Proposal for a COUNCIL DECISION on the extension of the joint-undertaking status of Hochtemperatur-Kernkraftwerk GmbH
Date: 2022-11-17
Institutions: Directorate-General for Energy, European Commission
Subjects: EAEC Joint Undertaking, Germany, North Rhine-Westphalia, decommissioning of power stations, nuclear power station, nuclear safety

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 17.11.2022  COM(2022) 598 final 2022/0373 (NLE)  Proposal for a COUNCIL DECISION on the extension of the joint-undertaking status of Hochtemperatur-Kernkraftwerk GmbH  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

HISTORICAL  BACKGROUND  OF  THE  JOINT  UNDERTAKING  STATUS  OF  HKG 
AND THE THTR 300 PROJECT 

The objectives of Hochtemperatur-Kernkraftwerk GmbH (HKG) were to construct, equip and 
operate  a  nuclear  power  station  at  Uentrop  (Unna  district)  in  the  Federal  Republic  of 
Germany.  This  was  to  be  a  prototype  thorium  high-temperature  reactor  with  a  capacity  of 
approximately  300  MWe  (THTR  300).  In  order  to  attain  this  objective,  HKG  applied  for 
establishment as a Joint Undertaking. 

The Council, upon proposal of the Commission, found that HKG's statutes were compatible 
with the provisions of the Euratom Treaty relating to Joint Undertakings and that, at the time, 
HKG's project was of fundamental importance to the development of the nuclear industry in 
the Community and therefore granted HKG Joint Undertaking status for a period of 25 years 
from 1 January 1974. 

HKG also applied for certain advantages listed in Annex III to the Euratom Treaty. 

Considering that: 

– 

– 

– 

– 

the nuclear power station was to be constructed by a consortium of Community 
undertakings and nearly exclusively with components from the Community; 

construction  of  the  power  station  would  allow  considerable  improvements  in 
the technical processes for generating electricity on an industrial scale; 

conferment  on  HKG  of  advantages  listed  in  Annex  III  to  the  Treaty  could 
lighten  the  financial  burden  and  limit  the  economic  risks  inherent  in  such  an 
undertaking; 

HKG was to make available to the Community the non-patentable information 
it  would  collect  in  the  course  of  implementing  the  nuclear  power  station 
project, 

the  Council  decided  to  confer  some  of  the  advantages  listed  in  Annex  III  to  the  Euratom 
Treaty,  in  particular  in  the  form  of  exemption  from  some  taxes.  These  advantages  were 
conferred  for  a  period  ending  three  years  after  final  acceptance  of  the  power  station  by  the 
undertaking. 

Original decisions 

In June 1974 the Council, acting on proposals from the Commission, adopted two decisions: 

– 

– 

Council Decision 74/295/Euratom of 4 June 1974 on the establishment of the 
Joint Undertaking Hochtemperatur-Kernkraftwerk GmbH (HKG)1; 

Council  Decision  74/296/Euratom  of  4  June  1974  on  the  conferring  of 
advantages  on 
the  Hochtemperatur-Kernkraftwerk  GmbH  (HKG)  Joint 
Undertaking2. 

Amendments to the original decisions 

1 
2 

OJ L 165, 20.6.1974, p. 7-13 
OJ L 165, 20.6.1974, p. 14-15 

EN 

1 

  EN 

                                                 
On  11  July  1983  the  general  meeting  of  the  Joint  Undertaking  decided  to  increase  the 
company's  subscribed  capital.  This  increase  called  for  an  amendment  to  the  statutes  of  the 
Joint Undertaking. 

The  Joint  Undertaking  also  requested  an  extension  of 
the 
"Kapitalverkehrsteuer"  conferred  in  1974  on  the  assets  contributed,  in  line  with  the 
abovementioned increase in capital. 

the  exemption  from 

Considering that: 

– 

– 

the  amendment  to  the  statutes  had  no  effect  on  the  provisions  governing  the 
Joint Undertaking and was consistent with the development of the project; 

and  extension  of  the  exemption  could  reduce  financing  expenses  and  thereby 
limit the economic risks inherent in such an undertaking, 

in  February  1984  the  Council  adopted  two  decisions  adapting  the  1974  decisions  to  the 
increase in HKG's capital: 

– 

– 

Council  Decision  84/104/Euratom  of  21  February  1984  approving  an 
amendment to the Statutes of the Joint Undertaking HKG3 

Council  Decision  84/105/Euratom  of  21  February  1984  amending  Decision 
74/296/Euratom  on  the  conferring  of  advantages  on  the  Joint  Undertaking 
HKG4. 

Service record of the power station and reasons for change of objectives 

HKG  finally  brought  THTR  to  commercial  operation  on  1  June  1987.  The  power  station 
operated until 29 September 1988, when it was shut down. During that period operations were 
interrupted on a number of occasions due to faults. 

Economic,  technical  and  fuel  element  supply  difficulties,  combined  with  problems  in 
obtaining  authorisation  to  restart  the  plant  due  to  financial  uncertainties,  resulted  in  the 
decision, taken on 1 September 1989, immediately to shut down the plant definitively. 

Since  then  the  Joint  Undertaking's  objectives  have  become:  shutdown  of  the  reactor,  core 
unloading,  construction  of  the  safe  enclosure  and  surveillance.  On  13  December  1989  a 
contract on controlled decommissioning of the THTR 300 project was concluded between the 
Federal  authorities,  the  Land  of  North  Rhine-Westphalia,  HKG  and  its  members.  This 
included provisions on the financial aspects. 

Consequent further applications by HKG 

The tax advantages conferred on HKG by Decision 74/296/Euratom expired on 31 May 1990, 
three years after final acceptance of the power station by the undertaking on 1 June 1987. 

By letters of 9 February and 6 March 1990 the members of HKG submitted a request for the 
advantages conferred to be extended until HKG's Joint Undertaking status expired and for the 
advantages  to  be  adjusted  to  the  undertaking's  situation  at  the  time,  which  had  necessitated 
additional financial contributions regarded, for tax purposes, as contributions of assets. 

HKG was implementing a programme for decommissioning the nuclear power station  up to 
the safe enclosure stage and proposed, thereafter, to carry out a programme of surveillance of 
the nuclear installations concerned. 

3 
4 

OJ L 58, 29.2.1984, p. 35 
OJ L 58, 29.2.1984, p. 37 

EN 

2 

  EN 

                                                 
The Council considered that there was no equivalent to these programmes in the Community 
and that implementation thereof was, therefore, important to provide useful experience for the 
nuclear industry and the future development of nuclear energy in the Community. 

The  Council  also  considered  it  advisable  to  assist  HKG  with  implementation  of  the 
programmes  by  lightening  its  financial  burden  and,  therefore,  to  extend  the  advantages 
conferred. 

By Decision of 16 November 1992, the Council extended the advantages conferred to HKG 
until the expiring date of the 74/295/Euratom Decision. 

On 30 March  1998,  HKG applied to  the Commission for extension of its Joint Undertaking 
status for a further 25 years. 

The  reason  given  for  this  request  was  the  importance  of  the  experience  which  would  be 
gained  from  the  definitive  shutdown  and  decommissioning  operations  to  the  nuclear  power 
industry in Germany, Europe and worldwide. This view was based on the fact that THTR 300 
was the largest reactor of its type in the world and that the unique configuration of the plant, 
particularly  with  regard  to  the  enclosure,  provided  an  unprecedented  opportunity  to  acquire 
experience on the results and costs of enclosure. 

HKG  added  that  on  13  November  1989  the  Federal  Republic,  the  Land  of  North  Rhine-
Westphalia,  HKG  and  its  members  had  concluded  a  framework  agreement  with  a  view  to 
completing  the  final  phase  of  the  THTR  300  project.  This  framework  agreement  and  the 
amendment annexed thereto on 18 December 1996 govern the phases up to 2009, including 
the arrangements for financing HKG's activities. 

Germany supported HKG's request and stated that the Federal Government was in favour of 
maintaining the tax advantages granted. 

On  the  basis  of  the  information  received  the  Commission  considered  that  the  arguments 
accepted  by  the  Council  in  1992  were  still  valid;  in  particular,  the  undertaking's  activities 
were still the same and the context in which it performed them was identical. 

However,  as  the  arrangements  concluded  between  the  Federal  Republic,  the  Land  of  North 
Rhine-Westphalia,  HKG  and  its  members  for  financing  HKG's  activities  applied  only  for  a 
period  up  to  31  December  2009,  the  Commission  proposed  that  the  Council,  in  accordance 
with the period arranged between the German authorities and HKG, would approve extension 
of the Joint Undertaking status and of the advantages conferred on HKG for the same period, 
that was until 31 December 2009. 

On  the  basis  of  the  Commission  proposal  the  Council  prolonged  on  7  May  2002  the  Joint 
Undertaking status and the advantages conferred on HKG until 31 December 20095. 

By letter, dated 26 April 2010, Hochtemperatur-Kernkraftwerk GmbH (HKG), Hamm, asked 
for  the  further  extension  of  the  joint-undertaking  status,  established  originally  by  Decision 
74/295/Euratom, which had been already once extended by Council Decision of 7 May 2002, 
for  11  years  with  effect  from  1  January  1999.  This  extension  should  also  include  the 
exemptions from land transfer tax, land tax and trade earnings tax on long-term debt interest, 
which were granted at the same time. 

HKG applied for the existing status to be extended beyond 31 December 2009 for a further 25 
years. In its justification, HKG provided in particular the following arguments: 

5 

OJ L 123, 2002/355/Euratom, 9.5.2002, p. 53; OJ L123, 2002/356/Euratom, 9.5.2002, p. 54 

EN 

3 

  EN 

                                                 
With the Thorium High-Temperature Reactor (THTR) prototype nuclear power plant project 
in Hamm-Uentrop, HKG had undertaken to carry out industrial-scale and economic testing of 
high-temperature  reactor  technology  in  the  interest  of  providing  for  Germany's  future  and 
long-term security of energy supply. 

Knowledge  gathered  from  experience  in  the  generation  of  electricity  from  nuclear  energy 
could  not  be  confined  to  construction  and  operation  alone.  For  the  sake  of  completeness, 
knowledge  accumulated  from  shutdown  planning,  shutdown  itself,  safe  enclosure  operation 
and  decommissioning  (in  this  case,  in  high-temperature  reactor  technology)  should  be 
included. 

In  HKG's  opinion,  knowledge  obtained  during  the  period  of  maintaining  the  safe  enclosure 
(enclosure  time)  and  subsequent  decommissioning  would  be  of  great  importance  to  the 
nuclear industry in  Europe and worldwide, all the more so at a time when high-temperature 
reactor technology was being taken up again in the work on Generation IV and the different 
phases of shutdown were also to be included in obtaining an overall picture (Lifecycle Cost). 

The  THTR  300  plant  was  the  largest  pebble-bed  reactor  in  the  world  with  a  prestressed 
concrete reactor pressure vessel (RCRPV) and built-in ceramic reflector and liner and hot-gas 
duct insulation. 

The  specific  nature  of  the  safely  enclosed  plant  offered  a  hitherto  unique  opportunity  to 
calculate  the  data  and  costs  for  a  'quasi-passive'  safe  enclosure  of  a  plant  with  RCRPV, 
especially  in  the  case  of  energy  costs  (ventilation,  air  drying,  etc),  operating  costs,  periodic 
testing and repairs. 

HKG  expected  important  findings  from  the  eventual  decommissioning  of  the  plant,  from 
remote  and  manual  in-core  decommissioning  work.  In  addition,  stripping  out  the  internal 
surface of the RCRPV (not all tendons could be detensioned unequivocally) and dismantling 
of  550  Mg  of  radiologically  contaminated  ceramic  components  installed  inside  the  RCRPV 
would bring new knowledge on the decommissioning of high-temperature reactors. 

HKG aimed to continue placing these findings too at the disposal of EU Member States. 

It was still unclear when decommissioning could take place – an important factor here was to 
have a suitable repository prepared and ready to receive – and this was why it was asked for 
the joint-undertaking status to be extended by 25 years. 

The prime importance to the development of the nuclear industry in the Community, that was 
necessary  for  granting  of  the  status  of  'European  Joint  Undertaking',  had  already  been 
accepted with the Council Decision of 16 November 1992 on the extension of the advantages 
conferred  on  the  Joint  Undertaking  HKG  –  i.e.,  at  the  time  when  the  THTR  300  plant  was 
shut down. It had also been recognised that no comparable case existed in the Community for 
the  programmes  to  shut  down  the  power  plant  up  to  the  safe  enclosure  phase  and  for 
preserving  and  monitoring  such  a  'safely  enclosed  plant'  condition.  It  had  also  been 
established  that  carrying  out  these  programmes  would  lead  to  useful  experience  for  the 
nuclear industry and the future development of nuclear energy in the Community. 

The  THTR  300  project  would  continue  to  receive  substantial  aid  from  the  German 
Government and the State of North Rhine-Westphalia. This was laid down in the contract on 
controlled  decommissioning  of  the  THTR  300  project  concluded  in  1989,  on  the  basis  of 
which inter  alia the standby operation of the THTR  300 plant after 31 December 2009  was 
being paid for. 

In  its  communication  to  the  European  Commission  the  German  government  supported  the 
request of HKG to extend the status of joint undertaking. However the extension was only to 

EN 

4 

  EN 

be conceded until 31 December 2017 and not for further 25 years as requested by HKG, since 
the German financing arrangements were limited to that date. 

By  its  Decision  of  17  June  2011  on  extension  of  the  joint-undertaking  status  of 
Hochtemperatur-Kernkraftwerk GmbH (HKG) (2011/362/Euratom)6, the Council decided the 
following: 

The  joint-undertaking  status,  within  the  meaning  of  the  Treaty  establishing  the  European 
Atomic  Energy  Community,  granted  to  Hochtemperatur-Kernkraftwerk  GmbH  (HKG)  was 
extended for eight years with effect from 1 January 2010. 

The  objective  of  HKG  was  to  implement  a  programme  for  decommissioning  the  nuclear 
power station  located  at  Uentrop (Unna district) in the  Federal  Republic  of Germany, up to 
the  safe  enclosure  stage  and,  thereafter,  to  carry  out  a  programme  of  surveillance  of  the 
enclosed nuclear installations. 

RECENT DEVELOPMENTS 

By  letter,  dated  7  October  2021,  Hochtemperatur-Kernkraftwerk  GmbH  (HKG),  Hamm, 
asked  for  the  further  extension  of  the  joint-undertaking  status,  established  originally  by 
Decision 74/295/Euratom, which has been already twice extended by Council Decision of 7 
May 2002, for 11 years with effect from 1 January 1999 and by Council Decision of 17 June 
2011 for eight years with effect from 1 January 2010. This extension should also include the 
exemptions from land transfer tax, land tax and trade earnings tax on long-term debt interest, 
which were granted at the same time. In addition, HKG applied to be exempt from all direct 
taxes  to  which  Joint  Undertakings,  their  property,  assets  and  revenue  might  otherwise  be 
liable. It applied for this exemption to be carried out in the most extensive way feasible and to 
be applicable from 1 January 2018 onwards. For reasons of clarity, but not to be understood 
as  an  exhaustive  list,  HKG  sought  exemption  from  the  following  direct  taxes  applicable  in 
Germany: 

– 

– 

– 

– 

– 

Körperschaftsteuer (corporate tax), 

Solidaritätszuschlag (“solidarity surcharge“ to corporate tax) 

Gewerbesteuer (local business tax) 

Grunderwerbsteuer (land transfer tax) 

Grundsteuer (land tax) 

Statement  of  the  German  Government  on  the  request  of  HKG  to  extend  the  status  of 
joint undertaking 

In  its  communications  to  the  European  Commission  of  23  April  2021  and  6  May  2022,  the 
German government supported the request of HKG to extend the status of joint undertaking in 
particular for the following reasons: 

The  safe-enclosure  stage  of  the  THTR  will  extend  beyond  the  period  currently  planned  for. 
This  stage  is  financially  secured  by  contractual  arrangements  between  the  Federal 
Government,  the  Land  of  North  Rhine-Westphalia,  the  HKG  and  its  members  until  31 
December 2022.  

The unusually long safe enclosure stage to be expected for the THTR, and especially the later 
dismantling  of  a  concrete  reactor  pressure  vessel  (RCRPV),  give  reason  to  expect  new 

6 

OJ L 163, 23.6.2011, p. 24–25 

EN 

5 

  EN 

 
                                                 
knowledge  to  be  gained  on  the  decommissioning  of  nuclear  facilities.  In  addition,  the 
subsequent  dismantling  of  the  reactor  vessel,  for  which  there  is  not  yet  sufficient  practical 
experience,  will  have  considerable  cost  implications.  Under  these  circumstances,  further 
involvement of the managing company HKG and its members is essential and an extension of 
'European Joint Undertaking' status is in principle materially justified. 

HKG  has  applied  to  the  Commission’s  DG  Energy  to  have  the  status  of  “European  Joint 
Undertaking”  extended  until  31  December  2027.  However,  the  financing  arrangements  are 
currently only scheduled until the end of 2022 and the Council of the European Union, in its 
decision of 17 June 2011, reiterated that such a duration was a determining reason for limiting 
the  duration  of  the  advantages  to  be  conferred,  so  the  Ministry  of  Finance  of  the  Land  of 
North  Rhine  Westphalia  (FM  NRW),  affected  by  the  tax  advantages,  has  endorsed  the 
extension  of 'European Joint Undertaking'  status  only until  31 December  2022. The Federal 
Government has no reservations about setting such a time limit and, besides that, the Federal 
Ministry  of  Education  and  Research  (BMBF)  sees  no  reason  why  the  'European  Joint 
Undertaking'  status  should  necessarily  be  decoupled  from  the  duration  of  the  previously 
mentioned financing arrangement. 

Accordingly, the German Government is in favour of the 'European Joint Undertaking' status 
of HKG being extended until 31 December 2022. 

CONCLUSIONS 

The  Commission  considers  that  the  arguments  accepted  by  the  Council  in  2011  for  the 
extension  of  HKG's  Joint  Undertaking  status  are  still  valid  today;  in  particular,  the 
undertaking's  activities  are  still  the  same  and  the  context  in  which  it  performs  them  is 
identical. 

The  arrangements  concluded  between  the  German  Federal  Republic,  the  Land  of  North 
Rhine-Westphalia,  HKG  and  its  members  for  financing  HKG's  activities  apply  only  for  a 
period up to 31 December 2022. 

The Commission therefore proposes that the Council, in accordance with the period arranged 
between  the  German  authorities  and  HKG,  approves  the  extension  of  the Joint  Undertaking 
status until 31 December 2022. 

2. 

LEGAL BASIS 

Article  45  Euratom  Treaty  provides  for  the  establishment  of  Joint  Undertakings,  which  the 
Treaty  defines  as  undertakings  which  are  of  fundamental  importance  to  the  development  of 
the nuclear industry in the Community. 

Under Article 46 Euratom Treaty, every project for establishing a Joint Undertaking is subject 
to an inquiry by the Commission. 

The  Commission  must  forward  to  the  Council  any  project  for  establishing  a  Joint 
Undertaking, together with its reasoned opinion. 

Under  Articles  47  to  49  Euratom  Treaty,  Joint  Undertakings  are  established  by  Council 
decision on a proposal from the Commission. 

3. 

BUDGETARY IMPLICATIONS 

There is no budgetary implication for the EU budget. 

EN 

6 

  EN 

2022/0373 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the extension of the joint-undertaking status of Hochtemperatur-Kernkraftwerk 
GmbH 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Atomic  Energy  Community,  and  in 
particular Article 49 thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

By Decision 74/295/Euratom, the Council established Hochtemperatur-Kernkraftwerk 
GmbH (HKG) as a joint undertaking for a period of 25 years as from 1 January 1974.  

The objectives of HKG were to construct,  equip  and operate a nuclear power station 
with a capacity of approximately 300 MWe at Uentrop (Unna district) in Germany. 

After being in operation from 1987 to 1988, the nuclear power station was finally shut 
down on 1 September 1989 as a result of technical and economic difficulties. 

Since  1  September  1989  the  objective  of  HKG  has  been  to  implement  a programme 
for  decommissioning  the  nuclear  power  station  up  to  the  safe  enclosure  stage  and, 
thereafter,  to  carry  out  a  programme  of  surveillance  of  the  enclosed  nuclear 
installations. 
By  Decision  2011/362/Euratom7,  the  Council  extended  the  status  of  HKG  as  a  joint 
undertaking until 31 December 2017 to enable HKG to complete its decommissioning 
and surveillance programmes, in particular by lightening the financial burden. 

The  extension  periods  corresponded  to  the  duration  of  arrangements  concluded 
between  the  German  Federal  Republic,  the Land of  North  Rhine-Westphalia,  HKG 
and its members for financing HKG’s activities. 

By  letter  of  7  October  2021,  HKG  asked  for  the  further  extension  of  the  joint-
undertaking  status  with  retroactive  effect  from  1  January  2018,  until  31  December 
2022,  which  corresponds  to  the  duration  of  arrangements  concluded  between  the 
German  Federal  Republic,  the Land of  North  Rhine-Westphalia,  HKG  and  its 
members for financing HKG’s activities. 

HKG’s joint-undertaking status should therefore be extended for the same period. 

After 31 December 2022, any further extension of HKG’s Joint Undertaking status is 
conditional  on  the  submission  by  HKG  of  an  application  for  a  decommissioning 
licence. 

7 

OJ L 163, 23.6.2011, p. 24–25 

EN 

7 

  EN 

                                                 
HAS ADOPTED THIS DECISION:  

Article 1 

1. 

2. 

The  joint-undertaking  status,  within  the  meaning  of  the  Treaty,  granted  to 
Hochtemperatur-Kernkraftwerk  GmbH  (‘HKG’)  is  hereby  extended  for  five  years 
with effect from 1 January 2018. 

The objective of HKG shall be to implement a programme for decommissioning the 
nuclear power station located at  Uentrop  (Unna  district) in  the Federal  Republic of 
Germany, up to the safe enclosure stage and, thereafter, to carry out a programme of 
surveillance of the enclosed nuclear installations. 

Article 2 

This  Decision  is  addressed  to  the  Member  States  and  to  Hochtemperatur-Kernkraftwerk 
GmbH. 

Done at Brussels, 

For the Council 
The President 

EN 

8 

  EN