(d) Areas containing source material.-Subject to the limitations and procedures specified in chapter 6, the agency shall conduct routine inspections and surveys and intensive explorations of areas known to contain significant quantities of source material and of all mines in such areas. The routine inspections and surveys will be primarily for the purpose of preventing or detecting clandestine activities in these areas. The intensive explorations will be primarily for the purpose of checking and supplementing existing information as to the location, amount, character, concentration, and mode of occurrence of the source material. The agency shall analyse, co-ordinate, compile, and publish all data concerning known supplies of source material.

IV. The international agency shall become the sole owner of all source material not containing other important constituents, from the time the source material is removed from its place of deposit in nature, and shall specify in each case the concentration at which it shall take possession.

V. In the case of source material containing other important constituents, the international agency shall assume ownership of the source material as soon as these constituents have been extracted. If the owning nation or person does not extract these constituents within a reasonable period of time, the agency shall have authority to assume ownership and take possession of the source material. In any case, nations will not dispose of or transfer any source materials without the consent of the agency. The agency shall also have the authority to assume ownership and take possession of source material containing other important constituents if such action is necessary for security. Factors to be considered by the agency in such cases include the concentration of key substances in the source material, the nature of the mining and milling processes, the extent to which the concentration of key substances is increased by these processes, the scale of the opera tions, and the handling, transport or trans-shipments involved before chemical processing is performed. The agency shall give notice to the nation before taking such action, and the nation shall have the right to appeal to an appropriate international body against the decision of the agency. (See item A.3 (d), "Definition of types of operating decisions subject to review and of those not subject to review", and item A.3 (e). "Determination of review body or bodies and of principles governing review", of the summary of principal subjects.)

VI. The international agency shall be authorized to purchase source material in the locality and country containing deposits of it, in cases where such purchase is agreed to by the nation concerned and by the agency. In such cases, the agency shall be authorized to dig, develop. and operate mines or arrange therefor.

VII. By agreement with the nation concerned, the agency shall be authorized to construct mills and establish dumps, or to purchase 1 acquire, lease, develop or operate, or contract, or otherwise arrange, fcr the development or operation of, source material mines, mills, and dumps.

VIII. In regard to the mines, mills, or dumps operated by the international agency, the agency shall:

(a) Institute accounting procedures and other safeguards for the control of source material;

The first sentence as approved by the Commission reads:

"The international agency shall be authorized to purchase source material in place and land containing deposits thereof

(b) Prevent the waste of source material; and

(c) Be authorized to sell other important constituents.

IX. Mines, mills, and dumps which handle or contain source material and which are operated by nations or persons shall be operated only under license from the international agency. Such licenses shall include the following provisions:

(a) The agency shall require reports from nations as to description, ownership, location, transfer, and use of such mines, mills, and dumps. (b) The agency shall make inspections and conduct accounting for materials, including independent sampling, weighing, assaying, and analysis of materials and tests of equipment, and shall maintain laboratories and technical personnel for these purposes.

(c) The agency shall maintain guards to prevent diversion of source material.

(d) The agency shall require operating procedures, schedules, and equipment necessary to ensure control, to facilitate accounting, and to prevent loss or waste of source material.

(e) The agency shall reserve the power to modify regulations and to suspend or revoke licenses in case of violation by the licensee. In case of refusal by the agency to grant a licence applied for by a nation, or in case of suspension or revocation of a licence granted, the applicant or licensee shall have the right of appeal to an international court, and the agency shall have the right to maintain its control measures. (See item A.3 (d), "Definitions of types of operating decisions subject to review and of those not subject to review", of the summary of principal subjects.)

X. The International agency shall assign annual quotas for the production of source material to nations in whose territory deposits or dumps are located. These quotas shall be determined in accordance with the general principle to be laid down in the treaty or convention, that comparable national deposits throughout the world should be depleted proportionately. The general procedure for assigning quotas shall be as follows:

(a) The agency shall estimate the reserves of source material contained in deposits and dumps throughout the world.

(b) The agency shall estimate the annual world needs for source material, taking into account its conservation for future uses.

(c) The agency shall determine from time to time the minimum concentration of source material which should be exploited, taking into account questions of economy and of strategic distribution. (See item B.1, "Principles governing the geographical location of dangerous activities and stockpiling", of the summary of principal subjects.) (d) The agency shall assign annual quotas to nations on the basis that the ratio of the quota of a nation to its currently exploitable reserves shall be approximately the same as the ratio of the annual world needs to the total currently exploitable world reserves.

(e) In assigning quotas, the agency shall specify the concentration of key substances which it requires, as well as the total quantities. (Nations shall be obligated to supply to the agency the annual quotas of source material assigned to them.

(g) Quotas may be exceeded only in cases where other important constituents are being extracted.

(h) Annual quotas shall be assigned to any deposits or dumps of source material owned by the agency on the basis that the ratio of the

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quota of an individual deposit or dump to its currently exploitable reserves shall be approximately the same as the ratio of the annual world needs to the total currently exploitable world reserves.

(2) Annual quotas may be adjusted or averaged over a period of years by the agency to accord with practical mining considerations. XI. The international agency shall compensate the owner of a source material mine for any losses suffered as a result of a shut-down or a change in operating policy required by the agency and for expenses that may be incurred in maintaining the mine in safe condition for future operations. The amount of such compensation or maintenance shall be decided by negotiation between the owner, the nation in whose territory the mine is situated, and the international agency, or in the event of failure to reach agreement, by arbitration. or in the last instance by an international court. (See item B.2, "Financial and budgetary organization", of the summary of principal subjects.)

XII. The international agency shall give fair and equitable compensation for source material determined by agreement with the nations concerned. The concentration of key substances in the source material shall be one of the elements determining the compensation. Should the agency acquire source material still containing other important constituents, the value of these constituents shall be taken into account in determining the compensation. If no agreement can be reached, the nature and amount of compensation shall be determined by arbitration or in the last instance by an international court. (For financial arrangements, see item B.2 of the summary of principal subjects.)

XIII. The international agency shall be authorized to make available source material in limited quantities to nations for use in research on, or development of, atomic energy (in accordance with chapter 2) or for use outside the field of atomic energy subject to licensing aud accounting or inspection of such uses. (For the principles to govern the distribution of nuclear fuels, see chapter 5.)

XIV. The international agency shall have the following powers and duties in regard to the transport of source material:

(a) The agency shall be authorized to arrange with the national or international authorities for the transport of source material and for the construction and operation of means therefor.

(b) The agency shall inspect facilities for the transport of source material, account for source material in transit, assign guards, and take, in concert with the national authorities, other appropriate protective measures to the extent necessary to prevent unlawful transport of source material and to prevent loss or diversion of source material during transit.

XV. Nations and persons shall be prohibited from owning or possessing any mineral deposit known to contain a significant quantity of source material, or any source material mine, mill, or dump, without reports being made to the international agency.

XVI. Nations and persons shall be prohibited from operating any source material mine, mill, or dump, except as authorized by licence or regulation of the international agency.

XVII. Nations and persons shall be prohibited from owning source material removed from its place of deposit in nature, except in the

case of source material containing other important constituents (see specific proposal V above).

XVIII. Ñations and persons shall be prohibited from possessing, storing, transporting, or using a significant quantity of source material removed from its place of deposit in nature, except as authorized by licence or regulation of the international agency.

XIX. Nations and persons shall be prohibited from:

(a) Seizing, tampering with, or interfering with any source material deposit, mine, mill, or dump, or any significant quantity of source material;

(b) Obstructing the operation of any source material mine or mill; and

(c) Damaging or destroying any source material deposit, mine, mill, or dump, unless so authorized or directed by the international agency.

XX. The international agency shall have the duty to seek out any clandestine activities which involve source material. To this end, the agency shall have the power to conduct ground, aerial, and other surveys, exploratory operations, accounting for materials, and inspections. These may be either of a routine character in the case of areas known to contain source materials, or of a special character when deemed necessary by the agency. (For rights of, and limitations on, the international agency and its personnel in carrying out such powers and duties, see chapter 6.)

XXI. The international agency and its personnel, officers, and agents, shall have, and nations shall be obligated to provide them with, unimpeded rights of ingress, egress, and access to the extent necessary to carry out the powers and duties of the agency specified in this paper. (For rights of, and limitations on, the international agency and its personnel in carrying out such powers and duties, see chapter 6.)

CHAPTER 4: PROCESSING AND PURIFICATION OF SOURCE MATERIAL

I. The international agency shall require initial reports from nations and persons as to the location, description, and ownership of all source material refineries and chemical or metallurgical plants for treating key substances. The agency shall require such additional reports, periodically and from time to time, as it desires in regard to the operation of any licensed facilities.

II. The international agency shall have the authority to determine, in each case, whether it shall own, operate, and manage any source material refinery or whether it shall license the operation of the refinery by a nation or person, with the exception of the refineries specified in specific proposal III below. In the event that the agency determines to license the operation of such a refinery, the agency shall have the following powers and duties, for which provisions shall be made in the licence:

(a) The agency shall make inspections and conduct accountings for materials, including independent sampling, weighing, assaying, and analysis of materials and tests of equipment, and shall maintain independent laboratory facilities and technical personnel for these

purposes.

(b) The agency shall maintain guards to prevent diversion of material containing key substances.

(c) The agency shall require shut-downs or shall modify schedules for purposes of clean-up and accounting at appropriate times or in the event of significant accounting discrepancies.

(d) The agency shall require operating procedures and equipment to ensure necessary efficiency and complete control and to prevent loss or waste of key substances. In the case of refineries which may be built or modified for operation under licence, the plans shall be approved by the agency.

(e) The agency shall have unrestricted access to all equipment and operations.

(f) The agency shall specify the operating schedules and shall make such changes in schedules as may be necessary for proper coordination with other activities of the agency.

(g) The agency shall specify the concentration of key substances desired and shall take immediate possession of refined materials as produced.

(h) The agency shall reserve the power to modify the provisions of the licence and to revoke the licence, taking over the ownership, operation, and management of the refinery, with due compensation to the owner. (For questions of appeal see item A.3 (d) "Definition of types of operating decisions subject to review and of those not subject to review", of the summary of principal subjects.)

III. Refineries customarily engaged in the processing of source material for the purpose of extracting other important constitutents will normally be owned, operated, and managed by nations or persons, and, in that event, shall be granted licences by the agency for this purpose. The agency shall require, however, that the other important constituents leaving the refinery should contain neither significant percentages nor significant total amounts of key substances. In cases where licences are granted, the agency shall have the following powers and duties, for which provisions shall be made in the licence. It will be understood that the stringency required in the application of these provisions may be found by the agency to depend on whether key substances are removed in the form of concentrates during processing or whether the key substances appear in the waste or tailings of the process.

(a) The agency may set a reasonable time limit for the extraction of the other important constituents, in order to meet established quotas for the production of key substances (see chapter 3) or to prevent dangerous accumulations of source material. (See item B.1, "Principles governing the geographical location of dangerous activities and stockpiling", of the summary of principal subjects.)

(b) The agency shall make inspections and conduct accountings for key substances, including the independent sampling, weighing, assaying, and analysis of materials and tests of equipment, and shall maintain independent laboratory facilities and technical personnel for these purposes.

(e) The agency shall maintain guards to prevent diversion of source material.

(d) The agency shall be authorized to require shut-downs or other suitable measures for purposes of clean-up and accounting at appro