Applications for specific authorization, which must be  approved by the Secretary of Energy, undergo a three-stage review  process, as depicted in figure 1. DOE Consistently Missed Target Time Frames for Processing Part 810 Applications, with the Interagency and Final Review Stages Taking Longest

From 2008 through 2013, DOE consistently missed its 30-day targets to  complete the initial and interagency stages of the Part 810 review  process. The third stage, for which DOE has not established  a target time frame, had the longest median review times. According to DOE officials, MOX is a  sensitive technology, which requires greater scrutiny. Interagency Review Times Missed DOE’s Target for More Than 95 Percent of Applications

Interagency review times missed DOE’s 30-day target for 85 of the 89  applications approved from 2008 through 2013. DOE’s targets are not comprehensive, as DOE has not established  targets for the entire third stage of the Part 810 process, or for overall  processing time. DOE and Representatives of U.S. Nuclear Exporters Stated That the Lengthy Part 810 Process Can Impose Business Risks

DOE, in its preamble to the proposed changes to Part 810, acknowledged  nuclear exporters’ concerns that the time frame for processing specific  authorizations can impose business risks for companies. DOE has not provided written guidance to help exporters interpret  the scope of the regulation; instead, DOE encourages exporters to inquire  with DOE officials for interpretation. DOE officials said that  they do not document all inquiries or responses because some inquiries  are vague, and DOE’s responses are predecisional. DOE Has Taken Steps to Clarify the Regulation

DOE has taken steps to clarify Part 810, recognizing in its Supplemental  Notice of Proposed Rulemaking that the scope of activities regulated  under Part 810 could be clearer. DOE’s primary method for monitoring compliance with the  conditions is for NNSA officials to read required reports from exporters  and in some cases to conduct a more in-depth analysis of the reports. However, NNSA officials report that they typically conduct an in-depth  analysis for compliance with the authorizations on less than 10 percent of  the reports, and they do not have risk-based procedures for prioritizing  which reports to analyze. In addition, according to a State official, U.S.  embassies play a role in monitoring the extent to which the importing  country and company or other entity, as well as the exporter, are  complying with the conditions associated with Part 810 authorizations. DOE Has Not Determined Its Authority to Impose Civil Penalties and Does Not Provide Guidance for Companies to Self-Identify and Self-Report Possible Violations

DOE has not determined whether it has legal authority to impose civil  penalties for violations of Part 810 and does not provide guidance for  companies to self-identify and self-report possible violations. DOE and DOJ Have Not Taken Any Formal Actions to Enforce Part 810

Neither DOE nor DOJ have taken formal actions—such as revoking an  authorization or prosecuting an exporter—to enforce Part 810 within the  last 6 years, even though there have been violations of Part 810 within  this period. Without a  documented inquiry process, DOE does not have the information it needs  to provide reasonable assurance that its responses are consistent, and  DOE officials are not documenting information that could identify parts of  the regulation that may need clarification. Consequently, DOE is missing an opportunity to encourage  exporters to recognize and address violations. Based on the results of this review, establish  realistic and achievable targets for each stage of the Part 810  process, including the third stage, as well as the overall process. Appendix I: Scope and Methodology

In this report, we examine (1) Part 810 processing times, compared with  the Department of Energy’s (DOE) targets, for over the last 6 years; (2)  the extent to which Part 810 is clear and DOE can reasonably assure  consistent interpretation; and (3) the extent to which DOE enforces Part  810. We analyzed DOE  data on the processing times for the 89 specific authorizations granted  from 2008 through 2013. To examine the extent to which DOE can reasonably assure  that the regulation is consistently interpreted, we consulted DOE’s 10  C.F.R.
Why GAO Did This Study

Encouraging U.S. exports of civilian nuclear products, services, and technology while ensuring they are not used for foreign nuclear weapons programs is a fundamental goal of U.S. policy. Exports of U.S. civilian nuclear technology, assistance, and services are regulated by DOE through 10 C.F.R. Part 810. Depending on the importing country and technology, exports can be generally authorized, with no application required, or specifically authorized, in which case the exporter must submit an application to DOE. The Departments of Commerce, Defense, and State, as well as the Nuclear Regulatory Commission, also review the applications, which must finally be approved by the Secretary of Energy.
GAO was asked to examine the Part 810 process. This report examines (1) Part 810 processing times over the last 6 years compared with DOE's targets; (2) the extent to which Part 810's scope is clear and DOE can reasonably assure consistent interpretation; and (3) the extent to which DOE enforces Part 810. GAO analyzed all 89 specific authorizations granted from 2008-2013 and interviewed key agency officials and U.S. nuclear industry representatives.

What GAO Found

The Department of Energy (DOE) has consistently missed its 30-day targets for the initial and interagency stages of the Part 810 review process (see table). From 2008 through 2013, DOE missed the target for the initial review stage for 80 of 89 applications processed, and interagency review times missed DOE's 30-day target for 85 applications. DOE has not established a target for the entire final review stage, which had the longest median review times, or for the overall process. DOE has acknowledged exporter concerns that processing times for specific authorizations can impose business risks, and DOE officials have proposed initiatives to reduce processing times.
a
The scope of Part 810 is unclear, and DOE's inquiry process does not reasonably assure that the regulation is consistently interpreted. For example, it is unclear what marketing activities are covered by Part 810. DOE has not provided written guidance to clarify the regulation's scope, instead directing exporters to inquire with DOE officials. DOE officials said that they do not document all such inquiries or their responses. Without such documentation, DOE can neither reasonably assure that its responses are consistent, nor can it analyze the inquiries to identify parts of the regulation that may need clarification. DOE is taking some steps to clarify Part 810 by defining or refining some key terms. However, DOE's revisions do not address all terms that exporters have identified as unclear, and the time frame of DOE's revisions is unknown.
DOE has taken limited actions to enforce Part 810. DOE's primary method for monitoring compliance with Part 810 is reading reports from exporters, but according to DOE officials, they conduct in-depth analysis on less than 10 percent of reports and do not have a risk-based procedure for selecting reports to analyze. Also, because DOE does not provide guidance for companies to self-identify and self-report possible violations, DOE is missing an opportunity to leverage exporters' role in monitoring their own compliance. DOE has not yet determined whether it has the legal authority to impose civil penalties for violations of Part 810. According to DOE officials, DOE has never taken a formal action for a violation of Part 810, such as revoking an authorization or referring a potential violation to the Department of Justice (DOJ). Furthermore, DOJ officials reported that they are not aware of any prosecutions related to Part 810 violations from 2008-2013, the time frame GAO reviewed.

What GAO Recommends

GAO recommends that the Secretary of Energy take several actions to improve the Part 810 process, such as determine whether DOE has legal authority to impose civil penalties, and establish realistic and achievable targets for each stage of the Part 810 process, as well as the overall process. DOE agreed with the recommendations.