The Export reorganization act, 1975 : hearings before the Committee on Government Operations, United States Senate, Ninety-fourth Congress, first session, April 24, 30, and May 1, 1975 online

and related equipment aro required to be controlled to minimize
the possibility of compromise.



All emergency exits in the protected area, vital areas, and
material access areas must be alarmed against intrusion. Each
unoccupied material access area must be locked and alarmed.
All alarms must annunciate in a continuously manned central
alarm station located within the protected area and in at
least one other continuously manned station. All alarms must
be selfchecking and tamper-indicating and tested for operability
and required functional performance at specified intervals not
to exceed seven days. â– 



119



• Each guard or watchman on duty must be capable of maintaining
continuous communications with an individual in a continuously
manned central alarm station within the protected area, who is
capable of calling for assistance from other guards and from
local law enforcement authorities. To provide the capability
of continuous communication with local law enforcement
authorities, two-way radio voice communications must be
established in addition to conventional telephone service.

All communications equipment must remain operable by means of
independent power sources in the event of loss of primary
power, and must be tested for operability and performance
not less frequently than once at the beginning of each security
work shift.

• Licensees must establish liaison with local law enforcement
authorities. In developing security plans, licensees must
take into account the probable size and response time of the
local law enforcement assistance. The security force must
be prepared to take immediate action to neutralize threats
to the facility by appropriate direct action and by calling
for assistance from local law enforcement authorities.

• To aid licensees in carrying out the new protection requirements,
a number of new Regulatory Guides have been issued which set
forth acceptable ways for complying with selected requirements.

Upgrading of Material Control and Accounting Measures

Requirements for the control and accounting of special nuclear material
at licensed plants were also revised in flovember, 1973, to provide
greater sensitivity and timeliness for detecting the theft or diver-
sion of material. Quality specifications were prescribed for per-
forming plant material balances on the basis of measurements.

During 1974, the following material control and accounting require-
ments were generally applied to 30 facilities which were authorized
to possess more than one effective kilogram* of special nuclear
material in unsealed form:

♦Effective kilogram of special nuclear material means: (1) For
plutonium and uranium -233 their weight in kilograms; (2) For
uranium with an enrichment in the isotope U-235 of 0.01 (1") or above,
its element weight in kilograms multiplied by the square of its enrich-
ment expressed as a deGimal weight fraction; and (3) for uranium
with an enrichment in the isotope U-235 below 0.01 (1%), by its element
weight in kilograms multiplied by 0.001.



120

- i* -

The licensee must maintain and follow written material
control and accounting procedures.

Records must be kept showing the receipt, inventory
(including location), disposal, acquisition, import,
export, and transfer of all special nuclear materia]
in each licensee's possession, including records of the
quantities of material added to or removed from process.
Physical inventory and material balance records must
be maintained for a period of five years.

All transfers of special nuclear material between material
balance areas must be documented to show the identity and
quantity of material. Means must be provided for the
control and accounting of internal transfer documents
and for obtaining authorized signatures of each document. '

The licensee must uniquely identify items or containers
containing special nuclear material in process.

The licensee must use tamper-safe containers or vaults con-
taining special nuclear material not in process and control
access to the devices and records associated with their
application. Tamper-saf ing may be utilized to assure the
validity of material measurements performed prior to the
time of physical inventory.

Provisions must be made for accurate cutoff procedures,
verification of the integrity of the tamper-saf ing devices
used for securing previously measured material, verification
by remeasurement of the quantities of material previously
measured but not tamper-safed , and for the accurate listing
of the inventory. In addition to the general inventory
procedures, specific inventory instructions must be prepared
for each inventory.

• All quantities of material on inventory must be based on
measurements.

• The licensee must conduct physical inventories bimonthly for
plutonium and uranium 233, and uranium enriched 20 percent
or more in U-235, except for plutonium containing 30 percent
or more by weight of the isotope Pu-233 and plutonium and
uranium held in the inaccessible portion of an irradiated
fuel reprocessing plant. The licensee must conduct physical
inventories for uranium enriched less than 20 percent in the
isotope U-235, and those materials exempted from the bimonthly
inventories at least every six months.



121

- 5 -



• Within 30 days after the start of each physical inventory,
the licensee must calculate the material unaccounted for
(MUF) and its associated limit of error, reconcile and update
the accounting records to the results of the physical inventory,
and complete the material balance records for each material
balance.

• The licensee must maintain a system of control and accounting
such that the limits of error for any MUF do not exceed
threshhold quantities of 200 grams for plutonium or uranium
-233, 300 grams for uranium or the isotope uranium -235
contained in high enriched uranium, or 9,000 grams for
uranium -235 contained in low enriched uranium, or 0.5
percent of additions to or removals from material in process,
whichever is greater, except for a reprocessing plant where
the uncertainty for plutonium and uranium may be 1.0 percent
and 0.7 percent, respectively. In accordance with the provi-
sions of the regulations, two plants have been allowed higher
limits. Each of these has initiated programs to achieve
improvements in his material control system.

In October, 1974, the AEC issued amendments to its regulations
which specify fundamental nuclear material controls required to
be established, maintained, and followed by licensees authorized to
possess at any one time and location more than one effective kilogram
of special nuclear material in unsealed form.

These amendments provide the basic criteria for detailed licensee
material control and accounting systems. The criteria, in turn,
provide the basis for the eventual development of material control
and accounting systems utilizing advanced technology such as non-
destructive analysis and automatic data processing to provide real-
time accurate control of and accounting for special nuclear material.

Also in October, 1974, AEC published proposed regulations to
strengthen the materials control and accounting requirements for
special nuclear material in the interest of the common defense and
security. Such amendments would provide greater assurance that
material balances are based upon current, high quality measurement
data, so that a loss of material may be distinguished from measure-
ment uncertainty.

Under the proposed amendments each licensee who is authorized to
possess, at any one time and place, a quantity of certain special
nuclear material exceeding one effective kilogram in unsealed form
would be required to establish and maintain a measurement control
program covering all of the components of measurements used for



122

- 6 -



materials control and accounting purposes. The program would
include organizational controls for the management of measurement
quality, training and performance qualification requirements, a
standards and calibration system, a quality testing system for the
determination and the control of systematic and random errors, a
records evaluation system for the collection and statistical
analysis of the data, and a system of management audits and
reviews. If adopted by the Commission the proposed amendments would
give licensees three months to submit plans for the measurement con-
trol programs. The licensees would be required to follow the plans
submitted six months after the deadline date for submission or
thirty days after Commission approval whichever is later.

To aid licensees in carrying out the new material control and
accounting requirements, a number of new Regulatory Guides were
issued in 1974 to set forth acceptable ways for complying with
selected requirements.

Upgrading of Protection of SNM During Transport :

Comprehensive amendments to Commission regulations were issued in
November, 1973, to strengthen the protection of SUM during the
course of transportation. Each person who is licensed or who
applies for a license to possess more than 5000 grams of special
nuclear material as computed by the formula given above, except
SNM contained in irradiated fuel, must submit a plan to the liRC
for review and approval outlining the methods to be used for the
protection of the SNM while in transit. The licensee is not per-
mitted to make any change which would decrease the effectiveness of
his transportation security plan without prior approval of the
NRC. The plan must demonstrate the means to be used in meeting
the following requirements:

• If a common or contract carrier is used, the SNM must be
transported under the established procedures of the carrier
which provide a system for the physical protection of
valuable material in transit and require a hand-to-hand
receipt at origin and destination and at all points enroute
where there is a transfer of custody. Transit times of all
shipments must be minimized, and routes must be selected to
avoid areas of natural disaster or civil disorders. SUM must ,
be shipped in containers which are sealed by tamper-indicating
type seals. The outer container or vehicle is required to be
locked and sealed, flo container weighing 500 pounds or less
may be shipped on open vehicles, such as open trucks or railway
flatcars.



123



In November, 197^, the AEC published new proposed regulations
to further strengthen the protection of nuclear material in transit.
The regulations proposed, among other things, a significant strengthen-
ing of the armed escort which accompanies the shipments.



Upgrading of Protection at Licensed Nuclear Power Plants:

Regulations issued in November 1973. 10 CFR Parts 50 and 73 > required
that upgraded security plans for all licensed nuclear power plants
in the United States be submitted to the Commission. All such
resubmitted security plans have been reviewed by the staff, revised
if necessary, and subsequently found acceptable. In November 197^,
the Commission published for comment proposed new rules, as 10 CFR
Section 73-55, setting forth specific requirements for physical
protection of nuclear power plants against acts of industrial
sabotage. Comments received are presently being considered and a
modified rule is expected to be issued within a few months. Following
issuance of the effective rule, its requirements will be implemented.

The Sandia Laboratories currently have underway contract studies on
the vulnerability of nuclear power plants to acts of sabotage. The
first phase of this multi-phase study was completed in 197^ and their
final report is expected to be issued in the near future.



124

Senator Glenn. Our next witnesses this morning are Dr. Dixy
Lee Ray, Assistant Secretary of State for Oceans, International
Environmental and Scientific Affairs, and former Chairman of the
Atomic Energy Commission; Dr. Robert C. Seamans, Jr., Admini-
strator, Energy Research and Development Administration; and
Mr. John K. Tabor, Deputy Secretary of Commerce.

I am glad to welcome such a distinguished panel here this morning,
and I look forward to your testimony.

Dr. Seamans, perhaps you could lead off. We have your statement.

Do you propose to read it this morning, or would you like to
submit it for the record?

Dr. Seamans. I would like to submit it for the record, Mr. Chair-
man.

Senator Glenn. Fine. Are there statements from the other panel
members ?

Do you have those to be submitted?

Dr. Rat. I would like to present my statement, Mr. Chairman.

Senator Glenn. You may proceed, Dr. Ray.

TESTIMONY OF DR. DIXY LEE RAY, ASSISTANT SECRETARY OP
STATE FOR OCEANS, INTERNATIONAL ENVIRONMENTAL AND
SCIENTIFIC AFFAIRS, AND FORMER CHAIRMAN OF THE ATOMIC
ENERGY COMMISSION

Dr. Rat. Thank you Mr. Chairman.

I am pleased to have this opportunity to appear before you since
the subject of the bill S. 1439 is one in which I have a great personal
interest both in my previous position as Chairman of the Atomic
Energy Commission and my current role as the Assistant Secretary
of State who is responsible for international nuclear activities. I am
accompanied by Mr. George Vest, Director of the Department's Bu-
reau of Politico-Military Affairs, who has important responsibilities
in the field of export control, and members of my staff.

Before I turn to some of the significant aspects of this legislation,
I would like to offer some general observations.

First : As is true for the members of this committee, the Depart-
ment of State ascribes high importance to assuring that U.S. inter-
national cooperation in the nuclear field is conducted under conditions
that are compatible with our nonproliferation objectives.

Second : In approaching this problem I believe we must give rec-
ognition to the extensive efforts that have gone into the development
of international machinery to help assure that nuclear energy is used
only for peaceful purposes. The broad bilateral safeguards rights
which we have acquired, the IAEA safeguards systems, and the Non-
Proliferation Treaty represent unprecedented measures in the long
history of man's efforts to evolve institutions which reduce the risks
of international conflict — measures which I believe deserve continuing
support.

Third : We must recognize that we are no longer living in a world
where the United States has a monopoly. The technology for the pro-
duction of fissionable materials has been in practical use in the United
States for more than 30 years. Few, if any, technologies have diffused



125

so little over such a long period of time. Other nations, however, are
now actively constructing their own nuclear facilities and providing
significant nuclear assistance to others. This fact limits our bargain-
ing power in securing the arrangements which, ideally, might de-
sirable, and make it all the more important that we cooperate with
other countries bilaterally and multilaterally to achieve our non-
proliferation objectives.

With the foregoing factors in mind, I strongly urge that we continue
to give our full support to the NPT and the IAEA safeguards system
and urge widespread acceptance of these instruments, by as many
states as possible. The IAEA safeguards system, despite its imper-
fection, represents one of the best techniques that we have to verify
independently that nations are directing their safeguarded activities
to peaceful purposes. It also has represented an unprecedented step
on the part of many nations to submit to international inspections to
verify that their treaty commitments are being adhered to. Any step
which might, however unintentionally undermine our efforts in sup-
port of the IAEA system might well set back rather than advance
our nonproliferation objectives. Thus, I believe that the remedy to
correct any deficiencies in the present system can be found in our
seeking to strengthen this system, rather than in our seeking to create
new devices.

In view of the realities that we now face, it is more important than
ever for us to work vigorously in concert with other nuclear equip-
ment suppliers to assure that we are all following common and pru-
dent export control policies. This is an area to which the United
States has devoted very substantial attention over recent months.

It also is important, to my mind, for the United States to continue
to associate itself constructively with foreign nuclear power programs
in ways that will help assure that these programs are oriented to
peaceful purposes. In this latter regard, I should stress that I am
not one of those who now criticize the "Atoms for Peace" program
or who assert that this program was a major cause for our current
challenge. As others have indicated, I am convinced that had the
United States not agreed to cooperate in the 1950's, other nations
would nevertheless have proceeded on their own, or with the help
of other suppliers. The risks of allowing independent nuclear pro-
grams to emerge without restraint or control would have been greater
than those that have been associated with the course we since have
followed.

Finally, and before turning to the specifics of the legislation, I
would hope that we could agree that nuclear power promises to pay
an extremely vital role in helping to meet our energy needs and that
this role has even greater importance as we and others endeavor to
reduce our dependency on foreign energy suppliers. Consequently,
in approaching the challenge of fostering effective export controls,
I would hope that we would neither hobble the further development
of a vital new energy source nor our ability to closely cooperate with
our allies in putting this energy source to constructive use.

We should now like to comment on some of the principal features
of the bill.

The Department of State is unable to concur with sections of the
bill which would transfer to the Secretary of Commerce such func-



126

tions of the Secretary of State under section 414 of the Mutual Se-
curity Act of 1954 as relate to the approval for export of arms, am-
munition and the implements of war. Our basic objection relates to
the fact that foreign policy considerations are the fundamental
objectives behind this provision of the law. Consequently, we believe
it is important for administration of this provision to remain with
the Department of State. Mr. Vest, who is with me will be happy to
explain some of our concerns in this regard, in further detail.

Reverting to the more central nuclear focus of the bill, we foresee
several difficulties.

Section 7, for example, would preclude the Secretary of Commerce
from licensing or approving nuclear exports unless the Nuclear Reg-
ulatorv Commission first determine that the recipient countries have
safeguards at least substantially comparable to safeguards required
by NRC in the United States. "This would accord NRC, a de facto
right to veto exports. In addition, in the case of "strategically sig-
nificant" exports which are not defined, section 8 would require NRC
to prepare a "nuclear proliferation statement" and to furnish this
statement to ACDA for comment prior to proceeding with an export.
We have substantial reservations about the propriety of using
"comparability with the U.S. domestic safeguards systems" as the
basic test for 'determining whether any exports should be approved.
This, to our mind, may give emphasis to the U.S. domestic safe-
guards system and insufficient weight to other factors that could be
more relevant to determining whether an export would be inimical to
the common defense and security. For example, we believe that ad-
herance to the NPT and subjecting the facilities involved to IAEA
safeguards are more important than conformance with our domestic
safeguards in helping to assure that the cooperating government will
be a stable and reliable partner in a transaction.

National svstems, including the U.S. domestic system are prin-
cipally designed to deal with internal threats. The IAEA system,
however, is our basic and most important tool to detect and prevent
diversions to military programs at the national level and it is far
more rigorous from this standpoint than most domestic systems.
While the two kinds of systems are complementary, we are concerned
that the bill would serve to shift emphasis away from U.S. support
of IAEA controls.

Also while we favor and are encouraging a general upgrading of
domestic safeguards systems worldwide, we question the propriety
of the United States employing its own system as the test against
which to measure the performance of other countries. Of necessity,
there can be legitimate differences between national programs be-
cause of wide, difference in constitutional and legal practices, cus-
toms, et cetera. Moreover, as it is the U.S. domestic system gives
fairly broad delegations for implementing and policing responsibility
to U.S. industry. While this appears appropriate in our free-enter-
prise society, different systems or arrangements could well be re-
quired in other governmental systems.

We also are concerned that cooperating countries would view the
flat requirement that U.S. physical security standards be employed
as a test for cooperation, to be an unwarranted intrusion into their
domestic procedures.



127

It should be noted, that at the present time, exports can be denied
if the executive branch judges them to be inimical to the common
defense and security, et cetera. This is a broad and useful test that
has enabled the United States to take various factors into account,
including a country's stability, NPT status, safeguards attitudes,
et cetera, prior to authorizing significant exports. While we recognize
that the other applicable provisions of the Atomic Energy Act will
remain unchanged we are concerned that the new bill could reduce
flexibility in processing exports by implying that "comparability
with U.S. safeguards" and preparation of a "nuclear proliferation
assessment statement" are the only criteria.

"We also have some reservations about the suitability of having
NRC prepare the nuclear proliferation assessment called for by sec-
tion 8. As others have explained the evaluation of how a sensitive
export might affect a country's nuclear program frequently involves
the participation of several national security agencies within the
executive branch. We believe this picture should be allowed to con-
tinue.

This, in turn, brings up a far more basic problem relating to the
appropriate role that NRC should assume in the international safe-
guards and nonproliferation area.

Frankly we have reservations about the propriety and constitu-
tionality of enabling NRC to prevent, through its actions, the imple-
mentation of agreements for cooperation that have been negotiated
by the executive branch, approved by the President and reviewed by
the Congress prior to entry into force. This is a very serious problem
that I believe merits further attention. NRC, however, does have very
important responsibilities in the domestic safeguards field, and we
believe its technical counsel should prove useful when it comes to
supporting the executive branch in its efforts to deal with subnational
or terrorist threats at an international level.

On balance, Mr. Chairman, we are concerned that this legislation
might detract from the mechanisms established under the NPT and
IAEA systems and possibly hinder rather than promote our non-
proliferation objectives. We also are concerned, that the procedural
complexities that might be inherent in the bill could lessen the credi-
bility of the United States as a supplier of nuclear fuel and equip-
ment with possible adverse political and economic effects.

These are our preliminary views but we, of course, will be pleased
to discuss the matter with you further.

This concludes my formal statement and I remain available to try
to answer any questions that you might care to put to me.

Senator Glenn. Thank you. Dr. Ray.

[Additional questions submitted by Senator Ribicoff to Dr. Dixy
Lee Ray, with responses follow:]



128



RESPONSES



Question #1:

Is it true that the United States does not have
access to the specific terms of the subsidiary safe-
guards agreements that the IAEA negotiates in our
behalf with nations to which we export nuclear
materials and facilities? If so, how can we be
sure that these safeguards are adequate?

Response :

Safeguards agreements negotiated by the IAEA
with Parties to the Non-Prolif eration Treaty consist,
in general, of two parts. These are: (a) the safe-
guard agreement itself, which establishes the general