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Highlights

Pursuant to a congressional request, GAO reviewed U.S. export licensing procedures for dual-use nuclear items, focusing on the: (1) nature and extent of U.S. nuclear-related dual-use exports to countries of proliferation concern; (2) policies and procedures for reviewing export license applications; and (3) methods used to deter and detect the diversion of exports to foreign nuclear proliferation programs.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Commerce To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce and Energy should provide periodic reports to SNEC on those nuclear-related dual-use licenses approved without interagency review.
Closed - Implemented
Commerce has changed its procedures to require that all dual-use nuclear licenses be forwarded to the Department of Energy for review. In addition, forthcoming regulations are intended to ensure that all agencies will have the ability to review any such license applications. This should, when implemented, provide access by all SNEC agencies to license information as envisioned by GAO's recommendation.
Department of Energy To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce and Energy should provide periodic reports to SNEC on those nuclear-related dual-use licenses approved without interagency review.
Closed - Implemented
Commerce has changed its procedures to require that all dual-use nuclear licenses be forwarded to the Department of Energy for review. In addition, forthcoming regulations are intended to ensure that all agencies will have the ability to review any such license applications. This should, when implemented, provide access by all SNEC agencies to license information as envisioned by GAO's recommendation.
Department of Commerce To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce, Energy, State, and Defense and the Director, Arms Control and Disarmament Agency, should use licensing information contained in the periodic reports to SNEC to establish mutually acceptable guidelines for selection of licenses for interagency review.
Closed - Not Implemented
According to a State Department representative, SNEC does not plan to establish guidelines for selection of licenses for interagency review, primarily because forthcoming regulations will ensure that dual-use nuclear license applications will be provided to all SNEC agencies, which already have the authority to place applications on the SNEC agenda. These regulations, if issued, should satisfy the underlying intent of GAO's recommendation.
Department of Defense To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce, Energy, State, and Defense and the Director, Arms Control and Disarmament Agency, should use licensing information contained in the periodic reports to SNEC to establish mutually acceptable guidelines for selection of licenses for interagency review.
Closed - Not Implemented
According to a State Department representative, SNEC does not plan to establish guidelines for selection of licenses for interagency review, primarily because forthcoming regulations will ensure that dual-use nuclear license applications will be provided to all SNEC agencies, which already have the authority to place applications on the SNEC agenda. These regulations, if issued, should satisfy the underlying intent of GAO's recommendation.
Department of Energy To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce, Energy, State, and Defense and the Director, Arms Control and Disarmament Agency, should use licensing information contained in the periodic reports to SNEC to establish mutually acceptable guidelines for selection of licenses for interagency review.
Closed - Not Implemented
According to a State Department representative, SNEC does not plan to establish guidelines for selection of licenses for interagency review, primarily because forthcoming regulations will ensure that dual-use nuclear license applications will be provided to all SNEC agencies, which already have the authority to place applications on the SNEC agenda. These regulations, if issued, should satisfy the underlying intent of GAO's recommendation.
Department of State To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce, Energy, State, and Defense and the Director, Arms Control and Disarmament Agency, should use licensing information contained in the periodic reports to SNEC to establish mutually acceptable guidelines for selection of licenses for interagency review.
Closed - Not Implemented
According to a State Department representative, SNEC does not plan to establish guidelines for selection of licenses for interagency review, primarily because forthcoming regulations will ensure that dual-use nuclear license applications will be provided to all SNEC agencies, which already have the authority to place applications on the SNEC agenda. These regulations, if issued, should satisfy the underlying intent of GAO's recommendation.
United States Arms Control and Disarmament Agency To ensure that the most sensitive licenses are referred to SNEC, the Secretaries of Commerce, Energy, State, and Defense and the Director, Arms Control and Disarmament Agency, should use licensing information contained in the periodic reports to SNEC to establish mutually acceptable guidelines for selection of licenses for interagency review.
Closed - Not Implemented
According to a State Department representative, SNEC does not plan to establish guidelines for selection of licenses for interagency review, primarily because forthcoming regulations will ensure that dual-use nuclear license applications will be provided to all SNEC agencies, which already have the authority to place applications on the SNEC agenda. These regulations, if issued, should satisfy the underlying intent of GAO's recommendation.
Department of Commerce To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should focus selection of PLC and PSV by developing lists that: (1) prioritize the most technically sensitive nuclear-related dual use items; and (2) identify end users whose proliferation credentials are already established.
Closed - Implemented
DOE has provided Commerce a list of items that should receive priority for PLC and PSV. This list is being forwarded to those employees screening licenses to assist in selection of candidates for the checks. Updates to the end-user watch list will be made as appropriate.
Department of Energy To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should focus selection of PLC and PSV by developing lists that: (1) prioritize the most technically sensitive nuclear-related dual use items; and (2) identify end users whose proliferation credentials are already established.
Closed - Implemented
DOE has provided Commerce a list of items that should receive priority for PLCs and PSVs. This list is being forwarded to those employees screening licenses to assist in selection of candidates for the checks. Updates to the end-user watch list will be made as appropriate.
Department of Commerce To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should develop specific guidance for U.S. embassy officials on how to conduct inspections for nuclear-related dual use items and require nuclear nonproliferation training for those conducting PLC and PSV.
Closed - Implemented
Commerce is developing an update to its check guidance to include specific guidance on conducting nuclear-related PLC and PSV, and Commerce officials are training embassy staff on proliferation controls.
Department of Energy To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should develop specific guidance for U.S. embassy officials on how to conduct inspections for nuclear-related dual use items and require nuclear nonproliferation training for those conducting PLC and PSV.
Closed - Implemented
Commerce is developing an update to its check guidance to include specific guidance on conducting nuclear-related PLC and PSV, and Commerce officials are training embassy staff on proliferation controls.
Department of Commerce To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should direct that requests for PLC and PSV explain why the inspection is being requested and highlight special licensing conditions.
Closed - Implemented
Commerce has provided instructions to all pertinent units to include the reason for a PLC/PSV request in the cable to the post. Instructions have also been issued directing that any PSV requests include all licensing conditions.
Department of Energy To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should direct that requests for PLC and PSV explain why the inspection is being requested and highlight special licensing conditions.
Closed - Implemented
Commerce has provided instructions to all pertinent units to include the reason for a PLC/PSV request in the cable to the post. Instructions have also been issued directing that any PSV requests include all licensing conditions.
Department of Commerce To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should eliminate U.S. reliance on foreign service nationals to perform nuclear-related dual-use PLC and PSV.
Closed - Implemented
Commerce issued instructions in April 1995 stipulating that foreign service nationals are not to conduct checks on proliferation-controlled items when their country is the focus of these controls.
Department of Energy To enhance the effectiveness of PLC and PSV for nuclear-related dual-use exports, the Secretary of Commerce, in consultation with the Secretary of Energy, should eliminate U.S. reliance on foreign service nationals to perform nuclear-related dual-use PLC and PSV.
Closed - Implemented
Commerce issued instructions in April 1995 stipulating that foreign service nationals are not to conduct checks on proliferation-controlled items when their country is the focus of these controls.
Department of Energy The Secretary of Energy should reach an agreement with the Secretary of Commerce on guidelines for referral of licenses involving end users on the Nuclear Proliferation Watch List.
Closed - Implemented
The Departments of Commerce and Energy reached agreement in June 1994 on guidelines for referral of dual-use nuclear-related items.

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