Hyde Act, 123 Agreement and India

Excerpts of Shri P. Chidambaram's (Finance Minister of India) speech on the Motion of Confidence in the Lok Sabha

So much has already been said about civil nuclear cooperation. I do not think it is necessary to go over the technical or the legal aspects once again. Let me emphasise that we have not one but three agreements on civil nuclear cooperation. We have entered into an agreement with the United States on July 20, 2007; with France on January 25, 2008 and with Russia on February 11, 2008.

India has been barred from nuclear commerce. We cannot access nuclear reactors or nuclear fuel or nuclear technology. If we can end that isolation, we can secure cooperation from the US, France and Russia. It is also possible to secure cooperation from some other countries such as Australia, Canada, China, Japan and the United Kingdom. *****
The US Atomic Energy Act, 1954 prohibits cooperation with any country until certain conditions are fulfilled. This is contained in Section 123. However, Section 123 authorises the President to exempt a proposed agreement for cooperation from any of the requirements.

The Hyde Act was passed in 2006 and became law in December, 2006. President Bush issued a signed statement asserting that he would not follow portions of the Act that intruded upon his plenary constitutional prerogatives and would treat certain sections as advisory.

The practice of issuing signed statements is constitutionally sound and well established in the United States.

The 123 Agreement between India and the US was agreed on August 1, 2007.

In the United States they have understood the Hyde Act and the 123 Agreement in the following manner.

As far as the White House is concerned, the 123 Agreement is consistent with the Hyde Act, when properly construed, and merely fleshes out the details of the US India nuclear cooperation. According to them, the proper legal position is that the 123 Agreement builds upon the Hyde Act. Moreover, once Congress approves the 123 Agreement, then the Agreement will delineate the specific rights and responsibilities of the US and India as the prevailing law that governs and controls the deal’s implementation.

How do we understand it in India?

Article 2.2 of the 123 Agreement specifically states that it is an agreement “to enable full civil nuclear energy cooperation between the Parties.” It contemplates such cooperation on “an industrial or commercial scale.” Under Article 16, the agreement shall enter into force on a date on which the Parties exchange diplomatic notes informing each other that they have completed all applicable requirements. The legal status of the 123 Agreement is that it has not yet entered into force and, even after it comes into force, India and the United States would have to enter into further agreements to fulfil the objectives on an industrial or a commercial scale. Therefore, the 123 Agreement is an enabling agreement and no more. “Operationalising” the 123 Agreement would mean that the Parties would have to complete all pre-requirements, exchange diplomatic notes and agree upon the date on which the 123 Agreement would come into force. Even after it comes into force, there is nothing automatic, and it would be necessary to enter into further agreements.

We have to apply the principles of international law and the principles of interpretation of statutes. Article 16.4 of the 123 Agreement states that the “Agreement shall be implemented in good faith and in accordance with the principles of international law.” Under customary international law as well as the Vienna Convention on the Law of Treaties, 1969, a party may not invoke the provisions of its internal law as justification for its failure to perform a treaty. When the 123 Agreement is voted “up” by the US Congress – that is, ratified by the US Congress – it will be the last expression of the legislature on the subject and will prevail over any earlier domestic law. Besides, under Article VI(2) of the US Constitution, all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land. In any view of the matter, the Hyde Act, which is a domestic law, cannot bind India and cannot interfere with the implementation of the 123 Agreement which, when ratified by the US Congress, will be a bilateral treaty between two sovereign countries.
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