[Federal Register Volume 70, Number 139 (Thursday, July 21, 2005)]
[Rules and Regulations]
[Pages 41937-41939]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14208]



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  Federal Register / Vol. 70, No. 139 / Thursday, July 21, 2005 / Rules 
and Regulations  

[[Page 41937]]



NUCLEAR REGULATORY COMMISSION

10 CFR Part 110

RIN 3150-AH51


Export and Import of Nuclear Equipment and Material: Nuclear 
Grade Graphite

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Nuclear Regulatory Commission (NRC) export/import 
regulations in 10 CFR part 110 are being revised to remove the NRC's 
export licensing requirements for nuclear grade graphite for non-
nuclear end use. The purpose of this change is to remove from NRC 
export licensing jurisdiction nuclear materials which are not of 
significance from a nuclear proliferation perspective. The 
responsibility for the licensing of exports of nuclear grade graphite 
for non-nuclear end use will be transferred to the Department of 
Commerce (DOC). The DOC is publishing elsewhere in this Federal 
Register a final rule that places such exports under its jurisdiction.

DATES: Effective July 21, 2005.

ADDRESSES: Publicly available documents related to this rulemaking may 
be viewed electronically on the public computers located at the NRC's 
Public Document Room (PDR), Room O1F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland. The PDR reproduction contractor 
will copy documents for a fee. Selected documents can be viewed and 
downloaded electronically via the NRC's rulemaking Web site at http://ruleforum.llnl.gov.
    Publicly available documents created or received at the NRC are 
available electronically at the NRC's Electronic Reading Room at http://www.nrc.gov/NRC/reading-rm/adams.html. From this site, the public can 
gain entry into the NRC's Agencywide Document Access and Management 
System (ADAMS), which provides text and image files of NRC's public 
documents. If you do not have access to ADAMS or if there are problems 
in accessing the documents located in ADAMS, contact the NRC Public 
Document Room (PDR) Reference staff at (800) 397-4209, (301) 415-4737, 
or by e-mail to [email protected].

FOR FURTHER INFORMATION CONTACT: Suzanne Schuyler-Hayes, Office of 
International Programs, U.S. Nuclear Regulatory Commission, Washington, 
DC 20555-0001, telephone (301) 415-2333, e-mail [email protected].

SUPPLEMENTARY INFORMATION:

Background

    The purpose of this rule is to update NRC's regulations in 10 CFR 
part 110 governing the export of nuclear grade graphite. Neither the 
Atomic Energy Act (AEA) nor the Nuclear Non-proliferation Act (NNPA) 
explicitly requires that the export of nuclear grade graphite be 
controlled by the NRC. The Commission has controlled the export of 
nuclear grade graphite pursuant to Section 109b. of the AEA, due to its 
prior determination that nuclear grade graphite is an ``item or 
substance'' that is ``especially relevant from the standpoint of export 
control because of [its] significance for nuclear explosive purposes.'' 
As a result of technological advancements in the production of 
graphite, virtually all graphite produced today can be considered 
``nuclear grade.'' The NRC's licensing experience has been that most 
nuclear grade graphite is exported only for non-nuclear end use in the 
manufacture of commercial and industrial items.
    Other supplier nations have export controls over nuclear grade 
graphite but have limited them to cover exports ``for use in a nuclear 
reactor.'' This limitation appears in both the Nuclear Non-
Proliferation Treaty Exporters Committee (Zangger Committee) and the 
Nuclear Suppliers Group (NSG) definitions of controlled items. See, 
e.g., International Atomic Energy Agency INFCIRC/209 and 254 
respectively.
    The NRC has determined, after consultation with the Executive 
Branch, that nuclear grade graphite for non-nuclear end use is not an 
``item or substance'' that is ``especially relevant from the standpoint 
of export control because of [its] significance for nuclear explosive 
purposes.'' See Section 109b. of the AEA.\1\ The Executive Branch, 
including the Departments of State, Energy, Defense, and Commerce, 
concurs in the NRC's determination. The history of the use of nuclear 
grade graphite exported under the Commission's authority indicates that 
graphite has not been diverted for illicit purposes to produce weapons-
grade material or for use in unsafeguarded nuclear activities. To the 
extent that any risk of diversion may exist, exports of nuclear grade 
graphite for non-nuclear end use will continue to be controlled by the 
DOC. Thus, any effort to divert exported material for illicit purposes 
would likely be discovered by the cognizant national authority or the 
international community.
    Accordingly, the Commission has concluded, with the concurrence of 
the Executive Branch, that U.S. regulatory and commercial interests 
will be best served by the DOC assuming export control over all nuclear 
grade graphite for non-nuclear end use. The DOC is publishing 
regulations establishing licensing controls over this class of 
material.
---------------------------------------------------------------------------

    \1\ The NRC has not, however, made the same finding under the 
Section 109b. of the AEA with respect to exports of nuclear grade 
graphite for nuclear end use, which the NRC will continue to 
regulate as a material ``especially relevant for export control 
because of [its] significance for nuclear explosive purposes.''
---------------------------------------------------------------------------

    This final rule limits NRC's jurisdiction over exports of nuclear 
grade graphite to nuclear end use. The definition of ``nuclear grade 
graphite'' in 10 CFR 110.2 is being replaced with a definition of 
``nuclear grade graphite for nuclear end use.'' Nuclear grade graphite 
for nuclear end use is being defined in Sec.  110.2 as ``graphite 
having a purity level of better than (i.e., less than) 5 parts per 
million boron equivalent * * * and intended for use in a nuclear 
reactor.'' This definition is consistent with the definition in the 
Zangger Committee and NSG Part 1 Trigger Lists. The density requirement 
of 1.5 grams per cubic centimeter in the current definition of nuclear 
grade graphite is being removed. Graphite powder at any density level 
for nuclear end use, including the coating of fuel spheres in pebble 
bed reactor applications, is being captured under NRC jurisdiction. The 
general license for the export of nuclear grade graphite for nuclear 
end use in

[[Page 41938]]

Sec.  110.25 is being revoked. All exports of nuclear grade graphite 
for nuclear end use will now require a specific license from the NRC, 
including Commission and Executive Branch review (see Sec. Sec.  110.40 
and 41), and will be noticed in the Federal Register (see Sec.  
110.70). Finally, all NRC license provisions for non-nuclear end use 
exports of nuclear grade graphite are being removed. A note is being 
added which states that the export of nuclear grade graphite for non-
nuclear end use is regulated by the DOC.
    This final rule eliminates the NRC licensing burden on exporters 
for nuclear grade graphite exported purely for non-nuclear end use 
which, under current industry trends, constitutes the majority of 
nuclear grade graphite being exported. Removing exports of nuclear 
grade graphite for non-nuclear end use from 10 CFR part 110 will also 
reduce the burden under the Paperwork Reduction Act for licensees 
exporting nuclear grade graphite for non-nuclear end use.
    The NRC has determined that this rule will pose no unreasonable 
risk to the public health and safety or the common defense and 
security.

Administrative Procedure Act

    The provisions of the Administrative Procedure Act under 5 U.S.C. 
553 requiring notice of proposed rulemaking, the opportunity for public 
participation, and a 30-day delay in effective date are inapplicable 
because this rule involves a military and foreign affairs function of 
the United States (5 U.S.C. 553(a)(1)). Accordingly, this final rule is 
effective immediately upon publication in the Federal Register.

Voluntary Consensus Standards

    The National Technology Transfer and Advancement Act of 1995, Pub. 
L. 104-113, requires that Federal agencies use technical standards that 
are developed or adopted by voluntary consensus standards bodies unless 
using such a standard is inconsistent with applicable law or otherwise 
impractical. This final rule does not constitute the establishment of a 
standard for which the use of a voluntary consensus standard would be 
applicable.

Environmental Impact: Categorical Exclusion

    The NRC has determined that this final rule is the type of action 
described in categorical exclusion 10 CFR 51.22(c)(1). Therefore, 
neither an environmental impact statement nor an environmental 
assessment has been prepared for the regulation.

Paperwork Reduction Act Statement

    This final rule eliminates the burden on licensees for 
recordkeeping and reporting requirements to obtain a license for the 
export of nuclear grade graphite for non-nuclear end use and maintain 
associated records under 10 CFR part 110. The public burden for 
information collection and recordkeeping requirements to export nuclear 
grade graphite for non-nuclear end use is estimated to average 3.6 
hours per licensee. Because the burden for this information collection 
is insignificant, Office of Management and Budget (OMB) clearance is 
not required. Existing requirements were approved by OMB, approval 
numbers 3150-0027 and 3150-0036.

Public Protection Notification

    The NRC may not conduct or sponsor, and a person is not required to 
respond to, a request for information or an information collection 
requirement unless the requesting document displays a currently valid 
OMB control number.

Regulatory Analysis

    The NRC has sole control of the export of nuclear grade graphite 
for nuclear applications. There is no other alternative to amending the 
regulations at 10 CFR part 110 to reflect changing circumstances. The 
final rule will reduce the burden on licensees and the cost to the 
public without posing an unreasonable risk to the public health and 
safety or to the common defense and security.

Regulatory Flexibility Certification

    As required by the Regulatory Flexibility Act of 1980, 5 U.S.C. 
605(b), the Commission certifies that this final rule does not have a 
significant economic impact on a substantial number of small entities. 
This rule eliminates NRC license requirements for the export of nuclear 
grade graphite for non-nuclear end use. The companies which export 
nuclear grade graphite do not fall within the scope of the definition 
of ``small entities'' set forth in the Regulatory Flexibility Act (5 
U.S.C. 601(3)), or the Size Standards established by the NRC (10 CFR 
2.810).

Backfit Analysis

    The NRC has determined that a backfit analysis is not required for 
this final rule because these amendments do not include any provisions 
that would impose backfits as defined in 10 CFR Chapter I.

Small Business Regulatory Enforcement Fairness Act

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

List of Subjects in 10 CFR Part 110

    Administrative practice and procedure, Classified information, 
Criminal penalties, Export, Import, Intergovernmental relations, 
Nuclear materials, Nuclear power plants and reactors, Reporting and 
recordkeeping requirements, Scientific equipment.


0
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 110.

PART 110--EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATERIAL

0
1. The authority citation for part 110 continues to read as follows:

    Authority: Secs. 51, 53, 54, 57, 63, 64, 65, 81, 82, 103, 104, 
109, 111, 126, 127, 128, 129, 161, 181, 182, 183, 187, 189, 68 Stat. 
929, 930, 931, 932, 933, 936, 937, 948, 953, 954, 955, 956, as 
amended (42 U.S.C. 2071, 2073, 2074, 2077, 2092-2095, 2111, 2112, 
2133, 2134, 2139, 2139a, 2141, 2154-2158, 2201, 2231-2233, 2237, 
2239); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 5841; sec 5, 
Pub. L. 101-575, 104 Stat. 2835 (42 U.S.C. 2243); sec. 1704, 112 
Stat. 2750 (44 U.S.C. 3504 note).

    Sections 110.1(b)(2) and 110.1(b)(3) also issued under Pub. L. 
96-92, 93 Stat. 710 (22 U.S.C. 2403). Section 110.11 also issued 
under sec. 122, 68 Stat. 939 (42 U.S.C. 2152) and secs. 54c and 57d, 
88 Stat. 473, 475 (42 U.S.C. 2074). Section 110.27 also issued under 
sec. 309(a), Pub. L. 99-440. Section 110.50(b)(3) also issued under 
sec. 123, 92 Stat. 142 (42 U.S.C. 2153). Section 110.51 also issued 
under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234). Section 
110.52 also issued under sec. 186, 68 Stat. 955 (42 U.S.C. 2236). 
Sections 110.80-110.113 also issued under 5 U.S.C. 552, 554. 
Sections 110.130-110.135 also issued under 5 U.S.C. 553. Sections 
110.2 and 110.42(a)(9) also issued under sec. 903, Pub. L. 102-496 
(42 U.S.C. 2151 et seq.).


0
2. In Sec.  110.2, the definition of ``nuclear grade graphite'' is 
removed and the definition of ``nuclear grade graphite for nuclear end 
use'' is added to read as follows:


Sec.  110.2  Definitions.

* * * * *

[[Page 41939]]

    Nuclear grade graphite for nuclear end use means graphite having a 
purity level better than (i.e., less than) 5 parts per million boron 
equivalent, as measured according to ASTM standard C1233-98 and 
intended for use in a nuclear reactor. (Nuclear grade graphite for non-
nuclear end use is regulated by the Department of Commerce.)
* * * * *

0
3. In Sec.  110.9, paragraph (e) is revised to read as follows:


Sec.  110.9  List of Nuclear Material under NRC export licensing 
authority.

* * * * *
    (e) Nuclear grade graphite for nuclear end use.


Sec.  110.25  [Removed]

0
4. Remove Sec.  110.25.

0
5. Amend Sec.  110.40 as follows:
0
a. Revise paragraph (b)(3);
0
b. Redesignate paragraphs (b)(4) through (b)(7) as paragraphs (b)(5) 
through (b)(8);
0
c. In newly redesignated paragraph (b)(7), further redesignate 
paragraph (iv) as paragraph (b)(7)(v);
0
d. Revise redesignated paragraph (b)(7)(iii);
0
e. Add new paragraphs (b)(4) and (b)(7)(iv).


Sec.  110.40  Commission review.

* * * * *
    (b) * * *
    (3) Nuclear grade graphite for nuclear end use.
    (4) 1,000 kilograms or more of deuterium oxide (heavy water), other 
than exports of heavy water to Canada.
* * * * *
    (7) * * *
    (iii) Nuclear grade graphite for nuclear end use;
    (iv) 250 kilograms of source material or heavy water; or
* * * * *

0
6. In Sec.  110.41, paragraph (a)(3) is revised, paragraphs (a)(4) 
through (a)(9) are redesignated as paragraphs (a)(5) through (a)(10), 
and a new paragraph (a)(4) is added to read as follows:


Sec.  110.41  Executive branch review.

    (a) * * *
    (3) Nuclear grade graphite for nuclear end use.
    (4) More than 100 curies of tritium, and deuterium oxide (heavy 
water), other than exports of heavy water to Canada.
* * * * *

0
7. In Sec.  110.42, the introductory language of paragraph (b) is 
revised to read as follows:


Sec.  110.42  Export licensing criteria

* * * * *
    (b) The review of license applications for the export of nuclear 
equipment, other than a production or utilization facility, and for 
deuterium and nuclear grade graphite for nuclear end use, is governed 
by the following criteria:
* * * * *

0
8. In Sec.  110.70, paragraph (b)(3) is revised, paragraph (b)(4) is 
redesignated as paragraph (b)(5), and a new paragraph (b)(4) is added 
to read as follows:


Sec.  110.70  Public notice of receipt of an application

* * * * *
    (b) * * *
    (3) 10,000 kilograms or more of heavy water.
    (4) Nuclear grade graphite for nuclear end use.
* * * * *

    Dated in Rockville, Maryland, this 12th day of October, 2004.

    For the Nuclear Regulatory Commission.
Luis A. Reyes,
Executive Director for Operations.

    Editorial note: This document was received at the Office of the 
Federal Register on July 15, 2005.

[FR Doc. 05-14208 Filed 7-20-05; 8:45 am]
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