United States Nuclear Regulatory Commission - Protecting People and the Environment

10 CFR 40.14 is Not to be Used for Issuing Exemption Licenses

HPPOS-135 PDR-9111210361

See the letter from G. H. Cunningham to R. N. Fleck (Assistant Counsel, Union Oil Company of California) dated June 18, 1981.

The letter expresses the OELD opinion that as a matter of policy, the NRC will not use 10 CFR 40.14 to authorize exemptions from requirements to obtain a license. 10 CFR 40.14 has never been used to exempt from classification as source material rare earth mixtures in excess of 0.25% by weight thorium. The NRC was asked how the limit used as the basis for the exemption "0.25 percent by weight thorium, uranium, or any combination of these, ..." was obtained. The exemption in the regulations was based on the statutory exemption for unimportant quantities of source material contained in Section 62 of the Atomic Energy Act of 1954, as amended (42 U.S.C. 2092) which reads in part as follows: "Unless authorized by a general or specific license issued by the Commission, which the Commission is hereby authorized to issue, no person may transfer or receive in interstate commerce, transfer, deliver, receive possession of or title to, or import into or export from the United States any source material after removal from its place of deposit in nature, except that licenses shall not be required for quantities of source material which, in the opinion of the commission, are unimportant." In carrying out its regulatory responsibilities, the NRC, like its predecessor the AEC, has consistently followed the practice of implementing the licensing requirements imposed by the Atomic Energy Act, including any statutory exemptions from those requirements, by promulgating regulations. The statutory exemption for unimportant quantities of source materials was implemented in 10 CFR 40.13 of the Commission's regulations.

The exemption for certain rare earth metals and compounds, mixtures, and products was originally established by the AEC on March 31, 1947, when the Commission's regulations on the "Control of Source Material" became effective. At that time, the basis for the exemption was that the quantity of source material present in the exempted materials was not of significance to the common defense and security. In response to a petition by American Potash and Chemical Corporation, the AEC reconsidered the exemption in March, 1961. At that time, the AEC was aware that rare earth fluorides and rare earth oxides containing approximately 0.2% thorium were used in the manufacture of arc carbons. The AEC was also aware that the rare earth material appearing in consumer products was on the order of 0.19% thorium by weight. On the basis of this and other information, the AEC concluded that the rare earth exemption, with the value of 0.25% by weight thorium, uranium, or any combination of the two, involved unimportant quantities of source material within the meaning of Section 62 of the Atomic Energy Act and should be re-established in the regulations.

The NRC was also asked whether the Commission had ever exercised its discretion under 10 CFR 40.14 to exempt from classification as source materials any rare earth mixtures that contained somewhat in excess of 0.25% by weight thorium. Both the Commission and its predecessor, the AEC, have taken the position that, as a matter of policy, 10 CFR 40.14 procedures will not be used to authorize exemptions from the basic requirement to obtain a license. Under the Commission's present regulations, a source material license is required whenever a rare earth metal, compound, mixture, or product contains 0.25% or more by weight thorium, uranium or any combination of these. There have been no instances in which 10 CFR 40.14 has been used to specifically exempt from classification as source material any rare earth mixture containing thorium in excess of 0.25% by weight.

Regulatory references: 10 CFR 40.13, 10 CFR 40.14

Subject codes: 3.3, 11.1, 12.19

Applicability: Source Material

Page Last Reviewed/Updated Friday, June 12, 2015