I

103D CONGRESS

1ST SESSION H. R. 2358

To impose sanctions against any foreign person or United States person

that assists a foreign country in acquiring a nuclear explosive device

or unsafeguarded nuclear material, 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 impose sanctions against any foreign person or United

States person that assists a foreign country in acquiring

a nuclear explosive device or unsafeguarded nuclear material, 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 ‘‘Omnibus Nuclear

5 Proliferation Control 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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TITLE I—REPORTING ON NUCLEAR EXPORTS

Sec. 101. Reports of the President.

TITLE II—SANCTIONS FOR NUCLEAR PROLIFERATION

Sec. 201. Imposition of sanctions.

Sec. 202. Eligibility for assistance.

Sec. 203. Role of international financial institutions.

Sec. 204. Amendment to the International Emergency Economic Powers Act.

Sec. 205. Amendment to the Federal Deposit Insurance Corporation Improvement Act of 1991.

Sec. 206. Export-Import Bank of the United States.

Sec. 207. Additional amendments to the Foreign Assistance Act of 1961.

Sec. 208. Reward.

Sec. 209. Reports.

Sec. 210. Technical correction.

TITLE III—INTERNATIONAL ATOMIC ENERGY AGENCY

Sec. 301. Bilateral and multilateral initiatives.

Sec. 302. IAEA internal reforms.

Sec. 303. Reporting requirement.

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 transmuta6 tion or further enrichment, such as plutonium con7 taining less than 80 percent plutonium-238, ura8 nium enriched to 20 percent uranium-235 or more,

9 uranium-233, and chemical compounds, mixtures of

10 direct-use materials (including mixed oxide reactor

11 fuel), and plutonium contained in spent nuclear fuel.

12 (2) the term ‘‘goods or technology’’ means nu13 clear materials and equipment and sensitive nuclear

14 technology (as such terms are defined in section 4

15 of the Nuclear Non-Proliferation Act of 1978), all
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1 export items designated by the President pursuant

2 to section 309(c) of the Nuclear Non-Proliferation

3 Act of 1978, and all technical assistance requiring

4 authorization under section 57b. of the Atomic En5 ergy Act of 1954;

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

7 uranium enriched to 20 percent or more in the iso8 tope U–235;

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

10 Atomic Energy Agency;

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

12 safeguards set forth in an agreement between a

13 country and the International Atomic Energy Agen14 cy, as authorized by Article III(A)(5) of the Statute

15 of the International Atomic Energy Agency;

16 (6) the term ‘‘near real time material account17 ancy’’ means a method of accounting for the loca18 tion, quantity, and disposition of special fissionable

19 material at facilities that store or process such mate20 rial, in which verification of peaceful use is continu21 ously achieved by means of frequent physical inven22 tories and the use of in-process instrumentation;

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

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

25 defined by Article IX (3) of the Treaty on the Non-
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1 Proliferation of Nuclear Weapons, signed at Wash2 ington, London, and Moscow on July 1, 1968;

3 (8) the term ‘‘nuclear explosive device’’ means

4 any device, whether assembled or disassembled, that

5 is designed to release in one microsecond or less an

6 amount of nuclear energy from special nuclear mate7 rial that is greater than the amount of energy that

8 would be released from the detonation of one pound

9 of trinitrotoluene (TNT);

10 (9) the term ‘‘special fissionable material’’, as

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

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

13 International Atomic Energy Agency, done at the

14 Headquarters of the United Nations on October 26,

15 1956;

16 (10) the term ‘‘special nuclear material’’ has

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

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

19 (11) the term ‘‘Treaty’’ means the Treaty on

20 the Non-Proliferation of Nuclear Weapons, signed at

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

22 and

23 (12) the term ‘‘unsafeguarded special nuclear

24 material’’ means special nuclear material which is

25 held in violation of IAEA safeguards or is not sub-
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1 ject to IAEA safeguards, and does not include any

2 quantity of material that could, if it were exported

3 from the United States, be exported under a general

4 license issued by the Nuclear Regulatory Commis5 sion.

6 TITLE I—REPORTING ON

7 NUCLEAR EXPORTS

8 SEC. 101. REPORTS OF THE PRESIDENT.

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

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

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

12 the semicolon;

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

14 inserting ‘‘; and’’; and

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

16 new paragraph:

17 ‘‘(6) a description of the implementation of nu18 clear export controls in the preceding calendar year,

19 including a summary by type of commodity, by value

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

21 ‘‘(A) any transactions for which—

22 ‘‘(i) a license was issued for the ex23 port or retransfer of any good controlled

24 under section 309(c) of the Nuclear Non25 Proliferation Act of 1978;
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1 ‘‘(ii) a license was issued for the ex2 port or retransfer of any good controlled

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

4 ‘‘(iii) an authorization was made as

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

6 Act to engage, directly or indirectly, in the

7 production of special nuclear material; and

8 ‘‘(B) each instance in which—

9 ‘‘(i) a sanction has been imposed

10 under section 201(a) of the Omnibus Nu11 clear Proliferation Control Act of 1993,

12 section 670(b)(1) of the Foreign Assist13 ance Act of 1961, or section 601 or 602 of

14 the Federal Deposit Insurance Corporation

15 Improvement Act of 1991;

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

17 under section 3(f) of the Arms Export

18 Control Act or a transaction prohibited by

19 reason of any act relating to proliferation

20 of nuclear explosive devices, as described in

21 section 40(d) of that Act;

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

23 by reason of section 201(c)(2) of the Om24 nibus Nuclear Proliferation Control Act of

25 1993 or the imposition of a sanction has
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1 been delayed under section 670(b)(4) of

2 the Foreign Assistance Act of 1961; or

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

4 made under—

5 ‘‘(I) section 201(f) of the Omni6 bus Nuclear Proliferation Control Act

7 of 1993,

8 ‘‘(II) section 620E(d), or para9 graph (5) or (6) of section 670(b), of

10 the Foreign Assistance Act of 1961,

11 ‘‘(III) section 605 of the Federal

12 Deposit Insurance Corporation Im13 provement Act of 1991,

14 ‘‘(IV) section 40(g) of the Arms

15 Export Control Act with respect to

16 the last sentence of section 40(d) of

17 that Act, or

18 ‘‘(V) section 614 of the Foreign

19 Assistance Act of 1961 with respect to

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

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

22 section 40(d), of the Arms Export

23 Control Act.’’.
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1 TITLE II—SANCTIONS FOR

2 NUCLEAR PROLIFERATION

3 SEC. 201. IMPOSITION OF SANCTIONS.

4 (a) DETERMINATION BY THE PRESIDENT.—

5 (1) IN GENERAL.—Except as provided in sub6 section (b)(2), the President shall impose the appli7 cable sanctions described in subsection (c) if the

8 President determines that a foreign person or a

9 United States person, on or after the date of enact10 ment of this Act, has materially and with requisite

11 knowledge contributed—

12 (A) through the export from the United

13 States of any goods or technology that are sub14 ject to the jurisdiction of the United States, or

15 (B) through the export from any other

16 country of any goods or technology that would

17 be, if they were exported from the United

18 States, subject to the jurisdiction of the United

19 States,

20 to the efforts by any individual, group, or non-nu21 clear-weapon state to acquire unsafeguarded special

22 nuclear material or to use, develop, produce, stock23 pile, or otherwise acquire any nuclear explosive de24 vice, whether or not the goods or technology is spe25 cifically designed or modified for that purpose.
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1 (2) PERSONS AGAINST WHICH SANCTIONS ARE

2 TO BE IMPOSED.—Sanctions shall be imposed pursu3 ant to paragraph (1) on—

4 (A) the foreign person or United States

5 person with respect to which the President

6 makes the determination described in that para7 graph;

8 (B) any successor entity to that foreign

9 person or United States person;

10 (C) any foreign person or United States

11 person that is a parent or subsidiary of that

12 person if that parent or subsidiary materially

13 and with requisite knowledge assisted in the ac14 tivities which were the basis of that determina15 tion; and

16 (D) any foreign person or United States

17 person that is an affiliate of that person if that

18 affiliate materially and with requisite knowledge

19 assisted in the activities which were the basis of

20 that determination and if that affiliate is con21 trolled in fact by that foreign person.

22 (3) OTHER SANCTIONS AVAILABLE.—The sanc23 tions which are required to be imposed for activities

24 described in this subsection are in addition to any
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1 other sanction which may be imposed for the same

2 activities under any other provision of law.

3 (4) DEFINITION.—For purposes of this sub4 section, the term ‘‘requisite knowledge’’ means situa5 tions in which a person ‘‘knows’’, as ‘‘knowing’’ is

6 defined in section 104 of the Foreign Corrupt Prac7 tices Act of 1977 (15 U.S.C. 78dd–2), and includes

8 situations in which a person has reason to know.

9 (b) CONSULTATION WITH AND ACTIONS BY FOREIGN

10 GOVERNMENT OF JURISDICTION.—

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

12 determination described in subsection (a)(1) with re13 spect to a foreign person, the Congress urges the

14 President to initiate consultations immediately with

15 the government with primary jurisdiction over that

16 foreign person with respect to the imposition of

17 sanctions pursuant to this section.

18 (2) ACTIONS BY GOVERNMENT OF JURISDIC19 TION.—In order to pursue such consultations with

20 that government, the President may delay imposition

21 of sanctions pursuant to this section for up to 90

22 days. Following these consultations, the President

23 shall impose sanctions unless the President deter24 mines and certifies to the Congress that that govern25 ment has taken specific and effective actions, includ-
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1 ing appropriate penalties, to terminate the involve2 ment of the foreign person in the activities described

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

4 imposition of sanctions for up to an additional 90

5 days if the President determines and certifies to the

6 Congress that that government is in the process of

7 taking the actions described in the preceding sen8 tence.

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

10 days after making a determination under subsection

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

12 on Foreign Relations and the Committee on Govern13 mental Affairs of the Senate and the Committee on

14 Foreign Affairs of the House of Representatives a

15 report on the status of consultations with the appro16 priate government under this subsection, and the

17 basis for any determination under paragraph (2) of

18 this subsection that such government has taken spe19 cific corrective actions.

20 (c) SANCTIONS.—

21 (1) DESCRIPTION OF SANCTIONS.—The sanc22 tions to be imposed pursuant to subsection (a)(1)

23 are, except as provided in paragraph (2) of this sub24 section, that the United States Government shall not

25 procure, or enter into any contract for the procure-
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1 ment of, any goods or services from any person de2 scribed in subsection (a)(2).

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

4 required to apply or maintain sanctions under this

5 section—

6 (A) in the case of procurement of defense

7 articles or defense services—

8 (i) under existing contracts or sub9 contracts, including the exercise of options

10 for production quantities to satisfy require11 ments essential to the national security of

12 the United States;

13 (ii) if the President determines that

14 the person or other entity to which the

15 sanctions would otherwise be applied is a

16 sole source supplier of the defense articles

17 or services, that the defense articles or

18 services are essential, and that alternative

19 sources are not readily or reasonably avail20 able; or

21 (iii) if the President determines that

22 such articles or services are essential to the

23 national security under defense

24 coproduction agreements;
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1 (B) to products or services provided under

2 contracts entered into before the date on which

3 the President publishes his intention to impose

4 the sanctions;

5 (C) to—

6 (i) spare parts which are essential to

7 United States products or production;

8 (ii) component parts, but not finished

9 products, essential to United States prod10 ucts or production; or

11 (iii) routine servicing and mainte12 nance of products, to the extent that alter13 native sources are not readily or reason14 ably available;

15 (D) to information and technology essen16 tial to United States products or production; or

17 (E) to medical or other humanitarian

18 items.

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

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

21 consultation, issue an advisory opinion in writing to that

22 person as to whether a proposed activity by that person

23 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. 202. 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(8) of the Omnibus Nuclear Proliferation Control
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1 Act of 1993) and unsafeguarded special nuclear material

2 (as defined in section 3(12) 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(8) of the Om21 nibus Nuclear Proliferation Control Act of 1993;

22 and

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

24 material’ has the meaning given that term in section
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1 3(12) of the Omnibus Nuclear Proliferation Control

2 Act of 1993.’’.

3 (b) AMENDMENTS TO THE FOREIGN ASSISTANCE

4 ACT OF 1961.—

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

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

7 the first sentence—

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

9 ‘‘President’’; and

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

11 after ‘‘certifies in writing’’.

12 (2) Notwithstanding any other provision of law,

13 Presidential Determination No. 82–7 of February

14 10, 1982, shall have no force or effect with respect

15 to any grounds for the prohibition of assistance

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

17 after the date of enactment of this Act.

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

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

20 as follows:

21 ‘‘(d) The President may waive the prohibitions of sec22 tion 669 of this Act with respect to any grounds for the

23 prohibition of assistance under that section arising before

24 the date of enactment of the Omnibus Nuclear Prolifera25 tion Control Act of 1993 to provide assistance to Pakistan
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1 if he determines that to do so is in the national interest

2 of the United States.’’.

3 SEC. 203. ROLE OF INTERNATIONAL FINANCIAL INSTITU4 TIONS.

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

6 shall instruct the United States executive director to each

7 of the international financial institutions described in sec8 tion 701(a) of the International Financial Institutions Act

9 (22 U.S.C. 262d(a)) to use the voice and vote of the

10 United States to oppose any direct or indirect use of the

11 institution’s funds to promote the acquisition of

12 unsafeguarded special nuclear material or the develop13 ment, stockpiling, or use of any nuclear explosive device

14 by any non-nuclear-weapon state.

15 (b) DUTIES OF UNITED STATES EXECUTIVE DIREC16 TORS.—Section 701(b)(3) of the International Financial

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

18 read as follows:

19 ‘‘(3) whether the recipient country—

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

21 seeking to acquire unsafeguarded special nu22 clear material (as defined in section 3(12) of

23 the Omnibus Nuclear Proliferation Control Act

24 of 1993) or a nuclear explosive device (as de25 fined in section 3(8) of that Act);
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1 ‘‘(B) is not a State Party to the Treaty on

2 Non-Proliferation of Nuclear Weapons; or

3 ‘‘(C) has detonated a nuclear explosive de4 vice; and’’.

5 SEC. 204. AMENDMENT TO THE INTERNATIONAL EMER6 GENCY ECONOMIC POWERS ACT.

7 Section 202 of the International Emergency Eco8 nomic Powers Act (50 U.S.C. 1701) is amended by adding

9 at the end thereof the following new subsection:

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

11 unusual and extraordinary threat’ includes any inter12 national event that the President determines may involve

13 the detonation of a nuclear explosive device (as defined

14 in section 3(8) of the Omnibus Nuclear Proliferation Con15 trol Act of 1993) or an action or activity that substantially

16 contributes to the likelihood of the proliferation or detona17 tion of such devices, including the acquisition by a non18 nuclear-weapon state of unsafeguarded special nuclear

19 material (as defined in section 3(12) of that Act).’’.

20 SEC. 205. AMENDMENT TO THE FEDERAL DEPOSIT INSUR21 ANCE CORPORATION IMPROVEMENT ACT OF

22 1991.

23 The Federal Deposit Insurance Corporation Improve24 ment Act of 1991 is amended by adding at the end the

25 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 201(a) of the

15 Omnibus Nuclear Proliferation Control 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 201 of the Omnibus Nuclear Proliferation Con25 trol Act 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 201(g) of the Omnibus Nuclear Prolifera6 tion Control Act of 1993.’’.

7 SEC. 206. 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(8) of the Omnibus Nuclear Proliferation

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

13 aided or abetted any non-nuclear-weapon state (as defined

14 in section 3(7) of that Act) to acquire any such nuclear

15 explosive device or to acquire unsafeguarded special nu16 clear material (as defined in section 3(12) of that Act).’’.

17 SEC. 207. 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 Omnibus

6 Nuclear Proliferation Control 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(8) of the Omnibus Nuclear Pro16 liferation Control 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. 208. 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(12) of the Omnibus Nuclear Prolifera8 tion Control Act of 1993) or any nuclear explosive

9 device (as defined in section 3(8) of that Act) by an

10 individual or group.’’.

11 SEC. 209. 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(8) of the Omnibus

3 Nuclear Proliferation Control Act of 1993) by non4 nuclear-weapon states (as defined in section 3(7) of

5 that Act) or the acquisition by such states of

6 unsafeguarded special nuclear material (as defined

7 in section 3(12) 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. 210. 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 III—INTERNATIONAL

14 ATOMIC ENERGY AGENCY

15 SEC. 301. 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 an acquire

2 a 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. 302. 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. 303. REPORTING REQUIREMENT.

13 (a) REPORT REQUIRED.—Not later than 12 months

14 after the date of enactment of this Act, the President shall

15 submit to the congressional committees specified in section

16 602(c) of the Nuclear Non-Proliferation Act of 1978 (27

17 U.S.C.3282(c)) a report describing—

18 (1) the steps he has taken to implement sec19 tions 301 and 302, and

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

21 obstacles that have been encountered in seeking to

22 meet the objectives set forth in sections 301 and

23 302.

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

25 paragraph (1) shall describe—
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1 (1) the bilateral and multilateral initiatives that

2 the President has taken during the period since the

3 enactment of this Act in pursuit of each of the ob4 jectives set forth in sections 301 and 302;

5 (2) any obstacles that have been encountered in

6 the pursuit of those initiatives;

7 (3) any additional initiatives that have been

8 proposed by other countries or international organi9 zations to strengthen the implementation of IAEA

10 safeguards;

11 (4) all activities of the Federal Government in

12 support of the objectives set forth in sections 301

13 and 302;

14 (5) any recommendations of the President on

15 additional measures to enhance the effectiveness of

16 IAEA safeguards; and

17 (6) any initiatives that the President plans to

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

19 sections 301 and 302.

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