EIPR objects to nuclear energy laws and demands that nuclear plant contracts not be signed before laws are reviewed

Press Release

10 December 2017

Egyptian Initiative for Personal Rights (EIPR ) declared its objection to the recently issued nuclear energy laws and said that these laws contradict a number of legal and constitutional principles, undermine the independence of the Egyptian Nuclear and Radiological Regulatory Authority (ENRRA) and nuclear safety guarantees, as well as wasting state resources. EIPR demanded that these laws be reviewed and that nuclear power plant contracts not be signed for the time being.

EIPR also objected to the manner in which these laws were issued in a hurry and without a real opportunity for discussion and it expressed its concern about the continuation of the method of extreme secrecy and monopolizing decision making that accompanied the nuclear project from the beginning, and demanded following the principles of transparency and popular participation.

EIPR objection followed the Egyptian parliament emergency general session on November 27, 2017, during which it approved, in one go, three law proposals on nuclear energy submitted by the government:a bill "to establish the executive body to oversee the construction of nuclear power plants," and a law amending some provisions of law No. 13 of 1976 establishing the Authority for Nuclear Power Plants, and a law amending certain provisions of the Law on Regulation of Nuclear and Radiological Activities No. 7 of 2010.

The Chair of the Parliament had stated in the parliamentary session that there is a need to speed up the issuance of these laws, in what appears to be preparation for the signing of contracts during the expected visit of the Russian President, and indeed the draft laws were presented and approved in the same session, with which is difficult to imagine a real opportunity for discussion. The laws were promulgated and published in the Official Gazette on 29 November 2017.

According to Dr. Ragia al-Gerzawy, the environmental researcher in EIPR: ‘Transparency and independence of the regulatory bodies is one of the most important safeguards for nuclear safety. But unfortunately the [political] orientation behind the nuclear file (that led to the issuance of laws that eliminate the independence of the regulatory bodies, mobilize government representatives in the nuclear system, and open the door to profiteering), this orientation which is characterized by exclusion and withholding of information, do not appear to have been deeply concerned about nuclear safety policies’, adding that ‘nuclear energy is a matter that concerns the whole of society’.

The Egyptian initiative also stated that the most serious legal fault to these laws is the elimination of the independence of the Egyptian Nuclear and Radiological Regulatory Authority, which is responsible for the regulatory and oversight responsibility related to nuclear activities. And where ensuring the efficiency and independence of the regulatory body is a prerequisite for nuclear safetyhe nuclear regulatory authority is responsible for setting licensing conditions, issuing regulations, establishing safety standards and guidelines, granting or revoking permits for nuclear plants. It is also responsible for inspecting and monitoring facilities and activities and ensuring compliance with standards. It is further responsible for issuing regulations, safety standards, guidelines and other nuclear safety policies.

EIPR pointed out that the three laws collectively contributed in reducing this independence. The membership of the board of directors of the executive branch, the body entrusted with overseeing the establishment of the nuclear plant, included a representative of the Nuclear Regulatory Authority, in direct violation of Law No. 7 of 2010. As the law forbids members of the regulatory authority to have any connection with the facilities they monitor, and it also violates the safety requirements of the International Atomic Energy Agency (IAEA), which prohibit monitoring bodies from engaging in activities inconsistent with their oversight role.

Moreover, the three laws have filled the boards of directors of these three entities with the representatives of the concerned ministries and public bodies, including the Board of Directors of the Nuclear Regulatory Authority itself, which leads to the control of the regulatory body by executive authorities. Being the regulatory body entrusted with supervising the performance of these executive entities thus eliminating its regulatory role completely.

To further complicate the situation, the amendment of the law organizing Nuclear and Radiation activities, in a rare global precedent, allowed the Egyptian Nuclear and Radiological Regulatory Authority to set up companies to invest its funds, which is creates a truly difficult challenge to ensure that the interests of the economic benefits of the authority are not incompatible with the integrity and independence of its oversight role.

Concerning the waste of state resources, the Egyptian initiative stated that the law of “Establishing the Executive Body to Supervise Nuclear Stations” establishes an entity that is similar and overlaps in its prerogatives, powers and resources with an existing entity, the Nuclear Stations Authority, which also has the task of establishing nuclear plants. The State Council itself had commented on this overlapping in the terms of competencies when the bill was presented to it, and yet the law was passed.

In addition the law of the Nuclear Stations Authority provides a huge package of finantial exemptions and privileges to the Authority and its projects. The law exempts the nuclear stations from all taxes and duties, exempts what the Authority imports from custom taxes and other taxes and fees and exempts them from all taxes on the interest of foreign loans that it undertakes. And exempts what is imported by the companies and contracting bodies with the Nuclear Stations Authority and subcontractors from all taxes and fees and from the commitment to the minimum rate of distribution of profits, and exempts foreigners working in the projects of the Authority from all taxes on salaries and wages, bonuses and free professions and general tax revenue.

EIPR considers these exemptions and unjustified benefits as constituting a waste of state resources. As the project of the nuclear plant is a profitable project. It was one of the reasons for establishing the nuclear plant that it will achieve high profits to guarantee the payment of the loan, which amounts to 25 billion dollars and more. These exemptions undermines any justification for this abundance of grants, exemptions and exceptions, wasting all those opportunities of revenue for the state treasury. Especially that the law allows the “Nuclear Stations Authority” to establish companies to invest surplus funds in activities that may not necessarily be related to nuclear energy and that these financial benefits extend legally to all the Authority's projects. Including those that have nothing to do with nuclear energy. It’s worth mentioning that the Ministry of Finance objected to these exemptions in particular, and that the Authority and the executive body receive allocations from the state treasury. EIPR also showed that this situation represents privileging nuclear power over other sources of electricity that do not enjoy these privileges.