WORLD TRADE
ORGANIZATIONGPA/W/183
19 February 2002
(02-0855)
Committee on Government Procurement Original:  English
RESPONSE TO REQUEST FROM JAPAN IN DOCUMENT GPA/W/162
REGARDING THE PROPOSED MODIFICATIONS TO APPENDIX I
OF THE UNITED STATES IN DOCUMENT GPA/W/153
Communication from the United States
The following communication, dated 12 February 2002, has been received from the
delegation of the United States with the request that it be circulated to the Committee on Government
Procurement.
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Question 1:  Please clarify, for each of the proposed modifications to Annex 1 and Annex 3 of
Appendix I, under which of Article XXIV:6(a) or Article XXIV:6(b) the notification has been made .
Response 1.1:  The following modifications to Annex 1 and Annex 3 of Appendix I are based on
Article XXIV:6(a):Annex 1
- Broadcasting Board of Governors
- The Corporation for National and Community Service
- United States Information Agency-A C T I O N
- Arms Control and Disarmament Agency
- The Interstate Commerce Commission
- Administrative Conference of the United States
- Board for International Broadcasting- Resolution Trust Corporation Oversight Board
Annex 3
- Rural Utilities Service Financing
- Rural Electrification Administration Financing
Response 1.2:  The following modifications to Annex 1 and Annex 3 of Appendix I are based on
Article XXIV:6(b):GPA/W/183
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Annex 1
- Panama Canal Commission
- Uranium Enrichment Corporation
Annex 3
- Alaska Power Administration
Question 2:  Regarding those modifications falling under Article XXIV:6(b) (e.g. the proposed
deletion of the "Uranium Enrichment Corporation"  from Annex 1, as this would seemingly be the
case), please explain that government control or influence over the entities concerned has been
effectively eliminated in light of the following items:
the existence of a legal nexus between the entity and the government;
direct or indirect ownership by the government;
the overall composition and concentration of shareholders in the company;the existence and degree of government support or subsidization for the entity, and whether
such support represents a one-time public investment or continuous operating subsidies;
formal or informal government oversight or supervision of the entity's business decisions,
beyond the normal regulatory oversight for all suppliers in a particular industry;
personal linkages between the entity and the government;
whether the entity is exclusively engaged in th e provision of goods or services in commercial
market subject to genuine competition, or whether it has mixed government and commercial
functions;
whether the government has granted special or exclusive legal or economic rights or benefits
which may alter the competitiveness of the entity's products in a commercial market or
otherwise influence the entity's business decisions.
Panama Canal Commission
As indicated in GPA/W/153, the Panama Canal Commission no longer exists.  All of its
procurement functions have been assumed by the Panama Canal Authority, which is a governmental
organization of the Republic of Panama.
Alaska Power Administration
In 1998, the Alaska Power Administration (APA) completed formal divestiture of all assets,
which were sold to Alaska municipal and privately owned energy cooperatives, as required by the
Alaska Power Administration Asset Sale and Termination Act [Public Law 104-58,22 November 1995].  APA was subsequently terminated as required by the Act.  At this time, the
Federal government does not provide any funding to, or maintain any oversight responsibilities for,
the former APA assets.GPA/W/183
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Uranium Enrichment Corporation
(1) Nexus with, or ownership by, the US Government/Composition of Shareholders
The "Uranium Enrichment Corporation" listed in Annex 1 of Appendix I refers to the  "United
States Enrichment Corporation" ("USEC"), which was created pursuant to the provisions of the
Energy Policy Act of 1992, Pub. L. No. 102-486, 106 Stat. 2776 (codified at 42 U.S.C. 2201 et seq. ).
USEC was a wholly owned US Government corpor ation until July 1998, when pursuant to the USEC
Privatization Act, Pub. L. No. 104-134, §§3101-3117, 110 Stat. 1321, 1335-1350 (codified at
42 U.S.C. §2297h et seq. ), the US Government sold its entire interest in the company by means of a
public offering of stock.  Pursuant to this transaction, USEC was merged into a private corporation,
also named United States Enrichment Corporation ("Enrichment Corporation"), and USEC ceased to
exist.
Today, the Enrichment Corporation is a who lly owned subsidiary of USEC Inc., a publicly
traded company whose shares are listed on the New York Stock Exchange.  USEC Inc.'s stock is
owned by approximately 29,000 benefi cial holders as of 15 August 2001.   The USEC Privatization
Act explicitly states that the Enrichment Corporation is not "an agency, instrumentality, or
establishment of the United States, a Government corporation, or a Government-controlled
corporation".  See 42 U.S.C. §2297h-3(b)(1).
(2) US Government Support/Subsidization of USEC
USEC does not receive any subsidies from the US Government.
(3) US Government Oversight or Supervision of USEC's Business Decisions (other than normal
regulation)
The US Government does not exert any control or influence over the activities carried out by
USEC, Inc.  As with other publicly traded compan ies in the nuclear industry, various US Government
agencies have regulatory functions or responsibilities related to activities of USEC, Inc.  These
agencies include the US Nuclear Regulatory Commission ("NRC"), the US Environmental Protection
Agency, the US Department of Transportation, the US Securities and Exchange Commission, the
US Occupational Safety and Health Administra tion and the US Departme nt of Energy ("DOE").
(4) Personal Linkages Between the US Government and USEC
There are no personal or personnel linkages between USEC and the US Government.
(5) Commercial Nature of the Market
Market Description and Market Participants:  USEC, Inc. is the only company in the United States
that enriches uranium for commercial use.
BWX Technologies (BWXT), in Lynchburg, Virginia, produces low enriched uranium (LEU)
through downblending of US Government weapons  material.  Currently, BWXT is downblending
material supplied by USEC, Inc. from an in ventory transferred to USEC, Inc. under the USEC
Privatization Act of 1996.
Several companies sell foreign-produced LEU in competition with USEC, Inc. in the United
States.  The two largest companies that sell LEU in the United States are Urenco Inc., the US
subsidiary of Urenco, Ltd. of the United Kingdom and Cogema Inc., the US subsidiary of Compagnie
Générale des Matières Nucléaires ("COGEMA"), of France.GPA/W/183
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LEU Production:  Only entities licensed by the NRC may produce LEU in the United States.
Federal regulations that apply to obtaining such licences are published in the US Government's Code
of Federal Regulations, Title 10, Part 2.
LEU Resale:  There is no specific US Government approval required to resell LEU.
However, the transportation of LEU requires a lic ence as does the importation/exportation of LEU.
All such licences are issued by the NRC or, in the case of domestic transportation of nuclear material,
the US Department of Transportation.
State of Competition: As described in the section on Market Description and Market
Participants, there is significant competition in this sector.
(6) Special or Exclusive Rights Granted to USEC
USEC, Inc. serves as the executive agent for the US Government in implementing an
Executive Agent agreement under which USEC, Inc. purchases LEU derived from highly enriched
uranium from the Russian Federation under the Agreement Between the Government of the UnitedStates of America and the Government of the Russian Federation Concerning the Disposition of
Highly Enriched Uranium Extracted from Nucl ear Weapons, dated 18 February 1993.  USEC, Inc.
can be replaced as the US Government's executive agent at any time.
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