Lemma 10.120.7 (Nagata's criterion for factoriality). Let A be a domain. Let S \subset A be a multiplicative subset generated by prime elements. Let x \in A be irreducible. Then
the image of x in S^{-1}A is irreducible or a unit, and
x is prime if and only if the image of x in S^{-1}A is a unit or a prime element in S^{-1}A.
Moreover, then A is a UFD if and only if every element of A has a factorization into irreducibles and S^{-1}A is a UFD.
Proof.
Say x = \alpha \beta for \alpha , \beta \in S^{-1}A. Then \alpha = a/s and \beta = b/s' for a, b \in A, s, s' \in S. Thus we get ss'x = ab. By assumption we can write ss' = p_1 \ldots p_ r for some prime elements p_ i. For each i the element p_ i divides either a or b. Dividing we find a factorization x = a' b' and a = s'' a', b = s''' b' for some s'', s''' \in S. As x is irreducible, either a' or b' is a unit. Tracing back we find that either \alpha or \beta is a unit. This proves (1).
Suppose x is prime. Then A/(x) is a domain. Hence S^{-1}A/xS^{-1}A = S^{-1}(A/(x)) is a domain or zero. Thus x maps to a prime element or a unit.
Suppose that the image of x in S^{-1}A is a unit. Then y x = s for some s \in S and y \in A. By assumption s = p_1 \ldots p_ r with p_ i a prime element. For each i either p_ i divides y or p_ i divides x. In the second case p_ i and x are associates (as x is irreducible) and we are done. But if the first case happens for all i = 1, \ldots , r, then x is a unit which is a contradiction.
Suppose that the image of x in S^{-1}A is a prime element. Assume a, b \in A and ab \in (x). Then sa = xy or sb = xy for some s \in S and y \in A. Say the first case happens. By assumption s = p_1 \ldots p_ r with p_ i a prime element. For each i either p_ i divides y or p_ i divides x. In the second case p_ i and x are associates (as x is irreducible) and we are done. If the first case happens for all i = 1, \ldots , r, then a \in (x) as desired. This completes the proof of (2).
The final statement of the lemma follows from (1) and (2) and Lemma 10.120.5.
\square
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