Pages 17-20 from FCO 177-1373

The document discusses various issues related to nuclear supply controls within the Nuclear Suppliers Group (NSG). The sender appreciates the Netherlands' role in chairing the NSG working group and provides comments on the draft report.

They agree that the scope of the working group should include conditions of supply, amending existing conditions, and consideration of sanctions. They suggest including procedures for implementing existing conditions in the report. They also discuss the policy of extended full-scope safeguards (FSS) and note the challenges in obtaining agreement on the approach of using the nuclear embargo as a means to ensure FSS policy is not undermined through Chinese reexports.

Regarding enforceable retransfer assurances, they support option (D) but acknowledge the challenge of enforcement. They propose a policy where violations of retransfer assurances could lead to the suspension of exports until remedial measures are taken. They also suggest the possibility of NSG members agreeing to an approach similar to option (C) in cases where end-use or enforceable retransfer assurances are difficult to ascertain.

The document also addresses FSS policy exceptions and suggests criteria for determining transfers that may qualify as exceptions. They emphasize the importance of informing and consulting with NSG members before authorizing any exception to the FSS standard.

Regarding country restraints, they propose an exchange of information on national controls, denial decisions, and exports to countries of proliferation concern. They suggest the inclusion of a catch-all measure and the establishment of an agreed list of end-uses that would trigger licensing requirements.

Additionally, the document suggests addressing controls on intangible technology, such as training courses and fellowships. They propose discussing possible leaks and exchanging information on national controls in this area.

The sender agrees with addressing technology leaks and information exchange on actions by recipient firms or governments that may not strictly violate NSG guidelines but have nuclear proliferation significance. They suggest facilitating NSG consultations and listing possible sanctions beyond termination of nuclear exports if necessary.

Finally, they note the expansion of the NSG regime to include nuclear-related items and related technology and propose that explicit nuclear export sanctions could include termination of exports controlled under Part 2.