United States Nuclear Regulatory Commission - Protecting People and the Environment

Implementation of Policy and Guidance Directive FC 86-2, Revision 1, "Processing Material License Applications Involving Change of Ownership"

HPPOS-257 PDR-9306070100

See the memorandum from J. E. Glenn to C. J. Holloway dated August 18, 1989, and the enclosed Policy and Guidance Directive, FC 86-2, Rev. 1.

This guidance document changed NMSS policy regarding the issuance of new licenses because of change of ownership of licensed facilities. The new policy states that only an amendment is necessary to reflect the change in identity of the licensee in such a case. HPPOS-124 contains a related topic.

10 CFR Part 30, Section 30.34 (b) states: "No license issued or granted pursuant to the regulations in this part and Parts 31 through 35, nor any right under a license shall be transferred, assigned or in any manner disposed of, either voluntary or involuntary, directly or indirectly, through transfer of control of any license to any person, unless the Commission shall, after securing full information, find that the transfer is in accordance with the provisions of the Act and shall give its consent in writing."

Similar regulations are contained in 10 CFR Sections 40.46 and 70.36. Thus, the regulations are very clear that the control of licenses cannot be transferred without written permission from the Commission. The burden of adhering to this requirement is on the transferor; however, it may be necessary for the transferee to provide supporting information. The transferor is an NRC licensee that is selling or otherwise giving up control of a licensed operation, and the transferee is an organization that is proposing purchase or otherwise gaining control of an NRC-licensed operation.

FC 86-2, Rev. 1, changed NMSS policy regarding the issuance of new licenses because of change of ownership of licensed facilities. Previous policy required, in part, that a new license be issued if the transferor would remain in business as a separate entity. The new policy state that only an amendment is necessary to reflect the change in identity of the licensee to a transferee in such a case.

This policy reflects the appropriate level of review to assure that health and safety issues are resolved. However, there will be times when for NRC's administrative purposes a new license number will need to be issued. The middle five digits of a byproduct license are referred to as an institution code. The institution code identifies both the licensed entity and a site of operations. Several licenses may be issued using the same institution code. The use of the same institution code for two separate and currently existing entities would defeat the usefulness of this administrative system.

Therefore, NMSS and the Regions will sometimes be issuing new license numbers (institution codes) for licensing actions which, in fact, are amendments to an existing license. There will be no increase in the technical review. The License Tracking System will only permit such an action to be treated as an issuance of a new license. A fee for an amendment rather than a fee for a new license will be charged in those instances where NMSS or the Regions issue a new license for administrative purpose only. This will save time of both are respective staffs that would otherwise be required to approve these as exceptions on a case-by-case basis.

Regulatory references: 10 CFR 30.34, 10 CFR 40.46, 10 CFR 70.36

Subject codes: 3.5, 11.2, 11.6, 11.7

Applicability: All

Page Last Reviewed/Updated Tuesday, June 30, 2015