to source materials, nuclear fuels, and dangerous facilities. It is important to understand the reasons which have led to the conclusion that "ownership" should be vested in the international agency in respect to materials and certain facilities and to understand the sense in which this expression is used.

The First Report contained an examination of the controls neces sary at the separate stages of production and use of atomic energy and left the co-ordination of controls and the general requirements of international security for subsequent study. Such study has established the necessity for international control and allocation of the quantities and locations of uranium and thorium which are to be separated from their place in nature, the time and place of the further processing and purification of source materials, and the size, use, and disposition of working stocks and stocks in transit. Without such comprehensive international control of the flow of source materials from the first point where they are capable of being diverted, there would be a serious risk of the diversion of source material or of the accumulation of stocks with a view to subsequent diversion or seizure. The basic policies and provisions governing the exercise of this international control and direction must be specified in the treaty or convention and implemented by the international agency. To administer these controls effectively, the international agency, acting as trustee for all the signatory nations jointly in accordance with the policies set forth in the treaty or convention, must be given indisputable control of the source materials promptly after their separation from their natural deposits.

If ownership of source material, after separation from its place of deposit in nature, were to remain with the nation, it might be left open to doubt as to whose decision would prevail in regard to the disposition of this material. International security requires that there be no doubt that, within the terms of the treaty or convention, the right of decision in these matters must lie with the international agency.

It has, therefore, been decided that ownership of source material must not be vested in the nation or any individual under the terms of the treaty or convention. No nation or person would, therefore, be able lawfully to possess or dispose of source material after it had been mined. The mere possession or movement of any such material without the consent of the agency would be unambiguous evidence of violation of the treaty or convention.

With regard to nuclear fuel and to facilities producing or utilizing nuclear fuel, it is proposed that, in the interests of international security, the treaty or convention and the agency, in implementing the terms of the treaty or convention, must determine the number of facilities to be established in each nation and the agency must manage their operation. On the other hand, since nuclear fuel and all such facilities would necessarily have to be located on some national territory, the question arises whether international security would permit that nations should have any proprietary rights or right of decision arising therefrom with regard to nuclear fuel or to the facilities located on their territory. If national or private ownership were permitted, it might be argued that the nations might lay a claim to source material, nuclear fuel, or dangerous facilities located on their territory

in such a way as to endanger international security. It was, therefore' concluded that it is necessary for the international agency to have, in addition to those duties of management as defined in the First Report, the duty to make and to carry out decisions in implementation of the quotas, provisions, and principles set up in the treaty or convention, regarding the production, distribution, and stockpiling of nuclear fuel and the distribution and utilization of dangerous facilities involving nuclear fuel. This duty to make decisions will be exercised in accordance with the principles embodied in the treaty or convention. If national or private ownership were permitted, it would lead to controversy and make it impossible for the agency, in accordance with quotas, provisions, and principles set up in the treaty or convention, to exercise sufficient control to ensure security. It was, therefore, concluded that nations or persons should not own source material, nuclear fuel, or dangerous facilities.

If ownership of these materials and facilities is to be denied to nations or persons under the terms of the treaty or convention, it might seem to follow that such ownership must of necessity be attributed to the agency. On the other hand, the agency will be very closely controlled by the terms of the treaty or convention precisely in respect to those decisions which normally go with ownership, namely, the rights of disposition. This fact might be expressed by saying that the agency would hold all dangerous materials and facilities in trust for the signatory states and would be responsible for ensuring that the provisions of the treaty or convention in regard to their disposition are executed. It is in this sense that the phrase "ownership by the agency" is to be understood in what follows. There can, of course, be no question that any nation or person has any right in any circumstances to dispose of or to possess these materials or facilities.

It will be seen from the chapters which follow that ownership by the agency of source materials or nuclear fuels includes the exclusive right to move or lease the materials, the right to use and to produce energy from them, and the same rights for all products formed from them. Ownership also includes the principle that no disposition of material can be made without the permission of the agency. It is proposed that the agency should acquire ownership, for a price to be agreed, of source material from the time it is removed from its place of deposit in nature or, in case of source material containing other important constituents, from the time those constituents have been extracted. The agency will not be permitted to sell these materials but could lease them for authorized uses.

Likewise, ownership by the agency of dangerous facilities includes the right of the agency to make decisions regarding their allocation, construction, and operation, within the terms of the treaty or convention. The useful and non-dangerous products of these plants would be made available to the nations under fair and equitable arrangements. The location and type within a nation will be decided by agreement with the nation concerned. Ownership by the agency of facilities within a nation includes rights of possession, operation, and disposition subject to the terms of the treaty or convention. The agency could not sell dangerous facilities. Ownership by the agency of a power plant would not include the right to shut down such a

plant at will. Ownership does include the responsibility to operate facilities in such a way as not to endanger health and the responsibility for any damage.

While vesting ownership in the agency, in the sense of a trust exercised on behalf of signatory states jointly, in order that the agency should have the final right of decision in regard to the disposition of source materials, nuclear fuels, and the operation of dangerous facilities, it was also realized that the nations could not be expected to agree to give unlimited discretionary powers to an international agency. The following chapters, therefore, set out in detail the provisions which are to govern the location, mining, production, distribution, and use of source material and nuclear fuel, as well as dangerous facilities. It would then be the duty and responsibility of the international agency to implement these provisions in accordance with the terms of the treaty or convention.

These chapters, coupled with the First Report, give an outline of the major provisions from the point of view of security that must be incorporated in a plan for the control of atomic energy. It is recognized, however, that the treaty or convention which would put such a system of control into effect cannot cover all the situations that might arise between the signatory states and the agency. must be stated at this time that, whatever legal issues might arise in this connection, nations cannot have any proprietary rights or rights of decision arising therefrom over source materials, nuclear fuels, or dangerous facilities located within their territory.

(h) Clandestine Activities. The study of the problem of security in the light of the additional considerations described at the beginning of this chapter does not affect the problem of the detection of clandestine activities. The measures provided for in the following chapters, therefore, represent only an elaboration of those recommended in the First Report. The purpose of these measures is to give the agency the duties and the powers in order to deter nations which might be tempted to conduct clandestine operations, to seek out and to detect such clandestine activities if a nation were to conduct them, and to dispel suspicions and false accusations.

It is obvious that no feeling of security could be established in the world if nations could reserve the right to prohibit access to certain parts of their territory. Nevertheless, it is also impracticable to subject the whole of the territories of the contracting nations to detailed inspection for, apart from the obvious political disadvantages, no international agency could ever be in a position to fulfil such a task. Thus, the exercise of the right, which the international agency must possess, of determining on the spot whether a nation is conducting clandestine preparations for atomic warfare, would be subject to various procedures, according to the nature of the territory or the building inspected, and these procedures would be designed to guarantee nations and individuals against abuses on the part of the agency and to conform, as far as possible, with national legal procedures.

It is recognized that these procedures will have to be considered from a juridical standpoint in order that they might be defined in legal terms capable of juridical interpretation, it being understood that the substance of the proposals should not be altered.

242. THIRD REPORT OF THE ATOMIC ENERGY COMMISSION TO THE SECURITY COUNCIL, MAY 17, 1948 1

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The Atomic Energy Commission reports that it has reached an impasse. In almost two years of work the Commission has accomplished much and has succeeded in making clear the essentials of a plan for the control of atomic energy, in fulfillment of the objectives of the resolution of the General Assembly of 24 January 1946. Nevertheless, it considers that it cannot now prepare a draft treaty "incorporating its ultimate proposals" as urged by the resolution of the Security Council of 10 March 1947.

The difficulties which confront the Commission were first evidenced when the plan under consideration by most of the governments members of the Commission was rejected by the USSR, "either as a whole or in its separate parts," on the ground that such a plan constituted an unwarranted infringement of national sovereignty. For its part, the USSR insisted that a convention outlawing atomic weapons and providing for the destruction of existing weapons must precede any control agreement. The majority of the Commission considered that such a convention, without safeguards, would offer no protection against non-compliance.

This initial divergency of view did not deter the Commission from pursuing its task in the hope that the disagreements might be resolved. as a result of further studies. Accordingly, the Commission decided to defer the consideration of the political aspects of the problem until it had first determined whether control of atomic energy was practicable from a technical point of view. In September 1946 the Scientific and Technical Committee reported unanimously that

"we do not find any basis in the available scientific facts for supposing that effective control is not technologically feasible."

During the remainder of 1946, the Commission continued to study the technical and scientific aspects of control and adopted the broad outlines of a control plan set forth in the General Findings and Recommendations of the First Report. In 1947 it elaborated specific proposals in a Second Report which show, on many points, how control could be carried out.

The USSR abstained from voting on the First Report and voted against the Second Report.

In February 1947, the USSR submitted Amendments and Additions to the General Findings and Recommendations of the First Report, and in June 1947, it submitted control proposals of its own. The discussion of the USSR Amendments and Additions did not lead the Commission to revise its General Findings and Recommendations. The USSR proposals of June 1947 have been analyzed in detail. In April 1948 they were rejected by a 9-2 vote, in the following terms: "They ignore the existing technical knowledge of the problem of atomic energy control, do not provide an adequate basis for the effective international control of atomic energy and the elimination from

AEC/P.V. 15, May 7, 1948. This document is the Three Power declaration which was presented to the Commission on May 7 and adopted as the body of a Third Report at the Commission's meeting on May 17, 1948. The fully assembled Third Report contains the proceedings of the Commission and a series of annexed documents.

national armaments of atomic weapons, and, therefore, do not conform to the terms of reference of the Atomic Energy Commission." The analysis of the technical requirements of atomic energy control has been pursued as far as is possible. Unfortunately, this analysis has not led to agreement even on the technical aspects of control. During more than 200 meetings of the Atomic Energy Commission and its various committees, the USSR has had time to study the technical knowledge available to the Commission, to review its own position in the light of such knowledge, and to appreciate that the admittedly far-reaching proposals sponsored by the majority are based on the scientific and technical facts. But the USSR has not changed its fundamental position.

Thus, after twenty-two months of work, the Commission finds itself confronted by virtually the same deadlock that stultified its initial discussions. The Government of the USSR itself acknowledges the deadlock. It is now apparent that this deadlock cannot be broken at the Commission level.

Both political and technical considerations demand that no important areas of the world be outside the control system. It is therefore evident that the full co-operation of the USSR is indispensable for the establishment of a system of control which would prevent an atomic armaments race.

Whether the functions and powers of the International Control Agency as elaborated by the majority are politically acceptable or not, they provide the technically necessary basis for an effective control of atomic energy. The question is not whether those measures are now acceptable but whether governments now want effective international control.

The problems which have not been elaborated in detail, i. e., organization and administration, financing, strategic balance, prohibitions and enforcement, and the stages of transition from the present situation to one of full international control, are of a different nature. These questions do not affect the basic nature of the problem of control. Some questions, such as stages, which only concern the period of transition to full international control, will be conditional on future technological developments and the conditions of world security. The same considerations apply to the question of the strategic balance to be established in the location of nuclear materials and nuclear reactors between one part of the globe and another. Others, such as organization and administration of the agency-on which inconclusive discussions have recently taken place and the question of the agency's finances, depend almost entirely on the existence of prior agreement on the nature and extent of the control system. Indeed, until agreement on the basic principles of control has been reached, the elaboration of proposals to cover these remaining topics would be unrealistic and would serve no useful purpose. On the other hand, given such agreement, solutions to these problems could be worked out.

The discovery of atomic energy has confronted the world with a new situation. The Atomic Energy Commission has studied and made recommendations on the international control of atomic energy to meet this situation. It has rejected proposals which do not meet the known facts of the problem.

By concentrating on the technical facts which, irrespective of any political situation, must be met by any satisfactory plan of control,