JAPAN CONSIDERING CSC RATIFICATION

C O N F I D E N T I A L TOKYO 001702

SIPDIS

E.O. 12958: DECL: 06/16/2018
TAGS: KNNP TRGY ENRG KSTC IAEA PARM JA
SUBJECT: JAPAN CONSIDERING CSC RATIFICATION

Classified By: EMIN Robert F. Cekuta, reasons 1.4 b/d


1. (U) Please note action requests in paras 4 and 6.


2. (SBU) Embassy officers delivered points (ref) urging
Japan's membership in the Convention of Supplementary
Compensation (CSC) to Ministry of Education, Culture, Sports,
Science and Technology (MEXT) Atomic Energy Division Deputy
Director Akira Tsugita. Tsugita said the GOJ is seriously
considering joining the CSC, but first needs to conduct a
thorough interagency review. As a result, Tsugita continued,
Japan cannot ratify the CSC by the IAEA's General Conference
this September.


3. (C) Tsugita went on to point out political and technical
challenges Japan must address in order to move ahead with CSC
ratification. Noting a need for a strong push within the GOJ
to move on the Convention, Tsugita suggested Japanese
suppliers could become active because the nuclear liability
convention directly affects industrial interests. However,
the GOJ has yet to hear from Japan's nuclear manufacturing
industry regarding the CSC. He asserted that Japan's nuclear
industry is not aware of nuclear liability conventions and
suggested GE and Westinghouse industry executives engage
their Toshiba and Hitachi counterparts on the issue.


4. (C) Although MEXT is the lead ministry responsible for
reviewing the CSC -- nuclear liability falls under MEXT's
jurisdiction -- it still needs to secure support from other
agencies, principally METI, which is responsible for
promoting nuclear development and trade. METI could be
instrumental in getting industry to make necessary
commitments to the CSC, Tsugita noted. Tsugita said he would
appreciate any USG suggestions on forging a strategic
partnership between GOJ agencies and the nuclear
manufacturing industry to advance the liability convention.


5. (SBU) On the technical side, Tsugita pointed out
challenges with the definition of "damage" as stated in the
CSC non-paper. Under Japan's current domestic nuclear damage
law, "cost preventive measures" are excluded entirely and
"environmental damage coverage" also may be excluded
depending on interpretation. Tsugita said in an effort to
determine how best to handle such gaps, MEXT officials are
analyzing whether to modify Japan's current domestic law or
draft an entirely new one. The process could take
considerable time, he noted.


6. (SBU) MEXT provided the following additional specific
questions and comments June 16:

a) We would like to obtain a brief summary on U.S. nuclear
power compensation coverage for damages, including the
Price-Anderson Act, if available.

b) Did the U.S. revise its domestic law in order to ratify
the CSC? If so, could the USG provide documents concerning
the kinds of revisions made?

c) We understand the U.S. expects China to join CSC. What
are U.S. views on how China will ratify the liability
convention? (Currently, China does not have a domestic
nuclear liability act except for administrative documents
published as a response from the Chinese State Council.)

d) We understand the U.S. will establish a funding system
for the CSC in the next three years. However, some kind of
system must have been implemented because the U.S. has
already ratified the CSC. If so, we would like to know
primary funding sources and how much of the burden is shared?

e) How has the U.S. determined which nuclear-related
facilities should be covered under the CSC? The CSC has a
special clause to include a small compensation package for
small-scale nuclear facilities. Has the U.S. implemented a
small compensation system? If so, how has the U.S. defined
small-scale nuclear facilities? How will the U.S. secure
appropriate funding, which is up to 300 million SDR of public
capital?

f) We recognize that the definitions of "impairment of
environment" and "measures of reinstatement" in the CSC
include broad damages, such as the cost of measures taken to
reinstate the environment damaged by a nuclear accident. Is
the definition of nuclear damage included in any U.S.
domestic law?

g) The CSC stipulates that the measures of reinstatement
shall be "approved" by the competent authorities of the State
and the law of the State where the damage occurred determines
who is entitled to take such actions. Is the action covered
in any U.S. current domestic law?

7. (C) Comment: While Japan's eventual ratification of the
CSC appears likely, it may require considerable time. MEXT
needs sustained cooperation from MOFA and METI. MEXT also
wants to work very closely with U.S. technical and legal
experts to ensure clear and correct interpretation of certain
CSC provisions. Fact-finding sessions between industry and
GOJ officials to explore the details of CSC implementation
could be beneficial. One positive sign is that MEXT
announced a Special Committee on Implementation of Nuclear
Liability, comprised of Japanese government officials,
academics, industry executives, and lawyers, to meet from
June through September 2008 and that the benefits of CSC will
be on its agenda. End Comment.
SCHIEFFER