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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

October 2014: 

Nuclear Commerce: 

Additional Actions Needed to Improve DOE's Export Control Process: 

GAO-15-124: 

GAO Highlights: 

Highlights of GAO-15-124, a report to congressional requesters. 

Why GAO Did This Study: 

Encouraging U.S. exports of civilian nuclear products, services, and 
technology while ensuring they are not used for foreign nuclear 
weapons programs is a fundamental goal of U.S. policy. Exports of U.S. 
civilian nuclear technology, assistance, and services are regulated by 
DOE through 10 C.F.R. Part 810. Depending on the importing country and 
technology, exports can be generally authorized, with no application 
required, or specifically authorized, in which case the exporter must 
submit an application to DOE. The Departments of Commerce, Defense, 
and State, as well as the Nuclear Regulatory Commission, also review 
the applications, which must finally be approved by the Secretary of 
Energy. 

GAO was asked to examine the Part 810 process. This report examines 
(1) Part 810 processing times over the last 6 years compared with 
DOE's targets; (2) the extent to which Part 810's scope is clear and DOE 
can reasonably assure consistent interpretation; and (3) the extent to 
which DOE enforces Part 810. GAO analyzed all 89 specific 
authorizations granted from 2008-2013 and interviewed key agency 
officials and U.S. nuclear industry representatives. 

What GAO Found: 

The Department of Energy (DOE) has consistently missed its 30-day 
targets for the initial and interagency stages of the Part 810 review 
process (see table). From 2008 through 2013, DOE missed the target for 
the initial review stage for 80 of 89 applications processed, and 
interagency review times missed DOE's 30-day target for 85 
applications. DOE has not established a target for the entire final 
review stage, which had the longest median review times, or for the 
overall process. DOE has acknowledged exporter concerns that 
processing times for specific authorizations can impose business 
risks, and DOE officials have proposed initiatives to reduce 
processing times. 

Table: 

Target review time: 
Initial review stage: 30 days; 
Interagency review stage: 30 days; 
Final review stage: None. 

Median Review time: 
Initial review stage: 71 days; 
Interagency review stage: 105 days; 
Final review stage: 125 days. 

Longest review time: 
Initial review stage: 1,035 days; 
Interagency review stage: 810 days; 
Final review stage: 921 days. 

Shortest review time: 
Initial review stage: 0 days[A]; 
Interagency review stage: 12 days; 
Final review stage: 14 days. 

Reviews exceeding 30 days: 
Initial review stage: 80 of 89; 
Interagency review stage: 85 of 89; 
Final review stage: 86 of 89. 

Source: GAO analysis of Department of Energy information. GAO-15-124. 

[A] The 0-day initial review was for an amended application whose 
initial review was completed the same date the amended application was 
submitted. 

[End of table] 

The scope of Part 810 is unclear, and DOE's inquiry process does not 
reasonably assure that the regulation is consistently interpreted. For 
example, it is unclear what marketing activities are covered by Part 
810. DOE has not provided written guidance to clarify the regulation's 
scope, instead directing exporters to inquire with DOE officials. DOE 
officials said that they do not document all such inquiries or their 
responses. Without such documentation, DOE can neither reasonably 
assure that its responses are consistent, nor can it analyze the 
inquiries to identify parts of the regulation that may need 
clarification. DOE is taking some steps to clarify Part 810 by 
defining or refining some key terms. However, DOE's revisions do not 
address all terms that exporters have identified as unclear, and the 
time frame of DOE's revisions is unknown. 

DOE has taken limited actions to enforce Part 810. DOE's primary 
method for monitoring compliance with Part 810 is reading reports from 
exporters, but according to DOE officials, they conduct in-depth 
analysis on less than 10 percent of reports and do not have a risk-
based procedure for selecting reports to analyze. Also, because DOE 
does not provide guidance for companies to self-identify and self-
report possible violations, DOE is missing an opportunity to leverage 
exporters' role in monitoring their own compliance. DOE has not yet 
determined whether it has the legal authority to impose civil 
penalties for violations of Part 810. According to DOE officials, DOE 
has never taken a formal action for a violation of Part 810, such as 
revoking an authorization or referring a potential violation to the 
Department of Justice (DOJ). Furthermore, DOJ officials reported that 
they are not aware of any prosecutions related to Part 810 violations 
from 2008-2013, the time frame GAO reviewed. 

What GAO Recommends: 

GAO recommends that the Secretary of Energy take several actions to 
improve the Part 810 process, such as determine whether DOE has legal 
authority to impose civil penalties, and establish realistic and 
achievable targets for each stage of the Part 810 process, as well as 
the overall process. DOE agreed with the recommendations. 

View [hyperlink, http://www.gao.gov/products/GAO-15-124]. For more 
information, contact David C.Trimble at (202) 512-3841 or 
trimbled@gao.gov or Thomas Melito at (202) 512-9601 or melitot@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

DOE Consistently Missed Target Time Frames for Processing Part 810 
Applications, with the Interagency and Final Review Stages Taking 
Longest: 

Part 810 Is Unclear in Its Scope, and DOE's Inquiry Process Does Not 
Reasonably Assure Consistent Interpretation: 

DOE Has Taken Limited Actions to Enforce Its Nuclear Export Controls: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: Enforcement Tables: 

Appendix III: Comments from the Department of Energy: 

Appendix IV: GAO Contacts and Staff Acknowledgments: 

Tables: 

Table 1: U.S. Nuclear Export Control Regime: 

Table 2: Comparison of Processing Times for Part 810 Process: 

Table 3: Common Conditions for Specific Part 810 Authorizations for 
Deemed Exports, 2008-2013: 

Table 4: Common Conditions for Specific Part 810 Authorizations Other 
Than for Deemed Exports, 2008-2013: 

Table 5: Conditions Imposed through Specific Authorizations for 18 
Deemed Exports, 2008-2013: 

Table 6: Conditions Imposed through Specific Authorizations for 72 
Technology Exports (Other Than Deemed Exports), 2008-2013: 

Figures: 

Figure 1: The Three-Stage Process for Reviewing Commercial Nuclear 
Technology Export Applications under 10 C.F.R. Part 810: 

Figure 2: Median Processing Time per Stage Compared with Applicable 
Targets: 

Figure 3: Median Processing Time per Stage for Deemed and Other 
Exports: 

Figure 4: Specific Authorizations by Year, 2008-2013: 

Abbreviations: 

AEA: Atomic Energy Act: 

ANS: American Nuclear Society: 

AUECO: Association of University Export Control Officers: 

BIS: Bureau of Industry and Security: 

Commerce: Department of Commerce: 

DDTC: Directorate of Defense Trade Controls: 

DOD: Department of Defense: 

DOE: Department of Energy: 

DOJ: Department of Justice: 

IAEA: International Atomic Energy Agency: 

ISO: International Standards Organization: 

ITAR: International Traffic in Arms Regulations: 

MOX: mixed oxide: 

NE: Office of Nuclear Energy: 

NEI: Nuclear Energy Institute: 

NIC: Nuclear Infrastructure Council: 

NNSA: National Nuclear Security Administration: 

NPT: Treaty on the Non-Proliferation of Nuclear Weapons: 

NRC: Nuclear Regulatory Commission: 

NSG: Nuclear Suppliers Group: 

OEE: Office of Export Enforcement: 

OIP: Office of International Programs: 

State: Department of State: 

UAE: United Arab Emirates: 

[End of section] 

United States Government Accountability Office: 
GAO:
441 G St. N.W. 
Washington, DC 20548: 

October 14, 2014: 

The Honorable Fred Upton: 
Chairman: 
Committee on Energy and Commerce: 
House of Representatives: 

The Honorable Tim Murphy: 
Chairman: 
Subcommittee on Oversight and Investigations: 
Committee on Energy and Commerce: 
House of Representatives: 

Renewed interest in nuclear power worldwide has led to increased 
concerns about limiting the spread of nuclear weapons-relevant 
technology. Seeking a balance between encouraging U.S. exports of 
civilian nuclear products, services, and technology while ensuring 
they are not used for foreign nuclear weapons programs has long been a 
fundamental goal of U.S. policy. The U.S. nuclear industry faces 
formidable competition abroad from foreign companies, some of which 
receive strong financial and political support through direct 
government ownership or subsidies. As we reported in 2010, the U.S. 
share of global nuclear exports decreased during the period from 1994 
through 2008.[Footnote 1] U.S. nuclear companies have raised concerns 
that, compared with the nuclear export control regimes of their major 
competitors--in Russia, Japan, South Korea, and France--the U.S. 
regime is, in many respects, more complex, restrictive, and time-
consuming. 

In 2010, we found that U.S. industry representatives believed that 
certain U.S. government policies and practices--particularly the 
Department of Energy's (DOE) authorization process under 10 C.F.R. 
Part 810--impeded the U.S. nuclear industry's ability to compete 
globally.[Footnote 2] Part 810 empowers the Secretary of Energy to 
authorize persons subject to the jurisdiction of the United States to 
directly or indirectly engage in the development or production of 
special nuclear material, which includes plutonium,[Footnote 3] 
outside of the United States, upon a determination that the activity 
will not be inimical to the national interest. Part 810 applies 
broadly to commercial nuclear technology, assistance, and services 
abroad because nuclear reactors fueled with uranium also produce 
plutonium. Nuclear technology and assistance may include training and 
services in support of commercial power reactors, as well as tangible 
items such as manuals, blueprints, and software. Exports subject to 
Part 810 also include the transfer of technology to non-U.S. persons 
in civilian U.S. nuclear facilities and universities.[Footnote 4] 

Exports with little or no proliferation or national security 
significance may be generally authorized under Part 810, with no 
application required. For example, the export of commercial nuclear 
power reactor technology may be generally authorized unless intended 
for restricted countries or nationals of those countries, to which any 
export of civilian nuclear technology must be specifically authorized 
through an application to DOE.[Footnote 5] Transactions with a more 
direct relationship to the production of special nuclear material must 
always be specifically authorized through an application to DOE, 
regardless of the countries involved.[Footnote 6] DOE's procedures for 
approving specifically authorized exports include target time frames, 
and the authorizations include conditions to hold the exporter, 
importer, and importing government accountable for protecting the 
technology and reducing the risk of proliferation. DOE data show that 
the value of generally authorized transactions is currently in the 
range of $2 billion to $3 billion per year, and the total value of 
specifically authorized transactions since 2009 is at least $13.6 
billion. According to DOE officials and nuclear industry 
representatives, Part 810 applications are typically the initial foray 
into a broader nuclear relationship with a foreign partner company or 
foreign country.[Footnote 7] 

In 2010,[Footnote 8] we recommended that DOE review the Part 810 
process and develop guidelines to help clarify the types of 
technology, information, and technical assistance that require a Part 
810 authorization, among other things. Clarity and consistency are 
among the key principles of efficient regulation, according to two 
executive orders.[Footnote 9] DOE reviewed the Part 810 process and, 
in August 2013, DOE issued a Supplemental Notice of Proposed 
Rulemaking,[Footnote 10] with the purpose of "striking a balance to 
promote trade without increasing proliferation risk," by clarifying 
the scope of the regulation, among other things. In this proposed 
rule, DOE further noted that the goals of Part 810 were efficient 
regulation--defined by an efficient, timely, transparent, and 
predictable regulatory process; effective nuclear trade support; and 
effective threat reduction by better addressing proliferation 
challenges. 

In light of the international security and commercial implications of 
the export of U.S. civilian nuclear technology, you asked us to 
examine the Part 810 process. This report examines (1) Part 810 
processing times, compared with DOE's targets, for applications over 
the last 6 years; (2) the extent to which the scope of Part 810 is 
clear and DOE can reasonably assure consistent interpretation; and (3) 
the extent to which DOE enforces Part 810. 

To examine processing times over the last 6 years for Part 810 
applications, we reviewed DOE's 10 C.F.R. Part 810 Assistance to 
Foreign Atomic Energy Activities Part 810 Program Elements to 
determine DOE's target time frames, and analyzed data on the 
processing times for specific authorizations granted from 2008 through 
2013. We selected eight applications to examine in more depth and 
interviewed agency officials to better understand the factors 
affecting processing times. We also interviewed representatives of 
nuclear exporters (including representatives of nuclear companies and 
industry organizations, as well as university export control officers) 
regarding how Part 810 processing times affect exporters, and we 
reviewed public comments submitted in response to DOE's proposed 
changes. To examine the extent to which the scope of Part 810 is clear 
and DOE can reasonably assure that the regulation is consistently 
interpreted, we consulted the Atomic Energy Act, the federal standards 
for internal control,[Footnote 11] and executive orders related to 
government regulation,[Footnote 12] and we interviewed DOE officials 
and representatives of nuclear exporters for their views on the 
clarity of the regulation, and reviewed public comments submitted in 
response to DOE's proposed changes. To examine the extent to which DOE 
enforces Part 810, we reviewed the authorization letters signed by the 
Secretary that state a determination that the proposed export is not 
inimical to the interest of the United States, provided that the 
conditions imposed in the authorization are met. We also interviewed 
DOE officials and Part 810 applicants about these conditions and the 
mechanisms DOE uses to enforce the regulation. 

We conducted this performance audit from August 2013 to October 2014 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. Appendix I 
contains more detailed information on the scope and methodology of our 
review. 

Background: 

Different federal agencies have jurisdiction to control various types 
of nuclear-related exports; DOE regulates the export of nuclear 
technology through Part 810, which implements Section 57(b) of the 
Atomic Energy Act; DOE and the Department of Justice (DOJ) have roles 
in enforcing Part 810. 

Nuclear Export Controls: 

Four federal agencies share jurisdiction over nuclear-related exports, 
with different agencies regulating different types of such exports. 
DOE regulates exports of commercial nuclear technology and assistance 
through its National Nuclear Security Administration's (NNSA) Office 
of Nonproliferation and International Security.[Footnote 13] The 
Nuclear Regulatory Commission (NRC) regulates exports of commercial 
nuclear materials and equipment through its Office of International 
Programs (OIP). Nuclear materials and equipment include certain 
enriched uranium and reactor components, respectively. The Department 
of Commerce (Commerce) regulates dual-use items--those that can be 
used for both commercial and military applications--and certain 
military items. Nuclear dual-use items include, among other things, 
turbines, generators, and machine tools. The Department of State 
(State) regulates munitions items and technologies--those designed, 
developed, configured, adapted, or modified solely for military 
applications. Table 1 provides additional detail on the U.S. nuclear 
export control regime. 

Table 1: U.S. Nuclear Export Control Regime: 

Agency and authority: Department of Energy National Nuclear Security 
Administration (Part 810); 
Jurisdiction: Nuclear technology and services related to the 
production of special nuclear material; 
Examples: 
* Providing information or assistance to address a radiological 
emergency; enhance the safety of a civilian nuclear facility in 
certain other countries; 
* Participating in open meetings sponsored by educational, scientific, 
or technical organizations; approved exchange and International Atomic 
Energy Agency (IAEA) programs; 
* Providing sensitive nuclear technology (for example, through 
blueprints, manuals, or services); 
* Designing, building, or operating: production reactors, facilities 
for enrichment or reprocessing; or some research and test reactors; 
* Deemed exports and deemed re-exports (activities of non-U.S. persons 
accessing U.S. nuclear technologies). 

Agency and authority: Nuclear Regulatory Commission (Part 110); 
Jurisdiction: Nuclear reactors, reactor components, and material; 
Examples: 
* Nuclear reactor or fuel cycle facilities; 
* Reactor components; 
* Special nuclear material and source material; 
* Byproduct material; 
* Deuterium (heavy hydrogen); 
* Nuclear grade graphite for nuclear end use. 

Agency and authority: Department of Commerce (Export Administration 
Regulations); 
Jurisdiction: Nuclear-related dual-use items; 
Examples: 
* Pressure transducers, mass spectrometers, machine tools; 
* Health and safety equipment; 
* Turbines, generators, pipes, and valves; 
* Materials and manufacturing equipment; 
* General infrastructure, telecommunications; 
* and maintenance equipment. 

Agency and authority: Department of State (International Traffic in 
Arms Regulations); 
Jurisdiction: Defense articles and services; 
Examples: 
* Nuclear reactors and associated power conversion systems associated 
with spacecraft; 
* Nuclear thermal propulsion systems associated with spacecraft. 

Sources: GAO analysis of agency data. GAO-15-124. 

[End of table] 

The Atomic Energy Act and the Part 810 Process: 

DOE regulates exports of commercial nuclear technology and assistance 
under section 57(b) of the Atomic Energy Act (AEA), which governs 
development or production of special nuclear material outside the 
United States. DOE implements section 57(b) through the regulations at 
10 C.F.R. Part 810. Part 810 applies to commercial activities because 
nuclear reactors fueled with uranium also produce plutonium. Section 
57(b) of the AEA requires establishment of orderly and expeditious 
procedures, to include, among other things, explicit direction on the 
handling of requests to engage or participate in development or 
production of special nuclear material outside of the United States 
and express deadlines for soliciting and collecting the views of the 
other agencies (with identified officials responsible for meeting such 
deadlines). Activities generally authorized under Part 810 do not 
require prior application to or notification of the Secretary of 
Energy, although companies must report certain information about such 
activities to DOE within 30 days. Applications for specific 
authorization, which must be approved by the Secretary of Energy, 
undergo a three-stage review process, as depicted in figure 1. 

Figure 1: The Three-Stage Process for Reviewing Commercial Nuclear 
Technology Export Applications under 10 C.F.R. Part 810: 

[Refer to PDF for image: process illustration] 

Stage I—-Initial review: 

Application received; 
National Nuclear Security Administration (NNSA) Office of 
Nonproliferation and International Security: 
* Initial analysis; 
* Recommendation; 
Department of Energy (DOE) review: 
* NNSA staff; 
* DOE Nuclear Energy; 
* General Counsel. 
DOE: Send approval recommendation to interagency for review. 

Stage II—-Interagency review: 
Interagency review: 
* Department of State (State); 
* Department of Commerce; 
* Nuclear Regulatory Commission; 
* Department of Defense; 
State:
* Requests written nonproliferation assurances from host government; 
* Receives assurances. 
DOE time frame: 30 days. 

Stage III-—Final review: 
NNSA Office of Nonproliferation and International Security: 
Draft authorization approval recommendation; 
Review: 
* NNSA staff; 
* DOE staff: 
- General Counsel; 
- DOE Nuclear Energy; 
* Secretary approval
* Issue authorization; 
DOE time frame: none[A]. 

Source: NNSA. GAO-15-124. 

[A] There is no target time frame for the entire final review stage; 
however, the Secretary is to be provided with a recommendation 
regarding the determination no later than 30 days following receipt of 
the interagency concurrence or views (or 60 days in the event of 
interagency disagreements). 

[End of figure] 

In the first or "initial" review stage, NNSA prepares an analysis of 
each application. In the second or "interagency" review stage, NNSA 
provides the application to State for concurrence and to the NRC, 
Commerce, and the Department of Defense (DOD) for consultation. 
[Footnote 14] DOE's target time frames for completion of the initial 
and interagency review stages are 30 days each. DOE does not have a 
target time frame for completion of the third or "final" review stage, 
in which NNSA and DOE staff conduct a final review of the application 
and make a recommendation to the Secretary, who then makes a 
determination as to whether the proposed export would be inimical to 
the national interest. DOE does, however, have an interim target 
within the final review stage for providing a recommendation to the 
Secretary. Specifically, NNSA's procedures for processing, reviewing, 
and approving specific authorizations state that the Secretary is to 
be provided with a recommendation no later than 30 days following 
receipt of the interagency concurrence or views, or 60 days in the 
event of interagency disagreements.[Footnote 15] 

Enforcement: 

Both DOE and DOJ have a role in the enforcement of Part 810. DOE may 
act to correct deficiencies in applications or processes, or obtain an 
injunction or restraining order to prevent violation of Part 810, and 
may refer suspected criminal violations to DOJ for investigation and 
possible prosecution under the AEA. Any person convicted of violating, 
conspiring, or attempting to violate Section 57 of the AEA; or of 
willfully falsifying, concealing, or covering up a material fact or 
making false, fictitious or fraudulent statements or representations 
may be fined or imprisoned or both. Further, under Part 810, if a 
violation of the AEA is committed with intent to injure the United 
States or to aid a foreign nation, the penalty could be up to life 
imprisonment and a $20,000 fine. DOE has not yet determined whether it 
has legal authority to apply civil penalties for violation of Part 
810. DOE monitors compliance with Part 810 in part through reports 
that exporters are required to submit on authorized activities. 

The United States has pledged to adhere to a set of guidelines that 
include export licensing regulations, enforcement procedures, and 
penalties for violations. These guidelines, developed by nuclear 
supplier countries (the Nuclear Suppliers Group [NSG]), aim to ensure 
that trade in civilian nuclear technologies does not contribute to 
nuclear proliferation.[Footnote 16] The NSG was established in 1975, 
and since 1978, it has published guidelines which cover transfers of 
nuclear and nuclear-related dual use equipment, material, software, 
and related technology. These guidelines lay out principles for the 
members to apply, in accordance with their national requirements. All 
NSG members, including the United States, have pledged to put in place 
legal measures to ensure the effective implementation of the NSG 
guidelines. 

DOE Consistently Missed Target Time Frames for Processing Part 810 
Applications, with the Interagency and Final Review Stages Taking 
Longest: 

From 2008 through 2013, DOE consistently missed its 30-day targets to 
complete the initial and interagency stages of the Part 810 review 
process. Specifically, during this period, DOE missed the target to 
complete the initial stage of review for 80 of the 89 applications 
processed. Similarly, interagency review times missed DOE's target for 
85 of the applications. The third stage, for which DOE has not 
established a target time frame, had the longest median review times. 
(See figure 2). U.S. nuclear exporters said that the lengthy and 
unpredictable Part 810 time frames can impose business risks. 

Figure 2: Median Processing Time per Stage Compared with Applicable 
Targets: 

[Refer to PDF for image: vertical bar graph] 

Review stage: Initial; 
Median processing time: 71 days; 
DOE target: 30 days. 

Review stage: Interagency; 
Median processing time: 105 days; 
DOE target: 30 days. 

Review stage: Final[A]; 
Median processing time: 125 days. 

Source: GAO analysis of National Nuclear Security Administration data. 
GAO-15-124. 

[A] There is no target time frame for the entire final review stage; 
however, the Secretary is to be provided with a recommendation 
regarding the determination no later than 30 days following receipt of 
the interagency concurrence or views (or 60 days in the event of 
interagency disagreements). 

[End of figure] 

DOE Missed Its Target to Complete Initial Review for 90 Percent of 
Applications: 

We found that DOE missed its target to complete initial review for 90 
percent (80 of 89) of the applications for specific authorization 
approved from 2008 through 2013 (no application was denied during this 
period). DOE took a median of 71 days to complete the initial review 
stage, with DOE's longest initial review taking 1,035 days.[Footnote 
17] In this stage, NNSA prepares an analysis of each application based 
on a set of technical and other reviews by experts in DOE's National 
Laboratories, its Office of Nuclear Energy (NE) and Office of General 
Counsel, and NNSA's Office of General Counsel. NNSA considers eight 
factors, including whether the United States has an agreement for 
nuclear cooperation with the nation or group of nations involved; 
whether the country is a party to the Treaty on the Non-Proliferation 
of Nuclear Weapons (NPT); and whether the country involved has entered 
into an agreement with the International Atomic Energy Agency (IAEA) 
for the application of safeguards on all its peaceful nuclear 
activities. 

For the two applications that we reviewed based on their initial 
review times--one that met the 30-day initial review target, and one 
that did not--the nature of the proposed export affected the initial 
review times. Specifically, an application for a U.S. company to 
provide assistance to the United Arab Emirates' (UAE) nuclear 
regulatory body had a 29-day initial review stage (meeting the 30-day 
target), because, according to DOE officials, the details of the 
application matched those of another recently submitted application. 
As a result, DOE's internal review of this application could leverage 
the work completed for the preceding application. The application that 
missed the target, taking 186 days for initial review, was for the 
export of mixed oxide (MOX) fuel fabrication technology to the United 
Kingdom.[Footnote 18] According to DOE officials, MOX is a sensitive 
technology, which requires greater scrutiny. 

Interagency Review Times Missed DOE's Target for More Than 95 Percent 
of Applications: 

Interagency review times missed DOE's 30-day target for 85 of the 89 
applications approved from 2008 through 2013. The interagency review 
stage was the second longest in the process, with a median review time 
of 105 days. Ten applications took more than a year for interagency 
review. As noted earlier, in this stage, DOE seeks concurrence from 
State, and consults Commerce, NRC, and DOD. These agencies have 30 
days to provide comments or concurrence, including any conditions they 
would place on the authorization. 

State took the longest among the agencies to provide its comments or 
concurrence. State's median review time--86 days--was nearly three 
times longer than DOE's 30-day target. According to DOE and State 
officials, State's concurrence times depend on, among other things, 
the responsiveness of the importing country in providing assurances of 
peaceful use and no re-export without U.S. government consent. 
[Footnote 19] For example, NNSA sent an application package for 
interagency review in April 2009 asking for responses within 30 days 
for the export of a computer program to a Chinese university for 
teaching and research purposes. State concurred in January 2011, about 
2 weeks after receiving the foreign government assurance and almost 2 
years after receiving the letter from NNSA. Agency officials 
attributed the 645-day interagency review period to delays in 
obtaining assurances from the Chinese government. 

State officials, who obtain assurances through embassy staff, told us 
they have not established a time frame for the embassies to respond, 
but they noted that it is rare for embassy staff not to follow up on 
an assurance request expeditiously. Embassy staff, who receive 
instructions and background documents from State headquarters, often 
work to make sure that the facts listed in the request for assurances 
are correct and that the staff have current information for points of 
contact for the importer, which is a key step in the assurance 
process. State officials recognized the need to streamline the process 
for obtaining assurances in countries with growing nuclear markets, 
such as China and the UAE. Of the 89 applications DOE approved from 
2008 through 2013, 23 were for exports to the UAE--more than any other 
country--largely for U.S. persons to provide expertise to the UAE's 
Emirates Nuclear Energy Corporation and nuclear regulatory body. In 
2010, State developed generic assurances for Part 810 authorizations 
to the UAE, based on an agreed-upon template, so that the language 
would not need separate negotiation for each application. These 
generic assurances confirm that the transferred technology will be 
used exclusively for civil nuclear power activities and not for any 
nuclear explosive or other military purpose and that the technology 
will not be retransferred outside the UAE without prior U.S. consent. 
State officials said they would seek to streamline the assurance 
process in other countries where needed, based on growth in their 
nuclear industries, which drives the number of requests for assurances. 

Foreign government assurance times are not a factor in interagency 
review times in the cases of deemed exports--foreign nationals who 
access nuclear technology subject to Part 810 in the United States--
because, in these cases, DOE requires U.S. employers of the foreign 
nationals to obtain written nonproliferation assurances from the 
employees rather than from the foreign government. However, the median 
interagency review time for such cases--46 days--still exceeded DOE's 
target of 30 days. Notably, the longest interagency review of 810 days 
was for a deemed export.[Footnote 20] The 46-day median interagency 
review time for deemed export applications was shorter than that for 
other export applications--126 days. See figure 3 for interagency 
review times for deemed and all other exports. 

Figure 3: Median Processing Time per Stage for Deemed and Other 
Exports: 

[Refer to PDF for image: 2 vertical bar graphs] 

Deemed exports: 

Review stage: Initial; 
Median processing time: 122 days; 
DOE target: 30 days. 

Review stage: Interagency; 
Median processing time: 49 days; 
DOE target: 30 days. 

Review stage: Final[A]; 
Median processing time: 285 days. 

All other exports: 

Review stage: Initial; 
Median processing time: 66 days; 
DOE target: 30 days. 

Review stage: Interagency; 
Median processing time: 122.5 days; 
DOE target: 30 days. 

Review stage: Final; 
Median processing time: 113.5 days. 

Source: GAO analysis of National Nuclear Security Administration data. 
GAO-15-124. 

[End of figure] 

In some cases, foreign policy considerations affect interagency review 
times. For example, a U.S. government hold on civil nuclear 
cooperation with Russia following its 2008 military actions in Georgia 
accounted for a large part of the 840-day interagency review for an 
application to export nuclear fuel specifications to Russia. The 
application, submitted in January 2008, had reached the final review 
stage in August 2008, when NNSA held it in abeyance because of 
Russia's actions.[Footnote 21] Following the signing of the New START 
Treaty in April 2010 and resubmission of the U.S.-Russia nuclear 
cooperation agreement to Congress in May 2010,[Footnote 22] nuclear 
cooperation with Russia resumed, and NNSA requested that interagency 
reviewers resubmit their views on the application from 2008 as soon as 
possible and emphasized the need for promptness. 

Interagency review times vary among countries and within the same 
country. For example, among the three countries with the most Part 810 
applications (excluding deemed exports)--UAE, China, and Russia--
interagency review times for exports to the UAE ranged from 27 to 344 
days; review times for exports to China ranged from 46 days to 749 
days; and review times for exports to Russia ranged from 35 to 840 
days. 

Final Review Was the Longest Stage: 

Our analysis found that the final review stage, for which DOE has not 
established comprehensive targets, had the longest median processing 
times--125 days--with seven applications taking more than a year for 
final review and approval. In the final stage, NNSA's and DOE's 
Offices of General Counsel and DOE's Office of Nuclear Energy review 
the applications, and NNSA prepares a package of materials for the 
Secretary's determination. According to DOE's procedures, the 
Secretary is to be provided with a recommendation no later than 30 
days following receipt of the interagency concurrence or views (or 60 
days in the event of interagency disagreements).[Footnote 23] The 
Secretary of Energy reviews the package to determine whether the 
activities covered by the Part 810 application will not be inimical to 
the interest of the United States. Under the AEA, the Secretary may 
not delegate the determination.[Footnote 24] 

We found variability in final-stage processing times across countries. 
For example, for the three countries with the most Part 810 
applications (excluding deemed exports)--UAE, China, and Russia--
median completion times for final review ranged from 100 days for the 
UAE to 127 days for China. Final review times for applications for 
exports to the same country also varied. For example, the shortest 
final review time for an export to Russia was 35 days and the longest 
was 194 days; final review times for exports to the UAE ranged from 31 
days to 197 days (excluding deemed exports). The longest final review 
took 921 days, for a deemed export. 

A variety of factors contributed to the duration of final review. For 
an application to transfer controlled technology to Indian nationals 
working at a U.S. nuclear facility, DOE's Office of General Counsel's 
concerns about the application package contributed to DOE's final 
review times of 241 days. According to NNSA officials, this 
application was 1 of 10 delayed for this reason. Once DOE General 
Counsel completed its revisions, NNSA sent a memorandum to the 
Secretary recommending approval of the application, which the 
Secretary granted within 2 weeks. 

In the final review stage, conditions that agencies imposed as part of 
their concurrence may also affect review times. In one case, DOD 
placed restrictions on foreign nationals' access to information and 
facilities as a condition of its concurrence, in August 2010. Pending 
reconsideration of these conditions, NNSA held this application in 
abeyance for 10 months, starting in December 2010,[Footnote 25] 
contributing to a final review stage of 634 days, out of a total 
processing time of 824 days for the application. The following 
October, DOD concurred with the application without conditions after 
reviewing the background of the foreign nationals and the DOE staff 
analysis that determined that transfer of the technology would be 
appropriate and would not pose a risk to the facility where they would 
be employed. 

NNSA has a 30-day target (60 days in the case of interagency 
disagreement) within the final review stage for providing a 
recommendation to the Secretary, but does not track the dates that it 
provides these recommendations. For the 10 applications for which we 
could determine the date that NNSA provided a recommendation to the 
Secretary, DOE exceeded the 30-day target for 9 applications. Of 
these, 2 were held in abeyance as described above. 

Table 2 provides a comparison of processing times for each stage in 
the process and shows shortest and longest review at each stage. 

Table 2: Comparison of Processing Times for Part 810 Process: 

Target review time; 
Initial review stage: 30 days; 
Interagency review stage: 30 days; 
Final review stage: None. 

Median review time; 
Initial review stage: 71 days; 
Interagency review stage: 105 days; 
Final review stage: 125 days. 

Longest review; 
Initial review stage: 1,035 days; 
Interagency review stage: 810 days; 
Final review stage: 921 days. 

Shortest review; 
Initial review stage: 0 days[A]; 
Interagency review stage: 12 days; 
Final review stage: 14 days. 

Reviews exceeding 30 days; 
Initial review stage: 80 of 89; 
Interagency review stage: 85 of 89; 
Final review stage: 86 of 89. 

Source: GAO analysis of NNSA data. GAO-15-124. 

[A] The 0-day initial review was for an amended application whose 
initial review was completed the same date the amended application was 
submitted. 

[End of table] 

DOE's targets are not comprehensive, as DOE has not established 
targets for the entire third stage of the Part 810 process, or for 
overall processing time. By comparison, NRC has established targets--
which are part of its performance metrics--for processing export 
licenses. We have identified measurable, numerical targets as key 
attributes of successful performance measures.[Footnote 26] 
Furthermore, the rate at which DOE has missed its targets calls into 
question whether these targets are realistic and achievable. According 
to a 2007 executive order on improving government program performance, 
[Footnote 27] program goals should be sufficiently aggressive but 
realistic in light of authority and resources assigned. Without 
measurable and realistic targets, DOE cannot determine whether its 
Part 810 process is meeting its goal of efficient regulation, which 
includes timeliness. 

Realistic targets could also further DOE's goal of efficient 
regulation--another aspect of which is predictability--by giving 
exporters a sense of how long the application process may take. 
According to some nuclear exporters, the lengthy and unpredictable 
specific authorization process affects the competitiveness and hiring 
practices of their companies and universities. One company, in its 
comments on DOE's proposed changes to Part 810, noted that the Part 
810 process is unpredictable, and that predictability is important for 
business planning. An industry organization representative we spoke to 
also emphasized the importance of predictability, stating that nuclear 
companies understand that nuclear matters may take a long time but 
that it is important to know how long things may take. 

DOE and Representatives of U.S. Nuclear Exporters Stated That the 
Lengthy Part 810 Process Can Impose Business Risks: 

DOE, in its preamble to the proposed changes to Part 810, acknowledged 
nuclear exporters' concerns that the time frame for processing 
specific authorizations can impose business risks for companies. In 
comments on DOE's proposed changes to Part 810, the Nuclear Energy 
Institute (NEI), an industry group that represents hundreds of nuclear 
companies,[Footnote 28] wrote in November 2013 that the specific 
authorization process was a cause of delay and uncertainty, and a 
distinct disadvantage, for U.S. exporters. Representatives of one U.S. 
nuclear exporter told us that Chinese clients had advised the company 
against submitting a bid if it would require a specific authorization. 
According to a representative from a second company, the delays in 
obtaining a Part 810 authorization inhibit the demonstration and 
deployment of reactor technology. 

According to industry representatives and university officers, Part 
810 processing times may also delay or restrict the work or study of 
foreign nationals in the United States. The Ad-Hoc Utilities Group, 
another industry group, described the "two equally unsatisfactory 
alternatives" where (1) companies can either delay hiring foreign 
nationals or (2) hire them but limit the scope of their work functions 
until approval of the authorization. For example, a representative 
from a nuclear company told us that an engineer from India employed at 
a U.S. nuclear plant was unable to carry out the full scope of duties 
without a specific authorization, which took 14 months to process. The 
engineer left the job before the authorization was granted. According 
to the Ad-Hoc Utilities Group, it is impractical for nuclear power 
operators to offer a foreign national a job that depends on a specific 
authorization that can take a year to obtain. The group added that 
Part 810 hinders utilities from hiring qualified foreign employees for 
positions that require access to certain nuclear-related materials. As 
a result, the group wrote, Part 810 can deter the hiring of workers 
who can safely operate nuclear power plants. In addition, a university 
officer whose institute offers a nuclear science and engineering 
program told us that Part 810 imposes a barrier for U.S. universities 
in recruiting faculty and students that the universities' foreign 
competitors do not face. 

DOE Has Begun Efforts to Improve the Part 810 Process, Including the 
Development of an E-Licensing System: 

DOE has begun efforts to reduce processing times of Part 810 
applications. For example, NNSA officials said they plan to build an e-
licensing system for the Part 810 process and are finalizing the 
details regarding the functionality of such a system. The e-licensing 
system would track applications as they proceed through the 
authorization process, allowing NNSA to monitor its performance in 
processing them. NNSA officials said that the e-licensing system would 
improve predictability by allowing applicants to track their 
applications throughout the process, including the interagency review. 
NNSA is also working to become compliant with the International 
Standards Organization (ISO)-9001, a quality management 
standard,[Footnote 29] and the Part 810 process is part of this 
initiative. NNSA officials told us that the agency has completed the 
initial interview phase of the ISO certification process, as well as 
the Lean Six Sigma process,[Footnote 30] but NNSA's time frame for 
becoming compliant with the ISO-9001 standard is unclear. 

Part 810 Is Unclear in Its Scope, and DOE's Inquiry Process Does Not 
Reasonably Assure Consistent Interpretation: 

Part 810 is unclear with regard to the activities it covers, among 
other things. DOE has not provided written guidance to help exporters 
interpret the scope of the regulation; instead, DOE encourages 
exporters to inquire with DOE officials for interpretation. DOE cannot 
reasonably assure that its responses to inquiries are consistent, 
however, because DOE officials do not routinely document these 
inquiries or DOE's responses. DOE has taken steps to clarify the 
regulation and is planning to develop guidance. 

Part 810 Is Unclear in Its Scope: 

Part 810 is unclear with regard to the scope of activities covered and 
application requirements. For example, key definitions do not make it 
clear which activities are subject to the regulation. This affects, 
among other things, how companies conduct marketing activities related 
to nuclear reactors. Two executive orders identify clarity and 
consistency among the key principles of federal regulation.[Footnote 
31] We identified the following three areas regarding the lack of 
clarity in the regulation: 

* Key definitions in Part 810 are broad. The regulation's definition 
of "nuclear reactor" does not distinguish among reactor components 
based on their relative sensitivities. Representatives of nuclear 
exporters have said that the regulation's definition of "nuclear 
reactor"--as "an apparatus, other than a nuclear explosive device, 
designed or used to sustain nuclear fission in a self-supporting chain 
reaction"--is overly broad and could be interpreted to encompass a 
wide variety of technologies unrelated to the production of special 
nuclear material. For example, NEI noted in its comments on DOE's 
proposed revisions to Part 810 that nuclear reactors, under DOE's 
definition, contain thousands of components and systems, only some of 
which, such as the reactor pressure vessel,[Footnote 32] relate to the 
production of special nuclear material.[Footnote 33] The group raised 
concerns that absent a clearer definition of the technologies covered 
within the scope of "nuclear reactor," companies would be forced to 
seek time-consuming advisory opinions for each item in a nuclear power 
plant. By contrast, NRC's export control regulations provide an 
illustrative list of covered nuclear reactor components,[Footnote 34] 
and representatives of exporters suggested in their public comments 
that DOE compile a similar list. 

* Part 810 does not explicitly address sales or marketing. The 
regulation does not contain provisions that specifically address 
marketing and does not clearly delineate the types of marketing 
information that may require a general or specific authorization. A 
representative of an association for nuclear companies told us that 
this has created confusion and that exporters determine whether sales 
and marketing information is covered based on whether the information 
is public or proprietary. However, exporters noted in their public 
comments on DOE's proposed revisions to Part 810 that marketing 
activities may entail the transfer of general design or price 
information that is proprietary but not sufficiently detailed to 
assist in production of special nuclear material. Nonetheless, such 
information may fall under the jurisdiction of Part 810 because it is 
not "public information," which is generally authorized for transfer 
(and would be exempt under the proposed rule).[Footnote 35] A company 
representative told us that absent greater clarity, companies are 
limited in marketing a design and advancing a contract because 
customers request detailed information--which may be proprietary--to 
understand how much they would be willing to pay for a product. 
Representatives of another company told us that it took 2 years to get 
the specific authorization to disclose the information needed for a 
marketing activity. While DOE has proposed to adjust its definitions 
related to public information,[Footnote 36] it has declined to specify 
what marketing activities may be exempt from authorization--stating 
that the regulation's applicability depends on the data transferred 
rather than the activity--and has instead noted in its Supplemental 
Notice of Proposed Rulemaking that companies can seek guidance from 
the department on a case-by-case basis. 

* The regulation does not clearly specify the information and 
documents that applicants are required to submit. DOE's review of Part 
810 applications may be prolonged because applicants may not submit 
all of the information required, which may occur because it is 
sometimes unclear to applicants what information is required. For 
example, a university export control officer told us that she applied 
for a specific authorization for a course being developed on operating 
a nuclear power plant. More than 5 weeks after submitting the 
application, a DOE official requested additional information from the 
applicant--specifically, résumés for the foreign nationals involved. 
The university officer said that, unlike with other export control 
regimes, DOE does not provide guidance on the application materials 
necessary for Part 810, and that she would have included the résumés 
at the beginning of the process if she had known she needed to provide 
them.[Footnote 37] Section 57(b) of the AEA states that, to the extent 
practicable, an applicant should be advised of all the information 
required at the beginning of the process. NNSA officials told us that 
Part 810 contains the application requirements; however, the 
regulation does not list, for example, résumés among the requirements. 
The university officer said she submitted the additional information 
to DOE, and DOE officials informed her 4 weeks later that the activity 
would not require specific authorization. 

DOE Does Not Provide Exporters with Supplemental Guidance and Its 
Inquiry Process Does Not Reasonably Assure Consistency: 

DOE does not provide supplemental guidance to help exporters interpret 
the scope and requirements of Part 810. According to an OMB bulletin, 
agencies increasingly have relied on guidance documents to inform the 
public and to provide direction to their staffs as the scope and 
complexity of regulatory programs have grown.[Footnote 38] According 
to this bulletin, guidance documents, used properly, can channel the 
discretion of agency employees, increase efficiency, and enhance 
fairness by providing the public clear notice of the line between 
permissible and impermissible conduct, while ensuring equal treatment 
of similarly situated parties. We found that the other agencies that 
regulate civilian nuclear exports--NRC and Commerce--do provide 
written guidance, such as frequently-asked-questions documents, to 
clarify their interpretation of the regulations to exporters.[Footnote 
39] Nuclear exporters said that such guidance would be helpful for 
Part 810. According to one company, a more comprehensive explanation 
of activities that require specific authorization would afford U.S. 
businesses the opportunity to adequately plan for international 
commitments. 

DOE's practice is to provide guidance on a case-by-case basis on its 
interpretations of various Part 810 provisions, but this guidance is 
provided only to the specific party and is not made public. One 
company wrote in its public comments on DOE's proposed revisions to 
Part 810 that, rather than requiring companies to obtain advisory 
opinions with respect to proposed activities, DOE and the nuclear 
industry would benefit from DOE's establishment of clearer boundaries 
for the applicability of Part 810. University export officers also 
said that DOE declined their request to clarify which types of 
university activities would require authorization, but encouraged the 
officers to inquire or apply so that DOE could make a case-by-case 
determination. These officers raised concerns that the lack of clarity 
in Part 810, together with the uncertainty about DOE's decisions 
regarding what activities require authorization, may restrict 
scientific communication by creating confusion about what universities 
may share openly. 

Without established written guidance, exporters uncertain about the 
scope of Part 810 must inquire with DOE for interpretation. Under Part 
810, potential applicants may request advice on, among other things, 
whether a proposed activity falls within the scope of the regulations 
or requires specific authorization. According to DOE's Part 810 
procedures, DOE receives numerous inquiries from U.S. persons and 
firms regarding activities that may fall under the scope of Part 810 
regulations. NNSA officials told us they receive approximately two 
inquiries in the form of letters and more than 10 inquiries by phone 
each week. According to DOE's Part 810 procedures, most of these 
inquiries are requests for interpretation of the regulation or 
requests for review of proposed financial ventures with foreign 
entities. These inquiries require the input of a wide range of 
expertise from various sources inside DOE and elsewhere that are 
consolidated into informal written or oral guidance or for formal 
correspondence. DOE's responses to these inquiries are significant, 
because, as DOE acknowledges, the specific-authorization process can 
be protracted, and its approval time frames can impose business risks 
for U.S. companies. 

Several representatives of nuclear exporters told us that DOE 
responded promptly to inquiries, but that the need to consult DOE to 
clarify the scope and applicability of the regulation contributed to a 
process that was too dependent on individual interpretation. For 
example, one company representative told us that there was no way of 
knowing whether other companies were getting the same response--with 
regard to what type of authorization would be needed--for the same set 
of circumstances. A university export officer said that a definition 
provided by DOE in the course of an inquiry appeared to be "made up on 
the spot." Another company representative suggested that a potential 
applicant could get a different answer depending on which official at 
DOE takes the call, based on an individual interpretation with no 
basis in the regulation. This representative said that DOE's inquiry 
system provides companies with an incentive to proceed with the 
activity in question without consulting DOE. Specifically, the 
representative noted that an inquiry could lead to a response that the 
transaction could not proceed without waiting for an authorization. If 
the company proceeds without inquiring, however, and DOE later 
determines that the transaction required authorization, this 
representative believes that the company would be able to defend 
itself against any enforcement action because DOE would not be able to 
point to the specific regulatory language on which it based its 
determination. 

DOE officials do not consistently document inquiries or their 
responses, and cannot analyze them for consistency or to identify 
parts of the regulation that may need clarification. Part 810 does not 
require exporters to submit inquiries for interpretation of the scope 
of the regulation, or for DOE to respond to them, in writing or 
electronically.[Footnote 40] However, DOE's internal procedures state 
that DOE is to maintain a database that includes a listing of and 
files for all inquiries, and other export-control agencies such as 
State and Commerce do require written or electronic submissions and 
responses for inquiries regarding jurisdiction.[Footnote 41] DOE 
officials said that they do not document all inquiries or responses 
because some inquiries are vague, and DOE's responses are 
predecisional. However, as noted earlier, DOE's responses to these 
inquiries are significant because of the time frames of the specific 
authorization process; they determine whether or not an activity is 
subject to the regulation and whether an exporter has to engage in the 
time-consuming authorization process. Documenting all inquiries and 
responses would provide DOE with the information needed to reasonably 
assure that the agency's responses are consistent under similar 
circumstances, and to identify aspects of the regulation that may need 
clarification. Under the federal standards for internal control, 
agencies are to accurately record and appropriately document 
transactions.[Footnote 42] Documentation of transactions is also 
important because gaps can develop in an organization's institutional 
knowledge and leadership as experienced employees leave.[Footnote 43] 
Some nuclear exporters expressed concerns in this regard, stating 
that, while the staff that currently implements Part 810 is competent 
and helpful, the system should not rely on individuals, and that a 
change of staff could make the process more difficult. 

DOE Has Taken Steps to Clarify the Regulation: 

DOE has taken steps to clarify Part 810, recognizing in its 
Supplemental Notice of Proposed Rulemaking that the scope of 
activities regulated under Part 810 could be clearer.[Footnote 44] For 
example, DOE is proposing to define some key terms, such as "technical 
assistance," and to refine its definitions of other terms, for example 
by replacing its prior definition of "public information" with 
definitions of "publicly available information" and "publicly 
available technology," so that potential applicants would have a 
clearer description of activities and technology subject to Part 810. 
However, DOE's proposed rule neither clarifies the scope of the 
regulation by refining the definitions of other broad terms, such as 
"nuclear reactor,[Footnote 45]" or by providing an illustrative list 
of reactor components, nor more clearly delineates sales and marketing 
activities subject to Part 810. DOE officials have said that they plan 
to develop guidance once the proposed changes to the regulation are 
finalized, but the proposed changes are an ongoing effort whose time 
frame and eventual impact are unclear. 

DOE Has Taken Limited Actions to Enforce Its Nuclear Export Controls: 

DOE has taken limited actions to enforce its export controls for 
nuclear technology, assistance, and services, even though DOE must 
enforce Part 810 to achieve one of its goals for the regulation--
effective threat reduction by mitigating the risk of proliferation. 
One way that DOE seeks to mitigate this risk is through conditions 
included in Part 810 specific authorizations; most authorizations are 
subject to common sets of conditions. DOE's primary method for 
monitoring compliance with the conditions is for NNSA officials to 
read required reports from exporters and in some cases to conduct a 
more in-depth analysis of the reports. However, NNSA officials report 
that they typically conduct an in-depth analysis for compliance with 
the authorizations on less than 10 percent of the reports, and they do 
not have risk-based procedures for prioritizing which reports to 
analyze. DOE does not provide guidance for companies to self-identify 
and self-report violations. DOE has not determined whether it has the 
authority to impose civil penalties for violations of Part 810 and has 
not referred any potential violations to the Department of Justice 
(DOJ) for investigation or criminal prosecution within the last 6 
years, the period covered by our review. 

Most Part 810 Authorizations Are Subject to Common Sets of Conditions: 

On the basis of our analysis of all 89 specific authorizations 
approved between 2008 and 2013, we identified two common sets of 
conditions--one for deemed exports, another for all other exports--
that DOE imposes on specific authorizations. These conditions are 
enumerated in "Secretarial Determinations"--the authorization letters 
signed by the Secretary that state a determination that the proposed 
export is not inimical to the interest of the United States, as long 
as the conditions are met. The conditions on each authorization 
reflect the actions that DOE, State, Commerce, NRC, and DOD judge 
sufficient to mitigate the risk of proliferation in a given 
circumstance and which result in the export benefiting U.S. interests. 

The common set of conditions on specific authorizations for deemed 
exports--in this case, foreign nationals who access nuclear technology 
in the United States--includes five conditions that appear in nearly 
all of the 18 authorizations for such exports (see table 3). These 
conditions require the company or other applicant seeking the 
authorization to (1) ensure that the foreign national maintains a 
current passport and work visa, (2) notify DOE promptly upon 
termination or change in immigration status for the foreign national, 
(3) submit to DOE for prior approval changes in the foreign national's 
work duties, (4) report annually to DOE on activities pursued by each 
foreign national covered by the authorization, and (5) obtain a signed 
nonproliferation or nondisclosure statement from the foreign national. 
In addition, there are other conditions that have been imposed less 
frequently; for example, DOE imposed conditions on some specific 
authorizations involving transfers of certain technologies related to 
reactor operations to certain foreign nationals in the United States. 
These conditions state that these individuals cannot have access to 
sensitive nuclear technology[Footnote 46] or software programming 
language (see appendix II). 

Table 3: Common Conditions for Specific Part 810 Authorizations for 
Deemed Exports, 2008-2013: 

Condition: Ensure that the foreign national maintains a current 
passport and visa; 
Responsibility: U.S. company; 
Frequency: 16 of 18[A]. 

Condition: Notify DOE promptly upon termination or change in 
immigration status for the foreign national; 
Responsibility: U.S. company; 
Frequency: 17 of 18. 

Condition: Submit to DOE for prior approval changes in the foreign 
national's work duties; 
Responsibility: U.S. company; 
Frequency: 17 of 18. 

Condition: Report annually to DOE on activities pursued by each 
foreign national under the authorization; 
Responsibility: U.S. company; 
Frequency: 17 of 18. 

Condition: Obtain from the foreign national a signed nonproliferation 
or nondisclosure statement; 
Responsibility: U.S. company, foreign national; 
Frequency: 17 of 18[B]. 

Source: GAO analysis of DOE information. GAO-15-124. 

[A] Two authorizations did not contain this condition. In one, the 
foreign nationals were being employed through a German affiliate. The 
other authorization was for the transfer of technology to a company in 
India, as well as Indian nationals in the company's U.S. affiliate. 
The latter authorization also did not have the next two common 
conditions shown in the table and required quarterly, rather than 
annual, reports. 

[B] One authorization, for the transfer of mixed oxide fuel 
fabrication technology to a South African national, did not require a 
nonproliferation statement or a nondisclosure statement. 

[End of table] 

The common set of conditions for specific authorizations (other than 
deemed exports) includes four conditions that appear in nearly all of 
the 72 authorizations for these types of exports (see table 4). The 
first two conditions--a requirement to use the technology for peaceful 
(nonmilitary and nonnuclear weapons) purposes and a requirement to 
obtain permission before re-exporting the technology to a country 
other than the United States--are the responsibility of the importer 
and the importing country's government to implement, and they are 
known collectively as "foreign government assurances." The other two 
conditions are the responsibility of the exporter. These include 
requirements to (1) report to DOE on the activities conducted under 
the authorization on a quarterly, semiannual, or annual basis and (2) 
submit for prior DOE approval the names of any companies or 
individuals, beyond those listed in the original application, to which 
the exporter proposes transferring the technology. There are other 
conditions that have been imposed less frequently; for example, about 
20 percent of the authorizations (13 of the 72) contain a condition 
that requires the importer and the importing country to take all 
measures necessary to maintain adequate protection of the technology 
and, in some cases, also to ensure adequate physical protection of any 
items derived from it (see appendix II). 

Table 4: Common Conditions for Specific Part 810 Authorizations Other 
Than for Deemed Exports, 2008-2013: 

Condition: Peaceful (nonmilitary, nonexplosive) use; 
Responsibility: Importing country, importing company or other entity; 
Frequency: 70 of 72[A]. 

Condition: Re-export permission required[B]; 
Responsibility: Importing country, importing company or other entity; 
Frequency: 70 of 72[C]. 

Condition: Submit for prior DOE/NNSA approval names of additional 
companies or individuals to which the exporter proposes transferring 
the technology; 
Responsibility: Exporter (U.S. company or other entity); 
Frequency: 70 of 72[D]. 

Condition: Report to DOE/NNSA on activities conducted under the 
authorization; 
Responsibility: Exporter (U.S. company or other entity); 
Frequency: 70 of 72[E]. 

Source: GAO analysis of DOE information. GAO-15-124. 

[A] Two authorizations for exports to China did not explicitly contain 
conditions on peaceful use. However, the authorizations stated that 
the transferred technology would be subject to the Agreement for 
Cooperation between the Government of the United States of America and 
the Government of the People's Republic of China Concerning Peaceful 
Uses of Nuclear Energy of July 23, 1985. This agreement provides that 
transferred technology may not be used for any nuclear explosive 
device, for research specifically on or development of any nuclear 
explosive device, or for any military purpose. 

[B] Some authorizations state that prior written permission is 
required for re-exports, while in other cases, they do not state that 
written permission be "prior." In one authorization, the condition 
required "prior coordination," without defining what coordination 
would entail. 

[C] Two authorizations for exports to China did not explicitly contain 
conditions on re-export. However, the authorizations stated that the 
transferred technology would be subject to the Agreement for 
Cooperation between the Government of the United States of America and 
the Government of the People's Republic of China Concerning Peaceful 
Uses of Nuclear Energy of July 23, 1985. This agreement provides that 
transferred technology may not be retransferred outside the parties' 
boundaries unless the parties agree. 

[D] Two authorizations for exports to the UAE did not contain this 
condition. 

[E] Two authorizations, one for the export of sensitive nuclear 
technology to Germany and the other for computer codes to China, did 
not contain any reporting requirements. 

[End of table] 

DOE Does Not Use a Risk-Based Procedure to Determine Which Reports to 
Analyze for Compliance: 

NNSA officials, who implement Part 810, draw on various information 
sources to monitor compliance with the conditions on authorizations. 
NNSA officials said their primary source of information is the reports 
submitted by exporters. These reports are required by the conditions 
on the specific authorizations, as described above, as well as by Part 
810, which contains reporting requirements for all specifically 
authorized exports and certain generally authorized exports.[Footnote 
47] Exporters who are required to report on generally authorized 
activities must do so no more than 30 days after they begin.[Footnote 
48] According to an NNSA official, some generally authorized 
activities would trigger frequent reports, so NNSA negotiates a filing 
frequency for the exporters to report all of their generally 
authorized activities on a consolidated basis instead of requiring 
reports for each activity. For specific authorizations, exporters must 
also report no more than 30 days after they initiate activities, 
[Footnote 49] and, depending on the conditions contained in their 
authorization, they are also required to submit ongoing reports that 
detail their activities conducted under the authorization on a 
quarterly, semiannual, or annual basis. 

NNSA officials stated that they read and categorize each report as it 
is received. If they decide that a particular report merits further 
attention, they conduct follow-up analysis, which includes checking 
that the activities and individuals listed are consistent with the 
application and the authorization. However, NNSA officials stated that 
they currently do not conduct such an analysis for every report to 
determine compliance or to identify trends; the officials estimate 
that they currently conduct follow-up analysis on less than 10 percent 
of reports. They also stated that they do not have procedures for 
determining which reports merit in-depth analysis and that their 
current practice is to decide on a case-by-case basis according to the 
type of technology and parties involved. As a result, NNSA may be 
missing important information that could lead to identification of 
violations and provide a fuller understanding of the degree of 
compliance with Part 810. 

We requested information on the number of reports NNSA received from 
2008-2013 for generally and specifically authorized exports. For 
generally authorized exports, NNSA officials stated that they had a 
gap in their data that prevented them from providing complete 
information during these 6 years, but according to their data, they 
received at least 50 reports per year from 2009-2013. For specifically 
authorized exports, NNSA officials stated that providing information 
on the number of reports received would be challenging. 

NNSA officials said that their report analysis process is not as 
systematic as they would like, but noted that they do not have the 
staff to analyze the reports more thoroughly. According to NNSA 
officials, they employ two people who work full-time on Part 810 
authorizations, as well as six people who work on the authorizations 
as part of their broader responsibilities. Officials at the national 
laboratories also assist with reviewing reports, based on the end user 
and the type of technology being transferred, according to NNSA 
officials. Staffing levels in the NNSA office that processes these 
authorizations and reviews the reports have remained level over the 
last 6 years, but the number of specific authorizations granted each 
year has increased (see figure 4). An NNSA official noted that the 
office is looking into changes that could be made to the report 
analysis process to facilitate monitoring for compliance, such as 
linking the reports to the authorizations in the proposed e-licensing 
system. 

Figure 4: Specific Authorizations by Year, 2008-2013: 

[Refer to PDF for image: vertical bar graph] 

Year: 2008; 
Number of applications approved: 2. 

Year: 2009; 
Number of applications approved: 10. 

Year: 2010; 
Number of applications approved: 15. 

Year: 2011; 
Number of applications approved: 19. 

Year: 2012; 
Number of applications approved: 21. 

Year: 2013; 
Number of applications approved: 22. 

Source: GAO analysis of National Nuclear Security Administration data. 
GAO-15-124. 

[End of figure] 

NNSA officials said they have other sources of information for 
monitoring compliance with Part 810 authorizations, including the 
national laboratories, trade publications, and newsletters from a 
variety of sources, as well as the companies themselves (NNSA 
periodically asks companies for briefings). They stated that they also 
receive support from the intelligence community, including DOE's 
Office of Intelligence and Counterintelligence. In addition, according 
to a State official, U.S. embassies play a role in monitoring the 
extent to which the importing country and company or other entity, as 
well as the exporter, are complying with the conditions associated 
with Part 810 authorizations. 

DOE Has Not Determined Its Authority to Impose Civil Penalties and 
Does Not Provide Guidance for Companies to Self-Identify and Self-
Report Possible Violations: 

DOE has not determined whether it has legal authority to impose civil 
penalties for violations of Part 810 and does not provide guidance for 
companies to self-identify and self-report possible violations. Part 
810 contains a statement about the actions that DOE can take to 
prevent violations under the authority of the AEA (temporary 
injunctions and restraining orders) and a description of penalties for 
criminal violations. However, Part 810 does not indicate that DOE can 
impose civil penalties for violations, and DOE officials told us that 
the issue of whether the department has the authority to impose civil 
penalties was "unsettled."[Footnote 50] We have previously found that 
civil penalties are an important element of regulatory enforcement, 
allowing agencies to punish violators appropriately and to serve as a 
deterrent to future violations.[Footnote 51] Without a clear position 
on whether DOE has authority to impose such penalties for violations 
of Part 810, DOE may not have access to a tool for enforcing its 
export controls. 

Furthermore, DOE does not provide any external guidance to exporters 
on enforcement of Part 810, such as a voluntary disclosure policy, 
internal compliance guidelines, or an enforcement manual, in the 
regulation, or, according to DOE officials, elsewhere. In contrast to 
DOE, other government agencies that regulate nuclear or nuclear-
related exports have established procedures, as well as policies and 
guidelines on enforcement of their export controls. As discussed 
below, NRC, State, and Commerce provide a variety of resources for 
companies to understand the enforcement policies for their respective 
export control regimes and to provide incentives for companies to 
recognize and address violations. These resources are publicly 
available on the agencies' websites. In addition, information on civil 
and criminal enforcement is stated in the regulations governing their 
respective export control regimes. 

* NRC has an enforcement policy and enforcement manual. NRC has a 
publicly available enforcement policy document that lays out the 
general principles governing its enforcement efforts and information 
on the process it uses to deal with violations. NRC also has an 
enforcement manual that contains specific processes and guidance for 
implementing the enforcement policy. The stated goals of NRC's 
enforcement policy are to (1) deter noncompliance by emphasizing the 
importance of compliance with regulations and other NRC requirements, 
and (2) encourage prompt identification and prompt comprehensive 
correction of violations. The policy clearly describes the factors 
that NRC takes into consideration when assessing the significance of 
the violation and describes how prompt self-identification of 
violations can decrease consequences for violators. In addition, NRC 
publishes on its website Notices of Violation, which can serve as 
examples of how violations are assessed and fines are determined. Its 
website also contains the Part 110 regulations, which describe, among 
other things, the civil penalties and the procedures through which 
they would be applied, in the case of violations. 

* State's website contains compliance resources, including guidelines 
for comprehensive compliance programs. State's Directorate of Defense 
Trade Controls (DDTC) maintains a website with a variety of compliance-
related resources and documents for exporters, including a list of 
significant export control enforcement cases. The site contains the 
International Traffic in Arms Regulations (ITAR), of which Parts 127 
(Violations and Penalties) and 128 (Administrative Procedures) lay out 
State's enforcement policies, including its voluntary disclosure 
policy, the aim of which is to strongly encourage self-disclosure of 
violations by noting that such disclosures may be considered as 
mitigating factors in determining penalties.[Footnote 52] The site 
also provides guidelines that exporters can use to create 
comprehensive operational compliance programs. The guidelines do not 
promote a certain type of program; instead, they list the important 
elements of effective programs, including organizational structure; 
corporate commitment and policy; identification, receipt and tracking 
of controlled items and technical data; re-exports; and internal 
monitoring, and training, among other elements. 

* Commerce's website provides a variety of compliance and enforcement 
information. Commerce's Bureau of Industry and Security (BIS) has an 
Office of Export Enforcement (OEE) that works with companies to 
prevent export control violations and is responsible for enforcement 
actions in response to such violations. OEE's website contains, among 
other things, information on compliance, penalties, and voluntary self-
disclosures, including voluntary self-disclosure cases. The BIS 
website contains the Export Administration Regulations, which govern 
the export of dual-use items and certain military items. Part 764, 
"Enforcement and Protective Measures," provides readers with 
information on enforcement, including voluntary self-disclosure and 
civil penalties, and Part 766, "Administrative Enforcement 
Proceedings," describes the administrative enforcement process and 
includes guidance on how BIS makes penalty determinations. 

While DOE's export controls and their regulatory basis may differ in 
some aspects from those administered by NRC, State, and Commerce, 
these other agencies provide information to companies and individuals 
to help them understand how to comply with their rules and the 
consequences of violating those rules. Several exporters told us that 
other agencies provide guidance that is more comprehensive. By not 
establishing policies or creating guidance that encourages companies 
to create strong compliance programs and self-identify and self-report 
violations, DOE is missing an opportunity to leverage exporters' 
potential to play a greater role in monitoring their own compliance. 

DOE and DOJ Have Not Taken Any Formal Actions to Enforce Part 810: 

Neither DOE nor DOJ have taken formal actions--such as revoking an 
authorization or prosecuting an exporter--to enforce Part 810 within 
the last 6 years, even though there have been violations of Part 810 
within this period. Between 2008 and 2013, NNSA received at least 11 
notices of voluntary disclosures of violations of the Part 810 
regulations, mostly related to deemed exports to India or China--but 
according to an NNSA official, any time NNSA knows of a violation of 
the Part 810 regulations, NNSA tries to deal with it internally, 
generally meeting with the company to discuss the issue. This official 
reported that NNSA has not identified any willful violations of Part 
810,[Footnote 53] and consequently, NNSA has not referred any 
potential criminal violations to the DOJ for investigation or 
prosecution. According to DOE and NNSA officials, NNSA has never taken 
any formal action, such as revoking an authorization, against 
companies that have violated Part 810. DOE's internal procedures for 
administering Part 810 contain no information on DOE enforcement of 
the regulation. DOJ, which is charged with investigating and 
prosecuting suspected criminal violations, reports that of the cases 
charged under the AEA in the last 6 years, it is not aware of any 
related to Part 810 violations. 

Conclusions: 

The renewed interest in nuclear power worldwide could provide 
increased opportunities for U.S. companies. The highly competitive 
global nuclear market underscores the importance of an efficient 
authorization process for U.S. nuclear technology exports. DOE has 
stated that its goals for the Part 810 process are efficient 
regulation (defined by an efficient, timely, transparent, and 
predictable process); effective nuclear trade support; and effective 
threat reduction by better addressing proliferation challenges. DOE 
and NNSA have taken steps toward a more efficient regulatory process, 
including developing an e-licensing system. However, DOE and NNSA's 
current implementation of Part 810 raises questions as to whether the 
agencies are administering the process in accordance with DOE's goals 
and with key principles of federal regulation, which include clarity 
and consistency. 

DOE rarely meets its existing target time frames for processing Part 
810 applications, which calls into question whether these targets are 
realistic and achievable in light of its resources and authorities. 
Furthermore, DOE has not established target time frames for obtaining 
the Secretary's determination in the third stage of the process, or 
for the overall Part 810 authorization process. Without realistic and 
achievable targets for the entire Part 810 process, DOE cannot provide 
U.S. nuclear exporters with a timely and predictable regulatory 
process, which could impair their competitiveness. 

DOE has taken steps to clarify the scope of Part 810, but DOE 
officials plan to continue to rely on a case-by-case inquiry process. 
DOE currently does not document all inquiries, contrary to agency 
procedures. Without a documented inquiry process, DOE does not have 
the information it needs to provide reasonable assurance that its 
responses are consistent, and DOE officials are not documenting 
information that could identify parts of the regulation that may need 
clarification. 

DOE must enforce Part 810 to achieve one of its goals for the 
regulation--effective threat reduction by mitigating the risk of 
proliferation. However, DOE may be missing opportunities to enforce 
its nuclear export controls. Civil penalties are an important element 
of regulatory enforcement, but DOE has not determined whether it has 
the legal authority to impose civil penalties for violations of Part 
810. In addition, NNSA does not conduct in-depth analysis on all 
reports from exporters on activities authorized under Part 810 and 
does not have a risk-based procedure for prioritizing which reports to 
analyze. As a result, NNSA may be missing important information that 
could lead to identification of violations and allow the agency to 
take enforcement actions when warranted. Moreover, unlike other 
agencies that administer nuclear-related export controls, DOE does not 
have policies or guidance for exporters about self-identifying, self-
reporting, and correcting possible violations. Consequently, DOE is 
missing an opportunity to encourage exporters to recognize and address 
violations. 

Recommendations for Executive Action: 

We are making six recommendations to improve the administration of 10 
C.F.R. Part 810. 

* To better align the Part 810 process with its stated goal of 
efficient regulation, we recommend that the Secretary of Energy, 
working with the Administrator of the National Nuclear Security 
Administration, take the following two actions: 

- Review existing targets for processing Part 810 applications and 
determine the extent to which they align with DOE's resources and 
authorities. Based on the results of this review, establish realistic 
and achievable targets for each stage of the Part 810 process, 
including the third stage, as well as the overall process. 

- As DOE moves forward with the e-licensing system, integrate these 
targets into the system to monitor agency performance against them to 
ensure that the targets remain realistic and achievable and that they 
improve predictability for exporters. 

* To promote clarity and consistency in administering Part 810, we 
recommend that the Administrator of the National Nuclear Security 
Administration ensure that all inquiries about the scope of Part 810, 
together with NNSA's responses to these inquiries, are documented, in 
accordance with existing DOE procedures. 

* To facilitate enforcement of Part 810 and encourage compliance, we 
recommend that the Secretary of Energy, working with the Administrator 
of the National Nuclear Security Administration, take the following 
three actions: 

- Determine whether DOE has legal authority to impose civil penalties 
for violations of the regulation and develop procedures accordingly. 

- Develop a risk-based procedure for selecting exporters' reports on 
authorized activities for in-depth analysis. 

- Assess the need to establish and articulate export compliance 
policies that encourage and reward exporters who self-identify, self-
report, and correct violations, and provide guidance to exporters on 
such policies. 

Agency Comments and Our Evaluation: 

We provided a draft of this report to DOE, NRC, State, Commerce, DOD, 
and DOJ for review and comment. NNSA provided written comments for 
DOE, which are presented in appendix III. In addition, NNSA, NRC, 
State, Commerce, and DOJ provided technical comments that we 
incorporated, as appropriate. 

In its written comments, NNSA agreed with all six of our 
recommendations and noted several actions and initiatives it is 
planning or undertaking to implement our recommendations. For example, 
NNSA stated that as part of its ongoing process improvements, the 
agency is working to identify gaps, overlaps, and inefficiencies in 
the Part 810 authorization process and will establish new, achievable 
targets for each stage of the Part 810 process. Among other things, 
NNSA also stated that it plans to consult with other regulatory 
agencies, such as NRC, to determine what risk-based procedures the 
agency has for analyzing reports on authorized activities and whether 
they could be modified to work for Part 810 reports. NNSA also stated 
that it would consult with regulatory agencies such as NRC and 
Commerce to determine what export compliance policies they have for 
encouraging and rewarding self-disclosure and whether they could be 
modified for Part 810 self-reporting. 

NNSA also provided general comments on some of our findings. For 
example, NNSA stated that the draft report frequently draws 
comparisons between DOE's Part 810 process and other agencies' export 
control regimes. NNSA stated that, unlike the other regimes, DOE's 
export authorization process involves other agencies and diplomatic 
engagements with foreign governments, whose responsiveness the U.S. 
government cannot control. We note that our analysis considered 
relevant differences in the export control regimes. As noted above, 
NNSA concurred with our recommendations and stated that it would 
consider whether the processes of these agencies could be adapted for 
Part 810. 

NNSA also stated that the ability to devise "creative solutions" for 
unique or new situations remains an important aspect of the Part 810 
authorization process, and that consistent guidance in light of such 
situations is inapplicable. However, as noted in the report, DOE must 
reasonably assure that its interpretation of Part 810 is consistent in 
responding to wide-ranging questions from exporters. 

In addition, NNSA stated that the Department clearly took seriously 
the recommendations from our report, Nuclear Commerce: Governmentwide 
Strategy Could Help Increase Commercial Benefits from U.S. Nuclear 
Cooperation Agreements with Other Countries (GAO-11-36), as evidenced 
by the current rulemaking, process improvements, and the creation of 
an e-810 system. We noted the actions DOE took in response to these 
recommendations in the current report. However, because the rulemaking 
and process improvements were ongoing at the time of our audit, we 
could not evaluate the extent to which these initiatives will address 
the findings and recommendations in this report. NNSA said that our 
draft report stated that DOE had not proposed revising its inquiry 
process, but noted that its initiatives will address the inquiry 
process, and that the inquiries we referred to are exploratory and 
informal. We clarified the language in the report to address NNSA's 
comment. However, as we say in the report, several exporters whom we 
interviewed expressed concern about the consistency of the responses 
DOE was providing to their inquiries. We could not evaluate whether 
DOE's responses to inquiries were consistent because DOE does not 
document all inquiries. Without such documentation, DOE cannot 
reasonably assure that the interpretations offered in response to 
these inquiries are consistent. 

Finally, in its written comments, NNSA stated that it is true that it 
has not referred any suspected Part 810 violations to the Department 
of Justice for criminal investigation or revoked any authorizations 
for cause but that it has not received reports of illicit technology 
transfers or seen evidence of violations of Part 810 authorization 
restrictions. We recommend in this report, as a step in strengthening 
export controls through Part 810, that DOE take a risk-based approach 
to reviewing reports for in-depth analysis from exporters and assess 
the need for guidance and incentives to exporters for self-
identifying, self-reporting, and correcting possible violations. NNSA 
agreed with these recommendations. 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies to the 
appropriate congressional committees, the Secretary of Energy, the 
Administrator of the National Nuclear Security Administration, the 
Secretary of State, the Chairman of the Nuclear Regulatory Commission, 
the Secretary of Defense, the Secretary of Commerce, and other 
interested parties. The report also will be available at no charge on 
the GAO website at [hyperlink, http://www.gao.gov]. 

If you or your staff members have any questions about this report, 
please contact David C. Trimble at (202) 512-3841 or trimbled@gao.gov 
or Thomas Melito at (202) 512-9601 or melitot@gao.gov. Contact points 
for our Offices of Congressional Relations and Public Affairs may be 
found on the last page of this report. GAO staff who made key 
contributions to this report are listed in appendix IV. 

Signed by: 

David C. Trimble: 
Director, Natural Resources and Environment: 

Signed by: 

Thomas Melito: 
Director, International Affairs and Trade: 

[End of section] 

Appendix I: Scope and Methodology: 

In this report, we examine (1) Part 810 processing times, compared 
with the Department of Energy's (DOE) targets, for over the last 6 
years; (2) the extent to which Part 810 is clear and DOE can 
reasonably assure consistent interpretation; and (3) the extent to 
which DOE enforces Part 810. 

To examine DOE's processing times for Part 810 applications over the 
last 6 years compared with its own targets, we reviewed DOE's 10 
C.F.R. Part 810 Assistance to Foreign Atomic Energy Activities Part 
810 Program Elements and the National Nuclear Security 
Administration's (NNSA) procedures for processing, reviewing, and 
approving specific authorizations[Footnote 54] to determine DOE's 
internal targets. We analyzed DOE data on the processing times for the 
89 specific authorizations granted from 2008 through 2013.[Footnote 
55] For each authorization, the analysis included a calculation of the 
number of days between the date of each application for authorization 
and the date of the Secretary's determination, which encompasses the 
entire Part 810 process. We also calculated the number of days between 
each of the three stages of the process--initial review, interagency 
review, and final review. We calculated the duration of the internal 
review stage based on the number of days between the date on the 
application and the date NNSA forwarded the application to the 
interagency. This date marked the beginning of the interagency stage, 
which ended when NNSA received the last interagency concurrence with 
the application package. The final review stage started from the date 
of the last interagency concurrence and ended on the date of the 
Secretary of Energy's determination. To ensure the analysis was as 
accurate as possible, we reviewed the data, identified irregularities, 
and contacted NNSA officials to clarify and correct those 
irregularities. For example, when we noticed an application in which 
the Department of Commerce's concurrence date preceded the date NNSA 
submitted the application to the interagency, we notified NNSA 
officials of this inconsistency, and they provided us with the correct 
date. Moreover, we interviewed the NNSA officials who collected and 
recorded the data, about the procedures they follow to ensure the data 
are accurate, complete, and reliable. On the basis of our review, we 
concluded that the data were sufficiently reliable for purposes of 
analyzing trends in processing times. 

To identify factors affecting the processing times for specific 
authorizations, we selected a nonprobability sample of eight 
applications that represented a range of processing times. 
Specifically, for each stage in the Part 810 process as well as for 
the entire process, we selected (1) one case from among applications 
with short processing times, defined as processing times in the 25th 
percentile (that is, processing times shorter than those for 75 
percent of all applications), and (2) one case representing long 
processing times, defined as applications in the 75th percentile (that 
is, processing times longer than those for 75 percent of all 
applications). Among applications with long processing times, we 
considered those with over twice the median processing time. We used 
the median--rather than the mean--because outliers in the data unduly 
impact the size of the mean, making it a less valid representation of 
the typical processing time. From applications with long and short 
processing times, we selected cases that represented a range of 
countries and types of exports or assistance, such as computer codes, 
consulting services, and advanced reactor technologies. 

The small number of cases selected precluded us from generalizing the 
results, but the case study analysis provided examples of factors that 
may explain the varying processing times. To identify these factors, 
we reviewed application packets NNSA provided to us, including 
technical assessments and intra- and inter-agency correspondence. When 
reviewing case study documents, we noticed that some of the 
correspondence dates differed from the dates recorded in the 
spreadsheet.[Footnote 56] Because these discrepancies are small, they 
do not significantly impact the results of our aggregate data 
analysis, which measures the duration (i.e., number of days) between 
each stage of the process and the overall process. The small 
discrepancies also do not impact the findings of our case study 
analysis, which focuses on the causes of long and short processing 
times. We also interviewed agency officials to better understand these 
factors. For seven of the eight applications in our case study, as 
well as for the three applications that NNSA provided to us as 
samples, we were able to determine, based on the last internal 
concurrence among DOE and NNSA staff, the earliest date that the 
recommendation could have been provided to the Secretary upon receipt 
of interagency comments to determine whether the recommendation was 
provided to the Secretary within 30 days--the target time frame. In 
one case, the correspondence was not dated, and we could not determine 
the date of the recommendation to the Secretary. In nine other cases, 
we were able to determine whether the time elapsed between the receipt 
of interagency comments and the last internal concurrence among DOE 
and NNSA staff--which must precede the recommendation to the 
Secretary--exceeded 30 days. 

To examine the impacts of Part 810 processing times on U.S. nuclear 
exporters, we interviewed representatives of these exporters and 
reviewed public comments submitted in response to DOE's proposed 
changes to Part 810,[Footnote 57] as well as DOE's response to 
comments made in response to the Notice of Proposed Rulemaking, as 
articulated in the preamble to the Supplemental Notice of Proposed 
Rulemaking. The representatives we interviewed included 
representatives of companies, as well as representatives of four 
associations (the Nuclear Energy Institute (NEI), American Nuclear 
Society (ANS), Nuclear Infrastructure Council (NIC), and Association 
of University Export Control Officers (AUECO),[Footnote 58] and 
reviewed the public comments of a fifth (the Ad-Hoc Utilities Group)). 
The companies were either identified through interviews with 
association representatives--we requested that they identify nuclear 
exporters with experience with the Part 810 authorization process for 
us to interview--or by GAO (for example, at public meetings and other 
forums on nuclear export issues, or through their public comments). We 
then interviewed five exporters, including reactor designers and 
manufacturers, engineering service providers, and fuel companies, and 
obtained written comments from a nuclear energy technology company. We 
also selected for interviews, based on recommendations from industry 
associations and on our reviews of public comments and letters, 
representatives from a consulting group that exports nuclear services 
and from a utility company, which is the largest commercial nuclear 
generator in the United States, and from two law firms. The law firms 
were selected because of their expertise and experience in U.S. 
nuclear export controls. To learn more about the relevance of 
regulation of civilian nuclear technology to nonproliferation more 
generally, we interviewed five nonproliferation experts. 

To examine the extent to which the scope of Part 810 is clear, we 
consulted and analyzed the Atomic Energy Act, as well as executive 
orders and Office of Management and Budget bulletins related to 
government regulation. We also reviewed the Part 810 regulation. We 
interviewed DOE officials and a variety of entities regulated or 
potentially regulated under Part 810, as well as various groups 
representing these entities--as described above--for their views on 
the clarity of the regulation. We also consulted public comments 
submitted in response to DOE's proposed changes to Part 810, as well 
as DOE's response to the comments received in response to the Notice 
of Proposed Rulemaking as articulated in the preamble to the 
Supplemental Notice of Proposed Rulemaking. To examine the extent to 
which DOE can reasonably assure that the regulation is consistently 
interpreted, we consulted DOE's 10 C.F.R. Part 810 Assistance to 
Foreign Atomic Energy Activities Part 810 Program Elements and the 
federal standards for internal control,[Footnote 59] and interviewed 
DOE officials and a variety of entities regulated or potentially 
regulated under Part 810, as well as various groups representing these 
entities, as described above. 

To examine the extent to which DOE enforces its nuclear export 
controls, we first determined the activities DOE undertakes to monitor 
conditions imposed through authorizations by interviewing DOE and NNSA 
officials. We then conducted an analysis of the conditions imposed 
through the 89 Part 810 authorizations approved from 2008-2013. The 
conditions for each authorization are documented in determination 
letters signed by the Secretary of Energy, and we conducted a double-
blind content analysis of the 89 letters to determine the range and 
frequency of conditions. Specifically, two analysts independently 
reviewed the 89 letters and recorded the range and frequency of 
conditions in separate documents. Then the analysts compared their 
assessments and resolved any differences through discussion. To 
describe DOE's authorities to enforce these conditions, as well as the 
actions DOE has taken to enforce them, we reviewed the Atomic Energy 
Act and 10 C.F.R. Part 810. We also interviewed DOE, NNSA, Federal 
Bureau of Investigation, and Department of Justice officials and 
obtained information on enforcement actions. To describe the 
information DOE provides on its enforcement of Part 810, we reviewed 
DOE's 10 C.F.R. Part 810 Assistance to Foreign Atomic Energy 
Activities Part 810 Program Elements and interviewed DOE and NNSA 
officials. We also interviewed representatives from entities regulated 
or potentially regulated under Part 810, as described above. To 
determine the information provided by other agencies that administer 
related export control regimes, we reviewed relevant regulations and 
publicly available information on NRC and the Departments of State and 
Commerce's enforcement policies, including enforcement manuals and 
voluntary disclosure guidelines; and interviewed NRC officials. We 
also interviewed two export-control compliance experts, recommended to 
us based on their expertise, and representatives from two law firms 
with expertise and experience in U.S. nuclear export controls. 

We conducted this performance audit from August 2013 to October 2014 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

[End of section] 

Appendix II: Enforcement Tables: 

Tables 5 and 6 contain information on the common conditions imposed on 
specific authorizations for exports of nuclear technology under 10 
C.F.R. Part 810 granted from 2008 through 2013, as well as examples of 
less common conditions. 

Table 5: Conditions Imposed through Specific Authorizations for 18 
Deemed Exports, 2008-2013: 

Common conditions: 

Condition: Ensure that the foreign national maintains a current 
passport and visa; 
Responsibility: U.S. company; 
Frequency: 16 of 18; 
Relevant notes: Two authorizations did not contain this condition. In 
one, the foreign nationals were being employed through a German 
affiliate. The other authorization was for the transfer of technology 
to a company in India, as well as Indian nationals in the company's 
U.S. affiliate. 

Condition: Notify Department of Energy (DOE) promptly upon termination 
or change in immigration status for the foreign national; 
Responsibility: U.S. company; 
Frequency: 17 of 18; 
Relevant notes: The one authorization without this condition was for 
the transfer of technology to a company in India, as well as Indian 
nationals in the company's U.S. affiliate. 

Condition: Submit to DOE for prior approval changes in the foreign 
national's work duties; 
Responsibility: U.S. company; 
Frequency: 17 of 18; 
Relevant notes: The one authorization without this condition was for 
the transfer of technology to a company in India, as well as Indian 
nationals in the company's U.S. affiliate. 

Condition: Report annually to DOE on activities pursued by each 
foreign national under this authorization; 
Responsibility: U.S. company; 
Frequency: 17 of 18; 
Relevant notes: In one case, for the transfer of technology to a 
company in India, as well as Indian nationals in the company's U.S. 
affiliate, the authorization required quarterly reports. 

Condition: Obtain from the foreign national a signed nonproliferation 
or nondisclosure statement; 
Responsibility: U.S. company, foreign national; 
Frequency: 17 of 18; 
Relevant notes: In one case, for the transfer of mixed oxide fuel 
fabrication technology to a South African national, neither a 
nonproliferation statement nor a non-disclosure statement was required. 

Examples of less common conditions: 

Condition: Ensure that the foreign national has access to technology 
governed by Part 810 only through fulfillment of contracts and 
projects described in the authorization; 
Responsibility: U.S. company; 
Frequency: 12 of 18; 
Relevant notes: It appears that DOE meant to include this condition in 
one authorization (not counted in the 12), but omitted the word 
"only," which potentially renders the provision meaningless[A]. 

Condition: Ensure that the foreign national will not access sensitive 
nuclear technology; 
Responsibility: U.S. company; 
Frequency: 3 of 18; 
Relevant notes: These three authorizations involved exports of nuclear 
power plant technology and training tools to either Indian or Chinese 
nationals. 

Condition: Ensure that the foreign national will only have access to 
executable code (i.e., not source code); 
Responsibility: U.S. company; 
Frequency: 3 of 18; 
Relevant notes: The three authorizations pertained to transfers of 
nuclear power plant technology and training tools to either Indian or 
Chinese nationals. 

Source: GAO analysis of DOE information. GAO-15-124. 

Note: We analyzed all authorizations from 2008-2013; the 18 
authorizations for deemed exports were signed in 2010 or later. 

[A] The condition requires that the company ensure that each foreign 
national approved under the authorization be allowed access to the 
nuclear technology described in its application during fulfillment of 
the company's contracts and projects. 

[End of table] 

Table 6: Conditions Imposed through Specific Authorizations for 72 
Technology Exports (Other Than Deemed Exports), 2008-2013: 

Common conditions: 

Condition: Peaceful (non-military or non-explosive) use; 
Responsibility: Importing country, importing company or other entity; 
Frequency: 70 of 72; 
Relevant notes: Two authorizations for exports to China did not 
explicitly contain conditions on peaceful use. However, the 
authorizations stated that the transferred technology would be subject 
to the Agreement for Cooperation between the Government of the United 
States of America and the Government of the People's Republic of China 
Concerning Peaceful Uses of Nuclear Energy of July 23, 1985. This 
agreement provides that transferred technology may not be used for any 
nuclear explosive device, for research specifically on or development 
of any nuclear explosive device, or for any military purpose. 

Condition: Re-export permission required: 
Responsibility: 
Importing country, importing company: 
Frequency: 70 of 72; 
prior written permission: 
Frequency: 42 of 72; 
written permission: 
Frequency: 10 of 72; 
prior permission: 
Frequency: 10of 72; 
prior coordination: 
Frequency: 1 of 72; 
Relevant notes: Two authorizations for exports to China did not 
explicitly contain conditions on re-export. However, the 
authorizations stated that the transferred technology would be subject 
to the Agreement for Cooperation between the Government of the United 
States of America and the Government of the People's Republic of China 
Concerning Peaceful Uses of Nuclear Energy of July 23, 1985. This 
agreement provides that transferred technology may not be 
retransferred outside the parties' boundaries unless the parties 
agree. In one case, an export to Ukraine in 2013, retransfer required 
"prior coordination." 

Condition: Submit for prior DOE approval names of additional companies 
or individuals to which the exporter proposes transferring the 
technology; 
Responsibility: Exporter; 
Frequency: 70 of 72; 
Relevant notes: The two authorizations that did not include this 
condition were for exports to the United Arab Emirates in 2009 and 
2010. 

Condition: Report to DOE on activities conducted under the 
authorization; 
Responsibility: Exporter; 
Frequency: 70 of 72; 
quarterly: 
Frequency: 5 of 72; 
semi-annually: 
Frequency: 19 of 72; 
annually: 
Frequency: 46 of 72; 
Relevant notes: Two authorizations did not contain any explicit 
reporting requirement. One authorization was for an export to Germany 
of specifications and requirements for procuring components, equipment 
and services for construction of a centrifuge plant. The other was for 
an export to China of computer codes. 

Examples of less common conditions: 

Condition: Implement necessary physical protections; 
Responsibility: Importing country, importing company; 
Frequency: 13 of 72; 
Relevant notes: The 13 authorizations with this condition involved 
exports to China (7), Russia (4), Germany (1), and Armenia (1). 

Condition: The identified recipients of the transferred technology are 
authorized to receive the technology; 
Responsibility: Importing country, importing company; 
Frequency: 12 of 72; 
Relevant notes: This condition was imposed for 12 of the 21 
authorizations for exports to China. 

Condition: Prior to any third party transfer, the United States and 
China mutually agree in writing on conditions associated with the 
transfer; 
Responsibility: U.S. government, importing government, importing 
company; 
Frequency: 12 of 72; 
Relevant notes: This condition was imposed for 12 of the 21 
authorizations for exports to China.[A]. 

Condition: In case of possible re-export, the principles stipulated in 
IAEA document INFCIRC/254/Part1 will be applied.[B]; 
Responsibility: Importing country, importing company; 
Frequency: 6 of 72; 
Relevant notes: This condition was imposed in six authorizations for 
exports to Russia. 

Source: GAO analysis of DOE information. GAO-15-124. 

[A] The 12 authorizations that contained this condition are not the 
same 12 authorizations that contained the prior condition requiring 
that the identified recipients of the technology are authorized to 
receive it. 

[B] For example, see INFCIRC/254/Rev.9/Part1, "Communication Received 
from the Permanent Mission of Brazil regarding Certain Member States' 
Guidelines for the Export of Nuclear Material, Equipment and 
Technology," 7 November 2007. This communication lays out the Nuclear 
Suppliers Group (NSG) guidelines. 

[End of table] 

[End of section] 

Appendix III: Comments from the Department of Energy: 

Department of Energy: 
Under Secretary for Nuclear Security: 
Administrator, National Nuclear Security Administration: 
Washington, DC 20585: 

October 3, 2014: 

Mr. David Trimble: 
Director, Natural Resources and Environment: 
U.S. Government Accountability Office: 
Washington, DC 20548: 

Dear Mr. Trimble: 

Thank you for the opportunity to review the Government Accountability 
Office's (GAO) draft report titled, "Nuclear Commerce: Additional 
Actions Needed to Improve DOE's Export Control Process" (GAO-15-124). 
The National Nuclear Security Administration (NNSA) concurs with and 
has already begun addressing all six of the recommendations provided 
in the draft report. In particular, part of our ongoing Process 
Improvement Plan involves working to identify gaps, overlaps, and 
inefficiencies in the Part 810 authorization process. 

The enclosure to this letter provides the specific milestones and 
timelines for addressing each recommendation. We have also provided 
general and technical comments for GAO's consideration to enhance the 
clarity and the factual accuracy of the report. 

If you have any questions regarding this response, please contact Dean 
Childs, Director, Office of Audit Coordination, at (301) 903-1341. 

Sincerely, 

Signed by: 

Frank G. Klotz: 

Enclosure: 

National Nuclear Security Administration: 
Response to Report Recommendations: 

Nuclear Commerce: Additional Actions Needed to Improve DOE's
Export Control Process (GAO-15-124): 

Recommendation 1: Review existing targets for processing Part 810 
applications and determine the extent to which they align with DOE's 
resources and authorities. Based on the results of this review, 
establish realistic and achievable targets for each stage of the
Part 810 process. 

Management Response: Concur. 

As part of our ongoing Process Improvement Plan (PIP), NNSA is working 
to identify gaps, overlaps, and inefficiencies in the Part 810 
authorization process. This effort aims to reduce the amount of time 
required to process an export request application, while maintaining 
the strongest nuclear nonproliferation controls in the interest of 
U.S. national security. As part of the PIP, NNSA will establish new, 
achievable targets for each stage of the Part 810 process. The most 
significant processing delays are caused by long wait times to receive 
the required written nonproliferation assurances from foreign 
governments. While the U.S. Government cannot control how long a 
foreign government takes to provide nonproliferation assurances, NNSA 
has initiated discussions with governments to streamline the process 
where possible. 

In parallel, NNSA is performing a quantitative analysis as a part of a 
Six Sigma-based effort, to improve the quality of process outputs by 
identifying and removing the causes of defects (errors) and minimizing 
variability in business processes. NNSA as a whole, and the Part 810 
team specifically, is working towards ISO 9001 compliance. ISO 9000 is 
a series of standards developed and published by the International 
Organization for Standardization (ISO) that define, establish, and 
maintain an effective quality assurance system for manufacturing and 
service industries. Based upon the outcome of a quantitative analysis 
of the current Part 810 authorization process, NNSA will incorporate, 
where possible, those efficiencies. 

The third prong of the PIP involves a comprehensive study currently 
underway led by industry experts under contract to DOE that will 
result in a report and set of recommendations for improvement to NNSA. 
This study includes interviews with all relevant stakeholders impacted 
by Part 810 including DOEINNSA staff, the U.S. interagency, industry, 
and non-governmental organizations. 

Estimated completion date: We anticipate this effort will be complete 
by June 2015. 

Recommendation 2: Integrate these targets into DOE's new Part 810 e-
licensing system to monitor agency performance against them to ensure 
that the targets remain realistic and achievable and that they improve 
predictability for exporters. 

Management Response: Concur. 

NNSA is in the process of developing an electronic processing system 
("e810 system") and case management web portal for Part 810 
applications that has both internet and intranet components. This 
portal will: (1) help make the Part 810 process ISO 9001 compliant by 
developing a records management function; (2) make the Part 810 
application process easier for applicants to complete; (3) align with 
industry's request for Part 810 procedural reforms; (4) increase 
transparency in the application process to provide more insight into 
the status of each application throughout the review; (5) shorten the 
processing time for Part 810 authorizations; and (6) enable NNSA to 
monitor performance against new target processing times for each stage 
of the Part 810 process. 

For the past year, NNSA has been working with the NNSA Chief 
Information Officer (CIO) to develop in stages, the e810 system. The 
initial phase will allow U.S. companies to submit and track the 
progress of their Part 810 application or request through the e810
system. This will facilitate NNSA coordination with the interagency to 
obtain the requisite concurrence (State Department) and conduct the 
required consultations (Departments of Defense and Commerce, and the 
Nuclear Regulatory Commission). Future phases will focus on 
streamlining the internal, back-end processing and adding 
administrative enhancements to the existing site, including a database 
of previous authorization decisions. 

Estimated completion date: The NNSA CIO's office estimates that the 
e810 system will be available for public use around May 2015. However, 
development will continue, to make the system increasingly more 
sophisticated and helpful. 

Recommendation 3: Determine whether DOE has authority to impose civil 
penalties for Part 810 violations and develop procedures accordingly. 

Management Response: Concur. 

DOE has under active consideration whether the Department has 
statutory authority under section 234 of the Atomic Energy Act (AEA) 
to assess civil penalties for violation of AEA section 57b. and its 
implementing regulations at 10 CFR Part 810. 

Estimated completion date: At the conclusion of the review process, we 
will take any action deemed appropriate. 

Recommendation 4: Develop a risk based procedure for selecting 
exporters' reports on authorized activities for in-depth analysis. 

Management Response: Concur. 

NNSA plans to consult with other regulatory agencies such as the 
Nuclear Regulatory Commission (NRC) to determine what risk-based 
procedures they have in place for analyzing reports on authorized 
activities they receive, if any, and to evaluate whether such a 
process could be modified to work for Part 810 reports. We also intend 
to consult with the DOE Office of Intelligence and Counterintelligence 
to explore collaborate on developing a risk-based assessment tool. If 
we determine it is possible and useful to create such a system, we 
anticipate including this as part of the previously discussed PIP.
We do note that 810 general authorizations already are risk-informed 
and are limited to technology, information, and foreign country 
destinations that the Secretary of Energy already has determined to be 
"non-inimical" to the interest of the United States. 

Estimated completion date: We anticipate determining whether risk-
based procedures should be included in the PIP by December 31, 2014. 

Recommendation 5: Assess the need to establish export compliance 
policies that encourage and reward exporters who self-identify and 
correct violations, and develop guidance to exporters on such policies. 

Management Response: Concur. 

NNSA plans to consult with other regulatory agencies such as the NRC 
and the Department of Commerce to determine what export compliance 
policies they have in place for encouraging and rewarding self-
disclosure and to evaluate whether such a process( es) could be 
modified for Part 810 self-reporting. 

Additionally, for the issuance of the final rule, NNSA has developed a 
strategic plan for outreach and communications. Through digital media, 
face-to-face meetings, and third party partnerships, NNSA will be 
informing the public how we plan to manage the transition to the final 
rule internally, developing guidelines to facilitate understanding of
the final rule, as well as creating channels to answer questions 
promptly. Our main goals with the communications plan are to: 

* Ease the transition to and promote understanding of the final rule; 

* Present a responsive NNSA; 

* Create transparency to allay concerns raised in public comments on 
the proposed Part 810 regulatory amendments; and; 

* Remind industry of its obligation with regard to self-reporting, and 
offer assistance to any company or individual that would like to 
discuss its export compliance program with NNSA. 

NNSA will undertake speaking engagements with the press and industry 
to discuss the regulatory changes, develop and maintain website 
content with updated guidelines and FAQs, and will reach out to those 
affected by the final rule to help them to submit necessary 
information required to be submitted before the expiration of the 
transition period after the final rule becomes effective. Information 
on how to self-report will be included in the FAQs. 

Estimated completion date: We anticipate consulting with the various 
offices by the end of calendar year 2014. While the public roll-out 
for the e81 0 system will likely be around May 2015, we do not 
anticipate that the initial stage of the system will incorporate
a self-reporting mechanism. That will likely be incorporated in 
subsequent modifications in the late 2015-early 2016 time frame. 

Recommendation 6: Ensure that all inquiries about the scope of part 
810, including NNSA's responses, are documented in accordance with 
existing DOE procedures. 

Management Response: Concur. 

The e810 system will be structured so that anyone who applies for 
specific authorization or reports on a general authorization activity 
must register in order to do so. We will encourage registration from 
anyone who comes to the Department with a Part 81O-related question 
for purposes of documentation. NNSA will document (for internal NNSA
purposes, not for public consumption) when there is an inquiry or 
contact from anyone registered on the e810 system, thus ensuring 
memorialization of all contacts. NNSA will continue to consider such 
inquiries "informal." Only written interpretations of the Department's 
General Counsel in response to formal requests, therefore, are binding 
on the Department. 

Estimated completion date: We anticipate the ability to add 
information on inquiries to the files of registered users on the e810 
system to be part of the initial public roll-out of the e81 0 system 
in the May 2015 timeframe. 

General Comments: 

The draft report frequently draws comparisons between the DOE Part 810 
export control regime and the export control regimes of the Nuclear 
Regulatory Commission (NRC), the Department of Commerce (DOC), and the 
Department of State (DOS). Unlike all of the other regimes, DOE's 
export authorization process mandated by section 57b. of the Atomic 
Energy Act (AEA) prescribes the involvement of five different 
executive departments/agencies, and includes diplomatic engagements
with a host of individual foreign governments, whose responsiveness to 
U.S. Government requests for nonproliferation assurances the U.S. 
Government cannot control. Clarification of this point maybe 
beneficial to the average reader of the report. 

DOE guidance must be able to address rapid change in the global civil 
nuclear market. With the global nuclear market expanding 
exponentially. Part 810 requests have become more complicated in 
recent years. There are occasions when we receive a request that 
presents a unique situation, making "consistent" guidance inapplicable.
NNSA is taking steps in the current Part 810 rulemaking to make the 
rule as comprehensive as possible, and aspects of the PIP will provide 
guidance as well. Specifically, the proposed revision, among other 
things, proposes to: conform Part 810 to the Nuclear Suppliers Group 
Guidelines; replace the list of specifically authorized destinations 
with a list of generally authorized destinations (this positive list 
is consistent with the President's export control reform initiative); 
provide a technical description of the activities that are generally 
authorized; clarify the use of the "operational safety" fast track 
approval; identify required information for all specific authorization 
applications; and embody the Department's practice for authorizing 
"deemed exports" of technology to lawful permanent residents of the 
United States and protected individuals under the Immigration and 
Naturalization Act working for U.S. nuclear employers. NNSA believes
that, if adopted, these revisions will address many concerns expressed 
by commenters related to consistency and clarity. However, the ability 
to devise creative solutions for unique and/or new situations remains 
an important aspect of the Part 810 authorization process. 

NNSA is revising the inquiry process. The draft report states (on the 
first page) that DOE has not proposed revising the inquiry process. As 
described below, various aspects of the PIP will address the inquiry 
process and the website will contain both written guidance on 
reporting for general authorizations and applying for specific 
authorizations. Additionally, there will be FAQs and case studies 
(with any identifying or proprietary information redacted). NNSA 
believes that, taken together, these steps will greatly improve the 
inquiry process by reducing the need for potential applicants to contact
NNSA with questions about the Part 810 authorization process. NNSA 
representatives stated this position at public meetings regarding the 
proposed new rule and PIP, which was a 2010 GAO recommendation. The 
Department clearly took seriously the 2010 GAO audit recommendations 
on Part 810, as is evidenced by the current rulemaking, process 
improvement plan, and creation of an e-810 system. 

Additionally, with regard to informal inquiries, the current Part 810 
rule states that only a written interpretation of the Department's 
General Counsel (or an interpretation authorized in writing by the 
Secretary) is binding upon the Department. NNSA staff provides written 
guidance approximately 15 times every month. We believe GAO is 
referring to informal conversations by members of the public with NNSA 
staff, which are generally exploratory in nature. This type of 
interaction with the regulated community is consistent with NRC and 
DOC practice and is in keeping with the best practices of regulatory 
authorities in that it assists with maintaining open lines of 
communication. 

Part 810 authorization enforcement. It is true that NNSA has not 
referred any suspected Part 810 violations to the Department of 
Justice for criminal investigation, or revoked any authorizations for 
cause. However, for clarification NNSA has not received reports of 
illicit technology transfers or seen evidence of companies violating 
Part 810 authorization restrictions. Thus, while we are taking steps 
to evaluate how we can strengthen our administration of Part 810, we 
believe we have been diligent in assuring nuclear technology and 
information are properly controlled. 

[End of section] 

Appendix IV: GAO Contacts and Staff Acknowledgments: 

GAO Contacts: 

David C. Trimble, (202) 512-3841, or trimbled@gao.gov and Thomas 
Melito, (202) 512-9601, or melitot@gao.gov: 

Staff Acknowledgments: 

In addition to the individual named above, Glen Levis (Assistant 
Director), Jeff Phillips (Assistant Director), Alisa Beyninson, 
Antoinette Capaccio, Pamela Davidson, R. Scott Fletcher, Grant Mallie, 
Cynthia Norris, John Rastler, and Jennifer Young made key 
contributions to this report. 

[End of section] 

Footnotes: 

[1] GAO, Nuclear Commerce: Governmentwide Strategy Could Help Increase 
Commercial Benefits from U.S. Nuclear Cooperation Agreements with 
Other Countries, [hyperlink, http://www.gao.gov/products/GAO-11-36] 
(Washington, D.C.: Nov. 4, 2010). 

[2] See [hyperlink, http://www.gao.gov/products/GAO-11-36]. Exports of 
U.S. civilian nuclear technology are regulated under 10 C.F.R. Part 
810, which implements Section 57(b) of the Atomic Energy Act (AEA). 
The National Nuclear Security Administration (NNSA)--a separately 
organized agency within DOE--implements Part 810 through its Office of 
Nonproliferation and International Security. Part 810 applies to 
persons subject to the jurisdiction of the United States who engage 
directly or indirectly in the production of special nuclear material 
outside the United States, or by licensees, contractors or 
subsidiaries under their direction, supervision, responsibility, or 
control. 

[3] Special nuclear material includes plutonium and uranium enriched 
in the isotopes uranium-233 or uranium-235. 

[4] The activities of non-U.S. persons in U.S. nuclear facilities are 
referred to as "deemed exports" because foreign nationals gain access 
to U.S. nuclear technology through such activities. 

[5] Commercial (or civilian) nuclear power activities represent 
"indirect" engagement or participation in the development or 
production of special nuclear material, and may or may not require 
specific authorization under Part 810. According to DOE documents, the 
agency interprets Part 810 broadly to include the provision of 
technology in the form of assistance or services to any nuclear power 
program outside the United States.10 C.F.R. Part 810 includes a list 
of 77 restricted countries, including China, Russia, and India. 

[6] The export of sensitive nuclear technology to any country must 
always be specifically authorized under Part 810. For example, 
enrichment is a sensitive nuclear technology. Enrichment is generally 
defined as the process of increasing the concentration of uranium-235 
from its natural concentration of less than 1 percent so that the 
uranium can be used for fuel in most commercial power reactors (or in 
a nuclear weapon). 

[7] Part 810-authorized activities, such as bids for contracts, may be 
followed by activities that require export licenses from the Nuclear 
Regulatory Commission (NRC), which regulates exports of certain 
nuclear materials and equipment, under 10 C.F.R. Part 110. These 
nuclear materials and equipment include enriched uranium and reactor 
components, which can only be exported via NRC license if there is an 
agreement for civil nuclear cooperation (123 agreement) or a Project 
and Supply Agreement in place with the importing country. 

[8] [hyperlink, http://www.gao.gov/products/GAO-11-36]. 

[9] Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Sept. 30, 1993); 
Exec. Order No. 13,563, 76 Fed. Reg. 3,821 (Jan. 18, 2011). In 
particular, Executive Order 13,563 directs that regulations be 
accessible, consistent, written in plain language, and easy to 
understand. 

[10] Assistance to Foreign Atomic Energy Activities, 78 Fed. Reg. 
46,829 (Aug. 2, 2013) (to be codified at 10 C.F.R. pt. 810). In 
September 2011, DOE issued a Notice of Proposed Rulemaking for Part 
810 (Assistance to Foreign Atomic Energy Activities, 76 Fed. Reg. 
55,278 (Sep. 7, 2011). 

[11] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] ("Green 
Book") (Washington, D.C.: November 1999). 

[12] Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Sept. 30, 1993); 
Exec. Order No. 13,563, 76 Fed. Reg. 3,821 (Jan. 18, 2011). 

[13] NNSA is a separately organized agency within DOE. 

[14] State's concurrence is required under the AEA; DOE must consult 
the other agencies, but their concurrence is not required. 

[15] However, the procedures state that any time period in this stage 
may be extended by the Assistant Secretary for Defense Programs or his 
designee. Under DOE's current organization, which has changed since 
the procedures were last updated, this official is the Deputy 
Administrator for Defense Nuclear Nonproliferation, NNSA. Amendment to 
Procedures Established Pursuant to the Nuclear Nonproliferation Act of 
1978, 49 Fed. Reg. 20,780 (May 16, 1984). 

[16] NSG is a voluntary, nonbinding arrangement among nuclear supplier 
countries. Participating countries undertake a political commitment to 
abide by the goals and principles established by the group. 

[17] In the data that DOE provided to us, on which we based our 
analysis, DOE recorded the date on the application as the start date 
for the initial review stage. However, DOE officials told us that they 
sometimes have to contact applicants to request additional information 
or clarification and do not start reviewing the application until they 
receive all of the required information. In response to GAO inquiries 
about Part 810 processing times in November 2013, DOE began using the 
docket date--the date the initial internal review actually begins--as 
the start date for the initial review stage. 

[18] MOX fuel is a mix of plutonium and uranium oxides. 

[19] Foreign government assurances are not required by the regulation 
or by Section 57(b) of the AEA, but State will not provide its 
concurrence--which is required--without such assurances because it 
views them as meeting several important legal and policy objectives. 
Furthermore, DOE officials have stated that any Secretary of Energy 
would be unwilling to sign an authorization for which State cannot 
provide a foreign government's assurance that the technology would not 
be retransferred or diverted. 

[20] This 810-day interagency review period was the longest, although 
the data that NNSA provided and that we used as the basis of our 
aggregated analysis included an interagency review period of 840 days 
(the application to export fuel specifications to Russia discussed 
below). Because the 840 days include the abeyance period that resulted 
from U.S. policy in response to Russia's actions in Georgia, we are 
considering the 810-day interagency review period for this application 
the longest. 

[21] According to the dates NNSA provided, which we used as the basis 
of our aggregated data analysis, the interagency review accounted for 
840 of the 972 days to process this application. However, those 840 
days include the first final review in August 2008 (before the 
application was held in abeyance) and the entire abeyance period, 
rather than a discrete interagency review period. 

[22] The formal titles of these agreements are the Treaty Between the 
United States of America and the Russian Federation on Measures for 
the Further Reduction and Limitation of Strategic Offensive Arms and 
the Agreement Between the Government of the United States of America 
and the Government of the Russian Federation for Cooperation in the 
Field of Peaceful Uses of Nuclear Energy, respectively. 

[23] Amendment to Procedures Established Pursuant to the Nuclear 
Nonproliferation Act of 1978, 49 Fed. Reg. 20,780 (May 16, 1984). 

[24] 42 U.S.C. §§ 2077(b), 2201(n) (2012). 

[25] According to our analysis of NNSA data, NNSA attributed the 
number of days it held this application in abeyance to the final 
review stage. The final review stage was 634 days and the interagency 
stage was 30 days. 

[26] GAO, National Laboratories: DOE Needs to Improve Oversight of 
Work Performed for Non-DOE Entities, [hyperlink, 
http://www.gao.gov/products/GAO-14-78] (Washington, D.C.: Oct. 25, 
2013); Environmental Justice: EPA Needs to Take Additional Actions to 
Help Ensure Effective Implementation, [hyperlink, 
http://www.gao.gov/products/GAO-12-77] (Washington, D.C.: Oct. 6, 
2011); and Tax Administration: IRS Needs to Further Refine Its Tax 
Filing Season Performance Measures, [hyperlink, 
http://www.gao.gov/products/GAO-03-143] (Washington, D.C.: Nov. 22, 
2002). 

[27] Exec. Order No. 13,450, 72 Fed. Reg. 64, 519 (Nov. 13, 2007). 

[28] NEI's mission includes providing a unified industry voice on the 
global importance of nuclear energy and nuclear technology. NEI has 
over 350 members in 17 countries. 

[29] The ISO 9000 series is a quality management standard developed 
from the collective experience and knowledge of international experts 
who participate in the ISO Technical Committee. These standards are 
based on eight quality management principles, which senior management 
can use as a framework to guide their organizations toward improved 
performance. The quality management principles include, among others, 
customer focus, leadership, continual improvement, and a factual 
approach to decision making. 

[30] Lean Six Sigma is a data-driven approach based on the idea of 
eliminating defects and errors that contribute to losses of time, 
money, opportunities, or business. 

[31] Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Sept. 30, 1993); 
Exec. Order No. 13,563, 76 Fed. Reg. 3,821 (Jan. 18, 2011). As 
previously noted, Executive Order 13,563 directs that regulations be 
accessible, consistent, written in plain language, and easy to 
understand. 

[32] Reactor pressure vessels contain the nuclear fuel in nuclear 
power plants. 

[33] These comments were made on DOE's 2011 proposed revisions to Part 
810, but the definition in question is unchanged from its current 
version. 

[34] NRC provides an "Illustrative List of Nuclear Reactor Equipment 
under NRC Export Licensing Authority" at 10 C.F.R. Part 110 Appendix A. 

[35] Under the regulation, "public information" includes information 
generally available in print or electronic media; libraries, archives, 
and university courses; information that has been presented in open 
meetings; and certain information that has been filed with the United 
States Patent and Trademark Office or which has been made available 
under the Freedom of Information Act. It does not include any 
technical embellishment, enhancement, explanation or interpretation 
which in itself is not public information. 

[36] Specifically, DOE has proposed to replace its definition of 
"public information" with definitions of "publicly available 
information" and "publicly available technology." 

[37] Part 810 specifies that each application shall contain (a) the 
name, address, and citizenship of the applicant, and complete 
disclosure of all real parties in interest; if the applicant is a 
corporation or other legal entity, where it is incorporated or 
organized, the location of its principal office, and the degree of any 
control or ownership by any foreign person or entity; (b) a complete 
description of the proposed activity, including its approximate 
monetary value, the name and location of any facility or project 
involved, the name and address of the person or legal entity for which 
the activity is to be performed, and a detailed description of any 
specific project to which the activity relates; (c) any information 
the applicant may wish to provide concerning the factors the Secretary 
must take into account in considering a grant of specific 
authorization; and (d) designation of any information considered 
proprietary for which public disclosure would cause substantial harm 
to the competitive position of the applicant. 

[38] Office of Management and Budget: Final Bulletin for Agency Good 
Guidance Practices (72 Fed. Reg. 3,432 (Jan. 2007) defines ''guidance 
document'' as an agency statement of general applicability and future 
effect, other than a regulatory action (as defined in Executive Order 
12866, as further amended), that sets forth a policy on a statutory, 
regulatory, or technical issue or an interpretation of a statutory or 
regulatory issue. 

[39] NRC provides an "Illustrative List of Nuclear Reactor Equipment 
under NRC Export Licensing Authority" at 10 C.F.R. Part 110 Appendix 
A. Commerce maintains the Commerce Control List, which describes the 
characteristics and capabilities of the dual-use items and certain 
military items that may require export licenses at 15 C.F.R. Part 774 
Supplement 1, and the agency also provides an online list of 
frequently asked questions. 

[40] Specifically, 10 C.F.R. § 810.5 provides that, "A person may 
request the advice of the Director, Nuclear Transfer and Supplier 
Policy Division (NN-43), on whether a proposed activity falls outside 
the scope of this part, is generally authorized under § 810.7, or 
requires specific authorization under § 810.8; however, unless 
authorized by the Secretary of Energy, in writing, no interpretation 
of the regulations in this part other than a written interpretation by 
the General Counsel is binding upon the Department. When advice is 
requested from the Director, Nuclear Transfer and Supplier Policy 
Division, or a binding, written determination is requested from the 
General Counsel, a response normally will be made within 30 days and, 
if this is not feasible, an interim response will explain the delay." 
However, there is no requirement that inquiries be handled formally. 

[41] If companies have determined that their items are Commerce-
controlled but are uncertain of export licensing requirements, they 
may request a classification from Commerce through the commodity 
classification process. Commerce can refer classification requests to 
State and DOD to confirm that the items are Commerce-controlled. If 
companies are unsure of which department has jurisdiction over their 
items, they can request a determination through the commodity 
jurisdiction process from State, which consults with Commerce and 
Defense. For more information, please see GAO, Export Controls: 
Processes for Determining Proper Control of Defense-Related Items Need 
Improvement, [hyperlink, http://www.gao.gov/products/GAO-02-996], 
(Washington, D.C.: Sept. 20, 2002). 

[42] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]. 

[43] GAO, Federal Workforce: Recent Trends in Federal Civilian 
Employment and Compensation, [hyperlink, 
http://www.gao.gov/products/GAO-14-215] (Washington, D.C.: Jan. 29, 
2014). 

[44] Assistance to Foreign Atomic Energy Activities. 78 Fed. Reg. 
46,829 (Aug. 2, 2013). 

[45] The definition of "nuclear reactor" in DOE's proposed rule is the 
same as that in the current rule. DOE's proposed rule does not change 
the definition or clarify it with an illustrative list. The final 
rule, which has not yet been issued, may differ from the proposed 
rule, and DOE has not communicated its content to us. 

[46] Sensitive nuclear technology is any information that is not 
available to the public and is important to the design, construction, 
fabrication, operation, or maintenance of a uranium enrichment or 
nuclear fuel reprocessing facility or a facility for the production of 
heavy water. 

[47] For some categories of generally authorized exports, such as 
furnishing public information as defined in the regulation, there are 
no reporting requirements. 

[48] Part 810 requires reports submitted for general authorizations to 
include the following elements: (1) the name, address, and citizenship 
of the person submitting the report; (2) the name, address, and 
citizenship of the person or entity for which the activity is being 
performed; and (3) a description of the activity, the date it began, 
its location, status, and anticipated date of completion. 

[49] Part 810 requires reports submitted for specific authorizations 
to include the same elements we described for generally authorized 
exports, with the addition of a copy of DOE's letter authorizing the 
activity. 

[50] Officials from DOE's Office of General Counsel initially told us 
that the AEA provision for civil penalties regarding violations of 
Section 57--which authorize the imposition of a civil penalty of no 
more than $100,000 for each violation--applied to violations of 
Section 57(b) and thus Part 810. However, DOE officials later told us 
that they were uncertain whether the Department had authority under 
the AEA to impose civil penalties, because the matter had not come up 
prior to their receipt of portions of our draft report. DOE officials 
also said that they were uncertain of when they may determine whether 
the Department has this authority. 

[51] GAO, Civil Penalties: Agencies Unable to Fully Adjust Penalties 
for Inflation Under Current Law, [hyperlink, 
http://www.gao.gov/products/GAO-03-409] (Washington, D.C.: Mar.14, 
2003). 

[52] The International Traffic in Arms Regulations (ITAR) provide that 
the Department of State may impose civil penalties for violations of 
the ITAR. As discussed above, DOE has not determined whether it has 
the legal authority to impose civil penalties for violations of Part 
810. In 2013, the ITAR was revised so as not to apply to certain 
nuclear-related items to the extent that they are under the export 
control of the Department of Energy or the Nuclear Regulatory 
Commission. To the extent that those items were previously controlled 
by the Department of State and are now controlled by the Department of 
Energy, they were moved from a system with clear administrative 
enforcement authority to one without such clear authority. 

[53] An example of a non-willful violation, according to DOE 
officials, is an employee inadvertently leaving export-controlled 
material in open places where non-U.S. persons may access them. 

[54] "Amendment to Procedures Established Pursuant to the Nuclear 
Nonproliferation Act of 1978." 49 Fed. Reg. 20,780 (May 16, 1984). 

[55] Our analysis excluded one application that DOE approved in 2008, 
because that application preceded DOE's electronic data collection 
system on which we based our aggregate data analysis. 

[56] In seven cases, the dates in the aggregate data NNSA provided to 
GAO for applications processed from 2008-2013, on which we based our 
aggregate data analysis, differed from the dates on formal and 
informal correspondence, on which we based our case study analyses. 

[57] We reviewed all public comments submitted on [hyperlink, 
http://www.regulations.gov] in response to the proposed rule changes. 
We conducted a double-blind content analysis of the 75 comments 
submitted to identify those pertinent to the scope of our work. We 
used the public comments to provide illustrative examples (and to 
identify additional exporters to interview). We did not analyze the 
contents of the comments to quantify exporter views on the regulation. 

[58] AUECO representatives are university export control officers. 

[59] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] 
("Green Book") (Washington, D.C.: November 1999). 

[End of section] 

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