SHANTI 2025: Umbrella law to go ‘pragmatic’ on tricky liability clause, right to recourse
The bill would also create an Atomic Energy Compensation Advisory Council to adjudicate all relevant disputes, establish a Nuclear Damage Compensation Commission for adjudication in cases of serious nuclear damage, give legal status to the Atomic Energy Regulatory Board, and create a mechanism for the Electrical Appellate Tribunal in electrical matters related to nuclear energy.
The regulation will also introduce a ‘pragmatic civil liability regime for nuclear damage’ and limit the jurisdiction of civil courts in matters related to nuclear energy, as well as addressing the thorny issue of ‘rights of recourse’ for operators, ET has learnt.
The new legislation grants private sector operators the right to build, own, operate or decommission a nuclear power plant or reactor; Nuclear fuel manufacturing, including conversion, refining and
transportation or storage of nuclear fuel or spent fuel, as well as enrichment of uranium-235 to this threshold value, import, export, purchase or possession of nuclear fuel and anticipated equipment, technology/software for development and production.
C.lause Bill 9 will also open up R&D in nuclear energy by allowing anyone to engage in research, development, design and innovation on matters related to nuclear energy and peaceful radiation, except for activities of a sensitive nature.
However, the Center will retain control/oversight over various sensitive areas such as Heavy water production and its remediation through isotopic separation, management of spent fuel cycle, source material in any form and fissile material. The Center will also reserve the right to prepare rules to ensure the safety of radioactive materials; The rights to inspect any consignment, package, transport or facility, to maintain a national register of radioactive substances, as well as to take necessary steps to prevent radiation hazards.
This is separate Article Articles 28 and 29 of the Bill will give supervisory powers to the Central Government and the Board and will also notify the Central Government and the Board of any nuclear or radiological incident, etc. It will give the authority to conduct an investigation in case of a complaint or occurrence regarding the incident.
The right of recourse, which is the most important key point in the CNLD Law, will also see a change.
SHANTI offers in 2025 clause Article 16 states that the operator of a nuclear facility shall have the right to recourse where such a right is expressly provided for in a written contract or where the nuclear incident results from the act or omission of a person committed with the intention of causing nuclear damage.
It leaves out the thorny provision of the CNLD Law, which also allows for recourse if the nuclear incident results from the ‘intentional act or gross negligence of the supplier or employee of materials, equipment or services’.
Article Clause 56 of the Bill also empowers the Central Government to establish a Nuclear Damage Compensation Commission, taking into account the extent and severity of nuclear damage; However, such a claim must be made within ten years for property damages and twenty years for personal injuries from the date of the incident.
The issue of liability was also discussed.
The bill calls for the introduction of an insurance policy or similar financial security covering the operator’s liability; Nuclear facilities owned by the Central Government are exempt from this obligation. The maximum amount of liability for each proposed nuclear incident is equivalent to three hundred million rupees. Penalties for minor to serious violations range from Rs 50 lakh to Rs 1 crore, while for Reactors with thermal power above 3600 MW, the liability of Operators is capped at Rs 3,000 crore.
However, the Center will also establish a Nuclear Liability Fund to cover liability in case the liability exceeds an operator’s liability amount.
Specified in the Second Schedule; where it has its own nuclear facility; and in cases where the compensation to be given in accordance with this Law exceeds the specified amount. The proposal states that in such a scenario, the Center may seek funds under the Convention on Supplementary Compensation for Nuclear Damage signed by India in Vienna.
The new bill also addresses a key industry demand to limit the jurisdiction of courts.
Article 81 of the Bill provides that no civil court shall have jurisdiction to hear any suit or proceeding over which the Central Government, the Board, the Nuclear Damage Claims Commission or the Claims Commissioner has jurisdiction.
To judge according to the bill. It also provides that no injunction shall be granted by any court or other authority in respect of any action taken or to be taken pursuant to any power conferred by or under the Bill.
Article 82 of the Bill provides for the protection of acts done in good faith and provides that no suit, prosecution or other legal action shall be taken against the Central Government or the Board or Council or any person acting on their behalf for anything done or intended to be done in good faith under the Bill or the rules and regulations made under it.
