ML24346A100
| ML24346A100 | |
| Person / Time | |
|---|---|
| Issue date: | 12/13/2024 |
| From: | Deanna Zhang NRC/NRR/DRO/IQVB |
| To: | |
| References | |
| Download: ML24346A100 (20) | |
Text
December 13, 2024 Deanna Zhang NRR/DRO/IQVB An Overview of NRCs Regulatory Requirements and Guidance on Counterfeit, Fraudulent, and Suspect Items (CFSIs)
Objective
- Present an overview of the NRCs regulatory requirements and guidance for addressing risk posed by CFSI to NRC regulated facilities and activities
- Present on the NRCs Technical Review Group (TRG) process for evaluating CFSI events for applicability to NRC licensed facilities 2
Definition CFSIs are items that are intentionally manufactured or altered to imitate a legitimate product without the legal right to do so (counterfeit); intentionally misrepresented with the intent to deceive (fraudulent); or reasonably suspected of being counterfeit or fraudulent (suspect).
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Background===
Integrity of the supply chain is a fundamental element of an effective QA program for NRC regulated facilities During the late 80s and early 90s, the NRC and commercial nuclear power industry performed a major reassessment of the supply chain in response to CFSI The NRC issued generic communications to inform licensees and suppliers about threats, methods to identify the CFSI, and steps to mitigate risk to the nuclear supply chain, which remained effective for more than two decades.
Recently with more NRC regulated facilities migrating from analog to digital technology, there has been a greater need for the NRC to evaluate the risks and vulnerabilities to potential CFSI, as experienced by other nonnuclear industries.
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History of NRCs Approach to Address CFSI The NRCs regulatory framework to address CFSI include:
- Regulatory requirements to ensure integrity of the supply chain
- Regulatory guidance that address CFSI risks to the commercial nuclear industry
- Oversight programs to verify compliance to NRC requirements
- Outreach and communications to highlight the risk of CFSI to internal and external stakeholders
- Evaluation of CFSI events for applicability to the commercial nuclear industry.
Collectively, the elements of this regulatory framework appropriately mitigate risks posed by the introduction of CFSI into NRC regulated facilities.
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CFSI is encompassed in NRC regulations for quality assurance and defect reporting 6
Appendix B to 10 CFR Part 50 Appendix B to 10 CFR Part 50 areas:
- 1) Design control
- 2) Procurement document control
- 3) Control of purchased materials, equipment, and services
- 4) Identification and control of material, parts, and components
- 5) Disposition of nonconforming materials, parts, or components
- 6) Corrective action and program effectiveness reviews 10 CFR Part 21 and 10 CFR 50.55(e)
- 1) Evaluation of deviations and failures to comply to identify defects and failures to comply associated with substantial safety hazard
- 2) Notification to NRC when there is information indicating a failure to comply or a defect
CFSI and Deviations RG 1.234, Evaluating Deviations and Reporting Defects and Noncompliance Under 10 CFR Part 2, Revision 1, endorses NEI 14-09, Guidelines for Implementation of 10 CFR Part 21 Reporting of Defects and Noncompliance Revision 1, with conditions.
RG 1.234 states counterfeit and fraudulent items are considered to be deviations that must be evaluated in accordance with the requirements of 10 CFR Part 21.
Not all deviations or nonconformances may be caused by counterfeit, fraudulent, or suspect items.
Design deficiencies, poor testing strategies, and substandard parts are quality issues but do not involve CFSIs.
7 counterfeit and fraudulent items deviation deviation counterfeit and fraudulent items X
8 In accordance with 10 CFR 50.5, 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.
Falsified and fraudulent information provided by an Appendix B supplier to the licensee are within the scope of deliberate misconduct.
Deliberate Misconduct
9 Per 10 CFR 50.90 (a) Information provided to the Commission by an applicant for a license or by a licensee or information required by statute or by the Commission's regulations, orders, or license conditions to be maintained by the applicant or the licensee shall be complete and accurate in all material respects.
(b) Each applicant or licensee shall notify the Commission of information identified by the applicant or licensee as having for the regulated activity a significant implication for public health and safety or common defense and security.
Completeness and Accuracy of Information
Key Guidance Documents for CFSI and Recent Information Notices on CFSI events 10 Information Notice (IN) 2018 NRC Bulletin 1988 Information Notice (IN) 2018-11 Supplement 1: Kobe Steel Quality Assurance Record of Falsification IN 2013-15 Willful Misconduct/Record Falsification and Nuclear Safety Culture IN 2013-02 Issues Potentially Affecting Nuclear Facility Fire Safety IN 2008-04 Counterfeit Parts Supplied to Nuclear Power Plants NRC Bulletin 1988-010 Nonconforming Molded-Case Circuit Breakers Regulatory Issue Summary (RIS)-15-08, Oversight of Counterfeit, Fraudulent, and Suspect Items in Nuclear Industry, Revision 1, heightens awareness of the existing NRC regulations and how they apply to CFSI within the scope of NRCs regulatory jurisdiction. (ADAMS Accession No. ML24184B841)
Generic Letter 89-02, Actions to Improve the Detection of Counterfeit and Fraudulently Marketed Products shares information regarding elements of programs that appear to be effective in providing the capability to detect counterfeit or fraudulently marked products.
https://www.nrc.gov/reading-rm/doc-collections/gen-comm/gen-letters/1989/gl89002.html
Other Sources of Guidance 11 International Guidance IAEA Publication on Managing Counterfeit and Fraudulent Items in the Nuclear Industry NEA CNRA CP-VICWG-04 Common Position on Counterfeit, Fraudulent, and Suspect Items Procedure Nuclear Industry Guidance EPRI Technical Report 3002002276 Plant Support Engineering: Counterfeit and Fraudulent Items - Mitigating the Increasing Risk NEI 14-09, Revision 1, Guidelines for Implementation of 10 CFR Part 21 Reporting of Defects and Noncompliance, as endorsed in NRC RG 1.234 Resources from other Federal Agencies Department of Homeland Security National Intellectual Property Rights Coordination Center https://www.iprcenter.gov/
Department of Energy (DOE) Operating Experience Committee https://www.energy.gov/ehss/doe-corporate-operating-experience-program
- OpE Clearinghouse
- Other Federal Agencies
- Regulatory counterparts in other countries
- Interactions with external stakeholders and industry working groups
- Resident and vendor inspectors
- Issues identified by other TRGs
- Evaluate the collected CFSI information for potential impact on the safe operation of NRC regulated entities
- Recommend actions based on results of evaluation 12
CFSI TRG Review Process: Phase One 13
CFSI TRG Review Process: Phase Two 14
Recently Issued CFSI Guidance and Training Revised CFSI TRG Desktop Guide to include a more detailed and systematic process for collecting and disseminating CFSI and communicated the information in the desktop guide to internal stakeholders.
Developed agency charter that documents objectives, approach and strategy for CFSI-related oversight of NRC regulated facilities and activities.
Included a CFSI category in the Allegations Management System.
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Recently Issued CFSI Guidance and Training (Contd)
Incorporated definition of CFSI in formal NRC guidance documents (e.g., RG 1.164, Revision 1, RG 1.124, Revision 1, RIS 2015-08, Revision 1).
Developed additional inspection guidance for CFSI-related oversight activities.
Develop CFSI training for inspectors and included CFSI as a topic in inspector qualification requirements.
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Key Takeaways
- CFSI is encompassed in NRC regulations for quality assurance and defect reporting
- NRC staff has taken a proactive approach to its oversight of CFSI through issuance of CFSI-related guidance, development of processes to evaluate potential CFSI events, and performance of outreach activities with internal and external stakeholders.
- The NRC has recently developed additional regulatory and oversight CFSI guidance for internal and external stakeholders.
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Questions 18
Acronyms CFR: Code of Federal Regulations CFSI: counterfeit, fraudulent, and suspect item DHS: Department of Homeland Security DOE: Department of Energy EPRI: Electric Power Research Institute IAEA: International Atomic Energy Agency IN: Information Notice IPR: Intellectual Property Rights (Coordination Center)
MDEP: Multi-national Design Evaluation Program NEA: Nuclear Energy Agency NEI: Nuclear Energy Institute OIG: Office of the Inspector General RIS: Regulatory Information Summary RG: Regulatory Guide WGVIC: Working Group Vendor Inspection Co-operation 19
Resources https://www.nrc.gov/about-nrc/cfsi.html https://www.iprcenter.gov/
https://www.epri.com/research/products/300200 2276 https://www.iaea.org/publications/11182/managi ng-counterfeit-and-fraudulent-items-in-the-nuclear-industry https://www.energy.gov/ehss/doe-corporate-operating-experience-program 20