Issue Date: 10/25/06 -1- 88114

NRC INSPECTION MANUAL RII

INSPECTION PROCEDURE 88114

QUALITY AFFECTING ITEM PROCUREMENT (10 CFR PART 21) AND 

COMMERCIAL GRADE ITEM DEDICATION PROCESS (REACTIVE)

PROGRAM APPLICABILITY: 2630

88114-01 INSPECTION OBJECTIVES

To determine whether the failure of an item relied on for safety (IROFS) was the result of

a deficient quality-affecting item (QAI) procurement process (10 CFR Part 21) or a

commercial-grade item (CGI) dedication process. 

88114-02 INSPECTION REQUIREMENTS

02.01 Reactive Inspection Requirements (to be performed after the failure of a QAI or CGI

dedicated for safety-related applications during the pre-operational or operational phases).

a. Initial Evaluation After reviewing the licensee's evaluation of the failed item,

determine if the failed item was procured as a QAI or CGI and dedicated for safetyrelated applications. If the failed item was dedicated, review the complete

procurement and dedication records to determine if the commercial-grade

dedication process was sufficiently thorough.

b. Further Assessments If it is determined that the dedicated item failed as the result

of certain critical characteristics not being identified and/or properly verified, perform

the following assessments:

1. Determine if other QAIs or CGIs from the same accepted lot or batch as the

failed QAI or dedicated CGI have been similarly dedicated and installed in

other safety-related applications. If yes, determine if the licensee has

evaluated the operability of the systems or components where these QAIs

or CGIs are installed. The inspector also should review licensee-provided

data, if available, for some CGIs (non-dedicated) that failed in applications

that were not safety-related. Explore the possibility that the same CGIs also

may have been used (following dedication) in a safety-related application and

may have the potential to affect the safe operation of a structure, system or

component (SSC).

2. If possible select and evaluate, as in step 1 above, at least three other QAIs

or dedicated CGIs having similar applications and critical characteristics as

the QAI(s) or CGI(s) that resulted in the identified failures. 

02.02 Programmatic Reactive Inspection Requirements (If, after performing the step

above, it is determined that there were weaknesses in the CGI dedication process, the
88114 - 2 - Issue Date: 10/25/06

inspector should perform a more comprehensive inspection of the licensee's dedication

process, in accordance with the inspection requirements in Section 02.02 below.)

a. Review of Program and Procedures Using the inspection guidance contained in

Section 03.02 and Appendix A to this procedure, review the licensee's program and

procedures for the procurement of QAIs and procurement and dedication of CGIs,

to understand the basic operation of the licensee's program. 

b. Selection of Dedication Packages Select several dedication packages for

evaluation from a list of commercially dedicated items provided by the licensee.

Request that the licensee provide (or make available for review) a complete

package of the pertinent procurement and dedication records for each item. 

c. Evaluation of Dedication Packages Using the inspection guidance contained in

Section 03.01 of this procedure, perform a detailed evaluation of the dedication

packages selected in item b, above.

d. Evaluation of Training Effectiveness If the inspector's evaluation of commercialgrade dedication activities indicates there are weaknesses in the way these

activities are being performed, the inspector should investigate further to determine

if weaknesses within the licensee's training program may have contributed to the

cause. The inspector should determine if the licensee is implementing an effective

training program. 

88114-03 INSPECTION GUIDANCE

Background. Licensees are required to ensure the quality of items purchased and installed

in safety-related applications. In the past, licensees procured major assemblies from

approved vendors who maintained quality assurance (QA) programs pursuant to the

licensee’s NRC-approved QA program requirements. Because of the decrease in the

number of qualified vendors, licensees are increasing the number of commercial-grade

replacement parts that they procure and dedicate for use in safety-related applications. 

Since CGI dedications have increased in number, it is intended that this inspection

procedure provide guidance to assist the inspector in assessing the effectiveness of the

implementation of the licensee's commercial-grade procurement practices and provide for

identification of any adverse trends or emerging problems.

Scheduling the Inspection. This inspection procedure should be considered for

implementation when there is reason to believe that the failure of an IROFS , or a part

thereof, to perform its intended safety function, was the result of weaknesses in QAI

procurement or CGI dedication. This inspection procedure may be implemented

independently, or it may be used as a supplement to other major team inspections. Such

inspections may include maintenance; modification; or system-specific inspections, where

review of failed IROFS, or parts thereof, is appropriate; or an augmented inspection team

investigating failures. 

Before the beginning of the onsite inspection, advise the licensee of information that will

be needed, such as a list of items that the licensee purchased as commercial grade and

subsequently dedicated for use in safety-related applications. In addition, the inspector

should request and review the licensee's program and procedures to become familiar with

the licensee's procurement and dedication process. Also explore with the licensee the

possibility of obtaining a list of recent component failures. The list of component failures

can be used by the inspector, during the selection of dedication packages for review, as

described in this inspection procedure.
Issue Date: 10/25/06 -3- 88114

SPECIFIC GUIDANCE

03.01 Reactive Inspection

a. Initial Evaluation. A failure resulting from general weaknesses in the QAI

procurement or commercial-grade dedication program may occur when the

important design, material, and performance characteristics that are necessary to

provide reasonable assurance that the QAI or dedicated CGI will perform its

intended safety function are not addressed during procurement or dedication. For

example, failures of safety-related bolting have occurred when the dedication

process did not verify that the material composition and/or mechanical properties

met the specified requirements, and nonconforming material was supplied.

Review and discuss, with licensee personnel, the failure/root-cause analysis when

required or applicable for the failed QAI or CGI. The inspector should attempt to

determine if the failure was caused by a design deficiency, failure unrelated to the

item's safety function, or normal wear, and eliminate these from further review. The

inspector should focus on the inspection of failures that appear to be caused by

weaknesses in the commercial-grade dedication process. If none of the failures

are caused by weaknesses in the commercial grade dedication process, then the

inspector should not continue using this inspection procedure. If the inspector

decides to change the focus of the inspection to examine other issues related to

the failures, such as the adequacy of corrective actions, other procedures should

be used. Once the failure mode and cause of failure have been postulated or

determined, review the dedication package to determine if the licensee had

identified critical characteristics. Appendix A to this inspection procedure should

not be interpreted as inspection requirements, but only as a discussion of

dedication issues, including guidance on selection and verification of critical

characteristics. Appendix A, if properly implemented, represents an acceptable

means of complying with regulatory requirements. The licensee may develop

alternate methods of achieving compliance with 10 CFR Part 70, the Construction

Authorization Request, the QA Plan; and the implementing procedures. Appendix

B to this inspection procedure, provides definitions of terms used for commercialgrade dedication activities, and Appendix C provides the typical contents of a

dedication package.

The goal of the review of the procurement or dedication packages is to provide

reasonable assurance that the CGIs dedicated for safety-related applications will

perform their intended safety functions. Inspection effort should be directed toward

the identification of weaknesses, in the dedication process, that could potentially

render IROFS, or parts thereof, inoperable. 

(1) Review of Dedication Packages. After becoming familiar with the licensee's

procurement and dedication program and procedures, perform a detailed review

of dedication packages as described below.

! Determine if the safety function of the item for its intended use has been

identified by reviewing the documents associated with the technical evaluation

including, as applicable:

- Classification of the item,

- Consideration of credible failure modes, and

- Item equivalency/substitution evaluations.
88114 - 4 - Issue Date: 10/25/06

! Determine if the important design, material, and performance characteristics,

necessary to provide reasonable assurance that the item will perform its

intended safety function (critical characteristics), have been identified.

! Determine whether the licensee verified the critical characteristics, using

appropriate acceptance methods. If appropriate, take into account postinstallation testing and periodic surveillance testing and inspection. Review

the engineering judgment when it is used as the basis for selection or

verification of critical characteristics.

! Determine whether the item is an equivalent replacement or a new-item

replacement of an obsolete item.

! Determine if the item is or may be used in a different safety-related

application, than previously evaluated, in which different design, material, and

performance characteristics may be applicable. This is especially applicable

for generic dedications of bulk items and stock material. Determine if the

dedication ensures the acceptability of those design, material, and performance characteristics relevant to the safety function.

! Determine why the item is being replaced. Have there been repeated

failures? Is the degraded performance a result of adverse environment? Did

it fail because it was a refurbished or fraudulent item? 

! Determine how the identity of the item is controlled from the time it is receipt

inspected, until the time it is installed. 

! Determine if information learned during the dedication process is fed back

to the appropriate persons to evaluate existing stock items, or installed items,

and for future use in surveys and source verifications. This information could

include positive and adverse findings obtained during surveys and source

verifications. 

Refer to the discussion of significant dedication issues in Appendix A for guidance

during the review of dedication packages. Also refer to the specific guidance for

each of the four dedication methods provided below.

Focus should be on those activities that are likely to affect the performance of the

items being dedicated. Although the acceptance process for dedication is subject

to the licensee’s U.S. Nuclear Regulatory Commission approved QA program

requirements, it is not necessary to review the licensee's programmatic compliance

to the QA requirements, since they may not apply to the activities reviewed. The

licensee’s NRC-approved QA program requirements do not apply to commercialgrade activities, that occur before dedication for use in a safety-related system. It

also should be recognized that Appendix B provides for the application of QA to

safety-related systems and components consistent with their importance to safety

(graded-quality approach).

Although guidance concerning the application of graded QA is discussed in the first

paragraph of Appendix A to this inspection procedure, it is expected that the

inspector will need to exercise considerable judgment in determining the adequacy

of controls applied to a specific activity.

(2) Review of Acceptance Methods

The following are the four acceptance methods that can be used to accept CGIs.

These methods provide, either individually or in combination, a means to
Issue Date: 10/25/06 -5- 88114

reasonably ensure that a CGI that is received meets the requirements of the item

specified. The results of employing each method should be documented.

Method 1 - Special Tests and Inspections

General information on similar activities is provided in American National Standards

Institute (ANSI N45.2.13-1976), Section 10, "Acceptance of Item or Service." Use

the following approach to review packages that were dedicated using this method:

! To the extent practicable, attempt to witness receipt inspections and tests of

in-process dedication of CGIs similar to that of the failed item, to verify the

identified critical characteristics.

! Review receiving records and associated tests and inspections.

! Review post-installation test records.

! Verify that the tests and inspections specified for acceptance adequately

verify the identified critical characteristics.

! Verify that sampling plans are controlled and have adequate technical basis,

considering lot traceability and homogeneity, complexity of the item, and

adequacy of supplier controls.

! Verify that CGI receiving inspection activities are adequately controlled, under

a quality program, regardless of whether they are being performed in

conjunction with other plant receipt inspection activities.

! Verify that receipt inspection activities establish and maintain traceability of

CGIs by capturing and appropriately relating traceability documents through

identification and monitoring of CGIs.

! Verify that measuring and test equipment were properly calibrated, that

approved vendors were used to perform tests, and that personnel were

qualified to perform the tests.

Method 2 - Commercial-Grade Survey

Use the following guidance to review packages that were dedicated using this

method:

! Confirm that: (1) the documented commercial-quality program was effectively

implemented; and (2) the surveys were conducted at the location necessary

to verify that adequate controls were exercised on distributors as well as

manufacturers. 

! Through interview, determine if the persons who perform vendor surveys are

knowledgeable in the following: 

- The use of performance-based surveys

- Screening third-party surveys; and

- Processing and evaluating adverse findings resulting from the review

of third-party surveys, to ascertain if those findings affect CGIs already

installed, or stored in the warehouse, awaiting future installation.
88114 - 6 - Issue Date: 10/25/06

! Verify that the supplier's commercial quality controls are imposed in the

procurement documents.

! Determine if the critical characteristics that are to be verified by the survey

team are accurately and completely incorporated in the survey plans.

! Determine if the validity of supplier documentation, relied on in the dedication

of the item, is verified during the survey.

! Determine if surveys of commercial-grade suppliers are performance based,

as opposed to programmatic. Specifically, verify that the critical characteristics for the CGIs being surveyed are controlled by the supplier's quality

activities. 

! Determine if survey teams include technical and quality personnel, as

appropriate, who are knowledgeable in the operation of the item(s) and the

associated critical characteristics to be verified, including any special

processes such as welding and heat treatment that are specific to the critical

characteristics.

! Determine if surveys are conducted at appropriate times relative to the

procurement. Are surveys required to be updated on a regular basis to

support dedication?

! Determine if the control of subvendors is adequately addressed by the

surveys so that the supplier has an adequate basis to accept test results and

certifications from the subvendor. 

! Determine if pertinent information about a supplier or its products is used to

plan, conduct, and report results of surveys and source verifications. Such

information could have been available from source verifications, receiving

inspections, the dedication process, supplier/product performance history,

or outside sources, such as NRC information notices and bulletins.

Method 3 - Source Verification

Use the following approach to review packages that were dedicated using this

method:

! Determine if source verifications involve witnessing the supplier performing

quality activities on the actual items being procured and adequately verify the

item's critical characteristics. 

! Determine if personnel who participated in the source verification surveys

were qualified for their specific assignment.

! Determine if appropriate hold points are imposed in the purchase orders.

This would include a hold point to verify design, material, and performance

characteristics, relevant to the safety function, that cannot be verified after

the item has been completely manufactured. 

! Determine if the results of the source verifications were adequately

documented.
Issue Date: 10/25/06 -7- 88114

Method 4 - Acceptable Supplier/Item-Performance Record

Use the following guidance to review packages that were dedicated using this

method:

! Determine if (1) the established historical record is based on industry-wide

performance data that are directly applicable to the item's critical characteristics and the intended safety-related application; and (2) the manufacturer's

measures for the control of design, process, and material changes have been

adequately implemented, as verified by survey (multi-licensee team surveys

are acceptable). 

! Determine if information pertinent to the CGI's quality of performance,

obtained from outside sources (e.g., operational event reports, NRC, vendor

equipment, and technical information program) and from commercial-grade

surveys, source verifications, receipt inspections, previous dedication, or

qualification and operational history, is factored into the dedication process.

! Determine if the item or manufacturer is included in the licensee's

performance-trending program. 

b. Further Assessments

1. No inspection guidance.

2. From the list of dedicated items provided by the licensee, the inspector should

select for review approximately three other dedication packages having

similar applications and critical characteristics as the CGI(s) that resulted in

the identified failures. After the selections have been made, the inspector

should request that the licensee compile a complete package of all the

procurement and dedication records for each item. Typical contents of a

dedication package are described in Appendix C of this inspection procedure.

The inspector should review the dedication packages.

3. No inspection guidance.

03.02 Programmatic Inspection

a. Review of Program and Procedures. The review of the program and procedures

should be performed to familiarize the inspector with the licensee's QAI procurement and CGI dedication process. For cases in which problems are identified with

the licensee's CGI dedication process, the inspector may decide to perform a more

extensive review of the program and procedures, to determine if these problems

are the result of inadequate procedures. 

The inspector's review should include procedures for: (1) procurement activities;

(2) material control; (3) the dedication of CGIs, including receipt inspection and

acceptance testing; (4) surveys of commercial-grade suppliers; (5) classification

of components; (6) training of personnel; (7) trending of supplier performance; and

(8) equipment failures. Attempt to identify any apparent weak areas to concentrate

on during the evaluation of the program implementation. 

After arriving onsite, the inspector should request that the licensee explain its

commercial-grade dedication process and conduct a walk-through of areas

associated with it. Areas in the walk-through could include the engineering, receipt

inspection, component testing, and warehouse. The inspector should become

familiar with key licensee personnel involved in the commercial-grade dedication
88114 - 8 - Issue Date: 10/25/06

process. These key personnel should include the responsible engineer(s) who

developed the dedication package(s), and systems engineers, procurement

engineers, receipt inspectors, QA engineers and inspectors, and warehouse

personnel. The inspector should discuss the commercial -grade dedication process

with these key personnel, to gain a better understanding of the process, including:

! How processing of QAI and CGI procurement documents is controlled under

the QA program and how quality control will receive, review, and approve

items. 

! How technical personnel participate in the preparation, review, and approval

process of procurement documents.

! How consistency and coordination is maintained between corporate level,

engineering/support level, and site-level programs and implementing

procedures.

b. Selection of Dedication Packages. 

The selection process should be performance-oriented (e.g., weighted toward the

review of dedication packages for equipment, components, or parts that have

experienced failures). To accomplish this, the inspector should request, from the

licensee, several packages for review, using the two-step approach described

below. The licensee should be given sufficient lead time to prepare the packages

and make them available for the first day of onsite inspection.

Step 1: Review the licensee's records available at the plant site, to identify recent

failures (approximately the last 2 years) of equipment, components, or parts.

Review these failures to determine if any were QAIs or CGIs dedicated for use in

safety-related applications. If available, select approximately 75 percent of the total

sample from QAI or CGI failures.

Step 2: From the list of dedication packages supplied by the licensee, under the

"Inspection Guidance" section of this procedure, select the remainder of packages

for review. The total sample size will vary, depending on the complexity of the

packages and the time available. The inspector should select these packages on

the basis of the following considerations: 

! The inspector should select packages for items whose failure would have the

most effect on the ability of the facility to safely operate, safely shutdown from

an adverse condition, or maintain a safe shut down condition. If time permits,

review the plant-specific integrated safety analysis and the safety evaluation

report that provides information on the risk significance of safety-related plant

equipment. 

! The inspector should take a performance-oriented approach, to the selection

process, by including, in the sample packages, those items that have been

problems in the past. Review available sources of information to identify any

known failures of QAIs or CGIs that were used in safety-related applications.

These sources of information could include:

- Component failure lists or lists of items requiring frequent maintenance

or replacement, as provided by the licensee. 

- Misrepresented or fraudulent items reported in NRC information notices.

- Licensee trending of equipment and supplier performance.

- Previous history of component failures or malfunctions, as reported in

licensee event reports or plant nonconformance reports.
Issue Date: 10/25/06 -9- 88114

! The inspector should include both simple and complex packages in the

sample, as well as packages that include a variety of dedication methods

(e.g., Methods 1 through 4) described above.

! In addition to selecting packages based on the above considerations (safety

significance, complexity, and failures), the inspector should attempt to select

samples from each of the following areas: electrical, instrumentation and

control, mechanical equipment, and materials.

c. Evaluation of Dedication Packages. Perform a detailed review of the dedication

packages, as described above.

d. Evaluation of Training Effectiveness. Experience gained during the procurement

assessments and pilot inspections suggested that training of personnel involved

in CGI dedication activities was a very important factor in the development of a

good CGI dedication program. The CGI dedication process generally requires more

highly qualified/trained personnel than specified in the licensee’s procurement

program requirements . Personnel involved in this process need to be familiar with

current industry and NRC guidance and have a strong interface with the licensee's

design/engineering organizations. The training expectations, however, should not

exceed what is required by the existing licensee's QA program. 

As applicable to their job functions, select and review the training records for

individuals involved in the following areas:

! Determining the safety classification of an item. Training in this area is

appropriate when the job function includes reclassification of items or

establishing safety classification of piece parts of safety-related components.

! Specifying design, material, and performance characteristics relevant to the

safety function and establishing the acceptance criteria for these characteristics.

! Specifying or performing commercial-grade surveys, source verifications, and

tests and inspections, including enhanced post-receipt verification testing or

inspection.

! The preparation and review of procurement documents.

Through observation, interviews, and a review of records of work performed by the

individuals:

! Determine if the individuals selected have adequate knowledge to perform

the specific tasks assigned to them. Attend a training course, if available, or

review the lesson plans for selected training courses.

! Determine if training inadequacies contributed to any of the deficiencies that

may be identified during the inspection.

! Determine if the personnel are familiar with the program requirements and

procedures and if they have been properly trained in the dedication process.

88114-04 INSPECTION RESOURCES

This inspection procedure should be considered for implementation when there is reason

to believe that the failure of an IROFS, or a part thereof, to perform its intended safety
88114 - 10 - Issue Date: 10/25/06

function, was the result of weaknesses in QAI procurement or CGI dedication (reactive

inspection). This inspection procedure may be implemented independently or it may be

used as a supplement to other major team inspections. It is expected that this inspection

should consist of one inspector on site for 16-24 hours. 

88114-05 REFERENCES

The following documents are listed for the inspector's information only and are not

considered regulatory requirements unless the licensee has formally committed to

implementing any of these documents for application to safety-related activities. The

inspector may wish to review these documents to become familiar with commercial grade

dedication issues.

American National Standards Institute, ANSI N45.2-1977, "Quality Assurance Program

Requirements for Nuclear Power Plants," as endorsed by NRC Regulatory Guide 1.28,

Revision 2.

American National Standards Institute, ANSI N45.2.13-1976, "Quality Assurance

Requirements for Control of Procurement of Items and Services for Nuclear Power Plants,"

as endorsed by NRC Regulatory Guide 1.123, Revision 1.

Duke, Cogema, Stone and Webster, “Mixed-Oxide Fuel Fabrication Facility, MOX Project

Quality Assurance Plan (MPQAP)”, Docket Number 070-03098, under US Department of

Energy Contract DE-AC02-99-CH10888, latest revision accepted by NRC.

Duke, Cogema, Stone and Webster, “Mixed-Oxide Fuel Fabrication Facility Construction

Authorization Request”, latest revision accepted by NRC.

Electric Power Research Institute (EPRI) NP-5652, "Guidelines for the Utilization of

Commercial-grade Items in Nuclear Safety-Related Applications (NCIG-07)," as

conditionally endorsed in NRC Generic Letter 89-02.

U.S. Nuclear Regulatory Commission, Generic Letter 89-02, "Actions to Improve the

Detection of Counterfeit and Fraudulently Marketed Products" (microfiche 48960-001).

U.S. Nuclear Regulatory Commission, Generic Letter 91-05, "Licensee Commercial Grade

Procurement and Dedication Programs" (microfiche 57468-264).

END

Appendices:

A. “Dedication Issues”

B. “Definitions”

C. “Contents of Dedication Packages”
Issue Date: 10/25/06 A-1 Appendix A

APPENDIX A

DEDICATION ISSUES

BASIS FOR THE SELECTION AND VERIFICATION OF CRITICAL CHARACTERISTICS

1. Consideration of Item's Safety Function

Critical characteristics of a commercial grade item (CGI) should be based on the

item's safety function. The licensee is responsible for: (a) identifying the important

design, material, and performance characteristics that have a direct effect on the

item's ability to accomplish its intended safety function; and (b) selecting from these

characteristics a set of critical (or acceptance) characteristics that, once verified,

will provide reasonable assurance that the item will perform its intended safety

function. The selection of critical characteristics for verification can be based on

a graded approach, consistent with the item's importance to safety. When an

existing equipment specification is available that contains adequate technical

requirements for the item being purchased, that specification can be used to select

the critical characteristics for this item.

2. Graded Quality Assurance

The application of graded QA to the CGI dedication process should include

consideration of the item's importance to safety and other factors specific to the

item being procured. Certain items and services may require extensive controls

throughout all stages of development, whereas others may require only a limited

QA involvement in selected phases of development. The following factors should

be considered in determining the extent of QA to be applied: (a) The importance

of malfunction or failure of the item to plant safety; (b) the complexity or uniqueness

of the item; (c) the need for special controls and surveillance over process and

equipment; (d) the degree to which functional compliance can be demonstrated by

inspection and test; and (e) the quality history and degree of standardization of the

item. Additional guidance on the use of graded QA can be found in the nonmandatory appendix to American National Standards Institute ANSI N45.2.13-1976.

3. Consideration of Failure Modes

An evaluation of credible failure modes of an item in its operating environment and

the effects of these failure modes on the item's safety function may be used in the

safety classification of an item and as a basis for the selection of critical characteristics.

4. Reasonable Assurance

The dedication process represents an acceptable method of achieving compliance

with the licensee’s U.S. Nuclear Regulatory Commission-approved quality

assurance program, with the purchaser assuming many of the responsibilities for

ensuring quality and functionality of an item that had previously been the vendors

responsibility. In this context, reasonable assurance consists of the purchaser

controlling or verifying the activities affecting the item's quality, to an extent

consistent with the item's importance to safety, or ensuring that these activities are

adequately controlled by the supplier. For more complex items, dialogue with the

original equipment manufacturer may be necessary to identify the design and

functional parameters of specific piece parts. Once the dedication process is

completed, the QA and/or other measures applied to those aspects of the item that
Appendix A A-2 Issue Date: 10/25/06

directly affect its safety function should result in the same level of performance as

for a like item manufactured or purchased under an NRC approved QA program.

5. Engineering Judgment

Engineering judgment can be used in selecting those important design, material,

and performance characteristics that are identified as the item's critical characteristics. The bases for engineering judgment used in the selection process should be

documented.

TRACEABILITY

Material/Items Purchased from Distributors

Traceability can be defined as the ability to verify the history, location, or application of an

item by means of recorded identification. Where the item's acceptance is based entirely

or partially on a certification by the manufacturer, the traceability must extend to the

manufacturer. The purchaser should ensure, by survey or by other means, that the

manufacturer has established adequate traceability controls, and that these controls are

effectively implemented. For situations in which intermediaries (distributors) are included

in the supply chain, the activities of these organizations may need to be surveyed, to ensure

that traceability and proper storage conditions are maintained. A survey of the distributor

may not be necessary if the distributor acts only as a broker and does not warehouse nor

repackage the items, or, in cases where traceability can be established by other means,

such as verification of the manufacturer's markings or shipping records.

SAMPLING

1. Established Heat Traceability (Materials)

When heat traceability of metallic material has been established, and each piece

of the material is identified with the material heat number, chemical analysis and

destructive testing required for the acceptance of this material may be performed

on one piece of the material. The same rationale may be used for the acceptance

of containers of nonmetallic materials, such as lubricants, providing that traceability

has been established and each container is identified with a unique mix or batch

number.

2. Established Lot/Batch Control (Items)

When lot/batch (defined as units of product of a single type, grade, class, size, and

composition, manufactured under essentially the same conditions and at essentially

the same time) control is established through a commercial grade survey, the party

performing dedication of such items can use sampling, prescribed by standard

statistical methods that are based on homogeneous product lots. Such sample

plans should be identified and should provide for the verification of the critical

characteristics with a confidence level consistent with the item's importance to

safety. Other means of demonstrating adequate lot/batch control may include

satisfactory performance history and the results of receipt inspection/testing. When

such methods are used as a basis for developing product sampling strategy, they

should be supported by documented objective evidence.

3. Material and Items with No Lot/Batch Control

When lot/batch control cannot be established, sampling plans need to be

considered on individual, item-specific basis and ensure that they are capable of
Issue Date: 10/25/06 A-3 Appendix A

providing a high level of assurance of the item's suitability for service. There may

be situations where each item needs to be tested. 

COMMERCIAL-GRADE SURVEYS

1. Verification of Vendor's Control of Specific Characteristics

A commercial-grade survey should be specific to the scope of the CGI(s) being

purchased. The vendor's controls of specific critical characteristics to be verified

during the survey should be identified in the survey plan. The verification should

be accomplished by reviewing the vendor's program/procedures controlling these

characteristics and observing the actual implementation of these controls in the

manufacture of items identical to or similar to, the items being purchased.

2. Identification of Applicable Program/Procedures

The vendor must have a documented program and/or procedures to control the

critical characteristics of the item or items being procured that are to be verified

during the survey. When many items are being purchased, a survey of a

representative group of similar items may be sufficient to demonstrate that

adequate controls exist. If the vendor's controls are determined to be satisfactory,

purchase orders for these items should invoke these controls as contract

requirements by referencing the applicable program/procedure(s) and revision. If

multiple working-level procedures are applicable to the vendor's activities, which

affect the item's critical characteristics, and these procedures, in turn, are controlled

by a higher-level document, it may be appropriate to reference that document in

the purchase order. It is important to ensure that the specific controls reviewed and

accepted during the survey be applied during the manufacturing process. On

completion of the work, the vendor should certify compliance with the purchase

order requirements.

3. Documentation of Survey Results

Commercial-grade survey documentation should include: (1) The identification of

the item or items for which the vendor is being surveyed; (2) identification of the

critical characteristics of these items that the vendor is expected to control; (3)

identification of the controls to be applied (program/procedure and revision); and

(4) a description of the verification activities performed and results obtained. Critical

characteristics that are not adequately controlled should be addressed by

contractually requiring the vendor to institute additional controls or by using other

verification and acceptance methods.

4. Survey Frequency

Commercial-grade surveys should be conducted at sufficient frequency to ensure

that the process controls applicable to the critical characteristics of the item

procured continue to be effectively implemented. Factors to be considered in

determining the frequency of commercial-grade surveys include the complexity of

the item, frequency of procurement, receipt inspection, item-performance history,

and knowledge of changes in the vendor's controls. 

ACCEPTANCE OF CERTIFIED MATERIAL TEST REPORTS (CMTRs) AND CERTIFICATES OF COMPLIANCE (CoCs)

Validity Verified Through Vendor/Supplier Audit or Testing

When the verification of critical characteristics is based on vendor CMTRs or CoCs, the

validity of these documents should be ensured. This can be accomplished through a

commercial-grade survey or, for simple items, periodic testing of the product, on receipt.
Appendix A A-4 Issue Date: 10/25/06

Such verifications should be conducted at intervals commensurate with the vendor's past

performance. If the item's supply chain includes a distributor, a survey of the distributor's

activities may be necessary (see "Traceability").

USE OF INDUSTRY GUIDANCE

The Electric Power Research Institute (EPRI) NP-5652, "Guideline for the Utilization of

Commercial Grade Items in Nuclear Safety Related Applications (NCIG-07)," defines critical

characteristics as... "identifiable and measurable attributes/variables of a CGI, which once

selected to be verified, provide reasonable assurance that the item received is the item

specified." NRC's conditional endorsement of EPRI NP-5652, by Generic Letter 89-02, was

based on interpreting that, in the EPRI definition of critical characteristics, the "item

specified" encompassed those attributes that are essential for the performance of the item's

safety function. This interpretation is consistent with the definition of "critical characteristics

for acceptance" found in EPRI NP-6406, "Guidelines for the Technical Evaluation of

Replacement Items in Nuclear Power Plants," which notes that critical characteristics for

acceptance are a subset of "critical characteristics for design." The EPRI NP-6406

definition of "critical characteristics for design" includes those attributes that ensure the

performance of the item's design function.

Published NRC guidance does not differentiate between design and acceptance critical

characteristics, and the CGI dedication guidance provided in Generic Letters 89-02 and 91-

05 does not suggest that all design requirements of an item need to be verified during the

dedication process. Rather, the licensee is expected to identify the item's design, material,

and performance characteristics that have a direct effect on the item's ability to accomplish

its intended safety function, and select, from these characteristics a set of critical (or

acceptance) characteristics that, once verified, will provide reasonable assurance that the

item will perform that function. Consistency in the definition of critical characteristics can

be improved by equating NRC's definition of critical characteristics to the EPRI definition

of "critical characteristics for acceptance."

END
Issue Date: 10/25/06 B-1 Appendix B

APPENDIX B

DEFINITIONS

The following terms are listed to provide the inspectors with working definitions of important

terms used during the procurement and dedication of commercial-grade items (CGIs).

These terms are defined only in the context of the CGI dedication process and are solely

to aid the inspector in the inspection process.

Basic Component - A plant structure, system, component, or part thereof necessary to

ensure one of the following:

! The integrity of the reactor coolant pressure boundary

! Capability to shut down the reactor and maintain it in a safe shutdown condition; and

! The capability to prevent or mitigate the consequences of accidents that could result in

offsite radiation exposures comparable to those referred to in 10 CFR 100.11.

Basic components are items designed and manufactured under a U.S. Nuclear Regulatory

Commission-approved quality assurance program, or CGIs that have successfully

completed the dedication process. (See definition in 10 CFR 21.3.)

Certificate of Compliance - A document attesting that the materials are in accordance with

specified requirements.

Certified Material Test Report - A document attesting that the material is in accordance with

specified requirements, including the actual results of all required chemical analyses, tests,

and examinations.

Commercial Grade Item (CGI) - A CGI means a structure, system, or component, or part

thereof, that affects its safety function, which was not designed nor manufactured as a basic

component. CGIs do not include items that have one or more critical characteristics that

cannot be verified by one or more acceptance methods (see definition in 10 CFR 21.3).

Commercial-Grade Survey - Activities conducted, by the purchaser or its agent, to verify,

that a supplier of CGI controls, through quality activities, the critical characteristics of

specifically designated CGIs, as a method to accept those characteristics, only without

further dedication for safety-related use.

Critical Characteristics - Those important design, material, and performance characteristics

that, once verified, will provide reasonable assurance that the item will perform its intended

safety function.

Dedication - An acceptance process undertaken to provide reasonable assurance that a

CGI to be used as a basic component will perform its intended safety function. This process

includes the identification of critical characteristics and their verifications by one or more

of the dedication methods. (See definition in 10 CFR 21.3.)

Dedicating Entity - The organization that performs the dedication activity. Dedication may

be performed by the manufacturer, a third-party dedicating entity, or the licensee itself.

(See definition in 10 CFR 21.3)

Engineering Judgment - A process of logical reasoning that leads from stated premises to

a conclusion. This process should be supported by sufficient documentation to permit

verification by a qualified individual.
Appendix B B-2 Issue Date: 10/25/06

Source Verification - Activities witnessed at the supplier's facilities, by the purchaser or its

agent, for specific items, to verify that a supplier of CGIs controls the critical characteristics

of that item as a method to accept those characteristics, only without further dedication for

safety-related use.

Traceability - Is the ability to verify the history, location, or application of an item, by means

of recorded identification.

END
Issue Date: 10/25/06 C-1 Appendix C

APPENDIX C

CONTENTS OF DEDICATION PACKAGES

The dedication packages compiled by the licensee may contain the following items, as

applicable, depending on the item chosen and the dedication methods used.

! Purchase requisitions and purchase orders.

! Other pertinent vendor/licensee correspondence.

! Design specifications - -original and updated - - to verify certain important parameters,

such as original design pressure of a system or degraded pickup voltage of a solenoid

or relay.

! Catalog specifications.

! Procurement basis evaluation - like-for-like, equivalency, plant-design change packages,

drawing and specification updates.

! 10 CFR 70.72 safety evaluation, if required.

! Material-receiving reports, packing lists/invoices, and other shipping documents.

! Receipt-inspection reports and any related test reports.

! Other documents to trace the item from the time it was dedicated to the time it was

installed, tested, and accepted.

! Certificates of conformance/compliance/quality.

! Vendor test and inspection reports.

! Third-party or sub-vendor test and inspection reports.

! Shelf-life information.

! Vendor-dedication/partial-dedication information.

! Design/material/process change-history information.

! Completed commercial-grade dedication document, including:

S Safety classification,

S Identification of safety functions/application requirements,

S Identification of critical characteristics,

S Identification of verification methods and acceptance criteria for the critical

characteristics,

S Evaluation of credible failure modes (if applicable), and

S Identification of the supplier’s quality assurance program that meets the licensee’s U.S.

Nuclear Regulatory Commission-approved quality assurance program.
Appendix C C-2 Issue Date: 10/25/06

! Any deviation from design, material, and performance characteristics relevant to the safety

function (nonconformance dispositions).

! Documents showing objective evidence:

- Special test and inspection procedures and results

- Commercial-grade survey reports - item, design, material, and specific performance

characteristic (relevant to safety function), and

- Source inspection reports.

! Completed post-installation test procedure and results.

! Completed stock, or material-issue forms and installation work orders or reports.

! Historical performance information.

END
Issue Date: 10/25/06 IP 88114, Att 1 Att 1-1

ATTACHMENT 1

Revision History for IP 88114

CommitmentTrackingNumber

Issue Date Description of Change Training

Needed

TrainingCompletionDate

Comment Resolution Accession Number

10/25/06CN 06-031 06-NMSS

IP 88114 is a newly issued procedure. Issued for MOX inspection program toimprove effectiveness and efficiency byincorporating and consolidating inspection requirements involving commercialgrade dedication and 10 CFR Part 21inspection.

None N/A