For Immediate Release: April 22, 2008
Contact: Brittany Eck (202) 482-3809
U.S. SUPREME COURT TO HEAR COMMERCE APPEAL OF KEY ANTIDUMPING CASE ON URANIUM
WASHINGTON - Today, Assistant Secretary for Import Administration David Spooner announced that the Administration is pleased that the United States Supreme Court decided to hear the Administration’s appeal of the Eurodif decisions, which created a substantial loophole in the antidumping law by finding that enriched uranium was a “service” not subject to the trade remedy law. Until the Eurodif loophole is closed, the limits imposed on imports of Russian uranium by the Commerce Department’s recent agreement with the Russian Federation will be less effective, provided that the Russians structure their transactions as sales of enrichment “services” exempt from the antidumping law.
“The Administration is encouraged that the Supreme Court has decided to hear arguments appealing the flawed Eurodif decisions, which provided a dangerous roadmap for circumventing U.S. trade remedy laws and jeopardize our national and energy security,” said Assistant Secretary Spooner. “We hope that the Court will resolve this threat and ensure that the Administration’s agreement with Russia to control uranium trade can continue to facilitate stability in the U.S. market.”
On Feb. 1, 2008, U.S. Commerce Secretary Carlos M. Gutierrez and Sergey Kiriyenko, the Director of Russia’s then Federal Atomic Energy Agency (Rosatom), which is now a State Corporation, signed a long-term amendment to the Agreement Suspending the Antidumping Investigation on Uranium from the Russian Federation. The Agreement allows Russia to make direct sales of commercial Russian uranium products, including low-enriched uranium (LEU), to U.S. utilities from 2011-2020, subject to quotas.
Prior to the Agreement, Russia was unable to sell enriched uranium products directly to U.S. utilities because of prior trade-remedy agreements. By limiting commercial sales of Russian uranium in the United States, the antidumping agreement bolsters national security by providing critical support to the “megatons to megawatts” agreement administered by the Department of Energy, through which uranium from 20,000 Russian nuclear bombs is being transformed into LEU for use by U.S. utilities in generating electricity. The antidumping agreement sustains energy security by minimizing any disruption in the development and completion of new uranium enrichment facilities in the United States.
At this time, the antidumping agreement’s quotas are not fully enforceable due to the Eurodif decisions. In 2007, the Court of Appeals for the Federal Circuit ruled that enriched uranium was a “service” and not a good subject to the dumping law. Those decisions hold that imports of LEU produced pursuant to separative work unit (SWU) contracts, which describe the enrichment processing as a “service” are not subject to the antidumping law. Such imports could threaten the market stability of the U.S. uranium market and the energy security benefits that the recent amendment to the Suspension Agreement is designed to facilitate.
Background
A suspension agreement is essentially a settlement of an ongoing antidumping investigation and suspends applicable dumping tariffs. Prior to the signing of the new amendment, the only Russian uranium product allowed into the United States for consumption in nuclear reactors was LEU down-blended from bomb-grade material, which is sold indirectly to U.S. utilities via an agent of the U.S. government. To ensure an available supply of energy and to facilitate investment in nuclear energy, the United States and Russia have now agreed to allow for direct sales of commercial Russian uranium products to U.S. utilities. Commerce and Rosatom officials initialed the draft Agreement in November 2007 and released that draft for public comment. The Agreement, which had been under negotiation for two years, permits Russia to supply approximately 20 percent of U.S. reactor fuel from 2014 through 2020, with smaller quantities permitted in the years 2011-2013, and to supply the fuel for new reactors quota-free. In 2007, Russia exported more than $550 million of LEU downblended from nuclear weapons to the United States.
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