[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2359 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 2359

   To amend the Nuclear Non-Proliferation Act of 1978 and the Atomic 
Energy Act of 1954 to improve the organization and management of United 
        States nuclear export controls, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 9, 1993

Mr. Lantos introduced the following bill; which was referred jointly to 
   the Committees on Foreign Affairs and Banking, Finance and Urban 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
   To amend the Nuclear Non-Proliferation Act of 1978 and the Atomic 
Energy Act of 1954 to improve the organization and management of United 
        States nuclear export controls, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Nuclear Export Reorganization Act of 
1993''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
Sec. 4. Findings and Policy.
    TITLE I--AMENDMENTS TO THE NUCLEAR NON-PROLIFERATION ACT OF 1978

Sec. 101. Reports of the President.
Sec. 102. Export controls over nuclear dual-use items.
Sec. 103. Non-nuclear energy resources.
             TITLE II--INITIATIVES TO STRENGTHEN COMPLIANCE

Sec. 201. Fair market initiative.
Sec. 202. Measures to improve the licensing process.
         TITLE III--AMENDMENTS TO THE ATOMIC ENERGY ACT OF 1954

Sec. 301. Subsequent arrangements.
Sec. 302. Cooperation with other nations.
Sec. 303. Prohibition on foreign production of special nuclear 
                            material.
Sec. 304. Prohibition on nuclear exports.
Sec. 305. Control of component parts.
             TITLE IV--SANCTIONS FOR NUCLEAR PROLIFERATION

Sec. 401. Imposition of sanctions.
Sec. 402. Eligibility for assistance.
Sec. 403. Role of international financial institutions.
Sec. 404. Amendment to the International Emergency Economic Powers Act.
Sec. 405. Amendment to the Federal Deposit Insurance Corporation 
                            Improvement Act of 1991.
Sec. 406. Export-Import Bank of the United States.
Sec. 407. Additional amendments to the Foreign Assistance Act of 1961.
Sec. 408. Reward.
Sec. 409. Reports.
Sec. 410. Technical correction.
              TITLE V--INTERNATIONAL ATOMIC ENERGY AGENCY

Sec. 501. Bilateral and multilateral initiatives.
Sec. 502. Reforms in IAEA safeguards.
Sec. 503. Reporting requirement.
                TITLE VI--REVIEW OF PLUTONIUM USE POLICY

Sec. 601. Findings and declarations.
Sec. 602. Report.

SEC. 3. DEFINITIONS.

    For purposes of this Act--
            (1) the term ``direct-use material'' means nuclear material 
        that can be used for the manufacture of nuclear explosive 
        components without transmutation or further enrichment, such as 
        plutonium containing less than 80 percent plutonium-238, 
        uranium enriched to 20 percent uranium-235 or more, uranium-
        233, and chemical compounds, mixtures of direct-use materials 
        (including mixed oxide reactor fuel), and plutonium contained 
        in spent nuclear fuel;
            (2) the term ``goods or technology'' means nuclear 
        materials and equipment and sensitive nuclear technology (as 
        such terms are defined in section 4 of the Nuclear Non-
        Proliferation Act of 1978), all export items designated 
        pursuant to section 309(c) of the Nuclear Non-Proliferation Act 
        of 1978, and all technical assistance requiring authorization 
        under section 57b. of the Atomic Energy Act of 1954;
            (3) the term ``highly enriched uranium'' means uranium 
        enriched to 20 percent or more in the isotope U-235;
            (4) the term ``IAEA'' means the International Atomic Energy 
        Agency;
            (5) the term ``IAEA safeguards'' means the safeguards set 
        forth in an agreement between a country and the International 
        Atomic Energy Agency, as authorized by Article III(A)(5) of the 
        Statute of the International Atomic Energy Agency;
            (6) the term ``near real time material accountancy'' means 
        a method of accounting for the location, quantity, and 
        disposition of special fissionable material at facilities that 
        store or process such material, in which verification of 
        peaceful use is continuously achieved by means of frequent 
        physical inventories and the use of in-process instrumentation;
            (7) the term ``non-nuclear-weapon state'' means any country 
        which is not a nuclear-weapon state, as defined by Article 
        IX(3) of the Treaty on the Non-Proliferation of Nuclear 
        Weapons, signed at Washington, London, and Moscow on July 1, 
        1968;
            (8) the term ``nuclear dual-use items'' means all goods and 
        technologies whose export from the United States is controlled 
        pursuant to sections 309(c) and 311 of the Nuclear Non-
        Proliferation Act of 1978;
            (9) the term ``nuclear explosive device'' means any device, 
        whether assembled or disassembled, that is designed to release 
        in one microsecond or less an amount of nuclear energy from 
        special nuclear material that is greater than the amount of 
        energy that would be released from the detonation of one pound 
        of trinitrotoluene (TNT);
            (10) the term ``special fissionable material'', as used in 
        title III of this Act, has the meaning given that term by 
        Article XX(1) of the Statute of the International Atomic Energy 
        Agency, done at the Headquarters of the United Nations on 
        October 26, 1956;
            (11) the term ``special nuclear material'' has the meaning 
        given that term in section 11 aa. of the Atomic Energy Act of 
        1954 (42 U.S.C. 2014aa);
            (12) the term ``Treaty'' means the Treaty on the Non-
        Proliferation of Nuclear Weapons, signed at Washington, London, 
        and Moscow on July 1, 1968; and
            (13) the term ``unsafeguarded special nuclear material'' 
        means special nuclear material which is held in violation of 
        IAEA safeguards or is not subject to IAEA safeguards, and does 
        not include any quantity of material that could, if it were 
        exported from the United States, be exported under a general 
        license issued by the Nuclear Regulatory Commission.

SEC. 4. FINDINGS AND POLICY.

    (a) Findings.--The Congress finds that--
            (1) the proliferation of nuclear explosive devices poses a 
        serious and growing threat to the national security of the 
        United States;
            (2) any effective response to this threat should include 
        measures to curb both the demand for and the supply of goods 
        and technology to acquire such devices;
            (3) non-nuclear-weapon states with clandestine programs for 
        the manufacture of nuclear explosive devices continue to seek 
        foreign sources of goods and technologies that are important to 
        the success of such programs;
            (4) export controls, especially when coordinated 
        internationally, inhibit such programs by adding to the costs 
        of acquiring alternative sources of restricted goods and 
        technologies and by delaying the implementation of such 
        programs;
            (5) the implementation of export controls generates 
        information that is useful in assessing the efforts by 
        importing nations to acquire capabilities to develop or produce 
        such devices and that provides an early warning of illicit 
        foreign procurement patterns;
            (6) a renewed effort is needed to improve controls over 
        nuclear dual-use items; and
            (7) the economy and effectiveness of the executive branch 
        of Government, and the effectiveness of congressional 
        oversight, require the reorganization and centralization of 
        certain export licensing functions of the Government in a 
        single agency to which all persons and commercial interests 
        seeking to engage in foreign commerce may apply.
    (b) Policy.--It is the policy of the United States--
            (1) to restrict the export or reexport of goods or 
        technology that would be contrary to the objectives of the 
        United States with respect to the nonproliferation of nuclear 
        explosive devices;
            (2) to strengthen sanctions against illicit suppliers of 
        nuclear goods or technology;
            (3) to ensure that significant national security interests 
        will prevail over commercial considerations in the event of any 
        conflict in the nuclear export licensing process between these 
        national objectives;
            (4) to cooperate with other nations to develop multilateral 
        measures to halt the global proliferation of nuclear explosive 
        devices;
            (5) to encourage individuals and companies to develop 
        voluntary measures to ensure that goods or technology will not 
        be exported that would promote the global proliferation of 
        nuclear explosive devices;
            (6) to ensure greater openness and accountability in the 
        nuclear export licensing process; and
            (7) to undertake reforms devoted to improving the 
        efficiency and effectiveness of the nuclear export licensing 
        process.

    TITLE I--AMENDMENTS TO THE NUCLEAR NON-PROLIFERATION ACT OF 1978

SEC. 101. REPORTS OF THE PRESIDENT.

    Section 601(a) of the Nuclear Non-Proliferation Act of 1978 (22 
U.S.C. 3281(a)) is amended--
            (1) in paragraph (4), by striking ``and'' after the 
        semicolon;
            (2) in paragraph (5), by striking the period and inserting 
        ``; and''; and
            (3) by adding after paragraph (5) the following new 
        paragraph:
            ``(6) a description of the implementation of nuclear export 
        controls in the preceding calendar year, including a summary by 
        type of commodity, by value per type of commodity, and by 
        destination, of--
                    ``(A) any transactions for which--
                            ``(i) a license was issued for the export 
                        or retransfer of any good controlled under 
                        section 309(c) or 311 of the Nuclear Non-
                        Proliferation Act of 1978;
                            ``(ii) a license was issued for the export 
                        or retransfer of any good controlled under 
                        section 109 b. of the 1954 Act; and
                            ``(iii) an authorization was made as 
                        required by section 57 b.(2) of the 1954 Act to 
                        engage, directly or indirectly, in the 
                        production of special nuclear material; and
                    ``(B) each instance in which--
                            ``(i) a sanction has been imposed under 
                        section 401(a) of the Nuclear Export 
                        Reorganization Act of 1993, section 670(b)(1) 
                        of the Foreign Assistance Act of 1961, or 
                        section 601 or 602 of the Federal Deposit 
                        Insurance Corporation Improvement Act of 1991;
                            ``(ii) a sale or lease has been denied 
                        under section 3(f) of the Arms Export Control 
                        Act or a transaction prohibited by reason of 
                        any act relating to proliferation of nuclear 
                        explosive devices, as described in section 
                        40(d) of that Act;
                            ``(iii) a sanction has not been imposed by 
                        reason of section 401(c)(2) of the Nuclear 
                        Export Reorganization Act of 1993 or the 
                        imposition of a sanction has been delayed under 
                        section 670(b)(4) of the Foreign Assistance Act 
                        of 1961; or
                            ``(iv) a waiver of a sanction has been made 
                        under--
                                    ``(I) section 401(f) of the Nuclear 
                                Export Reorganization Act of 1993,
                                    ``(II) section 620E(d), or 
                                paragraph (5) or (6) of section 670(b), 
                                of the Foreign Assistance Act of 1961,
                                    ``(III) section 605 of the Federal 
                                Deposit Insurance Corporation 
                                Improvement Act of 1991,
                                    ``(IV) section 40(g) of the Arms 
                                Export Control Act with respect to the 
                                last sentence of section 40(d) of that 
                                Act, or
                                    ``(V) section 614 of the Foreign 
                                Assistance Act of 1961 with respect to 
                                section 620E or 670(b)(1) of that Act 
                                or section 3(f), or the last sentence 
                                of section 40(d), of the Arms Export 
                                Control Act.''.

SEC. 102. EXPORT CONTROLS OVER NUCLEAR DUAL-USE ITEMS.

    (a) Amendment to the National Security Act of 1947.--Section 101 of 
the National Security Act of 1947 (50 U.S.C. 402) is amended by adding 
at the end thereof the following new subsection:
    ``(h)(1) The President shall establish within the National Security 
Council a `Subgroup on Nuclear Export Coordination'. The principal 
function of the Subgroup shall be to implement the export controls 
required by sections 309(c) and 311 of the Nuclear Non-Proliferation 
Act of 1978 (Public Law 95-242).
    ``(2) There are authorized to be appropriated to the Subgroup such 
sums as may be necessary to carry out the functions of the Subgroup 
under title III of the Nuclear Non-Proliferation Act of 1978.''.
    (b) Amendment to the Nuclear Non-Proliferation Act of 1978.--Title 
III of the Nuclear Non-Proliferation Act of 1978 is amended by adding 
at the end thereof the following new sections:

``SEC. 310. SUBGROUP ON NUCLEAR EXPORT COORDINATION.

    ``(a) Composition of the Subgroup.--(1) The Subgroup on Nuclear 
Export Coordination (hereafter in this title referred to as the 
`Subgroup'), established in section 101(h) of the National Security Act 
of 1947, shall be composed of six members who shall be Government 
officials having expertise in the control of exports and the non-
proliferation of nuclear explosive devices. Each such member shall be 
designated by the head of one of the following United States agencies 
from among officials of that agency, with no agency represented by more 
than one member:
            ``(A) The Department of State.
            ``(B) The Department of Defense.
            ``(C) The Department of Energy.
            ``(D) The Department of Commerce.
            ``(E) The Arms Control and Disarmament Agency.
            ``(F) The Nuclear Regulatory Commission.
    ``(2) The representative of the Arms Control and Disarmament Agency 
shall serve as Chairman of the Subgroup.
    ``(3) Upon request of the Chairman of the Subgroup, other 
departments and agencies of the United States, including elements of 
the intelligence community, the Department of Treasury, the United 
States Customs Service, and the Federal Bureau of Investigation, shall 
detail personnel to the Subgroup for the performance of duties on a 
temporary basis.
    ``(b) Functions.--The Subgroup shall--
            ``(1) serve as a forum for identifying and expressing the 
        views of the constituent agencies with respect to--
                    ``(A) the proliferation risks associated with the 
                export of nuclear dual-use items;
                    ``(B) possible international initiatives to 
                strengthen the global administration and enforcement of 
                controls over the export of such items; and
                    ``(C) recommendations to the President on 
                regulatory and legislative measures to improve the 
                efficiency or effectiveness of export controls over 
                such items, including the verification of peaceful end-
                uses and the design and execution of improved post-
                export verification measures;
            ``(2) review applications for the export of nuclear dual-
        use items in accordance with sections 309(c) and 311;
            ``(3) designate the items for inclusion on the Nuclear 
        Referral List established under section 311(a) and shall 
        determine their description and technical specifications;
            ``(4) monitor and facilitate the interagency process with 
        respect to the nuclear export licensing activities described in 
        this Act or in the Atomic Energy Act of 1954, and in 
        regulations issued pursuant to such Acts; and
            ``(5) undertake investigations and make recommendations in 
        accordance with section 201 of the Nuclear Export 
        Reorganization Act of 1993.
    ``(c) Access to Export Licensing Information.--Notwithstanding any 
other provision of law--
            ``(1) the members of the Subgroup shall have full, timely, 
        and equal access to information contained in applications for 
        the export from the United States, or the reexport from any 
        other country, of any nuclear dual-use item;
            ``(2) the Secretary of Commerce shall, upon request by any 
        member of the Subgroup, provide that member with information 
        contained in applications for licenses to export any other item 
        from the United States, if that member requests such 
        information for purposes relating to the objectives of this 
        Act; and
            ``(3) the Secretary of Commerce shall, within six months 
        after the issuance of a license to export any nuclear dual-use 
        item from the United States, open to the public for examination 
        and inspection all nonproprietary data pertaining to such 
        license, including--
                    ``(A) the commodity description,
                    ``(B) the country destination,
                    ``(C) the end-use and end-user,
                    ``(D) the quantity,
                    ``(E) the date of approval, and
                    ``(F) the date and method of shipment,
        if no names of persons or companies and no dollar values of 
        commodities in individual licenses are included among this 
        data.
    ``(d) Export Control Bulletin.--(1) The Chairman of the Subgroup 
shall, in consultation with the Subgroup, establish and publish an 
export control bulletin on issues relating to the proliferation of 
nuclear explosive devices, including regulations, international 
agreements, and other relevant developments that the Chairman 
determines may be necessary for the purpose of informing exporters and 
the general public about the risks of proliferation and efforts to 
reduce or eliminate such risks.
    ``(2) Information appearing in the bulletin shall constitute one, 
but not an exclusive, basis for satisfaction of the criterion of 
`requisite knowledge' in section 401(a) of the Nuclear Export 
Reorganization Act of 1993 and in section 601(a) of the Federal Deposit 
Insurance Corporation Improvement Act of 1991, and the criterion of 
`knows or has reason to know' in section 311(b)(3) of this Act.

``SEC. 311. LICENSING PROCESS.

    ``(a) Controlled Items.--(1)(A) The President shall establish and 
maintain a list of items, designated by the Subgroup, whose export is 
controlled pursuant to section 309(c). Such list may be known as the 
`Nuclear Referral List'.
    ``(B) The President shall cause the Nuclear Referral List and any 
modification thereof to be published in the Federal Register.
    ``(C) Except as otherwise provided under section 202(b) of the 
Nuclear Export Reorganization Act of 1993, an individual validated 
license is required for the export from the United States of any item 
on the Nuclear Referral List.
    ``(2) For purposes of this section, any item that--
            ``(A) is not on the Nuclear Referral List,
            ``(B) requires a validated export license for national 
        security reasons, and
            ``(C) is intended for a nuclear-related end-use or end-
        user,
shall be subject to the procedures established under this title which 
are otherwise applicable to items on the Nuclear Referral List.
    ``(3)(A) An individual validated license is required for an export 
to any destination of any technical data or commodity where the 
exporter knows or has reason to know that the data or commodity will be 
used directly or indirectly in any of the following activities, whether 
or not the item is specifically designed or modified for such 
activities:
            ``(i) Designing, developing, fabricating, or testing any 
        nuclear explosive device.
            ``(ii) Designing, constructing, fabricating, or operating 
        any of the following facilities, or components for such 
        facilities:
                    ``(I) Facilities for the chemical processing of 
                irradiated special nuclear or source material.
                    ``(II) Facilities for the production of heavy 
                water.
                    ``(III) Facilities for the separation of isotopes 
                of source and special nuclear material.
                    ``(IV) Facilities for the fabrication of nuclear 
                reactor fuel containing plutonium or highly enriched 
                uranium.
                    ``(V) Unsafeguarded nuclear fuel cycle facilities.
    ``(B) An item is used indirectly in an activity described in 
subparagraph (A)--
            ``(i) if any United States agency notifies an exporter of 
        the risk of any such use; or
            ``(ii) the item would materially assist the performance of 
        any such activity.
    ``(b) Authority of the Secretary of Commerce.--Except as otherwise 
provided in this section, the Secretary of Commerce shall be 
responsible for--
            ``(1) processing all applications for validated licenses 
        for the export of all nuclear dual-use items requiring such a 
        license before the export from the United States or the 
        reexport from any other country of any such items; and
            ``(2) record keeping with respect to the approval or denial 
        of such licenses or authorizations.
    ``(c) License Approvals and Denials.--(1) Whenever the Secretary of 
Commerce receives an application for a validated license for the export 
from the United States of any nuclear dual-use item, the Secretary 
shall submit the application to the Subgroup for review as to whether--
            ``(A) approval of such export would be contrary to the 
        objective of averting the proliferation of nuclear explosive 
        devices; or
            ``(B) the proposed export would pose an unacceptable risk 
        of diversion to a nuclear explosive activity or to an 
        unsafeguarded nuclear fuel cycle.
    ``(2) The Secretary shall issue no license for the export of any 
nuclear dual-use item without the concurrence of all members of the 
Subgroup that each of the review criteria of paragraph (1) has been 
fully satisfied.
    ``(3) In performing the reviews required by paragraph (1), the 
members of the Subgroup shall include the following factors among the 
considerations used to determine what action should be taken on 
individual applications:
            ``(A) The stated end-use of the commodity or technical 
        data.
            ``(B) The significance for nuclear purposes of the 
        particular commodity or technical data.
            ``(C) The availability of the commodity or technical data 
        from non-United States sources.
            ``(D) The types of assurances or guarantees against use for 
        nuclear explosive purposes or proliferation given in the 
        particular case.
            ``(E) The non-proliferation credentials of the importing 
        country concerned, based on consideration of factors such as--
                    ``(i) a country's status as a party to the Treaty 
                on the Non-Proliferation of Nuclear Weapons or the 
                Treaty for the Prohibition of Nuclear Weapons in Latin 
                America;
                    ``(ii) whether the country has all its nuclear 
                activities under International Atomic Energy Agency 
                safeguards or equivalent full scope safeguards;
                    ``(iii) whether there is an agreement for 
                cooperation in the civil uses of atomic energy between 
                the United States and the country concerned;
                    ``(iv) the country's public statements and policies 
                concerning nuclear developments and non-proliferation;
                    ``(v) the extent of cooperation in non-
                proliferation policy generally (indications such as 
                willingness to consult on international non-
                proliferation issues); and
                    ``(vi) intelligence data on a country's nuclear 
                intentions and activities, including whether the 
                country has engaged in clandestine or illegal 
                procurement activities, whether similar licenses have 
                previously been denied by any other country, and 
                whether end users in the recipient country have 
                diverted, for purposes inconsistent with this section, 
                any nuclear goods or technology, under an export, 
                retransfer, or other activity previously authorized by 
                any country.
    ``(d) Procedures and Appeals.--(1) Applications for the export of 
nuclear dual-use items shall be made to the Department of Commerce.
    ``(2)(A) Upon receipt of any such application, the Secretary of 
Commerce shall promptly refer the application to the Subgroup.
    ``(B) Not later than 90 days after receipt of an application from 
the Secretary, the Subgroup shall complete its review of that 
application in accordance with subsection (c)(1) and shall report to 
the Secretary its determination regarding the application of that 
subsection.
    ``(3) If the Subgroup has not taken action on an application by 90 
days after receipt of that application, the applicant may file a 
petition with the Secretary of Commerce requesting compliance with the 
requirements of this section. Whenever such a petition is filed, the 
Secretary shall take immediate steps to correct the situation giving 
rise to the petition and shall immediately notify the applicant of such 
steps.
    ``(4) If, within 20 days after a petition is filed under paragraph 
(3), the processing of the application does not meet the requirements 
of this section, or the application meets such requirements but the 
Secretary has not so notified the applicant, then the applicant may 
bring an action in an appropriate United States district court for a 
restraining order, a temporary or permanent injunction, or other 
appropriate relief, to require compliance with the requirements of this 
section. The United States district courts shall have jurisdiction to 
provide such relief, as appropriate.
    ``(5)(A)(i) Any constituent agency of the Subgroup may appeal the 
denial of a license under this section to the President and, if the 
President determines that the license should be approved, the President 
shall direct the Secretary of Commerce to issue such license.
    ``(ii) The Secretary of Commerce shall report to the Congress on 
data from such licenses in accordance with section 602(c) of the 
Nuclear Non-Proliferation Act of 1978.
    ``(B) The procedures of this paragraph shall be the exclusive means 
of appeal for denials of licenses issued under this section.
    ``(C) Documentation describing and supporting the agency's position 
shall be submitted to the President as part of any appeal.
    ``(D) The President shall prescribe such regulations as may be 
necessary to carry out this paragraph.''.

SEC. 103. NON-NUCLEAR ENERGY RESOURCES.

    Title V of the Nuclear Non-Proliferation Act of 1978 is amended--
            (1) in section 501, by inserting ``(a)'' immediately after 
        ``Sec. 501.'';
            (2) by adding at the end of section 501 the following:
    ``(b)(1) The Congress declares that it is both in the national 
security and economic interests of the United States to promote the 
development in the United States of a domestic industry capable of 
competing on international markets for the sale of energy technologies 
capable of achieving the objectives of section 501(a).
    ``(2) The Congress urges the President to pursue all appropriate 
means to encourage the development of such an industry in the United 
States and otherwise to assist developing countries to acquire such 
technologies.''; and
            (3) by adding at the end of the title the following new 
        section:
    ``Sec. 504. Review of Research and Development.--Not later than 6 
months after the date of enactment of the Nuclear Export Reorganization 
Act of 1993, the President shall undertake a review of all federally 
funded research and development consistent with the objectives of 
section 501 and shall report to the Congress on the adequacy of such 
activities to achieve such objectives.''.

             TITLE II--INITIATIVES TO STRENGTHEN COMPLIANCE

SEC. 201. FAIR MARKET INITIATIVE.

    (a) Petition for Investigation.--Any United States person that 
finds that a foreign person has, on or after the date of enactment of 
this Act, engaged in an activity outside the United States that is 
inconsistent with the guidelines adopted by the United States and other 
member countries of the Nuclear Suppliers Group with respect to exports 
of nuclear dual-use items, or successor guidelines adopted by such 
countries, may petition the Subgroup on Nuclear Export Coordination to 
begin an investigation of such activities.
    (b) Determination by Subgroup.--Within 30 days of the date of 
receipt of any such petition, the Subgroup shall determine whether to 
undertake an investigation.
    (c) Recommendation Regarding Sanctions.--If the Subgroup undertakes 
an investigation and determines that the claims of the petitioner are 
sustained by available evidence, the Chairman of the Subgroup shall 
transmit a determination to that effect to the President, together with 
the specific recommendation of the Subgroup as to the imposition of the 
appropriate sanctions under title IV of this Act or under the 
amendments made by that title.
    (d) Publication in the Federal Register.--If the President does not 
disapprove such determination within a period of 30 days after receipt 
of such determination, the Chairman shall publish such determination in 
the Federal Register and the sanctions shall take effect.

SEC. 202. MEASURES TO IMPROVE THE LICENSING PROCESS.

    (a) Guidelines for Voluntary Codes of Conduct.--(1) Within 6 months 
after the date of enactment of this Act, the Subgroup shall develop 
guidelines to serve as a basis for the adoption of voluntary codes of 
conduct by companies that engage in exports of nuclear dual-use items.
    (2) The Chairman shall publish in the Federal Register such 
guidelines and the names of all companies that have agreed to adopt 
such codes of conduct.
    (b) Review of Types of Licenses.--(1) The Subgroup shall undertake 
a comprehensive review of the circumstances under which certain nuclear 
dual-use goods could be exported under licenses other than an 
individual validated license, without jeopardizing the national 
security, national interest, or nonproliferation objectives of the 
United States.
    (2) The Secretary of Commerce may, with the concurrence of the 
Subgroup, issue any such license identified in paragraph (1).
    (3) The Secretary of Commerce shall report to the Congress on data 
from such licenses in accordance with section 602(c) of the Nuclear 
Non-Proliferation Act of 1978.
    (c) Advisory Opinions.--(1) Upon the request of any person, the 
Subgroup may, after appropriate consultation, issue an advisory opinion 
in writing to that person as to whether a proposed activity by that 
person would subject that person to sanctions under existing nuclear 
export control laws.
    (2) Issuance of an advisory opinion under paragraph (1) shall not 
exempt any person from compliance with the requirements of this Act.
    (3) For purposes of this subsection, the term ``appropriate 
consultation'' means consultation by the Subgroup with the Secretary of 
State, the Secretary of Defense, the Director of the Arms Control and 
Disarmament Agency, and the heads of such other Federal agencies as the 
Subgroup may determine are necessary.
    (d) Procedures To Expedite License Approvals.--The Subgroup may 
develop and implement procedures to expedite the approvals of licenses 
for nuclear dual-use items to be exported to countries that the 
Subgroup has determined are not engaged, and are unlikely to become 
engaged, in promoting, directly or indirectly, the proliferation of 
nuclear explosive devices if no such procedures would eliminate the 
fundamental requirement of licensing of goods or technology that are 
controlled because of their association with the development, 
acquisition, or use of nuclear explosive devices.
    (e) Procedures To Expedite Licensing Decisions.--Within 12 months 
after the date of enactment of this Act, the Secretary of Commerce, in 
consultation with the members of the Committee, shall develop 
procedures to ensure that applicants for validated licenses for the 
export of nuclear dual-use items will receive notice of approval or 
denial of any such license not later than 60 days after submission of 
an application.

         TITLE III--AMENDMENTS TO THE ATOMIC ENERGY ACT OF 1954

SEC. 301. SUBSEQUENT ARRANGEMENTS.

    Section 131 of the Atomic Energy Act of 1954 (42 U.S.C. 2160) is 
amended--
            (1) by inserting ``and the Secretary of Defense'' after 
        ``concurrence of the Secretary of State'' in subsection a.(1);
            (2) by striking all after ``and shall consult with'' 
        through the colon and inserting ``the Director and the 
        Commission:'';
            (3) in subsection a.(2), by striking ``may'' in the first 
        sentence and inserting ``shall'';
            (4) in subsection b.(1), by inserting after ``such 
        arrangement'' the following ``, including documentation of the 
        technical basis for the Secretary's judgment that such 
        arrangement will ensure timely warning to the United States of 
        any diversion well in advance of the time at which the non-
        nuclear-weapon state could transform the diverted material into 
        a nuclear explosive device,''; and
            (5) in subsection d., by striking all after ``States,'' and 
        inserting in lieu thereof the following: ``and nothing in this 
        section is intended to promote the reprocessing of spent fuel 
        owned by any nation which lacks a reasonable economic 
        justification for such reprocessing''.

SEC. 302. COOPERATION WITH OTHER NATIONS.

    Section 123 a. of the Atomic Energy Act of 1954 (42 U.S.C. 2153) is 
amended--
    (1) by inserting ``and the Secretary of Defense'' after 
``concurrence of the Secretary of Energy''; and
    (2) by striking ``jointly by the Secretary of State and the 
Secretary of Energy'' and inserting ``jointly by the Secretary of 
State, the Secretary of Energy, and the Secretary of Defense''.

SEC. 303. PROHIBITION ON FOREIGN PRODUCTION OF SPECIAL NUCLEAR 
              MATERIAL.

    Section 57 b. of the Atomic Energy Act of 1954 (42 U.S.C. 2077) is 
amended--
            (1) by inserting ``and the Department of Defense'' after 
        ``concurrence of the Department of State''; and
            (2) by striking ``the Department of Commerce, and the 
        Department of Defense'' and inserting ``and the Department of 
        Commerce''.

SEC. 304. PROHIBITION ON NUCLEAR EXPORTS.

    Section 129 of the Atomic Energy Act of 1954 (42 U.S.C. 2158) is 
amended by inserting after ``No nuclear materials and equipment'' the 
following: ``including any items whose export from the United States is 
controlled pursuant to the authorities of this Act, the Nuclear Non-
Proliferation Act of 1978, or the Nuclear Export Reorganization Act of 
1993,''.

SEC. 305. CONTROL OF COMPONENT PARTS.

    Section 109 b. of the Atomic Energy Act of 1954 (42 U.S.C. 2139(b)) 
is amended by inserting ``Defense,'' after ``State,''.

             TITLE IV--SANCTIONS FOR NUCLEAR PROLIFERATION

SEC. 401. IMPOSITION OF SANCTIONS.

    (a) Determination by the President.--
            (1) In general.--Except as provided in subsection (b)(2), 
        the President shall impose the applicable sanctions described 
        in subsection (c) if the President determines that a foreign 
        person or a United States person, on or after the date of 
        enactment of this Act, has materially and with requisite 
        knowledge contributed--
                    (A) through the export from the United States of 
                any goods or technology that are subject to the 
                jurisdiction of the United States, or
                    (B) through the export from any other country of 
                any goods or technology that would be, if they were 
                exported from the United States, subject to the 
                jurisdiction of the United States,
        to the efforts by any individual, group, or non-nuclear-weapon 
        state to acquire unsafeguarded special nuclear material or to 
        use, develop, produce, stockpile, or otherwise acquire any 
        nuclear explosive device, whether or not the goods or 
        technology is specifically designed or modified for that 
        purpose.
            (2) Persons against which sanctions are to be imposed.--
        Sanctions shall be imposed pursuant to paragraph (1) on--
                    (A) the foreign person or United States person with 
                respect to which the President makes the determination 
                described in that paragraph;
                    (B) any successor entity to that foreign person or 
                United States person;
                    (C) any foreign person or United States person that 
                is a parent or subsidiary of that person if that parent 
                or subsidiary materially and with requisite knowledge 
                assisted in the activities which were the basis of that 
                determination; and
                    (D) any foreign person or United States person that 
                is an affiliate of that person if that affiliate 
                materially and with requisite knowledge assisted in the 
                activities which were the basis of that determination 
                and if that affiliate is controlled in fact by that 
                foreign person.
            (3) Other sanctions available.--The sanctions which are 
        required to be imposed for activities described in this 
        subsection are in addition to any other sanction which may be 
        imposed for the same activities under any other provision of 
        law.
            (4) Definition.--For purposes of this subsection, the term 
        ``requisite knowledge'' means situations in which a person 
        ``knows'', as ``knowing'' is defined in section 104 of the 
        Foreign Corrupt Practices Act of 1977 (15 U.S.C. 78dd-2), and 
        includes situations in which a person has reason to know.
    (b) Consultation With and Actions by Foreign Government of 
Jurisdiction.--
            (1) Consultations.--If the President makes a determination 
        described in subsection (a)(1) with respect to a foreign 
        person, the Congress urges the President to initiate 
        consultations immediately with the government with primary 
        jurisdiction over that foreign person with respect to the 
        imposition of sanctions pursuant to this section.
            (2) Actions by government of jurisdiction.--In order to 
        pursue such consultations with that government, the President 
        may delay imposition of sanctions pursuant to this section for 
        up to 90 days. Following these consultations, the President 
        shall impose sanctions unless the President determines and 
        certifies to the Congress that that government has taken 
        specific and effective actions, including appropriate 
        penalties, to terminate the involvement of the foreign person 
        in the activities described in subsection (a)(1). The President 
        may delay the imposition of sanctions for up to an additional 
        90 days if the President determines and certifies to the 
        Congress that that government is in the process of taking the 
        actions described in the preceding sentence.
            (3) Report to congress.--Not later than 90 days after 
        making a determination under subsection (a)(1), the President 
        shall submit to the Committee on Foreign Relations and the 
        Committee on Governmental Affairs of the Senate and the 
        Committee on Foreign Affairs of the House of Representatives a 
        report on the status of consultations with the appropriate 
        government under this subsection, and the basis for any 
        determination under paragraph (2) of this subsection that such 
        government has taken specific corrective actions.
    (c) Sanctions.--
            (1) Description of sanctions.--The sanctions to be imposed 
        pursuant to subsection (a)(1) are, except as provided in 
        paragraph (2) of this subsection, that the United States 
        Government shall not procure, or enter into any contract for 
        the procurement of, any goods or services from any person 
        described in subsection (a)(2).
            (2) Exceptions.--The President shall not be required to 
        apply or maintain sanctions under this section--
                    (A) in the case of procurement of defense articles 
                or defense services--
                            (i) under existing contracts or 
                        subcontracts, including the exercise of options 
                        for production quantities to satisfy 
                        requirements essential to the national security 
                        of the United States;
                            (ii) if the President determines that the 
                        person or other entity to which the sanctions 
                        would otherwise be applied is a sole source 
                        supplier of the defense articles or services, 
                        that the defense articles or services are 
                        essential, and that alternative sources are not 
                        readily or reasonably available; or
                            (iii) if the President determines that such 
                        articles or services are essential to the 
                        national security under defense coproduction 
                        agreements;
                    (B) to products or services provided under 
                contracts entered into before the date on which the 
                President publishes his intention to impose the 
                sanctions;
                    (C) to--
                            (i) spare parts which are essential to 
                        United States products or production;
                            (ii) component parts, but not finished 
                        products, essential to United States products 
                        or production; or
                            (iii) routine servicing and maintenance of 
                        products, to the extent that alternative 
                        sources are not readily or reasonably 
                        available;
                    (D) to information and technology essential to 
                United States products or production; or
                    (E) to medical or other humanitarian items.
    (d) Advisory Opinions.--(1) Upon the request of any person, the 
Secretary of State may, after appropriate consultation, issue an 
advisory opinion in writing to that person as to whether a proposed 
activity by that person would subject that person to sanctions under 
this section.
    (2) Issuance of an advisory opinion under paragraph (1) shall not 
exempt any person from compliance with the requirements of this Act.
    (3) For purposes of this subsection, the term ``appropriate 
consultation'' means consultation by the Secretary of State with the 
Secretary of Defense, the Director of the Arms Control and Disarmament 
Agency, and the heads of such other Federal agencies as the Secretary 
of State may determine are necessary.
    (e) Termination of Sanctions.--The sanctions imposed pursuant to 
this section shall apply for a period of at least 12 months following 
the imposition of sanctions and shall cease to apply thereafter only if 
the President determines and certifies to the Congress that--
            (1) reliable information indicates that the foreign person 
        or United States person with respect to which the determination 
        was made under subsection (a)(1) has ceased to aid or abet any 
        individual, group, or non-nuclear-weapon state in its efforts 
        to acquire unsafeguarded special nuclear material or any 
        nuclear explosive device, as described in that subsection; and
            (2) the President has received reliable assurances from the 
        foreign person or United States person, as the case may be, 
        that such person will not, in the future, aid or abet any 
        individual, group, or non-nuclear-weapon state in its efforts 
        to acquire unsafeguarded special nuclear material or any 
        nuclear explosive device, as described in subsection (a)(1).
    (f) Waiver.--
            (1) Criterion for waiver.--The President may waive the 
        application of any sanction imposed on any person pursuant to 
        this section, after the end of the 12-month period beginning on 
        the date on which that sanction was imposed on that person, if 
        the President determines and certifies to the Congress that the 
        continued imposition of the sanction would have a serious 
        adverse effect on vital United States interests.
            (2) Notification of and report to congress.--If the 
        President decides to exercise the waiver authority provided in 
        paragraph (1), the President shall so notify the Congress not 
        less than 20 days before the waiver takes effect. Such 
        notification shall include a report fully articulating the 
        rationale and circumstances which led the President to exercise 
        the waiver authority.
    (g) Definitions.--For purposes of this section--
            (1) the term ``foreign person'' means--
                    (A) an individual who is not a citizen of the 
                United States or an alien admitted for permanent 
                residence to the United States; or
                    (B) a corporation, partnership, or other 
                nongovernment entity which is created or organized 
                under the laws of a foreign country or which has its 
                principal place of business outside the United States; 
                and
            (2) the term ``United States person'' means--
                    (A) an individual who is a citizen of the United 
                States or an alien admitted for permanent residence to 
                the United States; or
                    (B) a corporation, partnership, or other entity 
                which is not a foreign person.

SEC. 402. ELIGIBILITY FOR ASSISTANCE.

    (a) Amendments to the Arms Export Control Act.--(1) Section 3 of 
the Arms Export Control Act (22 U.S.C. 2753) is amended by adding at 
the end the following new subsection:
    ``(f) No sales or leases shall be made under this Act to any 
country that the President has determined is in material breach of its 
commitments to the United States under international treaties or 
agreements concerning the nonproliferation of nuclear explosive devices 
(as defined in section 3(9) of the Nuclear Export Reorganization Act of 
1993) and unsafeguarded special nuclear material (as defined in section 
3(13) of that Act).''.
    (2) Section 40 of such Act (22 U.S.C. 2780) is amended--
            (A) in subsection (d), by adding at the end the following 
        new sentence: ``For purposes of this subsection, such acts 
        shall include any activity that the Secretary determines 
        willfully aids or abets the international proliferation of 
        nuclear explosive devices to an individual or group or 
        willfully aids or abets an individual or group in acquiring 
        unsafeguarded special nuclear material.''; and
            (B) in subsection (l)--
                    (i) in paragraph (2), by striking ``and'' after the 
                semicolon;
                    (ii) in paragraph (3), by striking the period at 
                the end and inserting a semicolon; and
                    (iii) by adding at the end the following:
            ``(4) the term `nuclear explosive device' has the meaning 
        given that term in section 3(9) of the Nuclear Export 
        Reorganization Act of 1993; and
            ``(5) the term `unsafeguarded special nuclear material' has 
        the meaning given that term in section 3(13) of the Nuclear 
        Export Reorganization Act of 1993.''.
    (b) Amendments to the Foreign Assistance Act of 1961.--
            (1) Section 670(a)(2) of the Foreign Assistance Act of 1961 
        (22 U.S.C. 2429a(a)(2)) is amended in the first sentence--
                    (A) by inserting ``in any fiscal year'' after 
                ``President''; and
                    (B) by inserting ``during that fiscal year'' after 
                ``certifies in writing''.
            (2) Notwithstanding any other provision of law, 
        Presidential Determination No. 82-7 of February 10, 1982, shall 
        have no force or effect with respect to any grounds for the 
        prohibition of assistance under section 670(a)(1) of such Act 
        arising on or after the date of enactment of this Act.
            (3) Section 620E(d) of the Foreign Assistance Act of 1961 
        (22 U.S.C. 2375(d)) is amended to read as follows:
    ``(d) The President may waive the prohibitions of section 669 of 
this Act with respect to any grounds for the prohibition of assistance 
under that section arising before the date of enactment of the Nuclear 
Export Reorganization Act of 1993 to provide assistance to Pakistan if 
he determines that to do so is in the national interest of the United 
States.''.

SEC. 403. ROLE OF INTERNATIONAL FINANCIAL INSTITUTIONS.

    (a) In General.--The Secretary of the Treasury shall instruct the 
United States executive director to each of the international financial 
institutions described in section 701(a) of the International Financial 
Institutions Act (22 U.S.C. 262d(a)) to use the voice and vote of the 
United States to oppose any direct or indirect use of the institution's 
funds to promote the acquisition of unsafeguarded special nuclear 
material or the development, stockpiling, or use of any nuclear 
explosive device by any non-nuclear-weapon state.
    (b) Duties of United States Executive Directors.--Section 701(b)(3) 
of the International Financial Institutions Act (22 U.S.C. 262d(b)(3)) 
is amended to read as follows:
            ``(3) whether the recipient country--
                    ``(A) has been found by the President to be seeking 
                to acquire unsafeguarded special nuclear material (as 
                defined in section 3(13) of the Nuclear Export 
                Reorganization Act of 1993) or a nuclear explosive 
                device (as defined in section 3(9) of that Act);
                    ``(B) is not a State Party to the Treaty on Non-
                Proliferation of Nuclear Weapons; or
                    ``(C) has detonated a nuclear explosive device; 
                and''.

SEC. 404. AMENDMENT TO THE INTERNATIONAL EMERGENCY ECONOMIC POWERS ACT.

    Section 202 of the International Emergency Economic Powers Act (50 
U.S.C. 1701) is amended by adding at the end thereof the following new 
subsection:
    ``(c) For the purpose of this section, the term `any unusual and 
extraordinary threat' includes any international event that the 
President determines may involve the detonation of a nuclear explosive 
device (as defined in section 3(9) of the Nuclear Export Reorganization 
Act of 1993) or an action or activity that substantially contributes to 
the likelihood of the proliferation or detonation of such devices, 
including the acquisition by a non-nuclear-weapon state of 
unsafeguarded special nuclear material (as defined in section 3(13) of 
that Act).''.

SEC. 405. AMENDMENT TO THE FEDERAL DEPOSIT INSURANCE CORPORATION 
              IMPROVEMENT ACT OF 1991.

    The Federal Deposit Insurance Corporation Improvement Act of 1991 
is amended by adding at the end the following new title:

            ``TITLE VI--SANCTIONS ON FINANCIAL INSTITUTIONS

``SEC. 601. PRESIDENTIAL DETERMINATION.

    ``(a) In General.--The prohibitions in section 603 shall be imposed 
on a financial institution if the President determines that such 
financial institution, on or after the date which is 60 days after the 
date of enactment of this section, has materially and with requisite 
knowledge contributed, through provision of financing or other 
services, to the efforts by any individual, group, or non-nuclear-
weapon state to acquire unsafeguarded special nuclear material or to 
use, develop, produce, stockpile, or otherwise acquire any nuclear 
explosive device, as these standards and terms would be applied under 
section 401(a) of the Nuclear Export Reorganization Act of 1993.
    ``(b) Presidential Order.--Whenever the President makes a 
determination under subsection (a) with respect to a financial 
institution, the President shall issue an order specifying a date 
within 180 days after such determination on which the prohibitions in 
section 603 shall begin to apply to such institution.

``SEC. 602. ADDITIONAL ENTITIES AGAINST WHICH SANCTIONS ARE TO BE 
              IMPOSED.

    ``The prohibitions described in section 603 shall also be imposed, 
pursuant to section 601, on--
            ``(1) any successor entity to the financial institution 
        with respect to which the President makes a determination under 
        section 601(a);
            ``(2) any foreign person or United States person that is a 
        parent or subsidiary of that financial institution if that 
        parent or subsidiary materially and with requisite knowledge 
        assisted in the activities which were the basis of that 
        determination; and
            ``(3) any foreign person or United States person that is an 
        affiliate of that financial institution if that affiliate 
        materially and with requisite knowledge assisted in the 
        activities which were the basis of such determination and if 
        that affiliate is controlled in fact by that financial 
        institution.

``SEC. 603. PROHIBITIONS.

    ``The following prohibitions shall apply to a financial institution 
with respect to which a determination is made under section 601(a) and 
to the entities described in section 602:
            ``(1) Ban on dealings in government finance.--
                    ``(A) Designation as primary dealer.--Neither the 
                Board of Governors of the Federal Reserve System nor 
                the Federal Reserve Bank of New York may designate, or 
                permit the continuation of any prior designation of, 
                such financial institution or any such entity as a 
                primary dealer in United States Government debt 
                instruments.
                    ``(B) Government funds.--Such financial institution 
                or any such entity shall not serve as agent of the 
                United States Government or serve as repository for 
                United States Government funds.
            ``(2) Restrictions on operations.--Such financial 
        institution or any such entity shall not, directly or 
        indirectly--
                    ``(A) commence any line of business in the United 
                States in which it was not engaged as of the date of 
                the determination; or
                    ``(B) conduct business from any location in the 
                United States at which it did not conduct business as 
                of the date of the determination.

``SEC. 604. CONDITIONS AND TERMINATION OF SANCTIONS.

    ``The same requirements for consultation with the foreign 
government of jurisdiction, where appropriate, and for termination of 
sanctions shall apply under this title as are provided in subsections 
(b) and (e), respectively, of section 401 of the Nuclear Export 
Reorganization Act of 1993.

``SEC. 605. WAIVER.

    ``The President may waive the imposition of any prohibition imposed 
on any financial institution or other entity pursuant to section 601 or 
602 if the President determines and certifies to the Congress that the 
imposition of such prohibition would have a serious adverse effect on 
the safety and soundness of the domestic or international financial 
system or on domestic or international payments systems.

``SEC. 606. DEFINITIONS.

    ``As used in this title--
            ``(1) the term `financial institution' includes--
                    ``(A) a depository institution, including a branch 
                or agency of a foreign bank;
                    ``(B) a securities firm, including a broker or 
                dealer;
                    ``(C) an insurance company, including an agency or 
                underwriter;
                    ``(D) any other company that provides financial 
                services; or
                    ``(E) any subsidiary of any entity described in 
                subparagraph (A), (B), (C), or (D);
            ``(2) the term `requisite knowledge' means situations in 
        which a person `knows', as `knowing' is defined in section 104 
        of the Foreign Corrupt Practices Act of 1977 (15 U.S.C. 78dd-
        2), and includes situations in which a person has reason to 
        know; and
            ``(3) the terms `foreign person' and `United States person' 
        have the meanings given those terms in section 401(g) of the 
        Nuclear Export Reorganization Act of 1993.''.

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

    Section 2(b)(4) of the Export-Import Bank Act of 1945 (12 U.S.C. 
635(b)(4)) is amended in the first sentence by inserting after 
``device'' the following: ``(as defined in section 3(9) of the Nuclear 
Export Reorganization Act of 1993), or that any country has willfully 
aided or abetted any non-nuclear-weapon state (as defined in section 
3(7) of that Act) to acquire any such nuclear explosive device or to 
acquire unsafeguarded special nuclear material (as defined in section 
3(13) of that Act).''.

SEC. 407. ADDITIONAL AMENDMENTS TO THE FOREIGN ASSISTANCE ACT OF 1961.

    (a) Additional Sanctions.--Section 670 of the Foreign Assistance 
Act of 1961 (22 U.S.C. 2429a(b)) is amended--
            (1) in subsection (b), by redesignating paragraphs (2), 
        (3), and (4) as paragraphs (4), (5), and (6), respectively; and
            (2) by amending subsection (b)(1) to read as follows:
    ``(b)(1) Except as provided in paragraphs (4), (5), and (6), in the 
event that the President determines that any country, after the date of 
enactment of the Nuclear Export Reorganization Act of 1993--
            ``(A) transfers to a non-nuclear-weapon state a nuclear 
        explosive device,
            ``(B) is a non-nuclear-weapon state and either--
                    ``(i) receives a nuclear explosive device, or
                    ``(ii) detonates a nuclear explosive device,
            ``(C) transfers to a non-nuclear-weapon state any design 
        information or component which is determined by the President 
        to be important to, and known by the transferring country to be 
        intended by the recipient state for use in, the development or 
        manufacture of any nuclear explosive device, or
            ``(D) is a non-nuclear-weapon state and has sought and 
        received any design information or component which is 
        determined by the President to be important to, and intended by 
        the recipient state for use in, the development or manufacture 
        of any nuclear explosive device,
then the President shall forthwith report in writing his determination 
to the Congress and shall forthwith impose the sanctions described in 
paragraph (2) against that country.
    ``(2) The sanctions referred to in paragraph (1) are as follows:
            ``(A) The United States Government shall terminate 
        assistance to that country under this Act, except for 
        humanitarian assistance or food or other agricultural 
        commodities.
            ``(B) The United States Government shall terminate--
                    ``(i) sales to that country under the Arms Export 
                Control Act of any defense articles, defense services, 
                or design and construction services, and
                    ``(ii) licenses for the export to that country of 
                any item on the United States Munitions List.
            ``(C) The United States Government shall terminate all 
        foreign military financing for that country under the Arms 
        Export Control Act.
            ``(D) The United States Government shall deny to that 
        country any credit, credit guarantees, or other financial 
        assistance by any department, agency, or instrumentality of the 
        United States Government, except that the sanction of this 
        subparagraph shall not apply--
                    ``(i) to any transaction subject to the reporting 
                requirements of title V of the National Security Act of 
                1947 (relating to congressional oversight of 
                intelligence activities), or
                    ``(ii) to humanitarian assistance.
            ``(E) The United States Government shall oppose, in 
        accordance with section 701 of the International Financial 
        Institutions Act (22 U.S.C. 262d), the extension of any loan or 
        financial or technical assistance to that country by any 
        international financial institution.
            ``(F) The United States Government shall prohibit any 
        United States bank from making any loan or providing any credit 
        to the government of that country, except for loans or credits 
        for the purpose of purchasing food or other agricultural 
        commodities.
            ``(G) The President shall prohibit exports to that country 
        of all goods and technology (excluding food and other 
        agricultural commodities), except that such prohibition shall 
        not apply to any transaction subject to the reporting 
        requirements of title V of the National Security Act of 1947 
        (relating to congressional oversight of intelligence 
        activities).
    ``(3) As used in this subsection--
            ``(A) the term `design information' means information that 
        relates to the design of a nuclear explosive device and that is 
        not available to the public; and
            ``(B) the term `component' means a component of a nuclear 
        explosive device.''.
    (b) Definition of Nuclear Explosive Device.--Section 644 of the 
Foreign Assistance Act of 1961 (22 U.S.C. 2403) is amended by adding at 
the end the following:
    ``(q) `Nuclear explosive device' has the meaning given that term in 
section 3(9) of the Nuclear Export Reorganization Act of 1993.''.
    (c) Conforming Amendments.--Section 670(b) of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2429a(b)) is further amended--
            (1) in paragraph (4) (as redesignated by subsection (a)(1) 
        of this section)--
                    (A) in subparagraph (A)--
                            (i) by striking ``furnish assistance which 
                        would otherwise be prohibited under paragraph 
                        (1)'' and inserting ``delay the imposition of 
                        sanctions which would otherwise be required 
                        under paragraph (1)(A) or (1)(B)'';
                            (ii) by striking ``, before furnishing such 
                        assistance, the President'' and inserting ``the 
                        President first''; and
                            (iii) by striking ``termination of 
                        assistance to'' and inserting ``imposition of 
                        sanctions on'';
                    (B) in subparagraph (B) by striking ``(3)'' and 
                inserting ``(5)''; and
                    (C) in subparagraph (E)--
                            (i) by striking ``(b)(2)'' and inserting 
                        ``(b)(4)''; and
                            (ii) by striking ``(b)(3)'' and inserting 
                        ``(b)(5)'';
            (2) in paragraph (5) (as so redesignated)--
                    (A) by striking ``(2)'' and inserting ``(4)'';
                    (B) by striking ``furnish assistance which would 
                otherwise be prohibited under paragraph (1)'' and 
                inserting ``waive any sanction which would otherwise be 
                required under paragraph (1)(A) or (1)(B)''; and
                    (C) by striking ``termination of such assistance'' 
                and inserting ``imposition of such sanction'';
            (3) by redesignating paragraph (6) (as so redesignated) as 
        paragraph (7); and
            (4) by inserting after paragraph (5) (as so redesignated) 
        the following:
            ``(6) Notwithstanding any other provision of law, the 
        sanctions which are required to be imposed against a country 
        under paragraph (1)(C) or (1)(D) shall not apply if the 
        President determines and certifies in writing to the Committee 
        on Foreign Relations and the Committee on Governmental Affairs 
        of the Senate and the Committee on Foreign Affairs of the House 
        of Representatives that the application of such sanctions 
        against such country would have a serious adverse effect on 
        vital United States interests. The President shall transmit 
        with such certification a statement setting forth the specific 
        reasons therefor.''.

SEC. 408. REWARD.

    Section 36(a) of the State Department Basic Authorities Act of 1956 
(22 U.S.C. 2708(a)) is amended--
            (1) by redesignating paragraphs (1) through (3) as 
        subparagraphs (A) through (C), respectively;
            (2) by inserting ``(1)'' after ``(a)''; and
            (3) by adding at the end the following:
            ``(2) For purposes of this subsection, the term `act of 
        international terrorism' includes any act substantially 
        contributing to the acquisition of unsafeguarded special 
        nuclear material (as defined in section 3(13) of the Nuclear 
        Export Reorganization Act of 1993) or any nuclear explosive 
        device (as defined in section 3(9) of that Act) by an 
        individual or group.''.

SEC. 409. REPORTS.

    (a) Content of ACDA Annual Report.--Section 52 of the Arms Control 
and Disarmament Act (22 U.S.C. 2592) is amended--
            (1) by inserting ``(a) In General.--'' before ``The 
        Congress'';
            (2) by striking ``and'' at the end of paragraph (4);
            (3) by striking the period at the end of paragraph (5) and 
        inserting ``; and'';
            (4) by adding after paragraph (5) the following new 
        paragraph:
            ``(6) a section of the report shall deal with any material 
        noncompliance by foreign governments with their commitments to 
        the United States with respect to the prevention of the spread 
        of nuclear explosive devices (as defined in section 3(9) of the 
        Nuclear Export Reorganization Act of 1993) by non-nuclear-
        weapon states (as defined in section 3(7) of that Act) or the 
        acquisition by such states of unsafeguarded special nuclear 
        material (as defined in section 3(13) of that Act), including--
                    ``(A) a net assessment of the aggregate military 
                significance of all such violations;
                    ``(B) a statement of the compliance policy of the 
                United States with respect to violations of those 
                commitments; and
                    ``(C) what actions, if any, the President has taken 
                or proposes to take to bring any nation committing such 
                a violation into compliance with its commitments.''; 
                and
            (5) by adding at the end the following new subsection:
    ``(b) Reporting Consecutive Noncompliance.--If the President in 
consecutive reports submitted to the Congress under this section 
reports that any designated nation is not in full compliance with its 
nonproliferation commitments to the United States, then the President 
shall include in the second such report an assessment of what actions 
are necessary to compensate for such violations.''.
    (b) Reporting on Demarches.--(1)(A) Not later than six months after 
the date of enactment of this Act, the President shall submit to the 
congressional committees specified in section 602(c) of the Nuclear 
Non-Proliferation Act of 1978 an unclassified report that shall state 
the number of high-level demarches that was issued or received by the 
United States with respect to activities related to the proliferation 
of nuclear explosive devices.
    (B) The report described in subparagraph (A) shall cover demarches 
issued or received during the period beginning January 1, 1981, and 
ending December 31, 1993, and shall identify for each demarche the 
foreign country issuing or receiving the demarche, as the case may be.
    (2)(A) Section 601(a) of the Nuclear Non-Proliferation Act of 1978 
(22 U.S.C. 3281(a)), as amended by section 101, is further amended--
            (i) in paragraph (5), by striking ``and'' after the 
        semicolon;
            (ii) in paragraph (6), by striking the period and inserting 
        ``; and''; and
            (iii) by adding after paragraph (6) the following new 
        paragraph:
            ``(7) a statement of the number of all high-level demarches 
        (as defined in section 209(b)(4) of the Omnibus Nuclear 
        Proliferation Control Act of 1993) issued by or received by the 
        United States with respect to activities related to the 
        proliferation of nuclear explosive devices, and shall identify 
        each foreign country issuing or receiving such a demarche, in 
        the preceding calendar year.''.
    (B) The amendments made by subparagraph (A) shall take effect on 
January 1, 1995.
    (3) It is the sense of the Congress that the Department of State 
should, in the course of implementing its reporting responsibilities 
under section 602(c) of the Nuclear Non-Proliferation Act of 1978, 
include a summary of all demarches that the United States has issued or 
received from foreign governments with respect to activities which are 
of significance from the proliferation standpoint.
    (4) For purposes of this subsection, the term ``high-level 
demarche'' means any official communication by one government to 
another at the presidential, vice presidential, ministerial, or 
ambassadorial level, by written or oral means, intended by the 
originating government to express--
            (A) a concern over a past, present, or possible future 
        action or activity of the recipient government, or of a person 
        within the jurisdiction of that government, contributing to the 
        global spread of unsafeguarded special nuclear material or of 
        nuclear explosive devices;
            (B) a request for the recipient government to counter such 
        action or activity; or
            (C) both the concern and request described in subparagraphs 
        (A) and(B).

SEC. 410. TECHNICAL CORRECTION.

    Section 133 b. of the Atomic Energy Act of 1954 (42 U.S.C. 2160c) 
is amended by striking ``20 kilograms'' and inserting ``5 kilograms''.

              TITLE V--INTERNATIONAL ATOMIC ENERGY AGENCY

SEC. 501. BILATERAL AND MULTILATERAL INITIATIVES.

    It is the sense of the Congress that in order to maintain and 
enhance international confidence in the effectiveness of IAEA 
safeguards and in other multilateral undertakings to halt the global 
proliferation of nuclear explosive devices and associated technology, 
the United States should seek to negotiate with other nations and 
groups of nations, including the IAEA Board of Governors and the 
Nuclear Suppliers Group, to--
            (1) build international support for the principle that each 
        nuclear supply relationship involving a non-nuclear weapon 
        state must include a commitment by such state to the 
        application of full-scope international safeguards;
            (2) encourage each nuclear-weapon state within the meaning 
        of the Treaty on the Non-Proliferation of Nuclear Weapons to 
        undertake a comprehensive review of its own procedures for 
        declassifying information relating to the design or production 
        of nuclear explosive devices and to investigate any measures 
        that would reduce the risk of such information contributing to 
        the proliferation of such devices;
            (3) encourage the deferral of efforts to separate plutonium 
        or enrich uranium to 20 percent uranium-235 or more;
            (4) pursue greater financial support for the implementation 
        and improvement of safeguards from all IAEA member nations with 
        significant nuclear programs, particularly from those nations 
        that are currently using or planning to use direct-use material 
        for commercial purposes;
            (5) arrange for the timely payment of annual financial 
        contributions by all members of the IAEA, including the United 
        States;
            (6) discourage international commerce in highly enriched 
        uranium for use in research reactors while encouraging 
        multilateral cooperation to develop and to use low-enriched 
        alternative nuclear fuels;
            (7) oppose efforts by non-nuclear-weapon states to develop 
        or use unsafeguarded nuclear fuels for purposes of naval 
        propulsion;
            (8) pursue an international arrangement that would 
        authorize the IAEA to operate surveillance aircraft and would 
        facilitate IAEA access to satellite information for safeguards 
        verification purposes;
            (9) develop an institutional means for IAEA member nations 
        to share information with the IAEA on possible safeguards 
        violations;
            (10) require any exporter of a sensitive nuclear facility 
        or sensitive nuclear technology to notify the IAEA prior to 
        export and to require safeguards over that facility or 
        technology, regardless of its destination;
            (11) seek agreement among the parties to the Treaty to 
        apply IAEA safeguards in perpetuity and to consider the 
        establishment of new limits on the right to withdraw from the 
        Treaty;
            (12) encourage other nations to adopt legislation that 
        would tighten penalties against companies and individuals that 
        knowingly and materially assist any non-nuclear-weapon state or 
        group to acquire a nuclear explosive device;
            (13) encourage the creation under IAEA auspices of 
        international repositories for the long-term storage of spent 
        nuclear fuel; and
            (14) develop measures to ensure the safe and long-term 
        storage under international auspices of special fissionable 
        material recovered as a consequence of nuclear disarmament 
        accords.

SEC. 502. REFORMS IN IAEA SAFEGUARDS.

    In order to promote the early adoption of reforms in the 
implementation of the safeguards responsibilities of the IAEA, the 
Congress urges the President to negotiate with other nations and groups 
of nations, including the IAEA Board of Governors and the Nuclear 
Suppliers Group, to--
            (1) improve the access of the IAEA within non-nuclear 
        weapon states to nuclear facilities that are capable of 
        producing, processing, or fabricating special fissionable 
        material suitable for use in a nuclear explosive device;
            (2)(A) facilitate the IAEA's efforts to meet and to 
        maintain its own goals for detecting the diversion of nuclear 
        materials and equipment, giving particular attention to 
        facilities in which there are bulk quantities of plutonium; and
            (B) if it is not technically feasible for the IAEA to meet 
        those detection goals in a particular facility, require the 
        IAEA to declare publicly that it is unable to do so;
            (3) enable the IAEA to issue fines for violations of 
        safeguards procedures, to pay rewards for information on 
        possible safeguards violations, and to establish a `hot line' 
        for the reporting of such violations and other illicit uses of 
        direct-use material;
            (4) examine the feasibility of applying safeguards at 
        facilities engaged in the manufacture of equipment or material 
        that is especially designed or prepared for the processing, 
        use, or production of special fissionable material or, in the 
        case of non-nuclear-weapon states, of any nuclear explosive 
        device;
            (5) examine the feasibility of applying safeguards over 
        research and development activities and facilities involving 
        sensitive nuclear technology, as defined in section 4(a)(6) of 
        the Nuclear Non-Proliferation Act of 1978, or any other 
        technology directly related to the acquisition or production of 
        nuclear explosive devices;
            (6) implement special inspections of undeclared nuclear 
        facilities, as provided for under existing safeguards 
        procedures, and seek authority for the IAEA to conduct short-
        notice inspections on demand at suspected nuclear sites;
            (7) expand the scope of safeguards to include tritium, 
        uranium concentrates, and nuclear waste containing significant 
        quantities of special fissionable material, and increase the 
        scope of such safeguards on heavy water;
            (8) revise downward the IAEA's official minimum amounts of 
        nuclear material (``significant quantity'') needed to make a 
        nuclear explosive device and establish these amounts as 
        national rather than facility standards;
            (9) expand the use of full-time resident IAEA inspectors at 
        sensitive fuel cycle facilities;
            (10) require the use of near real time material accountancy 
        in the conduct of safeguards at facilities that use, produce, 
        or store significant quantities of special fissionable 
        material;
            (11) develop with other IAEA member nations an agreement on 
        procedures to expedite approvals of visa applications by IAEA 
        inspectors;
            (12) provide the IAEA the additional funds, technical 
        assistance, and political support necessary to carry out the 
        goals set forth in this subsection; and
            (13) make public the annual safeguards implementation 
        report of the IAEA, establishing a public registry of 
        commodities in international nuclear commerce, including dual-
        use goods, and creating a public repository of current nuclear 
        trade control laws, agreements, regulations, and enforcement 
        and judicial actions by IAEA member nations.

SEC. 503. REPORTING REQUIREMENT.

    (a) Report Required.--The President shall, in the report required 
by section 601(a) of the Nuclear Non-Proliferation Act of 1978, 
describe--
            (1) the steps he has taken to implement sections 501 and 
        502, and
            (2) the progress that has been made and the obstacles that 
        have been encountered in seeking to meet the objectives set 
        forth in sections 501 and 502.
    (b) Contents of Report.--Each report under paragraph (1) shall 
describe--
            (1) the bilateral and multilateral initiatives that the 
        President has taken during the period since the enactment of 
        this Act in pursuit of each of the objectives set forth in 
        sections 501 and 502;
            (2) any obstacles that have been encountered in the pursuit 
        of those initiatives;
            (3) any additional initiatives that have been proposed by 
        other countries or international organizations to strengthen 
        the implementation of IAEA safeguards;
            (4) all activities of the Federal Government in support of 
        the objectives set forth in sections 501 and 502;
            (5) any recommendations of the President on additional 
        measures to enhance the effectiveness of IAEA safeguards; and
            (6) any initiatives that the President plans to take in 
        support of each of the objectives set forth in sections 501 and 
        502.

                TITLE VI--REVIEW OF PLUTONIUM USE POLICY

SEC. 601. FINDINGS AND DECLARATIONS.

    The Congress finds and declares that--
            (1) reactor-grade plutonium is a direct-use material;
            (2) plutonium in all forms is hazardous to the human and 
        natural environment and is a potential radiological weapon;
            (3) nuclear reprocessing programs that produce, or are 
        intended to produce, large amounts of plutonium, especially 
        amounts of plutonium that exceed the reasonable economic needs 
        of a country, for civilian uses jeopardize the efforts of the 
        United States, other nations, and international organizations 
        to reduce the global risks of nuclear weapons proliferation, 
        nuclear terrorism, and environmental contamination;
            (4) the United States Government has suspended the 
        production of military plutonium and has abandoned civil 
        reprocessing and breeder reactor development in the United 
        States;
            (5) more than 500 metric tons of plutonium currently exist 
        in civilian nuclear fuel worldwide, more than 100 metric tons 
        of plutonium have already been separated from nuclear fuel 
        irradiated in civilian reactors, and more than 200 metric tons 
        of plutonium exist in declared nuclear weapons stockpiles;
            (6) on July 16, 1981, the President announced a policy that 
        the United States ``will not inhibit or set back civil 
        reprocessing and breeder reactor development in nations with 
        advanced nuclear power programs where it does not constitute a 
        proliferation risk'';
            (7) much of the world surplus of civil plutonium has 
        resulted from foreign nuclear reprocessing activities 
        undertaken pursuant to agreements for nuclear cooperation with 
        the United States that were negotiated or sustained under this 
        policy and that grant long-term United States approval for 
        civilian uses of plutonium recovered from United States-
        supplied nuclear fuel;
            (8) large amounts of additional civil plutonium, far 
        exceeding the amounts of plutonium now contained in nuclear 
        weapons, may soon be recovered in reprocessing plants that are 
        about to be started up or constructed in the European Community 
        and Japan under this policy;
            (9) once these new plants start up and become contaminated 
        with radiation, the environmental difficulties of shutdown and 
        clean-up increase dramatically;
            (10) abundant and inexpensive global sources of uranium and 
        uranium enrichment services have steadily eroded the economic 
        need for the use of plutonium in civilian nuclear reactors;
            (11) breeder reactors were once supposed to be the 
        principal consumers of civil plutonium but have now encountered 
        major financial and technical problems and recently have been 
        abandoned or shut down in Germany, France, and Britain and have 
        suffered major delays in Japan;
            (12) reprocessing was once regarded as an economic and 
        efficient approach to nuclear fuel recycling and waste 
        management but is now widely recognized as extremely costly and 
        posing major environmental hazards; and
            (13) the Deputy Director of the International Atomic Energy 
        Agency has recently stated that ``the excess of plutonium from 
        civilian nuclear programs poses a major political and security 
        problem worldwide''.

SEC. 602. REPORT.

    The President shall--
            (1) reexamine the policy described in section 601(6); and
            (2) not later than 90 days after the date of enactment of 
        this Act--
                    (A) take account of the significant changes in the 
                global security environment and in the global nuclear 
                market since 1981 by modifying the policy described in 
                section 601(6) to avoid the political and security 
                problems associated with excess plutonium from civilian 
                nuclear programs in the world; and
                    (B) submit a report to the Congress describing the 
                steps taken to modify the policy.

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