What is the Nuclear Liability Bill 2010?

  • India and the United States signed a civil nuclear agreement in October 2008, which allows for civil nuclear partnership between the two countries on the condition that India would separate its civil and military facilities and put the civilian facilities under IAEA inspection. One necessary condition for the implementation of this agreement was to put into place a compensation regime that would in the event of a nuclear accident. The Nuclear Liability Bill or the Civil Liability for Nuclear Damage Bill 20 1 0 serves to put that compensation regime into place. The Bill defines the financial and legal liabilities upon the involved groups, manufacturers, operators ­(Operator", in relation to a nuclear installation, means the Central Government or any authority or corporation established by it or a Government company who has been granted a licence pursuant to the Atomic Energy Act, 1962 for the operation of that installation;) and government in case a nuclear accident occurs. It stipulates the compensation that the operator, the federal government and the private suppliers and contractors would have to provide to the affected population in case of a nuclear accident.

  • The Bill defines nuclear incidents and nuclear damage, nuclear fuel, material and nuclear installations, and also operators of nuclear installations.. It lays down who will be liable for nuclear damage, and the financial limit of the liability for a nuclear incident. It creates authorities who will assess claims and distribute compensation in cases of nuclear damage. It also specifies who can claim compensation for nuclear damage, and how compensation can be claimed and distributed. It specifies penalties for not complying with the provisions of the Bill, or any directions issued under it.

Why is it important?

  • In some countries like Russia and France, liabilities of private companies are underwritten by their governments. But in countries where the government does not underwrite the liabilities of private companies, a Bill like this would be useful as it can help the private companies get some insurance cover. Companies would be reluctant to enter the Indian markets unless compensation structures were not defined.

What are the main features of the Bill?

  • The bill defines nuclear damage as (a) loss of life or injury to a person, (b) loss or damage to property caused by a nuclear incident ( c) economic loss arising out of such damage to person or property, (d) costs of measures to repair the damage caused to the environment, (e) loss of income derived from an economic interest in any use or enjoyment of the environment, and (f) costs of preventive measures.

  • The Atomic Energy Regulatory Board has to notify a nuclear incident within 15 days from the date of a nuclear incident occurring.

  • The operator of a nuclear installation will be liable for nuclear damage caused by a nuclear incident in that installation or if he is in charge of nuclear material that caused the incident. If more than one operator is liable for nuclear damage, all operators shall be jointly, and severally liable to pay compensation for the damage. The Bill also provides certain exceptions to an operator's liability. The operator has a right of recourse against the supplier and other individuals responsible for the damage under certain conditions.

  • The operator of the nuclear installation, after paying the compensation for nuclear damage in accordance with the provisions, shall have a right of recourse where-(a) such right is expressly provided for in a contract in writing; (b) the nuclear incident has resulted as a consequence of an act of supplier or his employee, which includes supply of equipment or material with patent or latent defects of sub-standard services; ( c) the nuclear incident has resulted from the act of commission or omission of an individual done with the intent to cause nuclear damage.

What compensation does the Bill stipulate?

  • The Bill states that the total liability for a nuclear incident shall not exceed the rupee equivalent of 300 million Special Drawing Rights (Approximately Rs 2100 crore at current exchange rates). Within this amount, the liability of the operator shall be (a) in respect of nuclear reactors having thermal power equal to or above ten MW, rupees one thousand five hundred crores; (b) in respect of spent fuel reprocessing plants, rupees three hundred crores; (c) in respect of the research reactors having thermal power below ten MW, fuel cycle facilities other than spent fuel reprocessing plants and transportation of nuclear materials rupees one hundred 'Cores. The Central Government may review the amount of operator's liability from time to time and specify, by notification, a higher amount under this sub-section: If damage is caused in a nuclear installation owned by the central government, the government will be solely liable.

How will the system operate?

  • The Bill allows the central government to create two authorities by notification:

a. Claims Commissioner: The Claims Commissioner will have certain powers of a civil court. Once a nuclear incident is notified, the Commissioner will invite applications for claiming compensation.

b. Nuclear Damage Claims Commission: Where the Central Government, having regard to the injury or damage caused by a nuclear incident, is of the opinion that it is expedient in public interest that such claims for be adjudicated by the Commission instead of a Claims Commissioner, it may establish a Commission for the purpose of this Act. The Commission shall consist of a Chairperson and a maximum of six members appointed by the government.

  • An application for claiming compensation can be made by (a) person sustaining the injury, (b) owner of the damaged property, (c) legal representative of a deceased person, or (d) an authorized agent. An application can be made within three years from the date of the person having knowledge of nuclear damage. The right to claim compensation for nuclear damage will end if such claim is not made within a period of-(a) ten years, in the case of damage to property; (b) twenty years, in the case of personal injury to any person, from the date of occurrence of the incident

What was the debate regarding the Bill ?

  • The debate was mainly with regard to the amount of financial assistance and legal relief, and to clause 17 b in the original draft which provided for proving the "intent" of a supplier of causing an accident if compensation were to be claimed. Since it is very difficult to prove intent, it would effectively mean that the manufacturer and supplier would have no legal liability and very little financial liability in case of an accident, which meant that they would be let off very easily.

  • The Bill was passed by the Lok Sabha after 18 amendments which included rephrasing of clause 17b to remove the word 'intent'. The financial compensation was also raised.

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