Act on Compensation for Nuclear Damage(Act No. 147 of 1961)

As Amended by Act No. 19 of 17 April 2009

Contents
Part 1

General Provisions (Sections 1 and 2)

Part II

Liability for Nuclear Damage (Sections 3 to 5)

Part III

Financial Security

Chapter 1

Financial Security (Sections 6 to 7-2)

Chapter 2Contract of Liability Insurance for Nuclear Damage (Sections 8 and 9)

Chapter 3

Indemnity Agreements for Compensation of Nuclear Damage (Sections 10 and 11)

Chapter 4

Deposit (Sections 12 to 15)

Part IV

Measures taken by the State (Sections 16 and 17)

Part V

Dispute Reconciliation Committee for Nuclear Damage Compensation (Section 18)

Part VI

Miscellaneous Provisions (Sections 19 to 23)

Part VII

Penal Provisions (Sections 24 to 26)
Supplementary Provisions

PART I
General Provisions
Section 1

PurposeThe purpose of this act is to protect persons suffering from nuclear damage and to contribute to thesound development of the nuclear industry by establishing the basic system regarding compensation incase of a nuclear damage caused by reactor operation etc.

Section 2

Definitions

As used in this act, “reactor operation etc.” means any activity which comes under any one of thefollowing cases below as well as any incidental transport, storage and disposal of nuclear fuel ormaterial contaminated by nuclear fuel [including nuclear fission products; this applies also to subparagraph (v)], as provided by Cabinet Order:i)reactor operation;ii)

production;iii)

reprocessing;iv)

use of nuclear fuel;(iv-2) storage of spent fuel;(v)

waste disposal of nuclear fuel or material contaminated by nuclear fuel (referred to as “nuclear
fuel etc.” in the following paragraph and in Section 3, paragraph 2).

2. As used in this act, “nuclear damage” means any damage caused by the effects of the fission
process of nuclear fuel, or of the radiation from nuclear fuel etc., or of the toxic nature of suchmaterials (which means effects that give rise to toxicity or its secondary effects on the human body byingesting or inhaling such materials); however, any damage suffered by the nuclear operator who isliable for such damage pursuant to the following Section, is excluded.
3. As used in this act, “nuclear operator” means any person as specified under any one of thefollowing sub-paragraphs (including a person who had been deemed so previously).
(i)A person who is granted a permit as provided in Section 23 paragraph 1 of the Act for the
Regulation of Nuclear Source Material, Nuclear Fuel and Reactors (Act No. 166 of 1957;
hereinafter referred to as “the Regulation Act”) (including a national licence under theprovisions of the same paragraph applying instead by virtue of Section 76 of the RegulationAct) (including a person who is regarded as a reactor operator pursuant to Section 39, paragraph
5 of the Regulation Act);(ii)

A person who is granted a permit as provided in Section 23-2, paragraph 1 of the RegulationAct;(iii)A person who is granted a licence as provided in Section 13, paragraph 1 of the Regulation Act(including a national licence under the provisions of the same paragraph applying instead byvirtue of Section 76 of the Regulation Act);(iv)

A person who is granted a licence as provided in Section 43-4, paragraph 1 of the Regulation
Act (including a national licence under the provisions of the same paragraph applying insteadby virtue of Section 76 of the Regulation Act);(v)

A person who is granted a licence as provided in Section 44, paragraph 1 of the Regulation Act(including a national licence under the provisions of the same paragraph applying instead byvirtue of Section 76 of the Regulation Act);(vi)

A person who is granted a licence as provided in Section 51-2, paragraph 1 of the Regulation
Act (including a national licence under the provisions of the same paragraph applying insteadby virtue of Section 76 of the Regulation Act);(vii) A person who is granted a licence as provided in Section 52, paragraph 1 of the Regulation Act(including a national licence under the provisions of the same paragraph applying instead byvirtue of Section 76 of the Regulation Act);
4. As used in this Act, “reactor” means a reactor as provided in Section 3, paragraph 4 of the Basic
Atomic Energy Act (Act No. 186 of 1955), “nuclear fuel” means nuclear fuel as provided in Section 3,
paragraph 2 of the Basic Atomic Energy Act (including spent fuel as provided in Section 2, paragraph
8 of the Regulation Act), “production” means production as provided in Section 2, paragraph 7 of theRegulation Act, “reprocessing” means reprocessing as provided in Section 2, paragraph 8 of theRegulation Act, “storage of spent fuel” means the storage of spent fuel as provided in Section 43,
paragraph 4(1) of the Regulation Act; “waste disposal of nuclear fuel or material contaminated by
nuclear fuel”, means the underground disposal of waste and waste management as provided in
Section 51, paragraph 2(1) of the Regulation Act; “radiation” means radiation as provided in Section
3, paragraph 5 of the Basic Atomic Energy Act, and “nuclear ship” and “foreign nuclear ship” mean
nuclear ship and foreign nuclear ship as provided in Section 23-2, paragraph 1 of the Regulation Act.

PART II

Liability for Nuclear Damage
CHAPTER 1
Financial Security
Liability without fault, channelling of liability etc.
Section 3
Where nuclear damage is caused as a result of reactor operation etc. during such operation, the nuclear
operator who is engaged in the reactor operation etc. on this occasion shall be liable for the damage,except in the case where the damage is caused by a grave natural disaster of an exceptional characteror by an insurrection.

2. Where nuclear damage is covered by the preceding paragraph and if the damage is caused as aresult of the transport of nuclear fuel etc. between nuclear operators, the nuclear operator who is theconsignor of the nuclear fuel etc. shall be liable for the damage unless there is a special agreement
between the nuclear operators.

Section 4
Where nuclear damage is covered by the preceding section, no person other than the nuclear operator
who is liable for the damage pursuant to the preceding section shall be liable for the damage.
2. Where nuclear damage is covered by paragraph 1 of the preceding section, the liability of a nuclear
operator who furnishes the financial security as provided in Section 7-2, paragraph 2 and wants aforeign nuclear ship to enter into Japanese territorial waters shall be limited to the amount as provided
in Section 7-2, paragraph 2.
3. The provisions of Section 798, paragraph 1 of the Trade Act (Act No. 48 of 1899), the Act relating
to the Limitation of the Liability of Shipowners (Act No. 94 of 1975) and the Products Liability Act(Act No. 85 of 1994), shall not apply to nuclear damage which is caused as a result of reactor
operation etc.

Section 5

Rights of recourse

Where nuclear damage is covered by Section 3 and if the damage is caused by the wilful act of a third
party, the nuclear operator who has compensated the damage pursuant to Section 3 shall retain a rightof recourse against such third party.
The provisions of the preceding paragraph shall not prevent a nuclear operator from entering into a
special agreement with any person regarding rights of recourse.

PART III
Financial Security
CHAPTER 1
Financial Security

Section 6

Duty to provide financial security

A nuclear operator is prohibited from reactor operation etc. unless financial security for compensationof nuclear damage (hereinafter referred to as “financial security”) has been provided.

Details of financial security
Section 7
Except when the provisions of the following section are applicable, financial security shall be
provided by the conclusion of a contract of liability insurance for nuclear damage and an indemnity
agreement for compensation of nuclear damage or by a deposit, approved by the Minister for
Education, Culture, Sport, Science and Technology (MEXT) as an arrangement that makes available
for compensation of nuclear damage, 120 billion yen (in case of such reactor operation etc. The
Cabinet Order may provide for a lesser amount than 120 billion yen; hereinafter this amount isreferred to as “financial security amount”) for each installation or site or nuclear ship, or by anequivalent arrangement approved by MEXT.
2. Where the amount available for compensation of nuclear damage falls below the financial security
amount because the nuclear operator has paid compensation for nuclear damage pursuant to Section 3,
MEXT may, if it deems it necessary to ensure full compensation of nuclear damage, order the nuclear
operator to bring the amount available for compensation of nuclear damage up to the financial security
amount by a given time.
3. In the case provided for in the preceding paragraph, the preceding section shall not apply until theOrder is made pursuant to the preceding paragraph (until the time designated by the Order, where suchan Order has been made pursuant to the preceding paragraph).
Section 7-2
Where a nuclear operator wants a nuclear ship to enter into foreign territorial waters, financial security
shall be provided by the conclusion of a contract of liability insurance for nuclear damage and an
indemnity agreement for compensation of nuclear damage or by other financial security, approved by
MEXT as an arrangement that is sufficient for the compensation of nuclear damage, in the amountagreed between the Government of Japan and the Government of such foreign country and subscribedby the nuclear operator of the nuclear ship who is liable for the compensation of nuclear damage.
2. Where a nuclear operator wants a foreign nuclear ship to enter into Japanese territorial waters, thefinancial security shall be that approved by MEXT as an arrangement that is sufficient for thecompensation of nuclear damage, in the amount (not less than 36 billion yen in respect of nuclear
damage caused by any one incident) agreed between the Government of Japan and the Government ofsuch foreign country and subscribed by the nuclear operator of the foreign nuclear ship liable for thecompensation of nuclear damage.

CHAPTER 2
Contract of Liability Insurance for Nuclear Damage
Contract of Liability Insurance for Nuclear Damage
Section 8
The contract of liability insurance for nuclear damage (hereinafter referred to as “liability insurance
contract”) shall be the contract under which an insurer undertakes to indemnify a nuclear operator for
his loss arising from compensating nuclear damage, where the nuclear operator becomes liable forsuch nuclear damage, and under which the insurance policy holder has undertaken to pay a premium
to the insurer (this provision applies only to a person who is authorised to engage in liability insurance
activities pursuant to the Insurance Business act [Act No. 105 of 1995], such as a risk insurancecompany under Section 2, paragraph 4 of this same act, or a foreign risk insurance company underparagraph 9 of the same section, this being the meaning given to the term insurer used hereafter).
Section 9
Any person suffering from nuclear damage shall, with regard to his claim for such nuclear damage,have priority over other creditors in respect of compensation from the amount provided by the liability
insurance contract.
2. The insured may request the insurer to make the insurance payment only to the extent of theamount of compensation which the insured has paid or to the extent to which the insured has acquired
the consent of persons suffering from nuclear damage.
3. The right to request insurance payment under the liability insurance contract shall not be assigned,
mortgaged or seized; however, a person who has suffered nuclear damage may proceed with a seizure
with regard to his claim for nuclear damage.

CHAPTER 3
Indemnity Agreements for Compensation of Nuclear Damage
Indemnity agreements for compensation of nuclear damage
Section 10
An indemnity agreement for compensation of nuclear damage (hereinafter referred to as “indemnity
agreement”) shall be the contract by which the Government undertakes to indemnify a nuclear
operator for his loss arising from compensating nuclear damage not covered by the liability insurance
contract or other financial security for compensation of nuclear damage, where the nuclear operator
becomes liable for such damage, and under which that operator has undertaken to pay an indemnity
fee to the Government.
2. Provisions relating to indemnity agreements shall be laid down in another act.

Section 11
The provisions of Section 9 shall apply mutatis mutandis to the indemnity payment under theindemnity agreement.

CHAPTER 4
Deposit
Section 12

DepositA deposit for financial security shall be made in the Legal Affairs Bureau or the District Legal Affairs
Bureau nearest to the main office of the nuclear operator, either in cash or in securities as provided by
MEXT [including electronic securities specified in the Act on the Transfer of Securities such as
shares, company bonds etc. (Act No. 75 of 2001) Section 278, paragraph 1. This provision applies also
to what follows in this Chapter].

Section 13

Payment from deposit

Any person suffering nuclear damage may, with regard to his claim for compensation, receive
compensation from the cash or securities deposited by the nuclear operator pursuant to the preceding
section.

Section 14

Withdrawal of deposit

A nuclear operator may, in the following cases, withdraw the cash or securities deposited pursuant to
Section 12 with the approval of MEXT where:(i)the nuclear damage has been compensated;(ii)

financial security other than the deposit has been provided;(iii)

reactor operation etc. has ceased.

2. When MEXT grants an approval under the preceding sub-paragraphs (ii) or (iii), it may, to theextent that it deems it necessary to ensure full compensation of nuclear damage, designate the time
when the nuclear operator may withdraw cash or securities, as well as the amount of such withdrawal.

Section 15

Specifications by Orders

Provisions regarding deposits other than those provided in this Chapter shall be promulgated by
Orders of MEXT and the Ministry of Justice.

PART IV
Measures taken by the State
Section 16
Where nuclear damage occurs, the Government shall give a nuclear operator (except the nuclear
operator of a foreign nuclear ship) such aid as is required for him to compensate the damage, when theactual amount which he should pay for the nuclear damage pursuant to Section 3 exceeds the financial
security amount and when the Government deems it necessary in order to attain the objectives of thisact.
2. Aid as provided for in the preceding paragraph shall be given to the extent that the Government isauthorised to do so by decision of the National Diet.

Section 17
Where the provision for exoneration in Section 3, paragraph 1 applies or where nuclear damage isdeemed to exceed the amount provided under Section 7-2, paragraph 2, the Government shall take thenecessary measures to relieve victims and to prevent the damage from spreading.

PART V
Dispute Reconciliation Committee for Nuclear Damage Compensation

Section 18

Dispute Reconciliation Committee for Nuclear Damage Compensation

The Dispute Reconciliation Committee for Nuclear Damage Compensation (hereinafter referred to as“Reconciliation Committee”) may be established as an organisation attached to MEXT, pursuant to theprovisions laid down by Cabinet Order; this Committee shall be in charge of mediating reconciliationof any dispute arising from compensation of nuclear damage and of preparing general instructions to
help operators reach a voluntary settlement of such disputes.
2. The Reconciliation Committee shall:(i)mediate reconciliation of any dispute arising from compensation of nuclear damage;(ii)in the event of a dispute arising from compensation of nuclear damage, draft instructions
establishing the scale of the nuclear damage and other general instructions to help operators
reach a voluntary settlement of the said dispute;(iii)

investigate and assess nuclear damage as necessary for dealing with the matters mentioned in (i)and (ii) above.

3. Provisions regarding the organisation and operation of the Reconciliation Committee as well asprocedures for a request for, and conduct of, mediation other than those provided in paragraphs 1 and2 shall be promulgated by Cabinet Order.

PART VI
Miscellaneous Provisions
Section 19

Presentation of reports and written opinions to the National Diet

Where nuclear damage occurs on a comparatively large scale, the Government must report to the
National Diet as soon as possible on the extent of the damage and on the measures it has taken
pursuant to this act.
2. When nuclear damage occurs, the Government must present to the National Diet the written
opinion regarding mitigation, prevention etc. of the damage, which the Atomic Energy Commission or
the Nuclear Safety Commission has submitted to the Prime Minister.

Section 20

Application of Section 10, paragraph 1 and Section 16, paragraph 1

The provisions of Section 10, paragraph 1 and Section 16, paragraph 1 shall apply to nuclear damage
arising from reactor operation etc. in respect of which the activity, falling under any one of subparagraphs mentioned in Section 2, paragraph 1, has begun by 31 December 2019.

Section 21

Submission of reports and inspections

MEXT may, if it deems it necessary to ensure execution of the provisions of Section 6, require a
nuclear operator to present any necessary reports or allow his officials to enter the latter’s office,installation or site or his nuclear ship, to inspect his books, documents and other necessary objects, orto ask questions of the persons concerned.
2. When an official enters premises pursuant to the preceding paragraph, he shall carry an
identification card and present it if requested by the persons concerned.
3. The right to conduct an inspection pursuant to paragraph 1 shall not be construed as a right toinvestigate a criminal offence.

Section 22

Consultations with the Minister for the Economy, International Trade and Industry(METI) or with the Minister for Regional Development, Infrastructure, Transport andTourism (MLIT)

When MEXT takes action pursuant to Section 7, paragraph 1 or Section 7-2, paragraphs 1 or 2, ormakes Orders pursuant to Section 7, paragraph 2, it shall hold prior consultations with the Minister for
the Economy, International Trade and Industry (METI) in cases concerning reactors for the productionof electricity, the production, reprocessing or storage of spent nuclear fuel or the disposal of wasteconsisting of nuclear fuel or materials contaminated by nuclear fuel, or the Minister for Regional
Development, Infrastructure, Transport and Tourism (MLIT) in cases concerning reactors installed invessels.

Section 23

Exclusion of application to the state

The provisions of Part III, Section 16 and Part VII shall not apply to the state.

PART VII
Penal Provisions
Section 24
A person who breaches the provisions of Section 6 shall be punishable by imprisonment of not morethan one year, or by a fine not exceeding 1 000 000 yen, or both.

Section 25
A person shall be punishable by a fine not exceeding 1 000 000 yen for:(i)

failing to present a report pursuant to Section 21, paragraph 1, or presenting a false report;(ii)

refusing access to inspectors or interrupting or evading them, or refusing to answer a question
pursuant to Section 21, paragraph 1 or giving a false answer to such a question.

Section 26
When the representative of a legal entity, or the agent or other employee of a legal entity or of anatural person commits any one of the offences referred to in Sections 24 and 25 in connection withthe business of the legal entity or the natural person, the legal entity or the natural person shall, in
addition to punishment of the actual offender, be punishable by a fine as provided in the said sections.

Supplementary Provisions (Omitted)
Date of entry into force
Section 1
This act shall enter into force on the date laid down by Cabinet Order and at the latest, nine months
after the date of its promulgation.

Section 3
The penal provisions relating to acts committed before the entry into force of this act or to acts
committed before the provisions laid down in Section 26, paragraph 1 of the Compensation Act cease
to apply shall, before amendment by the provisions of this act and after its entry into force (thisconcerns the part relating to Section 23, paragraph 2 (9) of the said act), remain applicable.

Section 4

Adjustment of indemnities pursuant to other legislation

In the circumstances referred to in the preceding section, when the employees of a nuclear operator
suffer nuclear damage and the nuclear operator is liable for such damage pursuant to the said section(designated simply, in the rest of this section, as “nuclear operator”), such employees or the families ofthe deceased shall receive an indemnity as laid down by Cabinet Order in the form of an indemnity
under the provisions of the Insurance Act for the Compensation of Work Accidents (Act No. 50 of
1947) and equivalent to the compensation of such damage, or any other indemnity governed by otherprovisions of the act (hereinafter referred to in this section as “compensation for work accidents”). In
such cases, any compensation of nuclear damage paid to employees or the families of the deceased
shall be temporarily subject to the following provisions:(i)the nuclear operator shall be entitled not to pay indemnification, and that during a period which
may extend to the extinction of the right of employees or families to receive compensation forwork accidents, up to an amount equal to the value of the said compensation for work accidents
calculated at the legal rate in force between the time when the damage occurred and the date on
which the compensation for work accidents was paid;(ii)

where the circumstances of the preceding paragraph apply, when compensation for work
accidents has been paid, the nuclear operator shall be exonerated from his indemnification
obligation up to an amount equal to the value of the said compensation for work accidents
calculated at the legal rate in force between the time when the damage occurred and the date on
which the compensation for work accidents was paid.

2. Where the employees of a nuclear operator have suffered nuclear damage and such damage wascaused intentionally by a third party, the nuclear operator who has paid compensation for work
accidents to the employees or families of the deceased shall retain a right of recourse against suchthird party.
Supplementary Provisions (Act No. 19 of 17 April 2001)
This act shall enter into force on 1 January 2010.