I

103D CONGRESS

1ST SESSION H. R. 2359

To amend the Nuclear Non-Proliferation Act of 1978 and the Atomic Energy

Act of 1954 to improve the organization and management of United

States nuclear export controls, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JUNE 9, 1993

Mr. LANTOS introduced the following bill; which was referred jointly to the

Committees on Foreign Affairs and Banking, Finance and Urban Affairs

A BILL

To amend the Nuclear Non-Proliferation Act of 1978 and

the Atomic Energy Act of 1954 to improve the organization and management of United States nuclear export

controls, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Nuclear Export Reor5 ganization Act of 1993’’.

6 SEC. 2. TABLE OF CONTENTS.

7 The table of contents for this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

Sec. 3. Definitions.
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Sec. 4. Findings and Policy.

TITLE I—AMENDMENTS TO THE NUCLEAR NON-PROLIFERATION

ACT OF 1978

Sec. 101. Reports of the President.

Sec. 102. Export controls over nuclear dual-use items.

Sec. 103. Non-nuclear energy resources.

TITLE II—INITIATIVES TO STRENGTHEN COMPLIANCE

Sec. 201. Fair market initiative.

Sec. 202. Measures to improve the licensing process.

TITLE III—AMENDMENTS TO THE ATOMIC ENERGY ACT OF 1954

Sec. 301. Subsequent arrangements.

Sec. 302. Cooperation with other nations.

Sec. 303. Prohibition on foreign production of special nuclear material.

Sec. 304. Prohibition on nuclear exports.

Sec. 305. Control of component parts.

TITLE IV—SANCTIONS FOR NUCLEAR PROLIFERATION

Sec. 401. Imposition of sanctions.

Sec. 402. Eligibility for assistance.

Sec. 403. Role of international financial institutions.

Sec. 404. Amendment to the International Emergency Economic Powers Act.

Sec. 405. Amendment to the Federal Deposit Insurance Corporation Improvement Act of 1991.

Sec. 406. Export-Import Bank of the United States.

Sec. 407. Additional amendments to the Foreign Assistance Act of 1961.

Sec. 408. Reward.

Sec. 409. Reports.

Sec. 410. Technical correction.

TITLE V—INTERNATIONAL ATOMIC ENERGY AGENCY

Sec. 501. Bilateral and multilateral initiatives.

Sec. 502. Reforms in IAEA safeguards.

Sec. 503. Reporting requirement.

TITLE VI—REVIEW OF PLUTONIUM USE POLICY

Sec. 601. Findings and declarations.

Sec. 602. Report.

1 SEC. 3. DEFINITIONS.

2 For purposes of this Act—

3 (1) the term ‘‘direct-use material’’ means nu4 clear material that can be used for the manufacture

5 of nuclear explosive components without transmuta-
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1 tion or further enrichment, such as plutonium con2 taining less than 80 percent plutonium-238, ura3 nium enriched to 20 percent uranium-235 or more,

4 uranium-233, and chemical compounds, mixtures of

5 direct-use materials (including mixed oxide reactor

6 fuel), and plutonium contained in spent nuclear fuel;

7 (2) the term ‘‘goods or technology’’ means nu8 clear materials and equipment and sensitive nuclear

9 technology (as such terms are defined in section 4

10 of the Nuclear Non-Proliferation Act of 1978), all

11 export items designated pursuant to section 309(c)

12 of the Nuclear Non-Proliferation Act of 1978, and

13 all technical assistance requiring authorization under

14 section 57b. of the Atomic Energy Act of 1954;

15 (3) the term ‘‘highly enriched uranium’’ means

16 uranium enriched to 20 percent or more in the iso17 tope U–235;

18 (4) the term ‘‘IAEA’’ means the International

19 Atomic Energy Agency;

20 (5) the term ‘‘IAEA safeguards’’ means the

21 safeguards set forth in an agreement between a

22 country and the International Atomic Energy Agen23 cy, as authorized by Article III(A)(5) of the Statute

24 of the International Atomic Energy Agency;
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1 (6) the term ‘‘near real time material account2 ancy’’ means a method of accounting for the loca3 tion, quantity, and disposition of special fissionable

4 material at facilities that store or process such mate5 rial, in which verification of peaceful use is continu6 ously achieved by means of frequent physical inven7 tories and the use of in-process instrumentation;

8 (7) the term ‘‘non-nuclear-weapon state’’ means

9 any country which is not a nuclear-weapon state, as

10 defined by Article IX(3) of the Treaty on the Non11 Proliferation of Nuclear Weapons, signed at Wash12 ington, London, and Moscow on July 1, 1968;

13 (8) the term ‘‘nuclear dual-use items’’ means all

14 goods and technologies whose export from the Unit15 ed States is controlled pursuant to sections 309(c)

16 and 311 of the Nuclear Non-Proliferation Act of

17 1978;

18 (9) the term ‘‘nuclear explosive device’’ means

19 any device, whether assembled or disassembled, that

20 is designed to release in one microsecond or less an

21 amount of nuclear energy from special nuclear mate22 rial that is greater than the amount of energy that

23 would be released from the detonation of one pound

24 of trinitrotoluene (TNT);
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1 (10) the term ‘‘special fissionable material’’, as

2 used in title III of this Act, has the meaning given

3 that term by Article XX(1) of the Statute of the

4 International Atomic Energy Agency, done at the

5 Headquarters of the United Nations on October 26,

6 1956;

7 (11) the term ‘‘special nuclear material’’ has

8 the meaning given that term in section 11 aa. of the

9 Atomic Energy Act of 1954 (42 U.S.C. 2014aa);

10 (12) the term ‘‘Treaty’’ means the Treaty on

11 the Non-Proliferation of Nuclear Weapons, signed at

12 Washington, London, and Moscow on July 1, 1968;

13 and

14 (13) the term ‘‘unsafeguarded special nuclear

15 material’’ means special nuclear material which is

16 held in violation of IAEA safeguards or is not sub17 ject to IAEA safeguards, and does not include any

18 quantity of material that could, if it were exported

19 from the United States, be exported under a general

20 license issued by the Nuclear Regulatory Commis21 sion.

22 SEC. 4. FINDINGS AND POLICY.

23 (a) FINDINGS.—The Congress finds that—
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1 (1) the proliferation of nuclear explosive devices

2 poses a serious and growing threat to the national

3 security of the United States;

4 (2) any effective response to this threat should

5 include measures to curb both the demand for and

6 the supply of goods and technology to acquire such

7 devices;

8 (3) non-nuclear-weapon states with clandestine

9 programs for the manufacture of nuclear explosive

10 devices continue to seek foreign sources of goods and

11 technologies that are important to the success of

12 such programs;

13 (4) export controls, especially when coordinated

14 internationally, inhibit such programs by adding to

15 the costs of acquiring alternative sources of re16 stricted goods and technologies and by delaying the

17 implementation of such programs;

18 (5) the implementation of export controls gen19 erates information that is useful in assessing the ef20 forts by importing nations to acquire capabilities to

21 develop or produce such devices and that provides an

22 early warning of illicit foreign procurement patterns;

23 (6) a renewed effort is needed to improve con24 trols over nuclear dual-use items; and
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1 (7) the economy and effectiveness of the execu2 tive branch of Government, and the effectiveness of

3 congressional oversight, require the reorganization

4 and centralization of certain export licensing func5 tions of the Government in a single agency to which

6 all persons and commercial interests seeking to en7 gage in foreign commerce may apply.

8 (b) POLICY.—It is the policy of the United States—

9 (1) to restrict the export or reexport of goods

10 or technology that would be contrary to the objec11 tives of the United States with respect to the non12 proliferation of nuclear explosive devices;

13 (2) to strengthen sanctions against illicit suppli14 ers of nuclear goods or technology;

15 (3) to ensure that significant national security

16 interests will prevail over commercial considerations

17 in the event of any conflict in the nuclear export li18 censing process between these national objectives;

19 (4) to cooperate with other nations to develop

20 multilateral measures to halt the global proliferation

21 of nuclear explosive devices;

22 (5) to encourage individuals and companies to

23 develop voluntary measures to ensure that goods or

24 technology will not be exported that would promote

25 the global proliferation of nuclear explosive devices;
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1 (6) to ensure greater openness and accountabil2 ity in the nuclear export licensing process; and

3 (7) to undertake reforms devoted to improving

4 the efficiency and effectiveness of the nuclear export

5 licensing process.

6 TITLE I—AMENDMENTS TO THE

7 NUCLEAR NON-PROLIFERA8 TION ACT OF 1978

9 SEC. 101. REPORTS OF THE PRESIDENT.

10 Section 601(a) of the Nuclear Non-Proliferation Act

11 of 1978 (22 U.S.C. 3281(a)) is amended—

12 (1) in paragraph (4), by striking ‘‘and’’ after

13 the semicolon;

14 (2) in paragraph (5), by striking the period and

15 inserting ‘‘; and’’; and

16 (3) by adding after paragraph (5) the following

17 new paragraph:

18 ‘‘(6) a description of the implementation of nu19 clear export controls in the preceding calendar year,

20 including a summary by type of commodity, by value

21 per type of commodity, and by destination, of—

22 ‘‘(A) any transactions for which—

23 ‘‘(i) a license was issued for the ex24 port or retransfer of any good controlled
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1 under section 309(c) or 311 of the Nuclear

2 Non-Proliferation Act of 1978;

3 ‘‘(ii) a license was issued for the ex4 port or retransfer of any good controlled

5 under section 109 b. of the 1954 Act; and

6 ‘‘(iii) an authorization was made as

7 required by section 57 b.(2) of the 1954

8 Act to engage, directly or indirectly, in the

9 production of special nuclear material; and

10 ‘‘(B) each instance in which—

11 ‘‘(i) a sanction has been imposed

12 under section 401(a) of the Nuclear Ex13 port Reorganization Act of 1993, section

14 670(b)(1) of the Foreign Assistance Act of

15 1961, or section 601 or 602 of the Federal

16 Deposit Insurance Corporation Improve17 ment Act of 1991;

18 ‘‘(ii) a sale or lease has been denied

19 under section 3(f) of the Arms Export

20 Control Act or a transaction prohibited by

21 reason of any act relating to proliferation

22 of nuclear explosive devices, as described in

23 section 40(d) of that Act;

24 ‘‘(iii) a sanction has not been imposed

25 by reason of section 401(c)(2) of the Nu-
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1 clear Export Reorganization Act of 1993

2 or the imposition of a sanction has been

3 delayed under section 670(b)(4) of the

4 Foreign Assistance Act of 1961; or

5 ‘‘(iv) a waiver of a sanction has been

6 made under—

7 ‘‘(I) section 401(f) of the Nuclear

8 Export Reorganization Act of 1993,

9 ‘‘(II) section 620E(d), or para10 graph (5) or (6) of section 670(b), of

11 the Foreign Assistance Act of 1961,

12 ‘‘(III) section 605 of the Federal

13 Deposit Insurance Corporation Im14 provement Act of 1991,

15 ‘‘(IV) section 40(g) of the Arms

16 Export Control Act with respect to

17 the last sentence of section 40(d) of

18 that Act, or

19 ‘‘(V) section 614 of the Foreign

20 Assistance Act of 1961 with respect to

21 section 620E or 670(b)(1) of that Act

22 or section 3(f), or the last sentence of

23 section 40(d), of the Arms Export

24 Control Act.’’.
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1 SEC. 102. EXPORT CONTROLS OVER NUCLEAR DUAL-USE

2 ITEMS.

3 (a) AMENDMENT TO THE NATIONAL SECURITY ACT

4 OF 1947.—Section 101 of the National Security Act of

5 1947 (50 U.S.C. 402) is amended by adding at the end

6 thereof the following new subsection:

7 ‘‘(h)(1) The President shall establish within the Na8 tional Security Council a ‘Subgroup on Nuclear Export

9 Coordination’. The principal function of the Subgroup

10 shall be to implement the export controls required by sec11 tions 309(c) and 311 of the Nuclear Non-Proliferation Act

12 of 1978 (Public Law 95–242).

13 ‘‘(2) There are authorized to be appropriated to the

14 Subgroup such sums as may be necessary to carry out the

15 functions of the Subgroup under title III of the Nuclear

16 Non-Proliferation Act of 1978.’’.

17 (b) AMENDMENT TO THE NUCLEAR NON-PRO18 LIFERATION ACT OF 1978.—Title III of the Nuclear Non19 Proliferation Act of 1978 is amended by adding at the

20 end thereof the following new sections:

21 ‘‘SEC. 310. SUBGROUP ON NUCLEAR EXPORT COORDINA22 TION.

23 ‘‘(a) COMPOSITION OF THE SUBGROUP.—(1) The

24 Subgroup on Nuclear Export Coordination (hereafter in

25 this title referred to as the ‘Subgroup’), established in sec26 tion 101(h) of the National Security Act of 1947, shall
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1 be composed of six members who shall be Government offi2 cials having expertise in the control of exports and the

3 non-proliferation of nuclear explosive devices. Each such

4 member shall be designated by the head of one of the fol5 lowing United States agencies from among officials of that

6 agency, with no agency represented by more than one

7 member:

8 ‘‘(A) The Department of State.

9 ‘‘(B) The Department of Defense.

10 ‘‘(C) The Department of Energy.

11 ‘‘(D) The Department of Commerce.

12 ‘‘(E) The Arms Control and Disarmament

13 Agency.

14 ‘‘(F) The Nuclear Regulatory Commission.

15 ‘‘(2) The representative of the Arms Control and Dis16 armament Agency shall serve as Chairman of the Sub17 group.

18 ‘‘(3) Upon request of the Chairman of the Subgroup,

19 other departments and agencies of the United States, in20 cluding elements of the intelligence community, the De21 partment of Treasury, the United States Customs Service,

22 and the Federal Bureau of Investigation, shall detail per23 sonnel to the Subgroup for the performance of duties on

24 a temporary basis.

25 ‘‘(b) FUNCTIONS.—The Subgroup shall—
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1 ‘‘(1) serve as a forum for identifying and ex2 pressing the views of the constituent agencies with

3 respect to—

4 ‘‘(A) the proliferation risks associated with

5 the export of nuclear dual-use items;

6 ‘‘(B) possible international initiatives to

7 strengthen the global administration and en8 forcement of controls over the export of such

9 items; and

10 ‘‘(C) recommendations to the President on

11 regulatory and legislative measures to improve

12 the efficiency or effectiveness of export controls

13 over such items, including the verification of

14 peaceful end-uses and the design and execution

15 of improved post-export verification measures;

16 ‘‘(2) review applications for the export of nu17 clear dual-use items in accordance with sections

18 309(c) and 311;

19 ‘‘(3) designate the items for inclusion on the

20 Nuclear Referral List established under section

21 311(a) and shall determine their description and

22 technical specifications;

23 ‘‘(4) monitor and facilitate the interagency

24 process with respect to the nuclear export licensing

25 activities described in this Act or in the Atomic En-
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1 ergy Act of 1954, and in regulations issued pursuant

2 to such Acts; and

3 ‘‘(5) undertake investigations and make rec4 ommendations in accordance with section 201 of the

5 Nuclear Export Reorganization Act of 1993.

6 ‘‘(c) ACCESS TO EXPORT LICENSING INFORMA7 TION.—Notwithstanding any other provision of law—

8 ‘‘(1) the members of the Subgroup shall have

9 full, timely, and equal access to information con10 tained in applications for the export from the United

11 States, or the reexport from any other country, of

12 any nuclear dual-use item;

13 ‘‘(2) the Secretary of Commerce shall, upon re14 quest by any member of the Subgroup, provide that

15 member with information contained in applications

16 for licenses to export any other item from the Unit17 ed States, if that member requests such information

18 for purposes relating to the objectives of this Act;

19 and

20 ‘‘(3) the Secretary of Commerce shall, within

21 six months after the issuance of a license to export

22 any nuclear dual-use item from the United States,

23 open to the public for examination and inspection all

24 nonproprietary data pertaining to such license, in25 cluding—
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1 ‘‘(A) the commodity description,

2 ‘‘(B) the country destination,

3 ‘‘(C) the end-use and end-user,

4 ‘‘(D) the quantity,

5 ‘‘(E) the date of approval, and

6 ‘‘(F) the date and method of shipment,

7 if no names of persons or companies and no dollar

8 values of commodities in individual licenses are in9 cluded among this data.

10 ‘‘(d) EXPORT CONTROL BULLETIN.—(1) The Chair11 man of the Subgroup shall, in consultation with the Sub12 group, establish and publish an export control bulletin on

13 issues relating to the proliferation of nuclear explosive de14 vices, including regulations, international agreements, and

15 other relevant developments that the Chairman determines

16 may be necessary for the purpose of informing exporters

17 and the general public about the risks of proliferation and

18 efforts to reduce or eliminate such risks.

19 ‘‘(2) Information appearing in the bulletin shall con20 stitute one, but not an exclusive, basis for satisfaction of

21 the criterion of ‘requisite knowledge’ in section 401(a) of

22 the Nuclear Export Reorganization Act of 1993 and in

23 section 601(a) of the Federal Deposit Insurance Corpora24 tion Improvement Act of 1991, and the criterion of ‘knows

25 or has reason to know’ in section 311(b)(3) of this Act.
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1 ‘‘SEC. 311. LICENSING PROCESS.

2 ‘‘(a) CONTROLLED ITEMS.—(1)(A) The President

3 shall establish and maintain a list of items, designated by

4 the Subgroup, whose export is controlled pursuant to sec5 tion 309(c). Such list may be known as the ‘Nuclear Re6 ferral List’.

7 ‘‘(B) The President shall cause the Nuclear Referral

8 List and any modification thereof to be published in the

9 Federal Register.

10 ‘‘(C) Except as otherwise provided under section

11 202(b) of the Nuclear Export Reorganization Act of 1993,

12 an individual validated license is required for the export

13 from the United States of any item on the Nuclear Refer14 ral List.

15 ‘‘(2) For purposes of this section, any item that—

16 ‘‘(A) is not on the Nuclear Referral List,

17 ‘‘(B) requires a validated export license for na18 tional security reasons, and

19 ‘‘(C) is intended for a nuclear-related end-use

20 or end-user,

21 shall be subject to the procedures established under this

22 title which are otherwise applicable to items on the Nu23 clear Referral List.

24 ‘‘(3)(A) An individual validated license is required for

25 an export to any destination of any technical data or com26 modity where the exporter knows or has reason to know
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1 that the data or commodity will be used directly or indi2 rectly in any of the following activities, whether or not the

3 item is specifically designed or modified for such activities:

4 ‘‘(i) Designing, developing, fabricating, or test5 ing any nuclear explosive device.

6 ‘‘(ii) Designing, constructing, fabricating, or op7 erating any of the following facilities, or components

8 for such facilities:

9 ‘‘(I) Facilities for the chemical processing

10 of irradiated special nuclear or source material.

11 ‘‘(II) Facilities for the production of heavy

12 water.

13 ‘‘(III) Facilities for the separation of iso14 topes of source and special nuclear material.

15 ‘‘(IV) Facilities for the fabrication of nu16 clear reactor fuel containing plutonium or high17 ly enriched uranium.

18 ‘‘(V) Unsafeguarded nuclear fuel cycle fa19 cilities.

20 ‘‘(B) An item is used indirectly in an activity de21 scribed in subparagraph (A)—

22 ‘‘(i) if any United States agency notifies an ex23 porter of the risk of any such use; or

24 ‘‘(ii) the item would materially assist the per25 formance of any such activity.
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1 ‘‘(b) AUTHORITY OF THE SECRETARY OF COM2 MERCE.—Except as otherwise provided in this section, the

3 Secretary of Commerce shall be responsible for—

4 ‘‘(1) processing all applications for validated li5 censes for the export of all nuclear dual-use items

6 requiring such a license before the export from the

7 United States or the reexport from any other coun8 try of any such items; and

9 ‘‘(2) record keeping with respect to the ap10 proval or denial of such licenses or authorizations.

11 ‘‘(c) LICENSE APPROVALS AND DENIALS.—(1)

12 Whenever the Secretary of Commerce receives an applica13 tion for a validated license for the export from the United

14 States of any nuclear dual-use item, the Secretary shall

15 submit the application to the Subgroup for review as to

16 whether—

17 ‘‘(A) approval of such export would be contrary

18 to the objective of averting the proliferation of nu19 clear explosive devices; or

20 ‘‘(B) the proposed export would pose an unac21 ceptable risk of diversion to a nuclear explosive ac22 tivity or to an unsafeguarded nuclear fuel cycle.

23 ‘‘(2) The Secretary shall issue no license for the ex24 port of any nuclear dual-use item without the concurrence
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1 of all members of the Subgroup that each of the review

2 criteria of paragraph (1) has been fully satisfied.

3 ‘‘(3) In performing the reviews required by paragraph

4 (1), the members of the Subgroup shall include the follow5 ing factors among the considerations used to determine

6 what action should be taken on individual applications:

7 ‘‘(A) The stated end-use of the commodity or

8 technical data.

9 ‘‘(B) The significance for nuclear purposes of

10 the particular commodity or technical data.

11 ‘‘(C) The availability of the commodity or tech12 nical data from non-United States sources.

13 ‘‘(D) The types of assurances or guarantees

14 against use for nuclear explosive purposes or pro15 liferation given in the particular case.

16 ‘‘(E) The non-proliferation credentials of the

17 importing country concerned, based on consideration

18 of factors such as—

19 ‘‘(i) a country’s status as a party to the

20 Treaty on the Non-Proliferation of Nuclear

21 Weapons or the Treaty for the Prohibition of

22 Nuclear Weapons in Latin America;

23 ‘‘(ii) whether the country has all its nu24 clear activities under International Atomic En-
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1 ergy Agency safeguards or equivalent full scope

2 safeguards;

3 ‘‘(iii) whether there is an agreement for co4 operation in the civil uses of atomic energy be5 tween the United States and the country con6 cerned;

7 ‘‘(iv) the country’s public statements and

8 policies concerning nuclear developments and

9 non-proliferation;

10 ‘‘(v) the extent of cooperation in non-pro11 liferation policy generally (indications such as

12 willingness to consult on international non-pro13 liferation issues); and

14 ‘‘(vi) intelligence data on a country’s nu15 clear intentions and activities, including wheth16 er the country has engaged in clandestine or il17 legal procurement activities, whether similar li18 censes have previously been denied by any other

19 country, and whether end users in the recipient

20 country have diverted, for purposes inconsistent

21 with this section, any nuclear goods or tech22 nology, under an export, retransfer, or other ac23 tivity previously authorized by any country.
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1 ‘‘(d) PROCEDURES AND APPEALS.—(1) Applications

2 for the export of nuclear dual-use items shall be made to

3 the Department of Commerce.

4 ‘‘(2)(A) Upon receipt of any such application, the

5 Secretary of Commerce shall promptly refer the applica6 tion to the Subgroup.

7 ‘‘(B) Not later than 90 days after receipt of an appli8 cation from the Secretary, the Subgroup shall complete

9 its review of that application in accordance with subsection

10 (c)(1) and shall report to the Secretary its determination

11 regarding the application of that subsection.

12 ‘‘(3) If the Subgroup has not taken action on an ap13 plication by 90 days after receipt of that application, the

14 applicant may file a petition with the Secretary of Com15 merce requesting compliance with the requirements of this

16 section. Whenever such a petition is filed, the Secretary

17 shall take immediate steps to correct the situation giving

18 rise to the petition and shall immediately notify the appli19 cant of such steps.

20 ‘‘(4) If, within 20 days after a petition is filed under

21 paragraph (3), the processing of the application does not

22 meet the requirements of this section, or the application

23 meets such requirements but the Secretary has not so no24 tified the applicant, then the applicant may bring an ac25 tion in an appropriate United States district court for a
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1 restraining order, a temporary or permanent injunction,

2 or other appropriate relief, to require compliance with the

3 requirements of this section. The United States district

4 courts shall have jurisdiction to provide such relief, as ap5 propriate.

6 ‘‘(5)(A)(i) Any constituent agency of the Subgroup

7 may appeal the denial of a license under this section to

8 the President and, if the President determines that the

9 license should be approved, the President shall direct the

10 Secretary of Commerce to issue such license.

11 ‘‘(ii) The Secretary of Commerce shall report to the

12 Congress on data from such licenses in accordance with

13 section 602(c) of the Nuclear Non-Proliferation Act of

14 1978.

15 ‘‘(B) The procedures of this paragraph shall be the

16 exclusive means of appeal for denials of licenses issued

17 under this section.

18 ‘‘(C) Documentation describing and supporting the

19 agency’s position shall be submitted to the President as

20 part of any appeal.

21 ‘‘(D) The President shall prescribe such regulations

22 as may be necessary to carry out this paragraph.’’.

23 SEC. 103. NON-NUCLEAR ENERGY RESOURCES.

24 Title V of the Nuclear Non-Proliferation Act of 1978

25 is amended—
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1 (1) in section 501, by inserting ‘‘(a)’’ imme2 diately after ‘‘SEC. 501.’’;

3 (2) by adding at the end of section 501 the fol4 lowing:

5 ‘‘(b)(1) The Congress declares that it is both in the

6 national security and economic interests of the United

7 States to promote the development in the United States

8 of a domestic industry capable of competing on inter9 national markets for the sale of energy technologies capa10 ble of achieving the objectives of section 501(a).

11 ‘‘(2) The Congress urges the President to pursue all

12 appropriate means to encourage the development of such

13 an industry in the United States and otherwise to assist

14 developing countries to acquire such technologies.’’; and

15 (3) by adding at the end of the title the follow16 ing new section:

17 ‘‘SEC. 504. REVIEW OF RESEARCH AND DEVELOP18 MENT.—Not later than 6 months after the date of enact19 ment of the Nuclear Export Reorganization Act of 1993,

20 the President shall undertake a review of all federally

21 funded research and development consistent with the ob22 jectives of section 501 and shall report to the Congress

23 on the adequacy of such activities to achieve such objec24 tives.’’.
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1 TITLE II—INITIATIVES TO

2 STRENGTHEN COMPLIANCE

3 SEC. 201. FAIR MARKET INITIATIVE.

4 (a) PETITION FOR INVESTIGATION.—Any United

5 States person that finds that a foreign person has, on or

6 after the date of enactment of this Act, engaged in an

7 activity outside the United States that is inconsistent with

8 the guidelines adopted by the United States and other

9 member countries of the Nuclear Suppliers Group with re10 spect to exports of nuclear dual-use items, or successor

11 guidelines adopted by such countries, may petition the

12 Subgroup on Nuclear Export Coordination to begin an in13 vestigation of such activities.

14 (b) DETERMINATION BY SUBGROUP.—Within 30

15 days of the date of receipt of any such petition, the Sub16 group shall determine whether to undertake an investiga17 tion.

18 (c) RECOMMENDATION REGARDING SANCTIONS.—If

19 the Subgroup undertakes an investigation and determines

20 that the claims of the petitioner are sustained by available

21 evidence, the Chairman of the Subgroup shall transmit a

22 determination to that effect to the President, together

23 with the specific recommendation of the Subgroup as to

24 the imposition of the appropriate sanctions under title IV

25 of this Act or under the amendments made by that title.
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1 (d) PUBLICATION IN THE FEDERAL REGISTER.—If

2 the President does not disapprove such determination

3 within a period of 30 days after receipt of such determina4 tion, the Chairman shall publish such determination in the

5 Federal Register and the sanctions shall take effect.

6 SEC. 202. MEASURES TO IMPROVE THE LICENSING PROC7 ESS.

8 (a) GUIDELINES FOR VOLUNTARY CODES OF CON9 DUCT.—(1) Within 6 months after the date of enactment

10 of this Act, the Subgroup shall develop guidelines to serve

11 as a basis for the adoption of voluntary codes of conduct

12 by companies that engage in exports of nuclear dual-use

13 items.

14 (2) The Chairman shall publish in the Federal Reg15 ister such guidelines and the names of all companies that

16 have agreed to adopt such codes of conduct.

17 (b) REVIEW OF TYPES OF LICENSES.—(1) The Sub18 group shall undertake a comprehensive review of the cir19 cumstances under which certain nuclear dual-use goods

20 could be exported under licenses other than an individual

21 validated license, without jeopardizing the national secu22 rity, national interest, or nonproliferation objectives of the

23 United States.
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1 (2) The Secretary of Commerce may, with the con2 currence of the Subgroup, issue any such license identified

3 in paragraph (1).

4 (3) The Secretary of Commerce shall report to the

5 Congress on data from such licenses in accordance with

6 section 602(c) of the Nuclear Non-Proliferation Act of

7 1978.

8 (c) ADVISORY OPINIONS.—(1) Upon the request of

9 any person, the Subgroup may, after appropriate consulta10 tion, issue an advisory opinion in writing to that person

11 as to whether a proposed activity by that person would

12 subject that person to sanctions under existing nuclear ex13 port control laws.

14 (2) Issuance of an advisory opinion under paragraph

15 (1) shall not exempt any person from compliance with the

16 requirements of this Act.

17 (3) For purposes of this subsection, the term ‘‘appro18 priate consultation’’ means consultation by the Subgroup

19 with the Secretary of State, the Secretary of Defense, the

20 Director of the Arms Control and Disarmament Agency,

21 and the heads of such other Federal agencies as the Sub22 group may determine are necessary.

23 (d) PROCEDURES TO EXPEDITE LICENSE APPROV24 ALS.—The Subgroup may develop and implement proce25 dures to expedite the approvals of licenses for nuclear
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1 dual-use items to be exported to countries that the Sub2 group has determined are not engaged, and are unlikely

3 to become engaged, in promoting, directly or indirectly,

4 the proliferation of nuclear explosive devices if no such

5 procedures would eliminate the fundamental requirement

6 of licensing of goods or technology that are controlled be7 cause of their association with the development, acquisi8 tion, or use of nuclear explosive devices.

9 (e) PROCEDURES TO EXPEDITE LICENSING DECI10 SIONS.—Within 12 months after the date of enactment of

11 this Act, the Secretary of Commerce, in consultation with

12 the members of the Committee, shall develop procedures

13 to ensure that applicants for validated licenses for the ex14 port of nuclear dual-use items will receive notice of ap15 proval or denial of any such license not later than 60 days

16 after submission of an application.

17 TITLE III—AMENDMENTS TO

18 THE ATOMIC ENERGY ACT OF

19 1954

20 SEC. 301. SUBSEQUENT ARRANGEMENTS.

21 Section 131 of the Atomic Energy Act of 1954 (42

22 U.S.C. 2160) is amended—

23 (1) by inserting ‘‘and the Secretary of Defense’’

24 after ‘‘concurrence of the Secretary of State’’ in sub25 section a.(1);
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1 (2) by striking all after ‘‘and shall consult

2 with’’ through the colon and inserting ‘‘the Director

3 and the Commission:’’;

4 (3) in subsection a.(2), by striking ‘‘may’’ in

5 the first sentence and inserting ‘‘shall’’;

6 (4) in subsection b.(1), by inserting after ‘‘such

7 arrangement’’ the following ‘‘, including documenta8 tion of the technical basis for the Secretary’s judg9 ment that such arrangement will ensure timely

10 warning to the United States of any diversion well

11 in advance of the time at which the non-nuclear12 weapon state could transform the diverted material

13 into a nuclear explosive device,’’; and

14 (5) in subsection d., by striking all after

15 ‘‘States,’’ and inserting in lieu thereof the following:

16 ‘‘and nothing in this section is intended to promote

17 the reprocessing of spent fuel owned by any nation

18 which lacks a reasonable economic justification for

19 such reprocessing’’.

20 SEC. 302. COOPERATION WITH OTHER NATIONS.

21 Section 123 a. of the Atomic Energy Act of 1954 (42

22 U.S.C. 2153) is amended—

23 (1) by inserting ‘‘and the Secretary of Defense’’ after

24 ‘‘concurrence of the Secretary of Energy’’; and
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1 (2) by striking ‘‘jointly by the Secretary of State and

2 the Secretary of Energy’’ and inserting ‘‘jointly by the

3 Secretary of State, the Secretary of Energy, and the Sec4 retary of Defense’’.

5 SEC. 303. PROHIBITION ON FOREIGN PRODUCTION OF SPE6 CIAL NUCLEAR MATERIAL.

7 Section 57 b. of the Atomic Energy Act of 1954 (42

8 U.S.C. 2077) is amended—

9 (1) by inserting ‘‘and the Department of De10 fense’’ after ‘‘concurrence of the Department of

11 State’’; and

12 (2) by striking ‘‘the Department of Commerce,

13 and the Department of Defense’’ and inserting ‘‘and

14 the Department of Commerce’’.

15 SEC. 304. PROHIBITION ON NUCLEAR EXPORTS.

16 Section 129 of the Atomic Energy Act of 1954 (42

17 U.S.C. 2158) is amended by inserting after ‘‘No nuclear

18 materials and equipment’’ the following: ‘‘including any

19 items whose export from the United States is controlled

20 pursuant to the authorities of this Act, the Nuclear Non21 Proliferation Act of 1978, or the Nuclear Export Reorga22 nization Act of 1993,’’.
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1 SEC. 305. CONTROL OF COMPONENT PARTS.

2 Section 109 b. of the Atomic Energy Act of 1954 (42

3 U.S.C. 2139(b)) is amended by inserting ‘‘Defense,’’ after

4 ‘‘State,’’.

5 TITLE IV—SANCTIONS FOR

6 NUCLEAR PROLIFERATION

7 SEC. 401. IMPOSITION OF SANCTIONS.

8 (a) DETERMINATION BY THE PRESIDENT.—

9 (1) IN GENERAL.—Except as provided in sub10 section (b)(2), the President shall impose the appli11 cable sanctions described in subsection (c) if the

12 President determines that a foreign person or a

13 United States person, on or after the date of enact14 ment of this Act, has materially and with requisite

15 knowledge contributed—

16 (A) through the export from the United

17 States of any goods or technology that are sub18 ject to the jurisdiction of the United States, or

19 (B) through the export from any other

20 country of any goods or technology that would

21 be, if they were exported from the United

22 States, subject to the jurisdiction of the United

23 States,

24 to the efforts by any individual, group, or non-nu25 clear-weapon state to acquire unsafeguarded special

26 nuclear material or to use, develop, produce, stock-
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1 pile, or otherwise acquire any nuclear explosive de2 vice, whether or not the goods or technology is spe3 cifically designed or modified for that purpose.

4 (2) PERSONS AGAINST WHICH SANCTIONS ARE

5 TO BE IMPOSED.—Sanctions shall be imposed pursu6 ant to paragraph (1) on—

7 (A) the foreign person or United States

8 person with respect to which the President

9 makes the determination described in that para10 graph;

11 (B) any successor entity to that foreign

12 person or United States person;

13 (C) any foreign person or United States

14 person that is a parent or subsidiary of that

15 person if that parent or subsidiary materially

16 and with requisite knowledge assisted in the ac17 tivities which were the basis of that determina18 tion; and

19 (D) any foreign person or United States

20 person that is an affiliate of that person if that

21 affiliate materially and with requisite knowledge

22 assisted in the activities which were the basis of

23 that determination and if that affiliate is con24 trolled in fact by that foreign person.
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1 (3) OTHER SANCTIONS AVAILABLE.—The sanc2 tions which are required to be imposed for activities

3 described in this subsection are in addition to any

4 other sanction which may be imposed for the same

5 activities under any other provision of law.

6 (4) DEFINITION.—For purposes of this sub7 section, the term ‘‘requisite knowledge’’ means situa8 tions in which a person ‘‘knows’’, as ‘‘knowing’’ is

9 defined in section 104 of the Foreign Corrupt Prac10 tices Act of 1977 (15 U.S.C. 78dd–2), and includes

11 situations in which a person has reason to know.

12 (b) CONSULTATION WITH AND ACTIONS BY FOREIGN

13 GOVERNMENT OF JURISDICTION.—

14 (1) CONSULTATIONS.—If the President makes a

15 determination described in subsection (a)(1) with re16 spect to a foreign person, the Congress urges the

17 President to initiate consultations immediately with

18 the government with primary jurisdiction over that

19 foreign person with respect to the imposition of

20 sanctions pursuant to this section.

21 (2) ACTIONS BY GOVERNMENT OF JURISDIC22 TION.—In order to pursue such consultations with

23 that government, the President may delay imposition

24 of sanctions pursuant to this section for up to 90

25 days. Following these consultations, the President
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1 shall impose sanctions unless the President deter2 mines and certifies to the Congress that that govern3 ment has taken specific and effective actions, includ4 ing appropriate penalties, to terminate the involve5 ment of the foreign person in the activities described

6 in subsection (a)(1). The President may delay the

7 imposition of sanctions for up to an additional 90

8 days if the President determines and certifies to the

9 Congress that that government is in the process of

10 taking the actions described in the preceding sen11 tence.

12 (3) REPORT TO CONGRESS.—Not later than 90

13 days after making a determination under subsection

14 (a)(1), the President shall submit to the Committee

15 on Foreign Relations and the Committee on Govern16 mental Affairs of the Senate and the Committee on

17 Foreign Affairs of the House of Representatives a

18 report on the status of consultations with the appro19 priate government under this subsection, and the

20 basis for any determination under paragraph (2) of

21 this subsection that such government has taken spe22 cific corrective actions.

23 (c) SANCTIONS.—

24 (1) DESCRIPTION OF SANCTIONS.—The sanc25 tions to be imposed pursuant to subsection (a)(1)
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1 are, except as provided in paragraph (2) of this sub2 section, that the United States Government shall not

3 procure, or enter into any contract for the procure4 ment of, any goods or services from any person de5 scribed in subsection (a)(2).

6 (2) EXCEPTIONS.—The President shall not be

7 required to apply or maintain sanctions under this

8 section—

9 (A) in the case of procurement of defense

10 articles or defense services—

11 (i) under existing contracts or sub12 contracts, including the exercise of options

13 for production quantities to satisfy require14 ments essential to the national security of

15 the United States;

16 (ii) if the President determines that

17 the person or other entity to which the

18 sanctions would otherwise be applied is a

19 sole source supplier of the defense articles

20 or services, that the defense articles or

21 services are essential, and that alternative

22 sources are not readily or reasonably avail23 able; or

24 (iii) if the President determines that

25 such articles or services are essential to the
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1 national security under defense

2 coproduction agreements;

3 (B) to products or services provided under

4 contracts entered into before the date on which

5 the President publishes his intention to impose

6 the sanctions;

7 (C) to—

8 (i) spare parts which are essential to

9 United States products or production;

10 (ii) component parts, but not finished

11 products, essential to United States prod12 ucts or production; or

13 (iii) routine servicing and mainte14 nance of products, to the extent that alter15 native sources are not readily or reason16 ably available;

17 (D) to information and technology essen18 tial to United States products or production; or

19 (E) to medical or other humanitarian

20 items.

21 (d) ADVISORY OPINIONS.—(1) Upon the request of

22 any person, the Secretary of State may, after appropriate

23 consultation, issue an advisory opinion in writing to that

24 person as to whether a proposed activity by that person

25 would subject that person to sanctions under this section.
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1 (2) Issuance of an advisory opinion under paragraph

2 (1) shall not exempt any person from compliance with the

3 requirements of this Act.

4 (3) For purposes of this subsection, the term ‘‘appro5 priate consultation’’ means consultation by the Secretary

6 of State with the Secretary of Defense, the Director of

7 the Arms Control and Disarmament Agency, and the

8 heads of such other Federal agencies as the Secretary of

9 State may determine are necessary.

10 (e) TERMINATION OF SANCTIONS.—The sanctions

11 imposed pursuant to this section shall apply for a period

12 of at least 12 months following the imposition of sanctions

13 and shall cease to apply thereafter only if the President

14 determines and certifies to the Congress that—

15 (1) reliable information indicates that the for16 eign person or United States person with respect to

17 which the determination was made under subsection

18 (a)(1) has ceased to aid or abet any individual,

19 group, or non-nuclear-weapon state in its efforts to

20 acquire unsafeguarded special nuclear material or

21 any nuclear explosive device, as described in that

22 subsection; and

23 (2) the President has received reliable assur24 ances from the foreign person or United States per25 son, as the case may be, that such person will not,
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1 in the future, aid or abet any individual, group, or

2 non-nuclear-weapon state in its efforts to acquire

3 unsafeguarded special nuclear material or any nu4 clear explosive device, as described in subsection

5 (a)(1).

6 (f) WAIVER.—

7 (1) CRITERION FOR WAIVER.—The President

8 may waive the application of any sanction imposed

9 on any person pursuant to this section, after the end

10 of the 12-month period beginning on the date on

11 which that sanction was imposed on that person, if

12 the President determines and certifies to the Con13 gress that the continued imposition of the sanction

14 would have a serious adverse effect on vital United

15 States interests.

16 (2) NOTIFICATION OF AND REPORT TO CON17 GRESS.—If the President decides to exercise the

18 waiver authority provided in paragraph (1), the

19 President shall so notify the Congress not less than

20 20 days before the waiver takes effect. Such notifica21 tion shall include a report fully articulating the ra22 tionale and circumstances which led the President to

23 exercise the waiver authority.

24 (g) DEFINITIONS.—For purposes of this section—

25 (1) the term ‘‘foreign person’’ means—
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1 (A) an individual who is not a citizen of

2 the United States or an alien admitted for per3 manent residence to the United States; or

4 (B) a corporation, partnership, or other

5 nongovernment entity which is created or orga6 nized under the laws of a foreign country or

7 which has its principal place of business outside

8 the United States; and

9 (2) the term ‘‘United States person’’ means—

10 (A) an individual who is a citizen of the

11 United States or an alien admitted for perma12 nent residence to the United States; or

13 (B) a corporation, partnership, or other

14 entity which is not a foreign person.

15 SEC. 402. ELIGIBILITY FOR ASSISTANCE.

16 (a) AMENDMENTS TO THE ARMS EXPORT CONTROL

17 ACT.—(1) Section 3 of the Arms Export Control Act (22

18 U.S.C. 2753) is amended by adding at the end the follow19 ing new subsection:

20 ‘‘(f) No sales or leases shall be made under this Act

21 to any country that the President has determined is in

22 material breach of its commitments to the United States

23 under international treaties or agreements concerning the

24 nonproliferation of nuclear explosive devices (as defined in

25 section 3(9) of the Nuclear Export Reorganization Act of
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1 1993) and unsafeguarded special nuclear material (as de2 fined in section 3(13) of that Act).’’.

3 (2) Section 40 of such Act (22 U.S.C. 2780) is

4 amended—

5 (A) in subsection (d), by adding at the end the

6 following new sentence: ‘‘For purposes of this sub7 section, such acts shall include any activity that the

8 Secretary determines willfully aids or abets the

9 international proliferation of nuclear explosive de10 vices to an individual or group or willfully aids or

11 abets an individual or group in acquiring

12 unsafeguarded special nuclear material.’’; and

13 (B) in subsection (l)—

14 (i) in paragraph (2), by striking ‘‘and’’

15 after the semicolon;

16 (ii) in paragraph (3), by striking the pe17 riod at the end and inserting a semicolon; and

18 (iii) by adding at the end the following:

19 ‘‘(4) the term ‘nuclear explosive device’ has the

20 meaning given that term in section 3(9) of the Nu21 clear Export Reorganization Act of 1993; and

22 ‘‘(5) the term ‘unsafeguarded special nuclear

23 material’ has the meaning given that term in section

24 3(13) of the Nuclear Export Reorganization Act of

25 1993.’’.
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1 (b) AMENDMENTS TO THE FOREIGN ASSISTANCE

2 ACT OF 1961.—

3 (1) Section 670(a)(2) of the Foreign Assistance

4 Act of 1961 (22 U.S.C. 2429a(a)(2)) is amended in

5 the first sentence—

6 (A) by inserting ‘‘in any fiscal year’’ after

7 ‘‘President’’; and

8 (B) by inserting ‘‘during that fiscal year’’

9 after ‘‘certifies in writing’’.

10 (2) Notwithstanding any other provision of law,

11 Presidential Determination No. 82–7 of February

12 10, 1982, shall have no force or effect with respect

13 to any grounds for the prohibition of assistance

14 under section 670(a)(1) of such Act arising on or

15 after the date of enactment of this Act.

16 (3) Section 620E(d) of the Foreign Assistance

17 Act of 1961 (22 U.S.C. 2375(d)) is amended to read

18 as follows:

19 ‘‘(d) The President may waive the prohibitions of sec20 tion 669 of this Act with respect to any grounds for the

21 prohibition of assistance under that section arising before

22 the date of enactment of the Nuclear Export Reorganiza23 tion Act of 1993 to provide assistance to Pakistan if he

24 determines that to do so is in the national interest of the

25 United States.’’.
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1 SEC. 403. ROLE OF INTERNATIONAL FINANCIAL INSTITU2 TIONS.

3 (a) IN GENERAL.—The Secretary of the Treasury

4 shall instruct the United States executive director to each

5 of the international financial institutions described in sec6 tion 701(a) of the International Financial Institutions Act

7 (22 U.S.C. 262d(a)) to use the voice and vote of the Unit8 ed States to oppose any direct or indirect use of the insti9 tution’s funds to promote the acquisition of unsafeguarded

10 special nuclear material or the development, stockpiling,

11 or use of any nuclear explosive device by any non-nuclear12 weapon state.

13 (b) DUTIES OF UNITED STATES EXECUTIVE DIREC14 TORS.—Section 701(b)(3) of the International Financial

15 Institutions Act (22 U.S.C. 262d(b)(3)) is amended to

16 read as follows:

17 ‘‘(3) whether the recipient country—

18 ‘‘(A) has been found by the President to be

19 seeking to acquire unsafeguarded special nu20 clear material (as defined in section 3(13) of

21 the Nuclear Export Reorganization Act of

22 1993) or a nuclear explosive device (as defined

23 in section 3(9) of that Act);

24 ‘‘(B) is not a State Party to the Treaty on

25 Non-Proliferation of Nuclear Weapons; or
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1 ‘‘(C) has detonated a nuclear explosive de2 vice; and’’.

3 SEC. 404. AMENDMENT TO THE INTERNATIONAL EMER4 GENCY ECONOMIC POWERS ACT.

5 Section 202 of the International Emergency Eco6 nomic Powers Act (50 U.S.C. 1701) is amended by adding

7 at the end thereof the following new subsection:

8 ‘‘(c) For the purpose of this section, the term ‘any

9 unusual and extraordinary threat’ includes any inter10 national event that the President determines may involve

11 the detonation of a nuclear explosive device (as defined

12 in section 3(9) of the Nuclear Export Reorganization Act

13 of 1993) or an action or activity that substantially contrib14 utes to the likelihood of the proliferation or detonation of

15 such devices, including the acquisition by a non-nuclear16 weapon state of unsafeguarded special nuclear material

17 (as defined in section 3(13) of that Act).’’.

18 SEC. 405. AMENDMENT TO THE FEDERAL DEPOSIT INSUR19 ANCE CORPORATION IMPROVEMENT ACT OF

20 1991.

21 The Federal Deposit Insurance Corporation Improve22 ment Act of 1991 is amended by adding at the end the

23 following new title:
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1 ‘‘TITLE VI—SANCTIONS ON

2 FINANCIAL INSTITUTIONS

3 ‘‘SEC. 601. PRESIDENTIAL DETERMINATION.

4 ‘‘(a) IN GENERAL.—The prohibitions in section 603

5 shall be imposed on a financial institution if the President

6 determines that such financial institution, on or after the

7 date which is 60 days after the date of enactment of this

8 section, has materially and with requisite knowledge con9 tributed, through provision of financing or other services,

10 to the efforts by any individual, group, or non-nuclear11 weapon state to acquire unsafeguarded special nuclear ma12 terial or to use, develop, produce, stockpile, or otherwise

13 acquire any nuclear explosive device, as these standards

14 and terms would be applied under section 401(a) of the

15 Nuclear Export Reorganization Act of 1993.

16 ‘‘(b) PRESIDENTIAL ORDER.—Whenever the Presi17 dent makes a determination under subsection (a) with re18 spect to a financial institution, the President shall issue

19 an order specifying a date within 180 days after such de20 termination on which the prohibitions in section 603 shall

21 begin to apply to such institution.

22 ‘‘SEC. 602. ADDITIONAL ENTITIES AGAINST WHICH SANC23 TIONS ARE TO BE IMPOSED.

24 ‘‘The prohibitions described in section 603 shall also

25 be imposed, pursuant to section 601, on—
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1 ‘‘(1) any successor entity to the financial insti2 tution with respect to which the President makes a

3 determination under section 601(a);

4 ‘‘(2) any foreign person or United States person

5 that is a parent or subsidiary of that financial insti6 tution if that parent or subsidiary materially and

7 with requisite knowledge assisted in the activities

8 which were the basis of that determination; and

9 ‘‘(3) any foreign person or United States person

10 that is an affiliate of that financial institution if that

11 affiliate materially and with requisite knowledge as12 sisted in the activities which were the basis of such

13 determination and if that affiliate is controlled in

14 fact by that financial institution.

15 ‘‘SEC. 603. PROHIBITIONS.

16 ‘‘The following prohibitions shall apply to a financial

17 institution with respect to which a determination is made

18 under section 601(a) and to the entities described in sec19 tion 602:

20 ‘‘(1) BAN ON DEALINGS IN GOVERNMENT FI21 NANCE.—

22 ‘‘(A) DESIGNATION AS PRIMARY DEAL23 ER.—Neither the Board of Governors of the

24 Federal Reserve System nor the Federal Re25 serve Bank of New York may designate, or per-
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1 mit the continuation of any prior designation

2 of, such financial institution or any such entity

3 as a primary dealer in United States Govern4 ment debt instruments.

5 ‘‘(B) GOVERNMENT FUNDS.—Such finan6 cial institution or any such entity shall not

7 serve as agent of the United States Government

8 or serve as repository for United States Govern9 ment funds.

10 ‘‘(2) RESTRICTIONS ON OPERATIONS.—Such fi11 nancial institution or any such entity shall not, di12 rectly or indirectly—

13 ‘‘(A) commence any line of business in the

14 United States in which it was not engaged as

15 of the date of the determination; or

16 ‘‘(B) conduct business from any location in

17 the United States at which it did not conduct

18 business as of the date of the determination.

19 ‘‘SEC. 604. CONDITIONS AND TERMINATION OF SANCTIONS.

20 ‘‘The same requirements for consultation with the

21 foreign government of jurisdiction, where appropriate, and

22 for termination of sanctions shall apply under this title

23 as are provided in subsections (b) and (e), respectively,

24 of section 401 of the Nuclear Export Reorganization Act

25 of 1993.
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1 ‘‘SEC. 605. WAIVER.

2 ‘‘The President may waive the imposition of any pro3 hibition imposed on any financial institution or other en4 tity pursuant to section 601 or 602 if the President deter5 mines and certifies to the Congress that the imposition

6 of such prohibition would have a serious adverse effect on

7 the safety and soundness of the domestic or international

8 financial system or on domestic or international payments

9 systems.

10 ‘‘SEC. 606. DEFINITIONS.

11 ‘‘As used in this title—

12 ‘‘(1) the term ‘financial institution’ includes—

13 ‘‘(A) a depository institution, including a

14 branch or agency of a foreign bank;

15 ‘‘(B) a securities firm, including a broker

16 or dealer;

17 ‘‘(C) an insurance company, including an

18 agency or underwriter;

19 ‘‘(D) any other company that provides fi20 nancial services; or

21 ‘‘(E) any subsidiary of any entity described

22 in subparagraph (A), (B), (C), or (D);

23 ‘‘(2) the term ‘requisite knowledge’ means situ24 ations in which a person ‘knows’, as ‘knowing’ is de25 fined in section 104 of the Foreign Corrupt Prac26 tices Act of 1977 (15 U.S.C. 78dd–2), and includes
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1 situations in which a person has reason to know;

2 and

3 ‘‘(3) the terms ‘foreign person’ and ‘United

4 States person’ have the meanings given those terms

5 in section 401(g) of the Nuclear Export Reorganiza6 tion Act of 1993.’’.

7 SEC. 406. EXPORT-IMPORT BANK OF THE UNITED STATES.

8 Section 2(b)(4) of the Export-Import Bank Act of

9 1945 (12 U.S.C. 635(b)(4)) is amended in the first sen10 tence by inserting after ‘‘device’’ the following: ‘‘(as de11 fined in section 3(9) of the Nuclear Export Reorganization

12 Act of 1993), or that any country has willfully aided or

13 abetted any non-nuclear-weapon state (as defined in sec14 tion 3(7) of that Act) to acquire any such nuclear explo15 sive device or to acquire unsafeguarded special nuclear

16 material (as defined in section 3(13) of that Act).’’.

17 SEC. 407. ADDITIONAL AMENDMENTS TO THE FOREIGN AS18 SISTANCE ACT OF 1961.

19 (a) ADDITIONAL SANCTIONS.—Section 670 of the

20 Foreign Assistance Act of 1961 (22 U.S.C. 2429a(b)) is

21 amended—

22 (1) in subsection (b), by redesignating para23 graphs (2), (3), and (4) as paragraphs (4), (5), and

24 (6), respectively; and
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1 (2) by amending subsection (b)(1) to read as

2 follows:

3 ‘‘(b)(1) Except as provided in paragraphs (4), (5),

4 and (6), in the event that the President determines that

5 any country, after the date of enactment of the Nuclear

6 Export Reorganization Act of 1993—

7 ‘‘(A) transfers to a non-nuclear-weapon state a

8 nuclear explosive device,

9 ‘‘(B) is a non-nuclear-weapon state and ei10 ther—

11 ‘‘(i) receives a nuclear explosive device, or

12 ‘‘(ii) detonates a nuclear explosive device,

13 ‘‘(C) transfers to a non-nuclear-weapon state

14 any design information or component which is deter15 mined by the President to be important to, and

16 known by the transferring country to be intended by

17 the recipient state for use in, the development or

18 manufacture of any nuclear explosive device, or

19 ‘‘(D) is a non-nuclear-weapon state and has

20 sought and received any design information or com21 ponent which is determined by the President to be

22 important to, and intended by the recipient state for

23 use in, the development or manufacture of any nu24 clear explosive device,
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1 then the President shall forthwith report in writing his

2 determination to the Congress and shall forthwith impose

3 the sanctions described in paragraph (2) against that

4 country.

5 ‘‘(2) The sanctions referred to in paragraph (1) are

6 as follows:

7 ‘‘(A) The United States Government shall ter8 minate assistance to that country under this Act, ex9 cept for humanitarian assistance or food or other

10 agricultural commodities.

11 ‘‘(B) The United States Government shall ter12 minate—

13 ‘‘(i) sales to that country under the Arms

14 Export Control Act of any defense articles, de15 fense services, or design and construction serv16 ices, and

17 ‘‘(ii) licenses for the export to that country

18 of any item on the United States Munitions

19 List.

20 ‘‘(C) The United States Government shall ter21 minate all foreign military financing for that country

22 under the Arms Export Control Act.

23 ‘‘(D) The United States Government shall deny

24 to that country any credit, credit guarantees, or

25 other financial assistance by any department, agen-
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1 cy, or instrumentality of the United States Govern2 ment, except that the sanction of this subparagraph

3 shall not apply—

4 ‘‘(i) to any transaction subject to the re5 porting requirements of title V of the National

6 Security Act of 1947 (relating to congressional

7 oversight of intelligence activities), or

8 ‘‘(ii) to humanitarian assistance.

9 ‘‘(E) The United States Government shall op10 pose, in accordance with section 701 of the Inter11 national Financial Institutions Act (22 U.S.C.

12 262d), the extension of any loan or financial or tech13 nical assistance to that country by any international

14 financial institution.

15 ‘‘(F) The United States Government shall pro16 hibit any United States bank from making any loan

17 or providing any credit to the government of that

18 country, except for loans or credits for the purpose

19 of purchasing food or other agricultural commod20 ities.

21 ‘‘(G) The President shall prohibit exports to

22 that country of all goods and technology (excluding

23 food and other agricultural commodities), except

24 that such prohibition shall not apply to any trans25 action subject to the reporting requirements of title
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1 V of the National Security Act of 1947 (relating to

2 congressional oversight of intelligence activities).

3 ‘‘(3) As used in this subsection—

4 ‘‘(A) the term ‘design information’ means infor5 mation that relates to the design of a nuclear explo6 sive device and that is not available to the public;

7 and

8 ‘‘(B) the term ‘component’ means a component

9 of a nuclear explosive device.’’.

10 (b) DEFINITION OF NUCLEAR EXPLOSIVE DEVICE.—

11 Section 644 of the Foreign Assistance Act of 1961 (22

12 U.S.C. 2403) is amended by adding at the end the follow13 ing:

14 ‘‘(q) ‘Nuclear explosive device’ has the meaning given

15 that term in section 3(9) of the Nuclear Export Reorga16 nization Act of 1993.’’.

17 (c) CONFORMING AMENDMENTS.—Section 670(b) of

18 the Foreign Assistance Act of 1961 (22 U.S.C. 2429a(b))

19 is further amended—

20 (1) in paragraph (4) (as redesignated by sub21 section (a)(1) of this section)—

22 (A) in subparagraph (A)—

23 (i) by striking ‘‘furnish assistance

24 which would otherwise be prohibited under

25 paragraph (1)’’ and inserting ‘‘delay the
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1 imposition of sanctions which would other2 wise be required under paragraph (1)(A)

3 or (1)(B)’’;

4 (ii) by striking ‘‘, before furnishing

5 such assistance, the President’’ and insert6 ing ‘‘the President first’’; and

7 (iii) by striking ‘‘termination of assist8 ance to’’ and inserting ‘‘imposition of sanc9 tions on’’;

10 (B) in subparagraph (B) by striking ‘‘(3)’’

11 and inserting ‘‘(5)’’; and

12 (C) in subparagraph (E)—

13 (i) by striking ‘‘(b)(2)’’ and inserting

14 ‘‘(b)(4)’’; and

15 (ii) by striking ‘‘(b)(3)’’ and inserting

16 ‘‘(b)(5)’’;

17 (2) in paragraph (5) (as so redesignated)—

18 (A) by striking ‘‘(2)’’ and inserting ‘‘(4)’’;

19 (B) by striking ‘‘furnish assistance which

20 would otherwise be prohibited under paragraph

21 (1)’’ and inserting ‘‘waive any sanction which

22 would otherwise be required under paragraph

23 (1)(A) or (1)(B)’’; and
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1 (C) by striking ‘‘termination of such assist2 ance’’ and inserting ‘‘imposition of such sanc3 tion’’;

4 (3) by redesignating paragraph (6) (as so re5 designated) as paragraph (7); and

6 (4) by inserting after paragraph (5) (as so re7 designated) the following:

8 ‘‘(6) Notwithstanding any other provision of

9 law, the sanctions which are required to be imposed

10 against a country under paragraph (1)(C) or (1)(D)

11 shall not apply if the President determines and cer12 tifies in writing to the Committee on Foreign Rela13 tions and the Committee on Governmental Affairs of

14 the Senate and the Committee on Foreign Affairs of

15 the House of Representatives that the application of

16 such sanctions against such country would have a

17 serious adverse effect on vital United States inter18 ests. The President shall transmit with such certifi19 cation a statement setting forth the specific reasons

20 therefor.’’.

21 SEC. 408. REWARD.

22 Section 36(a) of the State Department Basic Au23 thorities Act of 1956 (22 U.S.C. 2708(a)) is amended—

24 (1) by redesignating paragraphs (1) through

25 (3) as subparagraphs (A) through (C), respectively;
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1 (2) by inserting ‘‘(1)’’ after ‘‘(a)’’; and

2 (3) by adding at the end the following:

3 ‘‘(2) For purposes of this subsection, the term

4 ‘act of international terrorism’ includes any act sub5 stantially contributing to the acquisition of

6 unsafeguarded special nuclear material (as defined

7 in section 3(13) of the Nuclear Export Reorganiza8 tion Act of 1993) or any nuclear explosive device (as

9 defined in section 3(9) of that Act) by an individual

10 or group.’’.

11 SEC. 409. REPORTS.

12 (a) CONTENT OF ACDA ANNUAL REPORT.—Section

13 52 of the Arms Control and Disarmament Act (22 U.S.C.

14 2592) is amended—

15 (1) by inserting ‘‘(a) IN GENERAL.—’’ before

16 ‘‘The Congress’’;

17 (2) by striking ‘‘and’’ at the end of paragraph

18 (4);

19 (3) by striking the period at the end of para20 graph (5) and inserting ‘‘; and’’;

21 (4) by adding after paragraph (5) the following

22 new paragraph:

23 ‘‘(6) a section of the report shall deal with any

24 material noncompliance by foreign governments with

25 their commitments to the United States with respect
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1 to the prevention of the spread of nuclear explosive

2 devices (as defined in section 3(9) of the Nuclear

3 Export Reorganization Act of 1993) by non-nuclear4 weapon states (as defined in section 3(7) of that

5 Act) or the acquisition by such states of

6 unsafeguarded special nuclear material (as defined

7 in section 3(13) of that Act), including—

8 ‘‘(A) a net assessment of the aggregate

9 military significance of all such violations;

10 ‘‘(B) a statement of the compliance policy

11 of the United States with respect to violations

12 of those commitments; and

13 ‘‘(C) what actions, if any, the President

14 has taken or proposes to take to bring any na15 tion committing such a violation into compli16 ance with its commitments.’’; and

17 (5) by adding at the end the following new sub18 section:

19 ‘‘(b) REPORTING CONSECUTIVE NONCOMPLIANCE.—

20 If the President in consecutive reports submitted to the

21 Congress under this section reports that any designated

22 nation is not in full compliance with its nonproliferation

23 commitments to the United States, then the President

24 shall include in the second such report an assessment of
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1 what actions are necessary to compensate for such viola2 tions.’’.

3 (b) REPORTING ON DEMARCHES.—(1)(A) Not later

4 than six months after the date of enactment of this Act,

5 the President shall submit to the congressional committees

6 specified in section 602(c) of the Nuclear Non-Prolifera7 tion Act of 1978 an unclassified report that shall state

8 the number of high-level demarches that was issued or re9 ceived by the United States with respect to activities relat10 ed to the proliferation of nuclear explosive devices.

11 (B) The report described in subparagraph (A) shall

12 cover demarches issued or received during the period be13 ginning January 1, 1981, and ending December 31, 1993,

14 and shall identify for each demarche the foreign country

15 issuing or receiving the demarche, as the case may be.

16 (2)(A) Section 601(a) of the Nuclear Non-Prolifera17 tion Act of 1978 (22 U.S.C. 3281(a)), as amended by sec18 tion 101, is further amended—

19 (i) in paragraph (5), by striking ‘‘and’’ after

20 the semicolon;

21 (ii) in paragraph (6), by striking the period and

22 inserting ‘‘; and’’; and

23 (iii) by adding after paragraph (6) the following

24 new paragraph:
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1 ‘‘(7) a statement of the number of all high-level

2 demarches (as defined in section 209(b)(4) of the

3 Omnibus Nuclear Proliferation Control Act of 1993)

4 issued by or received by the United States with re5 spect to activities related to the proliferation of nu6 clear explosive devices, and shall identify each for7 eign country issuing or receiving such a demarche,

8 in the preceding calendar year.’’.

9 (B) The amendments made by subparagraph (A)

10 shall take effect on January 1, 1995.

11 (3) It is the sense of the Congress that the Depart12 ment of State should, in the course of implementing its

13 reporting responsibilities under section 602(c) of the Nu14 clear Non-Proliferation Act of 1978, include a summary

15 of all demarches that the United States has issued or re16 ceived from foreign governments with respect to activities

17 which are of significance from the proliferation standpoint.

18 (4) For purposes of this subsection, the term ‘‘high19 level demarche’’ means any official communication by one

20 government to another at the presidential, vice presi21 dential, ministerial, or ambassadorial level, by written or

22 oral means, intended by the originating government to ex23 press—

24 (A) a concern over a past, present, or possible

25 future action or activity of the recipient government,
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1 or of a person within the jurisdiction of that govern2 ment, contributing to the global spread of

3 unsafeguarded special nuclear material or of nuclear

4 explosive devices;

5 (B) a request for the recipient government to

6 counter such action or activity; or

7 (C) both the concern and request described in

8 subparagraphs (A) and(B).

9 SEC. 410. TECHNICAL CORRECTION.

10 Section 133 b. of the Atomic Energy Act of 1954 (42

11 U.S.C. 2160c) is amended by striking ‘‘20 kilograms’’ and

12 inserting ‘‘5 kilograms’’.

13 TITLE V—INTERNATIONAL

14 ATOMIC ENERGY AGENCY

15 SEC. 501. BILATERAL AND MULTILATERAL INITIATIVES.

16 It is the sense of the Congress that in order to main17 tain and enhance international confidence in the effective18 ness of IAEA safeguards and in other multilateral under19 takings to halt the global proliferation of nuclear explosive

20 devices and associated technology, the United States

21 should seek to negotiate with other nations and groups

22 of nations, including the IAEA Board of Governors and

23 the Nuclear Suppliers Group, to—

24 (1) build international support for the principle

25 that each nuclear supply relationship involving a
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1 non-nuclear weapon state must include a commit2 ment by such state to the application of full-scope

3 international safeguards;

4 (2) encourage each nuclear-weapon state within

5 the meaning of the Treaty on the Non-Proliferation

6 of Nuclear Weapons to undertake a comprehensive

7 review of its own procedures for declassifying infor8 mation relating to the design or production of nu9 clear explosive devices and to investigate any meas10 ures that would reduce the risk of such information

11 contributing to the proliferation of such devices;

12 (3) encourage the deferral of efforts to separate

13 plutonium or enrich uranium to 20 percent uranium14 235 or more;

15 (4) pursue greater financial support for the im16 plementation and improvement of safeguards from

17 all IAEA member nations with significant nuclear

18 programs, particularly from those nations that are

19 currently using or planning to use direct-use mate20 rial for commercial purposes;

21 (5) arrange for the timely payment of annual fi22 nancial contributions by all members of the IAEA,

23 including the United States;

24 (6) discourage international commerce in highly

25 enriched uranium for use in research reactors while
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1 encouraging multilateral cooperation to develop and

2 to use low-enriched alternative nuclear fuels;

3 (7) oppose efforts by non-nuclear-weapon states

4 to develop or use unsafeguarded nuclear fuels for

5 purposes of naval propulsion;

6 (8) pursue an international arrangement that

7 would authorize the IAEA to operate surveillance

8 aircraft and would facilitate IAEA access to satellite

9 information for safeguards verification purposes;

10 (9) develop an institutional means for IAEA

11 member nations to share information with the IAEA

12 on possible safeguards violations;

13 (10) require any exporter of a sensitive nuclear

14 facility or sensitive nuclear technology to notify the

15 IAEA prior to export and to require safeguards over

16 that facility or technology, regardless of its destina17 tion;

18 (11) seek agreement among the parties to the

19 Treaty to apply IAEA safeguards in perpetuity and

20 to consider the establishment of new limits on the

21 right to withdraw from the Treaty;

22 (12) encourage other nations to adopt legisla23 tion that would tighten penalties against companies

24 and individuals that knowingly and materially assist
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1 any non-nuclear-weapon state or group to acquire a

2 nuclear explosive device;

3 (13) encourage the creation under IAEA aus4 pices of international repositories for the long-term

5 storage of spent nuclear fuel; and

6 (14) develop measures to ensure the safe and

7 long-term storage under international auspices of

8 special fissionable material recovered as a con9 sequence of nuclear disarmament accords.

10 SEC. 502. REFORMS IN IAEA SAFEGUARDS.

11 In order to promote the early adoption of reforms in

12 the implementation of the safeguards responsibilities of

13 the IAEA, the Congress urges the President to negotiate

14 with other nations and groups of nations, including the

15 IAEA Board of Governors and the Nuclear Suppliers

16 Group, to—

17 (1) improve the access of the IAEA within non18 nuclear weapon states to nuclear facilities that are

19 capable of producing, processing, or fabricating spe20 cial fissionable material suitable for use in a nuclear

21 explosive device;

22 (2)(A) facilitate the IAEA’s efforts to meet and

23 to maintain its own goals for detecting the diversion

24 of nuclear materials and equipment, giving particu-
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1 lar attention to facilities in which there are bulk

2 quantities of plutonium; and

3 (B) if it is not technically feasible for the IAEA

4 to meet those detection goals in a particular facility,

5 require the IAEA to declare publicly that it is un6 able to do so;

7 (3) enable the IAEA to issue fines for violations

8 of safeguards procedures, to pay rewards for infor9 mation on possible safeguards violations, and to es10 tablish a ‘hot line’ for the reporting of such viola11 tions and other illicit uses of direct-use material;

12 (4) examine the feasibility of applying safe13 guards at facilities engaged in the manufacture of

14 equipment or material that is especially designed or

15 prepared for the processing, use, or production of

16 special fissionable material or, in the case of non-nu17 clear-weapon states, of any nuclear explosive device;

18 (5) examine the feasibility of applying safe19 guards over research and development activities and

20 facilities involving sensitive nuclear technology, as

21 defined in section 4(a)(6) of the Nuclear Non-Pro22 liferation Act of 1978, or any other technology di23 rectly related to the acquisition or production of nu24 clear explosive devices;
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1 (6) implement special inspections of undeclared

2 nuclear facilities, as provided for under existing safe3 guards procedures, and seek authority for the IAEA

4 to conduct short-notice inspections on demand at

5 suspected nuclear sites;

6 (7) expand the scope of safeguards to include

7 tritium, uranium concentrates, and nuclear waste

8 containing significant quantities of special fission9 able material, and increase the scope of such safe10 guards on heavy water;

11 (8) revise downward the IAEA’s official mini12 mum amounts of nuclear material (‘‘significant

13 quantity’’) needed to make a nuclear explosive device

14 and establish these amounts as national rather than

15 facility standards;

16 (9) expand the use of full-time resident IAEA

17 inspectors at sensitive fuel cycle facilities;

18 (10) require the use of near real time material

19 accountancy in the conduct of safeguards at facili20 ties that use, produce, or store significant quantities

21 of special fissionable material;

22 (11) develop with other IAEA member nations

23 an agreement on procedures to expedite approvals of

24 visa applications by IAEA inspectors;
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1 (12) provide the IAEA the additional funds,

2 technical assistance, and political support necessary

3 to carry out the goals set forth in this subsection;

4 and

5 (13) make public the annual safeguards imple6 mentation report of the IAEA, establishing a public

7 registry of commodities in international nuclear com8 merce, including dual-use goods, and creating a pub9 lic repository of current nuclear trade control laws,

10 agreements, regulations, and enforcement and judi11 cial actions by IAEA member nations.

12 SEC. 503. REPORTING REQUIREMENT.

13 (a) REPORT REQUIRED.—The President shall, in the

14 report required by section 601(a) of the Nuclear Non-Pro15 liferation Act of 1978, describe—

16 (1) the steps he has taken to implement sec17 tions 501 and 502, and

18 (2) the progress that has been made and the

19 obstacles that have been encountered in seeking to

20 meet the objectives set forth in sections 501 and

21 502.

22 (b) CONTENTS OF REPORT.—Each report under

23 paragraph (1) shall describe—

24 (1) the bilateral and multilateral initiatives that

25 the President has taken during the period since the
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1 enactment of this Act in pursuit of each of the ob2 jectives set forth in sections 501 and 502;

3 (2) any obstacles that have been encountered in

4 the pursuit of those initiatives;

5 (3) any additional initiatives that have been

6 proposed by other countries or international organi7 zations to strengthen the implementation of IAEA

8 safeguards;

9 (4) all activities of the Federal Government in

10 support of the objectives set forth in sections 501

11 and 502;

12 (5) any recommendations of the President on

13 additional measures to enhance the effectiveness of

14 IAEA safeguards; and

15 (6) any initiatives that the President plans to

16 take in support of each of the objectives set forth in

17 sections 501 and 502.

18 TITLE VI—REVIEW OF

19 PLUTONIUM USE POLICY

20 SEC. 601. FINDINGS AND DECLARATIONS.

21 The Congress finds and declares that—

22 (1) reactor-grade plutonium is a direct-use ma23 terial;
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1 (2) plutonium in all forms is hazardous to the

2 human and natural environment and is a potential

3 radiological weapon;

4 (3) nuclear reprocessing programs that produce,

5 or are intended to produce, large amounts of pluto6 nium, especially amounts of plutonium that exceed

7 the reasonable economic needs of a country, for civil8 ian uses jeopardize the efforts of the United States,

9 other nations, and international organizations to re10 duce the global risks of nuclear weapons prolifera11 tion, nuclear terrorism, and environmental contami12 nation;

13 (4) the United States Government has sus14 pended the production of military plutonium and has

15 abandoned civil reprocessing and breeder reactor de16 velopment in the United States;

17 (5) more than 500 metric tons of plutonium

18 currently exist in civilian nuclear fuel worldwide,

19 more than 100 metric tons of plutonium have al20 ready been separated from nuclear fuel irradiated in

21 civilian reactors, and more than 200 metric tons of

22 plutonium exist in declared nuclear weapons stock23 piles;

24 (6) on July 16, 1981, the President announced

25 a policy that the United States ‘‘will not inhibit or
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1 set back civil reprocessing and breeder reactor devel2 opment in nations with advanced nuclear power pro3 grams where it does not constitute a proliferation

4 risk’’;

5 (7) much of the world surplus of civil plutonium

6 has resulted from foreign nuclear reprocessing ac7 tivities undertaken pursuant to agreements for nu8 clear cooperation with the United States that were

9 negotiated or sustained under this policy and that

10 grant long-term United States approval for civilian

11 uses of plutonium recovered from United States-sup12 plied nuclear fuel;

13 (8) large amounts of additional civil plutonium,

14 far exceeding the amounts of plutonium now con15 tained in nuclear weapons, may soon be recovered in

16 reprocessing plants that are about to be started up

17 or constructed in the European Community and

18 Japan under this policy;

19 (9) once these new plants start up and become

20 contaminated with radiation, the environmental dif21 ficulties of shutdown and clean-up increase dramati22 cally;

23 (10) abundant and inexpensive global sources of

24 uranium and uranium enrichment services have
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1 steadily eroded the economic need for the use of plu2 tonium in civilian nuclear reactors;

3 (11) breeder reactors were once supposed to be

4 the principal consumers of civil plutonium but have

5 now encountered major financial and technical prob6 lems and recently have been abandoned or shut

7 down in Germany, France, and Britain and have

8 suffered major delays in Japan;

9 (12) reprocessing was once regarded as an eco10 nomic and efficient approach to nuclear fuel recy11 cling and waste management but is now widely rec12 ognized as extremely costly and posing major envi13 ronmental hazards; and

14 (13) the Deputy Director of the International

15 Atomic Energy Agency has recently stated that ‘‘the

16 excess of plutonium from civilian nuclear programs

17 poses a major political and security problem world18 wide’’.

19 SEC. 602. REPORT.

20 The President shall—

21 (1) reexamine the policy described in section

22 601(6); and

23 (2) not later than 90 days after the date of en24 actment of this Act—
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1 (A) take account of the significant changes

2 in the global security environment and in the

3 global nuclear market since 1981 by modifying

4 the policy described in section 601(6) to avoid

5 the political and security problems associated

6 with excess plutonium from civilian nuclear pro7 grams in the world; and

8 (B) submit a report to the Congress de9 scribing the steps taken to modify the policy.

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