WWWs of India’s CLND Act

//WWWs of India’s CLND Act

Understanding What’s, Why’s and Who’s of the Act is Essential to Remove Misconceptions

There have several doubts and misconceptions, misinterpretations and misrepresentations because of the controversies surrounding CLND issue in India.

However, the Act was essentially legislated to bring in much needed transparency to compensate victims in case of any nuclear disaster in India. This was done in line with the internationally accepted protocols to enable India’s entry as a state party to the international Convention on Supplementary Compensation(CSC).

So, was the Act brought in to facilitate or hamper participation of nuclear suppliers?

Of course, the Act’s primary intent is to bring in legal transparency, which would help in facilitating and not hampering participation of wider pool of stakeholders. India envisions Nuclear power as an essential element of its energy mix and has plans to expand its nuclear capacity multifold in the near future. Consequently, the services of global suppliers would be much needed in India to cater to the emerging business requirements in the country.

Without deviating from the facts, we need to understand the Act with a positive perspective. To clear basic misconception we need to start with the following 3 basic questions using the details of the Act.

1. Who is a supplier as per the Act?

Examining the rule 24 of the Act, DAE has clearly stated that supplier is ‘Technology owner or System designer’. The supplier would assume the role of supplier on behalf of the vendors from whom it sources supplies/services. For Indian PHWR projects, NPCIL holds the role of supplier and it is clearly indicated in the General Terms of Contract (GCC).

2. What is the period of right to recourse against a supplier?

The operator’s right to recourse will be limited to initial licensed period or product liability period whichever is longer. Typically this is a period of 5-7 years and is a general contract practice in almost all countries.

3. Are there provisions to renders supplier harmless?

First of all operator’s right to recourse has to expressly mentioned in the contract and if it is there supplier’s policy from India Nuclear Insurance Pool (INIP) will render the supplier harmless.

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By |2022-04-13T16:07:01+08:00April 13th, 2022|industry-insights|0 Comments