With many companies focused on analyzing transactions for applicability of the Committee on Foreign Investment in the United States’ pilot program mandatory declaration requirements, transacting parties should not lose sight of the need to continue to analyze deals under traditional CFIUS standards.

Read the full LawFlash.

Say hello to CUI and get ready to say goodbye to SUNSI. The commissioners of the Nuclear Regulatory Commission (NRC) have directed the staff to proceed with a rulemaking to implement the governmentwide Controlled Unclassified Information (CUI) program. One impact of this rulemaking will be to eliminate one of our favorite acronyms: Sensitive Unclassified Non-Safeguards Information (SUNSI). But we are still at least a year away from an official change because the staff doesn’t plan to issue a final rule until 2021.

By way of background, the US National Archives and Records Administration (NARA) published the governmentwide CUI rule on September 14, 2016 (81 Fed. Reg. 63,324), seeking to standardize the current patchwork of more than 100 agency-specific policies for handling sensitive unclassified information requiring safeguarding or dissemination controls. That rule (32 CFR Part 2002) establishes specific handling, incident management, inspection, and oversight requirements for covered information. The NRC CUI program will eventually replace the agency’s current SUNSI program, and will retain safeguards information (SGI).

President Donald Trump on January 14 signed into law the Nuclear Energy Innovation and Modernization Act (NEIMA), Pub. L. 115-86, after it was passed by Congress in late December 2018. NEIMA covers a wide variety of issues, but two main topics should be particularly welcomed by the nuclear industry: relief from US Nuclear Regulatory Commission (NRC) fee collection and the clear direction to speed the rollout of an NRC licensing framework for advanced nuclear reactors.

Staff members from the US Nuclear Regulatory Commission’s (NRC’s) Office of Nuclear Security and Incident Response and Office of Nuclear Reactor Regulation held a kickoff meeting on January 10 to discuss the planned assessment of the NRC’s Power Reactor Cyber Security Program. Based on the Nuclear Energy Institute’s PRM-73-18, “Petition to Amend 10 CFR 73.54, ‘Protection of Digital Computer and Communication Systems and Networks,’” as well as NRC guidance, this assessment marks 10 years since the publication of 10 CFR 73.54. The goals of the assessment are to ensure that all licensees have implemented and are complying with 10 CFR 73.54, but to also ascertain licensees’ processes for identifying critical digital assets (CDAs).

The US Nuclear Regulatory Commission’s (NRC’s) revised regulations regarding the medical use of byproduct material became effective on January 14, 2019—six months after being published in final form, and nearly a decade after the proposed rulemaking. See Medical Use of Byproduct Material—Medical Event Definitions, Training and Experience, and Clarifying Amendments, 83 Fed. Reg. 33,046 (July 16, 2018). The revised regulations amend 10 CFR Parts 30, 32, and 35. The NRC also issued guidance to provide additional detail regarding the substance of the revised regulations and to assist licensees with compliance. See Guidance for the Final Rule, Medical Use of Byproduct Material—Medical Events, Definitions, Training and Experience, and Clarifying Amendments, 83 Fed. Reg. 33,759 (July 16, 2018). Among other things, the amendments change the requirements associated with

The NRC issued a Notice of Violation (NOV) on December 17, 2018, to the Wolf Creek Nuclear Operating Company (Wolf Creek) finding that the company violated 10 CFR 50.7, the NRC regulation protecting reactor licensee employees and contractors from retaliation for raising nuclear safety concerns. Based on the level of management involved, the NRC treated the violation as a Severity Level II violation, and proposed a civil penalty of $232,000. The NOV and proposed civil penalty followed an investigation by the NRC Office of Investigations and predecisional enforcement conference (PEC). In addition to the finding of a violation of 10 CFR 50.7 by a reactor licensee involving one of its contractors and the size of the proposed civil penalty, two aspects of the NOV are particularly noteworthy: (1) the form of the adverse action that resulted in the violation; and (2) the evidentiary standard of proof the NRC Staff used to find a violation.

As we reported in 2017, the United Kingdom’s exit from the European Union, set for March 29, 2019, will also include withdrawal of the United Kingdom from the European Atomic Energy Community (Euratom). Exports of nuclear materials, goods, and services from the United States to the United Kingdom currently are authorized through the US–Euratom agreement and the Euratom Cooperation Act of 1958. Essentially, these arrangements are the substitute for a bilateral agreement for cooperation in the peaceful uses of nuclear energy pursuant to Section 123 of the Atomic Energy Act of 1954, as amended (a 123 Agreement), with each of the 28 member countries of Euratom.

The Office of the Federal Register (OFR) is impacted by the partial government shutdown, and is now operating under the special procedures set forth in its December 10, 2018, notice (83 Fed. Reg. 63540) that anticipated a potential funding hiatus. In order to comply with the Antideficiency Act, the OFR will not publish routine notices, but rather it is requiring that agencies such as the Nuclear Regulatory Commission (NRC) certify that any notice to be published in the Federal Register meets an applicable exemption for “emergencies involving the safety of human life or protection of property.” By the express language in 31 USC § 1342, as amended in 1990, this exemption “does not include ongoing, regular functions of government the suspension of which would not imminently threaten the safety of human life or the protection of property.” Therefore, the NRC staff has indicated that publication of a notice for a licensing action, such as a notice of an application for a license amendment, could be delayed due to the above limitations.

A partial government shutdown currently looms on the horizon. The US Nuclear Regulatory Commission (NRC), however, has a budget funded through FY 2019, so it would not be impacted if the government shuts down.

The NRC did experience the effects of a federal government shutdown in 2013. Then, the NRC furloughed 3,600 of 3,900 staff members. The 300 essential personnel who stayed on included about 150 resident inspectors. All public meetings were suspended, and Atomic Safety and Licensing Board hearings were postponed. However, the Inspector General’s Office, as well as the NRC’s hotline for safety and security concerns, continued to function.

On November 19, the Nuclear Regulatory Commission (NRC) Commissioners approved the Staff’s proposed rulemaking plan for expanding physical security licensing options for advanced reactors.

As we previously reported, the NRC Staff sent a report to the Commission on August 1, 2018, that evaluated four options for revising regulations and guidance on physical security for advanced reactors. The report recommended revising applicable regulations and guidance and attached a proposed rulemaking plan. The report noted that the rulemaking would retain the current framework for security requirements in 10 CFR Part 73, but would provide alternatives for the physical security of advanced reactors. According to the report, changes to physical security for advanced reactors would

  • eliminate the need for future applicants to propose alternatives or request exemptions from physical security requirements;
  • recognize technology advancements and design features associated with the NRC-recommended attributes of advanced reactors; and
  • replace prescriptive regulations with risk-informed, performance-based requirements, among other benefits.