D72

13 August 1997

Australia-Republic of Korea Nuclear Safeguards: Front-End Retransfer Agreement

Australia and the Republic of Korea (ROK) exchanged diplomatic notes in Seoul on 11 August as the first step towards bringing into force an Agreement modifying the manner in which Australia will provide its consent for the retransfer, for specified purposes, of nuclear material to third countries.

Commonly called "a front-end retransfer settlement" because it relates to nuclear material before irradiation in a nuclear reactor, this Agreement will be similar to arrangements Australia has with a number of other bilateral partners. The ROK is a major customer for Australian uranium and accounts for an increasing share of our exports.

Nuclear material is often processed in separate countries at different stages of the international nuclear fuel cycle. Until now, requests by the ROK to retransfer to third countries nuclear material subject to the 1979 "Australia-ROK Agreement concerning the Cooperation in Peaceful Uses of Nuclear Energy and the Transfer of Nuclear Material" has required Australia's written consent on a case-by-case basis.

Under the new Agreement such consent is exercised in advance, on a generic basis for retransfers for specified purposes at the "front-end" of the nuclear fuel cycle. These purposes are conversion, enrichment to less than 20 per cent in the isotope U-235, fuel fabrication, and related research in these areas and under the terms of the Agreement may be effected by not)fication of the quantities transferred.

Case-by-case approvals will still be required for retransfers not specifically covered by the new Agreement. As with our nuclear safeguards agreements with other countries, retransfers are limited to countries within Australia's bilateral safeguards network and the material will continue to be accounted for by the Australian Safeguards Office.

The granting of such advance consent in no way detracts from Australia's non-proliferation and security objectives. It streamlines the operation of the 1979 Agreement by removing a layer of administrative process whilst preserving Australia's fundamental right to approve retransfers and to designate the countries to which the retransfers may be made.

In accordance with Australia's treaty-making procedures, the exchanged diplomatic notes constituting the Agreement will be tabled in Parliament for fifteen sitting days. The Agreement will enter into force on the date when Australia and the Republic of Korea have notified each other that all necessary domestic, legal and constitutional procedures required to give effect to the Agreement are completed.

Further Information: Julie McDonald 06 261 3665.