ML23156A047

PR-030, 032, 040, 50, 52, 60, 61, 70, 71, 110, 150 - 61FR51835 - Deliberate Misconduct by Unlicensed Persons

ML23156A047
Person / Time
Issue date:	10/04/1996
From:	Hill W NRC/SECY
To:
References
61FR51835, PR-030, PR-032, PR-040, PR-050, PR-052, PR-060, PR-061, PR-070, PR-071, PR-110, PR-150
Download: ML23156A047 (1)

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DOCUMENT DATE:

TITLE:

CASE

REFERENCE:

KEYWORD:

ADAMS Template: SECY-067 10/04/1996 PR-030,032,040,50,52,60,61,70,71, 110,150 - 61 FR51835 -

DELI BERA TE MISCONDUCT BY UNLICENSED PERSONS PR-030,032,040,50,52,60,61,70,71, 110,150 61FR51835 RULEMAKING COMMENTS Document Sensitivity: Non-sensitive - SUNSI Review Complete

STATUS OF RULEMAKING PROPOSED RULE:

PR-030,032,040,50,52,60,61,70,71,110,150 OPEN ITEM (Y/N) N RULE NAME:

DELIBERATE MISCONDUCT BY UNLICENSED PERSONS PROPOSED RULE FED REG CITE:

61FR51835 PROPOSED RULE PUBLICATION DATE:

10/04/96 ORIGINAL DATE FOR COMMENTS: 12/18/96 NUMBER OF COMMENTS:

EXTENSION DATE:

I I

6 FINAL RULE FED. REG. CITE: 63FR01890 FINAL RULE PUBLICATION DATE: 01/13/98 NOTES ON: NRC PROPOSING TO REVISE REGULATIONS TO EXTEND DELIBERATE MISCONDUC TATUS T RULE TO SIX CATEGORIES.

FR CORRECTION, 63FR13773, PUB. 3/23/98.

F RULE:

FILE ON Pl.

HISTORY OF THE RULE PART AFFECTED: PR-030,032,040,50,52,60,61,70,71,110,150 RULE TITLE:

DELIBERATE MISCONDUCT BY UNLICENSED PERSONS PROPOSED RULE SECY PAPER: 96-184 FINAL RULE ECY PAPER: 97-252 PROPOSED RULE DATE PROPOSED RULE SRM DATE:

09/11/96 SIGNED BY SECRETARY:

09/30/96 FINAL RULE SRM DATE:

DATE FINAL RULE 12/12/97 SIGNED BY SECRETARY:

01/06/98 STAFF CONTACTS ON THE RULE CONTACTl: ANTHONY DIPALO CONTACT2:

MAIL STOP: T-9F-31 PHONE: 415-6191 MAIL STOP:

PHONE:

DOCKET NO. PR-030,032,040,50,52,60,61,70,71,110,150

{61FR51835)

In the Matter of DELIBERATE MISCONDUCT BY UNLICENSED PERSONS DATE DATE OF TITLE OR DOCKETED DOCUMENT DESCRIPTION OF DOCUMENT 10/01/96 09/30/96 10/17 /96 11/08/96 11/13/96 12/19/96 01/02/97 10/11/96 11/04/96 11/07/96 12/18/96 12/18/96 FEDERAL REGISTER NOTICE - PROPOSED RULE COMMENT OF JAi CORPORATION {E. R. JOHNSON) {

COMMENT OF TOLEDO COALITION FOR SAFE ENERGY

{CHARLENE JOHNSTON) {

2)

COMMENT OF FAWN SHILLINGLAW {

3)

COMMENT OF NUCLEAR ENERGY INSTITUTE

{ROBERT W. BISHOP, V.P.) {

4)

COMMENT OF COMMONWEALTH EDISON

{JOHN C. BRONS, VICE PRESIDENT) {

5)

1) 1/03/97 12/18/96 COMMENT OF SOURCE PRODUCTION & EQUIPMENT CO., INC.

{R. D. DICHARRY, PRESIDENT) {

6) 01/12/98 01/06/98 FEDERAL REGISTER NOTICE - FINAL RULE 03/31/98 03/17/98 FEDERAL REGISTER NOTICE - FINAL RULE; CORRECTION

7590-01-P Nuclear Regulatory Commission 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72, 110, and 150 RIN 3150-AF35 Deliberate Misconduct by Unlicensed Persons; Correction AGENCY: Nuclear Regulatory Commission.

DOCKETNtlfflER PROPOSED RULE PR

( 6/ F~ 5183---5~--

ACTION: Final rule; correction.

SUMMARY

This document corrects a notice appearing in the Federal Register on January 13, 1998 (63 FR 1890). This action is necessary to correct an erroneous citation.

FOR FURTHER INFORMATION CONTACT: David L. Meyer, Chief, Rules and Directives Branch, Division of Administrative Services, Office of Administration, Washington, D.C. 20555-0001, telephone 301-415-7162, e-mail dlm1@nrc.gov.

SUPPLEMENTARY INFORMATION:

On page 1890, in the third column, in the 16th line from the top, "71.az" is corrected to read "71.7(a)."

ft Dated at Rockville, Maryland, this / 7,..:.---day of March 1998.

For the Nuclear Regulatory Commission David L. Meyer, Chief Rules and Directives Branch Division of Administrative Services Office of Administration (J,J. hl 3/~3/"Js-J (p3F~ I 3773

DOCKET N BER PA"'"""~ED RULE 3~ 3;;2 taJ.

(,IF~ s 1~3 5)

NUCLEAR REGULATORY COMMISSION "98 JAN 12 PS :43 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72, 116Ea~ 1 '50 ~Ecr-:c~*,-,i i'f RULL ~1: '\\f<J 1,.;

,.! 4 )

RIN: 3150_AF35 ADJUDIC/\\1 :(1,:* ::;TAf-F Deliberate Misconduct by Unlicensed Persons AGENCY: Nuclear Regulatory Commission.

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, 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 consultants of the above five categories of persons. This amendment would subject these categories of persons 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.

{J.JJ. tm,/13/'IK J

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f~<Vu.;J-l;JJ /99g-EFFECTIVE DATE: This final rule is effective on (inseFt ao dovs fFel"l'I elate ef i,ublieetio1, in t-Re Feeler-81 RegisteF)

FOR FURTHER INFORMATION CONTACT: Tony DiPalo, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, telephone (301) 415-6191, e-mail, ajd@nrc.gov.

SUPPLEMENTARY INFORMATION:

Background

On August 15, 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, and 110. 7b, which 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, of any licensee. In addition, 10 CFR 150.2, Scope, provides notice to persons conducting activities under reciprocity in areas of NRC jurisdiction that they are subject to the rule (.s..e.e_ 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 material to the NRC.

2

Currently, the Deliberate Misconduct Rule does not apply to:

(1) Applicants for NRC licenses; (2) Applicants for, or holders of, certificates of compliance issued under 10 CFR Parts 71 and 72, including those for dry cask storage; (3) Applicants for, or holders of, early site permits, standard design certifications, or combined licenses for nuclear power plants issued under 10 CFR Part 52; (4) Applicants for, or holders of, certificates of registration issued under Parts 30 and 32; (5) Applicants for, or 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.

To ensure that these persons are subject to enforcement action for wrongdoing under the Deliberate Misconduct Rule, on October 4, 1996 the NRC issued a proposed rule to extend the rule to them (61 FR 51835). This final rule will also add the Deliberate Misconduct Rule to 10 CFR Parts 52 and 71 where it currently does not appear.

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 5 5 because applicants for, and holders of, reactor operators' licenses are already subject to this.rule as employees of 10 CFR Part 50 licensees. Moreover, licensed operators 3

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.

Discussion It is important that all information 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 "[a] license may be revoked for any material false statement in the application or any statement of fact required (by statute or regulation]

... " The Commission has promulgated rules concerning completeness and accuracy of 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(al, 50.9(al, 60.10(a), 61.9a(a),

70.9(al, 71.az, 72.11 (a), 76.9(al and 110.7a(a)). Similarly, subsection (bl of each of these sections, which deals with notification to the Commission of significant safety 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 appropriate, referral to the Department of Justice for consideration for criminal 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 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, 4

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.

Incomplete or inaccurate information has potential safety significance, whether submitted before or after a license, certificate, permit, or approval has been issued. The Commission has clearly emphasized the importance of applications containing accurate information; e.g., "[The Commission] cannot overstate the importance of a licensee's or an applicant's duty to provide the Commission with accurate information." Randall C. Orem.

Q....Q.., CLl-93-14, 37 NRC 423 ( 1993). The Qumi case involved a consultant to an applicant for a license who provided inaccurate information that was included in the license application and the Commission found that information as to the status of the facility was material to the licensing decision. ld.. at 428.

The Commission believes that there may be significant safety consequences from the deliberate submission of false or incomplete information or other deliberate wrongdoing 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 submitted to the NRC for approval but is supported by deliberately falsified data that mask 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 false 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 deter the deliberate submittal of materially false or inaccurate information by those entities not currently covered by the rule.

5

The Commission is amending the Deliberate Misconduct Rule each place it appears 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, certificates of registration issued under Parts 30 and 32; and to applicants for, and holders of, quality assurance program approvals issued under Part 71; and to the employees, contractors, subcontractors and consultants of all the above categories of persons. This would include, for example, a consultant engaged by an applicant to prepare a license application for such activities as radiography, well logging, irradiation, and teletherapy. It would also apply to a consultant preparing an application for a certificate for a spent fuel cask, or individuals conducting performance tests to support such an application.

The 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 change to improve readability by altering the phrase "but for detection" to "if not detected" where the phrase appears in each rule, but intends no substantive change by this revision. 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 Commission's jurisdiction and may deter such behavior as well.

6

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; applicants for, and holders of, certificates of registration issued under Parts 30 and 32; and applicants for, and holders of, quality assurance program approvals issued under Part 71; and to the employees, contractors, subcontractors and consultants of all the above categories of persons, implements the Commission's authority under the AEA to issue regulations and orders to any person {defined in Section 11 s 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 161 i of the AEA provides broad authority to issue such 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 161 b 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 civil penalty,...

7

The licensing provisions listed in Section 234a generally prohibit the possession, use, receipt, or transfer of nuclear materials or facilities unless authorized by and in accordance with a license.

The amendments are made under the authority of sections 161 b and i and the above-identified licensing provisions in Section 234. The changes apply to any person in the categories enumerated above who engages in deliberate misconduct, or who deliberately submits materially incomplete or inaccurate information, as provided in the rule.

By imposing a direct prohibition on unlicensed persons, the Commission may be able to exercise its Section 234 authority to impose civil penalties on unlicensed persons when they deliberately cause violations of requirements issued under the licensing provisions enumerated in Section 234. In cases when the Commission issues an order (other than an order imposing a civil penalty) to a person based on deliberate misconduct, 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 available for violations of such an order. In addition, criminal sanctions under Section 223 of the AEA are available for willful violations of orders and regulations issued under sections 161 b and i. Injunctions are also available under Section 232 of the AEA for violations of Commission orders.

Summary of Public Comments On December 18, 1996, the comment period for the proposed amendments to the Deliberate Misconduct Rule closed. The NRC rece:ived 6 comments on the proposed rule which are addressed below. One comment, in addition to favoring speedy adoption of the 8

proposed rule, requested information on the status of NRC enforcement cases against certain dry cask storage vendors 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 is provided below.

Comment: One utility commenter was concerned that the proposed revisions to the 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 licensees provide information to the NRC staff to support teleconferences or meetings and where 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 occurred. A second issue raised by this commenter pertained to how potentially erroneous information in a Safety Evaluation Report could result in a conclusion reached by the NRC staff that since this erroneous information is inconsistent with that provided in the licensee's submittal, the licensee committed willful misconduct.

Response: The NRC's completeness and accuracy rules require that all information provided to the Commission shall be complete and accurate in all material respects ( 10 CFR 30.9, 40.9, 50.9, etc.). The deliberate submission of information which is incomplete or inaccurate in material respects, where the submitter of the information knows of the incompleteness or inaccuracy, may be considered deliberate misconduct. However, the submission of information acknowledged to be incomplete would not be considered deliberate misconduct if it is made in good faith and based on the best information 9

available, but is corrected later based on additional information or analysis. The NRC's General Statement of Policy and Procedures for Enforcement Actions (NUREG-1600)

(Enforcement Policy) points out that a citation is not made if an initial submittal was 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 of the Enforcement Policy.

Finally, the Commission does not take lightly its responsibility in this area and carefully considers each action involving an individual. As the Commission stated in the 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 personal liability for mistakes. The Commission realizes that people may make mistakes while acting in good faith.

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

Comment: One commenter, the Nuclear Energy Institute (NEI), believes that the NRC is exceeding its statutory authority under the Atomic Energy Act of 1954 (the AEA) in promulgating these amendments to the Deliberate Misconduct Rule because, in the view of NEI, authority over non-licensee persons was not provided by Congress other than in

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

Response: The Commission considered, but rejected, the objection that it did not have jurisdiction over non-licensees at the time it issued the original Deliberate Misconduct Rule. See 56 FR 40664, (1991 ). As the Commission stated:

In enacting Section 161 of the 1954 Act, Congress conferred uniquely broad and flexible authority on the Commission. Specifically, Congress authorized the Commission in Section 161 to 'prescribe such * *

• regulations * *

• as it may deem necessary to govern any activity authorized pursuant to [the 1954 Act], in order to protect health and minimize danger to life 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 in personam jurisdiction, it is appropriate to look to the scope of subject matter jurisdiction in order to determine the scope of in personam 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 its 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 11

are all persons who, in some way, engage in activities within NRC's subject matter jurisdiction. Thus, the Commission discerns no statutory prohibition on making these persons subject to the restrictions of the Deliberate Misconduct Rule.

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

This statute allows the imposition of criminal penalties for persons who, in1fil.ali.a, knowingly and willfully make false statements to an agency of the Federal Government.

There are several reasons why this enforcement option is not an adequate substitute for the Deliberate Misconduct Rule. First, 18 U.S.C. § 1001 punishes deliberate false statements but does not cover the types of deliberate misconduct captured by Section a( 1 l of the rule. Second, the civil enforcement penalties available to the NRC for violations of its rule, precisely because they are less drastic than criminal penalties, are more flexible and, thus, are more likely to be used in appropriate cases, affording the NRC greater ability to deter and remedy deliberate misconduct.

Comment: NEI 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 NRC 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 sufficiently clear to inform the public of the elements of the prohibited action.

Response: The Commission disagrees with the commenter's assertion that the rule is overly broad. The rule specifies that the persons who are delineated as being subject to the rule must knowjngly provide components, materials or other goods and services that 12

relate to, e.g., a licensee's or certificate holder's activities subject to NRC regulation. 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 original Deliberate Misconduct Rule, "a person with the requisite knowledge who deliberately provides false or inaccurate information that is material to the NRC presents a health and safety concern within the NRC's regulatory sphere." 56 FR 40670. The fact that no actual violation has occurred, or would have occurred but for detection, has no bearing 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 fact renders the standard overly broad.

Comment: One commenter, the JAi Corporation, proposed that the scope of the proposed rule be broadened to include 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 unfairness 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.

Response: Under 10 CFR Part 21, certain categories of persons, e.g., individual directors or responsible officers of a corporation, must notify the NRC when they obtain certain types of information; e.g., information concerning defects in components which 13

could cause a substantial safety hazard. When such persons provide information to the 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 failure 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 failure to comply or defect to the NRC. Further, the Deliberate Misconduct Rule makes no distinction between 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 (QA/QC) programs which are required under 10 CFR Part 32 for the manufacture and distribution of radiography equipment. The commenter recognizes that because these 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 QA/QC 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 to certificate 14

holders and applicants, and to their employees, contractors and subcontractors, not only 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 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 knowingly 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: One 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.

Response: Insofar as certificate holders are contractors to licensees (and certificate holders' contractors and subcontractors are subcontractors to licensees), the commenter is correct. Thoc,e certificate holders, and their contrnctors and subcontractors, are covered by the present rule. However, the NRC does not require the existence of a contract as a 15

prerequisite to the issuance of a Certificate of Compliance (~ 72.236; 72.238). Thus, it is possible for a certificate holder not to be a contractor to a licensee. The amended rule will cover those certificate holders.

Criminal Penalties 16

For purposes of Section 223 of the Atomic Energy Act (AEA), the Commission is issuing the final rule under one or more of sections 161 b, 161 i or 161 o of the AEA. Willful violations of the rule will be subject to criminal enforcement.

Environmental Impact: Categorical Exclusion The NRC has determined that this final rule relates to enforcement matters and, therefore, falls within the scope of 10 CFR 51. 1 0(d). Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this final rule.

Paperwork Reduction Act Statement 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.). 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, 3150-0036, and 3150-0032.

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 0MB control number.

Compatibility of Agreement State Regulations 17

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 Program," and "Policy Statement on 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 categorization 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 objectives 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 and resolution of comments, the staff will submit final recommendations to the Commission for approval.

Regulatory Analysis The Nuclear 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 license or certificate to be in violation of the Commission's requirements. On August 15, 1991 (56 FR 40664), the NRC promulgated 18

the Deliberate Misconduct Rule which put licensed and unlicensed persons on notice that they may be subject to enforcement action for deliberate misconduct that causes or, if not detected, would cause a licensee to be in violation of any of the Commission's requirements or for deliberately providing to the NRG, a licensee or a contractor information that is incomplete or inaccurate in some respect material to the NRG. However, the Deliberate Misconduct Rule does not specifically apply to: (1) applicants for NRG 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 NRG staff issued an Order Revoking License to Dr. Randall C. Orem after the NRG staff learned that information in his license application was false and that the application had been prepared by a consultant who had provided the false information. ~

Randall C. Orem. D.O., CLl-93-14, 37 NRG 423 (1993). In this case, the NRG staff realized that under the provisions of the existing Deliberate Misconduct Rule, it was unable to take additional enforcement action against Dr. Orem and was precluded from taking enforcement action against the consultant because the consultant 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 19

combined licenses under 10 CFR Part 52.

The Commission believes that there may be significant safety consequences from the deliberate submission of false 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 falsified 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 falsified 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 inaccurate information, whether that submittal is by or on behalf of an applicant, or by or on behalf of a holder of a license, certificate, permit or approval.

The objective of the rule is 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 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 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 the Commission are to promulgate a modification of the Deliberate Misconduct Rule, as is proposed herein, or do nothing. Given the fact that a 20

case has already occurred where the Commission was precluded 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 Notice of Violation calls for a precise response as to corrective action taken, and an enforcement order, if obeyed, will directly control the involvement 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 additional investigations 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 constitutes the regulatory analysis for this rule.

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 21

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 that they are subject to the Deliberate Misconduct Rule and, therefore, are subject to civil enforcement action if they deliberately cause a licensee, certificate holder, or an applicant for a license or certificate to be in violation of NRC requirements. The final rule does not impose any additional obligations on entities 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 determination with the Office of Information and Regulatory Affairs, Office of Management and Budget.

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Backf it 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 required for this final rule because 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.

10 CFR Part 32 Byprortuct material, Criminal penalties, Nuclear materials, Labeling, Radiation protection, Reporting and recordkeeping requirements.

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10 CFR Part 40 Criminal penalties, Government contracts, Hazardous materials transportation, Nuclear materials, Reporting and recordkeeping requirements, Source material, Uranium.

10 CFR Part 50 Antitrust, Classified information, Criminal penalties, Fire protection, Intergovernmental relations, Nuclear power plants and reactors, Radiation protection, Reactor siting criteria, Reporting and recordkeeping requirements.

10 CFR Part 52 Administrative practice and procedure, Antitrust, Backfitting, Combined license, Early site permit, Emergency planning, Fees, Inspection, Limited work authorization, Nuclear power plants and reactors, Probabilistic risk assessment, Prototype, Reactor siting criteria, Redress of site, Reporting and recordkeeping requirements, Standard design, Standard design certification.

10 CFR Part 60 Criminal penalties, High-level waste, Nuclear power plants and reactors, Nuclear materials, Reporting and recordkeeping requirements, Waste treatment and disposal.

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

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10 CFR Part 70 Criminal penalties, Hazardous materials transportation, Material control and accounting, Nuclear materials, Packaging and containers, Radiation protection, Reporting and recordkeeping requirements, Scientific equipment, Security measures, Special 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, Export, Import, Intergovernmental relations, Nuclear materials, Nuclear power plants and reactors, Reporting and recordkeeping requirements, Scientific equipment.

10 CFR Part 150 Criminal penalties, Hazardous materials transportation, Intergovernmental relations, Nuclear materials, Reporting and recordkeeping requirements, Security measures, Source material, Special nuclear material.

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For the reasons stated in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 552 and 553; the NRC is adopting the following amendments to 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72, 110, and 150.

PART 30--RULES OF GENERAL APPLICABILITY TO DOMESTIC LICENSING OF BYPRODUCT MATERIAL 1. The authority citation for Part 30 continues to read as follows:

AUTHORITY: Secs. 81, 82, 161, 182, 183, 186, 68 Stat. 935, 948, 953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2111, 2112, 2201, 2232, 2233, 2236, 2282); secs. 201, as amended, 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, sec. 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 sec. 187, 68 Stat. 955 (42 U.S.C. 2237).

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

§ 30.1 Scope.

This part prescribes rules applicable to all persons in the United States governing domestic licensing of byproduct material under the Atomic Energy Act of 1954, as amended (68 Stat. 919), and under title II of the Energy Reorganization Act of 1974 (88 26

Stat. 1242), and exemptions from the domestic licensing requirements permitted by Section 81 of the Act. This part also gives notice to all persons who knowingly provide to any licensee, applicant, certificate of registration holder, contractor, or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's, applicant's or certificate of registration holder's activities subject to this part, that they may be individually subject to NRC enforcement action for violation of § 30. 10.

3. Section 30.10 is revised to read as follows:

§ 30.1 o Deliberate misconduct.

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

(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 term, condition, or limitation of any license 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, 27

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 licensee, certificate of registration holder 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, certificate of registration holder, applicant, contractor, or subcontractor.

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

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

AUTHORITY: Secs. 81, 161, 182, 183, 68 Stat. 935, 948, 953, 954, as amended (42 U.S.C. 2111, 2201, 2232, 2233); sec. 201, 88 Stat. 1242, as amended (42 U.S.C.

5841 ).

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5. Section 32.1 (bl is revised to read as follows:

§ 32.1 Purpose and scope.

(b) The provisions and requirements of this part are in addition to, and not in substitution for, other requirements 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 as follows:

AUTHORITY: Secs. 62, 63, 64, 65, 81, 161, 182, 183, 186, 68 Stat. 932, 933, 935, 948, 953, 954, 955, as amended, secs. 11 e(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, 2094, 2095, 2111, 2113, 2114, 2201, 2232, 2233, 2236, 2282);sec. 274, Pub. L.86-373, 73 Stat. 688 (42 U.S.C. 2021 ); secs. 201, as amended, 202, 206, 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 40.31(g) also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Section 40.46 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234). Section 40.71 also issued under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).

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7. Section 40.2, is revised to read as follows:

§ 40.2 Scope.

Except as provided in § § 40.11 to 40.14, inclusive, the regulations in this part apply to all persons in the United States. 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 § 40. 10.

8. Section 40.10 is revised to read as follows:

§ 40. 1 o 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:

( 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 30

information knows to be incomplete or inaccurate in some respect material to the NRC.

(bl 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 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 licensee, applicant, contractor, or subcontractor.

PART 50--DOMESTIC LICENSING OF PRODUCTION AND UTILIZATION FACILITIES

9. The authority citation for Part 50 continues 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 amended (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. 2902, 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. 2131, 2235);

sec. 102, Pub. L.91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.13, 50.54(dd), 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 (42 U.S.C.

31

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 issued under Pub. L.97-415, 96 Stat. 2073 (42 U.S.C. 2239). Section 50. 78 also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Sectio!1s 50.80 - 50.81 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234). Appendix F also issued under sec. 187, 68 Stat. 955 (42 U.S.C 2237).

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

§ 50. 1 Basis. purpose. and procedures applicable.

The regulations 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 II of the Energy Reorganization Act of 1974 (88 Stat. 1242), to provide for the licensing of production and utilization facilities. 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 § 50.5.

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11. Section 50.5 is revised to read as follows:

§ 50,5 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:

( 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, informafr:>n 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 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 licensee, applicant, contractor, or subcontractor.

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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 read as follows:

AUTHORITY: Secs. 103, 104, 161, 182, 183, 186, 189, 68 Stat. 936, 948, 953, 954, 955, 956, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2133, 2201, 2232, 2233, 2236, 2239, 2282); secs. 201, 202, 206, 88 Stat. 1242, 1244, 1246, as amended (42 U.S.C. 5841, 5842, 5846).

13. Section 52.1 is revised to read as follows:

§ 52, 1 Scope.

This part governs the issuance of early site permits, standard design certifications, and combined licenses for nuclear power facilitief licensed under Section 103 or 104b of the Atomic Energy Act of 1954, as amended (68 Stat. 919), and Title II 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, subcontractor, 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 § 52.9.

34

14. Section 52.9 is added to read as follows:

§ 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 consultants and their employees, who knowingly provides to any holder of, or applicant for, an early site permit, 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 detected, a holder of, or applicant for, an early site permit, 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 contractor, 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.

(bl 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 (al( 1 l 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 permit, standard design certification, or combined license, to be in violation of any rule, regulation, or order; or any 35

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 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

0.1 Purpose and Scope

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 36

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

§ 60.11.

17. Section 60.11 is revised to read as follows:

§ 60, 11 Deliberate misconduct.

(al 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:

( 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.

(bl 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.

37

(cl 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 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.

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 5851) and Pub. L. 102-486, sec 2902, 106 Stat. 3123, (42 U.S.C. 5851 ).

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

§ 61. 1 Purpose and Scope.

(c) This part also gives notice to all persons who knowingly provide to any licensee, applicant, contractor, or subcontractor, componerits, equipment, m?1:erials, or other goods or services, that relate to a licensee's or applicant's activities subject to this part, that they 38

may be individually subject to NRC enforcement action for violation of § 61.9b.

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

§ 61.9b 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:

( 1) Engage in deliberate misconduct that causes or would haye 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.

(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 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, 39

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: Secs. 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).

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 70.61 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).

40

22. Section 70.2, is revised to read as follows:

§ 70.2 Scope.

Except as provided in § § 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 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 § 70.10.

23. Section 70.10 is revised to read as follows:

§ 70, 1 o 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:

( 1 I 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 41

~---------

(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.

(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 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.

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); secs. 201, as amended, 202, 206, 88 Stat. 1242, 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.

42

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

§ 7

1.0 Purpose 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, or quality assurance program approval 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, 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 § 71. 11.

26. Section 71.11 is added to read as follows:

§ 71. 11 Deliberate misconduct.

(a) This section applies to any---

( 1) Licensee:

(2) Certificate holder; (3) Quality assurance program 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 identified in paragraphs (a)(1) through (a)(4) of this section; or 43

(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 provides 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 to this part may not:

( 1) Engage in deliberate misconduct that 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, regulation, or order; or any term, condition, or limitation of any license, certificate or approval issued 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 assurance program approval holder's contrac!or 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 paragraph (bl( 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 44

(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 STORAGE OF SPENT NUCLEAR FUEL AND HIGH-LEVEL RADIOACTIVE WASTE

27. The authority citation for Part 72 continues to read as follows:

AUTHORITY: Secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 187, 189, 68 Stat. 929, 930, 932, 933, 934, 935, 948, 953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2232, 2233, 2234, 2236, 2237, 2238, 2282); sec. 274, Pub. L.86-373, 73 Stat. 688, as amended (42 U.S.C. 2021 ); sec. 201, as amended, 202, 206, 88 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.

5851); 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).

Section 72.44(9) also issued under secs. 142(b) and 148(c), (d), Pub. L. 100-203, 101 Stat. 1330-232, 1330-236 (42 U.S.C. 10162(b), 10168(c), (d)). Section 72.46 also 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(9), Pub. L. 100-203, 101 Stat. 1330-235 (42 U.S.C. 10165(9)). Subpart J also issued under secs. 2(2),

2( 15), 2( 19), 117(a), 141 (h), Pub. L.97-425, 96 Stat. 2202, 2203, 2204, 2222, 2224 45

(42 U.S.C. 10101, 10137(a), 10161(h)). Subparts Kand Lare 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, paragraph (fl is revised to read as follows:

§ 72,2 Scope.

(f) This part also gives notice to all persons who knowingly provide to any licensee, certificate holder, applicant for a license or certificate, contractor, or subcontractor, components, 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 subject to NRC enforcement action for violation of § 72.12.

29. Section 72.12 is revised to read as follows:

§ 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, certificate holder, applicant for a license or 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 46

this part, may not:

( 1) Engage in deliberate misconduct that causes or would have caused, if not detected, a licensee, certificate holder or applicant 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 (2) Deliberately submit to the NRC, a licensee, a certificate holder, an 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 knows to be incomplete or inaccurate in some respect material to the NRC.

(bl 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 l 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 or applicant for a license or certificate to be in violation of any rule, regulation, or order; or any term, condition, or limitation, of e

any license or certificate issued by the Commission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, certificate holder, applicant, contractor, or subcontractor.

47

PART 110--EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATERIAL

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, 129, 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, 2112, 2133, 2134, 2139, 2139a, 2141, 2154-2158, 2201, 2231-2233, 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).

Sections 110.1 (b)(2) and 110.1 (b)(3) also issued under Pub. L. 96-92, 93 Stat. 710 (22 U.S.C. 2403). Section 110.11 also issued under sec. 122, 68 Stat. 939 (42 U.S.C.

2152) and secs. 54c and 57d., 88 Stat. 473, 475 (42 U.S.C. 2074). Section 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 U.S.C. 552, 554.

Sections 110.130-110.135 also issued under 5 U.S.C. 553. Sections 110.2 and 110.42 (a)(9) also issued under sec. 903, Pub. L. 102-496 (42 U.S.C. 2151 et seq.).

48

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

§ 11

0.1 Purpose and Scope

(a) The regulations in this part prescribe licensing, enforcement, and rulemaking procedures and criteria, under the Atomic Energy Act, for the export of nuclear equipment and material, as set out in § § 110.8 and 110.9, and the import of nuclear equipment and material, as set out in § 110.9a. 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 § 110. 7b.

32. Section 110. 7b is revised to read as follows:

§ 11 o, 7b Peli berate 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:

( 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 49

(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.

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

(cl For the purposes of paragraph (a)( 1 l 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 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.

PART 150--EXEMPTIONS AND CONTINUED REGULATORY AUTHORITY IN AGREEMENT STATES AND IN OFFSHORE WATERS UNDER SECTION 274

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

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

Sections 150.3, 150.15, 150.15a, 150.31, 150.32 also issued under secs. 11 e(2),

81, 68 Stat. 923, 935, as amended, secs. 83, 84, 92 Stat. 3033, 3039 (42 U.S.C.

2014e(2l, 2111, 2113, 2114). Section 150.14 also issued under sec. 53, 68 Stat. 930, as amended (42 U.S.C. 20731. Section 150.15 also issued under secs. 135, 141, Pub.L.

50 97-425, 96 Stat. 2232, 2241 (42 U.S.C. 10155, 10161). Section 150.17a also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Section 150.30 also issued under sec. 234, 83 Stat. 444 (42 U.S.C. 2282).

34. Section 150.2 is revised to read as follows:

§ 150.2 Scope.

The regulations in this part apply to all States that have entered into agreements with the Commission or the Atomic Energy Commission 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 licensee'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 § § 30.10, 40.10, 70.10 and 71.11.

Dated at Rockville, Maryland, this {s 6ay of January, 1998.

For the Nuclear Regulatory Commission.

C. Hoyle, etary of the Commission.

51

DOCKET NUMBER PROPOSED RULE Pl jo,3..( 4 af.

December 18, 1996

( (,/ F~ 5 I '6 35)

Secretary U.S. Nuclear Regulatory Commission Washington, D.C. 20555-0001 Attn.:

Docketing and Service Branch

Subject:

Comments on Proposed Rule: RIN 3150-AF35 Deliberate Misconduct by Unlicensed Persons JAN - 3 1997

~

sECY-MflC These comments are limited to the provisions of the proposed rule that apply to 10 CFR Part 30 and 32 for the manufacture and distribution of radiography devices, sealed sources and associated equipment that are authorized for use in accordance with 10 CFR Part 34. We support the proposed revision to extend the Deliberate Misconduct rule to six categories of persons, particularly for applicants for, or holders of, certificates ofregistration; and applicants for, or holders of, quality assurance program approvals. We recommend that the rule be revised to specifically apply to the persons who maintain the equipment malfunction records that are required by the Quality Control (QC) and Quality Assurance (QA) programs which are required under 10 CFR Part 32 for the manufacture and distribution of radiography equipment.

Title 10 CFR Part 32 requires applicants to manufacture and distribute products in accordance with QC standards approved by the U.S. Nuclear Regulatory Commission. NRC Regulatory Guide 6.9 "Establishing Quality Assurance Programs for the Manufacture and Distribution of Sealed Sources and Devices Containing Byproduct Material" describes the minimum acceptable QC and QA program requirements. Section 11 "Deviations and Customer Complaints" of Regulatory Guide 6.9 describes the requirement for the certificate holder to maintain and evaluate equipment malfunction and customer complaint records, and to take prompt corrective action when applicable. Those records are not part of the QA program itself~ and are therefore not submitted to the NRC as part of the device registration application. Nevertheless, the accuracy and integrity of these records are essential for the QC/QA program to be effective. The current proposed revision to the Deliberate Misconduct rule appears to apply only to information that is submitted to the NRC as part of a registration certificate application. It should be extended to apply to QC/QA records that must be maintained by the certificate holder after the equipment registration has been issued.

This recommendation is important to public health and safety because improved equipment design is one of the efforts needed to reduce the number of radiography equipment malfunctions.

The number of malfunctions has increased in recent years due to increased mechanical JAN O 7 199'1

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U.S. Nuclear Regulatory Commission Page 2 of2 complexity of radiography devices, particularly the lock systems. The QC/QA requirements impose a responsibility on the manufacturer and distributor to improve the safety design of radiography equipment as much as reasonably achievable. The corrective action provision of the QC/QA requirements for equipment design is the regulatory equivalent of the ALARA rule. It requires safety design improvements beyond the minimum requirements specified in 10 CFR 34.20 and ANSI Standard N432-1980. Accordingly, the Deliberate Misconduct rule should apply to persons who maintain equipment malfunction data for a certificate holder just as it applies to persons who maintain radiation dose data for a licensee to meet ALARA.

Deliberately falsified data that mask a significant defect could be a public health and safety threat if it causes corrective action of faulty equipment design to be delayed of omitted. Persons who deliberately omit or otherwise misrepresent equipment malfunction data should be subject to the Deliberate Misconduct rule. Proper maintenance of malfunction records is also relevant for the certificate holder to adequately address the evaluation and notification requirements listed in 10 CFR 21.21. We recognize that it may not be practicable for the NRC to inspect each vendor on a routine basis to verify compliance with the recording keeping and corrective action requirements of their QC/QA program, particularly manufacturers of only associated equipment. Therefore, we recommend that the NRC verify compliance as part of acute overexposure and equipment malfunction incident investigations.

We hope these comments are useful to the NRC. I am available to meet with the NRC to discuss these recommendations in further detail if needed.

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R. D. (Donny) Dicha;;/

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December 18, 1996 The Secretary of the Commission U.S. Nuclear Regulatory Commission Washington, D. C. 20555 Attn: Docketing and Service Branch

SUBJECT:

Commonwealth Edison (ComEd) Comments on Proposed Rule Revisions to Deliberate Misconduct by Unlicensed Persons (FR 51835, Vol. 61, No. 194)

The purpose of this memo is to provide comments to the NRC Staff on the proposed revision to its Deliberate Misconduct Rule. The comment period for this revision of the rule expires December! 8, 1996. Our comments are provided below:

As noted in Federal Register Notice 51835, Vol. 61, No. 194, the NRC is amending its regulations to extend the Deliberate Misconduct Rule to six categories of persons: 1) applicants for NRC licenses; 2) applicants for, or holders of, certifications of compliance;

3) applications for, or holders of, early site permits, standard design certification, or combined licenses for nuclear power plants; 4) applications for, or holders of, certifications of registration; 5) applicants for, or holders of, quality assurance program approvals; 6) and the employees, contractors, subcontractors and consultants of the first five categories of persons, so that they may be subject to enforcement action for deliberate misconduct.

ComEd has comments with regards to two specific areas, preliminary or draft information that is provided to the staff and how potentially erroneous information in a staff SER may be handled under this proposed rule.

We have concerns regarding the proposed revision to the rule as it does not address preliminary or "for information only" information that may be sent to the NRC staff.

Situations arise where licensees provide such information to the staff to support teleconferences or meetings. Preliminary information sometimes changes over time, and it is ComEd's belief that such situations should not be misconstrued and conclusions reached that there was "deliberate misconduct" in such cases. To clarify this matter, ComEd believes that this type of situation should be addressed in the final rule. In addition, we recommend that a more clear, concise definition of deliberate misconduct be included in the proposed rule or policy.

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U. S. Nuclear Regulatory Commission December 18, 1996 The second matter pertains to how potentially erroneous information in a staff Safety Evaluation Report (SER) may be handled under this proposed rule. In the development of a staff SER, there is a potential for the staff to reach conclusions that may not be consistent with the information provided in a licensees submittal. In the broadest sense, the staff may conclude that those types of situations could constitute "willful misconduct" on the part of the licensee.

Commonwealth Edison has high expectations of its employees, and how they interact with the NRC. Therefore, we would expect our employees to behave in a manner that "willful misconduct" is not an issue, and should it occur, we as an organization will not tolerate it. This, however, does not obviate the need for NRC staff to promulgate rules or policies in this area that are crisp and clear.

Please feel free to contact this office if you have any questions pertaining to this review.

Sincerely,

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OOC~\\[TlD NUCLEAR ENERGY INSTITUTE December 18, 1996 Mr. John C. Hoyle Secretary U.S. Nuclear Regulatory Commission Mail Stop 0-16 G 15 One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738

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SUBJECT:

Proposed Rule, Deliberate Misconduct By Unlicensed Personnel (61 Fed. Reg. 51,835, October 4, 1996)

Dear Mr. Hoyle:

On behalf of the nuclear industry, the Nuclear Energy Institute (NEI) 1 hereby submits the following comments on the NRC's proposed rule, Deliberate Misconduct By Unlicensed Personnel (61 Fed. Reg. 51,835; October 4, 1996).

In 1991, the NRC promulgated the Deliberate Misconduct Rule (56 Fed. Reg.

40,664, August 15, 1991; see 10 CFR 30.10, 40.10, 50.5, 60.11, 61.9b, 70.10, 72.12, and 110. 7b) to notify licensees, licensee contractors, licensee subcontractors or any of their employees that they may be subject to enforcement action for certain kinds of deliberate misconduct. Now, in the proposed rule, the NRC seeks to enlarge the application of the Deliberate Misconduct Rule to six additional categories of persons, including certain categories of applicants and their employees, contractors, subcontractors, and consultants.

The industry recognizes the NRC's need to take steps to avoid receiving and, in turn, relying on incorrect or inaccurate information. Without question, such misinformation potentially could have a very serious effect on the public health and safety. Thus, it is reasonable for the NRC to seek to establish penalties to deter individuals and entities from engaging in that and other forms of deliberate 1 NEI is the organization responsible for establishing unified nuclear industry policy on matters affecting the nuclear energy industry, including regulatory aspects of generic operational and technical issues. NEI' s members include all utilities licensed to operate commercial nuclear power plants in the United States, nuclear plant designers, major architect/engineering firms, fuel fabrication facilities, materials licensees, and other organizations and individuals involved in the nuclear energy industry.

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Mr. John C. Hoyle December 18, 1996 Page 2 misconduct. However, and as is discussed at greater length below, the NRC has exceeded its statutory authority under the Atomic Energy Act, as amended, in expanding the Deliberate Misconduct Rule as now proposed.

Our comments2 on the Deliberate Misconduct Rule promulgated in 1991 questioned the NRC's reliance on the broad statutory authority provided in sections 161 and 234 of the Atomic Energy Act for jurisdiction over persons who are not licensees.

Despite the fact that the 1991 Deliberate Misconduct Rule was promulgated and currently stands, we continue to believe that Sections 161 and 234 of the Atomic Energy Act, as amended, do not endow the NRC with the extremely broad jurisdiction the Agency claims. Authority over non-licensee persons was not established by Congress other than in the limited circumstances carved out in the Act as exceptions. While section 16 li(3) permits the NRC to "prescribe such regulations or order[s] as it may deem necessary to govern any activity authorized pursuant to [the] Act" and "in order to protect health and to minimize danger to life or property... " (42 U.S.C. 2201(i)(3)(1982)), neither it, nor any other of the subsections of section 161 contain the operative phrase "any person." As such, the NRC's claim of jurisdiction over non-licensees appears to be unfounded.

Absent statutory authority, no federal agency, including the NRC, may establish its own enforcement authority. Unless and until Congress modifies the Atomic Energy Act to provide the NRC with the in personam jurisdiction it currently lacks, the NRC may refer such wrongdoers to the Department of Justice under 18 U.S.C.

1001, the general criminal statute applicable to the federal government and its agencies. Until Congress expands the NRC's authority to reach non-licensees under its organic statute, 18 U.S.C. 1001 provides an adequate deterrent and remedy.

Also, as currently holds for the Deliberate Misconduct Rule (10 CFR 50.5(a)(2)), 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 NRC to take enforcement action whether or not a violation of NRC regulations has occurred or would have occurred but for detection. At a minimum, the standard should be sufficiently clear to fairly inform the public of the elements of the prohibited action. We believe that if challenged, the NRC's standard may fail under a claim of vagueness.

In sum, NEI believes that the proposed rule expanding the Deliberate Misconduct Rule should be rescinded because of a lack of jurisdiction and vagueness. If the 2 The comments were filed by letter dated June 18, 1990, on behalf of the nuclear industry by Nuclear Management and Resources Council, one ofNEl's predecessor organizations.

Mr. John C. Hoyle December 18, 1996 Page 3 NRC chooses not to rescind the proposed rule, it should be modified in a manner consistent with these comments and again published for comment in the Federal Register.

Please do not hesitate to call Ellen Ginsberg, (202) 739-8140, NEI's Assistant General Counsel, or me if you have any questions about our comments or would like to discuss them further.

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DOCKET NUMBER PROPOSED RULE Pff J 'ZJ*, 3 2 d ~ -

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Toledo Coalition for Safe Energy 2355 Hempstead Road Toledo, Ohio 43606

( 419) 535-6920 DOCKETED US 1~C

.96 NO'/ -8 P 3 :55 November 4, l<.fflq.*1cE. OF s~r qE fARY DOCK. I.G E. VIC Secretary U.S. Nuclear Regulatory Commission Washington, \\c). C. 20555 ATTENTION:

Secretary:

BRAN~H Docketing and Service Branch This correspondence is in response to a notice in the Federal Register 10-4-96 regarding Deliberate Misconduct by Unlicensed Persons. While I may agree with the proposed change to the Code of Federal Regulations regarding who is bound by the Misconduct Rule, I certainly disagree with your thinking on arriving at this change.

he 10CFR 72.12 clearly states:

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 of any licensee who knowingly provides to any licensee, contractor or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's activities subject to this part may not...... etc. etc.

I do not appreciate the interpretation, as the Code currently reads, that a holder of a Certificate of Compliance and that holder's contractors and subcontractors are not bound by the regulation as it reads now. The licensee of a nuclear power plant contracts with the holder of the CoC for the purpose of supplying casks. As stated above " any contractor, subcontractor or any employee of a contractor or subcontractor" is bound by CFR. Why then do you make the distinction that there is a difference.

For an example, Toledo Edison contracted with Vectra for the purpose of supplying the Nuhoms 24P. Vectra subcontracts parts of the work out. Where is the distinction that Vectra is not under contract with a licensee? Where is the distinction that a Q.A program by a subcontractor is not bound by CFR? Certainly, the intention of CFR applies to contractors and subcontractors just as it states.

I would appreciate a clarification.

cc: Senator John Glenn Congresswoman Marcy Kaptur NRC Chairperson Shirley Jackson cUµ.~

11 ~

Charlene nston 3417 Darr on Road Toledo, 0 io 43606

~cknowledged b JAN o 7 1997_

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,.S. NUCLEAR Rc.GuLA1-0AY COMMtSSIO~

DOCKETING & SERVICE SECTION OFFICE OF THE SECRETARY OF THE COMMISSION

DOCKET NUMB~" JOI*

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USNRC TELEPHONE: (703) 359-9355 TELEFAX: (703) 359-0842 Secretary U.S. Nuclear Regulatory Commission Washington, D.C. 20555-001 ATTN: Docketing and Service Branch

Dear Sir:

• 96 OCT 17 P 4 :56 OFFICf OF SEt'R fARY OOCKE l -S & :~ ICE October 11, 19968nA 'CH Please refer to Proposed Rule dated September 30, 1996 regarding "Deliberate Misconduct by Unlicensed Persons".

I propose that the aforementioned rule be extended to persons that deliberately submit information that the person submitting the information knows to be incomplete or inaccurate in some respect material to NRC under the provisions of 10CFR21 (Reporting of Defects and Non Compliance). It is highly discriminatory to subject persons that submit knowingly incomplete or erroneous information to licensees to the penalties provided by the proposed rule -- and not those that submit knowingly incomplete or erroneous information to NRC regarding defects or non-compliance under 1 0CFR21. The latter alSQ has a material public safety significance inasmuch as it misdirects valuable resources of both the NRC and its licensees, without justification, to addressing the allegation of defects or non-compliance when such resources would otherwise be available to ensure safe operations and to address real safety issues. This extension of the proposed rule should not deter persons that identify real safety problems from reporting them to the NRC, that were either founded in fact or represented the honest belief that they existed, but would serve as a deterrent to deliberate and willful misrepresentations -- made as a result of employee or contractor disgruntlement, labor disputes, and the like.

Your careful consideration of these comments is respectfully requested.

Very truly yours, -

~

E. R. Johnson 0 7 1997

~cknowledged by card---~... " Ill.,..._._.

formerly E. R. JOHNSON ~

IATES, INC.

J.,,S. NUCLEAR Fll:uUl.A 1 ORY COMMISSIOl't DOCKETING & SERVICE SECTION OFFICE OF THE SECRETARY OF THE COMMISSION o.,::umant Statistics Postmark Data 10 / 1s /q I, Coples Rec:i*.,d. __..L---,------

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• 95 OCT - 1 p 4 :20 NUCLEAR REGULATORY COMMISSION OFFICE o; ::r:.cR:,. RY 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72, 110, and fWoK Tltl:..i t~ SthV/CE Bt? ANCH RIN: 3150-~F35 Deliberate Misconduct by Unlicensed Persons AGENCY:

Nuclear Regulatory Commission.

ACTION:

Proposed rule.

SUMMARY

The Nuclear Regulatory Commission (NRC) is proposing to revise 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, 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 consultants of the first 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 and 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 Co1m1ission's requirements.

}.2--) )f-/ <fl;,

DATES:

The comment period expires [insert d~te 75 days from publication].

Comments received after this date will be considered if it is practical to do so, but the Commission is able to assure consideration only for colMlents received on or/ before this date.

ADDRESSES:

Comments may be sent to:

Sec1etary, U.S. Nuclear Regulatory Co11111ission, Washington, DC 20555-0001.

Attn:

Docketing and Service Branch.

Hand deliver comments to 11555 Rockville Pike, Maryland, between 7:45 am and 4:15 pm on Federal workdays.

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, ajd@nrc.gov.

SUPPLEMENTARY INFORMATION:

Background

On August 15, 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, and 110.7b, which 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, of any licensee.

In addition, 10 CFR 150.2 makes the rule applicable to persons conducting activities under reciprocity in areas of NRC jurisdiction, {see 10 CFR 150.20).

The Deliberate Misconduct Rule placed 2

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 material to the NRC.

The rule also re1ised the NRC's procedures for issuing orders to include persons not licensed by the Commission, but who are otherwise subject to the Commission's statutory authority.

Currently, the Deliberate Misconduct Rule does not apply to:

(1) Applicants for NRC licenses; (2)

Applicants for, or holders of, certificates of compliance issued under 10 CFR Parts 71 and 72, including those for dry cask storage; (3) Applicants for, or holders of, early site permits, standard design certifications, or combined 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 under 10 CFR Part 71; and (6) The employees, contractors, subcontractors, and consultants of the first five categories of persons.

To ensure that these persons are subject to enforcement action for wrongdoing under the Deliberate Misconduct Rule, the NRC is proposing to extend the rule to them.

The Commission's proposed rule would also add the Deliberate Misconduct Rule to 10 CFR Parts 52 and 71 where it currently does not appear.

3

r The Commission 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 Co11111ission does not believe that it is necessary to add the Deliberate Misconduct Rule to 10 CFR Part 55 because applicants for, anc holders of, reactor operators licenses are already subject to this rule 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.

Discussion It is important that all information 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 "[a] license may be revoked for any material false statement in the application or any statement of fact required [by statute or regulation].... " The Commission has promulgated rules concerning completeness and accuracy of 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.l0(a),

61.9a(a}, 70.9(a), 71.7a, 72.ll(a), 76.9(a) and 110.7a(a)}.

Similarly, paragraph (b) of each of these sections, which deals with notification to the Commission of significant safety information, refers to applicants as well as licensees.

Violation of these provisions can result in denial of the license 4

application, civil enforcement action against a licensee, or, if appropriate, referral to the Department of Justice for consideration for criminal 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 ~nows to be incomplete or inaccurate.

However, when the Deliberate 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.

Incomplete or inaccurate information has potential safety significance, whether submitted before or after a license, certificate, permit, or approval has been issued.

The Commission has clearly emphasized the importance of applications containing accurate information; e.g., "[The Commission] cannot overstate the importance of a licensee's or an applicant's duty to provide the Commission with accurate information." Randall C. Orem. D.O., CLI-93-14, 37 NRC 423 (1993).

The Orem case involved a consultant to an applicant for a license who provided inaccurate information that was included in the license application and the Commission found that information as to the status of the facility was material to the licensing decision.

IQ. at 428.

The Commission believes that there may be significant safety consequences from the deliberate submission of false 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 cask that is certified 5

by the NRC on the basis of falsified 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 falsified data that mask a significant defect could also be a public health and safety threat.

Under the present Deliberate Misconduct Rule, a certificate holder who obtainea a certificate by deliberate ~ubmittal of false 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 deter the deliberate submittal of materially false or inaccurate information by those entities not 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, whether such submittal is by or on behalf of an applicant, or by or on behalf of a holder of a license, certificate, permit, or approval.

The Commission proposes to modify the Deliberate Misconduct Rule each place it appears in 10 CFR Chapter I to make the rule apply to applicants for NRC licenses; to applicants for, and holders Jf, 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, certificates of registration issued under Parts 30 and 32; and to applicants for, and holders of, quality assurance program approvals issued under Part 71; and to the employees, contractors, subcontractors and consultants of all the above categories of persons.

This would include, for example, a consultant engaged by an applicant to prepare a license application for such activities 6

as radiography, well logging, irradiation, and teletherapy.

It would also apply to a consultant preparing an application for a certificate for a spent fuel cask, or individuals conducting performance tests to support such an application.

The proposed revisions to the Deliberate Misconduct Rule would appear in 10 CFR 30.10, 40.10, 50.5, 60.11, 61.9b, 70.10, 72.12, and 110.7b.

Section 71.11 would be added to incorporate the rule in Part 71 and § 52.10 would be added to incorporate the rule in 10 CFR Part 52.

In addition, 10 CFR 150.2 and 10 CFR 32.l(b) would be revised to incorporate the proposed changes.

The scope provisions found in 10 CFR 30.1, 40.2, 50.1, 52.1, 60.1, 61.l(c), 70.2, 71.0, 72.2, and 110.l(a) would also be modified to reflect these revisions to the rule.

The Commission would make a minor language change by altering the phrase "but for detection" to "if not detected" where the phrase appears in each rule, but intends no substantive change by this revision.

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

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; applicants for, and holders of, certificates of registration issued under 10 CFR Parts 30 and 32; and applicants for, and holders of, quality assurance program approvals issued under 10 CFR Part 71; and to the employees, contractors, subcontractors and consultants of all the above categories of persons, implements the 7

Commission's authority under the AEA to issue regulations and orders to any person (defined in section lls 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 16li of the AEA pr0vides 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 e

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 (as amended by section 3116, Title III of the Omnibus Appropriations Act of 1996, April 28,1996) reads as foll )Ws:

Any person who (1) violates any licensing or certification prov1s1on of sections 53, 57, 62, 63, 81, 82, 101, 103, 104, 107, 109, or 1701 of 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 civil penalty, to be imposed by the Commission, of not to exceed $100,000 for each such violation.

The licensing provisions listed in section 234a generally prohibit the possession, use, receipt, or transfer of nuclear materials or facilities unless authorized by and in accordance with a license.

8

The proposed changes are made under the authority of sections 161b and and the above-identified licensing and certification provisions in section 234.

The changes apply to any person who engages in deliberate misconduct, or who deliberately submits materially incomplete or inaccurate information, as provided in the rule.

By imposing a direct prohibition on unlicensed persons, the Conwnission may be able to exercise its section 234 authority to impose civil penalties on unlicensed persons who deliberately cause a licensee, applicant, or permit or certificate holder to be in violation of requirements because they are persons who violate the licensing provisions enumerated in section 234.

In cases when the Commission issues an order (other than an order imposing a civil penalty) to a person based on deliberate misconduct that causes a licensee, applicant, or permit or certificate holder to be in violation of a Commission requirement, the order would be issued in part pursuant to a regulation (e.g., § 30.10) that was promulgated under a licensing provision of the AEA.

A civil penalty could be available for violations of such an order.

In addition, criminal sanctions under section 223 of the AEA 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 Commission orders.

Electronic Access Conwnents may be submitted electronically, in either ASCII text or WordPerfect format (version 5.1 or later}, by calling the NRC Electronic Bulletin Board (BBS) on FedWorld.

The bulletin board may be accessed using a personal computer, a modem, and one of the commonly available communications 9

~-----------------------

software packages, or directly via Internet.

Background documents on the rulemaking are also available, as practical, for downloading and viewing on the bulletin board.

If using a personal computer and modem, the NRC rulemaking subsystem on FedWorld can be accessed directly by dialing the toll-free number (800) 303-9672.

Co11111unication software parameters s~ould be set as follows:

parity to none, data bits to 8, and stop bits to 1 (N,8,1).

Using ANSI or VT-100 terminal emulation, the NRC rulemaking subsystem can then be accessed by selecting the "Rules Menu" option from the "NRC Main Menu."

Users will find the "FedWorld Online User's Guides" particularly helpful.

Many NRC subsystems and data bases also have a "Help/Information Center" option that is tailored to the particular subsystem.

The NRC subsystem on FedWorld can also be accessed by a directly dialed phone number for the main FedWorld BBS, (703) 321-3339, or by using Telnet via Internet:

fedworld.gov.

If using (703) 321-3339 to contact FedWorld, the NRC subsystem will be accessed from the main FedWorld menu by selecting the "Regulatory, Government Administration and State Systems," then selecting "Regulatory Information Mall."

At that pcint, a menu will be displayed that has an option "U.S. Nuclear Regulatory Commission" that will take you to the NRC Online main menu.

The NRC Online area also can be accessed directly by typing "/go nrc" at a FedWorld command line.

If you access NRC from FedWorld's main menu, you may return to FedWorld by selecting the "Return to FedWorld" option from the NRC Online Main Menu.

However, if you access NRC at FedWorld by using NRC's toll-free number, you will have full access to all NRC systems, but you will not have access to the main FedWorld system.

If you contact FedWorld using Telnet, you will see the NRC area and menus, including the Rules Menu.

Although you will be able to download documents and leave messages, you will not be able to write comments or upload files (comments).

If you contact FedWorld using FTP, all files can be accessed and downloaded but uploads are not allowed; all you will see is a list of files without descriptions (normal Gopher look).

An index file listing all files within a subdirectory, with descriptions, is available.

There is a IS-minute time limit for FTP access.

Although FedWorld also can be accessed through the World Wide Web, like FTP, that mode only provides access for downloading files and does not display the NRC Rules Menu.

For more information on NRC bulletin boards call Mr. Arthur Davis, Systems Integration and Development Branch, NRC, Washington, DC 20555-0001, telephone (301) 415-5780; e-mail AXD3@nrc.gov.

Certain documents related to this rulemaking, including comments received, may be examined at the NRC Public Document Room, 2120 L Street NW.

(Lower Level}, Washington, DC.

These same documents may also be viewed and downloaded electronically via the Electronic Bulletin Board established by NRC for this rulemaking as indicated in the Supplementary Information section.

Compatibility of Agreement State Regulations This rule is designated a Division-3 matter of compatibility with respect to Agreement State regulations because it deals with enforcement actions such as the issuance of orders and civil penalties to unlicensed persons for deliberate misconduct.

In addition to license applicants, these 11

changes expand applicability of the rule to include persons such as certificate holders and quality assurance program approval holders.

Such actions are addressed individually by States through each State's administrative code.

Division-3 regulations are appropriate for Agreement States to adopt, but do not require any degree of uniformity between the NRC and Agreement State rules.

Agreement States are not required to adopt the regulatory approach identified in Division-3 regulations.

Environmental Impact: Categorical Exclusion The NRC has determined that this proposed rule relates to enforcement matters and, therefore, falls within the scope of 10 CFR 51.lO(d).

Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this proposed rule.

Paperwork Reduction Act Statement This proposed 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.).

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, 3150-0036, and 3150-0032.

12

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 0MB control number.

Regulatory Analysis The NRC 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 license or certificate to be in violation of the Commission's requirements.

On August 15, 1991 (56 FR 40664) the NRC promulgated the Deliberate Misconduct Rule which put licensed and unlicensed persons on notice that they may be subject to enforcement action for deliberate misconduct that causes or, if not detected, would cause a licensee 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 10 CFR 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 10 CFR Part 52; 13

(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 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 was false and that the application had been prepared by a consultant who had provided the false information.

See Randall C. Orem. D.0.,

CLl-93-14, 37 NRC 423 (1993).

In this case, the NRC staff realized that under the provisions of the existing Deliberate Misconduct Rule, it was unable to take additional enforcement action against Dr. Orem and was precluded from taking enforcement action against the consultant because the consultant was working for an applicant rather than for a licensee.

Subsequently, the Corm1ission realized that other categories of persons within NRC jurisdiction had not been explicitly included within the De~iberate 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 Corm1ission believes that there may be significant safety consequences from the deliberate submission of false 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 cask that is certified 14

by the NRC on the basis of falsified 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 falsified data that mask a significant defect could also be a public health and safety threat.

The potential for injury is serious.

The NRC knows of no reason why the Deliberate Misconduct Rule should not ypply to persons who deliberately submit materially incomplete or inaccurate information, whether that submittal is by or on behalf of an applicant, or by or on behalf of a holder of a license, certificate, permit, or approval.

The objective of the rule is 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 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 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 NRC's available alternatives are to promulgate a modification of the Deliberate Misconduct Rule, as is proposed herein, or do nothing.

Because a case has already occurred where the NRC was precluded from taking appropriate enforcement action against a consultant to an applicant and there was potential harm to the public, the alternative of doing nothing was rejected.

The benefits of taking enforcement action are similar to those of taking 15

action against licensed entities in that a civil penalty and attendant adverse publicity encourage future compliance.

The Notice of Violation calls for a precise response regarding the corrective action taken.

An enforcement order, if obeyed, will directly control the involvement of an individual in a licensed activity.

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

The NRC does not anticipate that additional investigations 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 proposed amendments to the Deliberate Misconduct Rule constitute the preferred course of action.

The cost involved in its promulgation and application is necessary and appropriate.

The foregoing discussion constitutes the regulatory analysis for this rule.

Regulatory Flexibility Certification In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C.

605(b}, the Commission certifies that this proposed rule, if adopted, will not have a significant economic impact on a substantial number of small entities.

The proposed 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 16

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 that they are subject to the Deliberate Misconduct Rule and, therefore, are subject to civil enforcement action if they deliberately cause a licensee, certificate holder, or an applicant for a license or certificate to be in violation of NRC requirements.

The proposed rule, by itself, would not impose any additional obligations on entities that may fall within the definition of "small entities~ as set forth in Section 601(3) 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).

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

17

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

10 CFR Part 32 Byproduct material, Criminal penalties, Labeling, Nuclear materials, Radiation protection, Reporting and recordkeeping requirements.

10 CFR Part 40 Criminal penalties, Government contracts, Hazardous materials transportation, Nuclear materials, Reporting and recordkeeping requirements, Source material, Uranium.

10 CFR Part 50 Antitrust, Classified information, Criminal penalties, Fire protection, Intergovernmental relations, Nuclear power plants and reactors, Radiation protection, Reactor siting criteria, Reporting and recordkeeping requirements.

10 CFR Part 52 Administrative practice and procedure, Antitrust, Backfitting, Combined license, Early site permit, Emergency planning, Fees, Inspection, Limited work authorization, Nuclear power plants and reactors, Probabilistic risk 18

assessment, Prototype, Reactor siting criteria, Redress of site, Reporting and recordkeeping requirements, Standard design, Standard design certification.

10 CFR Part 60 Criminal penalties, High-level waste, Nuclear power plants and reactors, Nuclear materials, Reporting and recorakeeping requirements, Waste treatment and disposal.

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 accounting, Nuclear materials, Packaging and containers, Radiation protection, Reporting and recordkeeping requirements, Scientific equipment, Security measures, Special 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.

19

10 CFR Part 110 Administrative practice and procedure, Classified information, Criminal penalties, Export, Import, Intergovernmental relations, Nuclear materials, Nuclear power plants and reactors, Reporting and recordkeeping requirements, Scientific equipment.

10 CFR Part 150 Criminal penalties, Hazardous materials transportation, Intergovernmental relations, Nuclear materials, Reporting and recordkeeping requirements, Security measures, Source material, Special nuclear material.

For the reasons stated in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 553; the NRC is proposing to adopt the following amendments to 10 CFR Parts 30, 32, 40, 50, 52, 60, 61, 70, 71, 72, 110, and 150.

PART 30--RULES OF GENERAL APPLICABILITY TO DOMESTIC LICENSING OF BYPRODUCT MATERIAL

1.

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

AUTHORITY: Secs. 81, 82, 161, 182, 183, 186, 68 Stat. 935, 948, 953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended {42 U.S.C. 2111, 2112, 2201, 2232, 2233, 2236, 2282}; secs. 201, as amended, 202, 206, 88 Stat.

1242, as amended, 1244, 1246 {42 U.S.C. 5841, 5842, 5846}.

20

Section 30.7 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 30.34(b) also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234).

Section 30.61 also issued under sec. 187, 68 Stat. 955 (42 u.s.c. 2237).

2.

Section 30.1 is revised to read as follows:

§ 30.l Scope.

This part prescribes rules applicable to all persons in the United States governing domestic licensing of byproduct material under the Atomic Energy Act of 1954, as amended (68 Stat. 919), and under title II of the Energy Reorganization Act of 1974 (88 Stat. 1242), and exemptions from the domestic licensing requirements permitted by section 81 of the Act.

This part also gives notice to all persons who knowingly provide to any licensee, applicant, certificate of registration holder, contractor, or subcontractor, components, equipment, materials, or other goods or services, that relate to a licensee's, applicant's or certificate of registration holder's activities subject to this part, that they may be individually subject to NRC enforcement action for violation of§ 30.10.

3.

Section 30.10 is revised to read as follows:

§ 30.10 Deliberate misconduct.

(a) Any licensee, certificate of registration holder, applicant for a license or certificate of registration, employee of a licensee, certificate of 21

registration holder 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 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:

(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 term, condition, or limitation of any license 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 information knows to be incomplete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(l) 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)(l) of this section, deliberate misconduct by a person means an intentional act or omission that the person knows:

(1) Would cause a licensee, certificate of registration holder 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 22

(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 TRANSFER CERTAIN ITEMS CONTAINING BYPRODUCT MATERIAL

4.

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

AUTHORITY:

Secs. 81, 161, 182, 183, 68 Stat. 935, 948, 953, 954, as amended (42 U.S.C. 2111, 2201, 2232, 2233); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 5841).

5.

Section 32.l(b) is revised to read as follows:

§ 32.1 Purpose and scope.

{b) The provisions and requirements of this part are in addition to, and not in substitution for, other requireme~ts 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 as follows:

AUTHORITY: Secs. 62, 63, 64, 65, 81, 161, 182, 183, 186, 68 Stat. 932, 933, 935, 948, 953, 954, 955, as amended, secs. lle(2), 83, 84, Pub. L. 95-23

604, 92 Stat. 3033, as amended, 3039, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2014{e)(2), 2092, 2093, 2094, 2095, 2111, 2113, 2114, 2201, 2232, 2233, 2236, 2282); sec. 274, Pub. L.86-373, 73 Stat. 688 (42 U.S.C. 2021); secs. 201, as amended, 202, 206, 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 40.3l(g) also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152).

Section 40.46 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C.

2234).

Section 40.71 also issued under sec. 187, 68 Stat. 955 (42 U.S.C.

2237).

7.

Section 40.2 is revised to read as follows:

§ 40.2 Scope.

Except as provided in §§ 40.11 to 40.14, inclusive, the regulations in this part apply to all persons in the United States. 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§ 40.10.

24

8.

Section 40. 10 is revised to read as follows:

§ 40.10 Deliberate misconduct.

(a) Any licensee, applicant for a license, employee of a licensee or applicant; or any contractor (includin~ 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:

(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 Convnission; 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)(l) 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)(l) of this section, deliberate misconduct by a person means an intentional act or omission that the person knows:

25

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

PART 5O--DOHfSTIC LICENSING OF PRODUCTION AND UTILIZATION FACILITIES

9.

The authority citation for Part 50 continues 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. 1244, as amended (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. 2902, 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. 2131, 2235); sec. 102, Pub. L.91-190, 83 Stat. 853 (42 U.S.C.

4332).

Sections 50.13, 50.54(dd), 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 (42 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 issued under Pub. L.97-415, 96 Stat. 2073 (42 U.S.C. 2239).

Section 50.78 26

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

Sections 50.80 -

50.81 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234).

Appendix Falso issued under sec. 187, 68 Stat. 955 (42 U.S.C 2237).

10.

Section SO.I is revised to read as follows:

§ 50.1 Basjs, purpose. and procedures applicable.

The regulations in this part are promulgated by the Nuclear Regulatory Co11111ission pursuant to the Atomic Energy Act of 1954, as amended (68 Stat.

919), and Title II of the Energy Reorganization Act of 1974 (88 Stat. 1242),

to provide for the licensing of production and utilization facilities. 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§ 50.5.

11.

Section 50.5 is revised to read as follows:

§ 50.5 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 27

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 Cormiission; 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 incomolete or inaccurate in some respect material to the NRC.

(b) A person who violates paragraph (a)(l) 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){l) 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 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.

28

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

12.

The authority citation for Part 52 continues to read as follows:

AUTHORITY:

Secs. 103, 104, 161, 182, 183, 186, 189, 68 Stat. 936, 948, 953, 954, 955, 956, as amended, sec. 234, 83 Stat. 1244, as amended (42 U.S.C.

2133, 2201, 2232, 2233, 2236, 2239, 2282); secs. 201, 202, 206, 88 Stat. 1242, 1244, 1246, as amended (42 U.S.C. 5841, 5842, 5846).

13.

Section 52.1 is revised to read as follows:

§ 52.1 Scope.

This part governs the issuance of early site permits, standard design certifications, and combined licenses for nuclear power facilities licensed under section 103 or 104b of the Atomic Energy Act of 1954, as amended (68 Stat. 919), and Title II 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 ear~y site permit, standard design certification, or combined license, or to a contractor, subcontractor, 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 § 52.10.

29

14.

Section 52.9 is added following § 52.8 and reads as follows:

§ 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~tants and their employees, who knowingly provides to any holder of, or applicant for, an early site permit, 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 detected, a holder of, or applicant for, an early site permit, 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 hvlder of, or applicant for, an early site permit, standard design certification, or combined license, or a contractor, 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)(l) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR part 2, subpart B.

30

(c) For the purposes of paragraph (a)(l) 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 permit, standard design certification, or combined license, to be in violation of any rule, regulation, or order; or any term, ~ondition, or limitation, of any license issued by the Co11111ission; or (2) Constitutes a violation of a requirement, procedure, instruction,

&&contract, 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--0ISPOSAL 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 amenaed (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. 22139, 2228, as amended (42 U.S.C.

10134, 10141) and Pub. L. 102-486, sec. 2902, 106 Stat. 3123 (42 U.S.C. 5851).

31

16.

Section 60.1 is revised to read as follows:

§ 60.1 Purpose and scope.

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 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 § 60.11.

17.

Section 60.11 is revised to read as follows:

§ 60.11 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:

(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, 32

regulation, or order; or any term, condition, or limitation of any license issued by the Co11111ission; 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)(l)* 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)(l) 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 of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Convnission; or (2) Constitutes a violation of a requirement, procedure, instruction, contract, purchase order, or policy of a licensee, applicant, contractor, or subcontractor.

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.

33

~----- ------------- -

5842, 5846); secs. 10 and 14, Pub. L.95-601, 92 Stat. 2951 (42 U.S.C. 2021a and 5851) and Pub. L. 102-486, sec 2902, 106 Stat. 3123, (42 U.S.C. 5851).

19.

In § 61.1, paragraph (c) is revised to read as follows:

§ 61.1 Purpose and scope.

(c)

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 §61.9b.

20.

Section 61.9b is revised to read as follows:

§ 61.9b 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:

(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, 34

regulation, or order; or any term, condition, or limitation of any license issued by the Co111nission; 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)(l) 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}(l} 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 of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Convnission; or (2)

Constitutes a violation of 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: Secs. 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.

35

201, as amended, 202, 204, 206, 88 Stat. 1242, as amended, 1244, 1245, 1246 (42 u.s.c. 5841, 5842, 5845, 5846).

Sections 70.l{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 70.2l(g} also issued under sec. 122, 68 S~at. 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 70.61 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).

22.

Section 70.2 is revised to read as follows:

§ 70.2 Scope.

Except as provided in §§ 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 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 § 70.10.

36

23.

Section 70.10 is revised to read as follows:

§ 70.10 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:

(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 Corm1ission; 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)(l) 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)(l) of this section, deliberate misconduct by a person means an intentional act or omission that the person knows:

37

(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 licensee, 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); secs. 201, as amended, 202, 206, 88 Stat. 1242, 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.

25.

Section 71.0 is amended by adding a new paragraph (f) to read as follows:

§ 71.0 Purpose 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, or quality assurance program approval or 38

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, or applicant's activities subject to this part, that they may be individually subject to NRC enforcement action for violation of

§ 71.11.

26.

Section 71.11 is added to read as follows:

§ 71. 11 Deliberate misconduct.

(a) This section applies to any---

(1) Licensee; (2) Certificate holder;

( 3) Quality assurance program 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 identified in paragraphs (a)(l) through (a){4) of this section; or (6) Employee of any person identified in paragraphs (a)(l) through (a)(S) of this section.

(b)

A person identified in paragraph (a) of this section who knowingly provides to any entity, listed in paragraphs (a){l) through (a)(S) 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 to this part may not:

39

(1)

Engage in deliberate misconduct that 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, regulation, or order; or any term, condition, or limitation of any license, certificate or approval issued by the Co1T111ission; or (2)

Deliberately submit to the ~RC, 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 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)(l) or (b)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR part 2, subpart 8.

(d)

For the purposes of paragraph (b)(l) 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 Co1T111ission; or (2)

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

40

PART 72--LICENSING REQUIREMENTS FOR THE INDEPENDENT STORAGE OF SPENT NUCLEAR FUEL AND HIGH-LEVEL RADIOACTIVE WASTE

27.

The authority citation for Part 72 continues to read as follows:

AUTHORITY: Secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 187, 189, 68 Stat. 929, 930, 932, 933, 934, 935, 948, 953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2232, 2233, 2234, 2236, 2237, 2238, 2282); sec. 274, Pub. L.86-373, 73 Stat. 688, as amended (42 U.S.C. 2021); sec. 201, as amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846); Pub. L.95-601, sec. 10, 92 Stat. 2951 (42 U.S.C. 5851); sec. 102, Pub. L.91-190, 83 Stat. 853 (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).

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

100-203, 101 Stat. 1330-232, 1330-236 (42 U.S.C. 10162(b}, 10168(c), (d)).

Section 72.46 also issued under sec. 189, 68 Stat. 955 (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(9), Pub. L. 100-203, 101 Stat. 1330-235 (42 U.S.C.

10165(9)).

Subpart J also issued under secs. 2(2), 2(15), 2(19), 117(a),

14l(h), Pub. L.97-425, 96 Stat. 2202, 2203, 2204, 2222, 2224 (42 U.S.C.

10101, 10137(a), 1016l(h)). Subparts Kand Lare also issued under sec. 133, 98 Stat. 2230 (42 U.S.C. 10153) and sec. 218(a), 96 Stat. 2252 (42 U.S.C.

10198).

41

~---------------

28.

Section 72.2 is amended by adding a new paragraph (f) to read as follows:

§ 72.2 Scope.

(f) This part also gives notice to all pe:*sons who knowingly provide to any licensee, certificate holder, applicant for a license or certificate, contractor, or subcontractor, components, 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 subject to NRC enforcement action for violation of§ 72.12.

29.

Section 72.12 is revised to read as follows:

§ 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, certificate holder, applicant for a license or 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 in deliberate misconduct that causes or would have caused, if not detected, a licensee, certificate holder or applicant to be in 42

violation of any rule, regulation, or order; or any term, condition, or limitation of any license or certificate issued by the Conmission; or (2)

Deliberately submit to the NRC, a licensee, a certificate holder, an 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 knows to be incumplete or inaccurate in some respect material to the NRC.

(b)

A person who violates paragraph (a)(l) 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)(l) 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 or applicant for a license or certificate to be in violation of any rule, regulation, or order; or any term, condition, or limitation, of any license or certificate issued by the Conmission; or (2)

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

PART 110--EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATERIAL

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, 129, 161, 181, 182, 183, 187, 189, 68 Stat. 929, 930, 931, 932, 43

933, 936, 937, 948, 953, 954, 955, 956, as amended (42 U.S.C. 2071, 2073, 2074, 2077, 2092-2095, 2111, 2112, 2133, 2134, 2139, 2139a, 2141, 2154-2158, 2201, 2231-2233, 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).

Sections 110.l(b)(2) and 110.l(b)(3) also issued under Pub. L. 96-92, 93 Stat. 710 (22 U.S.C. 2403).

Section 110.l~ also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152) and secs. 54c and 57d., 88 Stat. 473, 475 (42 U.S.C. 2074).

Section 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.

4t 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 U.S.C. 552, 554.

Sections 110.130-110.135 also issued under 5 U.S.C. 553.

Sections 110.2 and 110.42 (a)(9) also issued under sec. 903, Pub. L. 102-496 (42 U.S.C. 2151 et seq.).

31.

Section 110.1 is revised to read as follows:

§ 110.1 Purpose and scope.

(a)

The regulations in this part prescribe licensing, enforcement, and rulemaking procedures and criteria, under the Atomic Energy Act, for the export of nuclear equipment and material, as set out in §§ 110.8 and 110.9, and the import of nuclear equipment and material, as set out in § 110.9a.

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 44

applicant's activities subject to this part, that they may be individually subject to NRC enforcement action for violation of§ 110.7b.

32.

Section 110.7b is revised to read as follows:

§ 110.7b Deljberate 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:

(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 Conwnission; 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)(l) or (a)(2) of this section may be subject to enforcement action in accordance with the procedures in 10 CFR part 2, subpart B.

45

(c)

For the purposes of paragraph (a)(l) 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 of any rule, regulation, or order; or any term, condition, or limitation, of any license issued by the Conwnission; or (2)

Constitutes 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 AUTHORITY IN AGREEMENT STATES AND IN OFFSHORE WATERS UNDER SECTION 274

33.

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

AUTHORITY: 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, 150.15a, 150.31, 150.32 also issued under secs.

lle(2), 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, as amended (42 U.S.C. 2073).

Section 150.15 also issued under secs. 135, 141, Pub.L.97-425, 96 Stat. 2232, 2241 (42 U.S.C. 10155, 10161).

Section 150.17a also issued under sec. 122, 68 Stat. 939 (42 U.S.C.

2152).

Section 150.30 also issued under sec. 234, 83 Stat. 444 (42 U.S.C.

2282).

46

34.

Section 150.2 is revised to read as follows:

§ 150.2 Scope.

The regulations in this part apply to all States that have entered into agreements with the Commission or the Atomic Energy Commission pursuant to subsection 274b of the Act.

This part al5'J 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 licensee's, certificate holder's, quality assurance program approval holder's or applicant's activities subject to this part, that they ma~' be individually subject to NRC enforcement action for violation of§§ 30.10, 40.10, 70.10 and 71.11.

Dated at Rockville, Maryland, this 30th day of September, 1996.

For tne Nuclear Regulatory Commission.

William M~cting Secretary of the Commission.

47