In light of the increased globalization of economic activity and the associated complexity of multinational corporate arrangements, the Nuclear Regulatory Commission (NRC) is revisiting its implementation of the statutory prohibition against foreign control of nuclear power plants.  The NRC will be accepting public comments on this issue until August 2, 2013.

The Atomic Energy Act (AEA) and NRC regulations disqualify any application for a nuclear power plant operating license if the applicant is owned, controlled, or dominated by a foreign national, a foreign corporation, or a foreign government (FOCD).  The FOCD provision dates back to 1954, the height of the Cold War.  In subsequent decades, the Atomic Energy Commission and later the NRC interpreted their obligations to allow foreign investment in U.S. nuclear plants provided matters such as security and safety were kept in the hands of U.S. nationals.   

License blocked

In recent years, the trend seems to be reversing.  In one case, the NRC blocked a license for the proposed construction of a third unit at the Calvert Cliffs plant in Maryland because the company proposing the project is owned by the government of France.  A similar case is developing with two proposed reactors in the South Texas Project because of the role of the Japanese Toshiba Corporation, which is partnering with NRG Energy in a joint venture to license and build the units.

Meaning of ‘ownership’

Upon issuing its decision on Calvert Cliffs, the NRC directed its staff to provide a “fresh assessment” of the FOCD.  Issues the staff was told to address included the adequacy of guidance on how U.S. companies can negate direct or indirect foreign financing; the availability of alternative methods, such as license conditions for resolving FOCD concerns; and NRC’s interpretation of the statutory meaning of ‘ownership’ and how that definition applies in various contexts such as total or partial foreign ownership of a licensee’s parent, co-owners, or owners who are licensed to “own but not to possess or operate a facility.” 

The NRC directed the staff to obtain stakeholder views and collect conclusions and recommendations in a voting paper that should be turned over to the commission by December 31, 2013.

NRC’s request for comment was published in the June 3, 2013, Federal Register (FR).