In a little-noticed press release, the U.S. Department of Justice announced last December that it had won a guilty plea from the China Nuclear Industry Huaxing Construction Co. Ltd. (or simply Huaxing) for its criminal conspiracy to export to Pakistan’s Chashma II Nuclear Power Plant from the United States high-performance epoxy coatings in violation of U.S. law. The DOJ press release stated:
It is believed that today’s plea marks the first time that a PRC corporate entity has entered a plea of guilty in a U.S. criminal export matter.
The details of the criminal conspiracy read like standard stuff for those accustomed to the laws in question, and how they are violated. Until you consider the sentence above.
It is no small matter. If China cooperated in this case, that’s worthy of note. If they did, why and how, and what else (if anything) was learned as a result about China’s nonproliferation policies and the strength of its commitment to them?
China won membership in the Nuclear Suppliers Group (NSG) in 2004 on the back of many promises made, and at the time, the question in everyone’s mind was what else do they want for Pakistan, after the Chashma I and II NPPs? (Chashma III and IV, naturally.)
Also, with some recent reports surfacing to the effect that China and Turkey are now supporting Pakistan’s entry into the NSG, the question arises, is Pakistan to be admitted to the NSG?
China won a peaceful nuclear cooperation agreement (a 123 agreement) with the United States based on its nonproliferation policy, or one should say revisions made thereto over the course of 13 years. It took the Executive branch from 1985 to 1998 to certify to Congress pursuant to Public Law 99-183 (the law approving the China 123 agreement, as well as relevant sections in the Tiananmen sanctions law) that:
The Government of the People’s Republic of China has provided additional information concerning its nuclear nonproliferation policies and that, based on this and all other information available to the United States Government, the People’s Republic of China is not in violation of paragraph (2) of section 129 of the Atomic Energy Act of 1954.
Now, does the epoxy conspiracy cast doubt on Chinese nonproliferation policy–i.e., the policy that was the subject of the 1998 determination/certification–or, if there was Chinese cooperation, does it highlight a rare case of cooperation in such matters?
What is the present position of the U.S. government on further Chinese nuclear exports to Pakistan beyond Chashma I and II?
Has any information that was obtained by the U.S. government in connection with the epoxy conspiracy caused the U.S. government to review whether or not China is or may be in violation of section 129? (That’s very unlikely to be the case: Chashma I and II were “grandfathered” at the time of the PRC’s entry into the NSG, and given that they are both safeguarded under Pakistan’s INFCIRC/66 agreement, as civilian NPPs, China is unlikely to be in violation of section 129 concerning lawful exports to either NPP; and the plea makes no mention of items or conduct falling under section 129. The nexus, however, between the Huaxing plea and the complicated past and present PRC-Pakistan nuclear relationship raises its profile.)
It doesn’t take a law degree or years of asking questions of any administration to know that the answers to the above questions are probably: Not really; we don’t like it, but prefer not to discuss it; and no. With 29 reactors under construction in China, some of them under U.S. license (the first reactor export licenses not being issued until 2004, and with key contracts on the line in 2013-2015), some would no doubt prefer not to highlight this case.
If the guilty plea rests on PRC cooperation, that’s something that the Justice Department could probably detail before (a) the expiration of the U.S.-China 123 agreement in 2015 and (b) the PRC-Turkey bid, if it’s real, results in Pakistani membership in the NSG, or the crafting of U.S. instructions for the U.S. representative to the NSG on the matter are finalized.