality judgments, notably in regulating AEA materials, conceming which there are only inimicality provisions, such as G 57c(2) for special nuclear material, and no AEA prohibition against foreign ownethip and control. Based solely on the inimicality provision in 9 57c(2), the Commission would never allow any ownership of a fuel cycle facility by Iran, Iraq, Libya, North Korea, India, Pakistan, etc. It might help to say even such a simple thing as that, based on the inimicality provisions of ff.103d and 104d, we would not issue a license to any entity with any ownership from such nations as Iran, Iraq, Libya, North Korea, India, Pakistan, etc. This could be done as a footnote on page 5 (see attached).
If my suggestion.for a footnote on page 5 does not meet with the_ approval of the majority, I would not wa' t the SRP to be delayed any further, but I would want the staff n
to propose some way of dealing promptly.with how we could make clear to the public how we make inimicality judgments pursuant to the final sentence of 99103d and 104d.
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relationships where the will of one party is subjugated to the will of another. General
. Electric Co.,3 AEC at 101.
A foreign interest is defined as any foreign govemment, agency of a foreign govemment, or representative of a foreign govemment; any form of business enterprise or legal entity organized, chartered, or incorporated under the laws of any country other that the U.S. or its possessions and trust territories; any person who is not a citizen or national of the U.S.; and any U.S. interest effectively controlled by one of the above foreign entities.
The Commission has stated that in context with the other provisions of Sectiortp04d.
the foreign control limitation should be given an orientation toward safeguarding the national defense and security. Thus, an applicant that may pose a risk to national security by reason of even limited foreign ownership would be ineligible for a licens Even though a foreign entity contributes 50%, or more, of the costs of constructing a reactor, participates in the project review, is consulted on policy and cost issues, and is entitled to designate personnel to design and construct the reactor, subject to the approval and direction of the non-foreign applicant, these facts alone do not require a finding that the applicant is under foreign control.
An applicant that is partially owned by a foreign entity, for example, partial ownership of 50% or greater, may still be eligible for a license if certain conditions are imposed, such as requiring that officers and employees of the applicant responsible for special nuclear material must be U.S. citizens.
Where an applicant that is seeking to acquire a 100% interest in the facility is wholly owned by a U.S. company that is wholly owned by a foreign corporation, the applicant j
will not be eligible for a license, unless the Commission knows that the foreign parent's stock is "largely" owned by U.S. citizens. If the foreign parent's stock is owned by U.S.
citizens, and certain conditions are imposed, such as requiring that only U.S. citizens within the applicant organization be responsible for special nuclear material, the applicant may still be eligible for a license, notwithstanding the foreign control limitation.
If the applicant is seeking to acquire less than a 100% interest, further consideration is required. Further consideration will be given to: (1) the extent of the proposed partial ownership of the reactor; (2) whether the applicant is seeking authority to operate the reactor; (3) whether the applicant has interlocking directors or officers and details concoming the relevant companies; (4) whether the applicant would have any access to restricted data; and (5) details concoming ownership of the foreign parent company.
I M or example, based solely on the inimicality provision in the last sentence of 66103d F
and 104d, no license would be issued to any applicant with any ownership by any foreign interest with ties to a nation of proliferation concem or to a nation whom the Secretary of State has found to support terrorism.
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