Preventing Nuclear Proliferation in Saudi Arabia Act of 2019

II 116TH CONGRESS 1ST SESSION S. 2338 To prohibit the Export-Import Bank of the United States from financing the export of nuclear technology, equipment, fuel, materials, or other goods or services to Saudi Arabia, and for other purposes. IN THE SENATE OF THE UNITED STATES JULY 30, 2019 Mr. VAN HOLLEN (for himself, Mr. GRAHAM, Mr. MORAN, and Mr. MERKLEY) introduced the following bill; which was read twice and re- ferred to the Committee on Banking, Housing, and Urban Affairs A BILL To prohibit the Export-Import Bank of the United States from financing the export of nuclear technology, equip- ment, fuel, materials, or other goods or services to Saudi Arabia, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Preventing Nuclear 4 Proliferation in Saudi Arabia Act of 2019’’. 5 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 2 •S 2338 IS SEC. 2. PROHIBITION ON EXPORT-IMPORT BANK FINANC- 1 ING FOR EXPORT OF NUCLEAR TECHNOLOGY, 2 EQUIPMENT, FUEL, MATERIALS, OR OTHER 3 GOODS OR SERVICES TO SAUDI ARABIA. 4 (a) FINDINGS.—Congress makes the following find- 5 ings: 6 (1) The Export-Import Bank of the United 7 States identifies global nuclear power as a key and 8 growing industry in which the Bank has played an 9 important role by financing the export of United 10 States nuclear equipment, fuel, technology, and serv- 11 ices to foreign purchasers. 12 (2) In September 2012, the Export-Import 13 Bank authorized a $2,000,000,000 direct loan to the 14 Barakah One Company of the United Arab Emirates 15 to finance the export of United States equipment 16 and service-expertise for the construction of a nu- 17 clear power plant in the United Arab Emirates, the 18 first of its kind on the Arabian Peninsula. 19 (3) The transaction to finance the construction 20 of the Barakah nuclear power plant was enabled by 21 the establishment of a bilateral nuclear cooperation 22 agreement between the United States and the 23 United Arab Emirates made pursuant to section 123 24 of the Atomic Energy Act of 1954 (42 U.S.C. 25 2153), in which the United Arab Emirates com- 26 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 3 •S 2338 IS mitted to forgo uranium enrichment and reprocess- 1 ing on its territory and was obligated to bring into 2 force an Additional Protocol to its Comprehensive 3 Safeguards Agreement with the International Atom- 4 ic Energy Agency. 5 (4) The nuclear cooperation agreement, which 6 was signed on May 21, 2009, became known as the 7 first ‘‘gold standard’’ civil nuclear agreement and 8 was viewed as a step toward building a strong non- 9 proliferation framework in the region. 10 (5) In accordance with that agreement, the 11 United Arab Emirates reserves the right to amend 12 its terms in the event the United States establishes 13 a peaceful nuclear cooperation agreement with an- 14 other non-nuclear-weapon state in the Middle East 15 that is less prescriptive in scope and effect than its 16 agreement with the United States. 17 (6) The Government of Saudi Arabia intends to 18 develop an extensive civilian nuclear program, in- 19 cluding the construction of 2 nuclear power reactors 20 and multiple small modular reactors. 21 (7) For the construction of its first 2 nuclear 22 power reactors, the Government of Saudi Arabia 23 plans to issue a multi-billion dollar tender in 2020, 24 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 4 •S 2338 IS and among the potential suppliers is the United 1 States. 2 (8) The Government of Saudi Arabia currently 3 has in place a Small Quantities Protocol to its Com- 4 prehensive Safeguards Agreement with the Inter- 5 national Atomic Energy Agency, an agreement that 6 suspends the application of a number of safeguards 7 requirements for a country with minimal nuclear 8 material activities on its territory or under its juris- 9 diction. 10 (9) Despite its plans to develop an extensive ci- 11 vilian nuclear program and interest in the United 12 States as a supplier of nuclear technology and exper- 13 tise, the Government of Saudi Arabia has dem- 14 onstrated little willingness to accept strong non- 15 proliferation measures, such as an Additional Pro- 16 tocol to its Comprehensive Safeguards Agreement 17 with the International Atomic Energy Agency, and 18 has even expressed a desire for acquiring uranium 19 enrichment technology. 20 (10) Fully functional with a quorum and if re- 21 authorized beyond September 30, 2019, when its 22 current charter lapses, the Export-Import Bank will 23 regain its ability to finance United States nuclear 24 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 5 •S 2338 IS exports by extending loans and credit to foreign pur- 1 chasers. 2 (b) SENSE OF CONGRESS.—It is the sense of Con- 3 gress that— 4 (1) any provision of financing assistance by the 5 Export-Import Bank of the United States to Saudi 6 Arabia for the import of United States nuclear tech- 7 nology, equipment, fuel, materials, or goods or serv- 8 ices should be conditioned on the commitment of the 9 Government of Saudi Arabia to renounce uranium 10 enrichment and reprocessing on its territory and its 11 adoption and implementation of an Additional Pro- 12 tocol to its Comprehensive Safeguards Agreement 13 with the International Atomic Energy Agency as a 14 way to advance United States nonproliferation and 15 nuclear cooperation objectives in the region; and 16 (2) to further bolster nonproliferation efforts in 17 the region, the United States should oppose, through 18 the Nuclear Suppliers Group, the export of nuclear 19 technology to Saudi Arabia until the Government of 20 Saudi Arabia has— 21 (A) committed to renouncing uranium en- 22 richment and reprocessing on its territory; and 23 (B) signed and implemented an Additional 24 Protocol to its Comprehensive Safeguards 25 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 6 •S 2338 IS Agreement with the International Atomic En- 1 ergy Agency. 2 (c) PROHIBITION.—The Export-Import Bank of the 3 United States may not guarantee, insure, or extend (or 4 participate in the extension of) credit in connection with 5 the export of nuclear technology, equipment, fuel, mate- 6 rials, or other goods or services to Saudi Arabia unless— 7 (1) the Government of Saudi Arabia— 8 (A) has in effect a nuclear cooperation 9 agreement pursuant to section 123 of the 10 Atomic Energy Act of 1954 (42 U.S.C. 2153); 11 (B) has signed and implemented an Addi- 12 tional Protocol to its Comprehensive Safeguards 13 Agreement with the International Atomic En- 14 ergy Agency; and 15 (C) has committed not to possess sensitive 16 nuclear facilities within its territory or other- 17 wise to engage in activities relating to the en- 18 richment or reprocessing of nuclear material; 19 and 20 (2) not less than 30 days before the Board of 21 Directors of the Bank provides final approval to the 22 guarantee, insurance, or extension (or participation 23 in the extension) of credit, the Bank, in coordination 24 with the Secretary of State and the Chairman of the 25 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 7 •S 2338 IS Nuclear Regulatory Commission, submits to the ap- 1 propriate congressional committees a report that in- 2 cludes— 3 (A) a detailed description of, and an expla- 4 nation for providing the guarantee, insurance, 5 or extension (or participation in the extension) 6 of credit for, the transaction; 7 (B) a description of the nuclear tech- 8 nology, equipment, fuel, materials, or other 9 goods or services that will be exported to Saudi 10 Arabia; 11 (C) the name, address, and place of incor- 12 poration or other legal organization of the im- 13 mediate parent, the ultimate parent, and each 14 immediate parent, if any, of the foreign entities 15 that are parties to the transaction; 16 (D) the name of all United States busi- 17 nesses that are parties to the transaction; and 18 (E) the name of any and all other financial 19 institutions involved in the transaction, includ- 20 ing as advisors, underwriters, or a source of fi- 21 nancing for the transaction. 22 (d) TREATMENT OF CONFIDENTIAL INFORMATION.— 23 If the Export-Import Bank of the United States deter- 24 mines that any information required to be included in the 25 VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS 8 •S 2338 IS report under subsection (c)(2) should be made confiden- 1 tial, that information may be submitted in a separate and 2 confidential report to the chairmen and ranking members 3 of the appropriate congressional committees. 4 (e) DEFINITIONS.—In this section: 5 (1) APPROPRIATE CONGRESSIONAL COMMIT- 6 TEES.—The term ‘‘appropriate congressional com- 7 mittees’’ means— 8 (A) the Committee on Banking, Housing, 9 and Urban Affairs and the Committee on For- 10 eign Relations of Senate; and 11 (B) the Committee on Financial Services 12 and the Committee on Foreign Affairs of the 13 House of Representatives. 14 (2) SENSITIVE NUCLEAR FACILITY.—The term 15 ‘‘sensitive nuclear facility’’ means any facility de- 16 signed or used primarily for uranium enrichment, re- 17 processing of nuclear fuel, heavy water production, 18 or fabrication of nuclear fuel containing plutonium. 19 Æ VerDate Sep 11 2014 23:31 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6301 E:\BILLS\S2338.IS S2338 kjohnson on DSK79L0C42 with BILLS