Press Release

Department of Commerce Official Testifies Before Senate Energy and Natural Resources Committee

Assistant Secretary for Import Administration Discusses Imported Uranium from Russia

WASHINGTON—Today Assistant Secretary for Import Administration David Spooner testified before the Senate Committee on Energy and Natural Resources. Spooner delivered an update concerning the importation of Russia uranium.

On February 1, 2008, U.S. Commerce Secretary Carlos M. Gutierrez and the Director of Russia’s then Federal Atomic Energy Agency (Rosatom), which is now a State Corporation, Sergey Kiriyenko, signed a long-term amendment to the Agreement Suspending the Antidumping Investigation on Uranium from Russia. The Agreement allows Russia to make direct sales of commercial Russian low-enriched uranium (LEU) products to U.S. utilities under a quota for Russian exports from 2014-2020. Prior to the Agreement, Russia was unable to sell enriched uranium products to U.S. utilities. The Russian Federation will also be able to export smaller quantities of uranium products during the years 2011 through 2013. The Agreement also minimizes any disruption in the development and completion of new enrichment facilities in the United States.

However, at this time the amendment’s quota limits are not fully enforceable due to adverse court decisions in the Eurodif cases concerning French LEU. Pursuant to that litigation, LEU produced pursuant to uranium enrichment, or separative work unit (SWU) contracts, cannot be covered by the antidumping duty (AD) law. Therefore, such imports threaten the market stability and energy security benefits that a finalized amendment to the Suspension Agreement is designed to facilitate.

“The flawed Eurodif decision provided a dangerous road map for circumventing U.S. trade remedy laws and jeopardizes our national and economic security,” said Assistant Secretary Spooner. “The Administration strongly believes that resolving this threat will ensure that the newly-amended agreement can continue to facilitate stability in the U.S. market, developing U.S. uranium enrichment capability is not undermined, and U.S. national security and energy security interests are preserved.”

Commerce, in concert with the National Security Council, State, Energy and other agencies, is actively pursuing various options to address the “loophole” created by the Eurodif court decisions including legislation as well as a request for Supreme Court review. Until this loophole is closed, the limits imposed by the amendment to the Suspension Agreement will be essentially ineffective as long as the Russians structure their transactions in order to exclude them pursuant to the Eurodif decisions.

In late December 2007, Senate Minority Leader Mitch McConnell (R-Ky), Senator Jim Bunning (R-Ky) and Representative Ed Whitfield (R-Ky) introduced legislation to address the Eurodif court ruling. The legislation would clarify that LEU imported pursuant to contracts for both LEU and SWU would be subject to antidumping and countervailing duty laws. The Administration strongly supports this proposed legislation and has forwarded to the bill’s sponsors a letter of support signed by the Departments of Commerce, State, Energy and Defense.

Background
A suspension agreement is essentially a settlement of an ongoing dumping 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 low-enriched uranium 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 has been under negotiation for two years, permits Russia to supply approximately 20 percent of U.S. reactor fuel from 2014 through 2020 and to supply the fuel for new reactors quota-free. After considering the comments received, Commerce signed the finalized Agreement with Rosatom.

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