NNSA Issues Part 810 Report to Congress for FY 2020

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Morgan Lewis - Up & Atom

The US Department of Energy’s National Nuclear Security Administration (NNSA) has submitted its annual report on Transfers of Civil Nuclear Technology to Congress for fiscal year (FY) 2020. The report fulfills the agency’s obligation under Section 3136(e) of the National Defense Authorization Act for Fiscal Year 2016 to submit an annual report covering its review of applications under 10 CFR Part 810 to transfer US civil nuclear technology to foreign persons. Morgan Lewis tracks these annual reports; see link to our full analysis of the prior report (for FY 2019).

FY 2019 Report – Recap

In FY 2019, NNSA received 36 applications for specific authorization. It closed out 48 applications for specific authorizations, including 24 applications approved by the Secretary, four applications denied by the Secretary, 15 applications withdrawn by the applicant, and five applications returned to the applicant without action. It also reviewed more than 600 reports on generally authorized activities and more than 75 reports on specifically authorized activities. The Secretary did not delegate approval of any applications in FY 2019.

Although there was an overall reduction in average approval times for specific authorizations, it was unclear what part of the reduction was the result of agency-implemented efficiencies as opposed to an increase in deemed export applications vs. all others. Although it is likely that agency-implemented efficiencies contributed to a reduction in review times, more transparency (i.e., inclusion of additional metrics in the report) would have been helpful.

FY 2020 Report

In FY 2020, NNSA received and acted on fewer applications, likely as a result of the COVID-19 pandemic. NNSA received 30 applications for specific authorization (six fewer than FY 2019). It closed out 30 applications for specific authorization (18 fewer than FY 2019), including 15 specific authorizations approved by the Secretary, four applications denied by the Secretary, 10 applications withdrawn at the request of the applicant, and one application returned to the applicant without action. It also reviewed 568 reports on generally authorized activities (32 fewer than FY 2019) and 60 reports on specifically authorized activities (15 fewer than FY 2019). As in FY 2019, the Secretary did not delegate approval of any Part 810 authorizations during FY 2020. Likewise, the average review time for specific authorizations was nine months – the same as the average review time during FY 2019.

Notably, NNSA reported trickle-down delays in processing time as a result of the COVID-19 pandemic. For example, the Office of the Director of National Intelligence (ODNI) must review applications for specific authorizations to certain destinations, including to China and Russia. NNSA reported that, because ODNI experienced COVID-19-related delays, NNSA was also affected because NNSA can only make recommendations to the Secretary on applications for specific authorization to China and Russia following ODNI review. Consequently, because ODNI was delayed, NNSA was also delayed. NNSA reported that it is “working with ODNI and other U.S. Government agencies to address [the delays], with the goal of completing all reviews within” 30 business days.

If not for the delays in ODNI response times, it is likely that the NNSA’s review times would have been shorter in FY 2020 than in FY 2019. The fact that the average review time in FY 2020 was the same as in FY 2019 although the last half of FY 2020 was affected by the pandemic is an impressive feat considering the disruptions the pandemic caused. We are hopeful that the slow return towards normal in FY 2021 will show even better Part 810 processing times, although that may be offset by a handful of recent personnel changes within NNSA’s Part 810 office. As we concluded for FY 2019, more transparency to the report (i.e., the inclusion of additional metrics) would be useful to better understand the data, and better demonstrate to all stakeholders the progress that NNSA is making with Part 810 review times.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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