[Federal Register Volume 64, Number 199 (Friday, October 15, 1999)]
[Rules and Regulations]
[Pages 56114-56128]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-26700]



[[Page 56113]]

_______________________________________________________________________

Part VI





Nuclear Regulatory Commission





_______________________________________________________________________



10 CFR Part 72



Expand Applicability of Part 72 to Holders of, and Applicants for, 
Certificates of Compliance; Final Rule; NRC Enforcement Policy; 
Enforcement Action Against Nonlicensees Under 10 CFR Part 72; Notice of 
Policy Statement; Revision

  Federal Register / Vol. 64, No. 199 / Friday, October 15, 1999 / 
Rules and Regulations  

[[Page 56114]]



NUCLEAR REGULATORY COMMISSION

10 CFR Part 72

RIN 3150-AF93


Expand Applicability of Part 72 to Holders of, and Applicants 
for, Certificates of Compliance

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
regulations to clarify the obligations of holders of, and applicants 
for, Certificates of Compliance (CoCs). These amendments will enhance 
the Commission's ability to take enforcement action against these 
persons when legally binding requirements are violated. This action 
will emphasize the safety and regulatory significance associated with 
violations of the regulations. In addition, a new section identifies 
recordkeeping and reporting requirements for certificate holders and 
applicants for a CoC.

EFFECTIVE DATE: This final rule is effective on December 14, 1999.

FOR FURTHER INFORMATION CONTACT: Anthony DiPalo, telephone (301) 415-
6191, e-mail, [email protected], of the Office of Nuclear Material Safety and 
Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-
0001.

SUPPLEMENTARY INFORMATION:

Background

    The Commission's regulations at 10 CFR part 72 were established to 
provide requirements for the issuance of licenses for the storage of 
spent nuclear fuel in an independent spent fuel storage installation 
(ISFSI) (45 FR 74693; November 12, 1980). In 1990, the Commission 
amended part 72 to include a process for approving the design of spent 
fuel storage casks and issuance of a CoC (subpart L) and for granting a 
general license to reactor licensees (subpart K) to use NRC-approved 
casks for storage of spent nuclear fuel (55 FR 29181; July 18, 1990). 
In the past, the Commission has experienced performance problems in the 
areas of design, design control, fabrication and quality control with 
holders of, and applicants for, a CoC under part 72. When the NRC 
identifies a failure to comply with part 72 requirements by these 
persons, the enforcement sanctions available have been limited to 
administrative actions.
    The NRC Enforcement Policy 1 and its implementing 
program was established to support the NRC's overall safety mission in 
protecting public health and safety and the environment. Consistent 
with this purpose, enforcement actions are used as a deterrent to 
emphasize the importance of compliance with requirements and to 
encourage prompt identification and comprehensive correction of the 
violations. Enforcement sanctions consist of Notices of Violation 
(NOVs), civil penalties, and orders of various types. In addition to 
formal enforcement actions, the NRC also uses related administrative 
actions such as Notices of Nonconformance (NONs), Confirmatory Action 
Letters, and Demands for Information to supplement its enforcement 
program. The NRC expects licensees, certificate holders, and applicants 
for a CoC to adhere to any obligations and commitments that result from 
these actions and will not hesitate to issue appropriate orders to 
ensure that these obligations and commitments are met. The nature and 
extent of the enforcement action are intended to reflect the 
seriousness of the violation involved. An NOV is a written notice 
setting forth one or more violations of a legally binding requirement.
---------------------------------------------------------------------------

    \1\  NUREG-1600, Revision 1, ``General Statement of Policy and 
Procedures for NRC Enforcement Actions,'' May 1998 (at 63 FR 26630; 
May 13, 1998).
---------------------------------------------------------------------------

    The Commission published a proposed rule in the Federal Register 
(63 FR 39526; July 23, 1998). The comment period ended on October 6, 
1998, and four comment letters were received on the proposed rule.

Discussion

    In promulgating subpart L, the NRC intended that selected part 72 
provisions would apply to spent fuel storage cask certificate holders 
and applicants for a CoC. For example, Sec. 72.234(b) requires that, as 
a condition for approval of a CoC, ``[d]esign, fabrication, testing, 
and maintenance of spent fuel storage casks be conducted under a 
quality assurance program that meets the requirements of subpart G of 
this part.'' However, the quality assurance (QA) requirements in 
subpart G refer only to licensees and applicants for licenses, and not 
to certificate holders. Further, some subpart L regulations apply 
explicitly to ``the applicant'' (e.g., Sec. 72.232) or to ``the cask 
vendor'' (e.g., Sec. 72.234(d)(1)). Some of these provisions are 
written in the passive voice so that it is not clear who is responsible 
for meeting the requirement (e.g., Sec. 72.236). Although CoCs are 
legally binding documents, certificate holders or applicants for a CoC 
have not clearly been brought within the scope of part 72 requirements. 
Because the terms ``certificate holder'' and ``applicant for a 
certificate of compliance'' do not appear in the above-cited part 72 
regulations, the NRC has not had a clear basis to cite these persons 
for violations of part 72 requirements in the same way it treats 
licensees. When the NRC has identified a failure to comply with part 72 
requirements by these persons, it has issued an NON rather than an NOV.
    Although an NON and an NOV appear to be similar, the Commission 
prefers the issuance of an NOV because: (1) The issuance of an NOV 
effectively conveys to both the person violating the requirement and 
the public that a violation of a legally binding requirement has 
occurred; (2) the use of graduated severity levels associated with an 
NOV allows the NRC to effectively convey to both the person violating 
the requirement and the public a clearer perspective on the safety and 
regulatory significance of the violation; and (3) violation of a 
regulation reflects the NRC's conclusion that potential risk to public 
health and safety could exist.
    Over the last 2 years, the Commission has observed repeated 
problems with the performance of several certificate holders. These 
problems have occurred in design, design control, fabrication and 
corrective action areas. Problems in these areas are typically covered 
under the QA program. In FY 1996, the NRC staff identified numerous 
instances when certificate holders and their contractors and 
subcontractors failed to comply with the requirements of part 72. The 
Commission has concluded that use of the additional enforcement 
sanctions, which are available in the NRC Enforcement Policy, is 
required to address the performance problems that have occurred in the 
spent fuel storage industry. Therefore, the Commission is revising part 
72 to explicitly state that certificate holders and applicants for a 
CoC must comply with part 72 regulations.

Summary of the Proposed Rule Amendments

    The following is a summary of the amendments that were discussed in 
the proposed rule (63 FR 39526; July 23, 1998). This summary does not 
include changes made in the final rule in response to public comments. 
A summary of the final amendments is discussed in a separate section in 
this notice.

[[Page 56115]]

Subpart A--General Provisions

Section 72.2  Scope

    The term spent fuel storage cask would be added to paragraph (b) of 
this section. This is a conforming amendment.

Section 72.3  Definitions

    The definitions for spent fuel storage cask, certificate holder, 
and certificate of compliance would be added to this section. The term 
spent fuel storage cask would be added to the existing definitions for 
design bases and structures, systems, and components (SSC) important to 
safety. The definition for design capacity would be revised to be 
consistent with the Commission's policy on use of metric units.

Section 72.9  Information Collection Requirements: OMB Approval

    This section would be revised as a conforming amendment, because of 
the addition of new Sec. 72.242.

Section 72.10  Employee Protection and

Section 72.11  Completeness and Accuracy of Information

    The terms certificate holder and applicants for a Commission 
license or a CoC would be added for clarification.

Subpart D--Records, Reports, Inspections, and Enforcement

Section 72.86  Criminal Penalties

    Paragraph (b) currently includes those sections under which 
criminal sanctions are not issued. This paragraph has been revised to 
delete the reference to Sec. 72.236. This section is being revised to 
provide that failure to comply with the specific requirements for spent 
fuel storage cask approval would be subject to the criminal penalty 
provision of Sec. 223 of the Atomic Energy Act. Similarly, certificate 
holders and applicants who fail to comply with the new Sec. 72.242 
(Recordkeeping and reports) would also be subject to criminal 
penalties. Therefore, Sec. 72.242 will not be included in 
Sec. 72.86(b).

Subpart G--Quality Assurance

Sections 72.140 Through 72.176

    In the proposed rule, the term ``certificate holder and applicants 
for a CoC and their contractors and subcontractors'' is added, as 
appropriate, to these sections to define explicitly those 
responsibilities associated with QA requirements. In 1990, when the 
Commission added subparts K and L to part 72 to provide a process for 
approving the design of a spent fuel storage cask, which would be used 
under a general license, the Commission's intent was that certificate 
holders and applicants for a CoC follow the QA regulations of part 72. 
Section 72.234(b) required that activities relating to the design, 
fabrication, testing, and maintenance of spent fuel storage casks must 
be conducted under a QA program that meets the requirements of subpart 
G of part 72. However, the 1990 amendments to part 72 did not amend 
subpart G to include certificate holders and applicants for a CoC. In 
addition, other changes have been made to individual sections of 
subpart G as described below.
    In Sec. 72.140, paragraphs (a) and (b) have been revised to clarify 
the responsibilities of a certificate holder and a licensee with 
respect to who is responsible for ensuring that the QA program is 
properly implemented. Paragraph (c) has been revised to provide 
milestones for a licensee and a certificate holder when the NRC must 
approve their QA program. Paragraph (d) has been revised to permit use 
of an NRC-approved QA program that satisfies the requirements of 
subpart H to part 71 and subpart G of part 72, as well as an approved 
program under Appendix B to part 50. The notification requirement in 
paragraph (d) would be revised to require that the NRC be notified in 
accordance with the standard notification requirements contained in 
Sec. 72.4.
    To provide clarity, Sec. 72.142 has been rearranged. The new 
paragraph (a) has been revised to indicate that all of the persons 
associated with QA activities for an ISFSI or a spent fuel storage cask 
(i.e., the licensee, certificate holder, and applicants for a CoC or 
license, and in the proposed rule their contractors and subcontractors) 
are responsible for implementation of the QA program.
    In Sec. 72.144 paragraphs (a) and (b), Sec. 72.154 paragraph (b), 
Sec. 72.162, and Sec. 72.168 paragraph (a), the term spent fuel storage 
cask has been added to the terms ISFSI and MRS.

Subpart L--Approval of Spent Fuel Storage Casks

Section 72.232  Inspection and Tests

    This section has been reformatted by adding a new paragraph (b) and 
renumbering existing paragraphs (b) and (c). In paragraphs (a), (b), 
and (c), the term ``applicant'' has been replaced with ``certificate 
holder and applicant for a CoC.'' In paragraph (d), the term 
``applicant'' would be replaced with ``certificate holder and applicant 
for a CoC.''
    Paragraph (a) has been revised to permit the inspection of the 
premises and activities related to the design of a spent fuel storage 
cask as well as to the fabrication and testing of such casks. This 
change would be made to ensure completeness.
    A new paragraph (b) includes a requirement to permit the inspection 
of records related to design, fabrication, and testing of spent fuel 
storage casks. This requirement would make clear the responsibility of 
certificate holders and applicants for a CoC to permit access to these 
records. This requirement is similar to the existing inspection and 
testing regulations in 10 CFR Parts 30, 40, 50, and 70.

Section 72.234  Conditions of Approval

    This section has been revised to clarify who is responsible for 
accomplishing these requirements. The term ``cask vendor'' has been 
replaced with ``certificate holder.'' The term ``cask user'' has been 
replaced with ``the licensee using the spent fuel storage cask.'' 
Although the replacement term in the proposed rule was ``the general 
licensee using the cask'' because a specific licensee cannot utilize 
the provisions of subparts K and L, it is conceivable that, in the 
future, a specific licensee could become a user of a certified cask. 
Accordingly, the NRC prefers the broader term. A similar change is made 
in Sec. 72.240 as proposed. Further, edits would be made in 
Secs. 72.234 and 72.236 to clarify that all references to ``casks'' are 
references to ``spent fuel storage casks.'' In addition, the acronym 
``CoC'' would be used in place of the term ``Certificate of 
Compliance,'' where appropriate.

Section 72.236  Specific Requirements for Spent Fuel Storage Cask 
Approval

    This section has been revised to clarify who is responsible for 
accomplishing these requirements. A new sentence would be added at the 
beginning of this section to specify who has responsibility for 
ensuring that each of the requirements contained in paragraphs (a) 
through (m) is met. This section has been reissued as being subject to 
the criminal penalty provisions of Sec. 223 of the Atomic Energy Act. 
Applicants for a CoC would not be required to ensure that the 
requirements of paragraphs (j) and (k) were met because these 
requirements apply to activities that can only occur after a cask has 
been fabricated, and an applicant cannot begin fabrication of a cask 
until a CoC has been issued (see Sec. 72.234(c)).

Section 72.240  Conditions for Spent Fuel Storage Cask Reapproval

    This section has been revised to clarify who is responsible for 
accomplishing these requirements. The

[[Page 56116]]

term ``user of a cask'' has been replaced with ``the licensee using the 
spent fuel storage cask'' and the term ``cask model'' has been replaced 
with ``design of a spent fuel storage cask.'' The term ``representative 
of a cask user'' has been replaced with ``the representative of the 
licensee using the spent fuel storage cask.'' In addition, the acronym 
``CoC'' is used in place of the term ``Certificate of Compliance'' 
where appropriate.

Section 72.242  Recordkeeping and Reports

    This new section identifies recordkeeping and reporting 
requirements for certificate holders and applicants for a CoC that are 
not already covered by the regulations in Sec. 72.234(d). This includes 
records required to be kept by a condition of the CoC or records 
relating to design changes, nonconformances, QA audits, and corrective 
actions. Violations of this section are subject to the criminal penalty 
provisions of Sec. 223 of the Atomic Energy Act of 1954. Paragraphs 
(a), (b), and (c) are similar to the recordkeeping requirements imposed 
on licensees in Sec. 72.80 (a), (c), and (d).
    A new requirement has been established in paragraph (d) for 
certificate holders to submit written reports to the NRC when they 
identify design or fabrication deficiencies, in structures, systems, 
and components that are important to safety for spent fuel storage 
casks that have been delivered to licensees. This requirement would 
inform the NRC of deficiencies that may affect existing casks and 
thereby potentially affect public health and safety. This requirement 
would be similar to the event reporting requirement imposed on 
licensees in Sec. 72.75(c)(2).

Summary of Public Comments on the Proposed Rule

    The NRC received four comment letters on the proposed rule. The 
commenters included a member of the public, one cask fabricator, and 
two part 72 certificate holders. Three of the four commenters favored 
the proposed amendments, and one was opposed. Copies of the public 
comments are available for review in the NRC Public Document Room, 2120 
L Street, NW (Lower Level), Washington, DC 20003-1527. One commenter, a 
member of the public, raised many issues unrelated to this rulemaking 
(e.g., issues that are being addressed in a separate petition for 
rulemaking (i.e., PRM-72-3), the NRC Enforcement Policy, the NRC 
Inspection Program, and NRC oversight of the overall spent fuel storage 
program). The NRC believes these issues are beyond the scope of this 
rule.
    A review of the comments and the Commission's responses follow:
    1. Comment: One commenter, a certificate holder, recommended for 
clarity that in the proposed definition of ``certificate holder'' in 
Sec. 72.3, the words ``company'' or ``organization'' replace the word 
``person,'' because a certificate of compliance is not issued to a 
specific person.
    Response: The NRC disagrees with the comment. The definition of 
``person'' in the rule has the same meaning as ``person'' defined in 
section 11s. of the Atomic Energy Act of 1954. This definition 
encompasses a wide range of entities (i.e., individuals, corporations, 
trusts, government agencies, states, and foreign governments) who may 
wish to apply for a part 72 license or certificate. Therefore, no 
change has been made in the final rule.
    2. Comment: One commenter, a certificate holder, agreed that design 
changes should have appropriate controls. However, the commenter stated 
that it is not clear whether design changes undertaken by the 
certificate holder require prior NRC approval. Currently, Sec. 72.48 
identifies those changes that the licensee may make without prior NRC 
review, and Sec. 72.70 addresses the licensee's responsibility to 
update its Safety Analysis Report (SAR). But, the rule does not apply 
Secs. 72.48 and 72.70 to the certificate holders. The commenter stated 
that the rule did not address whether prior NRC approval is required 
for a design change made by a certificate holder that would necessitate 
a revision of the cask SAR, but would not specifically deviate from the 
CoC; and how the SAR will be updated to reflect these changes.
    The commenter recommended that the proposed revision of 
Sec. 72.146(c) needs clarification of when prior NRC approval is 
required for certificate holders and the means to control changes to 
the SAR that do not require a change to the CoC. The commenter believed 
that the most direct method to address this concern is to revise part 
72 to apply Secs. 72.48 and 72.70 to certificate holders. The commenter 
recognized that NRC intends to pursue changes to Sec. 72.48 in the 
future. However, without changes to Secs. 72.48 and 72.70 at this time, 
the commenter believes that some clarifications are necessary in order 
to implement the proposed revisions to Sec. 72.146(c).
    Response: The NRC agrees in part with the comment. Revising the 
proposed rule to add provisions to permit a certificate holder to use 
the provisions of Sec. 72.48 to make changes to the design of a spent 
fuel storage cask, without prior NRC approval, is beyond the scope of 
this rulemaking. However, the Commission has approved a separate final 
rule on ``Changes, Tests, and Experiments'' (64 FR 53582; October 4, 
1999) that addresses the issues raised by the commenter. The ``Changes, 
Tests, and Experiments'' final rule revises Sec. 72.48 to permit a 
certificate holder to make certain changes to the design of a spent 
fuel storage cask, without NRC prior approval. The ``Changes, Tests, 
and Experiments'' final rule also revises the requirements in 
Sec. 72.70 on licensees in updating their SAR; and adds requirements in 
a new Sec. 72.248 on certificate holders updating their SARs.
    3. Comment: One commenter, a certificate holder, concurs with 
proposed changes for clarification, but believes that the imposition of 
enforcement actions may not be necessary. If the NRC decides that 
enforcement actions are necessary, then the commenter believes that it 
should not apply to the subcontractors of certificate holders, because 
in the commenter's view: (1) It does not seem fair to extend 
enforcement actions to organizations which do not have a direct 
regulatory link to the NRC; and (2) subjecting such contractors and 
subcontractors to enforcement action exposes them to business risks 
which could cause them to refuse to become contractors and 
subcontractors of certificate holders or cause them to increase their 
prices. Another commenter believed that subjecting parties to NRC 
enforcement actions that have no formal regulatory connection presents 
severe business risks that have a real cost to small businesses and 
could prove detrimental to a ``rather small and highly specialized 
group of fabricators.''
    Response: The NRC agrees with the commenters. The NRC expects that 
persons involved in the manufacture of a spent fuel storage cask will 
take full responsibility for their obligations to implement the 
requirements of the part 72 QA regulations. The NRC has reconsidered 
and now believes that the imposition of enforcement actions against 
contractors and subcontractors is not necessary. Section 72.148 
requires that, to the extent necessary, the licensee, certificate 
holder, and applicants shall require contractors or subcontractors to 
provide a QA program consistent with Part 72. Licensees, certificate 
holders, and applicants are responsible for assuring that their 
contractors and subcontractors are implementing adequate QA programs. 
Therefore, the NRC has revised the final

[[Page 56117]]

rule to remove references to contractors and subcontractors.
    4. Comment: One commenter, a certificate holder, raised a concern 
with the proposed extension of enforcement actions to cover 
Sec. 72.236. Several paragraphs in this section, such as (a), (i), and 
(m), contain wording like ``but not limited to'' and ``to the extent 
practicable'' that the commenter believes are highly subjective. The 
commenter does not believe that certificate holders should be subject 
to enforcement actions based on someone's opinion regarding what is 
practicable.
    Response: The NRC recognizes the use of wording ``but not limited 
to'' and ``to the extent practicable,'' could be viewed as subjective, 
when interpreting the regulations; however, the changes to paragraphs 
(a), (i), and (m) did not change the substance of Sec. 72.236. This 
wording is regularly used in statutes and regulations and the NRC 
believes this wording will be reasonably interpreted in enforcement 
actions.
    5. Comment: One commenter, a member of the public, disagreed with 
the proposed language in Sec. 72.140(a) stating that she ``* * * did 
not like the term licensee and certificate holder being simultaneously 
responsible for implementing the quality assurance (QA) requirements 
for oversight of contractors and subcontractors activities.'' The 
commenter was concerned that imposing dual responsibility for the same 
activity was tantamount to implying that no one was responsible. The 
commenter believed there needed to be a clear cut line of 
responsibility to determine what the licensee is actually liable for.
    Response: The NRC disagrees with the comment. The NRC intended that 
both licensees and CoC holders be held accountable for oversight of 
their contractor (i.e., fabricator) activities and that this redundant 
responsibility would ensure that the spent fuel storage casks are 
manufactured in conformance with the approved design and part 72 QA 
requirements. The NRC believes that this approach will have an overall 
positive effect on improving quality in the manufacture of spent fuel 
storage casks.
    6. Comment: One commenter, a certificate holder, agreed with the 
proposed change in Sec. 72.140(c)(2) to require certificate holders to 
obtain NRC approval of its quality assurance program prior to 
commencing fabrication or testing of a spent fuel storage cask. 
However, this commenter also noted that Sec. 72.140(d) states that a 
quality assurance program which satisfies Appendix B to part 50 is 
acceptable for part 72. The commenter also noted that a certificate 
holder may have a quality assurance program that has been approved by 
the NRC under part 71 or approved by the NRC for another part 72 CoC 
application. The commenter suggested that Sec. 72.140(d) be revised to 
include a quality assurance program which has been previously approved 
for part 71 or part 72 as acceptable for new CoC applications under 
part 72.
    Response: The NRC agrees with the comment. The QA requirements 
contained in 10 CFR part 50, appendix B; 10 CFR part 71, subpart H; and 
10 CFR part 72, subpart G, are essentially equivalent. The proposed 
rule revises Sec. 72.140(c), ``Approval of Programs,'' to expand this 
paragraph to indicate that a certificate holder must have an NRC-
approved QA program before commencing fabrication or testing of a spent 
fuel storage cask. The NRC agrees that the definition of an 
``approved'' QA program found in Sec. 72.140(d) should include other 
NRC-approved QA programs. This final rule is revised to allow for the 
use of all NRC-approved QA programs as satisfying the requirements of 
subpart G.
    Additionally, the language in Sec. 72.140(d) is revised to reflect: 
(1) The recordkeeping requirement in Sec. 72.174; and (2) the current 
location for submitting information to the NRC in Sec. 72.4. These 
requirements were added to Sec. 72.140(d) by a different rulemaking 
(see the final rule entitled ``Miscellaneous Changes to Licensing 
Requirements for the Independent Storage of Spent Fuel and High-Level 
Radioactive Waste'' (64 FR 33178; June 22, 1999)). The language in 
Sec. 72.140(c) and (d) is revised to be consistent with paragraph (b) 
of this section to indicate that the requirements in these paragraphs 
apply to a licensee, applicant for a license, certificate holder, and 
applicant for a certificate, as appropriate.
    7. Comment: One commenter, a member of the public, expressed 
concern with the NRC's process for issuing exemptions to the 
requirement in Sec. 72.234(c).

    Note: Section 72.234(c) currently prohibits beginning cask 
fabrication before the NRC issues a Certificate of Compliance.

    Response: The NRC believes this comment is beyond the scope of this 
rulemaking. While Sec. 72.234, ``Conditions for Approval,'' was revised 
in this rulemaking, no change to paragraph (c) of this section was 
proposed. Rather, this section was revised to clarify who is 
responsible for implementing these requirements. The process for 
granting an exemption to part 72 under the provisions of Sec. 72.7, 
including Sec. 72.234(c), is adequate. An amendment to Sec. 72.234(c) 
specifically addressing the issue of beginning cask construction before 
a CoC is issued is addressed in a different rulemaking currently under 
development by the NRC staff (see proposed rulemaking on 
``Clarification and Addition of Flexibility to Part 72,'' RIN-AG15).
    8. Comment: One commenter, a certificate holder, raised the issue 
that the added requirement in Sec. 72.242(d) requires a written report 
when the design or fabrication deficiency affects the ability of 
structures, systems, and components (SSCs) important to safety to 
perform their intended safety function. The commenter indicated that an 
individual SSC may perform more than one function. Some of these may be 
safety related while other functions may not serve a safety function. 
As an example, a coating may assist in heat removal as a function 
important to safety but may also serve as an aesthetic function. For 
this example, the proposed rule could be interpreted to require a 
written report addressing a deficiency associated with an aesthetic 
function, even though the particular component would be capable of 
performing its safety function. It would be an unwarranted use of 
industry and NRC resources to report deficiencies that do not affect a 
safety function. The commenter further raised the issue that the 
deficiency may affect the safety function of such SSCs, but the 
deficiency may not prevent such structure, system, or component from 
performing its intended safety function. As an example, a deficiency in 
a coating may be discovered such that the manufacturer lowers its peak 
heat transfer rating. However, the cask design as stated in the Safety 
Analysis Report may not rely upon such a high rating. It also would be 
an unwarranted use of industry and NRC resources to report deficiencies 
that do not affect the ability of the component to perform its intended 
safety function. The commenter suggested revising Sec. 72.242(d) to 
read as follows: ``* * *deficiency affects the ability of structures, 
systems, and components important to safety to perform their intended 
safety function,'' (emphasis in original).
    Response: The NRC agrees with the comment and the final rule has 
been revised to incorporate the comment.
    9. Comment: One commenter, a cask fabricator, had two objections to 
the proposed rule. First, the commenter was opposed to the potential 
for issuance of NOVs and civil penalties against cask fabricators 
because they have no

[[Page 56118]]

responsibilities or involvement in developing the design configurations 
for the various spent fuel packages. Second, the commenter indicated 
that the proposed changes to Sec. 72.146(a) and (b), ``Design 
Control,'' were troublesome because, under the current procurement 
process for spent fuel packages, the commenter believes fabricators are 
intentionally precluded from the development of front end design and 
licensing activities. The fabricator currently bases manufacturing 
planning documentation upon the adequacy of a customer provided 
specification package. The commenter indicated that the fabricator may 
or may not utilize customer provided drawings for manufacture and that 
where the fabricator generates the drawings the designer and/or 
licensee might require their review and approval, but that there is no 
accepted industry practice on this matter.
    Response: The NRC agrees that contractors and subcontractors need 
not be included within the scope of the changes made in the final rule. 
See the response to comment number 3. Licensees and certificate holders 
are responsible for QA requirements through their oversight of 
contractors and subcontractors, and fabricators are generally 
contractors or subcontractors. However, if the contract calls for the 
fabricator to build according to a design provided by the certificate 
holder, the NRC expects the fabricator to do just that. The NRC needs 
assurance that the spent fuel storage casks are manufactured in 
accordance with the NRC approved design and will hold licensees and 
certificate holders and applicants responsible for meeting design and 
QA requirements. Regarding the commenter's concern on the subject of 
the use of civil penalties; i.e., whether a civil penalty is the 
appropriate response to a violation of part 72, the NRC notes that this 
rulemaking does not provide authority for issuing a civil penalty to 
nonlicensees, other than under the Deliberate Misconduct Rule. The 
final rule does allow the use of issuance of NOV's or Orders, rather 
than administrative sanctions.
    10. Comment: One commenter, a certificate holder, while agreeing 
with the purpose of the proposed rulemaking, raised a concern with the 
added requirement that identifies additional recordkeeping and 
reporting requirements for certificate holders. The NRC estimated the 
burden associated with these new requirements in the Paperwork 
Reduction Act Statement provided with the Supplementary Information in 
the proposed rule as 6 hours annually. The commenter notes that the 
annual burden for recordkeeping and reporting proposed by the revised 
part 72 would far exceed 6 hours annually. The estimate of 6 hours for 
annual training would be sufficient to address the training of 
personnel to implement these new requirements but would not be 
sufficient to address the actual recordkeeping and reporting. Of 
course, the actual burden any individual certificate holder would incur 
because of the required recordkeeping and reporting would vary by 
certificate holder. This commenter believes that the estimated burden 
is greater than 100 hours annually but believes that the purpose of the 
final rule justifies this burden.
    Response: The NRC agrees with the comment. The NRC has reevaluated 
the recordkeeping and reporting burden estimated for Sec. 72.242 and 
concluded that the commenter's estimate of 100 hours annually is 
reasonable. The NRC has verified with the Office of Management and 
Budget (OMB) that burden increase is an extremely small percentage 
increase of the present total 21,454-hour burden for part 72.

Summary of Final Amendments

    The amended sections listed below have not changed from the 
proposed rule and are included in the final rule, some editorial 
changes to improve the organization and readability of the existing 
language have also been made. These are: Secs. 72.2, 72.3, 72.9, 72.10, 
72.86, 72.234, 72.236, 72.240, and 72.242(a), (b), and (c).
    In the final rule, Secs. 72.140, 72.142, 72.144, 72.146, 72.148, 
72.150, 72.152, 72.154, 72.156, 72.158, 72.160, 72.162, 72.164, 72.168, 
72.170, 72.172, 72.174, 72.176, and 72.232 have been revised in 
response to comments, and the terms ``contractor and subcontractor'' 
are removed. However, this action has not been taken in Sec. 72.10 and 
Sec. 72.148, in part, because the current regulation contains those 
terms.
    Additionally, in Sec. 72.148, text at the end of the first sentence 
in the current regulation was inadvertently omitted in the proposed 
rule. It has been restored and will read as follows: ``* * * for 
procurement of material, equipment, and services, whether purchased by 
the licensee, certificate holder, or by their contractors and 
subcontractors.'' (emphasis added)
    In Sec. 72.140 of the final rule, paragraphs (c) and (d) are 
revised in response to comments received on the proposed rule as 
follows:
    Section 72.140 (c) and (d): The QA requirements contained in 10 CFR 
part 50, appendix B; 10 CFR part 71, subpart H; and 10 CFR part 72, 
subpart G, are essentially equivalent. The proposed rule revised 
Sec. 72.140(c), ``Approval of Programs,'' to expand this paragraph to 
indicate that a certificate holder must have an NRC-approved QA program 
before commencing fabrication or testing of a spent fuel storage cask. 
The NRC agrees that the definition of an ``approved'' QA program found 
in Sec. 72.140(d) should include all other NRC-approved QA programs. 
The final rule is revised to allow for the use of all NRC-approved QA 
programs as satisfying the requirements of Subpart G. Additionally, the 
language in Sec. 72.140(d) is revised to reflect the recordkeeping 
requirement in Sec. 72.174 and the address for submitting information 
in Sec. 72.4, which were added to this section by a different 
rulemaking (see Miscellaneous Changes to Licensing Requirements for the 
Independent Storage of Spent Fuel and High-Level Radioactive Waste (see 
64 FR 33178; June 22, 1999). The language in Sec. 72.140(c) and (d) is 
revised to be consistent with paragraph (b) of this section to indicate 
that the requirements in these paragraphs apply to a licensee, 
applicant for a license, certificate holder, and applicant for a 
certificate, as appropriate.
    In the final rule, Sec. 72.242(d) is modified to accept the comment 
that written reports should be made when a design or fabrication 
deficiency affects the ability of SSCs important to safety to perform 
their intended safety function.

Criminal Penalties

    For the purposes of Section 223 of the Atomic Energy Act (AEA), the 
Commission is issuing the final rule to amend 10 CFR part 72: 
Sec. 72.10, 72.11, 72.140 through 72.176, 72.232, 72.234, 72.236, and 
72.242, under one or more of sections 161b, 161i, or 161o of the AEA. 
Willful violations of the rule would be subject to criminal 
enforcement.

Agreement State Compatibility

    Under the ``Policy Statement on Adequacy and Compatibility of 
Agreement State Programs'' approved by the Commission on June 30, 1997, 
and published in the Federal Register on September 3, 1997 (62 FR 
46517), this rule is classified as compatibility Category ``NRC.'' 
Compatibility is not required for Category ``NRC'' regulations. The NRC 
program elements in this category are those that relate directly to 
areas of regulation reserved to the NRC by the AEA or the provisions of 
Title 10 of the Code of Federal Regulations, and although an Agreement

[[Page 56119]]

State may not adopt program elements reserved to NRC, it may wish to 
inform its licensees of certain requirements via a mechanism that is 
consistent with the particular State's administrative procedure laws, 
but does not confer regulatory authority on the State.

Voluntary Consensus Standards

    The National Technology Transfer Act of 1995 (Public Law 104-113) 
requires that Federal agencies use technical standards that are 
developed or adopted by voluntary consensus standards bodies unless the 
use of such a standard is inconsistent with applicable law or otherwise 
impractical. In this final rule, the NRC is expanding the applicability 
of Part 72 to holders of, and applicants for, certificates of 
compliance, and a voluntary consensus standard is not applicable.

Environmental Impact: Categorical Exclusion

    The NRC has determined that this final rule is the type of action 
described as a categorical exclusion in 10 CFR 51.22(c)(2) and (3). 
Therefore, neither an environmental impact statement nor an 
environmental assessment has been prepared for this final rule.

Paperwork Reduction Act Statement

    This final rule increases the burden on licensees by expanding the 
applicability of part 72 to holders of, and applicants for, 
Certificates of Compliance. The public burden for this information 
collection is estimated to average 100 hours annually. Because the 
burden for this information collection is insignificant by comparison 
with current part 72's overall burden, Office of Management and Budget 
(OMB) clearance is not required. Existing requirements were approved by 
the OMB approval number 3150-0132.

Public Protection Notification

    If a means used to impose an information collection does not 
display a currently valid OMB control number, the NRC may not conduct 
or sponsor, and a person is not required to respond to, the information 
collection.

Regulatory Analysis

Statement of the Problem

    The Commission's regulations at 10 CFR part 72 were designed to 
provide specific licensing requirements for the storage of spent 
nuclear fuel in an independent spent fuel storage installation (ISFSI) 
(45 FR 74693; November 12, 1980). These requirements were later amended 
to include the storage of high-level waste (HLW) at a monitored 
retrieval storage (MRS) installation. In 1990, the Commission amended 
part 72 to include a process for approving the design of spent fuel 
storage casks by issuance of a certificate of compliance (subpart L) 
and for granting a general license to reactor licensees (subpart K) to 
use NRC-approved casks for storage of spent nuclear fuel (55 FR 29181; 
July 18, 1990). In the past, the Commission experienced performance 
problems in design, design control, fabrication and quality control 
with holders of, and applicants for, a CoC under part 72.
    When the NRC identifies a failure to comply with part 72 
requirements by these persons, the NRC has issued Notices of 
Nonconformance (NONs). The issuance of an NON does not effectively 
convey that a violation of a legally binding requirement has occurred. 
Because the current regulations do not clearly impose requirements on 
these persons, the NRC has not taken enforcement action, such as a 
Notice of Violation (NOV), against certificate holders and applicants.
    Some part 72 provisions for cask storage of spent fuel (e.g., the 
quality assurance (QA) requirements) were intended to apply to cask 
certificate holders and applicants for cask CoCs, as well as to holders 
of licenses and applicants for a license to store spent nuclear fuel at 
an ISFSI. However, some of the part 72 requirements intended to apply 
to certificate holders and applicants do not clearly bring these 
persons within the scope of the requirement. For this reason, the NRC 
has not had a clear basis to cite certificate holders and applicants 
for a CoC for violations of those part 72 requirements.
    Additionally, broader requirements for recordkeeping and reporting 
for certificate holders and applicants for a CoC to include records 
required to be kept by a condition of the CoC, are needed. Therefore, 
the NRC is adding Sec. 72.242. This will provide an enforcement basis 
equivalence to the recordkeeping and reporting regulations for 
licensees (Sec. 72.80).

Purpose of the Rulemaking

    The purpose of this rulemaking is to expand the applicability of 
part 72 to holders of, and applicants for, CoCs. This would allow the 
NRC staff to take enforcement action in the form of NOVs or orders, 
rather than administrative action in the form of an NON when 
requirements are violated. While it may appear that an NON and an NOV 
are similar, the NRC believes that the issuance of an NOV is preferred 
because: (1) The issuance of an NOV effectively conveys to both the 
person violating the requirement and the public that a violation of a 
legally binding requirement has occurred; (2) the use of graduated 
severity levels associated with an NOV allows the NRC to effectively 
convey to both the person violating the requirement and the public a 
clearer perspective on the safety and regulatory significance of the 
violation; and (3) violation of a regulation reflects the NRC's 
conclusion that potential risk to public health and safety could exist.

Current Regulatory Framework and Proposed Changes

    In promulgating subpart L, the NRC intended that selected part 72 
provisions would apply to cask certificate holders and applicants for a 
CoC. For example, Sec. 72.234(b) requires that, as a condition for 
approval of a CoC, ``[d]esign, fabrication, testing, and maintenance of 
spent fuel storage casks be conducted under a QA program that meets the 
requirements of subpart G of this part.'' However, the QA requirements 
in subpart G refer only to licensees and applicants for licenses and 
not to certificate holders. Some of the subpart L regulations apply 
explicitly only to ``the applicant'' (e.g., Sec. 72.232), or to ``the 
cask vendor'' (e.g., Sec. 72.234(d)(1)). Some are written in the 
passive voice so that it is not clear who is responsible for meeting 
the requirement (e.g., Sec. 72.236). Because of these regulatory 
deficiencies, certificate holders or applicants for a CoC have not 
clearly been brought within the scope of part 72 requirements, and the 
NRC has not had a clear basis to cite these persons for violations of 
part 72 requirements. Presently, when the NRC has identified a failure 
to comply with part 72 requirements by these persons, it has issued an 
administrative action under the NRC's Enforcement Policy.
    The NRC Enforcement Policy and implementing program have been 
established to support the NRC's overall safety mission in protecting 
public health and safety and the environment. Consistent with this 
purpose, enforcement actions are intended to be used as a deterrent to: 
(1) Emphasize the importance of compliance with requirements; and (2) 
encourage prompt identification and comprehensive correction of the 
violations. Enforcement sanctions consist of NOVs, civil penalties, and 
orders of various types. In addition to the formal enforcement actions, 
the NRC also uses related administrative actions such as NONs, 
Confirmatory Action Letters, and Demands for Information to supplement 
the NRC's enforcement program. The NRC expects licensees and holders 
of, and applicants for, a CoC to adhere to

[[Page 56120]]

any obligations and commitments resulting from these actions and will 
not hesitate to issue appropriate orders to ensure that these 
obligations and commitments are met. The nature and extent of the 
enforcement action is intended to reflect the seriousness of the 
violation involved.
    This rule revises the regulations in part 72 to place explicit 
requirements on certificate holders and applicants for a CoC. 
Additionally, terms contained in Subpart L, such as cask user, 
representative of a cask user, cask model, and cask vendor, have been 
clarified. Changes are made to Sec. 72.10, ``Employee Protection,'' and 
Sec. 72.11, ``Completeness and Accuracy of Information,'' to include 
certificate holders and applicants for a CoC. Section 72.3 is revised 
to: (1) Incorporate definitions for ``certificate holder,'' 
``certificate of compliance,'' and ``spent fuel storage cask''; (2) 
amend the definitions for ``design bases'' and ``structures, systems, 
and components important to safety'' to include the term ``spent fuel 
storage cask''; and (3) amend the definition for ``design capacity'' to 
be consistent with the NRC's policy on the use of metric units. Section 
72.236 is revised and reissued as being subject to the criminal penalty 
provisions of Sec. 223 of the Atomic Energy Act of 1954, and 
Sec. 72.86(b), ``Criminal Penalties,'' is revised to delete mention of 
Sec. 72.236 as a conforming change. Section 72.232 is reformatted by 
adding a new paragraph (b) and renumbering existing paragraphs (b) and 
(c). The term ``applicant'' is replaced by the term ``certificate 
holder and applicant for a CoC.'' Requirements to permit inspection of 
records, premises, and activities related to the design, fabrication, 
and testing of spent fuel storage casks have been clarified. Lastly, a 
new Sec. 72.242 is added to subpart L to address additional 
recordkeeping and reporting requirements for certificate holders and 
applicants for a CoC, in addition to those already required by 
Sec. 72.234(d). This new section is similar to the requirements imposed 
on licensees in Sec. 72.80.

Alternatives

    This regulatory analysis considered three alternatives:

Alternative 1: Revise part 72 to expand the applicability of certain 
provisions to certificate holders, applicants for a CoC, and their 
contractors and subcontractors.

    The NRC believes that problems in the areas of quality assurance, 
quality control, fabrication control, and design control exist, are 
significant, and, in part, reflect the fact that certificate holders 
and applicants, and their contractors and subcontractors, have not been 
explicitly included in certain part 72 requirements despite the NRC's 
intent that these persons follow these requirements. Contractors and 
subcontractors actually accomplish the manufacturing and testing of 
spent fuel storage casks.
    Alternative 1 would allow the NRC to issue NOV's or orders against 
these persons, as necessary, by allowing the issuance of an NOV when 
they fail to comply with the requirements of part 72. Presently the NRC 
issues an NON in these instances.
    The NRC has estimated that each certificate holder or applicant for 
a CoC, on average, has three contractors and subcontractors. 
Consequently, the NRC estimates that a total of 60 contractors and 
subcontractors would be affected by changes to part 72 described in 
Alternative 1. Because certificate holders, applicants for a CoC, and 
their contractors and subcontractors, for the most part, have already 
been meeting the requirements of part 72 as either a condition of a CoC 
or as a condition of a contract between a certificate holder and its 
contractors and subcontractors, the burdens imposed by this alternative 
are not significantly increased.
    The NRC believes that Alternative 1 would have enabled the NRC to 
make more effective use of the Enforcement Policy against the 
certificate holders, and their contractors and subcontractors of spent 
fuel storage casks. However, holding contractors and subcontractors 
responsible as contemplated by the proposed rule would dilute the 
message that the Commission's regulations would otherwise make clear--
that licensees and certificate holders are ultimately responsible for 
assuring quality. Furthermore, the current regulations in Sec. 72.148 
make clear that ``[t]o the extent necessary, the licensee shall require 
contractors or subcontractors to provide a quality assurance program 
consistent with the applicable provisions of this subpart [Subpart 
G].''

Alternative 2: Revise part 72 to expand the applicability of certain 
provisions to certificate holders and applicants for a CoC.

    The difference between Alternatives 1 and 2 is that the latter does 
not include contractors and subcontractors in clarifying the 
responsibilities for compliance with part 72. Therefore, the NRC would 
not issue NOVs or orders against these persons under this alternative 
but would continue to use administrative actions. Several comments were 
received that were opposed to adding contractors and subcontractors to 
the regulations. Overall, the commenters felt this action was 
unnecessary and an excessive burden on small entities. The proposed 
rule to extend NRC's regulatory requirements under part 72, subpart G, 
to contractors and subcontractors would be inconsistent with the way in 
which the NRC regulates quality assurance in other arenas, including 
reactor parts and equipment. In both instances, there is a potential 
that deficiencies in the quality assurance program could lead to safety 
related problems. However, NRC's longstanding regulatory approach has 
been to make it clear that licensees are responsible for ensuring that 
the parts and equipment are safe.
    Therefore, the NRC has reconsidered and concluded that contractors 
and subcontractors should not be included in these regulations. 
Consequently, Alternative 2 is adopted.

Alternative 3: No action.

    This alternative was rejected, even though staff resources for 
rulemaking would have been conserved. Under this alternative, it is 
expected that the difficulties the NRC has observed in the past will 
continue.

Decision Rationale for Preferred Alternative

    Alternative 2 is the preferred choice. The major benefit of this 
alternative is to allow the NRC to issue NOVs or Orders against 
certificate holders and applicants for a CoC under the current NRC 
Enforcement Policy, without imposing an unnecessary burden on 
contractors and subcontractors; and ensures that quality assurance 
requirements imposed on contractors and subcontractors are consistent 
for both reactor and material activities. This would enable both the 
person violating the regulation and the public to clearly perceive the 
regulatory and safety significance and consequences of the violation.
    Because certificate holders and applicants for a CoC, for the most 
part, already have been meeting the requirements of part 72 as a 
condition of a CoC, the burdens imposed by this amendment are not 
significantly increased. Additional requirements for recordkeeping and 
reporting for certificate holders are needed, to include records 
required to be kept by a condition of the CoC. This will provide an 
enforcement basis equivalence to the recordkeeping and reporting 
regulations for licensees (Sec. 72.80). Therefore, the NRC is adding 
Sec. 72.242. The new Sec. 72.242 will add

[[Page 56121]]

new burdens for recordkeeping and reporting requirements. The staff 
estimates this burden associated with the new Sec. 72.242 to be 
approximately 100 hours annually. This recordkeeping and reporting 
burden will vary by certificate holders. The NRC believes that the 
purpose of the final rule justifies this burden on certificate holders. 
This burden is insignificant by comparison with part 72's overall 
burden which is in excess of 21,000 hours. In addition, the current 
backfit regulation in Sec. 72.62 applies only to part 72 licensees and 
not to holders of, and applicants for, a CoC. This rule adds 
recordkeeping and reporting requirements for holders of, and applicants 
for, CoCs. Therefore, a backfit analysis is not required for this rule.

Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C. 
605(b), the Commission certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities. 
The final rule amends the regulations to expand the applicability of 10 
CFR part 72 to holders of, and applicants for, CoCs. This requirement 
will enhance the Commission's ability to take enforcement action by 
issuing NOVs or orders rather than administrative action in the form of 
NONs when legally binding requirements are violated. The final rule may 
appear to impose new requirements on some small entities on the 
assumption that could be a certificate holder or applicant able to 
qualify as a ``small entity''. However, these entities, for the most 
part, are already implementing the actions required by the final rule. 
Therefore, the NRC believes that this amendment will not have a 
significant economic impact on any such small entity.

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, Office of Management and Budget.

Backfit Analysis

    The current backfit regulation in Sec. 72.62 applies only to part 
72 licensees and not to holders of, and applicants for, a CoC. This 
rule, in any event, adds only reporting and recordkeeping requirements 
for holders of, and applicants for, CoCs. The Commission has determined 
that reporting and recordkeeping requirements are not considered 
backfits even though they may result in changes to procedures. If the 
reporting or recordkeeping requirements had to meet the standards for a 
backfit analysis, the Commission would have to find that the 
information would substantially increase public health or safety or 
common defense and security without knowing the results of the request. 
In addition, the existence or non-existence of a record or report 
usually has no independent safety significance as compared to actions 
taken by the licensee, certificate holder, or NRC as a result of the 
information contained in the record or report. It is this resulting 
action that affects public health and safety or the common defense or 
security that should be measured under the backfit standard and not the 
method for obtaining or maintaining the information.
    However, the NRC has prepared a regulatory analysis which sets 
forth the objectives of the rulemaking changes, the alternatives that 
were considered, and the expected costs and benefits associated with 
the rulemaking changes. The NRC regards this analysis as providing for 
a disciplined approach for evaluating the impacts of the proposed 
changes, which satisfies the underlying purposes of the backfitting 
requirements in Sec. 72.62.

List of Subjects in 10 CFR Part 72

    Criminal penalties, Manpower training programs, Nuclear materials, 
Occupational safety and health, Reporting and recordkeeping 
requirements, Security measures, Spent fuel.
    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 part 72.

PART 72--LICENSING REQUIREMENTS FOR THE INDEPENDENT STORAGE OF 
SPENT NUCLEAR FUEL AND HIGH-LEVEL RADIOACTIVE WASTE

    1. The authority citation for part 72 is revised to read as 
follows:

    Authority: Secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 
184, 186, 187, 189, 68 Stat. 929, 930, 932, 933, 934, 935, 948, 953, 
954, 955, as amended; sec. 234, 83 Stat. 444, as amended (42 U.S.C. 
2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2232, 2233, 
2234, 2236, 2237, 2238, 2282); sec. 274, Pub. L. 86-373, 73 Stat. 
688, as amended (42 U.S.C. 2021); sec. 201, as amended; 202, 206, 88 
Stat. 1242, as amended; 1244, 1246 (42 U.S.C. 5841, 5842, 5846); 
Pub. L. 95-601, sec. 10, 92 Stat. 2951 as amended by Pub. L. 102-
486, sec. 7902, 106 Stat. 3123 (42 U.S.C. 5851); sec. 102, Pub. L. 
91-190, 83 Stat. 853 (42 U.S.C. 4332); secs. 131, 132, 133, 135, 
137, 141, Pub. L. 97-425, 96 Stat. 2229, 2230, 2232, 2241; sec. 148, 
Pub. L. 100-203, 101 Stat. 1330-235 (42 U.S.C. 10151, 10152, 10153, 
10155, 10157, 10161, 10168).
    Section 72.44(g) also issued under secs. 142(b) and 148(c), (d), 
Pub. L. 100-203, 101 Stat. 1330-232, 1330-236 (42 U.S.C. 10162(b), 
10168(c), (d)). Section 72.46 also issued under sec. 189, 68 Stat. 955 
(42 U.S.C. 2239); sec. 134, Pub. L. 97-425, 96 Stat. 2230 (42 U.S.C. 
10154). Section 72.96(d) also issued under sec. 145(g), Pub. L. 100-
203, 101 Stat. 1330-235 (42 U.S.C. 10165(g)). Subpart J also issued 
under secs. 2(2), 2(15), 2(19), 117(a), 141(h), Pub. L. 97-425, 96 
Stat. 2202, 2203, 2204, 2222, 2224 (42 U.S.C. 10101, 10137(a), 
10161(h)). Subparts K and L are also issued under sec. 133, 98 Stat. 
2230 (42 U.S.C. 10153) and sec. 218(a), 96 Stat. 2252 (42 U.S.C. 
10198).

    2. In Sec. 72.2, paragraph (b) is revised to read as follows:


Sec. 72.2  Scope.

* * * * *
    (b) The regulations in this part pertaining to an independent spent 
fuel storage installation (ISFSI) and a spent fuel storage cask apply 
to all persons in the United States, including persons in Agreement 
States. The regulations in this part pertaining to a monitored 
retrievable storage installation (MRS) apply only to DOE.
* * * * *
    3. In Sec. 72.3, the definitions of Certificate holder, Certificate 
of Compliance or CoC, and Spent fuel storage cask or cask are added in 
alphabetical order, and the definitions of Design bases, Design 
capacity, and Structures, systems, and components important to safety 
are revised to read as follows:


Sec. 72.3  Definitions.

* * * * *
    Certificate holder means a person who has been issued a Certificate 
of Compliance by the Commission for a spent fuel storage cask design.
    Certificate of Compliance or CoC means the certificate issued by 
the Commission that approves the design of a spent fuel storage cask in 
accordance with the provisions of subpart L of this part.
* * * * * * *
    Design bases means that information that identifies the specific 
functions to be performed by a structure, system, or component of a 
facility or of a spent fuel storage cask and the specific values or

[[Page 56122]]

ranges of values chosen for controlling parameters as reference bounds 
for design. These values may be restraints derived from generally 
accepted state-of-the-art practices for achieving functional goals or 
requirements derived from analysis (based on calculation or 
experiments) of the effects of a postulated event under which a 
structure, system, or component must meet its functional goals. The 
values for controlling parameters for external events include--
    (1) Estimates of severe natural events to be used for deriving 
design bases that will be based on consideration of historical data on 
the associated parameters, physical data, or analysis of upper limits 
of the physical processes involved; and
    (2) Estimates of severe external man-induced events to be used for 
deriving design bases that will be based on analysis of human activity 
in the region, taking into account the site characteristics and the 
risks associated with the event.
    Design capacity means the quantity of spent fuel or high-level 
radioactive waste, the maximum burn up of the spent fuel in MWD/MTU, 
the terabequerel (curie) content of the waste, and the total heat 
generation in Watts (btu/hour) that the storage installation is 
designed to accommodate.
* * * * * * *
    Spent fuel storage cask or cask means all the components and 
systems associated with the container in which spent fuel or other 
radioactive materials associated with spent fuel are stored in an 
ISFSI.
* * * * * * *
    Structures, systems, and components important to safety means those 
features of the ISFSI, MRS, and spent fuel storage cask whose functions 
are--
    (1) To maintain the conditions required to store spent fuel or 
high-level radioactive waste safely;
    (2) To prevent damage to the spent fuel or the high-level 
radioactive waste container during handling and storage; or
    (3) To provide reasonable assurance that spent fuel or high-level 
radioactive waste can be received, handled, packaged, stored, and 
retrieved without undue risk to the health and safety of the public.
    4. Section 72.9 is revised to read as follows:


Sec. 72.9  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 of 1995 (44 U.S.C. 3501 et seq.). OMB has approved the 
information collection requirements contained in this part under 
control number 3150-0132.
    (b) The approved information collection requirements contained in 
this part appear in Secs. 72.7, 72.11, 72.16, 72.19, 72.22 through 
72.34, 72.42, 72.44, 72.48 through 72.56, 72.62, 72.70 through 72.82, 
72.90, 72.92, 72.94, 72.98, 72.100, 72.102, 72.104, 72.108, 72.120, 
72.126, 72.140 through 72.176, 72.180 through 72.186, 72.192, 72.206, 
72.212, 72.216, 72.218, 72.230, 72.232, 72.234, 72.236, 72.240, 72.242, 
72.244, and 72.248.
    5. In Sec. 72.10, the introductory text of paragraph (a), the 
introductory text of paragraph (c), and paragraphs (c)(1) and (e)(1) 
are revised to read as follows:


Sec. 72.10  Employee protection.

    (a) Discrimination by a Commission licensee, certificate holder, an 
applicant for a Commission license or a CoC, or a contractor or 
subcontractor of any of these, against an employee for engaging in 
certain protected activities, is prohibited. Discrimination includes 
discharge and other actions that relate to compensation, terms, 
conditions, or privileges of employment. The protected activities are 
established in section 211 of the Energy Reorganization Act of 1974, as 
amended, and in general are related to the administration or 
enforcement of a requirement imposed under the Atomic Energy Act or the 
Energy Reorganization Act.
* * * * * * *
    (c) A violation of paragraph (a), (e), or (f) of this section by a 
Commission licensee, certificate holder, applicant for a Commission 
license or a CoC, or a contractor or subcontractor of any of these may 
be grounds for:
    (1) Denial, revocation, or suspension of the license or the CoC.
* * * * *
    (e)(1) Each licensee, certificate holder, and applicant for a 
license or CoC must prominently post the revision of NRC Form 3, 
``Notice to Employees,'' referenced in 10 CFR 19.11(c). This form must 
be posted at locations sufficient to permit employees protected by this 
section to observe a copy on the way to or from their place of work. 
The premises must be posted not later than 30 days after an application 
is docketed and remain posted while the application is pending before 
the Commission, during the term of the license or CoC, and for 30 days 
following license or CoC termination.
* * * * *
    6. Section 72.11 is revised to read as follows:


Sec. 72.11  Completeness and accuracy of information.

    (a) Information provided to the Commission by a licensee, 
certificate holder, or an applicant for a license or CoC; or 
information required by statute or by the Commission's regulations, 
orders, license or CoC conditions, to be maintained by the licensee or 
certificate holder, must be complete and accurate in all material 
respects.
    (b) Each licensee, certificate holder, or applicant for a license 
or CoC must notify the Commission of information identified by the 
licensee, certificate holder, or applicant for a license or CoC as 
having, for the regulated activity, a significant implication for 
public health and safety or common defense and security. A licensee, 
certificate holder, or an applicant for a license or CoC violates this 
paragraph only if the licensee, certificate holder, or applicant for a 
license or CoC fails to notify the Commission of information that the 
licensee, certificate holder, or applicant for a license or CoC has 
identified as having a significant implication for public health and 
safety or common defense and security. Notification must be provided to 
the Administrator of the appropriate Regional Office within two working 
days of identifying the information. This requirement is not applicable 
to information which is already required to be provided to the 
Commission by other reporting or updating requirements.
    7. In Sec. 72.86, paragraph (b) is revised to read as follows:


Sec. 72.86  Criminal penalties.

* * * * *
    (b) The regulations in this part 72 that are not issued under 
sections 161b, 161i, or 161o for the purposes of section 223 are as 
follows: Secs. 72.1, 72.2, 72.3, 72.4, 72.5, 72.7, 72.8, 72.9, 72.16, 
72.18, 72.20, 72.22, 72.24, 72.26, 72.28, 72.32, 72.34, 72.40, 72.46, 
72.56, 72.58, 72.60, 72.62, 72.84, 72.86, 72.90, 72.96, 72.108, 72.120, 
72.122, 72.124, 72.126, 72.128, 72.130, 72.182, 72.194, 72.200, 72.202, 
72.204, 72.206, 72.210, 72.214, 72.220, 72.230, 72.238, 72.240, 72.244, 
and 72.246.
    8. Subpart G is revised to read as follows:

Subpart G--Quality Assurance

Sec.
72.140  Quality assurance requirements.
72.142  Quality assurance organization.
72.144  Quality assurance program.

[[Page 56123]]

72.146  Design control.
72.148  Procurement document control.
72.150  Instructions, procedures, and drawings.
72.152  Document control.
72.154  Control of purchased material, equipment, and services.
72.156  Identification and control of materials, parts, and 
components.
72.158  Control of special processes.
72.160  Licensee and certificate holder inspection.
72.162  Test control.
72.164  Control of measuring and test equipment.
72.166  Handling, storage, and shipping control.
72.168  Inspection, test, and operating status.
72.170  Nonconforming materials, parts, or components.
72.172  Corrective action.
72.174  Quality assurance records.
72.176  Audits.

Subpart G--Quality Assurance


Sec. 72.140  Quality assurance requirements.

    (a) Purpose. This subpart describes quality assurance requirements 
that apply to design, purchase, fabrication, handling, shipping, 
storing, cleaning, assembly, inspection, testing, operation, 
maintenance, repair, modification of structures, systems, and 
components, and decommissioning that are important to safety. As used 
in this subpart, ``quality assurance'' comprises all those planned and 
systematic actions necessary to provide adequate confidence that a 
structure, system, or component will perform satisfactorily in service. 
Quality assurance includes quality control, which comprises those 
quality assurance actions related to control of the physical 
characteristics and quality of the material or component to 
predetermined requirements. The certificate holder and applicant for a 
CoC are responsible for the quality assurance requirements as they 
apply to the design, fabrication, and testing of a spent fuel storage 
cask until possession of the spent fuel storage cask is transferred to 
the licensee. The licensee and the certificate holder are also 
simultaneously responsible for these quality assurance requirements 
through the oversight of contractors and subcontractors.
    (b) Establishment of program. Each licensee, applicant for a 
license, certificate holder, applicant for a CoC shall establish, 
maintain, and execute a quality assurance program satisfying each of 
the applicable criteria of this subpart, and satisfying any specific 
provisions which are applicable to the licensee's, applicant's for a 
license, certificate holder's, and applicant's for a CoC activities. 
The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall execute the applicable criteria in a graded 
approach to an extent that is commensurate with the quality assurance 
requirements' importance to safety. The quality assurance program must 
cover the activities identified in this subpart throughout the life of 
the activity. For licensees, this includes activities from the site 
selection through decommissioning prior to termination of the license. 
For certificate holders, this includes activities from development of 
the spent fuel storage cask design through termination of the CoC.
    (c) Approval of program. (1) Each licensee, applicant for a 
license, certificate holder, and applicant for a CoC shall file a 
description, in accordance with Sec. 72.4, of its quality assurance 
program that includes a discussion of which requirements of this 
subpart are applicable and the methodology used to satisfy these 
requirements.
    (2) Each licensee shall obtain Commission approval of its quality 
assurance program prior to receipt of spent fuel at the ISFSI or spent 
fuel and high-level radioactive waste at the MRS.
    (3) Each certificate holder shall obtain Commission approval of its 
quality assurance program prior to commencing fabrication or testing of 
a spent fuel storage cask.
    (d) Previously approved programs. A quality assurance program 
previously approved by the Commission and which is established, 
maintained, and executed with regard to an ISFSI or spent fuel storage 
cask will be accepted as satisfying the requirements of paragraph (b) 
of this section. Previously approved quality assurance programs that 
satisfy the requirements of Appendix B to part 50 of this chapter, 
subpart H of part 71 of this chapter, or subpart G of this part are 
considered acceptable, except each licensee, applicant for a license, 
certificate holder, and applicant for a CoC who are using an Appendix B 
or subpart H quality assurance program shall also meet the 
recordkeeping requirements of Sec. 72.174. Prior to initial use of a 
previously approved program, each licensee, applicant for a license, 
certificate holder, and applicant for a CoC shall notify the NRC, in 
accordance with Sec. 72.4, of its intent to apply its previously 
approved quality assurance program to ISFSI or spent fuel storage cask 
activities. The notification must identify the quality assurance 
program by date of submittal to the Commission, docket number, and date 
of Commission approval.


Sec. 72.142  Quality assurance organization.

    (a) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall be responsible for the establishment and 
execution of the quality assurance program. The licensee and 
certificate holder may delegate to others, such as contractors, agents, 
or consultants, the work of establishing and executing the quality 
assurance program, but the licensee and the certificate holder shall 
retain responsibility for the program. The licensee, applicant for a 
license, certificate holder, and applicant for a CoC shall clearly 
establish and delineate in writing the authority and duties of persons 
and organizations performing activities affecting the functions of 
structures, systems, and components which are important to safety. 
These activities include performing the functions associated with 
attaining quality objectives and the quality assurance functions.
    (b) The quality assurance functions are--
    (1) Assuring that an appropriate quality assurance program is 
established and effectively executed; and
    (2) Verifying, by procedures such as checking, auditing, and 
inspection, that activities affecting the functions that are important 
to safety have been correctly performed. The persons and organizations 
performing quality assurance functions shall have sufficient authority 
and organizational freedom to identify quality problems; to initiate, 
recommend, or provide solutions; and to verify implementation of 
solutions.
    (c) The persons and organizations performing quality assurance 
functions shall report to a management level that ensures that the 
required authority and organizational freedom, including sufficient 
independence from cost and schedule considerations when these 
considerations are opposed to safety considerations, are provided. 
Because of the many variables involved, such as the number of 
personnel, the type of activity being performed, and the location or 
locations where activities are performed, the organizational structure 
for executing the quality assurance program may take various forms, 
provided that the persons and organizations assigned the quality 
assurance functions have the required authority and organizational 
freedom. Irrespective of the organizational structure, the 
individual(s) assigned the responsibility for assuring effective 
execution of any portion of the quality assurance program, at any 
location where activities subject to this section are being performed, 
must have direct

[[Page 56124]]

access to the levels of management necessary to perform this function.


Sec. 72.144  Quality assurance program.

    (a) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish, at the earliest practicable time 
consistent with the schedule for accomplishing the activities, a 
quality assurance program which complies with the requirements of this 
subpart. The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall document the quality assurance program by 
written procedures or instructions and shall carry out the program in 
accordance with these procedures throughout the period during which the 
ISFSI or MRS is licensed or the spent fuel storage cask is certified. 
The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall identify the structures, systems, and 
components to be covered by the quality assurance program, the major 
organizations participating in the program, and the designated 
functions of these organizations.
    (b) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC, through their quality assurance program(s), shall 
provide control over activities affecting the quality of the identified 
structures, systems, and components to an extent commensurate with the 
importance to safety and, as necessary, to ensure conformance with the 
approved design of each ISFSI, MRS, or spent fuel storage cask. The 
licensee, applicant for a license, certificate holder, and applicant 
for a CoC shall ensure that activities affecting quality are 
accomplished under suitably controlled conditions. Controlled 
conditions include the use of appropriate equipment; suitable 
environmental conditions for accomplishing the activity, such as 
adequate cleanliness; and assurance that all prerequisites for the 
given activity have been satisfied. The licensee, applicant for a 
license, certificate holder, and applicant for a CoC shall take into 
account the need for special controls, processes, test equipment, tools 
and skills to attain the required quality and the need for verification 
of quality by inspection and test.
    (c) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall base the requirements and procedures of their 
quality assurance program(s) on the following considerations concerning 
the complexity and proposed use of the structures, systems, or 
components:
    (1) The impact of malfunction or failure of the item on safety;
    (2) The design and fabrication complexity or uniqueness of the 
item;
    (3) The need for special controls and surveillance over processes 
and equipment;
    (4) The degree to which functional compliance can be demonstrated 
by inspection or test; and
    (5) The quality history and degree of standardization of the item.
    (d) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall provide for indoctrination and training of 
personnel performing activities affecting quality as necessary to 
ensure that suitable proficiency is achieved and maintained.
    (e) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall review the status and adequacy of the quality 
assurance program at established intervals. Management of other 
organizations participating in the quality assurance program must 
regularly review the status and adequacy of that part of the quality 
assurance program which they are executing.


Sec. 72.146  Design control.

    (a) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to ensure that applicable 
regulatory requirements and the design basis, as specified in the 
license or CoC application for those structures, systems, and 
components to which this section applies, are correctly translated into 
specifications, drawings, procedures, and instructions. These measures 
must include provisions to ensure that appropriate quality standards 
are specified and included in design documents and that deviations from 
standards are controlled. Measures must be established for the 
selection and review for suitability of application of materials, 
parts, equipment, and processes that are essential to the functions of 
the structures, systems, and components which are important to safety.
    (b) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures for the identification and 
control of design interfaces and for coordination among participating 
design organizations. These measures must include the establishment of 
written procedures among participating design organizations for the 
review, approval, release, distribution, and revision of documents 
involving design interfaces. The design control measures must provide 
for verifying or checking the adequacy of design by methods such as 
design reviews, alternate or simplified calculational methods, or by a 
suitable testing program. For the verifying or checking process, the 
licensee and certificate holder shall designate individuals or groups 
other than those who were responsible for the original design, but who 
may be from the same organization. Where a test program is used to 
verify the adequacy of a specific design feature in lieu of other 
verifying or checking processes, the licensee and certificate holder 
shall include suitable qualification testing of a prototype or sample 
unit under the most adverse design conditions. The licensee, applicant 
for a license, certificate holder, and applicant for a CoC shall apply 
design control measures to items such as the following: criticality 
physics, radiation, shielding, stress, thermal, hydraulic, and accident 
analyses; compatibility of materials; accessibility for inservice 
inspection, maintenance, and repair; features to facilitate 
decontamination; and delineation of acceptance criteria for inspections 
and tests.
    (c) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall subject design changes, including field 
changes, to design control measures commensurate with those applied to 
the original design. Changes in the conditions specified in the license 
or CoC require prior NRC approval.


Sec. 72.148  Procurement document control.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to assure that applicable 
regulatory requirements, design bases, and other requirements which are 
necessary to assure adequate quality are included or referenced in the 
documents for procurement of material, equipment, and services, whether 
purchased by the licensee, certificate holder, or by their contractors 
and subcontractors. To the extent necessary, the licensee, applicant 
for a license, certificate holder, and applicant for a CoC, shall 
require contractors or subcontractors to provide a quality assurance 
program consistent with the applicable provisions of this subpart.


Sec. 72.150  Instructions, procedures, and drawings.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall prescribe activities affecting quality by 
documented instructions, procedures, or drawings of a type appropriate 
to the circumstances and shall require that these instructions, 
procedures, and drawings be followed. The instructions, procedures, and 
drawings must include appropriate

[[Page 56125]]

quantitative or qualitative acceptance criteria for determining that 
important activities have been satisfactorily accomplished.


Sec. 72.152  Document control.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to control the issuance of 
documents such as instructions, procedures, and drawings, including 
changes, which prescribe all activities affecting quality. These 
measures must assure that documents, including changes, are reviewed 
for adequacy, approved for release by authorized personnel, and 
distributed and used at the location where the prescribed activity is 
performed. These measures must ensure that changes to documents are 
reviewed and approved.


Sec. 72.154  Control of purchased material, equipment, and services.

    (a) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to ensure that purchased 
material, equipment, and services, whether purchased directly or 
through contractors and subcontractors, conform to the procurement 
documents. These measures must include provisions, as appropriate, for 
source evaluation and selection, objective evidence of quality 
furnished by the contractor or subcontractor, inspection at the 
contractor or subcontractor source, and examination of products upon 
delivery.
    (b) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall have available documentary evidence that 
material and equipment conform to the procurement specifications prior 
to installation or use of the material and equipment. The licensee and 
certificate holder shall retain or have available this documentary 
evidence for the life of the ISFSI, MRS, or spent fuel storage cask. 
The licensee and certificate holder shall ensure that the evidence is 
sufficient to identify the specific requirements met by the purchased 
material and equipment.
    (c) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC, or a designee of either, shall assess the 
effectiveness of the control of quality by contractors and 
subcontractors at intervals consistent with the importance, complexity, 
and quantity of the product or services.


Sec. 72.156  Identification and control of materials, parts, and 
components.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures for the identification and 
control of materials, parts, and components. These measures must ensure 
that identification of the item is maintained by heat number, part 
number, serial number, or other appropriate means, either on the item 
or on records traceable to the item as required, throughout 
fabrication, installation, and use of the item. These identification 
and control measures must be designed to prevent the use of incorrect 
or defective materials, parts, and components.


Sec. 72.158  Control of special processes.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to ensure that special 
processes, including welding, heat treating, and nondestructive 
testing, are controlled and accomplished by qualified personnel using 
qualified procedures in accordance with applicable codes, standards, 
specifications, criteria, and other special requirements.


Sec. 72.160  Licensee and certificate holder inspection.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish and execute a program for 
inspection of activities affecting quality by or for the organization 
performing the activity to verify conformance with the documented 
instructions, procedures, and drawings for accomplishing the activity. 
The inspection must be performed by individuals other than those who 
performed the activity being inspected. Examinations, measurements, or 
tests of material or products processed must be performed for each work 
operation where necessary to assure quality. If direct inspection of 
processed material or products cannot be carried out, indirect control 
by monitoring processing methods, equipment, and personnel must be 
provided. Both inspection and process monitoring must be provided when 
quality control is inadequate without both. If mandatory inspection 
hold points that require witnessing or inspecting by the licensee's or 
certificate holder's designated representative, and beyond which work 
should not proceed without the consent of its designated 
representative, are required, the specific hold points must be 
indicated in appropriate documents.


Sec. 72.162  Test control.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish a test program to ensure that all 
testing, required to demonstrate that the structures, systems, and 
components will perform satisfactorily in service, is identified and 
performed in accordance with written test procedures that incorporate 
the requirements of this part and the requirements and acceptance 
limits contained in the ISFSI, MRS, or spent fuel storage cask license 
or CoC. The test procedures must include provisions to ensure that all 
prerequisites for the given test are met, that adequate test 
instrumentation is available and used, and that the test is performed 
under suitable environmental conditions. The licensee, applicant for a 
license, certificate holder, and applicant for a CoC shall document and 
evaluate the test results to ensure that test requirements have been 
satisfied.


Sec. 72.164  Control of measuring and test equipment.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to ensure that tools, 
gauges, instruments, and other measuring and testing devices used in 
activities affecting quality are properly controlled, calibrated, and 
adjusted at specified periods to maintain accuracy within necessary 
limits.


Sec. 72.166  Handling, storage, and shipping control.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to control, in accordance 
with work and inspection instructions, the handling, storage, shipping, 
cleaning, and preservation of materials and equipment to prevent damage 
or deterioration. When necessary for particular products, special 
protective environments, such as inert gas atmosphere, and specific 
moisture content and temperature levels must be specified and provided.


Sec. 72.168  Inspection, test, and operating status.

    (a) The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to indicate, by the use of 
markings such as stamps, tags, labels, routing cards, or other suitable 
means, the status of inspections and tests performed upon individual 
items of the ISFSI, MRS, or spent fuel storage cask. These measures 
must provide for the identification of items which have satisfactorily 
passed required inspections and tests where necessary to preclude 
inadvertent bypassing of the inspections and tests.
    (b) The licensee shall establish measures to identify the operating 
status of structures, systems, and components of the ISFSI or MRS, such 
as tagging

[[Page 56126]]

valves and switches, to prevent inadvertent operation.


Sec. 72.170  Nonconforming materials, parts, or components.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to control materials, 
parts, or components that do not conform to their requirements in order 
to prevent their inadvertent use or installation. These measures must 
include, as appropriate, procedures for identification, documentation, 
segregation, disposition, and notification to affected organizations. 
Nonconforming items must be reviewed and accepted, rejected, repaired, 
or reworked in accordance with documented procedures.


Sec. 72.172  Corrective action.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall establish measures to ensure that conditions 
adverse to quality, such as failures, malfunctions, deficiencies, 
deviations, defective material and equipment, and nonconformances, are 
promptly identified and corrected. In the case of a significant 
condition identified as adverse to quality, the measures must ensure 
that the cause of the condition is determined and corrective action is 
taken to preclude repetition. The identification of the significant 
condition adverse to quality, the cause of the condition, and the 
corrective action taken must be documented and reported to appropriate 
levels of management.


Sec. 72.174  Quality assurance records.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall maintain sufficient records to furnish 
evidence of activities affecting quality. The records must include the 
following: design records, records of use, and the results of reviews, 
inspections, tests, audits, monitoring of work performance, and 
materials analyses. The records must include closely related data such 
as qualifications of personnel, procedures, and equipment. Inspection 
and test records must, at a minimum, identify the inspector or data 
recorder, the type of observation, the results, the acceptability, and 
the action taken in connection with any noted deficiencies. Records 
must be identifiable and retrievable. Records pertaining to the design, 
fabrication, erection, testing, maintenance, and use of structures, 
systems, and components important to safety must be maintained by or 
under the control of the licensee or certificate holder until the NRC 
terminates the license or CoC.


Sec. 72.176  Audits.

    The licensee, applicant for a license, certificate holder, and 
applicant for a CoC shall carry out a comprehensive system of planned 
and periodic audits to verify compliance with all aspects of the 
quality assurance program and to determine the effectiveness of the 
program. The audits must be performed in accordance with written 
procedures or checklists by appropriately trained personnel not having 
direct responsibilities in the areas being audited. Audited results 
must be documented and reviewed by management having responsibility in 
the area audited. Follow-up action, including reaudit of deficient 
areas, must be taken where indicated.
    9. Section 72.232 is revised to read as follows:


Sec. 72.232  Inspection and tests.

    (a) The certificate holder and applicant for a CoC shall permit, 
and make provisions for, the NRC to inspect the premises and facilities 
where a spent fuel storage cask is designed, fabricated, and tested.
    (b) The certificate holder and applicant for a CoC shall make 
available to the NRC for inspection, upon reasonable notice, records 
kept by them pertaining to the design, fabrication, and testing of 
spent fuel storage casks.
    (c) The certificate holder and applicant for a CoC shall perform, 
and make provisions that permit the NRC to perform, tests that the 
Commission deems necessary or appropriate for the administration of the 
regulations in this part.
    (d) The certificate holder and applicant for a CoC shall submit a 
notification under Sec. 72.4 at least 45 days prior to starting 
fabrication of the first spent fuel storage cask under a Certificate of 
Compliance.
    10. Section 72.234 is revised to read as follows:


Sec. 72.234  Conditions of approval.

    (a) The certificate holder and applicant for a CoC shall ensure 
that the design, fabrication, testing, and maintenance of a spent fuel 
storage cask comply with the requirements in Sec. 72.236.
    (b) The certificate holder and applicant for a CoC shall ensure 
that the design, fabrication, testing, and maintenance of spent fuel 
storage casks are conducted under a quality assurance program that 
meets the requirements of subpart G of this part.
    (c) The certificate holder and applicant for a CoC shall ensure 
that the fabrication of spent fuel storage casks under a CoC does not 
begin prior to receipt of the CoC for the spent fuel storage cask.
    (d)(1) The certificate holder shall ensure that a record is 
established and maintained for each spent fuel storage cask fabricated 
under the CoC.
    (2) This record must include:
    (i) The NRC CoC number;
    (ii) The spent fuel storage cask model number;
    (iii) The spent fuel storage cask identification number;
    (iv) Date fabrication was started;
    (v) Date fabrication was completed;
    (vi) Certification that the spent fuel storage cask was designed, 
fabricated, tested, and repaired in accordance with a quality assurance 
program accepted by NRC;
    (vii) Certification that inspections required by Sec. 72.236(j) 
were performed and found satisfactory; and
    (viii) The name and address of the licensee using the spent fuel 
storage cask.
    (3) The certificate holder shall supply the original of this record 
to the licensees using the spent fuel storage cask. A current copy of a 
composite record of all spent fuel storage casks manufactured under a 
CoC, showing the information in paragraph (d)(2) of this section, must 
be initiated and maintained by the certificate holder for each model 
spent fuel storage cask. If the certificate holder permanently ceases 
production of spent fuel storage casks under a CoC, the certificate 
holder shall send this composite record to the Commission using 
instructions in Sec. 72.4.
    (e) The certificate holder and the licensees using the spent fuel 
storage cask shall ensure that the composite record required by 
paragraph (d) of this section is available to the Commission for 
inspection.
    (f) The certificate holder shall ensure that written procedures and 
appropriate tests are established prior to use of the spent fuel 
storage casks. A copy of these procedures and tests must be provided to 
each licensee using the spent fuel storage cask.
    11. Section 72.236 is revised to read as follows:


Sec. 72.236  Specific requirements for spent fuel storage cask approval 
and fabrication.

    The certificate holder shall ensure that the requirements of this 
section are met. An applicant for a CoC shall ensure that the 
requirements of this section are met, except for paragraphs (j) and (k) 
of this section.
    (a) Specifications must be provided for the spent fuel to be stored 
in the

[[Page 56127]]

spent fuel storage cask, such as, but not limited to, type of spent 
fuel (i.e., BWR, PWR, both), maximum allowable enrichment of the fuel 
prior to any irradiation, burn-up (i.e., megawatt-days/MTU), minimum 
acceptable cooling time of the spent fuel prior to storage in the spent 
fuel storage cask, maximum heat designed to be dissipated, maximum 
spent fuel loading limit, condition of the spent fuel (i.e., intact 
assembly or consolidated fuel rods), the inerting atmosphere 
requirements.
    (b) Design bases and design criteria must be provided for 
structures, systems, and components important to safety.
    (c) The spent fuel storage cask must be designed and fabricated so 
that the spent fuel is maintained in a subcritical condition under 
credible conditions.
    (d) Radiation shielding and confinement features must be provided 
sufficient to meet the requirements in Secs. 72.104 and 72.106.
    (e) The spent fuel storage cask must be designed to provide 
redundant sealing of confinement systems.
    (f) The spent fuel storage cask must be designed to provide 
adequate heat removal capacity without active cooling systems.
    (g) The spent fuel storage cask must be designed to store the spent 
fuel safely for a minimum of 20 years and permit maintenance as 
required.
    (h) The spent fuel storage cask must be compatible with wet or dry 
spent fuel loading and unloading facilities.
    (i) The spent fuel storage cask must be designed to facilitate 
decontamination to the extent practicable.
    (j) The spent fuel storage cask must be inspected to ascertain that 
there are no cracks, pinholes, uncontrolled voids, or other defects 
that could significantly reduce its confinement effectiveness.
    (k) The spent fuel storage cask must be conspicuously and durably 
marked with--
    (1) A model number;
    (2) A unique identification number; and
    (3) An empty weight.
    (l) The spent fuel storage cask and its systems important to safety 
must be evaluated, by appropriate tests or by other means acceptable to 
the NRC, to demonstrate that they will reasonably maintain confinement 
of radioactive material under normal, off-normal, and credible accident 
conditions.
    (m) To the extent practicable in the design of spent fuel storage 
casks, consideration should be given to compatibility with removal of 
the stored spent fuel from a reactor site, transportation, and ultimate 
disposition by the Department of Energy.
    12. Section 72.240 is revised to read as follows:


Sec. 72.240  Conditions for spent fuel storage cask reapproval.

    (a) The certificate holder, a licensee using a spent fuel storage 
cask, or the representative of a licensee using a spent fuel storage 
cask shall apply for reapproval of the design of a spent fuel storage 
cask.
    (b) The application for reapproval of the design of a spent fuel 
storage cask must be submitted not less than 30 days prior to the 
expiration date of the CoC. When the applicant has submitted a timely 
application for reapproval, the existing CoC will not expire until the 
application for reapproval has been determined by the NRC. The 
application must be accompanied by a safety analysis report (SAR). The 
new SAR may reference the SAR originally submitted for the approved 
spent fuel storage cask design.
    (c) The design of a spent fuel storage cask will be reapproved if 
the conditions in Sec. 72.238 are met, and the application includes a 
demonstration that the storage of spent fuel has not significantly 
adversely affected structures, systems, and components important to 
safety.
    13. Section 72.242 is added to read as follows:


Sec. 72.242  Recordkeeping and reports.

    (a) Each certificate holder or applicant shall maintain any records 
and produce any reports that may be required by the conditions of the 
CoC or by the rules, regulations, and orders of the NRC in effectuating 
the purposes of the Act.
    (b) Records that are required by the regulations in this part or by 
conditions of the CoC must be maintained for the period specified by 
the appropriate regulation or the CoC conditions. If a retention period 
is not specified, the records must be maintained until the NRC 
terminates the CoC.
    (c) Any record maintained under this part may be either the 
original or a reproduced copy by any state-of-the-art method provided 
that any reproduced copy is duly authenticated by authorized personnel 
and is capable of producing a clear and legible copy after storage for 
the period specified by NRC regulations.
    (d) Each certificate holder shall submit a written report to the 
NRC within 30 days of discovery of a design or fabrication deficiency, 
for any spent fuel storage cask which has been delivered to a licensee, 
when the design or fabrication deficiency affects the ability of 
structures, systems, and components important to safety to perform 
their intended safety function. The written report shall be sent to the 
NRC in accordance with the requirements of Sec. 72.4. The report shall 
include the following:
    (1) A brief abstract describing the deficiency, including all 
component or system failures that contributed to the deficiency and 
corrective action taken or planned to prevent recurrence;
    (2) A clear, specific, narrative description of what occurred so 
that knowledgeable readers familiar with the design of the spent fuel 
storage cask, but not familiar with the details of a particular cask, 
can understand the deficiency. The narrative description shall include 
the following specific information as appropriate for the particular 
event:
    (i) Dates and approximate times of discovery;
    (ii) The cause of each component or system failure, if known;
    (iii) The failure mode, mechanism, and effect of each failed 
component, if known;
    (iv) A list of systems or secondary functions that were also 
affected for failures of components with multiple functions;
    (v) The method of discovery of each component or system failure;
    (vi) The manufacturer and model number (or other identification) of 
each component that failed during the event;
    (vii) The model and serial numbers of the affected spent fuel 
storage casks; (viii) The licensees that have affected spent fuel 
storage casks;
    (3) An assessment of the safety consequences and implications of 
the deficiency. This assessment shall include the availability of other 
systems or components that could have performed the same function as 
the components and systems that were affected;
    (4) A description of any corrective actions planned as a result of 
the deficiency, including those to reduce the probability of similar 
occurrences in the future;
    (5) Reference to any previous similar deficiencies at the same 
facility that are known to the certificate holder; and
    (6) The name and telephone number of a person within the 
certificate holder's organization who is knowledgeable about the 
deficiency and can provide additional information.

    Dated at Rockville, Maryland, this 5th day of October, 1999.


[[Page 56128]]


    For the Nuclear Regulatory Commission.
Andrew L. Bates,
Acting Secretary of the Commission.
[FR Doc. 99-26700 Filed 10-14-99; 8:45 am]
BILLING CODE 7590-01-P