Legal Eye: Radioactive regulations

"The supply of (radioactive) ore, source materials and special fissile materials should be ensured, by means of a common supply policy based on the principal of equal access to source of supply"

Art. 52 Euratom Treaty

At the beginning of 2005 Poland's nuclear-power debate took on new meaning following the adoption of a new energy strategy by the Council of Ministers, which calls for the development of nuclear energy in Poland by 2020. The construction and operation of nuclear power plants in Poland will, of course, be subject to EU regulations, which are based upon the Treaty Establishing the European Atomic Energy Community (Euratom), to which Poland and other member states are signatories.

What is Euratom?

Established in 1957 in Rome by Belgium, France, Germany, Italy, Luxembourg and the Netherlands, Euratom has grown in tandem with the EU, while preserving a separate  legal identity, even though it is administered by the same institutions. Euratom facilitates the development of nuclear power by regulating the availability of nuclear material for civilian use.

Exclusive powers

The Euratom Supply Agency, established in 1960, has exclusive power to regulate the sale and transfer of ore, source materials (natural uranium) and special fissile materials (enriched uranium and plutonium) within the EU. In other words the Supply Agency, and not individual nuclear power plants or member states, retains the exclusive right to execute supply contracts with third-party suppliers located both inside and outside the EU. In practice, an end-user, such as a nuclear power plant, will negotiate the terms of a supply contract with the producer, such as a mining operator located in Saskatchewan, Canada (Canada and Australia produce more than half the world's uranium). Once both sides have reached agreement, however, the Supply Agency will actually sign as the purchaser.

Member states retain other powers, including but not limited to those related to disposal and storage of radioactive materials and operational safety of nuclear facilities.

Right of first refusal

Additionally, the Supply Agency retains the right of first refusal to purchase all ores, source and fissile materials mined or produced in the EU. All EU-based producers are required to grant the Supply Agency an option to purchase all ores or materials prior to offering them to the market. This is to ensure that all end-users have equal access to nuclear fuel. The Supply Agency may choose not to exercise this right in the event that the supply of material in the EU is sufficient to satisfy demand, in which case a third-party buyer may acquire all ownership rights with respect to ores and source materials. With regard to fissile materials (enriched uranium and plutonium), however, the buyer may purchase the right to "use and consume," while the Supply Agency will retain actual ownership.

Enforcement

More than 300 inspectors are employed to ensure compliance with Euratom. A violation, including the misuse of nuclear materials or the failure to grant the Supply Agency the right of first refusal or to give notice of a pending sale, is punishable by issuance of a warning, withdrawal of financial assistance, administrative supervision or the imposition of restrictions on access to nuclear materials by the offending party, depending on the severity of the violation.

Paul Fogo is a senior attorney with Miller, Canfield, W Babicki & Partners