NCI president Paul Leventhal said there was no proof that Japan was diverting plutonium for a weapons program.
Washington suspects North Korea has diverted plutonium in past years, and says outside checks are essential to determine if the isolated communist regime has embarked on a nuclear weapons program.
The condition was its insistence that North Korea insure that monitors be allowed to take measurements to determine whether Pyongyang had ever diverted plutonium for a nuclear weapon.
North Korea is still balking at allowing inspections of two nuclear waste sites, visits that would help determine whether it had diverted plutonium to arms.
The Central Intelligence Agency believes that North Korea has already diverted enough plutonium for one or two crude bombs.
Inspection of the suspected dump site is critical to determining if North Korea has diverted plutonium from its reactor to use in nuclear weapons.
Creating further concern, North Korea's Foreign Ministry said it will never permit inspections of two waste sites believed to contain evidence that it diverted plutonium to build a bomb.
Washington also insisted that the North make it possible to determine in the future whether it had ever diverted plutonium, a fissionable byproduct of the Yongbyon generator.
Such inspections could answer the question whether North Korea has diverted enough plutonium to make one or more bombs.
However, it was believed that North Korea was diverting plutonium extracted from the fuel of its reactor at Yongbyon, for use in nuclear weapons.