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The U.S. Atomic Energy Act Section 123 At a Glance
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Contacts: Daryl Kimball, Executive Director, (202) 463-8270 x107; Kingston ReifDirector for Disarmament and Threat Reduction Policy, (202) 463-8270 x104

Updated: February 2019

Section 123 of the U.S. Atomic Energy Act (AEA) of 1954 establishes the conditions and outlines the process for major nuclear cooperation between the United States and other countries. In order for a country to enter into such an agreement with the United States, that country must commit to a set of nine nonproliferation criteria. As of January 15, 2019, the United States has entered into 26 nuclear cooperation agreements that govern nuclear cooperation with 49 countries, the International Atomic Energy Agency (IAEA) and Taiwan. 

The nine nonproliferation criteria for section 123 agreements are as follows:

  • Nuclear material and equipment transferred to the country must remain under safeguards in perpetuity.
  • Non-nuclear-weapon states partners must have full-scope IAEA safeguards, essentially covering all major nuclear facilities.
  • A guarantee that transferred nuclear material, equipment, and technology will not have any role in nuclear weapons development or any other military purpose, except in the case of cooperation with nuclear-weapon states.
  • In the event that a non-nuclear-weapon state partner detonates a nuclear device using nuclear material produced or violates an IAEA safeguards agreement, the United States has the right to demand the return of any transfers.
  • U.S. consent is required for any re-transfer of material or classified data.
  • Nuclear material transferred or produced as a result of the agreement is subject to adequate physical security.
  • U.S. prior consent rights to the enrichment or reprocessing of nuclear material obtained or produced as a result of the agreement.
  • Prior U.S. approval is required for highly-enriched uranium (HEU) and plutonium obtained or produced as a result of the agreement.  An agreement permitting enrichment and reprocessing (ENR) using U.S. provided material requires separate negotiation.
  • The above nonproliferation criteria apply to all nuclear material or nuclear facilities produced or constructed as a result of the agreement.

Section 123 requires that the Department of State submit a Nuclear Proliferation Assessment Statement (NPAS) explaining how the nuclear cooperation agreement meets these nonproliferation conditions. Congress has a total of 90 days in continuous session to consider the agreement, after which it automatically becomes law unless Congress adopts a joint resolution opposing it.

The President may exempt a proposed agreement from any of the above criteria upon determination maintaining such a criteria would be “seriously prejudicial to the achievement of U.S. non-proliferation objectives or otherwise jeopardize the common defense of the United States.” Exempted 123 agreements would then go through a different process than non-exempt agreements, requiring a congressional joint resolution approving the agreement for it to become law. There are no 123 agreements in force that were adopted with such exemptions.

In 2006, Congress passed the Henry J. Hyde United States-India Peaceful Atomic Energy Cooperation Act which amended the AEA to permit nuclear cooperation with India, a country which is not a member of the nuclear Nonproliferation Treaty (NPT) and does not maintain full-scope safeguards. The Hyde amendment has been criticized for undermining U.S. international counterproliferation efforts. The 40-year 123 agreement with India came into force in December 2008.

Most recently, under the Obama administration, the United States negotiated new agreements with the United Arab Emirates in 2009 and Vietnam in 2014 and negotiated new agreements to replace existing ones with Australia in 2010, Taiwan in 2013, China and South Korea in 2015, and Norway in 2016.

The Trump administration submitted signed new 123 agreements with Mexico and the United Kingdom to Congress in May 2018. The United Kingdom was previously covered under the U.S.-European Atomic Energy Community (EURATOM) 123 agreement, but after the UK withdraws from the European Union, the bilateral agreement between the U.S. and the EU will take effect. Japan’s agreement technically expired in 2018, but renewal terms dictate that the agreement shall remain in force until terminated by a party.

The Trump administration is currently negotiating a 123 agreement with Saudi Arabia. The next agreement which will expire without renewal terms in place (which could trigger an easier automatic renewal without the need to renegotiate or resubmit the agreement to Congress) will be with Egypt in December 2021.

For more information on individual agreements, see the "Nuclear Cooperation with Other Countries: A Primer," by the Congressional Research Service.

The "Gold Standard"

A 123 agreement alone does not permit countries to enrich or reprocess nuclear material acquired from the United States and permission to do so requires a further negotiated agreement.  A debate is currently underway in the nonproliferation community over the “gold standard,” named after the U.S.-UAE 123 agreement signed in 2009 whereby the United Arab Emirates (UAE) voluntarily renounced pursuing enrichment and reprocessing (ENR) technologies and capabilities.  The UAE agreement stands in stark contrast to the “blanket consent” granted to India, Japan, and EURATOM, who have ENR approval from the United States. 

ENR capabilities are controversial because the process transforms raw uranium into highly enriched uranium or spent nuclear fuel into weapons-grade plutonium. While these capabilities are generally used for energy purposes, there are concerns of serious proliferation risks when a country obtains the technology because the same technology can be used to make nuclear weapons. Gold standard provisions for 123 agreements would require any state-party to a 123 agreement with the United States to renounce ENR activities. The Department of Energy and the U.S. nuclear industry advocate a continuance of the case-by-case approach followed thus far in renewal agreements. A case-by-case approach allows countries to apply for ENR permission, and has been successfully pursued by India and Japan.

The George W. Bush administration coined the term "gold standard" when the U.S.-UAE deal was signed in 2009 and declared it the new standard for nuclear cooperation agreements.  The Obama administration did not explicitly come out in favor of gold standard provisions, though there were several interagency reviews soliciting opinions, including during the summer of 2012.  A 2011 letter from the Obama administration to Capitol Hill renounced the idea of a uniform approach to 123 agreements and advocated for a case-by-case approach in future negotiations.  (See ACT, March 2012). The Trump administration has been even less clear on their position regarding gold standard provisions. This has been particularly prevalent in the ongoing negotiations on a Saudi Arabia 123 agreement.

Ongoing Saudi Negotiations and Congressional Actions

The Trump administration began formal negotiations on a 123 agreement with Saudi Arabia in February 2018. The administration has not yet decided if it will insist that a Saudi 123 agreement adhere to the Gold Standard.

Congress has shown bipartisan support for both encouraging gold standard provisions and a more active role for Congress in overseeing both the ongoing negotiations with Saudi Arabia specifically, and 123 agreement more broadly. After the murder of Khashoggi, Republican Sens. Marco Rubio (Fla.), Todd Young (Ind.), Cory Gardner (Colo.), Rand Paul (Ky.), and Dean Heller (Nev.) wrote to Trump on Oct. 31 urging that he suspend negotiations on a cooperation accord, “for the foreseeable future.” They noted that their prior reservations, given Saudi unwillingness to accept the “gold standard”, have been “solidified” in light of the Khashoggi murder, as well as “certain Saudi actions related to Yemen and Lebanon.” Sen. Ed Markey (D-Mass.) sent his own letter on the same day going further to encourage the administration to revoke current “Part 810” authorizations allowing the transfer of some nuclear services and technology between Saudi Arabia and the United States.

In the last Congress, current Chairman of the House Foreign Affairs Committee’s nonproliferation subcommittee Rep. Brad Sherman (D-Calif.) introduced bipartisan and bicameral legislation (the “No Nuclear Weapons for Saudi Arabia Act of 2018”) which would require a joint resolution from Congress to approve a civil nuclear cooperation agreement with Saudi Arabia after various reporting requirements, and the bipartisan “Nuclear Cooperation Agreements Reform Act of 2018” which would amend the AEA to require congressional approval of any 123 agreement.

On Feb. 19, the House Oversight Committee’s majority staff released an interim staff report citing National Security Council staff whistleblowers who were increasingly alarmed at the White House’s “rushed” approach with potential “legal violations” and “conflicts of interest” among senior administration officials with regard to the nuclear negotiations with Saudi Arabia

Posted: July 25, 2018