United States Nuclear Regulatory Commission - Protecting People and the Environment

Information Notice No. 91-39: Compliance with 10 CFR Part 21, "Reporting Of Defects And Noncompliance"

                                UNITED STATES
                        NUCLEAR REGULATORY COMMISSION
              OFFICE OF NUCLEAR MATERIAL SAFETY AND SAFEGUARDS
                           WASHINGTON, D.C.  20555

                                June 17, 1991


Information Notice No. 91-39:  COMPLIANCE WITH 10 CFR PART 21, 
                                   "REPORTING OF DEFECTS AND NONCOMPLIANCE"

Addressees:  

All Nuclear Regulatory Commission (NRC) material licensees. 

Purpose: 

The purpose of this notice is to remind licensees of the requirements 
contained in 10 CFR Part 21, "Reporting of Defects and Noncompliance" 
(Attachment 1).  It is expected that licensees will review this information, 
distribute this notice to responsible staff, and consider actions, if 
appropriate, to ensure compliance with applicable requirements.  However, 
this notice does not in itself establish any new requirements. 

Description of Circumstances: 

Past inspections at materials licensees indicate that many licensees are not 
complying with all the requirements of Part 21 and are unclear about the 
applicability of Part 21 to their licensed programs. 

In one case, a company supplying teletherapy units discovered a failure in a 
timer which could have resulted in a substantial safety hazard.  Although 
the failure was evaluated and the timer was determined to require 
replacement, an evaluation to determine if a substantial safety hazard could 
exist was not performed.  As a result, a responsible officer or director in 
the licensee's organization was not informed that the timer contained what 
NRC later determined to be a defect, and NRC was not notified of the defect, 
as required by 10 CFR 21.21(b).  A contributing factor in this case was the 
failure to establish appropriate procedures to evaluate whether a deviation 
could represent a substantial safety hazard, as required by 10 CFR 21.21(a).

In another case a radiographic equipment manufacturer reviewed circumstances 
surrounding separation of a source assembly from the drive cable.  Although 
the licensee took actions to recall the defective source, it failed to 
report the defect to NRC and had not developed procedures for evaluating 
manufacturing defects, to determine applicability to Part 21 reporting. 

Discussion: 

Part 21 was issued in June 1977, and applies to all licensees and certain 
unlicensed vendors.  The requirements in Part 21 are to ensure that 
equipment deficiencies or failures that could create a substantial safety 
hazard involving NRC-regulated activities are reported to NRC.  Prompt 
licensee reporting of 

9106110125
.

                                                            IN 91-39 
                                                            June 17, 1991 
                                                            Page 2 of 3 


defects will enable NRC to determine if a defect is generic in nature, so 
that appropriate measures can be taken to ensure protection of the public 
health and safety.  

The requirements are based on Section 206 of the Energy Reorganization Act, 
which states, in part, "Any individual director or responsible officer of a 
firm constructing, owning, operating, or supplying the components of any 
facility or activity which is licensed or otherwise regulated pursuant to 
the Atomic Energy Act of 1954, as amended, or pursuant to this Act, who 
obtains information reasonably indicating that such facility or activity or 
basic components supplied to such facility or activity (1) Fails to 
comply..., or (2) Contains a defect which could create a substantial safety 
hazard, ... shall immediately notify the Commission of such failure to 
comply, or of such defect...." 

The principal requirements of Part 21 include the following:  

(1)  Licensees must post required documents related to Part 21 in a 
     conspicuous location.  These include a copy of the regulation, Section 
     206 of the Energy Reorganization Act of 1974, and any procedures 
     developed pursuant to Part 21.  [10 CFR 21.6(a) and (b)] 
     
(2)  Licensees must develop procedures for identifying and evaluating 
     deviations, or informing affected customers, so that the customer can 
     evaluate the deviation; and must also develop procedures for reporting 
     defects to a director or responsible officer.  [10 CFR 21.21(a)] 
     
(3)  Licensees must report defects to NRC, within certain time frames. 
     [10 CFR 21.21(b)] 

(4)  Procurement documents issued by the licensee for basic components must 
     state that Part 21 applies to the procurement.  [10 CFR 21.31]

NRC staff recognizes that these requirements are very broad and require 
considerable licensee judgment to implement.  As a minimum, licensees should 
determine which aspects of their licensed activity could result in a 
substantial safety hazard from a defect in a basic component.  Attachment 2 
provides guidelines for determining what constitutes a substantial safety 
hazard.  NUREG-0302, Revision 1, published in October 1977, provides 
responses to questions on Part 21 raised in public regional meetings and 
contains several examples that will provide additional guidance on what 
constitutes a substantial safety hazard.  Copies of NUREG-0302 may be 
purchased from the National Technical Information Service, Springfield, VA 
22161. 

Furthermore, licensees are required to have procedures that implement the 
requirements to report defects.  Procedures should assign responsibilities 
to the appropriate individuals, to identify and report deviations to 
responsible company officers.  The responsibilities of company officers 
should be described; that is, to evaluate and report deviations to 
purchasers, and to inform NRC of defects within the required time frames.  
Licensees should evaluate their own programs and develop procedures 
appropriate for their activities.  Attachment 3 provides a sample procedure 
for identifying and reporting defects, under Part 21. 
.

                                                            IN 91-39 
                                                            June 17, 1991 
                                                            Page 3 of 3 


Manufacturers or suppliers who provide licensees with basic components that 
contain, or are used with, radioactive material, would normally need more 
extensive procedures to ensure proper identification and reporting of 
defects than customers who do not supply components to others.  These 
procedures should contain, as a minimum, the following: 

1.   Directions to acquire information sufficient to describe the deviation.
     
2.   Directions to analyze the effect of the deviation, in a basic 
     component, if used by a licensee. 
     
3.   Directions to reach a conclusion, based on the analysis as to whether 
     the deviation could create a substantial safety hazard. 
     
Licensees are subject to inspection for compliance with Part 21, as well as 
other applicable NRC requirements, and may be subject to enforcement action 
for noncompliance.  This information notice does not require any written 
response. If you have any questions about this matter, please contact the 
technical contact listed below or the appropriate NRC regional office. 




                                   Richard E. Cunningham, Director
                                   Division of Industrial and
                                     Medical Nuclear Safety


Technical Contact:  Cheryl A. Trottier, NMSS
                    301-492-3422

Attachments:
1.   10 CFR Part 21
2.   Guidelines for Determining Whether a Substantial
       Safety Hazard Exists
3.   Sample Procedure for Identifying and Reporting
       Defects Under 10 CFR Part 21
4.   List of Recently Issued NMSS Information Notices
5.   List of Recently Issued NRC Information Notices

.

                                                            Attachment 2 
                                                            IN 91-39
                                                            June 17, 1991
                                                            Page 1 of 1


                     GUIDELINES FOR DETERMINING WHETHER 
                            A SUBSTANTIAL SAFETY 
                                HAZARD EXISTS


1.   A substantial safety hazard means the loss of a safety function to the 
     extent that there is a major reduction in the degree of protection 
     provided to ensure public health and safety.  Note that the term 
     "public health and safety" includes both members of the public and 
     licensee workers/employees.

2.   From a radiological perspective, a substantial safety hazard exists if 
     there is a potential for moderate exposure to, or release of, licensed 
     material. 
     
     a.   Guidelines for determining moderate exposure: 
     
          o  Greater than 25 rem (whole body or its equivalent to other body 
             parts) to occupationally exposed workers in a period of a year 
             or less. 
          
          o  Exposure of 0.5 rem (whole body or its equivalent to other body 
             parts) to an individual in an unrestricted area in a period of 
             a year or less. 
          
     b.  Guideline for determining potential for release of licensed 
         material: 
     
          o  Release of materials in amounts reportable under the provisions 
             of 10 CFR 20.403(b)(2).

For additional discussion, see NUREG-0302, Revision 1 (page 21.3(k)-1), 
which may be purchased from the National Technical Information Service, 
Springfield, VA 22161. 
.

                                                            Attachment 3
                                                            IN 91-39
                                                            June 17, 1991
                                                            Page 1 of 1



                            SAMPLE PROCEDURE FOR
                      IDENTIFYING AND REPORTING DEFECTS
                            UNDER 10 CFR PART 21


Employees shall: 

1.   Identify deviations in a basic component (insert appropriate part or 
     component nomenclature). 

2.   Promptly report the deviations to the responsible company officer or 
     director (insert appropriate position). 

Company official (insert appropriate position) shall: 

1.   Cause deviation to be evaluated or reported to purchaser. 

2.   If determined to be a defect, promptly (within two days of receipt of 
     information) inform the Nuclear Regulatory Commission (NRC). 
     
     -  By telephone, facsimile, or in writing to the Director, Office of 
        Nuclear Material Safety and Safeguards, USNRC, Washington, DC 20555,
        or to the Regional Administrator.

3.   If initial notification was by telephone or facsimile, a written report 
     must be sent to NRC within 5 days of receipt of the information.  
     Submit three copies. 
     
     -  Identify the basic component with the defect or activity that failed
        to comply. 
     
     -  Include the nature of the defect or failure and the safety hazard 
        created or that could be created by the defect or failure. 
     
     -  Identify the date the information was obtained and the name of the 
        individual informing NRC. 
     
     -  List all locations where the basic component may be in use. 
     
     -  Describe corrective actions taken or being taken. 
     
     -  Advice related to the defect that has been, or will be given to 
        customers. 
     
.
Page Last Reviewed/Updated Tuesday, November 12, 2013