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The US government is continuing to find ways to help our nuclear industry compete in the global market. In a speech on February 26, the assistant secretary of the US State Department’s Bureau of International Security and Nonproliferation, Dr. Christopher Ford, announced a new policy: the US government would seek to negotiate and enter into “nuclear cooperation memoranda of understanding,” or NCMOUs, with foreign countries who do not yet have 123 Agreements with the United States, as a tool to develop new opportunities to “advance U.S. strategic competitiveness.” While Dr. Ford’s speech lacks details of what the terms of an NCMOU will be or which countries the United States will seek to partner with, the creative focus on supporting US nuclear trade is a welcome development.

Dr. Ford first extolled the virtues of so-called “123 Agreements,” the agreements authorized by Section 123 of the Atomic Energy Act. Without a 123 Agreement, US companies are prohibited from selling nuclear fuel or equipment abroad. A 123 Agreement also requires that the foreign government agree to, in Dr. Ford’s words, “specific standards in such areas as peaceful use, International Atomic Energy Agency (IAEA) safeguards, physical protection for nuclear materials, and prohibitions on enriching, reprocessing, or transferring U.S.-obligated material and equipment without [U.S.] consent.” These agreements, according to Dr. Ford, “can lead to the establishment of political and economic ties lasting as long as 50 or 100 years.”

Dr. Ford’s speech also noted that 123 Agreements can be used to promote nonproliferation goals and to potentially counter the influence of other nuclear suppliers, such as Russia and China, that Dr. Ford characterized as having “lax proliferation standards.” Thus, the State Department continues to look for opportunities to enter into 123 Agreements to counter the promotion of civil nuclear relationships that are “designed – and often used – to advance the strategic goals of these adversaries to the detriment of U.S. interests and those of our allies.”

But Dr. Ford says that the State Department recognizes that the vast majority of countries do not have a fully-developed civil nuclear power industry that requires a full-fledged 123 Agreement. Thus, the US is looking to enter into “less formal, non-binding bilateral political arrangements,” which he termed as NCMOUs. These NCMOUs would be used with countries “weighing the possible development of a nuclear power program.” The State Department’s goal apparently would be to encourage countries that are hoping to take advantage of emerging technologies and coming innovations in reactor design “under the highest standards of safety, security, and nonproliferation.” Beyond the national security interests, Dr. Ford expressly hopes that these NCMOUs will provide opportunity for US companies and workers.

Morgan Lewis will continue to track the State Department’s implementation and development of NCMOUs.