High Court to Hear Uranium Case

Bethesda's USEC Argues to Impose Anti-Dumping Duties on French Firm

Solicitor General Paul D. Clement cited national security interests. (Department Of Justice - Department Of Justice) The Supreme Court said yesterday that it would hear a dispute between USEC of Bethesda and a French supplier of low-enriched uranium in a case the federal government said has implications not only for the energy industry but also for efforts to dismantle some nuclear weapons. Justices agreed to consider in their term that begins next fall whether anti-dumping duties can be imposed on Eurodif, which supplies utilities in the United States with low-enriched uranium, a critical component in the domestic production of nuclear power. USEC, the only U.S. company that enriches uranium, complained to the Commerce Department that Eurodif's prices were unfairly low, and the agency decided in 2001 that anti-dumping duties should be levied. But the U.S. Court of International Trade disagreed, and in September the U.S. Court of Appeals for the Federal Circuit upheld that ruling. USEC received powerful support from the federal government, which urged the Supreme Court to take the case. The appeals court decision, Solicitor General Paul D. Clement said in a brief to the high court, "threatens to undermine U.S. foreign policy and national security interests in the remarkably sensitive context of nuclear fuel, nonproliferation, and ensuring domestic supplies for nuclear weaponry." He said it would endanger the financial viability of USEC, the sole source of certain types of nuclear fuel used for military purposes. A coalition of utilities joined Eurodif and its parent company, Areva, in urging the court not to review the case, which they said had been correctly decided by the lower courts. If Congress is concerned about the viability of USEC, they argued, there are other ways to take care of it. "The antidumping statute is an instrument of trade policy with general application to all industries, and not a tool for the implementation of national security or energy policies," argued the Ad Hoc Utilities Group. While the Commerce Department sided with USEC, the courts agreed with the utilities that, in least some cases, importing the low-enriched uranium constituted a provision of a service by the French company, not a purchase of a product. Products are covered by the anti-dumping laws, while services are not. The federal government asked the Supreme Court to uphold the Commerce Department's authority and expertise. And it warned that the decision, in a "truly unprecedented manner" for a trade case, has implications for national security. The government said that a program under which Russia has agreed to convert weapons-grade, highly enriched uranium into the kind of uranium needed by U.S. utilities could be endangered. Dismantling nuclear warheads, it said, is a more expensive process than simply enriching the uranium as the French company does. It is economically viable only because the United States has the ability to use anti-dumping laws to regulate the entry of low-enriched uranium from foreign sources. The combined cases are U.S. v. Eurodif and USEC v. Eurodif.