[Federal Register Volume 62, Number 70 (Friday, April 11, 1997)]
[Rules and Regulations]
[Pages 17683-17698]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-9063]



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  Federal Register / Vol. 62, No. 70 / Friday, April 11, 1997 / Rules 
and Regulations  

[[Page 17683]]


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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 25, 50, 54 and 95

RIN 3150-AF37


Access to and Protection of Classified Information

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
regulations to conform the requirements for the protection of and 
access to classified information to new national security policy 
documents. This final rule is necessary to ensure that classified 
information in the possession of NRC licensees and others under the 
NRC's regulatory requirements is protected in accordance with current 
national policies.

EFFECTIVE DATE: May 12, 1997.

FOR FURTHER INFORMATION CONTACT: Duane G. Kidd, Division of Security, 
Office of Administration, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, telephone (301) 415-7403, Email [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    On August 5, 1996 (61 FR 40555), the NRC published a proposed rule 
in the Federal Register to amend 10 CFR Parts 25 and 95 pertaining to 
the protection of Restricted Data and classified National Security 
Information at licensee, certificate holder and other facilities. The 
proposed amendments were intended to conform NRC regulations to new 
national requirements for the protection of and access to classified 
National Security Information that were revised by the issuance of the 
National Industrial Security Program Operating Manual (NISPOM), 
Executive Order (E.O.) 12958, ``Classified National Security 
Information,'' dated April 17, 1995, and E.O. 12968, ``Access to 
Classified Information,'' dated August 2, 1995. The requirements of 10 
CFR Parts 25 and 95, and the sections of Parts 50 and 54 that contain 
requirements for access to Restricted Data, were substantially based on 
E.O. 12356, dated April 6, 1982, which was superseded by E.O. 12958 and 
supplemented by the NISPOM.
    The final rule amends the provisions of 10 CFR Parts 25, 50, 54, 
and 95 that deal with requirements for access to and protection of 
classified information that have been changed or added by the NISPOM or 
the Executive Orders with the exception of those requirements related 
to personnel security clearance for access to Secret Restricted Data.
    The proposed rule would have permitted, in Secs. 25.15 and 95.35, 
access to most Secret Restricted Data, other than that defined as 
Critical Secret Restricted Data in the NISPOM and its supplement, with 
an ``L'' clearance based on a National Agency Check with Inquiries and 
Credit Check (NACIC). The Department of Energy (DOE) objected to this 
change in their formal comments on the proposed rule. DOE believes 
that, pending completion of the Joint DOE/DoD Nuclear Weapons Access 
Authorization Review Group determination of what constitutes the most 
sensitive Restricted Data, the subsequent review of all classification 
guidance to determine if the guidance contains this type of 
information, and the upgrading of this information to Top Secret, all 
personnel with access to Secret Restricted Data must have a ``Q'' 
clearance based on a Single Scope Background Investigation (SSBI). 
Given DOE's special statutory authorities in establishing controls for 
Restricted Data, their views deserve special consideration. However, 
because this requirement may exceed the requirements of applicable 
National Policy (i.e., the NISPOM), and result in additional costs to 
licensees and certificate holders, the NRC has decided to withdraw the 
changes to Secs. 25.15 and 95.35 in this final rulemaking and to 
republish them separately for additional public comment. This will 
provide interested parties an equal opportunity to address the issues 
and provide supporting rationale for their recommendations and 
comments.
    Other aspects of the proposed rule were generally acceptable to all 
commenters. Those changes included revised and added definitions such 
as Cognizant Security Agency, Classified National Security Information, 
Classified Information, Facility Security Clearance, Foreign Ownership, 
Control, or Influence as well as numerous amendments to reflect the 
fact that the NRC may permit another Cognizant Security Agency (DOE, 
DoD, or CIA) to assume some or all of the security oversight functions 
at an NRC facility under the requirements of 10 CFR Parts 25 and/or 95 
when that agency also has a significant security interest at the 
facility (Secs. 25.13, 25.17, 25.19, 25.21, 25.23, 25.25, 25.27, 25.29, 
25.33, 95.17, 95.18, 95.19, 95.25, 95.27, 95.29, 95.31, 95.33, 95.37, 
95.39, 95.43, 95.47, 95.49, 95.51, 95.53, 95.57 and 95.59). The final 
rule addresses the intent of E.O. 12829, ``National Industrial Security 
Program,'' to reduce wasteful and inefficient duplicative oversight of 
private facilities which have classified interests from more than one 
government agency.
    The final rule also adopts new requirements in areas where the 
Executive Orders or the NISPOM, mandate specific requirements not 
included in the previous versions of the rules. These new requirements 
include:
    Requiring that key management personnel have access authorizations 
as well as those employees with access to classified information 
(Secs. 95.17 and 95.18);
    Permitting reinstatement of an access authorization up to 24 months 
after termination instead of the previous 6 months(Sec. 25.29);
    Permitting facility security officers to issue visit authorization 
letters directly rather than processing authorization requests through 
the NRC Division of Security (Sec. 25.35);
    Requiring a finding that a facility is not under foreign ownership, 
control or influence (Secs. 95.15 and 95.17);
    Requiring facility security officers to have specific training 
related to their position (Sec. 95.33);
    Permitting the use of reinforced steel filing cabinets with 
lockbars and key locks for classified information (provided appropriate 
supplemental protection is in place during non-working hours) 
(Sec. 95.25);

[[Page 17684]]

    Changing the security classification markings to conform to E.O. 
12958 (Sec. 95.37);
    Reducing the accountability requirements for Secret documents 
(Sec. 95.41);
    Defining procedures for challenging classification decisions that 
one believes to be in error (Sec. 95.37);
    Allowing for additional methods of transmitting classified 
information (Sec. 95.39);
    Changing 10 CFR Parts 50 and 54 to refer to current procedures in 
10 CFR Parts 25 and/or 95 for access to classified information 
(Secs. 50.37 and 54.17); and
    Imposing fewer limitations on a facility's authority to reproduce 
classified information when operationally necessary (Sec. 95.43).

II. Comments on the Proposed Rule

    The Commission received two letters commenting on the proposed 
rule, one from Georgia Power Company and one from the DOE. Copies of 
the letters are available for public inspection and copying for a fee 
at the Commission's Public Document Room, located at 2120 L Street, NW. 
(Lower Level), Washington, DC. Both comments support the rulemaking, 
but provide recommendations for clarifications and improvements. The 
Georgia Power Company recommends that the NRC:
    (1) Provide a procedure for the designation of the Cognizant 
Security Agency (CSA) for a facility;
    (2) Address the Commission's role in ensuring compliance with the 
rules of other CSA's;
    (3) Reconcile Restricted Data requirements in 10 CFR Parts 50 and 
54 of the Commission's regulations with the proposed changes to 10 CFR 
Parts 25 and 95; and,
    (4) Define when a facility clearance from the Commission is 
required. The DOE recommends that the NRC:
    (1) Use either ``access authorization'' throughout the rule or 
indicate that ``personnel security clearance'' is a synonym for 
``access authorization;''
    (2) Eliminate the use of the term ``Critical Secret Restricted 
Data'' and require all Secret Restricted Data to be protected at the 
level required by the February 1995 NISPOM Supplement;
    (3) Clarify the definition of ``access authorization'' in 
Sec. 25.5;
    (4) Clarify the requirements for review of the SF-86 in 
Sec. 25.17(e);
    (5) Clarify the scope of information to be protected in Sec. 95.3;
    (6) Change the term ``survey'' to ``review'' in Sec. 95.17(a)(2);
    (7) Clarify the level of access authorization required for senior 
management in Sec. 95.18;
    (8) Raise the level of protection for Secret Restricted Data in 
Sec. 95.25 to the requirements of the NISPOM Supplement;
    (9) Eliminate the requirements in Sec. 95.25(c)(2)(v) to change 
security container combinations once every 12 months which exceeds the 
NISPOM requirements;
    (10) Require that documents indicating ``multiple sources'' as the 
basis for classification have those sources identified on the record 
copy of the document; and,
    (11) Require that ``person'' not be referred to as able to possess 
a facility clearance in Sec. 95.57.

Comments From Georgia Power

    Comment: The commenter stated that ``* * * the proposed rule does 
not explain which of these agencies is the appropriate CSA in a given 
situation or for a given facility, or who makes that determination. 
Conceivably, more than one of the agencies could be the CSA.'' Georgia 
Power recommended that the final rule include a more precise definition 
of CSA or a procedure for designating a CSA in a given situation.
    Response: The definition of a CSA in 10 CFR Parts 25 and 95 has 
been changed to reflect that the CSA is the agency that exercises 
primary authority for the protection of the classified information at 
the facility and is the agency with which the facility interacts in 
these matters. The NRC agreement with the DoD and DOE implementing the 
National Industrial Security Program clearly indicates that one agency, 
the one with the greater security interest as determined between the 
agencies, would serve as the CSA and would be the agent of the other 
for matters relating to the protection of classified information. The 
facility would normally deal directly with the CSA on all issues 
related to the protection of classified information at that facility 
and the CSA would inform the other agency of issues related to its 
security interest.
    Comment: With respect to the issue of the Commission's role of 
ensuring compliance with the rules of other CSAs, the commenter's 
concern was ``* * * how the Commission will be notified regarding 
access authorizations requested from another agency. Does an NRC 
licensee have an obligation to notify the Commission if it applies to 
another CSA for an access authorization?''
    Response: Section 25.17 has been revised to require a facility, 
with a CSA other than NRC, to advise the NRC when it submits an 
individual for an access authorization for access to NRC classified 
information. The NRC does not need to be notified when the facility 
submits access authorization requests for access to classified 
information of the other agency. In keeping with the comment that the 
process should be simple, the change merely requires a letter of 
request for access to NRC classified information. The NRC must be 
involved when access to NRC classified information is requested since 
the NRC must make the need-to-know determination. The NRC will handle 
any necessary coordination between itself and the CSA.
    Comment: The commenter noted an apparent conflict between 
Secs. 50.37 and 54.17(g) and other Commission regulations.
    Response: The NRC has revised those paragraphs to resolve the 
conflict. The NRC has clarified that compliance with 10 CFR Parts 25 
and/or 95 satisfies the requirements of Secs. 50.37 and 54.17(g) as 
they relate to the protection of classified information.
    Comment: The commenter indicated that Sec. 95.15 was unclear on 
whether a facility clearance was required under certain circumstances 
for licensee activities at other facilities. Specifically, the 
commenter stated, ``As revised by the proposed rule, it is unclear 
whether 10 CFR 95.15 requires an NRC licensee to obtain a facility 
clearance from the Commission in order for employees of that licensee 
to `use' or `handle' classified information which is located at a 
completely different facility, including facilities subject to the 
oversight of another agency. For example, does 10 CFR 95.15 require a 
facility clearance from the Commission in order for employees of an NRC 
licensed facility to use or handle classified information which is 
maintained at a DOE facility? Conversely, does 10 CFR 95.15 require the 
NRC to clear the non-NRC licensed facility? Although it does not appear 
to be the Commission's intent to require a facility clearance in either 
situation, an affirmative statement in this regard would assist in the 
implementation of the rule.''
    Response: Section 95.15 has been modified to clarify that an NRC 
facility clearance is only required for the use or possession of NRC 
classified information at the facility. A licensee or other facility 
whose personnel are cleared by another agency for access to that 
agency's information at another facility does not require a facility 
clearance under Sec. 95.15, nor would NRC clear the other facility. 
However, it should be clear that if a licensee or other facility has a 
facility clearance for NRC classified information and they wish

[[Page 17685]]

another facility (e.g., one of their contractors) to have access to the 
NRC classified information at their (the contractor's) facility, that 
contractor would require an NRC facility clearance.

Comments From DOE

    Comment: DOE had two comments relating to ``access authorization:''
    (1) While ``access authorization'' was the commonly used term * * * 
``The introduction to the proposed rule references `personnel security 
clearance' and some of the language in the text contains variations, 
such as `personnel access authorization'. A common term should be used 
throughout, or the fact that a personnel security clearance is a 
synonym for access authorization established.''
    (2) The definition for ``access authorization'' is confusing, 
stating that it means an individual is eligible for ``security 
clearance for access to classified information.''
    Response: The term ``personnel security clearance'' in the 
Supplementary section of the final rule, which is an explanatory 
section rather than a portion of the rule, has been changed to ``access 
authorization.'' The other changes have not been adopted since this is 
a recommendation for an editorial change and, in each case where the 
terms are used the meaning is clear. The definition of ``access 
authorization'' has been used within the NRC industrial security 
program since the early 1980's, including at sites with joint DOE 
security interests, and within the NRC internal program since the 
inception of the agency, without confusion. The only change to the 
definition in this rule is to include certificate holders within its 
scope.
    Comment: The commenter noted that the proposed rule contains the 
term ``Critical Restricted Data.'' They state that this term has not 
been adopted by any agency and that the level of protection for Secret 
Restricted Data was not adequate. Specifically the commenter stated, 
``The draft regulation uses the term `Critical Secret Restricted Data.' 
This term has not be (sic) implemented by any agency. A review group 
was formed to review this issue and has decided not to use this term. 
Instead, information will be appropriately upgraded to Top Secret. It 
is strongly recommended that NRC not use the term ``Critical Secret 
Restricted Data'' in this regulation. Instead we suggest that all 
Secret Restricted Data continue to be protected at the NISPOM 
supplement level until the critical information has been upgraded to 
Top Secret.'' The commenter further states ``The storage requirements 
for Secret contained in this(sic) sections are not consistent with the 
storage requirements for Secret Restricted Data in the NISPOM 
supplement.''
    Response: Because of DOE's statutory responsibilities for the 
protection of Restricted Data, the potential economic impact on 
licensees and certificate holders and possible discrepancies with the 
requirements of the NISPOM, NRC is withdrawing the changes to 
Secs. 25.15 and 95.35 which deal with the level of clearance/type of 
background investigation required for access to Secret Restricted Data 
and will republish those changes separately for public comment. 
Additionally, although the term ``Critical Secret Restricted Data'' is 
defined in and the security requirements for it are specified in 
Chapter 9, ``Restricted Data,'' of the NISPOM Supplement, dated 
February 1995, the Supplement also indicates that a Joint DOE/DoD 
Nuclear Weapons Access Authorization Group is reviewing this issue and 
that there are ongoing efforts by the DOE and DoD to revise the 
requirements reflected in the Supplement. Because that group has 
decided not to use the term ``Critical Restricted Data,'' it has been 
removed from Sec. 95.31(b) and a description of the information it was 
intended to protect has been substituted. However, because the level of 
physical protection required for Secret Restricted Data in the proposed 
rule is essentially the same as the requirements of the current, long 
standing Part 95, and those requirements appear to meet the 
requirements of the NISPOM, it is difficult for the NRC to justify 
increasing its physical security requirements for all Secret Restricted 
Data, at increased financial and administrative burden to licensees and 
certificate holders at this time. However, if new policies for 
Restricted Data are approved and issued the NRC, at that time, will 
consider revising its regulations to reflect the new policies.
    Comment: The commenter questioned whether Sec. 25.17(e) requires a 
licensee/contractor to review Part 2 of the SF-86.
    Response: It is not the intent of this section that personnel at a 
licensee, certificate holder, or other facility review Part 2 of the 
SF-86, nor has it been NRC practice that this occur. The NRC's 
instructions for completing the SF-86 explicitly state that Part 2 of 
the SF-86 is to be placed in a sealed envelope by the individual 
completing the form and that the envelope is to be forwarded to the NRC 
unopened. Section 25.17(d)(1)(i) has been clarified to ensure that 
these requirements are clear.
    Comment: The commenter is concerned that Sec. 95.3 does not include 
Formerly Restricted Data.
    Response: While Formerly Restricted Data (FRD), information related 
primarily to the military use of atomic weapons, is rare in the NRC 
program, the NRC agrees that its regulations should clearly address all 
forms of classified information. Section 95.3 has been revised 
accordingly.
    Comment: The commenter is concerned that the term ``security 
survey'' is used in 10 CFR Part 95 instead of the NISPOM term 
``security review.''
    Response: The term ``survey'' in Secs. 95.17(a)(2) and 95.59 has 
been changed to ``review.''
    Comment: The commenter is concerned that Sec. 95.18 is not 
sufficiently clear about the level of access authorizations required 
for senior management. Specifically, the commenter states, ``Senior 
management cannot be cleared to the ``level of the facility'' by NRC, 
as NRC can only grant ``Q'' and ``L'' access authorizations, and 
facilities are classified as Secret, Top Secret, etc. Perhaps senior 
management could be cleared to a level commensurate with that of the 
facility clearance.''
    Response: Section 95.18 has been revised to reflect that senior 
management will be cleared to a level commensurate with that of the 
facility clearance.
    Comment: The commenter is concerned that the requirement to change 
security container combinations once every 12 months exceeds the 
requirements of the NISPOM.
    Response: Section 95,25(c)(2)(v) has been deleted, eliminating this 
requirement.
    Comment: The commenter is concerned that documents classified from 
multiple sources will not have an adequate record of what those sources 
were. Specifically, the commenter states, ``Suggest a sentence be added 
to indicate that on a document marked `multiple sources' that the 
multiple sources must be identified in the records copy of the 
document.''
    Response: The suggested revision is already contained in 
Sec. 95.37(c)(1)(iv).
    Comment: The commenter is concerned about the use of the term 
``person'' in association with a facility clearance and that the 
definition of facility clearance should be more detailed.
    Response: It is clear from the definitions and the context that any 
possessor of a facility clearance is obligated to immediately report 
certain types of information. The definition

[[Page 17686]]

``facility (security) clearance'' is a verbatim extract from the NISPOM 
and the definition of ``person'' used in Part 95 is similarly defined 
throughout 10 CFR and has been used for many years without confusion as 
to its meaning.

III. The Final Rule

    With the exception of the items addressed under ``Comments on the 
Proposed Rule'' and a slight change to the definition of ``Visit 
Authorization Letter'' in Sec. 25.5, the final rule is the same as the 
proposed rule. The specific changes from the proposed rule are--
    The proposed revisions to Secs. 25.15 and 95.35 have been 
withdrawn;
    The definition of ``CSA'' in 10 CFR Parts 25 and 95 has been 
revised to reflect that the CSA is the agency which exercises primary 
authority for the protection of the classified information at the 
facility and is the agency with which the facility interacts in these 
matters;
    The definition of ``Visit Authorization Letter'' in Sec. 25.5 has 
been revised to clarify that such a letter is only required for 
information specifically related to the license, certificate, or other 
NRC program at the facility;
    Section 25.17 has been amended to require a facility, with a CSA 
other than NRC, to advise the NRC when it submits an individual for an 
access authorization for access to NRC classified information, but not 
when the facility submits access authorization requests for access to 
the classified information of the other agency;
    Section 95.31(b) has been revised to delete the term ``Critical 
Secret Restricted Data'' and replace it with a generic description of 
the type of data it was intended to protect;
    Section 25.17(d)(1)(i) has been modified to clarify that facility 
security personnel are not to review Part 2 of the SF-86;
    Sections 50.37 and 54.17(g) have been amended to clarify that 
compliance with 10 CFR Parts 25 and/or 95 satisfies the requirements of 
10 CFR Parts 50 and 54;
    Section 95.3 has been modified to include Formerly Restricted Data 
within its scope;
    Section 95.15 has been modified to clarify that an NRC facility 
clearance is only required for the use or possession of NRC classified 
information at the facility;
    Sections 95.17(a)(2) and 95.59 have been revised to change 
``survey'' to ``review'';
    Section 95.18 has been revised to reflect that senior management 
will be cleared to a level commensurate with the facility clearance 
rather than ``to the level of'' the facility clearance; and,
    Section 95.25 has been revised to eliminate the requirement for 
changing security container combinations once every twelve months.

Small Business Regulatory Enforcement Fairness Act

    In accordance with the Small Business Regulatory Enforcement 
Fairness Act of 1996, the NRC has determined that this action is not a 
major rule and has verified this determination with the Office of 
Information and Regulatory Affairs of OMB.

Environmental Impact: Categorical Exclusion

    The NRC has determined that this final rule is the type of action 
described in categorical exclusion 10 CFR 51.22(c)(2). Therefore, 
neither an environmental impact statement nor an environmental 
assessment has been prepared for this final rule.

Paperwork Reduction Act Statement

    This final rule amends information collection requirements that are 
subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et 
seq.). These requirements were approved by the Office of Management and 
Budget, approval numbers 3150-0046, 3150-0047, and 3150-0050.
    The public reporting burden for this collection of information is 
estimated to average .5 hours per response, including the time for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
collection of information.
    Send comments on any aspect of this collection of information, 
including suggestions for reducing the burden, to the Information and 
Records Management Branch (T-6 F33), U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001, or by Internet electronic mail 
at [email protected]; and to the Desk Officer, Office of Information and 
Regulatory Affairs, NEOB-10202, (3150-0046, -0047 and -0050), Office of 
Management and Budget, Washington, DC 20503.

Public Protection Notification

    The NRC may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless it displays a currently 
valid OMB control number.

Regulatory Analysis

    The Commission has prepared a regulatory analysis for this final 
regulation. The analysis examines the costs and benefits of the 
alternatives considered by the Commission. Interested persons may 
examine a copy of the regulatory analysis at the NRC Public Document 
Room, 2120 L Street, NW. (Lower Level), Washington, DC. Single copies 
of the analysis may be obtained from Duane G. Kidd, Division of 
Security, Office of Administration, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, telephone (301) 415-7403.

Regulatory Flexibility Certification

    As required by the Regulatory Flexibility Act of 1980 (5 U.S.C. 
605(b)), the Commission certifies that this rule does not have a 
significant economic impact upon a substantial number of small 
entities. The NRC carefully considered the effect on small entities in 
developing this final rule on the protection of classified information 
and has determined that none of the facilities affected by this rule 
would qualify as a small entity under the NRC's size standards (10 CFR 
2.810).

Backfit Analysis

    The NRC has determined that the backfit rule, 10 CFR 50.109, 
applies to this rulemaking initiative because it falls within the 
criteria of 10 CFR Part 50.109(a)(1), but that a backfit analysis is 
not required because this rulemaking qualifies for exemption under 10 
CFR 50.109(a)(4)(iii) that reads ``That the regulatory action involves 
* * * redefining what level of protection to the * * * common defense 
and security should be regarded as adequate.''

List of Subjects

10 CFR Part 25

    Classified information, Criminal penalties, Investigations, 
Reporting and recordkeeping requirements, Security measures.

10 CFR Part 50

    Antitrust, Classified information, Criminal penalties, Fire 
protection, Intergovernmental relations, Nuclear power plants and 
reactors, Radiation protection, Reactor siting criteria, Reporting and 
recordkeeping requirements.

10 CFR Part 54

    Administrative practice and procedure, Aging management review, 
Backfitting, Classified information, Criminal penalties, Nuclear power 
plants and reactors, Reporting and recordkeeping requirements.

[[Page 17687]]

10 CFR Part 95

    Classified information, Criminal penalties, Reporting and 
recordkeeping requirements, Security measures.

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended, the Energy Reorganization 
Act of 1974, as amended, and 5 U.S.C. 552 and 553, the NRC is adopting 
the following amendments to 10 CFR Parts 25, 50, 54 and 95.

PART 25--ACCESS AUTHORIZATION FOR LICENSEE PERSONNEL

    1. The authority citation for Part 25 is revised to read as 
follows:

    Authority: Secs. 145, 161, 68 Stat. 942, 948, as amended (42 
U.S.C. 2165, 2201); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 
5841); E.O. 10865, as amended, 3 CFR 1959--1963 Comp., p. 398 (50 
U.S.C. 401, note); E.O. 12829, 3 CFR, 1993 Comp., p. 570; E.O. 
12958, 3 CFR, 1995 Comp., p. 333; E.O. 12968, 3 CFR, 1995 Comp., p. 
396.

    Appendix A also issued under 96 Stat. 1051 (31 U.S.C. 9701).
    2. Section 25.1 is revised to read as follows:


Sec. 25.1  Purpose.

    The regulations in this part establish procedures for granting, 
reinstating, extending, transferring, and terminating access 
authorizations of licensee personnel, licensee contractors or agents, 
and other persons (e.g., individuals involved in adjudicatory 
procedures as set forth in 10 CFR Part 2, subpart I) who may require 
access to classified information.
    3. Section 25.3 is revised to read as follows:


Sec. 25.3  Scope.

    The regulations in this part apply to licensees and others who may 
require access to classified information related to a license or an 
application for a license.
    4. Section 25.5 is amended by revising the definitions Access 
authorization and Need-to-know and by adding the definitions of 
Certificate holder, Classified information, Classified National 
Security Information, Cognizant Security Agency, and Visit 
authorization letters in alphabetical order to read as follows:


Sec. 25.5  Definitions.

    Access authorization means an administrative determination that an 
individual (including a consultant) who is employed by or an applicant 
for employment with the NRC, NRC contractors, agents, licensees and 
certificate holders, or other person designated by the Executive 
Director for Operations, is eligible for a security clearance for 
access to classified information.
* * * * *
    Certificate holder means a facility operating under the provisions 
of Parts 71 or 76 of this chapter.
    Classified information means either classified National Security 
Information, Restricted Data, or Formerly Restricted Data or any one of 
them. It is the generic term for information requiring protection in 
the interest of National Security whether classified under an Executive 
Order or the Atomic Energy Act.
    Classified National Security Information means information that has 
been determined pursuant to E.O. 12958 or any predecessor order to 
require protection against unauthorized disclosure and that is so 
designated.
    Cognizant Security Agency (CSA) means agencies of the Executive 
Branch that have been authorized by E.O. 12829 to establish an 
industrial security program for the purpose of safeguarding classified 
information under the jurisdiction of those agencies when disclosed or 
released to U.S. industry. These agencies are the Department of 
Defense, the Department of Energy, the Central Intelligence Agency, and 
the Nuclear Regulatory Commission. A facility has a single CSA which 
exercises primary authority for the protection of classified 
information at the facility. The CSA for the facility provides security 
representation for other government agencies with security interests at 
the facility. The Secretary of Defense has been designated as Executive 
Agent for the National Industrial Security Program.
* * * * *
    Need-to-know means a determination made by an authorized holder of 
classified information that a prospective recipient requires access to 
specific classified information to perform or assist in a lawful and 
authorized governmental function under the cognizance of the 
Commission.
* * * * *
    Visit authorization letters (VAL) means a letter, generated by a 
licensee, certificate holder or other organization under the 
requirements of 10 CFR Parts 25 and/or 95, verifying the need-to-know 
and access authorization of an individual from that organization who 
needs to visit another authorized facility for the purpose of 
exchanging or acquiring classified information related to the license.
    5. In Sec. 25.8, paragraphs (a) and (b) are revised to read as 
follows:


Sec. 25.8  Information collection requirements: OMB approval.

    (a) The Nuclear Regulatory Commission has submitted the information 
collection requirements contained in this part to the Office of 
Management and Budget (OMB) for approval as required by the Paperwork 
Reduction Act (44 U.S.C. 3501 et seq.). The NRC may not conduct or 
sponsor and a person is not required to respond to a collection of 
information unless it displays a currently valid OMB control number. 
OMB has approved the information collection requirements contained in 
this part under control number 3150-0046.
    (b) The approved information collection requirements contained in 
this part appear in Secs. 25.11, 25.17, 25.21, 25.23, 25.25, 25.27, 
25.29, 25.31, 25.33, and 25.35.
* * * * *
    6. In Sec. 25.13, paragraph (a) is revised to read as follows:


Sec. 25.13  Maintenance of records.

    (a) Each licensee or organization employing individuals approved 
for personnel security access authorization under this part, shall 
maintain records as prescribed within the part. These records are 
subject to review and inspection by CSA representatives during security 
reviews.
* * * * *
    7. Section 25.17 is revised to read as follows:


Sec. 25.17  Approval for processing applicants for access 
authorization.

    (a) Access authorizations must be requested for licensee employees 
or other persons (e.g., 10 CFR Part 2, subpart I) who need access to 
classified information in connection with activities under 10 CFR parts 
50, 52, 54, 70, 72, or 76.
    (b) The request must be submitted to the facility CSA. If the NRC 
is the CSA, the procedures in Sec. 25.17 (c) and (d) will be followed. 
If the NRC is not the CSA, the request will be submitted to the CSA in 
accordance with procedures established by the CSA. The NRC will be 
notified of the request by a letter that includes the name, Social 
Security number and level of access authorization.
    (c) The request must include a completed personnel security packet 
(see Sec. 25.17(d)) and request form (NRC Form 237) signed by a 
licensee, licensee contractor official, or other authorized person.
    (d)(1) Each personnel security packet submitted must include the 
following completed forms:

[[Page 17688]]

    (i) Questionnaire for National Security Positions (SF-86, Parts 1 
and 2) (Part 2 is to be completed by the applicant and placed in a 
sealed envelope which is to be forwarded to NRC unopened. No licensee, 
licensee contractor official, or other person at a facility is 
permitted to review Part 2 information);
    (ii) Two standard fingerprint cards (FD-258);
    (iii) Security Acknowledgment (NRC Form 176); and
    (iv) Other related forms where specified in accompanying 
instructions (NRC Form 254).
    (2) Only a Security Acknowledgment (NRC Form 176) need be completed 
by any person possessing an active access authorization, or who is 
being processed for an access authorization, by another Federal agency. 
The active or pending access authorization must be at an equivalent 
level to that required by the NRC and be based on an adequate 
investigation not more than five years old.
    (e) To avoid delays in processing requests for access 
authorizations, each security packet should be reviewed for 
completeness and correctness (including legibility of response on the 
forms) before submittal.
    (f) Applications for access authorization or access authorization 
renewal processing that are submitted to the NRC for processing must be 
accompanied by a check or money order, payable to the United States 
Nuclear Regulatory Commission, representing the current cost for the 
processing of each ``Q'' and ``L'' access authorization, or renewal 
request. Access authorization and access authorization renewal fees 
will be published each time the Office of Personnel Management notifies 
the NRC of a change in the rates it charges the NRC for the conduct of 
investigations. Any changed access authorization or access 
authorization renewal fees will be applicable to each access 
authorization or access authorization renewal request received upon or 
after the date of publication. Applications from individuals having 
current Federal access authorizations may be processed more 
expeditiously and at less cost, since the Commission may accept the 
certification of access authorization and investigative data from other 
Federal Government agencies that grant personnel access authorizations.
    8. Section 25.19 is revised to read as follows:


Sec. 25.19  Processing applications.

    Each application for access authorization or access authorization 
renewal must be submitted to the CSA. If the NRC is the CSA, the 
application and its accompanying fee must be submitted to the NRC 
Division of Security. If necessary, the NRC Division of Security may 
obtain approval from the appropriate Commission office exercising 
licensing or regulatory authority before processing the access 
authorization or access authorization renewal request. If the applicant 
is disapproved for processing, the NRC Division of Security shall 
notify the submitter in writing and return the original application 
(security packet) and its accompanying fee.
    9. Section 25.21 is revised to read as follows:


Sec. 25.21  Determination of initial and continued eligibility for 
access authorization.

    (a) Following receipt by the CSA of the reports of the personnel 
security investigations, the record will be reviewed to determine that 
granting an access authorization or renewal of access authorization 
will not endanger the common defense and security and is clearly 
consistent with the national interest. If this determination is made, 
access authorization will be granted or renewed. If the NRC is the CSA, 
questions as to initial or continued eligibility will be determined in 
accordance with Part 10 of Chapter I. If another agency is the CSA, 
that agency will, under the requirements of the NISPOM, have 
established procedures at the facility to resolve questions as to 
initial or continued eligibility for access authorization. These 
questions will be determined in accordance with established CSA 
procedures already in effect for the facility.
    (b) The CSA must be promptly notified of developments that bear on 
continued eligibility for access authorization throughout the period 
for which the authorization is active (e.g., persons who marry 
subsequent to the completion of a personnel security packet must report 
this change by submitting a completed NRC Form 354, ``Data Report on 
Spouse'' or equivalent CSA form).
    (c)(1) Except as provided in paragraph (c)(2) of this section, NRC 
``Q'' and ``L'' access authorizations must be renewed every five years 
from the date of issuance. An application for renewal must be submitted 
at least 120 days before the expiration of the five year period, and 
must include:
    (i) A statement by the licensee or other person that the individual 
continues to require access to classified National Security Information 
or Restricted Data; and
    (ii) A personnel security packet as described in Sec. 25.17(d).
    (2) Renewal applications and the required paperwork are not 
required for individuals who have a current and active access 
authorization from another Federal agency and who are subject to a 
reinvestigation program by that agency that is determined by the NRC to 
meet the NRC's requirements. (The DOE Reinvestigation Program has been 
determined to meet the NRC's requirements). For these individuals, the 
submission of the SF-86 by the licensee or other person to the other 
government agency pursuant to their reinvestigation requirements will 
satisfy the NRC renewal submission and paperwork requirements, even if 
less than five years has passed since the date of issuance or renewal 
of the NRC ``Q'' or ``L'' access authorization. Any NRC access 
authorization continued in response to the provisions of this paragraph 
will, thereafter, not be due for renewal until the date set by the 
other government agency for the next reinvestigation of the individual 
pursuant to the other agency's reinvestigation program. However, the 
period of time for the initial and each subsequent NRC ``Q'' or NRC 
``L'' renewal application to the NRC may not exceed seven years. Any 
individual who is subject to the reinvestigation program requirements 
of another Federal agency but, for administrative or other reasons, 
does not submit reinvestigation forms to that agency within seven years 
of the previous submission, shall submit a renewal application to the 
NRC using the forms prescribed in Sec. 25.17(d) before the expiration 
of the seven-year period.
    (3) If the NRC is not the CSA, reinvestigation program procedures 
and requirements will be set by the CSA.
    10. Section 25.23 is revised to read as follows:


Sec. 25.23  Notification of grant of access authorization.

    The determination to grant or renew access authorization will be 
furnished in writing to the licensee or organization that initiated the 
request. Upon receipt of the notification of original grant of access 
authorization, the licensee or organization shall obtain, as a 
condition for grant of access authorization and access to classified 
information, an executed ``Classified Information Nondisclosure 
Agreement'' (SF-312) from the affected individual. The SF-312 is an 
agreement between the United States and an individual who is cleared 
for access to classified information. An employee issued an initial 
access authorization shall execute a SF-312 before being granted access 
to classified

[[Page 17689]]

information. The licensee or other organization shall forward the 
executed SF-312 to the CSA for retention. If the employee refuses to 
execute the SF-312, the licensee or other organization shall deny the 
employee access to classified information and submit a report to the 
CSA. The SF-312 must be signed and dated by the employee and witnessed. 
The employee's and witness' signatures must bear the same date. The 
individual shall also be given a security orientation briefing in 
accordance with Sec. 95.33 of this chapter. Records of access 
authorization grant and renewal notification must be maintained by the 
licensee or other organization for three years after the access 
authorization has been terminated by the CSA. This information may also 
be furnished to other representatives of the Commission, to licensees, 
contractors, or other Federal agencies. Notifications of access 
authorization will not be given in writing to the affected individual 
except:
    (a) In those cases in which the determination was made as a result 
of a Personnel Security Hearing or by Personnel Security Review 
Examiners; or
    (b) When the individual also is the official designated by the 
licensee or other organization to whom written NRC notifications are 
forwarded.
    11. Section 25.25 is revised to read as follows:


Sec. 25.25  Cancellation of requests for access authorization.

    When a request for an individual's access authorization or renewal 
of access authorization is withdrawn or canceled, the requestor shall 
notify the CSA immediately by telephone so that the full field 
investigation, National Agency Check with Credit Investigation, or 
other personnel security action may be discontinued. The requestor 
shall identify the full name and date of birth of the individual, the 
date of request, and the type of access authorization or access 
authorization renewal requested. The requestor shall confirm each 
telephone notification promptly in writing.
    12. Section 25.27 is revised to read as follows:


Sec. 25.27  Reopening of cases in which requests for access 
authorizations are canceled.

    (a) In conjunction with a new request for access authorization (NRC 
Form 237 or CSA equivalent) for individuals whose cases were previously 
canceled, new fingerprint cards (FD-257) in duplicate and a new 
Security Acknowledgment (NRC Form 176), or CSA equivalents, must be 
furnished to the CSA along with the request.
    (b) Additionally, if 90 days or more have elapsed since the date of 
the last Questionnaire for Sensitive Positions (SF-86), or CSA 
equivalent, the individual must complete a personnel security packet 
(see Sec. 25.17(d)). The CSA, based on investigative or other needs, 
may require a complete personnel security packet in other cases as 
well. A fee, equal to the amount paid for an initial request, will be 
charged only if a new or updating investigation by the NRC is required.
    13. Section 25.29 is revised to read as follows:


Sec. 25.29  Reinstatement of access authorization.

    (a) An access authorization can be reinstated provided that:
    (1) No more than 24 months has lapsed since the date of termination 
of the clearance;
    (2) There has been no break in employment with the employer since 
the date of termination of the clearance;
    (3) There is no known adverse information;
    (4) The most recent investigation must not exceed 5 years (Top 
Secret, Q) or 10 years (Secret, L); and
    (5) The most recent investigation must meet or exceed the scope of 
the investigation required for the level of access authorization that 
is to be reinstated or granted.
    (b) An access authorization can be reinstated at the same, or 
lower, level by submission of a CSA-designated form to the CSA. The 
employee may not have access to classified information until receipt of 
written confirmation of reinstatement and an up-to-date personnel 
security packet will be furnished with the request for reinstatement of 
an access authorization. A new Security Acknowledgment will be obtained 
in all cases. Where personnel security packets are not required, a 
request for reinstatement must state the level of access authorization 
to be reinstated and the full name and date of birth of the individual 
to establish positive identification. A fee, equal to the amount paid 
for an initial request, will be charged only if a new or updating 
investigation by the NRC is required.
    14. In Sec. 25.31, paragraphs (a) and (c) are revised to read as 
follows:


Sec. 25.31  Extensions and transfers of access authorizations.

    (a) The NRC Division of Security may, on request, extend the 
authorization of an individual who possesses an access authorization in 
connection with a particular employer or activity, to permit access to 
classified information in connection with an assignment with another 
employer or activity.
* * * * *
    (c) Requests for extension or transfer of access authorization must 
state the full name of the person, his date of birth and level of 
access authorization. The Director, Division of Security, may require a 
new personnel security packet (see Sec. 25.17(c)) to be completed by 
the applicant. A fee, equal to the amount paid for an initial request, 
will be charged only if a new or updating investigation by the NRC is 
required.
* * * * *
    15. Section 25.33 is revised to read as follows:


Sec. 25.33  Termination of access authorizations.

    (a) Access authorizations will be terminated when:
    (1) Access authorization is no longer required;
    (2) An individual is separated from the employment or the activity 
for which he obtained an access authorization for a period of 90 days 
or more; or
    (3) An individual, pursuant to 10 CFR part 10 or other CSA approved 
adjudicatory standards, is no longer eligible for access authorization.
    (b) A representative of the licensee or other organization that 
employs the individual whose access authorization will be terminated 
shall immediately notify the CSA when the circumstances noted in 
paragraph (a)(1) or (a)(2) of this section exist; inform the individual 
that his access authorization is being terminated, and the reason; and 
that he will be considered for reinstatement of access authorization if 
he resumes work requiring it.
    (c) When an access authorization is to be terminated, a 
representative of the licensee or other organization shall conduct a 
security termination briefing of the individual involved, explain the 
Security Termination Statement (NRC Form 136 or CSA approved form) and 
have the individual complete the form. The representative shall 
promptly forward the original copy of the completed Security 
Termination Statement to CSA.
    16. Section 25.35 is revised to read as follows:


Sec. 25.35  Classified visits.

    (a) The number of classified visits must be held to a minimum. The 
licensee, certificate holder, or other facility shall determine that 
the visit is necessary and that the purpose of the visit cannot be 
achieved without access

[[Page 17690]]

to, or disclosure of, classified information. All classified visits 
require advance notification to, and approval of, the organization to 
be visited. In urgent cases, visit information may be furnished by 
telephone and confirmed in writing.
    (b) Representatives of the Federal Government, when acting in their 
official capacities as inspectors, investigators, or auditors, may 
visit a licensee, certificate holder or other's facility without 
furnishing advanced notification, provided these representatives 
present appropriate government credentials upon arrival. Normally, 
however, Federal representatives will provide advance notification in 
the form of an NRC Form 277, ``Request for Visit or Access Approval,'' 
with the ``need-to-know'' certified by the appropriate NRC office 
exercising licensing or regulatory authority and verification of NRC 
access authorization by the Division of Security.
    (c) The licensee, certificate holder, or others shall include the 
following information in all Visit Authorization Letters (VAL) which 
they prepare.
    (1) Visitor's name, address, and telephone number and certification 
of the level of the facility security clearance;
    (2) Name, date and place of birth, and citizenship of the 
individual intending to visit;
    (3) Certification of the proposed visitor's personnel clearance and 
any special access authorizations required for the visit;
    (4) Name of person(s) to be visited;
    (5) Purpose and sufficient justification for the visit to allow for 
a determination of the necessity of the visit; and
    (6) Date or period during which the VAL is to be valid.
    (d) Classified visits may be arranged for a 12 month period. The 
requesting facility shall notify all places honoring these visit 
arrangements of any change in the individual's status that will cause 
the visit request to be canceled before its normal termination date.
    (e) The responsibility for determining need-to-know in connection 
with a classified visit rests with the individual who will disclose 
classified information during the visit. The licensee, certificate 
holder or other facility shall establish procedures to ensure positive 
identification of visitors before the disclosure of any classified 
information.

PART 50--DOMESTIC LICENSING OF PRODUCTION AND UTILIZATION 
FACILITIES

    17. The authority citation for Part 50 is revised to read as 
follows:

    Authority: Secs. 102, 103, 104, 105, 161, 182, 183, 186, 189, 68 
Stat. 936, 937, 938, 948, 953, 954, 955, 956, as amended, sec. 234, 
83 Stat. 1244, as amended (42 U.S.C. 2132, 2133, 2134, 2135, 2201, 
2232, 2233, 2236, 2239, 2282); secs. 201, as amended, 202, 206, 88 
Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846), 
E.O. 12829, 3 CFR, 1993 Comp., p. 570; E.O. 12958, as amended, 3 
CFR, 1995 Comp., p. 333; E.O. 12968, 3 CFR, 1995 Comp., p. 391.

    Section 50.7 also issued under Pub. L. 95-601, sec. 10, 92 Stat. 
2951 (42 U.S.C. 5851). Section 50.10 also issued under secs. 101, 
185, 68 Stat. 955 as amended (42 U.S.C. 2131, 2235), sec. 102, Pub. 
L. 91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.13, 50.54(dd), 
and 50.103 also issued under sec. 108, 68 Stat. 939, as amended (42 
U.S.C. 2138). Sections 50.23, 50.35, 50.55, and 50.56 also issued 
under sec. 185, 68 Stat. 955 (42 U.S.C. 2235). Sections 50.33a, 
50.55a and Appendix Q also issued under sec. 102, Pub. L. 91-190, 83 
Stat. 853 (42 U.S.C. 4332). Sections 50.34 and 50.54 also issued 
under sec. 204, 88 Stat. 1245 (42 U.S.C. 5844). Sections 50.58, 
50.91, and 50.92 also issued under Pub. L. 97-415, 96 Stat. 2073 (42 
U.S.C. 2239). Section 50.78 also issued under sec. 122, 68 Stat. 939 
(42 U.S.C. 2152). Sections 50.80--50.81 also issued under sec. 184, 
68 Stat. 954, as amended (42 U.S.C. 2234). Appendix F also issued 
under sec. 187, 68 Stat. 955 (42 U.S.C 2237).
    18. Section 50.37 is revised to read as follows:


Sec. 50.37  Agreement limiting access to Classified Information.

    As part of its application and in any event before the receipt of 
Restricted Data or classified National Security Information or the 
issuance of a license or construction permit, the applicant shall agree 
in writing that it will not permit any individual to have access to or 
any facility to possess Restricted Data or classified National Security 
Information until the individual and/or facility has been approved for 
such access under the provisions of 10 CFR Parts 25 and/or 95. The 
agreement of the applicant in this regard shall be deemed part of the 
license or construction permit, whether so stated therein or not.

PART 54--REQUIREMENTS FOR RENEWAL OF OPERATING LICENSES FOR NUCLEAR 
POWER PLANTS

    19. The authority citation for Part 54 is revised to read as 
follows:

    Authority: Secs. 102, 103, 104, 161, 181, 182, 183, 186, 189, 68 
Stat. 936, 937, 938, 948, 953, 954, 955, as amended, sec. 234, 83 
Stat. 1244, as amended (42 U.S.C. 2132, 2133, 2134, 2135, 2201, 
2232, 2233, 2236, 2239, 2282); secs 201, 202, 206, 88 Stat. 1242, 
1244, as amended (42 U.S.C. 5841, 5842), E.O. 12829, 3 CFR, 1993 
Comp., p. 570; E.O. 12958, as amended, 3 CFR, 1995 Comp., p. 333; 
E.O. 12968, 3 CFR, 1995 Comp., p. 391.

    20. In Sec. 54.17, paragraph (g) is revised to read as follows:


Sec. 54.17  Filing of application.

* * * * *
    (g) As part of its application, and in any event before the receipt 
of Restricted Data or classified National Security Information or the 
issuance of a renewed license, the applicant shall agree in writing 
that it will not permit any individual to have access to or any 
facility to possess Restricted Data or classified National Security 
Information until the individual and/or facility has been approved for 
such access under the provisions of 10 CFR Parts 25 and/or 95. The 
agreement of the applicant in this regard shall be deemed part of the 
renewed license, whether so stated therein or not.

PART 95--SECURITY FACILITY APPROVAL AND SAFEGUARDING OF NATIONAL 
SECURITY INFORMATION AND RESTRICTED DATA

    21. The authority citation for Part 95 is revised to read as 
follows:

    Authority: Secs. 145, 161, 193, 68 Stat. 942, 948, as amended 
(42 U.S.C. 2165, 2201); sec. 201, 88 Stat. 1242, as amended (42 
U.S.C. 5841); E.O. 10865, as amended, 3 CFR 1959-1963 COMP., p. 398 
(50 U.S.C. 401, note); E.O. 12829, 3 CFR, 1993 Comp., p. 570; E.O. 
12958, as amended, 3 CFR, 1995 Comp., p. 333; E.O. 12968, 3 CFR, 
1995 Comp., p. 391.

    22. Section 95.1 is revised to read as follows:


Sec. 95.1  Purpose.

    The regulations in this part establish procedures for obtaining 
security facility approval and for safeguarding Secret and Confidential 
National Security Information and Restricted Data received or developed 
in conjunction with activities licensed, certified or regulated by the 
Commission. This part does not apply to Top Secret information because 
Top Secret information may not be forwarded to licensees, certificate 
holders, or others within the scope of an NRC license or certificate.
    23. Section 95.3 is revised to read as follows:


Sec. 95.3  Scope.

    The regulations in this part apply to licensees, certificate 
holders and others regulated by the Commission who may require access 
to classified National Security Information and/or Restricted

[[Page 17691]]

Data and/or Formerly Restricted Data (FRD) that is used, processed, 
stored, reproduced, transmitted, transported, or handled in connection 
with a license or certificate or an application for a license or 
certificate.
    24. In Sec. 95.5, the definitions for Authorized classifier, 
National Security Information, NRC access authorization, Security 
facility approval, and Security survey are removed and the definitions 
Classified mail address, Infraction, and Need-to-know are revised and 
the definitions Access authorization, Classified National Security 
Information, Classified shipping address, Closed area, Cognizant 
Security Agency, Facility (Security) clearance, Foreign ownership 
control or influence, Restricted area, Security reviews, Supplemental 
Protection and Violation are added in alphabetical order to read as 
follows:


Sec. 95.5  Definitions.

    Access authorization means an administrative determination that an 
individual (including a consultant) who is employed by or an applicant 
for employment with the NRC, NRC contractors, agents, licensees and 
certificate holders, or other person designated by the Executive 
Director for Operations, is eligible for a security clearance for 
access to classified information.
* * * * *
    Classified mail address means a mail address established for each 
facility approved by the NRC, to which all classified information for 
the facility is to be sent.
* * * * *
    Classified National Security Information means information that has 
been determined pursuant to E.O. 12958 or any predecessor order to 
require protection against unauthorized disclosure and that is so 
designated.
    Classified shipping address means an address established for a 
facility, approved by the NRC to which classified material that cannot 
be transmitted as normal mail is to be sent.
    Closed area means an area that meets the requirements of the CSA, 
for the purpose of safeguarding classified material that, because of 
its size, nature, or operational necessity, cannot be adequately 
protected by the normal safeguards or stored during nonworking hours in 
approved containers.
    Cognizant Security Agency (CSA) means agencies of the Executive 
Branch that have been authorized by E.O. 12829 to establish an 
industrial security program for the purpose of safeguarding classified 
information under the jurisdiction of those agencies when disclosed or 
released to U.S. industry. These agencies are the Department of 
Defense, the Department of Energy, the Central Intelligence Agency, and 
the Nuclear Regulatory Commission. A facility has a single CSA which 
exercises primary authority for the protection of classified 
information at the facility. The CSA for the facility provides security 
representation for other government agencies with security interests at 
the facility. The Secretary of Defense has been designated as Executive 
Agent for the National Industrial Security Program.
* * * * *
    Facility (Security) Clearance (FCL) means an administrative 
determination that, from a security viewpoint, a facility is eligible 
for access to classified information of a certain category (and all 
lower categories).
    Foreign ownership, control, or influence (FOCI) means a foreign 
interest has the power, direct or indirect, whether or not exercised, 
and whether or not exercisable through the ownership of a U.S. 
company's securities, by contractual arrangements or other means, to 
direct or decide matters affecting the management or operations of that 
company in a manner which may result in unauthorized access to 
classified information or may affect adversely the performance of 
classified contracts.
    Infraction means any knowing, willful, or negligent action contrary 
to the requirements of E.O. 12958, or its implementing directives, that 
does not comprise a ``violation,'' as defined in this section.
* * * * *
    Need-to-know means a determination made by an authorized holder of 
classified information that a prospective recipient requires access to 
specific classified information in order to perform or assist in a 
lawful and authorized governmental function under the cognizance of the 
Commission.
* * * * *
    Restricted area means a controlled access area established to 
safeguard classified material, that because of its size or nature, 
cannot be adequately protected during working hours by the usual 
safeguards, but that is capable of being stored during non-working 
hours in an approved repository or secured by other methods approved by 
the CSA.
* * * * *
    Security reviews means aperiodic security reviews of cleared 
facilities conducted to ensure that safeguards employed by licensees 
and others are adequate for the protection of classified information.
    Supplemental protection means additional security procedures such 
as intrusion detection systems, security guards, and access control 
systems.
    Violation means any knowing, willful, or negligent action that 
could reasonably be expected to result in an unauthorized disclosure of 
classified information or any knowing, willful, or negligent action to 
classify or continue the classification of information contrary to the 
requirements of E.O. 12958 or its implementing directives.
    25. Section 95.8 is revised to read as follows:


Sec. 95.8  Information collection requirements: OMB approval.

    (a) The Nuclear Regulatory Commission has submitted the information 
collection requirements contained in this part to the Office of 
Management and Budget (OMB) for approval as required by the Paperwork 
Reduction Act (44 U.S.C. 3501 et seq.). The NRC may not conduct or 
sponsor and a person is not required to respond to a collection of 
information unless it displays a currently valid OMB control number. 
OMB has approved the information collection requirements contained in 
this part under control number 3150-0047.
    (b) The approved information collection requirements contained in 
this part appear in Secs. 95.11, 95.15, 95.18, 95.19, 95.21, 95.25, 
95.29, 95.33, 95.36, 95.37, 95.39, 95.41, 95.43, 95.45, 95.47, 95.53 
and 95.57.
    26. In Sec. 95.13, paragraph (a) is revised to read as follows:


Sec. 95.13  Maintenance of records.

    (a) Each licensee, certificate holder or other person granted 
facility clearance under this part shall maintain records as prescribed 
within the part. These records are subject to review and inspection by 
CSA representatives during security reviews.
* * * * *
    27. In Sec. 95.15, the section heading and paragraphs (a) and (b) 
are revised to read as follows:


Sec. 95.15  Approval for processing licensees and others for facility 
clearance.

    (a) A licensee, certificate holder or other person who has a need 
to use, process, store, reproduce, transmit, transport, or handle NRC 
classified information at any location in connection with Commission 
related activities shall promptly request an NRC facility clearance. 
This specifically includes situations where a licensee, certificate 
holder or other person needs

[[Page 17692]]

a contractor or consultant to have access to NRC classified 
information. However, it is not necessary for a licensee, certificate 
holder or other person to request an NRC facility clearance for access 
to another agency's classified information at that agency's facilities 
or to store that agency's classified information at their facility, 
provided no NRC classified information is involved and they meet the 
security requirements of the other agency. If NRC classified 
information is involved the requirements of Sec. 95.17 apply.
    (b) The request must include the name of the facility, the location 
of the facility and an identification of any facility clearance issued 
by another government agency. If there is no existing facility 
clearance, the request must include a security Standard Practice 
Procedures Plan that outlines the facility's proposed security 
procedures and controls for the protection of classified information, a 
floor plan of the area in which the matter is to be used, processed, 
stored, reproduced, transmitted, transported or handled; and Foreign 
Ownership, Control or Influence information.
* * * * *
    28. Section 95.17 is revised to read as follows:


Sec. 95.17  Processing facility clearance.

    (a) Following the receipt of an acceptable request for facility 
clearance, the NRC will either accept an existing facility clearance 
granted by a current CSA and authorize possession of license or 
certificate related classified information or process the facility for 
a facility clearance. Processing will include--
    (1) A determination based on review and approval of a Standard 
Practice Procedure Plan that granting of the Facility Clearance would 
not be inconsistent with the national interest, including a finding 
that the facility is not under foreign ownership, control, or influence 
to such a degree that a determination could not be made;
    (2) An acceptable security review conducted by the NRC;
    (3) Submitting key management personnel for personnel clearances 
(PCLs); and
    (4) Appointing a U.S. citizen employee as the facility security 
officer.
    (b) An interim Facility Clearance may be granted by the CSA on a 
temporary basis pending completion of the full investigative 
requirements.


Secs. 95.18 and 95.19  [Redesignated]

    29. Secs. 95.18 and 95.19 are redesignated as Secs. 95.19 and 
95.20.
    30. A new Sec. 95.18 is added to read as follows:


Sec. 95.18  Key personnel.

    The senior management official and the Facility Security Officer 
must always be cleared to a level commensurate with the Facility 
Clearance. Other key management officials, as determined by the CSA, 
must be granted an access authorization or be excluded from classified 
access. When formal exclusion action is required, the organization's 
board of directors or similar executive body shall affirm the 
following, as appropriate.
    (a) Officers, directors, partners, regents, or trustees (designated 
by name) that are excluded may not require, may not have, and can be 
effectively excluded from access to all classified information 
disclosed to the organization. These individuals also may not occupy 
positions that would enable them to adversely affect the organization's 
policies or practices in the performance of activities involving 
classified information. This action will be made a matter of record by 
the organization's executive body. A copy of the resolution must be 
furnished to the CSA.
    (b) Officers, directors, partners, regents, or trustees (designated 
by name) that are excluded may not require, may not have, and can be 
effectively denied access to higher-level classified information 
(specify which higher level(s)). These individuals may not occupy 
positions that would enable them to adversely affect the organization's 
policies or practices in the protection of classified information. This 
action will be made a matter of record by the organization's executive 
body. A copy of the resolution must be furnished to the CSA.
    31. In the newly redesignated Sec. 95.19, the introductory text of 
paragraphs (a) and (b) are revised to read as follows:


Sec. 95.19  Changes to security practices and procedures.

    (a) Except as specified in paragraph (b) of this section, each 
licensee, certificate holder or other person shall obtain prior CSA 
approval for any proposed change to the name, location, security 
procedures and controls, or floor plan of the approved facility. A 
written description of the proposed change must be furnished to the CSA 
with copies to the Director, Division of Security, Office of 
Administration, NRC, Washington, DC 20555-0001 (if NRC is not the CSA), 
and the NRC Regional Administrator of the cognizant Regional Office 
listed in appendix A of part 73. The CSA shall promptly respond in 
writing to all such proposals. Some examples of substantive changes 
requiring prior CSA approval include--
* * * * *
    (b) A licensee or other person may effect a minor, non-substantive 
change to an approved Standard Practice Procedures Plan for the 
safeguarding of classified information without receiving prior CSA 
approval, provided prompt notification of such minor change is 
furnished to the addressees noted in paragraph (a) of this section, and 
the change does not decrease the effectiveness of the Standard Practice 
Procedures Plan. Some examples of minor, non-substantive changes to the 
Standard Practice Procedures Plan include--
* * * * *
    32. The newly redesignated Sec. 95.20 is revised to read as 
follows:


Sec. 95.20  Grant, denial or termination of facility clearance.

    The Division of Security shall provide notification in writing (or 
orally with written confirmation) to the licensee or other organization 
of the Commission's grant, acceptance of another agency's Facility 
Clearance, denial, or termination of facility clearance. This 
information must also be furnished to representatives of the NRC, NRC 
licensees, NRC certificate holders, NRC contractors, or other Federal 
agencies having a need to transmit classified information to the 
licensee or other person.
    33. Section 95.21 is revised to read as follows:


Sec. 95.21  Withdrawal of requests for facility clearance.

    When a request for facility clearance is to be withdrawn or 
canceled, the requester shall notify the NRC Division of Security 
immediately by telephone so that processing for this approval may be 
terminated. The notification must identify the full name of the 
individual requesting discontinuance, his position with the facility, 
and the full identification of the facility. The requestor shall 
confirm the telephone notification promptly in writing.
    34. Section 95.23 is revised to read as follows:


Sec. 95.23  Termination of facility clearance.

    (a) Facility clearance will be terminated when--
    (1) There is no longer a need to use, process, store, reproduce, 
transmit, transport or handle classified matter at the facility; or
    (2) The Commission makes a determination that continued facility

[[Page 17693]]

clearance is not in the interest of national security.
    (b) When facility clearance is terminated, the licensee or other 
person will be notified in writing of the determination and the 
procedures outlined in Sec. 95.53 apply.
    35. In Sec. 95.25, the section heading and paragraphs (a), (b), 
(c), (d), (g), (h), and (i) are revised and paragraph (j) is added to 
read as follows:


Sec. 95.25  Protection of classified information in storage.

    (a) Secret documents, while unattended or not in actual use, must 
be stored in--
    (1) A safe, steel file cabinet, or safe-type steel file container 
that has an automatic unit locking mechanism. All such receptacles will 
be accorded supplemental protection during non-working hours; or
    (2) Any steel file cabinet that has four sides and a top and bottom 
(all permanently attached by welding, rivets or peened bolts so the 
contents cannot be removed without leaving visible evidence of entry) 
and is secured by a rigid metal lock bar and an approved key operated 
or combination padlock. The keepers of the rigid metal lock bar must be 
secured to the cabinet by welding, rivets, or bolts, so they cannot be 
removed and replaced without leaving evidence of the entry. The drawers 
of the container must be held securely, so their contents cannot be 
removed without forcing open the drawer. This type cabinet will be 
accorded supplemental protection during non-working hours.
    (b) Confidential matter while unattended or not in use must be 
stored in the same manner as SECRET matter except that no supplemental 
protection is required.
    (c) Classified lock combinations.
    (1) A minimum number of authorized persons may know the 
combinations to authorized storage containers. Security containers, 
vaults, cabinets, and other authorized storage containers must be kept 
locked when not under the direct supervision of an authorized person 
entrusted with the contents.
    (2) Combinations must be changed by a person authorized access to 
the contents of the container, or by the Facility Security Officer or 
his or her designee. Combinations must be changed upon--
    (i) The initial use of an approved container or lock for the 
protection of classified material;
    (ii) The termination of employment of any person having knowledge 
of the combination, or when the clearance granted to any such person 
has been withdrawn, suspended, or revoked;
    (iii) The compromise or suspected compromise of a container or its 
combination, or discovery of a container left unlocked and unattended; 
or
    (iv) At other times when considered necessary by the Facility 
Security Officer or CSA.
    (d) Records of combinations. If a record is made of a combination, 
the record must be marked with the highest classification of material 
authorized for storage in the container. Superseded combinations must 
be destroyed.
* * * * *
    (g) Posted information. Containers may not bear external markings 
indicating the level of classified material authorized for storage. A 
record of the names of persons having knowledge of the combination must 
be posted inside the container.
    (h) End of day security checks.
    (1) Facilities that store classified material shall establish a 
system of security checks at the close of each working day to ensure 
that all classified material and security repositories have been 
appropriately secured.
    (2) Facilities operating with multiple work shifts shall perform 
the security checks at the end of the last working shift in which 
classified material had been removed from storage for use. The checks 
are not required during continuous 24-hour operations.
    (i) Unattended security container found opened. If an unattended 
security container housing classified matter is found unlocked, the 
custodian or an alternate must be notified immediately. The container 
must be secured by protective personnel and the contents inventoried as 
soon as possible but not later than the next workday. A report 
reflecting all actions taken must be submitted to the responsible 
Regional Office (see appendix A, 10 CFR part 73 for addresses) with an 
information copy to the NRC Division of Security. The licensee shall 
retain records pertaining to these matters for three years after 
completion of final corrective action.
    (j) Supervision of keys and padlocks. Use of key-operated padlocks 
are subject to the following requirements:
    (1) A key and lock custodian shall be appointed to ensure proper 
custody and handling of keys and locks used for protection of 
classified material;
    (2) A key and lock control register must be maintained to identify 
keys for each lock and their current location and custody;
    (3) Keys and locks must be audited each month;
    (4) Keys must be inventoried with each change of custody;
    (5) Keys must not be removed from the premises;
    (6) Keys and spare locks must be protected equivalent to the level 
of classified material involved;
    (7) Locks must be changed or rotated at least annually, and must be 
replaced after loss or compromise of their operable keys; and
    (8) Master keys may not be made.
    36. Section 95.27 is revised to read as follows:


Sec. 95.27  Protection while in use.

    While in use, matter containing classified information must be 
under the direct control of an authorized individual to preclude 
physical, audio, and visual access by persons who do not have the 
prescribed access authorization or other written CSA disclosure 
authorization (see Sec. 95.36 for additional information concerning 
disclosure authorizations).
    37. Section 95.29 is revised to read as follows:


Sec. 95.29  Establishment of Restricted or Closed areas.

    (a) If, because of its nature, sensitivity or importance, matter 
containing classified information cannot otherwise be effectively 
controlled in accordance with the provisions of Secs. 95.25 and 95.27, 
a Restricted or Closed Area must be established to protect such matter.
    (b) The following measures apply to Restricted Areas:
    (1) Restricted areas must be separated from adjacent areas by a 
physical barrier designed to prevent unauthorized access (physical, 
audio, and visual) into these areas.
    (2) Controls must be established to prevent unauthorized access to 
and removal of classified matter.
    (3) Access to classified matter must be limited to persons who 
possess appropriate access authorization or other written CSA 
disclosure authorization and who require access in the performance of 
their official duties or regulatory obligations.
    (4) Persons without appropriate access authorization for the area 
visited must be escorted by an appropriate CSA access authorized person 
at all times while within Restricted or Closed Areas.
    (5) Each individual authorized to enter a Restricted or Closed Area 
must be issued a distinctive form of identification (e.g., badge) when 
the number of employees assigned to the area exceeds thirty per shift.
    (6) During nonworking hours, admittance must be controlled by 
protective personnel. Protective personnel shall conduct patrols during 
nonworking hours at least every 8 hours

[[Page 17694]]

and more frequently if necessary to maintain a commensurate level of 
protection. Entrances must be continuously monitored by protective 
personnel or by an approved alarm system.
    (c) Due to the size and nature of the classified material, or 
operational necessity, it may be necessary to construct Closed Areas 
for storage because GSA-approved containers or vaults are unsuitable or 
impractical. Closed Areas must be approved by the CSA. The following 
measures apply to Closed Areas:
    (1) Access to Closed Areas must be controlled to preclude 
unauthorized access. This may be accomplished through the use of a 
cleared employee or by a CSA approved access control device or system.
    (2) Access must be limited to authorized persons who have an 
appropriate security clearance and a need-to-know for the classified 
material/information within the area. Persons without the appropriate 
level of clearance and/or need-to-know must be escorted at all times by 
an authorized person where inadvertent or unauthorized exposure to 
classified information cannot otherwise be effectively prevented.
    (3) The Closed Area must be accorded supplemental protection during 
non-working hours. During these hours, admittance to the area must be 
controlled by locked entrances and exits secured by either an approved 
built-in combination lock or an approved combination or key-operated 
padlock. However, doors secured from the inside with a panic bolt (for 
example, actuated by a panic bar), a dead bolt, a rigid wood or metal 
bar, or other means approved by the CSA, do not require additional 
locking devices.
    (4) Open shelf or bin storage of classified documents in Closed 
Areas requires CSA approval. Only areas protected by an approved 
intrusion detection system will qualify for approval.
    38. Section 95.31 is revised to read as follows:


Sec. 95.31  Protective personnel.

    Whenever protective personnel are used to protect classified 
information they shall:
    (a) Possess an ``L'' access authorization (or CSA equivalent) if 
the licensee or other person possesses information classified 
Confidential National Security Information, Confidential Restricted 
Data or Secret National Security Information.
    (b) Possess a ``Q'' access authorization (or CSA equivalent) if the 
licensee or other person possesses Secret Restricted Data related to 
nuclear weapons design, manufacturing and vulnerability information; 
and certain particularly sensitive Naval Nuclear Propulsion Program 
information (e.g., fuel manufacturing technology) and the protective 
personnel require access as part of their regular duties.
    39. Section 95.33 is revised to read as follows:


Sec. 95.33  Security education.

    All cleared employees must be provided with security training and 
briefings commensurate with their involvement with classified 
information. The facility may obtain defensive security, threat 
awareness, and other education and training information and material 
from their CSA or other sources.
    (a) Facility Security Officer Training. Licensees and others are 
responsible for ensuring that the Facility Security Officer, and others 
performing security duties, complete security training deemed 
appropriate by the CSA. Training requirements must be based on the 
facility's involvement with classified information and may include a 
Facility Security Officer orientation course and, for Facility Security 
Officers at facilities with safeguarding capability, a Facility 
Security Officer Program Management Course. Training, if required, 
should be completed within 1 year of appointment to the position of 
Facility Security Officer.
    (b) Government-Provided Briefings. The CSA is responsible for 
providing initial security briefings to the Facility Security Officer, 
and for ensuring that other briefings required for special categories 
of information are provided.
    (c) Temporary Help Suppliers. A temporary help supplier, or other 
contractor who employs cleared individuals solely for dispatch 
elsewhere, is responsible for ensuring that required briefings are 
provided to their cleared personnel. The temporary help supplier or the 
using licensee or other facility may conduct these briefings.
    (d) Classified Information Nondisclosure Agreement (SF-312). The 
SF-312 is an agreement between the United States and an individual who 
is cleared for access to classified information. An employee issued an 
initial access authorization must, in accordance with the requirements 
of Sec. 25.23 of this chapter, execute an SF-312 before being granted 
access to classified information. The Facility Security Officer shall 
forward the executed SF-312 to the CSA for retention. If the employee 
refuses to execute the SF-312, the licensee or other facility shall 
deny the employee access to classified information and submit a report 
to the CSA. The SF-312 must be signed and dated by the employee and 
witnessed. The employee's and witness' signatures must bear the same 
date.
    (e) Initial Security Briefings. Before being granted access to 
classified information, an employee shall receive an initial security 
briefing that includes the following topics:
    (1) A Threat Awareness Briefing.
    (2) A Defensive Security Briefing.
    (3) An overview of the security classification system.
    (4) Employee reporting obligations and requirements.
    (5) Security procedures and duties applicable to the employee's 
job.
    (f) Refresher Briefings. The licensee or other facility shall 
conduct periodic refresher briefings for all cleared employees. As a 
minimum, the refresher briefing must reinforce the information provided 
during the initial briefing and inform employees of appropriate changes 
in security regulations. This requirement may be satisfied by use of 
audio/video materials and by issuing written materials on a regular 
basis.
    (g) Debriefings. Licensee and other facilities shall debrief 
cleared employees at the time of termination of employment (discharge, 
resignation, or retirement); when an employee's access authorization is 
terminated, suspended, or revoked; and upon termination of the Facility 
Clearance.
    (h) Records reflecting an individual's initial and refresher 
security orientations and security termination must be maintained for 
three years after termination of the individual's access authorization.
    40. Section 95.36 is revised to read as follows:


Sec. 95.36  Access by representatives of the International Atomic 
Energy Agency or by participants in other international agreements.

    (a) Based upon written disclosure authorization from the NRC 
Division of Security that an individual is an authorized representative 
of the International Atomic Energy Agency (IAEA) or other international 
organization and that the individual is authorized to make visits or 
inspections in accordance with an established agreement with the United 
States Government, a licensee, certificate holder or other person 
subject to this part shall permit the individual (upon presentation of 
the credentials specified in Sec. 75.7 of this chapter and any other 
credentials identified in the disclosure

[[Page 17695]]

authorization) to have access to matter which is classified National 
Security Information that is relevant to the conduct of a visit or 
inspection. A disclosure authorization under this section does not 
authorize a licensee, certificate holder, or other person subject to 
this part to provide access to Restricted Data.
    (b) For purposes of this section, classified National Security 
Information is relevant to the conduct of a visit or inspection if--
    (1) In the case of a visit, this information is needed to verify 
information according to Sec. 75.13 of this chapter; or
    (2) In the case of an inspection, an inspector is entitled to have 
access to the information under Sec. 75.42 of this chapter.
    (c) In accordance with the specific disclosure authorization 
provided by the Division of Security, licensees or other persons 
subject to this part are authorized to release (i.e., transfer 
possession of) copies of documents which contain classified National 
Security Information directly to IAEA inspectors and other 
representatives officially designated to request and receive classified 
National Security Information documents. These documents must be marked 
specifically for release to IAEA or other international organizations 
in accordance with instructions contained in the NRC's disclosure 
authorization letter. Licensees and other persons subject to this part 
may also forward these documents through the NRC to the international 
organization's headquarters in accordance with the NRC disclosure 
authorization. Licensees and other persons may not reproduce documents 
containing classified National Security Information except as provided 
in Sec. 95.43.
    (d) Records regarding these visits and inspections must be 
maintained for five years beyond the date of the visit or inspection. 
These records must specifically identify each document which has been 
released to an authorized representative and indicate the date of the 
release. These records must also identify (in such detail as the 
Division of Security, by letter, may require) the categories of 
documents that the authorized representative has had access and the 
date of this access. A licensee or other person subject to this part 
shall also retain Division of Security disclosure authorizations for 
five years beyond the date of any visit or inspection when access to 
classified information was permitted.
    (e) Licensees or other persons subject to this part shall take such 
measures as may be necessary to preclude access to classified matter by 
participants of other international agreements unless specifically 
provided for under the terms of a specific agreement.
    41. Section 95.37 is revised to read as follows:


Sec. 95.37  Classification and preparation of documents.

    (a) Classification. Classified information generated or possessed 
by a licensee or other person must be appropriately marked. Classified 
material which is not conducive to markings (e.g., equipment) may be 
exempt from this requirement. These exemptions are subject to the 
approval of the CSA on a case-by-case basis. If a person or facility 
generates or possesses information that is believed to be classified 
based on guidance provided by the NRC or by derivation from classified 
documents, but which no authorized classifier has determined to be 
classified, the information must be protected and marked with the 
appropriate classification markings pending review and signature of an 
NRC authorized classifier. This information shall be protected as 
classified information pending final determination.
    (b) Classification consistent with content. Each document 
containing classified information shall be classified Secret or 
Confidential according to its content. NRC licensees or others subject 
to the requirements of 10 CFR Part 95 may not make original 
classification decisions.
    (c) Markings required on face of documents.
    (1) For derivative classification of classified National Security 
Information:
    (i) Derivative classifications of classified National Security 
Information must contain the identity of the source document or the 
classification guide, including the agency and office of origin, on the 
``Derived From'' line and its classification date. If more than one 
source is cited, the ``Derived From'' line should indicate ``Multiple 
Sources.''
    (ii) Declassification instructions. When marking derivatively 
classified documents, the ``DECLASSIFY ON'' line must carry forward the 
declassification instructions as reflected in the original document. If 
multiple sources are used, the instructions will carry forward the 
longest duration.
    (iii) If the source document used for derivative classification 
contains the declassification instruction, ``Originating Agency's 
Determination Required'' (OADR), the new document should reflect the 
date of the original classification of the information as contained in 
the source document or classification guide. An example of the stamp 
might be as follows:

Derived From-----------------------------------------------------------
(Source)
Reason-----------------------------------------------------------------
Declassify On: Source Marked ``OADR''
Date of Source:--------------------------------------------------------
Classifier:------------------------------------------------------------
(Name/Title/Number)

    (iv) The derivative classifier shall maintain the identification of 
each source with the file or record copy of the derivatively classified 
document.
    (2) For Restricted Data documents:
    (i) Identity of the classifier. The identity of the classifier must 
be shown by completion of the ``Derivative Classifier'' line. The 
``Derivative Classifier'' line must show the name of the person 
classifying the document and the basis for the classification. Dates 
for downgrading or declassification do not apply.
    (ii) Classification designation (e.g., Secret, Confidential) and 
Restricted Data. NOTE: No ``Declassification'' instructions will be 
placed on documents containing Restricted Data.
    (d) Placement of markings. The highest classification marking 
assigned to a document must be placed in a conspicuous fashion in 
letters at the top and bottom of the outside of the front covers and 
title pages, if any, and first and last pages on which text appears, on 
both bound and unbound documents, and on the outside of back covers of 
bound documents. The balance of the pages must be marked at the top and 
bottom with:
    (1) The overall classification marking assigned to the document;
    (2) The highest classification marking required by content of the 
page; or
    (3) The marking UNCLASSIFIED if they have no classified content.
    (e) Additional markings.
    (1) If the document contains any form of Restricted Data, it must 
bear the appropriate marking on the first page of text, on the front 
cover and title page, if any. For example: ``This document contains 
Restricted Data as defined in the Atomic Energy Act of 1954. 
Unauthorized disclosure subject to Administrative and Criminal 
Sanctions.''
    (2) Limitation on reproduction or dissemination. If the originator 
or classifier determines that reproduction or further dissemination of 
a document should be restricted, the following additional wording may 
be placed on the face of the document:

Reproduction or Further Dissemination Requires Approval of
----------------------------------------------------------------------

[[Page 17696]]

If any portion of this additional marking does not apply, it should 
be crossed out.

    (f) Portion markings. In addition to the information required on 
the face of the document, each classified document is required, by 
marking or other means, to indicate clearly which portions are 
classified (e.g., paragraphs or pages) and which portions are not 
classified. The symbols (S) for Secret, (C) for Confidential, (U) for 
Unclassified, or (RD) for Restricted Data may be used immediately 
preceding or following the text to which it applies, except that the 
designation must follow titles or subjects. (Portion marking of 
paragraphs is not required for documents containing Restricted Data.) 
If this type of portion marking is not practicable, the document must 
contain a description sufficient to identify the classified information 
and the unclassified information.

Example

Pages 1-3  Secret
Pages 4-19  Unclassified
Pages 20-26  Secret
Pages 27-32  Confidential

    (g) Transmittal document. If a document transmitting classified 
information contains no classified information or the classification 
level of the transmittal document is not as high as the highest 
classification level of its enclosures, then the document must be 
marked at the top and bottom with a classification at least as high as 
its highest classified enclosure. The classification may be higher if 
the enclosures, when combined, warrant a higher classification than any 
individual enclosure. When the contents of the transmittal document 
warrants a lower classification than the highest classified 
enclosure(s) or combination of enclosures or requires no 
classification, a stamp or marking such as the following must also be 
used on the transmittal document:

    UPON REMOVAL OF ATTACHMENTS THIS DOCUMENT IS:

(Classification level of transmittal document standing alone or the 
word ``UNCLASSIFIED'' if the transmittal document contains no 
classified information.)

    (h) Classification challenges. Persons in authorized possession of 
classified National Security Information who in good faith believe that 
the information's classification status (i.e. that the document), is 
classified at either too high a level for its content 
(overclassification) or too low for its content (underclassification) 
are expected to challenge its classification status. Persons who wish 
to challenge a classification status shall--
    (1) Refer the document or information to the originator or to an 
authorized NRC classifier for review. The authorized classifier shall 
review the document and render a written classification decision to the 
holder of the information.
    (2) In the event of a question regarding classification review, the 
holder of the information or the authorized classifier shall consult 
the NRC Division of Security, Information Security Branch, for 
assistance.
    (3) Persons who challenge classification decisions have the right 
to appeal the classification decision to the Interagency Security 
Classification Appeals Panel.
    (4) Persons seeking to challenge the classification of information 
will not be the subject of retribution.
    (i) Files, folders or group of documents. Files, folders, binders, 
or groups of physically connected documents must be marked at least as 
high as the highest classified document which they contain.
    (j) Drafts and working papers. Drafts of documents and working 
papers which contain, or which are believed to contain, classified 
information must be marked as classified information.
    (k) Classification guidance. Licensees, certificate holders, or 
other persons subject to this part shall classify and mark classified 
matter as National Security Information or Restricted Data, as 
appropriate, in accordance with classification guidance provided by the 
NRC as part of the facility clearance process.
    42. Section 95.39 is revised to read as follows:


Sec. 95.39  External transmission of documents and material.

    (a) Restrictions. Documents and material containing classified 
information received or originated in connection with an NRC license or 
certificate must be transmitted only to CSA approved security 
facilities.
    (b) Preparation of documents. Documents containing classified 
information must be prepared in accordance with the following when 
transmitted outside an individual installation.
    (1) The documents must be enclosed in two sealed opaque envelopes 
or wrappers.
    (2) The inner envelope or wrapper must contain the addressee's 
classified mail address and the name of the intended recipient. The 
appropriate classification must be placed on both sides of the envelope 
(top and bottom) and the additional markings, as appropriate, referred 
to in Sec. 95.37(e) must be placed on the side bearing the address.
    (3) The outer envelope or wrapper must contain the addressee's 
classified mail address. The outer envelope or wrapper may not contain 
any classification, additional marking or other notation that indicates 
that the enclosed document contains classified information.
    (4) A receipt that contains an unclassified description of the 
document, the document number, if any, date of the document, 
classification, the date of transfer, the recipient and the person 
transferring the document must be enclosed within the inner envelope 
containing the document and be signed by the recipient and returned to 
the sender whenever the custody of a Secret document is transferred. 
This receipt process is at the option of the sender for Confidential 
information.
    (c) Methods of transportation.
    (1) Secret matter may be transported only by one of the following 
methods within and directly between the U.S., Puerto Rico, or a U.S. 
possession or trust territory:
    (i) U.S. Postal Service Express Mail and U.S. Postal Service 
Registered Mail.

    Note: The ``Waiver of Signature and Indemnity'' block on the 
U.S. Postal Service Express Mail Label 11-B may not be executed and 
the use of external (street side) express mail collection boxes is 
prohibited.

    (ii) A cleared ``Commercial Carrier.''
    (iii) A cleared commercial messenger service engaged in the 
intracity/local area delivery (same day delivery only) of classified 
material.
    (iv) A commercial delivery company, approved by the CSA, that 
provides nationwide, overnight service with computer tracing and 
reporting features. These companies need not be security cleared.
    (v) Other methods as directed, in writing, by the CSA.
    (2) Confidential matter may be transported by one of the methods 
set forth in paragraph (c)(1) of this section, by U.S. first class, 
express or certified mail. First class, express, or certified mail may 
be used in transmission of Confidential documents to Puerto Rico or any 
United States territory or possession.
    (d) Telecommunication of classified information. Classified 
information may not be telecommunicated unless the telecommunication 
system has been approved by the CSA. Licensees, certificate holders or 
other persons who may require a secure telecommunication system shall 
submit a telecommunication plan as part of their

[[Page 17697]]

request for facility clearance, as outlined in Sec. 95.15, or as an 
amendment to their existing Standard Practice Procedures Plan for the 
protection of classified information.
    (e) Security of classified information in transit. Classified 
matter that, because of its nature, cannot be transported in accordance 
with Sec. 95.39(c), may only be transported in accordance with 
procedures approved by the CSA. Procedures for transporting classified 
matter are based on a satisfactory transportation plan submitted as 
part of the licensee's, certificate holder, or other person's request 
for facility clearance or submitted as an amendment to its existing 
Standard Practice Procedures Plan.
    43. Section 95.41 is revised to read as follows:


Sec. 95.41  External receipt and dispatch records.

    Each licensee, certificate holder or other person possessing 
classified information shall maintain a record that reflects:
    (a) The date of the material;
    (b) The date of receipt or dispatch;
    (c) The classification;
    (d) An unclassified description of the material; and
    (e) The identity of the sender from which the material was received 
or recipient to which the material was dispatched. Receipt and dispatch 
records must be retained for 2 years.
    44. Section 95.43 is revised to read as follows:


Sec. 95.43  Authority to reproduce.

    (a) Each licensee or other person possessing classified information 
shall establish a reproduction control system to ensure that 
reproduction of classified material is held to the minimum consistent 
with operational requirements. Classified reproduction must be 
accomplished by authorized employees knowledgeable of the procedures 
for classified reproduction. The use of technology that prevents, 
discourages, or detects the unauthorized reproduction of classified 
documents is encouraged.
    (b) Unless restricted by the CSA, Secret and Confidential documents 
may be reproduced. Reproduced copies of classified documents are 
subject to the same protection as the original documents.
    (c) All reproductions of classified material must be conspicuously 
marked with the same classification markings as the material being 
reproduced. Copies of classified material must be reviewed after the 
reproduction process to ensure that these markings are visible.
    45. Section 95.45 is revised to read as follows:


Sec. 95.45  Changes in classification.

    (a) Documents containing classified National Security Information 
must be downgraded or declassified as authorized by the NRC 
classification guides or as determined by the NRC. Requests for 
downgrading or declassifying any NRC classified information should be 
forwarded to the NRC Division of Security, Office of Administration, 
Washington, DC 20555-0001. Requests for downgrading or declassifying of 
Restricted Data will be forwarded to the NRC Division of Security for 
coordination with the Department of Energy.
    (b) If a change of classification or declassification is approved, 
the previous classification marking must be canceled and the following 
statement, properly completed, must be placed on the first page of the 
document:

    Classification canceled (or changed to)

----------------------------------------------------------------------
(Insert appropriate classification)
    By authority of

----------------------------------------------------------------------
(Person authorizing change in classification)
    By

----------------------------------------------------------------------
(Signature of person making change and date thereof)

    (c) New markings reflecting the current classification status of 
the document will be applied in accordance with the requirements of 
Sec. 95.37.
    (d) Any persons making a change in classification or receiving 
notice of such a change shall forward notice of the change in 
classification to holders of all copies as shown on their records.
    46. Section 95.47 is revised to read as follows:


Sec. 95.47  Destruction of matter containing classified information.

    Documents containing classified information may be destroyed by 
burning, pulping, or another method that ensures complete destruction 
of the information that they contain. The method of destruction must 
preclude recognition or reconstruction of the classified information. 
Any doubts on methods should be referred to the CSA. If the document 
contains Secret information, a record of the subject or title, document 
number, if any, originator, its date of origination and the date of 
destruction must be signed by the person destroying the document and 
must be maintained in the office of the custodian at the time of 
destruction. These destruction records must be retained for two years 
after destruction.
    47. Section 95.49 is revised to read as follows:


Sec. 95.49  Security of automatic data processing (ADP) systems.

    Classified data or information may not be processed or produced on 
an ADP system unless the system and procedures to protect the 
classified data or information have been approved by the CSA. Approval 
of the ADP system and procedures is based on a satisfactory ADP 
security proposal submitted as part of the licensee's or other person's 
request for facility clearance outlined in Sec. 95.15 or submitted as 
an amendment to its existing Standard Practice Procedures Plan for the 
protection of classified information.
    48. Section 95.51 is revised to read as follows:


Sec. 95.51  Retrieval of classified matter following suspension or 
revocation of access authorization.

    In any case where the access authorization of an individual is 
suspended or revoked in accordance with the procedures set forth in 
part 25 of this chapter, or other relevant CSA procedures, the 
licensee, certificate holder or other organization shall, upon due 
notice from the Commission of such suspension or revocation, retrieve 
all classified information possessed by the individual and take the 
action necessary to preclude that individual having further access to 
the information.
    49. Section 95.53 is revised to read as follows:


Sec. 95.53  Termination of facility clearance.

    (a) If the need to use, process, store, reproduce, transmit, 
transport, or handle classified matter no longer exists, the facility 
clearance will be terminated. The facility may deliver all documents 
and materials containing classified information to the Commission or to 
a person authorized to receive them or destroy all such documents and 
materials. In either case, the facility shall submit a certification of 
nonpossession of classified information to the NRC Division of 
Security.
    (b) In any instance where facility clearance has been terminated 
based on a determination of the CSA that further possession of 
classified matter by the facility would not be in the interest of the 
national security, the facility shall, upon notice from the CSA, 
immediately deliver all classified documents and materials to the 
Commission along with a certificate of nonpossession of classified 
information.
    50. Section 95.55 is revised to read as follows:

[[Page 17698]]

Sec. 95.55  Continued applicability of the regulations in this part.

    The suspension, revocation or other termination of access 
authorization or the termination of facility clearance does not relieve 
any person from compliance with the regulations in this part.
    51. Section 95.57 is revised to read as follows:


Sec. 95.57  Reports.

    Each licensee or other person having a facility clearance shall 
immediately report to the CSA and the Regional Administrator of the 
appropriate NRC Regional Office listed in appendix A, 10 CFR part 73:
    (a) Any alleged or suspected violation of the Atomic Energy Act, 
Espionage Act, or other Federal statutes related to classified 
information.
    (b) Any infractions, losses, compromises or possible compromise of 
classified information or classified documents not falling within 
paragraph (a) of this section.
    (c) In addition, an authorized classifier of a licensee, 
certificate holder or other organization subject to this Part shall 
complete an NRC Form 790, ``Classification Record,'' whenever matter 
containing classified information is generated, its classification 
changed or it is declassified. Notification of declassification is not 
required for any document or material which has an automatic 
declassification date. Completed NRC Form 790 must be submitted to the 
NRC Division of Security, Washington, DC 20555-0001, on a monthly 
basis.
    52. Section 95.59 is revised to read as follows:


Sec. 95.59  Inspections.

    The Commission shall make inspections and reviews of the premises, 
activities, records and procedures of any person subject to the 
regulations in this part as the Commission and CSA deem necessary to 
effect the purposes of the Act, E.O. 12958 and/or NRC rules.

    Dated at Rockville, Maryland, this 26th day of March 1997.

    For the Nuclear Regulatory Commission.
L. Joseph Callan,
Executive Director for Operations.
[FR Doc. 97-9063 Filed 4-11-97; 8:45 am]
BILLING CODE 7590-01-P