Verbatim, as delivered

Chairman Berman’s opening statement at hearing, “Nuclear Cooperation with

the United Arab Emirates: Review of the Proposed U.S.-UAE Agreement”

The purpose of today’s hearing is to examine the proposed “Agreement for Cooperation between the Government of the United States of America and the Government of the United Arab Emirates Concerning Peaceful Uses of Nuclear Energy,” and the whole variety of issues that are associated with that proposed agreement.

This marks the first appearance before Congress by the new Under Secretary of State for Arms Control and International Security, our former House colleague, our dear friend, California Representative Ellen Tauscher.

Madam Under Secretary, congratulations from the entire committee on your new appointment, and on your wedding – two vows on the same day. This is a wonderful place to take a honeymoon. And in addition to our congratulations to you and our real joy at the fact that, number one, you are doing this very important job, and secondly that there is life for former members of Congress, I want to offer my congratulations to the Obama Administration on the framework for a new nuclear arms reduction treaty to replace the 1991 Strategic Arms Reductions Treaty, or START, which expires in December.

As was made clear in our hearing that we had two weeks ago, it is absolutely vital to our national security to preserve the gains of the START treaty and to further reduce the U.S. and Russian nuclear arsenals.

There is no question but that there is a clear linkage between our nuclear nonproliferation and arms control policies, and we ignore that at our peril.

On to the UAE agreement.

Under U.S. law, a civilian nuclear cooperation agreement is required before we can transfer significant nuclear equipment and materials to a foreign nation.

Often referred to as a “123 agreement” after Section 123 of the Atomic Energy Act, it provides the legal framework for U.S. companies to export controlled civil nuclear goods.

By itself, a 123 agreement transfers nothing; all U.S. nuclear sales and exports must go through their own licensing review and approvals before they leave our shores.

If a proposed agreement complies with all the requirements of Section 123 – as this one does -- then it can be brought into force by the President, unless Congress enacts a joint resolution of disapproval within 90 days of continuous legislative session following its submission. Based on our mathematical geniuses’ calculations, and assumptions regarding the legislative schedules, the review period for the UAE agreement will end on October 17.

This is the first proposed U.S. nuclear cooperation agreement with a Persian Gulf state. As such, it inevitably raises questions about the broader implications of civil nuclear power in that volatile region, home to a number of terrorist groups and an Iran seemingly determined to acquire a nuclear weapons capability.

There are those, both inside and outside Congress, who would clearly prefer that the region stay nuclear-free, not just of weapons, but also of reactors and related facilities.

I share their concerns. But there are multiple suppliers of civil nuclear power reactors in the world today. Both France and South Korea have already concluded similar cooperation agreements with the Emirates.

Moreover, many of the Gulf states, the UAE included, have ample financial means to buy from whomever they choose, under whatever terms those vendors are willing to offer.

It is unlikely that the United States would be able to bring sufficient diplomatic pressure to bear against France, Russia, Canada, South Korea and all the others that could do this to convince them not to sell civil nuclear equipment or fuel to the UAE and other Gulf states, all of which are parties to the Non-Proliferation Treaty, or NPT.

That is the context in which we consider this agreement.

Some express concerns that 123 agreements encourage or enable the proliferation of nuclear weapons, as civilian reactors and some of their associated facilities can also produce material for a nuclear bomb if diverted from peaceful use.

In that context, it is important to note that the nonproliferation conditions of the proposed US-UAE Agreement go beyond those required by the NPT, beyond those of the Nuclear Suppliers Group, and beyond those of even our own laws.

It contains, for the first time in any U.S. nuclear cooperation agreement, a binding legal commitment by the foreign recipient not to engage in any uranium enrichment or spent-fuel reprocessing activities, nor to have any facilities for such activities.

If the UAE violates this provision, then the U.S. would have the legal right to terminate the agreement, prohibit all current and future transfers to the UAE, and demand the return of all equipment, material, and facilities previously provided.

This is the same so-called “take-back” right that is normally reserved as a penalty for a nuclear test or a major violation of an IAEA safeguards agreement.

I believe any future U.S. 123 agreement in the region -- with Jordan, Kuwait, and other states that are seeking it -- should follow this model.

Indeed, this model could even be applied if one day Iran truly changes from pursuing a nuclear weapons capability to a country whose deeds match its own words in terms of its desire for nuclear energy.

Other supplier states will hopefully follow our lead and include the no-enrichment/no-reprocessing obligation in their own nuclear cooperation agreements.

For me, the fundamental issue is not the substance of the agreement itself. It is, I believe, the best one we have entered into. Rather, it is the extent to which the UAE has been a reliable partner of the United States in working to prevent Iran’s efforts to develop a nuclear weapons capability.

For many years, Iran has sought to use the UAE as a transit point to illicitly procure items to support its nuclear and other WMD programs; expand its conventional military programs; and even to acquire electronics to incorporate into Improvised Explosive Devices -- IEDs -- which have killed and maimed U.S., Coalition and Iraqi soldiers and civilians in Iraq

Iranian-affiliated banks continue to operate in Dubai, several of which have been sanctioned under U.S. anti-terrorism laws as recently as last May.

By all accounts, the UAE has significantly improved its performance in preventing illicit shipments of militarily-sensitive goods to Iran over the past two years.

Yet, questions remain about the extent of the UAE’s commitment, as well as the pace at which it improves its export control capabilities.

For example, why is the UAE moving so slowly to implement the comprehensive export control law it passed last year?

The Obama Administration notes that the UAE considers Iran to be both its most significant security threat, but also an important trading partner with which it cannot cut ties.

So how will the UAE strike a balance between not antagonizing Iran and supporting U.S. efforts to constrain the development of Iran’s nuclear weapons capabilities?

How much leverage does this agreement give the United States to help persuade the UAE in this area?

And do we have more leverage before or after this nuclear cooperation agreement goes into force?

In closing, let me note that the Committee held a classified briefing two weeks ago on some of these issues. And earlier, the committee and I, myself, have received a number of briefings on these issues that I’ve just raised.

I know we can’t get into classified information in this open hearing, but to the greatest extent possible, I hope we can use this as an opportunity to address some of the critical questions about this important nuclear cooperation agreement.