Convention on Supplementary Compensation for Nuclear Damage (CSC)

Online Calculator - Article IV (Calculation of Contributions)

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Article IV text

Article IV of the CSC provides that:

1. The formula for contributions according to which the Contracting Parties shall make available the public funds referred to in Article III.1 (b) shall be determined as follows:

(a) (i) the amount which shall be the product of the installed nuclear capacity of that Contracting Party multiplied by 300 SDRs per unit of installed capacity; and
    (ii) the amount determined by applying the ratio between the United Nations rate of assessment for that Contracting Party as assessed for the year preceding the year in which the nuclear incident occurs, and the total of such rates for all Contracting Parties to 10% of the sum of the amounts calculated for all Contracting Parties under sub-paragraph (i).

(b) Subject to sub-paragraph (c), the contribution of each Contracting Party shall be the sum of the amounts referred to in sub-paragraphs (a)(i) and (ii), provided that States on the minimum United Nations rate of assessment with no nuclear reactors shall not be required to make contributions.

(c) The maximum contribution which may be charged per nuclear incident to any Contracting Party, other than the Installation State, pursuant to sub-paragraph (b) shall not exceed its specified percentage of the total of contributions of all Contracting Parties determined pursuant to sub-paragraph (b). For a particular Contracting Party, the specified percentage shall be its UN rate of assessment expressed as a percentage plus 8 percentage points. If, at the time an incident occurs, the total installed capacity represented by the Parties to this Convention is at or above a level of 625,000 units, this percentage shall be increased by one percentage point. It shall be increased by one additional percentage point for each increment of 75,000 units by which the capacity exceeds 625,000 units.

2. The formula is for each nuclear reactor situated in the territory of the Contracting Party, 1 unit for each MW of thermal power. The formula shall be calculated on the basis of the thermal power of the nuclear reactors shown at the date of the nuclear incident in the list established and kept up to date in accordance with Article VIII.

3. For the purpose of calculating the contributions, a nuclear reactor shall be taken into account from that date when nuclear fuel elements have been first loaded into the nuclear reactor. A nuclear reactor shall be excluded from the calculation when all fuel elements have been removed permanently from the reactor core and have been stored safely in accordance with approved procedures.

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Online Calculator

An online calculator has been developed which applies the above formula in Article IV and will enable a State to run scenarios of actual and possible Contracting Parties to the CSC in order to determine the amounts to be contributed to the international fund, in such cases.

As the actual contribution of Contracting Parties is not fixed by the CSC, the actual amount will depend on the number of such Contracting Parties at the time of the nuclear incident and, especially, on the number of Contracting Parties with nuclear reactors.

The amounts resulting from the use of the calculator will, therefore, not be accurate at all times and States should themselves apply the Article IV formula at the time of a nuclear incident.

It should also be noted that until the entry into force of the CSC, the calculator has been developed using information on States' installed nuclear capacity contained in the Agency's Power Reactor Information System (PRIS) database and the Agency's Research Reactor Database (RRDB). Upon entry into force of the CSC, however, the calculator will apply the information on a Contracting Party's installed nuclear capacity, as provided by that Party pursuant to Article VIII of the CSC. In cases where this information has not been provided and for those States which are non-Contracting Parties but have been included in a particular scenario, the information in the PRIS database and RRDB will continue to be used.

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The Agency expressly disclaims all liability with respect to the use of the calculator, any information obtained therefrom and any reliance placed on such information.

The system of compensation established by the CSC envisages two tiers:

1. under Article III, the Installation State must ensure the availability of the first tier of compensation i.e. the national compensation amount;
2. whereas the second tier will come from an international fund to which Contracting Parties are expected to contribute according to the formula specified in Article IV. This second tier of compensation is only needed if the national compensation amount is inadequate to ensure the payment of all claims for compensation for nuclear damage

As the actual contribution of Contracting Parties is not fixed by the CSC, the total amount available will depend on the number of such Contracting Parties at the time of the nuclear incident and, especially, on the number of Contracting Parties with nuclear reactors.

Nuclear and non-nuclear States

In fact, under the formula, ninety percent of the total amount of the international fund will result from contributions calculated on the basis of a State's installed nuclear capacity, whereas the remaining ten percent will result from contributions calculated on the basis of a State's UN rate of assessment. As a result, most of the money will come from the nuclear States, which will have to contribute both on the basis of their installed nuclear capacity and on the basis of their UN rate of assessment. Non-nuclear States will only have to contribute to ten percent of the total fund on the basis of their UN rate of assessment. In addition, non-nuclear States on the minimum UN rate of assessment will not be required to make any contribution.

Nuclear Reactors

It is, moreover, necessary to point out that, although the CSC compensation regime covers damage caused by incidents in (or related to) other nuclear installations also, only nuclear reactors are to be taken into account in order to determine a State's installed nuclear capacity. As a result, nuclear installations other than nuclear reactors are not taken into account in order to calculate a State's contribution to the international fund, and a State having nuclear installations but no nuclear reactors would contribute on the same basis as a genuinely non nuclear State.

Cap on the contributions

Finally, the CSC also envisages a cap on the contributions from any one State, unless that State is the Installation State in relation to the nuclear incident. However, the cap is expected to operate in the early stages of the compensation regime only. Under Article XX, the CSC will enter into force when ratified, or acceded to, by at least five States with at least 400,000 units of installed nuclear capacity. After the entry into force of the convention, and until the convention is ratified by a high number of States with nuclear reactors, the formula for calculating contributions might have created a situation where one or more States with a high nuclear capacity would have been required to provide an excessively large share of the supplementary compensation amount. The cap is intended to avoid this, and will start to phase out when the total installed nuclear capacity of the Contracting Parties reaches the level of 625,000 units.

Allocation of the funds

As for the allocation of the funds for compensation, it should be noted that fifty percent of the international funds is to be used to compensate damage suffered both inside and outside the Installation State, whereas the remaining fifty percent is to be used exclusively to compensate transboundary damage. However, the allocation of the international funds may vary depending on the national compensation amount made available by the Installation State. In fact, if, in the transitional period (which expires on 29 September 2007 (irrespective of the date of entry into force of the CSC)), the Installation State avails itself of the possibility of establishing a national compensation amount lower than 300 million SDRs, the percentage of international funds exclusively available for compensating transboundary damage is to be increased accordingly. If, on the other hand, the Installation State makes available a national compensation amount of 600 million SDRs or higher, then the whole amount of supplementary compensation is to be used to compensate damage suffered both inside and outside the installation State.