Proposal for a Council Decision issuing directives to the Commission for the re-negotiation of the Agreement between the European Atomic Energy Community (Euratom) and the Government of Canada for cooperation in the peaceful uses of atomic energy
Date: 2008-10-17
Institutions: European Commission
Subjects: Canada, EAEC, cooperation agreement (EU), nuclear energy, peaceful use of energy

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 17.10.2008 
COM(2008) 658 final 

Proposal for a 

COUNCIL DECISION 

issuing directives to the Commission for the re-negotiation of the Agreement between 
the European Atomic Energy Community (Euratom) and the Government of Canada 
for cooperation in the peaceful uses of atomic energy 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

Introduction 

The  Agreement  between  the  European  Atomic  Energy  Community  (Euratom),  hereinafter 
referred  to  as  "the  Community",  and  the  Government  of  Canada  for  cooperation  in  the 
peaceful  uses  of  atomic  energy  was  signed  in  19591.  An  increased  relationship  between  the 
Community  and  Canada  has  required  a  continuous  update  of  the  Agreement  in  order  to 
provide  a  more  stable  and  administratively  effective  legal  framework  for  this  cooperation. 
Consequently, the Agreement was amended several times2.  

The existence of this bilateral cooperation framework is relevant for the EU. Indeed, Canada 
is the world’s largest uranium producing country (23 % of world production in 2007), and it 
has been for years the main supplier of natural uranium to the EU, accounting for 20–25 % of 
EU  supplies.  Canadian  uranium  production  is  set  to  increase  further  as  a  result  of  ongoing 
mine  development  and  exploration  activity,  and  the  EU  industry  is  a  major  shareholder  in 
many of the uranium mines in Canada. 

In  addition,  the  Canadian  nuclear  industry  is  an  important  supplier  of  uranium  conversion 
services and reactor technology to the EU. 

The Agreement concerns mainly the supply of nuclear material and exchange of information. 
It  also  covers  the  procurement  of  equipment  and  devices,  the  use  of  intellectual  property 
rights as well as access to and use of equipment and facilities. Through the 1991 amendment, 
its scope was completed by including the transfer and use of tritium and related equipment, 
necessary for the fusion research programme of the Community. 

Articles  and  amendments  related  to  trade  of  nuclear  items  contain  several  important 
provisions that ensure necessary framework of the bilateral cooperation, in particular by  

–  ensuring that both the Community and the Government of Canada undertake that 
re-exports  of  nuclear  material  and  equipment  as  well  as  their  derivatives,  are 
subject to peaceful uses; 

–  committing the Community, its Member States and the Government of Canada to 
non-proliferation  and  defining  nuclear  non-proliferation  conditions  governing 
transfers of nuclear material; 

–  recognising  the  role  of  the  International  Atomic  Energy  Agency  and  taking  into 
account the  commitments of both  Parties towards the  mentioned Agency and  its 
derived International Conventions. 

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Agreement  between  the  Government  of  Canada  and  the  European  Atomic  Energy  Community 
(Euratom) for co-operation in the peaceful uses of atomic energy signed on 6 October 1959 (OJ No.59 
of 24.11.59, pp. 1165-1180) 
–Amendment to the Agreement in the form of an exchange of letters of 16 January 1978 (OJ L 65 of 
8.3.78, pp. 16-32) 
–Agreement in the form of an exchange of letters of 18 December 1981 (OJ L 27 of 4.2.82, pp. 25-30) 
–Agreement in the form of an exchange of letters of 21 June 1985 (OJ C 191 of 31.7.85, pp. 3-6) 
–Agreement in the form of an exchange of letters of 15 July 1991 (OJ C 215 of 17.8.91, pp. 5-8) 
–Note verbal of 29 April 1996 adding Switzerland to the retransfer mechanism for tritium.  

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Besides this Agreement, a technical agreement3 between both Parties was signed on the same 
date. Its aim was to establish a joint research and development programme centred on heavy 
water reactors. The validity of this technical agreement ended on 31.12.1964. Cooperation in 
nuclear  research  is  now  ongoing  within  the  framework  of  the  Agreement  signed  by  the 
Community and Canada in 19984. 

2. 

The difficulties encountered in the application of the Agreement 

While the Agreement covers most fields of mutual interest, the successive modifications make 
it  uneasy  to  read  and  cumbersome  to  implement.  In  addition,  the  enlargement  of  the 
Community implies the review and folding-in of the new Member States' bilateral agreements 
with Canada to the Community – Government of Canada Agreement.  

3. 

Current status 

Since  few  years,  the  European  Commission  has  undertaken  a  simplification  exercise 
covering  all  legislative  documents.  The  simplification  of  the  Community  –  Government  of 
Canada Agreement is part of this exercise. 

There  are  several  formal  provisions  that  require  revision  in  depth,  due  to  their  obsolete 
character.  

Besides, due to the increasing importance of the International Conventions to which both the 
Community  and  Canada  are  Contracting  Parties,  the  Agreement  shall  make  reference  to  the 
commitments made in the framework of:  

–  The status of the Community, its Member States and of Canada within the IAEA, 
and  the  commitments  included  in  the  Conventions  concluded  under  the  IAEA 
auspices; 

–  the Nuclear Suppliers Group. 

In this context, it should be underlined that Canada has sent a diplomatic note5 confirming 
that  it  is  in  favour  of  such  simplification,  provided  that  additional  provisions  (in 
particular  technology  transfer)  could  be 
the 
simplification  and  standardisation  of  Canada's  nuclear  relations  with  all  EU  Member  States 
mainly  by  the  progressive  reduction  or  elimination  of  the  bilateral  nuclear  cooperation 
agreements  of  Canada  with  the  respective  EU  Member  States.  The  inclusion  of  technology 
transfer  may  necessitate  an  annex  on  Intellectual  Property  rights.  In  another  note6,  the 
Department of Foreign Affairs and International Trade of Canada informed the Commission 
that it will seek for a negotiating mandate from the Canadian Cabinet of Ministers to revise 
this  Agreement  to  include,  inter  alia,  provisions  covering  the  transfer  of  technology  and 
invited the Commission to seek for a similar negotiating mandate. 

incorporated.  This  would  permit 

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Technical  Agreement  between  Atomic  Energy  of  Canada  Limited  and  the  European  Atomic  Energy 
Community  (Euratom)  concerning  peaceful  uses  of  atomic  energy  of  6  October  1959  (OJ  No.  060, 
24.11.1959 pp. 1177) 
Agreement between the European Atomic Energy Community and Canada for cooperation in the area 
of nuclear research (OJ L 346 of 22.12.1998, pp. 65–71) 
Note of 21 March 2007  
Note of 6 June 2008 

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For  the  Commission,  the  inclusion  of  these  new  provisions  are  important  due  to  the  latest 
enlargement  of  the  Community,  where  one  of  the  new  Member  States  -  Romania  -  has  a 
CANDU  type  reactor.  The  bilateral  agreement  between  Romania  and  Canada  comprises 
provisions on equipment and technology transfer, as well as contamination from their use. 

Besides,  technology  transfer  provisions  are  also  present  in  Finland,  Sweden  and  Spain 
bilateral agreements or administrative arrangements with the Government of Canada. 

Technical  discussions  have  taken  place  between  the  Commission  and  Canadian  authorities 
(Canadian  Nuclear  Safety  Commission)  aiming  to  prepare  the  ground  for  possible 
simplifications.  During  these  meetings,  the  Canadian  authorities  reiterated  recasting  that 
would  permit  the  inclusion  of  additional  provisions  (mainly  technology  transfer  and  the 
contamination principle that are of utmost political importance for Canada). 

Canada also wishes to have separate agreements related to the peaceful uses of nuclear energy 
on  the  one  hand  and  research  and  development,  on  the  other  hand.  This  would  be  in 
conformity with the existing cooperation framework, since in practice solely tritium for fusion 
research and related equipment are covered by the present Agreement. Cooperation related to 
research  and  development  is  mainly  implemented  through  the  previously  mentioned 
Agreement on research. 

4. 

The main objectives of the current re-negotiation process 

In view of the existing difference of scopes of the bilateral agreements between various EU 
Member States and Canada, it appears necessary to revise the existing Agreement and include 
provisions on technology transfer and contamination from technology transfer and equipment. 
However,  the  Commission  believes  that  in  order  to  guarantee  a  fair  implementation,  these 
provisions should be limited to substantial items. 

The  Agreement  must  also  ensure  the  free  movement  of  nuclear  materials,  materials, 
equipment and technology within the Community. 

The  Agreement  should  require  that  transfers  of  nuclear  material  and  provisions  of  relevant 
services be carried out at market-related prices and under fair market conditions. 

5. 

Conclusion 

The  Commission  proposes  that  the  Council  adopts  the  decision  hereafter,  authorising  the 
Commission  to  re-negotiate  a  comprehensive  nuclear  cooperation  agreement  with  the 
Government of Canada in accordance with the enclosed negotiating directives. 

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Proposal for a 

COUNCIL DECISION 

issuing directives to the Commission for the re-negotiation of the Agreement between 
the European Atomic Energy Community (Euratom) and the Government of Canada 
for cooperation in the peaceful uses of atomic energy 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Atomic  Energy  Community,  and  in 
particular the second paragraph of Article 101 thereof, 

Having regard to the existing Agreement between the European Atomic Energy Community 
and the Government of Canada for cooperation in the peaceful uses of atomic energy, signed 
in 1959 and its subsequent amendments7; 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

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there  is  a  continuous  development  of  co-operation  in  nuclear  matters  (in  particular 
trade) between the European Atomic Energy Community and Canada, 

the existing Agreement covers trade in nuclear materials, equipment and devices, the 
use of intellectual property rights, exchange of information, as well as transfer and use 
of  tritium  and  related  equipment  for  the  fusion  programme  of  the  European  Atomic 
Energy Community, 

this existing Agreement has proved efficient in establishing a cooperation framework 
in the peaceful uses of atomic energy, 

this existing Agreement was amended several times,  

in  the  context  of  the  latest  technological  developments,  Canada  and  the  European 
Atomic  Energy  Community  would  like  to  include  new  provisions  to  the  existing 
Agreement, thus extending its scope of co-operation, 

a  recast  version  of  the  existing  Agreement,  taking  into  account  all  the  above,  is 
necessary for achieving simplification, easier implementation and further development 
of nuclear relations between the European Atomic Energy Community and Canada, 

–The Agreement signed on 6 October 1959 (OJ No.59 of 24.11.59, pp. 1165-1180) 
–Amendment to the Agreement in the form of an exchange of letters of 16 January 1978 (OJ L 65 of 
8.3.78, pp. 16-32) 
–Agreement in the form of an exchange of letters of 18 December 1981 (OJ L 27 of 4.2.82, pp. 25-30) 
–Agreement in the form of an exchange of letters of 21 June 1985 (OJ C 191 of 31.7.85, pp. 3-6) 
–Agreement in the form of an exchange of letters of 15 July 1991 (OJ C 215 of 17.8.91, pp. 5-8) 
–Note verbal of 29 April 1996 adding Switzerland to the retransfer mechanism for tritium. 

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HAS ADOPTED THIS DECISION:  

Sole Article 

The Commission is hereby mandated to re-negotiate, in accordance with directives contained 
in  the  Annex,  the  Agreement  between  the  European  Atomic  Energy  Community  and  the 
Government of Canada for cooperation in the peaceful uses of atomic energy. 

Done at Brussels,  

For the Council 
The President 

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ANNEX  

Negotiating Directives for re-negotiation of the Agreement between  
the European Atomic Energy Community (Euratom) and the Government of Canada  
for cooperation in the peaceful uses of atomic energy 

This  Agreement  shall  be  based  on  the  provisions  of  the  existing  Agreement  between  the 
European Atomic Energy Community (Euratom), hereinafter referred to as "the Community", 
and the Government of Canada for cooperation in the peaceful uses of atomic energy, signed 
on  6  October  1959.  With  the  aim  of  simplification,  it  will  repeal  outdated  provisions  and 
consolidate  the  main  text  with  its  annexes.  In  order  to  respond  to  the  most  recent 
developments, like the enlargements of the Community, the new Agreement will also include 
additional  provisions,  considered  as  of  utmost  importance  by  the  concerned  EU  Member 
States and the Government of Canada. 

1. 

Simplification exercise  

The main task of the simplification exercise consists of incorporating amendments to the main 
text, updating information and including provisions aiming to offer a better understanding of 
the  text  (for  example,  addition  of  definitions  explaining  terms  such  as  "the  Community"  or 
"appropriate authority" etc.). 

In  the  context  of  the  recent  enlargement  of  the  Community  as  well  as  due  to  continuous 
developments in the Community - Canada cooperation, certain provisions need to be deleted 
or updated, such as: 

The  enumeration  of  the  Member  States  in  the  Preamble  should  be  deleted.  The 
(a) 
existing Agreement makes a clear reference to the founding countries of the Community. In 
the  context  of  the  enlargement  of  the  Community,  the  new  Agreement  should  delete 
references to particular countries, unless it is of specific importance. Instead it should refer to 
the "Community and its Member States", when necessary. 

(b) 
The  general  reference  to  the  joint  programme  of  research  and  development  in  the 
Preamble should be replaced by the reference to the cooperation agreement in research signed 
in 1998. 

(c) 

The terminological definitions have to be updated as necessary. 

The  duration  of  the  agreement  has  to  be  reviewed.  Following  the  agreed  period  of 
(d) 
duration  (for  example  ten  years),  the  Agreement  should  be  automatically  renewed  for  equal 
additional periods. Termination by either Party should be possible after the initial period, with 
a six months notice to the other Party. 

The text has to be reorganised in a coherent and readable way, providing titles to the 

(e) 
articles of the Agreement. 

(f) 
An  explicit  mention  of  the  Treaty  establishing  the  European  Atomic  Energy 
Community  (hereinafter  referred  as  "Euratom  Treaty")  has  to  be  introduced,  instead  of  the 
existing reference to the "Treaty signed at Rome".  

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The  Preamble  should  make  clear  references  to  the  Community  and  Canada 

(g) 
commitments towards:  

–  the IAEA and the respective safeguards agreements 

–  the Treaty on the Non-Proliferation of Nuclear Weapons 

–  the Nuclear Suppliers Group 

–  the Agreement between Canada and the European Atomic Energy Community for 

cooperation in the area of nuclear research signed in 1998  

The  Agreement  should  not  impede  a  free  movement  of  nuclear  material,  equipment 

(h) 
and technology within the Community. 

The Agreement should require that transfers of nuclear material and the provision of 

(i) 
relevant services be carried out at market-related prices and under fair market conditions. 

2. 

Update of international commitments of both Parties 

Transfers under the Agreement should be subject to the following conditions: 

Peaceful  and  non-explosive  purposes;  any  use  for  research  or  development  of  any 

(a) 
nuclear explosive device would be specifically excluded; 

(b) 

The nuclear material should be subject: 

(1) 

In the Community, to the Euratom safeguards pursuant to the Euratom Treaty 
and to the IAEA safeguards pursuant to the following safeguards agreements, 
as relevant, and as they may be revised and replaced, so long as coverage as 
required by the Non-Proliferation Treaty is provided for: 

–  The  Agreement  between  the  Community's  non-nuclear  weapon  Member  States, 
European  Atomic  Energy  Community  and  the  International  Atomic  Energy 
Agency,  which  entered  into  force  on  21  February  1977  (published  as 
INFCIRC/193) 

–  The  Agreement  between  France,  Euratom  Atomic  Energy  Community  and  the 
International Atomic Energy Agency, which entered into force on 12 September 
1981 (published as INFCIRC/290) 

–  The  Agreement  between  the  United  Kingdom,  European  Atomic  Energy 
Community  and  the  International  Atomic  Energy  Agency,  which  entered  into 
force on 14 August 1978 (published as INFCIRC/263); 

Supplemented by Additional Protocols concluded on 22 September 1998 on the basis 
of the document published as INFCIRC/540 (Strengthened Safeguards System, Part 
II) and entered into force on 30 April 2004. 

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(2) 

In  Canada,  to  the  IAEA  safeguards  pursuant  to  the  Agreement  between 
Canada  and  the  International  Atomic  Energy  Agency  for  the  Application  of 
Safeguards in connection with the Treaty on the Non-Proliferation of Nuclear 
Weapons,  which  entered  into  force  on  21  February  1972  (published  as 
INFCIRC/164);  supplemented  by  an  Additional  Protocol  concluded  on 
24.09.1998  on  the  basis  of  the  document  published  as  INFCIRC/164/Add.1 
(Strengthened  Safeguards  System,  Part  II)  and  entered  into  force  on  8 
September 2000. 

(c) 
In the event of the application of any of the Agreements with the IAEA referred to in 
subparagraph  b)  being  suspended  or  terminated  for  any  reason  within  the  Community  or 
Canada, the relevant Party should enter into an agreement with the IAEA which provides for 
effectiveness and coverage equivalent to that provided by the safeguards agreements referred 
to in provisions (1) or (2) of subparagraph b), or, if that is not possible, 

-  the  Community,  as  far  as  it  is  concerned,  should  apply  safeguards  based  on  the  Euratom 
safeguards system, which provides for effectiveness and coverage equivalent to that provided 
by the safeguards agreements referred to in provision (1) of subparagraph b) or, if that is not 
possible, 

- the Parties should enter into arrangements for the application of safeguards, which provide 
for  effectiveness  and  coverage  equivalent  to  that  provided  by  the  safeguards  agreements 
referred to in provisions (1) or (2) of subparagraph b). 

(d) 
Application of physical protection measures at levels which satisfy as a minimum the 
criteria  set  out  in  Annex  C  to  IAEA  document  INFCIRC/254/Rev.9/Part  1  (Guidelines  for 
Nuclear Transfers) as it may be revised; supplementary to this document, the Member States 
of  the  Community,  the  European  Commission,  as  appropriate,  and  Canada  will  refer  when 
applying  physical  protection  measures  to  the  recommendations  in  IAEA  document 
INFCIRC/225/Rev.4 corrected (Physical Protection of Nuclear Material) as it may be revised. 
International transport shall be subject to the provisions of the International Convention on the 
Physical Protection of Nuclear Material (IAEA document INFCIRC/274/Rev.1), as it may be 
revised  and,  as  soon  as  possible,  to  the  IAEA  Regulations  for  the  Safe  Transport  of 
Radioactive Materials (IAEA Safety Standards Series No. TS-R-1, as they may be revised). 

(e) 
Retransfers  of  any  items  subject  to  this  Agreement  outside  the  jurisdiction  of  the 
Parties shall only be made under the framework of the commitments undertaken by individual 
Member States of the Community and Canada within the group of nuclear supplier countries 
known as the Nuclear Suppliers Group. In particular, the Guidelines for Nuclear Transfers, as 
set out in IAEA document INFCIRC/254/Rev.9/Part 1, as it may be revised, should apply to 
retransfers of any items subject to this Agreement. 

Retransfers  of  tritium  and  equipment  or  technology  related  to  tritium  outside  the 

(f) 
territories of the Contracting Parties are subject to prior written consent of the relevant Party. 

The  Agreement  should  not  jeopardise  the  international  obligations  of  the  European 

(g) 
Communities under the World Trade Organisation. 

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3. 

Inclusion of new provisions 

The inclusion of technology transfer can be done provided that its scope is limited to 

(a) 
substantial items to be agreed between the Parties. 

(b)  The  inclusion  of  the  contamination  principle8  from  equipment  transferred  and  from 
equipment  produced  from  technology  transferred,  provided  that  the  scope  of  the  latter  is 
limited to substantial items, to be agreed between the Parties. 

The inclusion of technology transfer in the Agreement will affect several articles, i.e. 

(c) 
Definitions, Scope of cooperation, international transfers, trade in nuclear materials. 

Inclusion  of  a  provision  requesting  the  written  consent  of  both  Parties  prior  to  the 
(d) 
enrichment  of  a  nuclear  material  beyond  20  per  cent  in  the  isotope  U  235  and  to  the 
reprocessing  of  such  nuclear  material  subject  to  the  Community  –  Government  of  Canada 
Agreement.  

Clearly  regulating  the  situations  when  nuclear  material,  material,  equipment  and 

(e) 
technology are no longer subject to this Agreement. 

(f) 
Ensuring that the cooperation provided in this Agreement shall be in accordance with 
the Euratom Treaty and its secondary legislation, as well as with the international agreements 
which are in force for the Parties. 

Inclusion of clauses providing for procedures (consultation and arbitration) applicable 

(g) 
in case of any dispute arising out of the interpretation or application of this Agreement.  

(h) 

Inclusion of a provision establishing administrative arrangements. 

(i) 
Inclusion  of  a  provision  defining  actions  to  be  taken  in  case  of  violation  of  the 
Agreement.  Pending  on  the  gravity  of  violations,  the  cooperation  may  be  suspended  or 
terminated in whole or in part. 

Inclusion  of  a  provision  on  mutual  consultation  related  with  the  fulfilment  of  the 

(j) 
commitments under this Agreement. 

(k) 
Inclusion  of  a  provision  for  exchange  of  information  and/or  cooperation  in  the 
framework of external assistance in the field of nuclear matters (Instrument for Nuclear Safety 
Cooperation, Instrument For Stability, Instrument for Pre-accession Assistance, and other co-
operation programmes). 

8 

In the context of Euratom international agreements, the term "contamination principle" is used to denote 
that  by-products  derived  from  the  use  of  technology,  equipment  or  material  transferred  under  the 
agreement, are also considered as falling under the scope of the agreement.  

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