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THE WHITE HOUSE
WASHINGTON
June 8, 1993
MEMORANDUM FOR WHITE HOUSE STAFF
FROM:
BERNARD W. NUSSBAUM
COUNSEL TO THE PRESIDENT
CHERYL MILLS
ASSOCIATE COUNSEL TO THE PRESIDENT
BETH NOLAN
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Reminder on Ethics Obligations and Gifts
The President is committed to ensuring that all employees adhere
to the highest standards of integrity. As a White House
employee, you are subject to the criminal conflict of interest
laws, the Standards of Ethical Conduct for Executive Branch
Employees, the Foreign Gifts Act, and a number of other
restrictions, some of them with significant penalties. You
should have received a copy of the Standards of Ethical Conduct
when you attended your orientation ethics briefing. Additional
copies of the Standards of Ethical Conduct are available in the
Counsel's Office, OEOB Room 128. If you have not attended an
Ethics briefing, please be sure that you attend the next
regularly scheduled briefing, on Tuesday, June 29, 1993 at
4:00 p.m. in Room 450, OEOB. It is critical that every White
House employee receive training in the ethical obligations that
apply to those serving in the government.
This memorandum lays out the White House policy regulating the
receipt of gifts, both domestic and foreign, under the Standards
of Ethical Conduct for Executive Branch Employees and the Foreign
Gift Act.
General Domestic Gift Principles
The principles discussed below apply to gifts offered to or
received by you personally. You should be aware that there are
only very limited circumstances in which a gift may be accepted
for official purposes, or otherwise on behalf of the White House.
No gift -- including, but not limited to, computer software or
hardware, or other equipment, whether by outright gift or loan --
1
should be accepted for official use without first checking with
the Counsel's Office. Normally, acceptance of such gifts will
not be permissible. Although it is often frustrating to deal
with outmoded or inadequate equipment, the solution is NOT for
White House staff individually to solicit or accept gifts or
loans of such equipment from private sources. Moreover, it also
is improper to solicit or accept such equipment personally and
then use it for official business. It is very important that you
understand and comply with this restriction on soliciting and
accepting gifts for official purposes.
Gifts that are offered to or received by you personally are also
subject to a number of limitations, which are set forth in the
Standards of Ethical Conduct. These limits are discussed below,
but you should refer to the Standards of Ethical Conduct
themselves if any questions arise about a gift.
Under the Standards of Ethical Conduct, executive branch
employees may not accept a gift in return for being influenced in
the performance of an official act nor may he or she solicit or
coerce the offering of any gift.
Moreover, White House employees may not solicit or accept a gift:
1. from a prohibited source; or
2. given because of the employee's official position.
I.
What Constitutes a "Gift"
Virtually anything of value constitutes a gift, whether it comes
in the form of an outright donation, loan, favor, discount,
travel, lodging, entertainment, or other hospitality. This
includes, for example, meals, flowers, tickets to events, or
loans of software or equipment. When in doubt, it is best to
assume that anything of value is a gift. As discussed below,
however, some exceptions permit you to accept certain gifts.
II. What Constitutes a "Prohibited Source"
A prohibited source includes anyone who:
1. is seeking official action by the White House;
2. does business or seeks to do business with the White House;
3. conducts activities regulated by the White House;
4. has interests that may be substantially affected by the
performance or nonperformance of your official duties; or
2
5. is an organization composed of members who can be described
by the criteria set forth immediately above.
Thus, under the Standards of Ethical Conduct, White House staff
members generally are prohibited from accepting gifts (including
meals, evaluative computer hardware and software, tickets to
events) from most sources -- including, among others,
contractors, the press, corporations, regulated business groups,
and litigating parties.
III. Gifts That May Be Accepted
The Standards of Ethical Conduct provide limited exceptions under
which certain gifts from prohibited sources or gifts given
because of a staff member's official position properly may be
accepted. These exceptions are very limited; gifts that fall
outside of the exceptions cannot be accepted consistent with the
Standards of Ethical Conduct.
In addition to the exceptions, you always may choose to pay the
regular price for an item -- the face value of a ticket, the
market price of a book, etc., -- if you wish to keep an item that
you are not permitted to accept as a gift. Moreover, under
certain circumstances, travel on official business may be paid
for by outside sources. However, you must seek approval for such
travel expenses prior to traveling.
In all instances, however, employees may not solicit or coerce
the offering of a gift -- even if the gift could be accepted
under one of the excepted categories in the Standards of Ethical
Conduct.
The following categories of gifts may be accepted consistent with
the Standards of Ethical Conduct:
A. Gifts of $20 or Less. You may accept an unsolicited
gift (other than cash or its equivalent) that is valued at $20 or
less per occasion. This category applies to all goods as well as
dinners and receptions. See Memorandum for White House Staff,
"Meals, Receptions, Dinners, and Events" (March 1, 1993).
Although, you may accept a meal, book, or other item valued at
$20 or less, you may not keep a gift valued over $20 by paying
the difference between the gift's market value and the $20
limitation. Moreover, you may not accept more than an aggregate
amount of $50 in gifts under this exception from any single
source in a calendar year.
Unsolicited advertising and promotional materials of nominal
value may be accepted even if they come from individuals or
businesses having business with your office or regulated by your
office or some other agency of the government. This extends only
to such customary items as desk calendars, pens, pocket diaries,
3
and the like. By way of example, this rule would not permit the
acceptance of a case of champagne, a work of art, evaluative
computer software or hardware equipment, or other items of
substantial value.
B. Gift Based on a Personal Relationship. You may accept
an unsolicited gift where it is clear that the gift is motivated
by a family relationship or close personal friendship rather than
your official position. In assessing whether a gift meets this
exception, the history of your relationship (does it predate your
government service?) and the source of payment (did the
individual or a company or business pay?) are important factors.
C. Gifts Based on Outside Business or Employment
Relationships. You may accept meals, lodging, transportation and
other benefits that results from the business or employment
relationships of a spouse, provided it is clear that the gift has
not been enhanced because of your official status. Thus, you may
attend the opera with your spouse (or significant other) even
when his or her employer provides him or her with tickets to
attend.
You also may accept such gifts that result from your own outside
business or employment activities provided it is clear that such
gifts also have not been offered or enhanced because of your
official position. Note, however, that all full-time White House
officials paid above $27,789 are prohibited from receiving income
from any outside employment activities. Moreover, outside
business activities, even if otherwise permissible, should be
cleared through Counsel's Office to ensure that no conflicts of
interest are created by the activity.
D. Employment-Related Speaking Engagements. When you are
speaking or presenting information on behalf of the White House
in your official capacity, you may accept meals and the offer of
free attendance at a conference, meeting or event on the day of
your speech or presentation when provided by the sponsor of the
event.
When travel expenses will be covered by a nongovernmental
organization, you must receive approval by completing and
submitting a non-federal source travel form to the Counsel's
Office. These forms are available in the Administrative Office
(OEOB, Room 1).
E. Widely Attended Gatherings. You may accept free
attendance and meals offered by the sponsor of a widely attended
gathering of mutual interest to a number of parties, provided
your department head has determined it is in the interest of the
White House that you attend. However, you may not attend an
4
event or dinner as the guest of an organization other than the
sponsor of the entire event; that is, the ticket must be offered
and paid for by the host of the event. You should consult
Counsel's Office to ensure that an event properly meets the
"widely attended gathering" exception.
F. Gifts from a Political Organization. Those White House
officials who are exempt from the Hatch Act (which includes staff
members paid from appropriated funds for the White House Office)
may accept meals, lodgings, transportation and other benefits,
including free attendance at events, when provided by a political
organization defined under 26 U.S.C. 527 (e) (e.g., the Democratic
National Committee or campaign committees for state, local and
federal candidates).
G. Social Invitations from Non-Prohibited Sources. You may
accept food and entertainment at a social event attended by
several persons when the host is not a prohibited source and no
fee is charged to anyone in attendance.
H. Awards and Honorary Degrees. You may accept a gift,
other than cash or an investment interest, with an aggregate
market value of $200 or less if it is a bona fide award or is
offered incident to a bona fide award that is given for
meritorious public service or achievement by a person (or
organization) who does not have interests that may be
substantially affected by the performance or nonperformance of
your official duties.
A few other exceptions also apply for certain discounts and for
meals and entertainment in foreign areas. You should consult the
Standards of Ethical Conduct for specific guidance.
Assuming that the gift you would like to accept does meet one of
the above exceptions, you always should consider whether your
acceptance of the gift nevertheless would lead a reasonable
person to question your impartiality in official matters
affecting the donor. Where such an appearance question could be
raised, you should decline to accept the gift.
General Foreign Gift Principles
I. Gifts From Foreign Governments
The United States Constitution and the Foreign Gifts Act, 5
U.S.C. 7342, generally prohibit U.S. Government officials, their
spouses and dependents from accepting foreign gifts or
decorations. The following general guidelines apply to gifts
from foreign governments and officials:
5
A. A U.S. official may not request or encourage an offer of a
gift or decoration.
B. Gifts from foreign governments valued at $200 or more
automatically become the property of the U.S. Government. Such
gifts may be accepted on behalf of the United States only when
"it appears that to refuse
would likely cause offense or
embarrassment or otherwise adversely affect the foreign relations
of the United States
" Because such gifts are "deemed to
have been accepted on behalf of the United States," however, they
must be turned over to the White House Gift Unit as soon as
possible for recording, necessary reporting and disposition.
C. Gifts from foreign governments valued under $200 (termed
gifts "of minimal value", which are "tendered and received as a
souvenir or mark of courtesy" may be accepted and retained. Such
gifts retained by you are subject to the annual public financial
disclosure, discussed below, under the same conditions as
domestic gifts.
D. Valuation of a gift is based on the retail value in the
United States at the time of acceptance. 41 C.F.R. $101.49.001-
5. A valuation of any gift should be sought immediately upon
receipt (or upon your return from a foreign country). The gift
should be submitted to the White House Gift Unit for valuation.
E. Under the General Services Administration's Interim Rule 4
(57 Fed. Reg. 53,283, November 9, 1992), federal employees may
accept gifts of travel, meals and lodging from foreign
governments and multinational organizations. Pursuant to 31
U.S.C. 1353 (travel by government officials paid for by non-
federal sources), acceptance of any such gifts must be consistent
with the conflict of interest rules outlined in Interim Rule 4.
Such travel also must be approved by Counsel's Office and a
thorough record of any such expenses accepted should be kept as
they may be required to be reported to the State Department and
on the annual financial disclosure form (discussed below).
F. In the case of travel taking place entirely outside of the
United States -- e.g., travel by a U.S. official between two
foriegn countries -- the Foreign Gifts Act specifically requires
that the value of travel or expenses paid by foreign governments
for transportation, food or lodging must be reasonable and
acceptance must be consistent with the interests of the United
States.
6
II. Gifts from Foreign Non-Official Individuals
The Foreign Gifts Act applies only to official gifts from foreign
governments and officials. We must caution you to be wary of
gifts offered to you from foreign non-official individuals,
especially when you do not know the donor. Any such gift is
treated the same as a domestic gift in regard to propriety of
acceptance, conflicts of interests, reporting, etc.
Reporting Requirements and the Gift Unit
I.
White House Gift Unit and Report Forms
Members of the White House Office should complete a White House
Staff Gift Report Form for all gifts, foreign and domestic.
These forms may be obtained in reasonable quantities from the
Supply Room or the White House Gift Unit, OEOB Room 457
(ext. 7133). The gift itself should be submitted to the Gift
Unit for appraisal, together with the completed form.
Staff who are required to file annual financial disclosure
reports should maintain a log of gifts valued in excess of $100.
Gifts in excess of $250 from a single source must be disclosed on
the annual SF-278 Public Financial Disclosure Report, aggregating
gifts of $100 or more from one source.
II. Disposal of Prohibited Gifts
If you receive a gift that may not be accepted consistent with
the Standards of Ethical Conduct, whether abroad, at the office,
or at home, you must return it to the donor with the explanation
that it cannot be accepted. A copy of the letter returning the
gift should be retained for your files, with a copy attached to
the White House Staff Gift Report Form that you send to the Gift
Unit.
When it is not practical to return a tangible item because it is
perishable, you may give the item to a charity, share it with
your office or have it destroyed by the Gift Unit. A staff
member still must report the gift (and the disposition) to the
Gift Unit. Perishable items include flowers and food items.
If for some reason you feel you cannot return the gift (donor
unknown, the address of donor unknown, embarrassment to the
donor, or other), you should so indicate on the Gift Report Form,
making sure to explain the rationale for not returning the item.
If after analysis, the Gift Unit confirms that returning the gift
is not possible or advisable, it will be turned over to GSA for
disposal.
7
III. Reporting Requirements
In the event that a gift is retained, those staff members
required to file financial disclosure reports on Form SF-278 are
reminded that they have an obligation to report any gift over
$250 in value received from persons other than relatives --
including any foreign gifts. In addition, foreign and domestic
gifts over $100 in value must be reported if the aggregate of
such gifts received from the same source in one year exceeds
$250.
We recommend that you log all gifts received with the Gift Unit
so that you can determine at reporting time whether there is a
reporting requirement. The Gift Unit will assist you by
determining the value of gifts. By routinely submitting the
White House Staff Gift Report Forms to the Gift Unit throughout
the year, you will enable the Gift Unit to supply you with an
accurate and complete list of reportable gifts at the end of the
year for inclusion on your SF-278 - the following year.
Gifts for the President, First Lady,
the Vice President and Mrs. Gore
Anyone who receives a gift intended for the President, the First
Lady, the Vice President or Mrs. Gore, must ensure that it is
turned over to security personnel for inspection as soon as
possible. Please be particularly wary of gifts which are
suddenly or unexpectedly thrust upon you. Upon return from
security, the gift should be deposited with the White House (or
Vice President) Gift Unit, along with information concerning the
identity of the donor, time and place of acceptance, etc., so
that the gift properly can be recorded and a decision made as to
its disposition.
No staff member should accept a foreign gift for the President,
the First Lady, the Vice President or Mrs. Gore except by prior
arrangement with the host government or entity.
Conclusion
Your observance of these rules is essential and appreciated.
This memorandum is necessarily summary and does not deal with all
questions that may arise. In all instances, the Standards of
Ethical Conduct for Executive Branch Employees should guide your
behavior. If you are in doubt about the propriety of accepting
any gift or about any other topic covered above, please consult
with the Counsel's Office, by calling 456-6229.
8
Nenggee
How to
Keep Out
of Trouble
Ethical Conduct
for Federal Employees
in Brief
Public Service Public Trust
OFFICE OF GOVERNMENT ETHICS
OGE 6
March 1986
FOREWORD
The Office of Government Ethics has Federal statutory responsibility to
promote understanding of ethical standards in executive agencies. The laws and
regulations that make up those government-wide standards are found in Title 18
of the United States Code, sections 202 through 209, and Executive Order 11222,
as implemented by Part 735 of Title 5 of the Code of Federal Regulations.
This pamphlet is an effort to explain the thrust and practical applications of
these ethical laws and regulations. It is not intended to be all-inclusive of the
various ethical restrictions placed on you, nor should it be used as a basis for
definitive interpretation of the criminal law provisions or the Executive Order.
Additionally, you may be subject to other agency-specific restrictions. The
question and answer format is designed to anticipate and answer some of the
more common concerns facing Federal employees. I hope it will be a useful
reference guide to you as you carry out your official responsibilities.
The pamphlet was prepared with the assistance of the President's Council on
Integrity and Efficiency. Special recognition is extended to the Inspector General
Offices of the Departments of Defense and Housing and Urban Development, and
the Assistant Secretary for Personnel of the Department of Health and Human
Services for providing representatives to compile the pamphlet. The Department
of Health and Human Services also provided materials used in its preparation.
DairdH martin
David H. Martin
Director
Office of Government Ethics
INTRODUCTION
As officers and employees of the Federal Government, we must all conform to
high standards of ethical conduct. We are judged not only by our official actions
and conduct, but also by our personal activities when they are related to our work
for the Government. The Government relies on us as its representatives to
perform Government business properly, to protect Government interests, and to
meet the high ethical standards of public service.
The purpose of this pamphlet is to present the basic laws and regulations on
ethical conduct in an easy-to-read, easy-to-understand format. This pamphlet
condenses the regulations into a concise document that you can use as a ready
reference for answering questions. The pamphlet does not replace existing laws
and regulations which should be consulted for the precise requirements.
For the most part, the standards of conduct and conflict of interest laws apply to
all Government officers and employees including special Government employees,
such as experts, consultants, and advisory committee members. You are
responsible for knowing these laws and regulations as well as the specific policies
and procedures of your own agency.
Employees, supervisors, and management officials all share the responsibility for
ensuring that high standards of ethical conduct are maintained within the
Government. You are required to become familiar with the standards of conduct
regulations and to exercise judgment to avoid any action that might result in or
create the appearance of misconduct or conflict of interest. Supervisors and
managers must become familiar with the standards of conduct regulations and
apply the standards to the work they do and supervise.
TABLE OF CONTENTS
Pages
INTRODUCTION
i
ETHICAL CONDUCT FOR ALL EMPLOYEES
Where Can You Get Guidance on the Ethics Laws and Regulations?
1
What Are the General Standards of Conduct?
1
Are You Allowed to Use Government Property for Personal
Reasons?
2
What Is the Government's Policy on the Acceptance of
Gifts, Entertainment, and Favors?
2
What about Using Information Picked Up on the Job?
5
What Happens if You Fail to Pay Your Debts?
5
Can You Gamble While on Duty?
6
Can You Have a Second Job Outside of the Government?
6
Can You Obtain Personal Gain From Your Official Position or
Actions?
7
What Are Post-Employment Restrictions?
9
Are Experts, Consultants and Advisory Committee Members
Covered by the Standards of Conduct Regulations and the Conflict
of Interest Laws?
10
What if You Want to Report a Violation of the Standards
of Conduct Regulations or the Conflict of Interest Laws?
10
Are You Required to Give Statements to Investigative
Officials?
11
What Action May Be Taken if You Violate the Standards of
Conduct Regulations or the Conflict of Interest Laws?
11
THE HATCH ACT
What are the Political Do's and Don'ts for Federal Employees?
12
APPENDIX
A. Reference Chart to Laws and Regulations
A-1
ETHICAL CONDUCT FOR ALL EMPLOYEES
WHERE CAN YOU GET GUIDANCE ON THE ETHICS LAWS AND REGULATIONS?
You are encouraged to seek guidance whenever you are unsure whether your
actions or planned actions are in accordance with the standards. There are several
sources within the Government that you can rely on for guidance on ethical
matters. Among them are:
- The Office of Government Ethics
- The Office of the General Counsel
- The Designated Agency Ethics Official
- The Personnel Office
- The Office of the Inspector General
WHAT ARE THE GENERAL STANDARDS OF CONDUCT?
An employee must avoid any action that might result in or create the appearance
of:
- Using public office for private gain;
- Giving preferential treatment to anyone;
- Impeding Government efficiency or economy;
- Losing complete independence or impartiality;
- Making a Government decision outside official channels; or
- Affecting adversely the confidence of the public in the integrity of the
Government.
Employees must be particularly careful that private interests and activities do not
impact adversely on or conflict with their public duties. The following sections
address specific questions that you may have.
ARE YOU ALLOWED TO USE GOVERNMENT PROPERTY FOR PERSONAL REASONS?
No. You have a positive duty to protect and conserve Federal property and to
obey all rules and regulations regarding its use. You cannot directly or indirectly
use or allow the use of Government property for other than officially approved
activities. This includes property leased to the Government. (5 C.F.R. 735.205)
A few examples of the improper use of Government property include:
- Using Government envelopes to send payroll checks to the bank or for
other personal matters.
- Using Government photocopy equipment for personal matters.
- Using a Government-owned, leased, or rented vehicle or aircraft for non-
official purposes.
- Using Government telephones to make personal telephone calls. (This includes
local and long distance calls over both commercial facilities and the Federal
Telecommunications System.)
- Selling commercial products in a Government building.
- Using Government computers and word processors for personal matters.
WHAT IS THE GOVERNMENT'S POLICY ON THE ACCEPTANCE OF GIFTS,
ENTERTAINMENT, AND FAVORS?
You may not solicit or accept anything of monetary value, including gifts,
gratuities, favors, entertainment or loans from any person who:
- Has or is seeking to obtain contractual or other business or financial relations
with your agency.
- Conducts operations or activities that are regulated by your agency; or
- Has interests that may be substantially affected by the performance or
nonperformance of your official duties. (5 C.F.R. 735.202)
Your agency may have additional restrictions or may provide exceptions for the
following:
- Gifts, gratuities, favors, entertainment, loans or similar favors of monetary
value that stem from a family or personal relationship when the
circumstances make it clear that it is that relationship rather than the business
of the person concerned that motivates the gift;
- Loans from banks or other financial institutions on customary terms;
- Unsolicited advertising or promotional material of nominal value such as pens,
note pads, and calendars;
- Food or refreshments of nominal value, served on infrequent occasions, in the
ordinary course of a luncheon or dinner meeting and only if you are
properly in attendance and there is not a reasonable opportunity to pay,
or if the food is offered to all participants attending the meeting or
convention.
- Travel and subsistence expenses in certain cases when authorized by your
agency.
Listed below are examples of instances when you may be offered gifts or favors
and the proper action to take in each case:
-
You are on the premises of Company X participating in a
meeting at lunchtime. A representative of Company X
provides a meal for all meeting participants from a
Company X facility and there is no established method
for payment. You may accept the meal, unless your
agency specifically prohibits it.
-
You are on the premises of Company X and you go to a
restaurant for lunch with a Company X salesperson. The
salesperson offers to pay the bill. Since it is expected
that employees pay for their own lunches, you may not
accept the salesperson's offer to buy lunch.
You should be aware that there are criminal provisions relating to the acceptance
of gifts, entertainment, and favors found in Title 18 of the United States Code.
One provision is Title 18 U.S.C. 209, which prohibits you from receiving any salary
as compensation for services as an employee of the Government from any source
other than the United States.
Example:
You are asked to give a speech in your official capacity.
You may not accept a fee for a speech given as part of
your Government duties.
This law does not prohibit you from continuing to participate in a bona fide
employee welfare or benefit plan maintained by a former employer. It also does
not prohibit you from receiving compensation from a state, county, or
municipality, unless prohibited under your agency's Standards of Conduct.
for about wedding best's
Gifts to superiors:
You may not solicit a contribution from another employee for a gift to an official
superior, or make a donation to a superior. Also, you may not accept a gift from
an employee receiving less pay than you. (5 U.S.C. 7351)
Most agencies allow voluntary gifts of nominal value or donations in a nominal
amount on a special occasion such as marriage, illness, or retirement.
Example:
Your office decides to take up a collection for your boss
who is being promoted within the office. This would not
qualify for the exception for special occasions because it
involves a continuing workplace relationship.
WHAT ABOUT USING.INFORMATION PICKED UP ON THE JOB?
You may not use, for furthering a private interest, information obtained through
your Government job that has not been made available to the general public.
(5 C.F.R. 735.206) For example, you would not be free to use information that has
not been dispersed by the agency or is available to a member of the public only by
special request.
WHAT HAPPENS IF YOU FAIL TO PAY YOUR DEBTS?
You should meet your just financial obligations in a proper and timely manner.
Failure to do so reflects adversely on the Government and on your agency and is
considered improper conduct. (5 C.F.R. 735.207)
CAN YOU GAMBLE WHILE ON DUTY?
No. You are not allowed to participate in any gambling activity while on
Government-owned or leased property or while on duty for the Government.
This includes the operation of a gambling device in conducting a lottery or pool,
in a game for money or property, or in selling or purchasing a numbers slip or
ticket. (5 C.F.R. 735.208)
CAN YOU HAVE A SECOND JOB OUTSIDE OF THE GOVERNMENT?
You may engage in outside employment, with or without compensation, but only
if it will not affect adversely the performance of your official duties and will not
conflict with your duties. Such work may include civic, charitable, religious, and
community undertakings. You may not participate in outside employment
which:
- Tends to impair your mental or physical capacity to perform Government duties
and responsibilities in an acceptable manner;
- Is likely to result in criticism or cause embarrassment to your agency;
- Creates a real or apparent conflict of interest;
- Takes your time and attention during your official work hours. (5 C.F.R.
735.203)
If you are considering outside employment, you may be required to obtain
advance administrative approval for certain activities as required by your agency.
There are other types of outside activity that you may be interested in pursuing
such as teaching, lecturing, and writing. Advance approval may be required by
your agency. A few of the most important restrictions on outside activities are as
follows:
- You may not use Government-financed time or supplies;
- You may not use or allow the use of official information that has not been
made available to the general public;
- You may not promote the use of your official title or affiliation with your
agency, and allow no suggestion of official endorsement.
Title 18 U.S.C. 203 and 205 prohibit you from representing another person before
an agency or court of the Federal or D.C. Governments, and from receiving
payment for someone else's representation before an agency of the Federal or
D.C. Governments. Your representation is prohibited even when uncompensated.
For example:
-
Unless specifically prohibited by your agency, you may
prepare income tax returns for others in your free time,
but you may not argue before the Internal Revenue
Service on behalf of your client, if there is a dispute over
the return.
-
You may not represent a non-profit organization of
which you are a member before a Federal agency in a
request for a grant even though you would not be paid
for the representation.
Exceptions:
Generally, you are allowed to represent your parents, your spouse or child, or
anyone for whom you serve as a guardian.
You also may provide testimony under oath.
CAN YOU OBTAIN PERSONAL GAIN FROM YOUR OFFICIAL POSITION OR
ACTIONS?
Generally speaking, you cannot participate personally and substantially as a
Government employee in a matter in which you have a financial interest. There is
no minimum amount of value or control that constitutes a financial interest. This
prohibition also applies if any of the following individuals or organizations have a
financial interest in the matter:
- Your spouse;
- Your minor child;
- Your partner;
- An organization in which you serve as an officer, director, trustee, partner or
employee; or
- A person or organization with which you are negotiating for prospective
employment or have an arrangement for prospective employment.
(18 U.S.C. 208)
The standards of conduct regulations go further in prohibiting you from having a
financial interest that conflicts or even appears to conflict with your Government
duties and responsibilities. (5 C.F.R. 735.204)
The following cases are examples of conflict of interest situations:
-
You own a single share of stock in a widely-held
corporation. If the corporation is likely to be affected by
a matter in which you will participate as a Government
official, you may violate 18 U.S.C. 208.
-
You have a paid part-time position with a non-Federal
organization. If the organization is likely to be affected
by a matter in which you will participate as a
Government official, you would violate 18 U.S.C. 208.
You are administering a Government contract with a
firm owned by your brother-in-law. You probably would
not violate 18 U.S.C. 208 because your brother-in-law's
financial interests are not considered to be yours, but
you would have the appearance of a conflict, which
would violate the standards of conduct.
You are conducting an audit of a private organization in
the course of your Government job. The head of this
private organization asks you to meet with her to discuss
leaving Government to join her organization. Unless you
immediately reject the offer, you would have to
disqualify yourself from further participation in the audit
in order not to violate 18 U.S.C. 208.
The head of your agency can grant you a waiver under 18 U.S.C. 208 if your
financial interest is found to be not so substantial as to affect the integrity of your
services. A general waiver can also be granted to a group of employees for
certain interests found to be too remote or inconsequential to affect the integrity
of the employees' services. The general waivers must be published in the Federal
Register.
WHAT ARE POST-EMPLOYMENT RESTRICTIONS?
Post-employment restrictions can be found in Title 18 of the United States Code.
Title 18 U.S.C. 207 prohibits former Government employees from "switching
sides." For example, as a former employee you would be prohibited permanently
from acting as another person's representative to the Government in certain
matters in which you have been involved substantially while in Federal service.
Also, for two years you would be prohibited from representing another person to
the Government in certain matters which were pending under your official
responsibility during your last year of Government service.
Examples:
As a former Government employee, you would be
prohibited from representing another person on a
contract you administered while with the Government,
but you could work on the contract in the contractor's
office.
As a former supervisor with the Government, you would
be prohibited for two years from representing another
person before the Government on a case that was under
your official responsibility during your last year of
Government service even if you did not actually work on
the case yourself.
There are additional restrictions, one of which imposes a one-year, agency
specific cooling-off period, that apply to certain senior employees whose
positions are listed in the Federal Register each year.
If you are planning to leave the Government, you should see your personnel
office or your Designated Agency Ethics Official for more information about this
law.
PERSONNEL
OFFICE
ARE EXPERTS, CONSULTANTS, AND ADVISORY COMMITTEE MEMBERS COVERED
BY THE STANDARDS OF CONDUCT REGULATIONS AND THE CONFLICT OF
INTEREST LAWS?
Yes. The standards of conduct regulations generally apply to those individuals,
known as special Government employees who do not serve for more than 130
days in a year. If you are a special Government employee, you should read
sections 203, 205, 207, and 208 of Title 18, United States Code, all of which carry
criminal penalties related to conflicts of interest, and the standards of conduct
regulations, where applicable.
WHAT IF YOU WANT TO REPORT A VIOLATION OF THE STANDARDS OF CONDUCT
REGULATIONS OR THE CONFLICT OF INTEREST LAWS?
If you know of criminal violations or violations of the standards of conduct
regulations committed by other employees of your agency or any outsider, or if
you know of any misconduct or abuses of authority, you are responsible for
reporting the violations to your supervisor, the Office of the Inspector General
(where applicable), your Designated Agency Ethics Official, or your personnel
office. Note, failure to report a criminal violation promptly could result in
disciplinary action being taken against the employee having such knowledge. If
you want to report violations to the Office of the Inspector General, use the IG
"hotline," where one exists.
ARE YOU REQUIRED TO GIVE STATEMENTS TO INVESTIGATIVE OFFICIALS?
You are required to assist the Inspector General and other investigative officials.
This requirement includes the giving of statements or evidence to investigators,
auditors, or inspectors of the Inspector General's Office or to other investigators
authorized to conduct investigations into potential violations. (NOTE: You
always retain your constitutional rights, including the rights to counsel and
against self-incrimination.)
WHAT ACTION MAY BE TAKEN IF YOU VIOLATE THE STANDARDS OF CONDUCT
REGULATIONS OR THE CONFLICT OF INTEREST LAWS?
You may be subject to disciplinary action if you violate any of the standards of
conduct regulations. This includes supplemental standards published by your
agency. The type of action to be taken must be determined in relation to the
specific violation. Some types of disciplinary action that may be considered are:
admonishment, written reprimand, reassignment, suspension, demotion and
removal. When such actions are taken, applicable laws, regulations, and proce-
dures must be followed. In addition, violations of Federal criminal statutes may
subject the violator to criminal prosecution. If you have questions concerning
disciplinary action, discuss your concerns with your supervisor or your personnel
office.
What Are The
Political Do's & Don'ts For Federal Employees?
Covered Employees
With very few exceptions, all employees in the executive branch of the
Federal Government are subject to the political activity provisions of the Hatch
Act. Employees of the U.S. Postal Service and the District of Columbia
government are also subject to this law.
May register and vote as they
May not be candidates for public
choose
office in partisan elections
May assist in voter registration
May not campaign for or against
drives
a candidate or slate of candidates
in partisan elections
May express opinions about
candidates and issues
May not make campaign
speeches or engage in other
May participate in campaigns
campaign activities to elect
where none of the candidates
partisan candidates
represent a political party
May not collect contributions or
May contribute money to
sell tickets to political fund-
political organizations or attend
raising functions
political fund-raising functions
May not distribute campaign
May wear or display political
material in partisan elections
badges, buttons, or stickers
May not organize or manage
May attend political rallies and
political rallies or meetings
meetings
May not hold office in political
May join political clubs or parties
clubs or parties
May sign nominating petitions
May not circulate nominating
petitions
May campaign for or against
referendum questions,
May not work to register voters
constitutional amendments, and
for one party only
municipal ordinances
An election is partisan if any candidate for an elected public office is running as
a representative of a political party whose presidential candidate received
electoral votes in the last presidential election.
Provided Courtesy of the Office of the Special Counsel, U.S. Merit Systems
Protection Board.
APPENDIX
Reference Chart to Laws and Regulations
Page
Citation to Law or
Title in Handbook
Number
Regulation
What are the General Standards
1
5 C.F.R. 735.201a
of Conduct
Are You Allowed to
2
5 C.F.R. 735.205
Use Government Property
for Personal Reasons?
What is the Government's
2
5 C.F.R. 735.202 &
Policy on the Acceptance
18 U.S.C. 201 & 209
of Gifts, Entertainment,
and Favors?
What about Using Information
5
5 C.F.R. 735.206
Picked up on the Job?
What Happens if You Fail to
5
5 C.F.R. 735.207
Pay Your Debts?
Can You Gamble while on Duty?
6
5 C.F.R. 735.208
Can You Have a Second Job
6
5 C.F.R. 735.203, 205,
Outside Government?
.206, & 201a(a); &
18 U.S.C. 203 & 205
Can You Obtain Personal Gain
7
5 C.F.R. 735.204 &
from Your Official Position
18 U.S.C. 208
or Actions?
What are Post-Employment
9
18 U.S.C. 207
Restrictions?
Are Experts, Consultants, and
10
5 C.F.R. 735 Subpart C,
Advisory Committee Members
18 U.S.C. 203, 205, 207,
Covered by the Standards of
& 208
Conduct and the Conflict of
Interest Laws?
THE WHITE HOUSE
WASHINGTON
July 26, 1993
MEMORANDUM FOR ALL NEW APPOINTEES AND EMPLOYEES
FROM:
BETH NOLAN; 30/mes
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
MANDATORY ETHICS ORIENTATION RESCHEDULED
The mandatory ethics training session for new White House
appointees and employees previously scheduled for Tuesday,
July 27, at 4:00 p.m. in OEOB, Room 450 has been rescheduled to:
TUESDAY, August 3 at 4:00 p.m., in OEOB Room 450
This session is for all new appointees and employees hired on or
after January 20, 1993 who have not attended one of our previous
orientations.
Please build time into your schedule to attend this session.
If you have any questions about the Standards of Ethical Conduct,
please call me at 456-6229.
THE WHITE HOUSE
WASHINGTON
SUMMARY
STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES
OF THE EXECUTIVE BRANCH
5 CFR PART 2635
GENERAL PROVISIONS - SUBPART A
Subpart A establishes the framework for the rest of the
regulation. It includes definitions, provides authority for
supplementation of the regulation when necessary by individual
agencies and encourages employees to seek advice from agency
ethics officials. It also:
Restates the 14 principles of ethical conduct and
instructs employees to apply them when considering
situations not specifically addressed by the
regulation; and
For situations that involve appearances of conflicts,
provides that the circumstances will be judged from the
perspective of a reasonable person with knowledge of
the relevant facts.
GIFTS FROM OUTSIDE SOURCES-SUBPART B
Subpart B prohibits employees from soliciting or accepting
gifts from prohibited sources or gifts given because of their
official position. The term "prohibited source" includes
anyone seeking business with or official action by an
employee's agency and anyone substantially affected by the
performance of an employee's official duties. For example, a
company bidding for an agency contract or a person seeking an
agency grant would be a prohibited source of gifts to employees
of that agency.
The term "gift" is defined to include nearly anything of
monetary value. However, it does not include items that
clearly are not gifts, such as publicly available discounts and
commercial loans and it does not include certain
inconsequential items, such as coffee, donuts, greeting cards
and certificates.
Additional information or a copy of the standards may be obtained
from your supervisor. Inquiries about the content of the
standards should be directed to the Office of Counsel to the
President staff at # (202) 456-6229.
-2-
There are several exceptions to the prohibitions against gifts
from outside sources. For example, with some limitations,
employees may accept:
Unsolicited gifts with a market value of $20 or less
per occasion, aggregating no more than $50 in a
calendar year from any single source;
Gifts motivated by a family relationship or personal
friendship;
Free attendance at certain widely-attended gatherings,
such as conferences and receptions, when the cost of
attendance is borne by the sponsor of the event; and
Food, refreshments and entertainment at certain
meetings or events while on duty in a foreign country.
The subpart also contains guidance on returning or paying for
gifts that cannot be accepted.
GIFTS BETWEEN EMPLOYEES-SUBPART c
Subpart C prohibits employees from:
Giving or soliciting a gift for another employee who is
an official superior; or
Accepting a gift from a lower-paid employee, unless the
two employees are personal friends who are not in a
superior-subordinate relationship.
The following are among the exceptions to these prohibitions:
On an occasional basis, employees may give and accept
items aggregating $10 or less per occasion, food and
refreshments shared in the office, or personal
hospitality at a residence. This exception can be used
for birthdays and those holidays when gifts are
traditionally exchanged.
On infrequent occasions of personal significance, such
as marriage, and on occasions that terminate the
superior-subordinate relationship, such as retirement,
employees may give and accept gifts appropriate to the
occasion and they may make or solicit voluntary
contributions of nominal amounts for group gifts.
See attached memorandum of March 1, 1993 from Bernard Nussbaum
to White House staff.
-3-
CONFLICTING FINANCIAL INTERESTS-SUBPART D
Subpart D contains two provisions designed to deal with financial
interests that conflict with employees' official duties.
The first provision entitled "Disqualifying financial interests"
prohibits an employee from participating in an official
government capacity in a matter in which he or she has a
financial interest or in which his or her spouse, minor child,
employer or any one of several other specified persons has a
financial interest. For example, an agency purchasing agent
could not place an agency order for computer software with a
company owned by his or her spouse. The provision includes
alternatives to nonparticipation, which may involve selling or
giving up the conflicting interest or obtaining a statutory
waiver that will permit the employee to continue to perform
specific official duties.
The second provision, entitled "Prohibited financial interests,"
contains authority by which agencies may prohibit employees from
acquiring or retaining certain financial interests.
Employees required by Subchapter D to sell financial interests
may be eligible to defer the tax consequences of that
divestiture.
IMPARTIALITY IN PERFORMING OFFICIAL DUTIES-SUBPART E
There may be circumstances other than those covered by Subpart D
in which employees should not perform official duties in order to
avoid an appearance of loss of impartiality. Subpart E contains
two disqualification provisions addressing those appearance
issues.
The first provision, entitled "Personal and business
relationships," states that employees should obtain specific
authorization before participating in certain government matters
where their impartiality is likely to be questioned. The matters
specifically covered by this standard include those:
Involving specific matters, such as contracts, grants
or investigations, that are likely to affect the
financial interests of members of employees'
households; or
In which persons with whom employees have specific
relationship are parties or represent parties. This
would include, for example, matters involving employers
of spouses or minor children, or anyone with whom
employees have or seek a business or financial
relationship.
-4-
There are procedures by which employees may be authorized to
participate in such matters when it serves the employing agency's
interests. The process set forth in Subpart E should be used to
address any matter in which an employee's impartiality is likely
to be questioned.
The second provision, entitled "Extraordinary payments from
former employers," restricts employees' participation in certain
matters involving former employers. If a former employer gave an
employee an "extraordinary payment" in excess of $10,000 prior to
entering Federal service, it bars the employee from participating
for two years in matters in which that former employer is or
represents a party. A $25,000 payment voted on an ad hoc basis
by a board of directors would be an "extraordinary payment.' A
routine severance payment made under an established employee
benefit plan would not.
SEEKING OTHER EMPLOYMENT-SUBPART F
Subpart F prohibits employees from participating in their
official capacities in particular matters that have a direct and
predictable effect on the financial interests of persons with
whom they are "seeking employment" or with whom they have an
arrangement concerning future employment.
The term "seeking employment" encompasses actual employment
negotiations as well as more preliminary efforts to obtain
employment, such as sending an unsolicited resume. It does not
include:
Sending an unsolicited resume, for example, to someone
only affected by the employee's work on general
rulemaking; or
Requesting a job application or rejecting an
unsolicited employment overture.
An employee generally continues to be "seeking employment" until
he or she or the prospective employer rejects the possibility of
employment and all discussions end. However, an employee is no
longer "seeking employment" with the recipient of an unsolicited
resume after two months have passed with no response.
MISUSE OF POSITION-SUBPART G
Subpart G contains four provisions designed to ensure that
employees do not misuse their official positions. These include:
A prohibition against employees using public office for
their own private gain or for the private gain of
friends, relatives or persons with whom they are
-5-
affiliated in a nongovernment capacity, or for the
endorsement of any product, service or enterprise.
A prohibition against engaging in financial
transactions using nonpublic information, or allowing
the improper use of nonpublic information to further
private interests;
An affirmative duty to protect and conserve Government
property and to use Government property only for
authorized purposes; and
A prohibition against using official time other than in
an honest effort to perform official duties and a
prohibition against encouraging or requesting a
subordinate to use official time to perform
unauthorized activities.
OUTSIDE ACTIVITIES-SUBPART H
Subpart H contains provisions governing employees' involvement in
outside activities, including outside employment. These
provisions are in addition to the provisions set forth in other
subparts of the regulation. The provisions in Subpart H include:
Synopses of statutes and a constitutional provision
that may limit certain outside activities;
A prohibition against engaging in outside activities
that conflict with employees' official duties;
Authority by which individual agencies may require
employees to obtain approval before engaging in outside
activities;
Limitations on outside earned income applicable to
certain Presidential appointees and certain noncareer
employees;
A prohibition against serving as an expert witness,
other than on behalf of the United States, in certain
proceedings in which the United States is a party or
has a direct and substantial interest;
A prohibition against receiving compensation for
teaching, speaking or writing related to their official
duties, which is in addition to the honorarium
prohibition imposed by statute;
Limitations on fundraising in a personal capacity; and
-6-
A requirement that employees satisfy their just
financial obligations.
Subpart H reserves the section which, in the proposed rule, had
set forth standards for participation in the activities of
professional associations.
RELATED STATUTORY AUTHORITIES-SUBPART I
Subpart I provides references to other statutes which relate to
employee conduct.
THE WHITE HOUSE
WASHINGTON
March 1, 1993
MEMORANDUM FOR WHITE HOUSE OFFICE STAFF
FROM:
BERNARD NUSSBAUM
COUNSEL TO THE PRESIDENT
CHERYL MILLS C
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Meals, Receptions, Dinners, and Events
This memorandum provides general guidance on the propriety of
accepting meals and invitations to receptions, dinners and other
events from outside domestic sources. The rules governing the
Standards of Conduct for Executive Branch Employees are contained
in 5 C.F.R. Part 2635, which were issued by the Office of
Government Ethics ("OGE"). These rules are provided at every
ethics briefing for White House Office employees. Additional
copies of the rules are available from Counsel's Office (OEOB,
Room 128).
Under the ethics rules, White House employees may not accept a
gift in return for being influenced in the performance of an
official act nor may he or she solicit or coerce the offering of
a gift. Moreover, White House employees may not solicit or
accept a gift:
1. from a prohibited source; or
2. given because of the employee's official position.
A gift includes "any gratuity, favor, discount, entertainment,
hospitality, loan, forbearance, or other item having monetary
value. It includes services as well as gifts of training,
transportation, local travel, lodgings and meals." 5 C.F.R.
S 2635.203.
A prohibited source includes anyone who:
1. is seeking official action by the White House Office;
2. does business or seeks to do business with the White House
Office;
3. conducts activities regulated by the White House Office;
4. has interests that may be substantially affected by the
performance or nonperformance of your official duties; or
5. is an organization composed of members who can be described
by the criteria set forth immediately above.
Under this policy, we generally are prohibited from accepting
meals (dinners, tickets to events) from virtually all sources --
including, among others, contractors, regulated business groups,
and litigating parties.
with regard to the press, a 1987 OGE opinion determined that
reporters seeking information from, or an interview or ongoing
working relationship with, a government employee because of the
employee's official position are prohibited sources for the
official. Thus, members of the press are prohibited sources. As
a general rule, the 1987 OGE opinion stated that any individual
or organization that offers free food or refreshments to a
government employee simply because of the employee's official
position is considered a prohibited source.
Exceptions
There are exceptions under which gifts of meals or entertainment
--invitations to events, dinners, receptions and parties -- may
be accepted from a prohibited source, provided that doing so does
not otherwise create an appearance of impropriety. These
exceptions are summarized below:
a) Gifts of $20 or Less. You may accept an unsolicited
gift (other than cash or its equivalent) valued at $20 or less
per occasion. Typically, a two-hour Washington reception for
which no attendance fee is charged will meet this exception.
Although, you may accept a meal, book, or other item valued at
$20 or less, you may not go to dinner and pay for the amount by
which the dinner exceeds the $20 limitation. You also may not
keep any other type of gift valued over $20 by paying the
difference between the gift's market value and the $20
limitation. Moreover, you may not accept more than an aggregate
amount of $50 in gifts under this exception from any single
person in a calendar year.
b) Gift Based on a Personal Relationship. You may accept
an unsolicited gift from a prohibited source where it is clear
that the gift is motivated by a family relationship or close
personal friendship rather than your official position. In
assessing whether a gift meets this exception, the history of
your relationship (does it predate your government service?) and
the source of payment are important factors.
2
c) Gifts Based on Outside Business or Employment
Relationships. You may accept meals, lodging, transportation and
other benefits from a prohibited source that results from the
business or employment relationships of a spouse, provided it is
clear that the gift has not been enhanced because of your
official status. Thus, you can attend the opera with your spouse
(or significant other) where his or her employer provides him or
her with tickets to attend. You also may accept such gifts that
result from your own outside business or employment activities
provided it is clear that such gifts also have not been offered
or enhanced because of your official position. Note, however,
that all full-time White House officials paid above $27,789 are
prohibited from receiving income from any outside employment
activities.
d) Employment-Related Speaking Engagements. When you are
speaking or presenting information on behalf of the White House
Office in your official capacity, you may accept meals and the
offer of free attendance at a conference, meeting or event on the
day of your speech or presentation when provided by the sponsor
of the event.
e) Widely-Attended-Gatherings. You may accept free
attendance and meals offered by the sponsor of a widely-
attended-gathering of mutual interest to a number of parties,
provided Counsel's Office has determined it is in the interest of
the White House Office that you attend. Therefore, where the
sponsor of a dinner (e.g., the Gridiron Association) offers you
free attendance, you can attend if Counsel Office's determines it
is in the White House's interest that you attend. You cannot
attend this dinner as the guest of another organization that has
paid for your ticket.
f) Gifts from a Political Organization. Those White House
officials who are exempt from the Hatch Act may accept meals,
lodgings, transportation and other benefits, including free
attendance at events, when provided by a political organization
pursuant to 26 U.S.C. S 527(e) (e.g., the Democratic National
Committee, campaign committees for state, local and federal
candidates).
g) Social Invitations from Non-Prohibited Sources. You can
accept food and entertainment at a social event attended by
several persons where the person is not a prohibited source and
no fee is charged to any in attendance.
Assuming that the event, dinner or reception you would like to
attend does meet one of the above exceptions, you always should
consider whether your attendance at the event nevertheless would
lead a reasonable person to question your impartiality in
official matters affecting the host, attendees, etc. Where such
3
an appearance question could be raised, you should consider
foregoing the event.
Finally, please remember that if you are required to file a
public financial disclosure form, all gifts (including meals that
are not received as personal hospitality) valued over $250 from
any one source (aggregating gifts over $100) must be reported
annually on your public disclosure form.
To summarize, except in limited circumstances, it generally is
prudent for White House Office staff to avoid accepting a free
meal or refreshments from any donor with government business. If
the meal, event, dinner or reception proffered by a prohibited
source does not meet any of the above exceptions, you may not
attend the event consistent with the Standards of Ethical
Conduct. You should perform your own analysis of an event you
wish to attend prior to contacting Counsel's Office to seek
advice. If, after careful evaluation in light of this
memorandum, you have difficulty judging a particular situation,
please contact Counsel's Office.
4
STANDARDS OF ETHICAL CONDUCT
FOR EMPLOYEES OF THE
EXECUTIVE BRANCH
Including:
Part I of Executive Order 12674
and
5 C.F.R. Part 2635 Regulation
LINITED STATES OFFICE OF
GUVERNMENT Errirs
Prepared by:
United States Office of Government Ethics
Suite 500, 1201 New York Avenue, NW.
Washington, DC 20005-3917
August 1992
STANDARDS OF ETHICAL CONDUCT
FOR EMPLOYEES OF THE EXECUTIVE BRANCH
Final Regulation Issued by
the U.S. Office of Government Ethics
To be Codified at 5 C.F.R. Part 2635
The following document is an informal computer-generated version of the regulatory
text of the final ethical conduct standards rule, the official version of which was
published at 57 Federal Register 35006-35067 (August 7, 1992), with an effective date
of February 3, 1993. The authority citation for this regulation is: 5 United States
Code §§ 7351 & 7353; 5 United States Code Appendix (Ethics in Government Act of
1978); and Executive Order 12674, 54 Federal Register 15159-15162, 3 Code of
Federal Regulations, 1989 Compilation, pp. 215-218, as modified by Executive Order
12731, 55 Federal Register 42547-42550, 3 Code of Federal Regulations, 1990
Compilation, pp. 306-311.
PRINCIPLES OF ETHICAL CONDUCT
FOR
GOVERNMENT OFFICERS AND EMPLOYEES
Executive Order 12674 of April 12, 1989
(as modified by E.O. 12731)
By virtue of the authority vested in me as President by the Constitution and
the laws of the United States of America, and in order to establish fair and
exacting standards of ethical conduct for all executive branch employees, it
is hereby ordered as follows:
Part I-Principles of Ethical Conduct
Section 101. Principles of Ethical Conduct. To ensure that every citizen can have
complete confidence in the integrity of the Federal Government, each Federal
employee shall respect and adhere to the fundamental principles of ethical service as
implemented in regulations promulgated under sections 201 and 301 of this order:
(a) Public service is a public trust, requiring employees to place loyalty to the
Constitution, the laws, and ethical principles above private gain.
(b) Employees shall not hold financial interests that conflict with the conscientious
performance of duty.
(c) Employees shall not engage in financial transactions using nonpublic Government
information or allow the improper use of such information to further any private
interest.
(d) An employee shall not, except pursuant to such reasonable exceptions as are
provided by regulation, solicit or accept any gift or other item of monetary value from
any person or entity seeking official action from, doing business with, or conducting
activities regulated by the employee's agency, or whose interests may be substantially
affected by the performance or nonperformance of the employee's duties.
(e) Employees shall put forth honest effort in the performance of their duties.
-1-
(f) Employees shall make no unauthorized commitments or promises of any kind
purporting to bind the Government.
(g) Employees shall not use public office for private gain.
(h) Employees shall act impartially and not give preferential treatment to any private
organization or individual.
(i) Employees shall protect and conserve Federal property and shall not use it for
other than authorized activities.
(j) Employees shall not engage in outside employment or activities, including seeking
or negotiating for employment, that conflict with official Government duties and
responsibilities.
(k) Employees shall disclose waste, fraud, abuse, and corruption to appropriate
authorities.
(1) Employees shall satisfy in good faith their obligations as citizens, including all just
financial obligations, especially those--such as Federal, State, or local taxes--that are
imposed by law.
(m) Employees shall adhere to all laws and regulations that provide equal
opportunity for all Americans regardless of race, color, religion, sex, national origin,
age, or handicap.
(n) Employees shall endeavor to avoid any actions creating the appearance that they
are violating the law or the ethical standards promulgated pursuant to this order.
Sec. 102. Limitations on Outside Earned Income.
(a) No employee who is appointed by the President to a full-time noncareer position
in the executive branch (including full-time noncareer employees in the White House
Office, the Office of Policy Development, and the Office of Cabinet Affairs), shall
receive any earned income for any outside employment or activity performed during
that Presidential appointment.
(b) The prohibition set forth in subsection (a) shall not apply to any full-time
noncareer employees employed pursuant to 3 U.S.C. 105 and 3 U.S.C. 107(a) at
salaries below the minimum rate of basic pay then paid for GS-9 of the General
Schedule. Any outside employment must comply with relevant agency standards of
conduct, including any requirements for approval of outside employment.
-2-
Table of Contents
Subpart A -- General Provisions
Page
§ 2635.101 Basic obligation of public service
3
§ 2635.102 Definitions
4
§ 2635.103 Applicability to members of the uniformed services
6
§
2635.104 Applicability to employees on detail
6
§
2635.105 Supplemental agency regulations
7
§
2635.106 Disciplinary and corrective action
8
§
2635.107 Ethics advice
9
Subpart B -- Gifts From Outside Sources
§ 2635.201 Overview
10
§ 2635.202 General standards
10
§ 2635.203 Definitions
11
§ 2635.204 Exceptions
14
§ 2635.205 Proper disposition of prohibited gifts
24
Subpart C -- Gifts Between Employees
§ 2635.301 Overview
25
§ 2635.302 General standards
26
§ 2635.303 Definitions
26
§ 2635.304 Exceptions
27
Subpart D -- Conflicting Financial Interests
§ 2635.401 Overview
30
§ 2635.402 Disqualifying financial interests
30
§ 2635.403 Prohibited financial interests
36
Subpart E -- Impartiality in Performing Official Duties
§ 2635.501 Overview
39
§ 2635.502 Personal and business relationships
40
§ 2635.503 Extraordinary payments from former employers
45
(Continued on next page)
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Table of Contents (Continued)
Subpart F -- Seeking Other Employment
Page
§ 2635.601 Overview
47
§ 2635.602 Applicability and related considerations
47
§ 2635.603 Definitions
48
§ 2635.604 Disqualification while seeking employment
51
§
2635.605 Waiver or authorization permitting participation
while seeking employment
53
§ 2635.606 Disqualification based on an arrangement concerning
prospective employment or otherwise after negotiations
54
Subpart G -- Misuse of Position
§ 2635.701 Overview
55
§ 2635.702 Use of public office for private gain
55
§ 2635.703 Use of nonpublic information
58
§ 2635.704 Use of Government property
59
§ 2635.705 Use of official time
60
Subpart H Outside Activities
§ 2635.801 Overview
61
§ 2635.802 Conflicting outside employment and activities
63
§ 2635.803 Prior approval for outside employment and activities
64
§ 2635.804 Outside earned income limitations applicable to certain
Presidential appointees and other noncareer employees
64
§
2635.805
Service as an expert witness
66
§
2635.806 Participation in professional associations [Reserved]
67
§ 2635.807 Teaching, speaking and writing
67
§ 2635.808 Fundraising activities
74
§ 2635.809 Just financial obligations
77
Subpart I -- Related Statutory Authorities
§ 2635.901 General
78
§ 2635.902 Related statutes
78
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Subpart A ⑉ General Provisions
$2635.101
Basic obligation of public service.
(a) Public service is a public trust. Each employee has a responsibility to the United
States Government and its citizens to place loyalty to the Constitution, laws and
ethical principles above private gain. To ensure that every citizen can have complete
confidence in the integrity of the Federal Government, each employee shall respect
and adhere to the principles of ethical conduct set forth in this section, as well as the
implementing standards contained in this part and in supplemental agency
regulations.
(b) General principles. The following general principles apply to every employee and
may form the basis for the standards contained in this part. Where a situation is not
covered by the standards set forth in this part, employees shall apply the principles
set forth in this section in determining whether their conduct is proper.
(1) Public service is a public trust, requiring employees to place loyalty to the
Constitution, the laws and ethical principles above private gain.
(2) Employees shall not hold financial interests that conflict with the conscientious
performance of duty.
(3) Employees shall not engage in financial transactions using nonpublic Government
information or allow the improper use of such information to further any private
interest.
(4) An employee shall not, except as permitted by subpart B of this part, solicit or
accept any gift or other item of monetary value from any person or entity seeking
official action from, doing business with, or conducting activities regulated by the
employee's agency, or whose interests may be substantially affected by the
performance or nonperformance of the employee's duties.
(5) Employees shall put forth honest effort in the performance of their duties.
(6) Employees shall not knowingly make unauthorized commitments or promises of
any kind purporting to bind the Government.
(7) Employees shall not use public office for private gain.
(8) Employees shall act impartially and not give preferential treatment to any private
organization or individual.
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(9) Employees shall protect and conserve Federal property and shall not use it for
other than authorized activities.
(10) Employees shall not engage in outside employment or activities, including
seeking or negotiating for employment, that conflict with official Government duties
and responsibilities.
(11) Employees shall disclose waste, fraud, abuse, and corruption to appropriate
authorities.
(12) Employees shall satisfy in good faith their obligations as citizens, including all
just financial obligations, especially those-such as Federal, State, or local taxes-that
are imposed by law.
(13) Employees shall adhere to all laws and regulations that provide equal
opportunity for all Americans regardless of race, color, religion, sex, national origin,
age, or handicap.
(14) Employees shall endeavor to avoid any actions creating the appearance that they
are violating the law or the ethical standards set forth in this part. Whether
particular circumstances create an appearance that the law or these standards have
been violated shall be determined from the perspective of a reasonable person with
knowledge of the relevant facts.
(c) Related statutes. In addition to the standards of ethical conduct set forth in this
part, there are conflict of interest statutes that prohibit certain conduct. Criminal
conflict of interest statutes of general applicability to all employees, 18 U.S.C. 201,
203, 205, 208, and 209, are summarized in the appropriate subparts of this part and
must be taken into consideration in determining whether conduct is proper. Citations
to other generally applicable statutes relating to employee conduct are set forth in
subpart I and employees are further cautioned that there may be additional statutory
and regulatory restrictions applicable to them generally or as employees of their
specific agencies. Because an employee is considered to be on notice of the
requirements of any statute, an employee should not rely upon any description or
synopsis of a statutory restriction, but should refer to the statute itself and obtain the
advice of an agency ethics official as needed.
$2635.102
Definitions.
The definitions listed below are used throughout this part. Additional definitions
appear in the subparts or sections of subparts to which they apply. For purposes of
this part:
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(a) Agency means an executive agency as defined in 5 U.S.C. 105 and the Postal
Service and the Postal Rate Commission. It does not include the General Accounting
Office or the Government of the District of Columbia.
(b) Agency designee refers to any employee who, by agency regulation, instruction,
or other issuance, has been delegated authority to make any determination, give any
approval, or take any other action required or permitted by this part with respect to
another employee. An agency may delegate these authorities to any number of agency
designees necessary to ensure that determinations are made, approvals are given,
and other actions are taken in a timely and responsible manner. Any provision that
requires a determination, approval, or other action by the agency designee shall,
where the conduct in issue is that of the agency head, be deemed to require that such
determination, approval or action be made or taken by the agency head in
consultation with the designated agency ethics official.
(c) Agency ethics official refers to the designated agency ethics official or to the
alternate designated agency ethics official, referred to in §2638.202(b) of this chapter,
and to any deputy ethics official, described in $2638.204 of this chapter, who has been
delegated authority to assist in carrying out the responsibilities of the designated
agency ethics official.
(d) Agency programs or operations refers to any program or function carried out or
performed by an agency, whether pursuant to statute, Executive order, or regulation.
(e) Corrective action includes any action necessary to remedy a past violation or
prevent a continuing violation of this part, including but not limited to restitution,
change of assignment, disqualification, divestiture, termination of an activity, waiver,
the creation of a qualified diversified or blind trust, or counseling.
(f) Designated agency ethics official refers to the official designated under $2638.201
of this chapter.
(g) Disciplinary action includes those disciplinary actions referred to in Office of
Personnel Management regulations and instructions implementing provisions of title
5 of the United States Code or provided for in comparable provisions applicable to
employees not subject to title 5, including but not limited to reprimand, suspension,
demotion, and removal. In the case of a military officer, comparable provisions may
include those in the Uniform Code of Military Justice.
(h) Employee means any officer or employee of an agency, including a special
Government employee. It includes officers but not enlisted members of the uniformed
services. For purposes other than subparts B and C of this part, it does not include
the President or Vice President. Status as an employee is unaffected by pay or leave
-5-
status or, in the case of a special Government employee, by the fact that the
individual does not perform official duties on a given day.
(i) Head of an agency means, in the case of an agency headed by more than one
person, the chair or comparable member of such agency.
(j) He, his, and him include she, hers and her.
(k) Person means an individual, corporation and subsidiaries it controls, company,
association, firm, partnership, society, joint stock company, or any other organization
or institution, including any officer, employee, or agent of such person or entity. For
purposes of this part, a corporation will be deemed to control a subsidiary if it owns
50 percent or more of the subsidiary's voting securities. The term is all-inclusive and
applies to commercial ventures and nonprofit organizations as well as to foreign,
State, and local governments, including the Government of the District of Columbia.
It does not include any agency or other entity of the Federal Government or any
officer or employee thereof when acting in his official capacity on behalf of that
agency or entity.
(1) Special Government employee means those executive branch officers or employees
specified in 18 U.S.C. 202(a). A special Government employee is retained, designated,
appointed, or employed to perform temporary duties either on a full-time or
intermittent basis, with or without compensation, for a period not to exceed 130 days
during any consecutive 365-day period.
(m) Supplemental agency regulation means a regulation issued pursuant to
$2635.105.
$2635.103
Applicability to members of the uniformed services.
The provisions of this part, except this section, are not applicable to enlisted members
of the uniformed services. Each agency with jurisdiction over enlisted members of the
uniformed services shall issue regulations defining the ethical conduct obligations of
enlisted members under its jurisdiction. Those regulations shall be consistent with
Executive Order 12674, April 12, 1989, as modified, and may prescribe the full range
of statutory and regulatory sanctions, including those available under the Uniform
Code of Military Justice, for failure to comply with such regulations.
$2635.104
Applicability to employees on detail.
-6-
(a) Details to other agencies. Except as provided in paragraph (d) of this section, an
employee on detail, including a uniformed officer on assignment, from his employing
agency to another agency for a period in excess of 30 calendar days shall be subject
to any supplemental agency regulations of the agency to which he is detailed rather
than to any supplemental agency regulations of his employing agency.
(b) Details to the legislative or judicial branch. An employee on detail, including a
uniformed officer on assignment, from his employing agency to the legislative or
judicial branch for a period in excess of 30 calendar days shall be subject to the
ethical standards of the branch or entity to which detailed. For the duration of any
such detail or assignment, the employee shall not be subject to the provisions of this
part, except this section, or, except as provided in paragraph (d) of this section, to any
supplemental agency regulations of his employing agency, but shall remain subject
to the conflict of interest prohibitions in title 18 of the United States Code.
(c) Details to non-Federal entities. Except to the extent exempted in writing pursuant
to this paragraph, an employee detailed to a non-Federal entity remains subject to
this part and to any supplemental agency regulation of his employing agency. When
an employee is detailed pursuant to statutory authority to an international
organization or to a State or local government for a period in excess of six months,
the designated agency ethics official may grant a written exemption from subpart B
of this part based on his determination that the entity has adopted written ethical
standards covering solicitation and acceptance of gifts which will apply to the
employee during the detail and which will be appropriate given the purpose of the
detail.
(d) Applicability of special agency statutes. Notwithstanding paragraphs (a) and (b)
of this section, an employee who is subject to an agency statute which restricts his
activities or financial holdings specifically because of his status as an employee of
that agency shall continue to be subject to any provisions in the supplemental agency
regulations of his employing agency that implement that statute.
$2635.105
Supplemental agency regulations.
In addition to the regulations set forth in this part, an employee shall comply with
any supplemental agency regulations issued by his employing agency under this
section.
(a) An agency that wishes to supplement this part shall prepare and submit to the
Office of Government Ethics, for its concurrence and joint issuance, any agency
regulations that supplement the regulations contained in this part. Supplemental
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agency regulations which the agency determines are necessary and appropriate, in
view of its programs and operations, to fulfill the purposes of this part shall be:
(1) In the form of a supplement to the regulations in this part; and
(2) In addition to the substantive provisions of this part.
(b) After concurrence and co-signature by the Office of Government Ethics, the agency
shall submit its supplemental agency regulations to the Federal Register for
publication and codification at the expense of the agency in title 5 of the Code of
Federal Regulations. Supplemental agency regulations issued under this section are
effective only after concurrence and co-signature by the Office of Government Ethics
and publication in the Federal Register.
(c) This section applies to any supplemental agency regulations or amendments
thereof issued under this part. It does not apply to:
(1) A handbook or other issuance intended merely as an explanation of the standards
contained in this part or in supplemental agency regulations;
(2) An instruction or other issuance the purpose of which is to:
(i) Delegate to an agency designee authority to make any determination, give any
approval or take any other action required or permitted by this part or by
supplemental agency regulations; or
(ii) Establish internal agency procedures for documenting or processing any
determination, approval or other action required or permitted by this part or by
supplemental agency regulations, or for retaining any such documentation; or
(3) Regulations or instructions that an agency has authority, independent of this part,
to issue, such as regulations implementing an agency's gift acceptance statute,
protecting categories of nonpublic information or establishing standards for use of
Government vehicles. Where the content of any such regulations or instructions was
included in the agency's standards of conduct regulations issued pursuant to
Executive Order 11222 and the Office of Government Ethics concurs that they need
not be issued as part of an agency's supplemental agency regulations, those
regulations or instructions may be promulgated separately from the agency's
supplemental agency regulations.
$2635.106
Disciplinary and corrective action.
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(a) Except as provided in $2635.107, a violation of this part or of supplemental agency
regulations may be cause for appropriate corrective or disciplinary action to be taken
under applicable Governmentwide regulations or agency procedures. Such action may
be in addition to any action or penalty prescribed by law.
(b) It is the responsibility of the employing agency to initiate appropriate disciplinary
or corrective action in individual cases. However, corrective action may be ordered or
disciplinary action recommended by the Director of the Office of Government Ethics
under the procedures at part 2638 of this chapter.
(c) A violation of this part or of supplemental agency regulations, as such, does not
create any right or benefit, substantive or procedural, enforceable at law by any
person against the United States, its agencies, its officers or employees, or any other
person. Thus, for example, an individual who alleges that an employee has failed to
adhere to laws and regulations that provide equal opportunity regardless of race,
color, religion, sex, national origin, age, or handicap is required to follow applicable
statutory and regulatory procedures, including those of the Equal Employment
Opportunity Commission.
$2635.107
Ethics advice.
(a) As required by §§2638.201 and 2638.202(b) of this chapter, each agency has a
designated agency ethics official who, on the agency's behalf, is responsible for
coordinating and managing the agency's ethics program, as well as an alternate. The
designated agency ethics official has authority under $2638.204 of this chapter to
delegate certain responsibilities, including that of providing ethics counseling
regarding the application of this part, to one or more deputy ethics officials.
(b) Employees who have questions about the application of this part or any
supplemental agency regulations to particular situations should seek advice from an
agency ethics official. Disciplinary action for violating this part or any supplemental
agency regulations will not be taken against an employee who has engaged in conduct
in good faith reliance upon the advice of an agency ethics official, provided that the
employee, in seeking such advice, has made full disclosure of all relevant
circumstances. Where the employee's conduct violates a criminal statute, reliance on
the advice of an agency ethics official cannot ensure that the employee will not be
prosecuted under that statute. However, good faith reliance on the advice of an
agency ethics official is a factor that may be taken into account by the Department
of Justice in the selection of cases for prosecution. Disclosures made by an employee
to an agency ethics official are not protected by an attorney-client privilege. An
agency ethics official is required by 28 U.S.C. 535 to report any information he
receives relating to a violation of the criminal code, title 18 of the United States Code.
-9-
Subpart B -- Gifts From Outside Sources
$2635.201
Overview.
This subpart contains standards that prohibit an employee from soliciting or
accepting any gift from a prohibited source or given because of the employee's official
position unless the item is excluded from the definition of a gift or falls within one
of the exceptions set forth in this subpart.
$2635.202
General standards.
(a) General prohibitions. Except as provided in this subpart, an employee shall not,
directly or indirectly, solicit or accept a gift:
(1) From a prohibited source; or
(2) Given because of the employee's official position.
(b) Relationship to illegal gratuities statute. Unless accepted in violation of paragraph
(c)(1) of this section, a gift accepted under the standards set forth in this subpart
shall not constitute an illegal gratuity otherwise prohibited by 18 U.S.C. 201(c)(1)(B).
(c) Limitations on use of exceptions. Notwithstanding any exception provided in this
subpart, other than §2635.204(j), an employee shall not:
(1) Accept a gift in return for being influenced in the performance of an official act;
(2) Solicit or coerce the offering of a gift;
(3) Accept gifts from the same or different sources on a basis so frequent that a
reasonable person would be led to believe the employee is using his public office for
private gain;
Example 1: A purchasing agent for a Veterans Administration hospital routinely
deals with representatives of pharmaceutical manufacturers who provide information
about new company products. Because of his crowded calendar, the purchasing agent
has offered to meet with manufacturer representatives during his lunch hours
Tuesdays through Thursdays and the representatives routinely arrive at the
employee's office bringing a sandwich and a soft drink for the employee. Even though
-10-
the market value of each of the lunches is less than $6 and the aggregate value from
any one manufacturer does not exceed the $50 aggregate limitation in §2635.204(a)
on de minimis gifts of $20 or less, the practice of accepting even these modest gifts
on a recurring basis is improper.
(4) Accept a gift in violation of any statute. Relevant statutes applicable to all
employees include:
(i) 18 U.S.C. 201(b), which prohibits a public official from seeking, accepting, or
agreeing to receive or accept anything of value in return for being influenced in the
performance of an official act or for being induced to take or omit to take any action
in violation of his official duty. As used in 18 U.S.C. 201(b), the term "public official"
is broadly construed and includes regular and special Government employees as well
as all other Government officials;
(ii) 18 U.S.C. 209, which prohibits an employee, other than a special Government
employee, from receiving any salary or any contribution to or supplementation of
salary from any source other than the United States as compensation for services as
a Government employee. The statute contains several specific exceptions to this
general prohibition, including an exception for contributions made from the treasury
of a State, county, or municipality; and
(iii) 41 U.S.C. 423(b)(2), which prohibits a procurement official from seeking,
accepting, or agreeing to receive any money, gratuity, or other thing of value from
any officer, employee, representative, agent, or consultant of a competing contractor
during the conduct of a Federal agency procurement. Implementing regulations,
including exceptions to the gift prohibition, are contained in the Federal Acquisition
Regulation, 48 CFR 3.104; or
(5) Accept vendor promotional training contrary to applicable regulations, policies or
guidance relating to the procurement of supplies and services for the Government,
except pursuant to §2635.204(1).
$2635.203
Definitions.
For purposes of this subpart, the following definitions shall apply:
(a) Agency has the meaning set forth in §2635.102(a). However, for purposes of this
subpart, an executive department, as defined in 5 U.S.C. 101, may, by supplemental
agency regulation, designate as a separate agency any component of that department
which the department determines exercises distinct and separate functions.
-11-
(b) Gift includes any gratuity, favor, discount, entertainment, hospitality, loan,
forbearance, or other item having monetary value. It includes services as well as gifts
of training, transportation, local travel, lodgings and meals, whether provided in-kind,
by purchase of a ticket, payment in advance, or reimbursement after the expense has
been incurred. It does not include:
(1) Modest items of food and refreshments, such as soft drinks, coffee and donuts,
offered other than as part of a meal;
(2) Greeting cards and items with little intrinsic value, such as plaques, certificates,
and trophies, which are intended solely for presentation;
(3) Loans from banks and other financial institutions on terms generally available to
the public;
(4) Opportunities and benefits, including favorable rates and commercial discounts,
available to the public or to a class consisting of all Government employees or all
uniformed military personnel, whether or not restricted on the basis of geographic
considerations;
(5) Rewards and prizes given to competitors in contests or events, including random
drawings, open to the public unless the employee's entry into the contest or event is
required as part of his official duties;
(6) Pension and other benefits resulting from continued participation in an employee
welfare and benefits plan maintained by a former employer;
(7) Anything which is paid for by the Government or secured by the Government
under Government contract;
Note: Some airlines encourage those purchasing tickets to join programs that award
free flights and other benefits to frequent fliers. Any such benefit earned on the basis
of Government-financed travel belongs to the agency rather than to the employee and
may be accepted only insofar as provided under 41 CFR 301-1.6(b).
(8) Any gift accepted by the Government under specific statutory authority, including:
(i) Travel, subsistence, and related expenses accepted by an agency under the
authority of 31 U.S.C. 1353 in connection with an employee's attendance at a meeting
or similar function relating to his official duties which takes place away from his duty
station. The agency's acceptance must be in accordance with the implementing
regulations at 41 CFR part 304-1; and
-12-
(ii) Other gifts provided in-kind which have been accepted by an agency under its
agency gift acceptance statute; or
(9) Anything for which market value is paid by the employee.
(c) Market value means the retail cost the employee would incur to purchase the gift.
An employee who cannot ascertain the market value of a gift may estimate its market
value by reference to the retail cost of similar items of like quality. The market value
of a gift of a ticket entitling the holder to food, refreshments, entertainment, or any
other benefit shall be the face value of the ticket.
Example 1: An employee who has been given an acrylic paperweight embedded with
the corporate logo of a prohibited source may determine its market value based on
her observation that a comparable acrylic paperweight, not embedded with a logo,
generally sells for about $20.
Example 2: A prohibited source has offered an employee a ticket to a charitable event
consisting of a cocktail reception to be followed by an evening of chamber music. Even
though the food, refreshments, and entertainment provided at the event may be
worth only $20, the market value of the ticket is its $250 face value.
(d) Prohibited source means any person who:
(1) Is seeking official action by the employee's agency;
(2) Does business or seeks to do business with the employee's agency;
(3) Conducts activities regulated by the employee's agency;
(4) Has interests that may be substantially affected by performance or
nonperformance of the employee's official duties; or
(5) Is an organization a majority of whose members are described in paragraphs (d)
(1) through (4) of this section.
(e) A gift is solicited or accepted because of the employee's official position if it is from
a person other than an employee and would not have been solicited, offered, or given
had the employee not held his position as a Federal employee.
Note: Gifts between employees are subject to the limitations set forth in subpart C
of this part.
Example 1: Where free season tickets are offered by an opera guild to all members
of the Cabinet, the gift is offered because of their official positions.
-13-
(f) A gift which is solicited or accepted indirectly includes a gift:
(1) Given with the employee's knowledge and acquiescence to his parent, sibling,
spouse, child, or dependent relative because of that person's relationship to the
employee, or
(2) Given to any other person, including any charitable organization, on the basis of
designation, recommendation, or other specification by the employee, except as
permitted for the disposition of perishable items by §2635.205(a)(2) or for payments
made to charitable organizations in lieu of honoraria under $2636.204 of this chapter.
Example 1: An employee who must decline a gift of a personal computer pursuant to
this subpart may not suggest that the gift be given instead to one of five charitable
organizations whose names are provided by the employee.
(g) Vendor promotional training means training provided by any person for the
purpose of promoting its products or services. It does not include training provided
under a Government contract or by a contractor to facilitate use of products or
services it furnishes under a Government contract.
$2635.204
Exceptions.
The prohibitions set forth in §2635.202(a) do not apply to a gift accepted under the
circumstances described in paragraphs (a) through (1) of this section and a gift
accepted in accordance with one of those paragraphs will not be deemed to violate the
principles set forth in §2635.101(b). Even though acceptance of a gift may be
permitted by one of the exceptions contained in paragraphs (a) through (1) of this
section, it is never inappropriate and frequently prudent for an employee to decline
a gift offered by a prohibited source or because of his official position.
(a) Gifts of $20 or less. An employee may accept unsolicited gifts having an aggregate
market value of $20 or less per occasion, provided that the aggregate market value
of individual gifts received from any one person under the authority of this paragraph
shall not exceed $50 in a calendar year. This exception does not apply to gifts of cash
or of investment interests such as stock, bonds, or certificates of deposit. Where the
market value of a gift or the aggregate market value of gifts offered on any single
occasion exceeds $20, the employee may not pay the excess value over $20 in order
to accept that portion of the gift or those gifts worth $20. Where the aggregate value
of tangible items offered on a single occasion exceeds $20, the employee may decline
any distinct and separate item in order to accept those items aggregating $20 or less.
-14-
Example 1: An employee of the Securities and Exchange Commission and his spouse
have been invited by a representative of a regulated entity to a Broadway play,
tickets to which have a face value of $30 each. The aggregate market value of the
gifts offered on this single occasion is $60, $40 more than the $20 amount that may
be accepted for a single event or presentation. The employee may not accept the gift
of the evening of entertainment. He and his spouse may attend the play only if he
pays the full $60 value of the two tickets.
Example 2: An employee of the Defense Mapping Agency has been invited by an
association of cartographers to speak about his agency's role in the evolution of
missile technology. At the conclusion of his speech, the association presents the
employee a framed map with a market value of $18 and a book about the history of
cartography with a market value of $15. The employee may accept the map or the
book, but not both, since the aggregate value of these two tangible items exceeds $20.
Example 3: On four occasions during the calendar year, an employee of the Defense
Logistics Agency was given gifts worth $10 each by four employees of a corporation
that is a DLA contractor. For purposes of applying the yearly $50 limitation on gifts
of $20 or less from any one person, the four gifts must be aggregated because a
person is defined at §2635.102(k) to mean not only the corporate entity, but its
officers and employees as well. However, for purposes of applying the $50 aggregate
limitation, the employee would not have to include the value of a birthday present
received from his cousin, who is employed by the same corporation, if he can accept
the birthday present under the exception at §2635.204(b) for gifts based on a personal
relationship.
Example 4: Under the authority of 31 U.S.C. 1353 for agencies to accept payments
from non-Federal sources in connection with attendance at certain meetings or
similar functions, the Environmental Protection Agency has accepted an association's
gift of travel expenses and conference fees for an employee of its Office of Radiation
Programs to attend an international conference on "The Chernobyl Experience."
While at the conference, the employee may accept a gift of $20 or less from the
association or from another person attending the conference even though it was not
approved in advance by the EPA. Although 31 U.S.C. 1353 is the only authority
under which an agency may accept gifts from certain non-Federal sources in
connection with its employees' attendance at such functions, a gift of $20 or less
accepted under §2635.204(a) is a gift to the employee rather than to his employing
agency.
Example 5: A Navy contracting officer is participating in a procurement for
environmental cleanup services at a Navy installation that has recently been closed.
She is presently involved in negotiations with three competing contractors, one of
whom has offered her a fancy ballpoint pen embossed with its corporate logo. Even
though the pen has a market value of $18 and could be accepted under the $20 de
-15-
minimis exception at §2635.204(a), the contracting officer cannot accept the
competing contractor's gift. Under the procurement integrity provisions at 41 U.S.C.
423, she is a "procurement official" for that contract and, except as specifically
permitted by the regulations implementing that statute, she is prohibited prior to
award from accepting a gift from a competing contractor for that contract. The
Federal Acquisition Regulation at 48 CFR 3.104 contains an exception for gifts with
a market value of $10 or less.
(b) Gifts based on a personal relationship. An employee may accept a gift given under
circumstances which make it clear that the gift is motivated by a family relationship
or personal friendship rather than the position of the employee. Relevant factors in
making such a determination include the history of the relationship and whether the
family member or friend personally pays for the gift.
Example 1: An employee of the Federal Deposit Insurance Corporation has been
dating a secretary employed by a member bank. For Secretary's Week, the bank has
given each secretary 2 tickets to an off-Broadway musical review and has urged each
to invite a family member or friend to share the evening of entertainment. Under the
circumstances, the FDIC employee may accept his girlfriend's invitation to the
theater. Even though the tickets were initially purchased by the member bank, they
were given without reservation to the secretary to use as she wished, and her
invitation to the employee was motivated by their personal friendship.
Example 2: Three partners in a law firm that handles corporate mergers have invited
an employee of the Federal Trade Commission to join them in a golf tournament at
a private club at the firm's expense. The entry fee is $500 per foursome. The
employee cannot accept the gift of one-quarter of the entry fee even though he and
the three partners have developed an amicable relationship as a result of the firm's
dealings with the FTC. As evidenced in part by the fact that the fees are to be paid
by the firm, it is not a personal friendship but a business relationship that is the
motivation behind the partners' gift.
(c) Discounts and similar benefits. In addition to those opportunities and benefits
excluded from the definition of a gift by §2635.203(b)(4), an employee may accept:
(1) Reduced membership or other fees for participation in organization activities
offered to all Government employees or all uniformed military personnel by
professional organizations if the only restrictions on membership relate to
professional qualifications; and
(2) Opportunities and benefits, including favorable rates and commercial discounts
not precluded by paragraph (c)(3) of this section:
-16-
(i) Offered to members of a group or class in which membership is unrelated to
Government employment;
(ii) Offered to members of an organization, such as an employees' association or
agency credit union, in which membership is related to Government employment if
the same offer is broadly available to large segments of the public through
organizations of similar size; or
(iii) Offered by a person who is not a prohibited source to any group or class that is
not defined in a manner that specifically discriminates among Government employees
on the basis of type of official responsibility or on a basis that favors those of higher
rank or rate of pay; provided, however, that
(3) An employee may not accept for personal use any benefit to which the
Government is entitled as the result of an expenditure of Government funds.
Example 1: An employee of the Consumer Product Safety Commission may accept a
discount of $50 on a microwave oven offered by the manufacturer to all members of
the CPSC employees' association. Even though the CPSC is currently conducting
studies on the safety of microwave ovens, the $50 discount is a standard offer that
the manufacturer has made broadly available through a number of similar
organizations to large segments of the public.
Example 2: An Assistant Secretary may not accept a local country club's offer of
membership to all members of Department Secretariats which includes a waiver of
its $5,000 membership initiation fee. Even though the country club is not a prohibited
source, the offer discriminates in favor of higher ranking officials.
Example 3: The administrative officer for a district office of the Immigration and
Naturalization Service has signed an INS order to purchase 50 boxes of photocopy
paper from a supplier whose literature advertises that it will give a free briefcase to
anyone who purchases 50 or more boxes. Because the paper was purchased with INS
funds, the administrative officer cannot keep the briefcase which, if claimed and
received, is Government property.
(d) Awards and honorary degrees. (1) An employee may accept gifts, other than cash
or an investment interest, with an aggregate market value of $200 or less if such gifts
are a bona fide award or incident to a bona fide award that is given for meritorious
public service or achievement by a person who does not have interests that may be
substantially affected by the performance or nonperformance of the employee's official
duties or by an association or other organization the majority of whose members do
not have such interests. Gifts with an aggregate market value in excess of $200 and
awards of cash or investment interests offered by such persons as awards or incidents
of awards that are given for these purposes may be accepted upon a written
-17-
determination by an agency ethics official that the award is made as part of an
established program of recognition:
(i) Under which awards have been made on a regular basis or which is funded, wholly
or in part, to ensure its continuation on a regular basis; and
(ii) Under which selection of award recipients is made pursuant to written standards.
(2) An employee may accept an honorary degree from an institution of higher
education as defined at 20 U.S.C. 1141(a) based on a written determination by an
agency ethics official that the timing of the award of the degree would not cause a
reasonable person to question the employee's impartiality in a matter affecting the
institution.
(3) An employee who may accept an award or honorary degree pursuant to paragraph
(d)(1) or (2) of this section may also accept meals and entertainment given to him and
to members of his family at the event at which the presentation takes place.
Example 1: Based on a determination by an agency ethics official that the prize meets
the criteria set forth in §2635.204(d)(1), an employee of the National Institutes of
Health may accept the Nobel Prize for Medicine, including the cash award which
accompanies the prize, even though the prize was conferred on the basis of laboratory
work performed at NIH.
Example 2: Prestigious University wishes to give an honorary degree to the Secretary
of Labor. The Secretary may accept the honorary degree only if an agency ethics
official determines in writing that the timing of the award of the degree would not
cause a reasonable person to question the Secretary's impartiality in a matter
affecting the university.
Example 3: An ambassador selected by a nonprofit organization as recipient of its
annual award for distinguished service in the interest of world peace may, together
with his wife, and children, attend the awards ceremony dinner and accept a crystal
bowl worth $200 presented during the ceremony. However, where the organization
has also offered airline tickets for the ambassador and his family to travel to the city
where the awards ceremony is to be held, the aggregate value of the tickets and the
crystal bowl exceeds $200 and he may accept only upon a written determination by
the agency ethics official that the award is made as part of an established program
of recognition.
(e) Gifts based on outside business or employment relationships. An employee may
accept meals, lodgings, transportation and other benefits:
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(1) Resulting from the business or employment activities of an employee's spouse
when it is clear that such benefits have not been offered or enhanced because of the
employee's official position;
Example 1: A Department of Agriculture employee whose husband is a computer
programmer employed by an Agriculture Department contractor may attend the
company's annual retreat for all of its employees and their families held at a resort
facility. However, under $2635.502, the employee may be disqualified from performing
official duties affecting her husband's employer.
Example 2: Where the spouses of other clerical personnel have not been invited, an
employee of the Defense Contract Audit Agency whose wife is a clerical worker at a
defense contractor may not attend the contractor's annual retreat in Hawaii for
corporate officers and members of the board of directors, even though his wife
received a special invitation for herself and her spouse.
(2) Resulting from his outside business or employment activities when it is clear that
such benefits have not been offered or enhanced because of his official status; or
Example 1: The members of an Army Corps of Engineers environmental advisory
committee that meets 6 times per year are special Government employees. A member
who has a consulting business may accept an invitation to a $50 dinner from her
corporate client, an Army construction contractor, unless, for example, the invitation
was extended in order to discuss the activities of the committee.
(3) Customarily provided by a prospective employer in connection with bona fide
employment discussions. If the prospective employer has interests that could be
affected by performance or nonperformance of the employee's duties, acceptance is
permitted only if the employee first has complied with the disqualification
requirements of subpart F of this part applicable when seeking employment.
Example 1: An employee of the Federal Communications Commission with
responsibility for drafting regulations affecting all cable television companies wishes
to apply for a job opening with a cable television holding company. Once she has
properly disqualified herself from further work on the regulations as required by
subpart F of this part, she may enter into employment discussions with the company
and may accept the company's offer to pay for her airfare, hotel and meals in
connection with an interview trip.
(4) For purposes of paragraphs (e)(1) through (3) of this section, employment shall
have the meaning set forth in §2635.603(a).
(f) Gifts from a political organization. An employee who is exempt under 5 U.S.C.
7324(d) from the Hatch Act prohibitions against active participation in political
-19-
management or political campaigns may accept meals, lodgings, transportation and
other benefits, including free attendance at events, when provided, in connection with
such active participation, by a political organization described in 26 U.S.C. 527(e).
Any other employee, such as a security officer, whose official duties require him to
accompany an exempt employee to a political event may accept meals, free attendance
and entertainment provided at the event by such a political organization.
Example 1: The Secretary of the Department of Health and Human Services is
exempt from the noted Hatch Act restrictions. He may accept an airline ticket and
hotel accommodations furnished by the campaign committee of a candidate for the
United States Senate in order to give a speech in support of the candidate.
(g) Widely attended gatherings and other events-(1) Speaking and similar
engagements. When an employee is assigned to participate as a speaker or panel
participant or otherwise to present information on behalf of the agency at a
conference or other event, his acceptance of an offer of free attendance at the event
on the day of his presentation is permissible when provided by the sponsor of the
event. The employee's participation in the event on that day is viewed as a customary
and necessary part of his performance of the assignment and does not involve a gift
to him or to the agency.
(2) Widely attended gatherings. When there has been a determination that his
attendance is in the interest of the agency because it will further agency programs
or operations, an employee may accept a sponsor's unsolicited gift of free attendance
at all or appropriate parts of a widely attended gathering of mutual interest to a
number of parties. A gathering is widely attended if, for example, it is open to
members from throughout a given industry or profession or if those in attendance
represent a range of persons interested in a given matter. For employees subject to
a leave system, attendance at the event shall be on the employee's own time or, if
authorized by the employee's agency, on excused absence pursuant to applicable
guidelines for granting such absence, or otherwise without charge to the employee's
leave account.
(3) Determination of agency interest. The determination of agency interest required
by paragraph (g)(2) of this section shall be made orally or in writing by the agency
designee.
(i) If the sponsor is a person who has interests that may be substantially affected by
the performance or nonperformance of an employee's official duties or an association
or organization the majority of whose members have such interests, the employee's
participation may be determined to be in the interest of the agency only where there
is a written finding by the agency designee that the agency's interest in the
employee's participation in the event outweighs concern that acceptance of the gift
of free attendance may or may appear to improperly influence the employee in the
-20-
performance of his official duties. Relevant factors that should be considered by the
agency designee include the importance of the event to the agency, the nature and
sensitivity of any pending matter affecting the interests of the sponsor of the event,
the significance of the employee's role in any such matter, the purpose of the event,
the identity of other expected participants and the monetary value of the gift of free
attendance.
(ii) A blanket determination of agency interest may be issued to cover all or any
category of invitees other than those as to whom a finding is required by paragraph
(g)(3)(i) of this section. Where a finding under paragraph (g)(3)(i) of this section is
required, a written determination of agency interest, including the necessary finding,
may be issued to cover two or more employees whose duties similarly affect the
interests of the sponsor or its members.
(4) Free attendance. For purposes of paragraphs (g) (1) and (2) of this section, free
attendance may include waiver of all or part of a conference or other fee or the
provision of food, refreshments, entertainment, instruction and materials furnished
to all attendees as an integral part of the event. It does not include travel expenses,
lodgings, entertainment collateral to the event, or meals taken other than in a group
setting with all other attendees.
Note: There are statutory authorities implemented other than by part 2635 under
which an agency or an employee may be able to accept free attendance or other items
not included in the definition of free attendance, such as travel expenses.
(5) Cost provided by sponsor of event. The cost of the employee's attendance will not
be considered to be provided by the sponsor where a person other than the sponsor
designates the employee to be invited and bears the cost of the employee's attendance
through a contribution or other payment intended to facilitate that employee's
attendance. Payment of dues or a similar assessment to a sponsoring organization
does not constitute a payment intended to facilitate a particular employee's
attendance.
(6) Accompanying spouse. When others in attendance will generally be accompanied
by spouses, the agency designee may authorize an employee to accept a sponsor's
invitation to an accompanying spouse to participate in all or a portion of the event
at which the employee's free attendance is permitted under paragraph (g)(1) or (2)
of this section. The authorization required by this paragraph may be provided orally
or in writing.
Example 1: An aerospace industry association that is a prohibited source sponsors a
seminar for which it charges a fee of $100. An Air Force contractor pays $500 to the
association so that the association can extend free invitations to five Air Force
officials designated by the contractor. The Air Force officials may not accept the gifts
-21-
of free attendance. Because the contractor specified the invitees and bore the cost of
their attendance, the gift of free attendance is considered to be provided by the
company and not by the sponsoring association. Had the contractor paid $500 to the
association in order that it might invite any five Federal employees, an Air Force
official to whom the sponsoring association extended one of the five invitations could
attend if his participation were determined to be in the interest of the agency.
Example 2: An employee of the Department of the Treasury authorized to participate
in a panel discussion of economic issues as part of a one-day conference may accept
the sponsor's waiver of the conference fee. Under the separate authority of
§2635.204(a), he may accept a token of appreciation for his speech having a market
value of $20 or less.
Example 3: An Assistant U.S. Attorney is invited to attend a luncheon meeting of a
local bar association to hear a distinguished judge lecture on cross-examining expert
witnesses. Although members of the bar association are assessed a $15 fee for the
meeting, the Assistant U.S. Attorney may accept the bar association's offer to attend
for free, even without a determination of agency interest. The gift can be accepted
under the $20 de minimis exception at §2635.204(a).
Example 4: An employee of the Department of the Interior authorized to speak on the
first day of a four-day conference on endangered species may accept the sponsor's
waiver of the conference fee for the first day of the conference. If the conference is
widely attended, he may be authorized, based on a determination that his attendance
is in the agency's interest, to accept the sponsor's offer to waive the attendance fee
for the remainder of the conference.
(h) Social invitations from persons other than prohibited sources. An employee may
accept food, refreshments and entertainment, not including travel or lodgings, at a
social event attended by several persons where:
(1) The invitation is from a person who is not a prohibited source; and
(2) No fee is charged to any person in attendance.
Example 1: Along with several other Government officials and a number of
individuals from the private sector, the Administrator of the Environmental
Protection Agency has been invited to the premier showing of a new adventure movie
about industrial espionage. The producer is paying all costs of the showing. The
Administrator may accept the invitation since the producer is not a prohibited source
and no attendance fee is being charged to anyone who has been invited.
Example 2: An employee of the White House Press Office has been invited to a
cocktail party given by a noted Washington hostess who is not a prohibited source.
-22-
The employee may attend even though he has only recently been introduced to the
hostess and suspects that he may have been invited because of his official position.
(i) Meals, refreshments and entertainment in foreign areas. An employee assigned to
duty in, or on official travel to, a foreign area as defined in 41 CFR 301-7.3(c) may
accept food, refreshments or entertainment in the course of a breakfast, luncheon,
dinner or other meeting or event provided:
(1) The market value in the foreign area of the food, refreshments or entertainment
provided at the meeting or event, as converted to U.S. dollars, does not exceed the per
diem rate for the foreign area specified in the U.S. Department of State's Maximum
Per Diem Allowances for Foreign Areas, Per Diem Supplement Section 925 to the
Standardized Regulations (GC,FA) available from the Superintendent of Documents,
U.S. Government Printing Office, Washington, DC 20402;
(2) There is participation in the meeting or event by non-U.S. citizens or by
representatives of foreign governments or other foreign entities;
(3) Attendance at the meeting or event is part of the employee's official duties to
obtain information, disseminate information, promote the export of U.S. goods and
services, represent the United States or otherwise further programs or operations of
the agency or the U.S. mission in the foreign area; and
(4) The gift of meals, refreshments or entertainment is from a person other than a
foreign government as defined in 5 U.S.C. 7342(a)(2).
Example 1: A number of local businessmen in a developing country are anxious for
a U.S. company to locate a manufacturing facility in their province. An official of the
Overseas Private Investment Corporation may accompany the visiting vice president
of the U.S. company to a dinner meeting hosted by the businessmen at a province
restaurant where the market value of the food and refreshments does not exceed the
per diem rate for that country.
(j) Gifts to the President or Vice President. Because of considerations relating to the
conduct of their offices, including those of protocol and etiquette, the President or the
Vice President may accept any gift on his own behalf or on behalf of any family
member, provided that such acceptance does not violate §2635.202(c) (1) or (2), 18
U.S.C. 201(b) or 201(c)(3), or the Constitution of the United States.
(k) Gifts authorized by supplemental agency regulation. An employee may accept any
gift the acceptance of which is specifically authorized by a supplemental agency
regulation.
-23-
(1) Gifts accepted under specific statutory authority. The prohibitions on acceptance
of gifts from outside sources contained in this subpart do not apply to any item,
receipt of which is specifically authorized by statute. Gifts which may be received by
an employee under the authority of specific statutes include, but are not limited to:
(1) Free attendance, course or meeting materials, transportation, lodgings, food and
refreshments or reimbursements therefor incident to training or meetings when
accepted by the employee under the authority of 5 U.S.C. 4111 from an organization
with tax-exempt status under 26 U.S.C. 501(c)(3) or from a person to whom the
prohibitions in 18 U.S.C. 209 do not apply. The employee's acceptance must be
approved by the agency in accordance with $410.701 through $410.706 of this title;
or
Note: 26 U.S.C. 501(c)(3) is authority for tax-exempt treatment of a limited class of
nonprofit organizations, including those organized and operated for charitable,
religious or educational purposes. Many nonprofit organizations are not exempt from
taxation under this section.
(2) Gifts from a foreign government or international or multinational organization,
or its representative, when accepted by the employee under the authority of the
Foreign Gifts and Decorations Act, 5 U.S.C. 7342. As a condition of acceptance, an
employee must comply with requirements imposed by the agency's regulations or
procedures implementing that Act.
$2635.205
Proper disposition of prohibited gifts.
(a) An employee who has received a gift that cannot be accepted under this subpart
shall, unless the gift is accepted by an agency acting under specific statutory
authority:
(1) Return any tangible item to the donor or pay the donor its market value. An
employee who cannot ascertain the actual market value of an item may estimate its
market value by reference to the retail cost of similar items of like quality. See
§2635.203(c).
Example 1: To avoid public embarrassment to the seminar sponsor, an employee of
the National Park Service did not decline a barometer worth $200 given at the
conclusion of his speech on Federal lands policy. The employee must either return the
barometer or promptly reimburse the sponsor $200.
-24-
(2) When it is not practical to return a tangible item because it is perishable, the item
may, at the discretion of the employee's supervisor or an agency ethics official, be
given to an appropriate charity, shared within the recipient's office, or destroyed.
Example 1: With approval by the recipient's supervisor, a floral arrangement sent by
a disability claimant to a helpful employee of the Social Security Administration may
be placed in the office's reception area.
(3) For any entertainment, favor, service, benefit or other intangible, reimburse the
donor the market value. Subsequent reciprocation by the employee does not constitute
reimbursement.
Example 1: A Department of Defense employee wishes to attend a charitable event
to which he has been offered a $300 ticket by a prohibited source. Although his
attendance is not in the interest of the agency under §2635.204(g), he may attend if
he reimburses the donor the $300 face value of the ticket.
(4) Dispose of gifts from foreign governments or international organizations in
accordance with 41 CFR part 101-49, and dispose of materials received in conjunction
with official travel in accordance with 41 CFR 101-25.103.
(b) An agency may authorize disposition or return of gifts at Government expense.
Employees may use penalty mail to forward reimbursements required or permitted
by this section.
(c) An employee who, on his own initiative, promptly complies with the requirements
of this section will not be deemed to have improperly accepted an unsolicited gift. An
employee who promptly consults his agency ethics official to determine whether
acceptance of an unsolicited gift is proper and who, upon the advice of the ethics
official, returns the gift or otherwise disposes of the gift in accordance with this
section, will be considered to have complied with the requirements of this section on
his own initiative.
Subpart C -- Gifts Between Employees
$2635.301
Overview.
This subpart contains standards that prohibit an employee from giving, donating to,
or soliciting contributions for, a gift to an official superior and from accepting a gift
from an employee receiving less pay than himself, unless the item is excluded from
the definition of a gift or falls within one of the exceptions set forth in this subpart.
-25-
$2635.302
General standards.
(a) Gifts to superiors. Except as provided in this subpart, an employee may not:
(1) Directly or indirectly, give a gift to or make a donation toward a gift for an official
superior; or
(2) Solicit a contribution from another employee for a gift to either his own or the
other employee's official superior.
(b) Gifts from employees receiving less pay. Except as provided in this subpart, an
employee may not, directly or indirectly, accept a gift from an employee receiving less
pay than himself unless:
(1) The two employees are not in a subordinate-official superior relationship; and
(2) There is a personal relationship between the two employees that would justify the
gift.
(c) Limitation on use of exceptions. Notwithstanding any exception provided in this
subpart, an official superior shall not coerce the offering of a gift from a subordinate.
$2635.303
Definitions.
For purposes of this subpart, the following definitions shall apply:
(a) Gift has the meaning set forth in §2635.203(b). For purposes of that definition an
employee will be deemed to have paid market value for any benefit received as a
result of his participation in any carpool or other such mutual arrangement involving
another employee or other employees if he bears his fair proportion of the expense or
effort involved.
(b) Indirectly, for purposes of §2635.302(b), has the meaning set forth in §2635.203(f).
For purposes of §2635.302(a), it includes a gift:
(1) Given with the employee's knowledge and acquiescence by his parent, sibling,
spouse, child, or dependent relative; or
-26-
(2) Given by a person other than the employee under circumstances where the
employee has promised or agreed to reimburse that person or to give that person
something of value in exchange for giving the gift.
(c) Subject to paragraph (a) of this section, market value has the meaning set forth
in §2635.203(c).
(d) Official superior means any other employee, other than the President and the Vice
President, including but not limited to an immediate supervisor, whose official
responsibilities include directing or evaluating the performance of the employee's
official duties or those of any other official superior of the employee. For purposes of
this subpart, an employee is considered to be the subordinate of any of his official
superiors.
(e) Solicit means to request contributions by personal communication or by general
announcement.
(f) Voluntary contribution means a contribution given freely, without pressure or
coercion. A contribution is not voluntary unless it is made in an amount determined
by the contributing employee, except that where an amount for a gift is included in
the cost for a luncheon, reception or similar event, an employee who freely chooses
to pay a proportionate share of the total cost in order to attend will be deemed to
have made a voluntary contribution. Except in the case of contributions for a gift
included in the cost of a luncheon, reception or similar event, a statement that an
employee may choose to contribute less or not at all shall accompany any
recommendation of an amount to be contributed for a gift to an official superior.
Example 1: A supervisory employee of the Agency for International Development has
just been reassigned from Washington, DC to Kabul, Afghanistan. As a farewell
party, 12 of her subordinates have decided to take her out to lunch at the Khyber
Repast. It is understood that each will pay for his own meal and that the cost of the
supervisor's lunch will be divided equally among the twelve. Even though the amount
they will contribute is not determined until the supervisor orders lunch, the
contribution made by those who choose to participate in the farewell lunch is
voluntary.
$2635.304
Exceptions.
The prohibitions set forth in §2635.302(a) and (b) do not apply to a gift given or
accepted under the circumstances described in paragraph (a) or (b) of this section. A
contribution or the solicitation of a contribution that would otherwise violate the
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prohibitions set forth in §2635.302(a) and (b) may only be made in accordance with
paragraph (c) of this section.
(a) General exceptions. On an occasional basis, including any occasion on which gifts
are traditionally given or exchanged, the following may be given to an official superior
or accepted from a subordinate or other employee receiving less pay:
(1) Items, other than cash, with an aggregate market value of $10 or less per
occasion;
(2) Items such as food and refreshments to be shared in the office among several
employees;
(3) Personal hospitality provided at a residence which is of a type and value
customarily provided by the employee to personal friends;
(4) Items given in connection with the receipt of personal hospitality if of a type and
value customarily given on such occasions; and
(5) Leave transferred under subpart I of part 630 of this title to an employee who is
not an immediate supervisor, unless obtained in violation of $630.912 of this title.
Example 1: Upon returning to work following a vacation at the beach, a claims
examiner with the Department of Veterans Affairs may give his supervisor, and his
supervisor may accept, a bag of saltwater taffy purchased on the boardwalk for $8.
Example 2: An employee of the Federal Deposit Insurance Corporation whose bank
examination responsibilities require frequent travel may not bring her supervisor,
and her supervisor may not accept, souvenir coffee mugs from each of the cities she
visits in the course of performing her duties, even though each of the mugs costs less
than $5. Gifts given on this basis are not occasional.
Example 3: The Secretary of Labor has invited the agency's General Counsel to a
dinner party at his home. The General Counsel may bring a $15 bottle of wine to the
dinner party and the Secretary may accept this customary hostess gift from his
subordinate, even though its cost is in excess of $10.
Example 4: For Christmas, a secretary may give his supervisor, and the supervisor
may accept, a poinsettia plant purchased for $10 or less. The secretary may also
invite his supervisor to a Christmas party in his home and the supervisor may
attend.
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(b) Special, infrequent occasions. A gift appropriate to the occasion may be given to
an official superior or accepted from a subordinate or other employee receiving less
pay:
(1) In recognition of infrequently occurring occasions of personal significance such as
marriage, illness, or the birth or adoption of a child; or
(2) Upon occasions that terminate a subordinate-official superior relationship, such
as retirement, resignation, or transfer.
Example 1: The administrative assistant to the personnel director of the Tennessee
Valley Authority may send a $30 floral arrangement to the personnel director who
is in the hospital recovering from surgery. The personnel director may accept the gift.
Example 2: A chemist employed by the Food and Drug Administration has been
invited to the wedding of the lab director who is his official superior. He may give the
lab director and his bride, and they may accept, a place setting in the couple's
selected china pattern purchased for $70.
Example 3: Upon the occasion of the supervisor's retirement from Federal service, an
employee of the Fish and Wildlife Service may give her supervisor a book of wildlife
photographs which she purchased for $19. The retiring supervisor may accept the
book.
(c) Voluntary contributions. An employee may solicit voluntary contributions of
nominal amounts from fellow employees for an appropriate gift to an official superior
and an employee may make a voluntary contribution of a nominal amount to an
appropriate gift to an official superior:
(1) On a special, infrequent occasion as described in paragraph (b) of this section; or
(2) On an occasional basis, for items such as food and refreshments to be shared in
the office among several employees.
An employee may accept such gifts to which a subordinate or other employee
receiving less pay than himself has contributed.
Example 1: To mark the occasion of his retirement, members of the immediate staff
of the Under Secretary of the Army would like to give him a party and provide him
with a gift certificate. They may distribute an announcement of the party and include
a nominal amount for a retirement gift in the fee for the party.
-29-
Example 2: The General Counsel of the National Endowment for the Arts may not
collect contributions for a Christmas gift for the Chairman. Christmas occurs
annually and is not an occasion of personal significance.
Example 3: Subordinates may not take up a collection for a gift to an official superior
on the occasion of the superior's swearing in or promotion to a higher grade position
within the supervisory chain of that organization. These are not events that mark the
termination of the subordinate-official superior relationship, nor are they events of
personal significance within the meaning of §2635.304(b). However, subordinates may
take up a collection and employees may contribute $3 each to buy refreshments to be
consumed by everyone in the immediate office to mark either such occasion.
Example 4: Subordinates may each contribute a nominal amount to a fund to give a
gift to an official superior upon the occasion of that superior's transfer or promotion
to a position outside the organization.
Example 5: An Assistant Secretary at the Department of the Interior is getting
married. His secretary has decided that a microwave oven would be a nice gift from
his staff and has informed each of the Assistant Secretary's subordinates that they
should contribute $5 for the gift. Her method of collection is improper. Although she
may recommend a $5 contribution, the recommendation must be coupled with a
statement that the employee whose contribution is solicited is free to contribute less
or nothing at all.
Subpart D -- Conflicting Financial Interests
$2635.401
Overview.
This subpart contains two provisions relating to financial interests. One is a
disqualification requirement and the other is a prohibition on acquiring or continuing
to hold specific financial interests. An employee may acquire or hold any financial
interest not prohibited by $2635.403. Notwithstanding that his acquisition or holding
of a particular interest is proper, an employee is prohibited in accordance with
$2635.402 of this subpart from participating in an official capacity in any particular
matter in which, to his knowledge, he or any person whose interests are imputed to
him has a financial interest, if the particular matter will have a direct and
predictable effect on that interest.
$2635.402
Disqualifying financial interests.
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(a) Statutory prohibition. An employee is prohibited by criminal statute, 18 U.S.C.
208(a), from participating personally and substantially in an official capacity in any
particular matter in which, to his knowledge, he or any person whose interests are
imputed to him under this statute has a financial interest, if the particular matter
will have a direct and predictable effect on that interest.
Note: Standards applicable when seeking non-Federal employment are contained in
subpart F of this part and, if followed, will ensure that an employee does not violate
18 U.S.C. 208(a) or this section when he is negotiating for or has an arrangement
concerning future employment. In all other cases where the employee's participation
would violate 18 U.S.C. 208(a), an employee shall disqualify himself from
participation in the matter in accordance with paragraph (c) of this section or obtain
a waiver, as described in paragraph (d) of this section.
(b) Definitions. For purposes of this section, the following definitions shall apply:
(1) Direct and predictable effect. (i) A particular matter will have a direct effect on
a financial interest if there is a close causal link between any decision or action to be
taken in the matter and any expected effect of the matter on the financial interest.
An effect may be direct even though it does not occur immediately. A particular
matter will not have a direct effect on a financial interest, however, if the chain of
causation is attenuated or is contingent upon the occurrence of events that are
speculative or that are independent of, and unrelated to, the matter. A particular
matter that has an effect on a financial interest only as a consequence of its effects
on the general economy does not have a direct effect within the meaning of this
subpart.
(ii) A particular matter will have a predictable effect if there is a real, as opposed to
a speculative possibility that the matter will affect the financial interest. It is not
necessary, however, that the magnitude of the gain or loss be known, and the dollar
amount of the gain or loss is immaterial.
Note: If a particular matter involves a specific party or parties, generally the matter
will at most only have a direct and predictable effect, for purposes of this subpart, on
a financial interest of the employee in or with a party, such as the employee's interest
by virtue of owning stock. There may, however, be some situations in which, under
the above standards, a particular matter will have a direct and predictable effect on
an employee's financial interests in or with a nonparty. For example, if a party is a
corporation, a particular matter may also have a direct and predictable effect on an
employee's financial interests through ownership of stock in an affiliate, parent, or
subsidiary of that party. Similarly, the disposition of a protest against the award of
a contract to a particular company may also have a direct and predictable effect on
an employee's financial interest in another company listed as a subcontractor in the
proposal of one of the competing offerors.
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Example 1: An employee of the National Library of Medicine at the National
Institutes of Health has just been asked to serve on the technical evaluation panel
to review proposals for a new library computer search system. DEF Computer
Corporation, a closely held company in which he and his wife own a majority of the
stock, has submitted a proposal. Because award of the systems contract to DEF or to
any other offeror will have a direct and predictable effect on both his and his wife's
financial interests, the employee cannot participate on the technical evaluation team
unless his disqualification has been waived.
Example 2: Upon assignment to the technical evaluation panel, the employee in the
preceding example finds that DEF Computer Corporation has not submitted a
proposal. Rather, LMN Corp., with which DEF competes for private sector business,
is one of the six offerors. The employee is not disqualified from serving on the
technical evaluation panel. Any effect on the employee's financial interests as a result
of the agency's decision to award or not award the systems contract to LMN would
be at most indirect and speculative.
(2) Imputed interests. For purposes of 18 U.S.C. 208(a) and this subpart, the financial
interests of the following persons will serve to disqualify an employee to the same
extent as if they were the employee's own interests:
(i) The employee's spouse;
(ii) The employee's minor child;
(iii) The employee's general partner;
(iv) An organization or entity which the employee serves as officer, director, trustee,
general partner or employee; and
(v) A person with whom the employee is negotiating for or has an arrangement
concerning prospective employment. (Employees who are seeking other employment
should refer to and comply with the standards in subpart F of this part).
Example 1: An employee of the Department of Education serves without
compensation on the board of directors of Kinder World, Inc., a nonprofit corporation
that engages in good works. Even though her personal financial interests will not be
affected, the employee must disqualify herself from participating in the review of a
grant application submitted by Kinder World. Award or denial of the grant will affect
the financial interests of Kinder World and its financial interests are imputed to her
as a member of its board of directors.
Example 2: The spouse of an employee of the Food and Drug Administration has
obtained a position with a well established biomedical research company. The
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company has developed an artificial limb for which it is seeking FDA approval and
the employee would ordinarily be asked to participate in the FDA's review and
approval process. The spouse is a salaried employee of the company and has no direct
ownership interest in the company. Nor does she have an indirect ownership interest,
as would be the case, for example, if she were participating in a pension plan that
held stock in the company. Her position with the company is such that the granting
or withholding of FDA approval will not have a direct and predictable effect on her
salary or on her continued employment with the company. Since the FDA approval
process will not affect his spouse's financial interests, the employee is not disqualified
under $2635.402 from participating in that process. Nevertheless, the financial
interests of the spouse's employer may be disqualifying under the impartiality
principle, as implemented at $2635.502.
(3) Particular matter. The term particular matter encompasses only matters that
involve deliberation, decision, or action that is focused upon the interests of specific
persons, or a discrete and identifiable class of persons. Such a matter is covered by
this subpart even if it does not involve formal parties and may include governmental
action such as legislation or policy-making that is narrowly focused on the interests
of such a discrete and identifiable class of persons. The term particular matter,
however, does not extend to the consideration or adoption of broad policy options that
are directed to the interests of a large and diverse group of persons. The particular
matters covered by this subpart include a judicial or other proceeding, application,
request for a ruling or other determination, contract, claim, controversy, charge,
accusation or arrest.
Example 1: The Internal Revenue Service's amendment of its regulations to change
the manner in which depreciation is calculated is not a particular matter, nor is the
Social Security Administration's consideration of changes to its appeal procedures for
disability claimants.
Example 2: Consideration by the Interstate Commerce Commission of regulations
establishing safety standards for trucks on interstate highways involves a particular
matter.
(4) Personal and substantial. To participate personally means to participate directly.
It includes the direct and active supervision of the participation of a subordinate in
the matter. To participate substantially means that the employee's involvement is of
significance to the matter. Participation may be substantial even though it is not
determinative of the outcome of a particular matter. However, it requires more than
official responsibility, knowledge, perfunctory involvement, or involvement on an
administrative or peripheral issue. A finding of substantiality should be based not
only on the effort devoted to a matter, but also on the importance of the effort. While
a series of peripheral involvements may be insubstantial, the single act of approving
or participating in a critical step may be substantial. Personal and substantial
-33-
participation may occur when, for example, an employee participates through
decision, approval, disapproval, recommendation, investigation or the rendering of
advice in a particular matter.
(c) Disqualification. Unless the employee is authorized to participate in the particular
matter by virtue of a waiver described in paragraph (d) of this section or because the
interest has been divested in accordance with paragraph (e) of this section, an
employee shall disqualify himself from participating in a particular matter in which,
to his knowledge, he or a person whose interests are imputed to him has a financial
interest, if the particular matter will have a direct and predictable effect on that
interest. Disqualification is accomplished by not participating in the particular
matter.
(1) Notification. An employee who becomes aware of the need to disqualify himself
from participation in a particular matter to which he has been assigned should notify
the person responsible for his assignment. An employee who is responsible for his
own assignment should take whatever steps are necessary to ensure that he does not
participate in the matter from which he is disqualified. Appropriate oral or written
notification of the employee's disqualification may be made to coworkers by the
employee or a supervisor to ensure that the employee is not involved in a matter from
which he is disqualified.
(2) Documentation. An employee need not file a written disqualification statement
unless he is required by part 2634 of this chapter to file written evidence of
compliance with an ethics agreement with the Office of Government Ethics or is
asked by an agency ethics official or the person responsible for his assignment to file
a written disqualification statement. However, an employee may elect to create a
record of his actions by providing written notice to a supervisor or other appropriate
official.
Example 1: An Assistant Secretary of the Department of the Interior owns
recreational property that borders on land which is being considered for annexation
to a national park. Annexation would directly and predictably increase the value of
her vacation property and, thus, she is disqualified from participating in any way in
the Department's deliberations or decisions regarding the annexation. Because she
is responsible for determining which matters she will work on, she may accomplish
her disqualification merely by ensuring that she does not participate in the matter.
Because of the level of her position, however, the Assistant Secretary might be wise
to establish a record that she has acted properly by providing a written
disqualification statement to an official superior and by providing written notification
of the disqualification to subordinates to ensure that they do not raise or discuss with
her any issues related to the annexation.
-34-
(d) Waiver of disqualification. An employee who would otherwise be disqualified by
18 U.S.C. 208(a) may be permitted to participate in a particular matter where the
otherwise disqualifying financial interest is the subject of a regulatory or individual
waiver described in this paragraph, or results from certain Indian birthrights as
described in 18 U.S.C. 208(b)(4).
(1) Regulatory waivers. Under 18 U.S.C. 208(b)(2), regulatory waivers of general
applicability may be issued by the Office of Government Ethics based on its
determination that particular interests are too remote or too inconsequential to affect
the integrity of the services of the employees to whom the waivers apply. Pending
issuance of superseding regulatory waivers under this authority, agency regulatory
waivers issued under 18 U.S.C. 208(b)(2) as in effect prior to November 30, 1989
continue to apply.
(2) Individual waivers. An individual waiver enabling the employee to participate in
one or more particular matters may be issued under 18 U.S.C. 208(b)(1) if, in advance
of the employee's participation:
(i) The employee:
(A) Advises the Government official responsible for the employee's appointment (or
other Government official to whom authority to issue such a waiver for the employee
has been delegated) about the nature and circumstances of the particular matter or
matters; and
(B) Makes full disclosure to such official of the nature and extent of the disqualifying
financial interest; and
(ii) Such official determines, in writing, that the employee's financial interest in the
particular matter or matters is not so substantial as to be deemed likely to affect the
integrity of the services which the Government may expect from such employee.
(3) Federal advisory committee member waivers. An individual waiver may be issued
under 18 U.S.C. 208(b)(3) to a special Government employee serving on, or under
consideration for appointment to, an advisory committee within the meaning of the
Federal Advisory Committee Act if the Government official responsible for the
employee's appointment (or other Government official to whom authority to issue
such a waiver for the employee has been delegated):
(i) Reviews the financial disclosure report filed by the special Government employee
pursuant to the Ethics in Government Act of 1978; and
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(ii) Certifies in writing that the need for the individual's services outweighs the
potential for a conflict of interest created by the otherwise disqualifying financial
interest.
(4) Consultation and notification regarding waivers. When practicable, an official is
required to consult formally or informally with the Office of Government Ethics prior
to granting a waiver referred to in paragraph (d)(2) or (3) of this section. A copy of
each such waiver is to be forwarded to the Director of the Office of Government
Ethics.
(e) Divestiture of a disqualifying financial interest. Upon sale or other divestiture of
the asset or other interest that causes his disqualification from participation in a
particular matter, 18 U.S.C. 208(a) and paragraph (c) of this section will no longer
prohibit the employee's participation in the matter.
(1) Voluntary divestiture. An employee who would otherwise be disqualified from
participation in a particular matter may voluntarily sell or otherwise divest himself
of the interest that causes the disqualification.
(2) Directed divestiture. An employee may be required to sell or otherwise divest
himself of the disqualifying financial interest if his continued holding of that interest
is prohibited by statute or by agency supplemental regulation issued in accordance
with §2635.403(a), or if the agency determines in accordance with §2635.403(b) that
a substantial conflict exists between the financial interest and the employee's duties
or accomplishment of the agency's mission.
(3) Eligibility for special tax treatment. An employee who is directed to divest an
interest may be eligible to defer the tax consequences of divestiture under subpart J
of part 2634 of this chapter. An employee who divests before obtaining a certificate
of divestiture will not be eligible for this special tax treatment.
(f) Official duties that give rise to potential conflicts. Where an employee's official
duties create a substantial likelihood that the employee may be assigned to a
particular matter from which he is disqualified, the employee should advise his
supervisor or other person responsible for his assignments of that potential so that
conflicting assignments can be avoided, consistent with the agency's needs.
$2635.403
Prohibited financial interests.
An employee shall not acquire or hold any financial interest that he is prohibited
from acquiring or holding by statute, by agency regulation issued in accordance with
-36-
paragraph (a) of this section or by reason of an agency determination of substantial
conflict under paragraph (b) of this section.
Note: There is no statute of Governmentwide applicability prohibiting employees from
holding or acquiring any financial interest. Statutory restrictions, if any, are
contained in agency statutes which, in some cases, may be implemented by agency
regulations issued independent of this part.
(a) Agency regulation prohibiting certain financial interests. An agency may, by
supplemental agency regulation, prohibit or restrict the acquisition or holding of a
financial interest or a class of financial interests by agency employees, or any
category of agency employees, and the spouses and minor children of those employees,
based on the agency's determination that the acquisition or holding of such financial
interests would cause a reasonable person to question the impartiality and objectivity
with which agency programs are administered. Where the agency restricts or
prohibits the holding of certain financial interests by its employees' spouses or minor
children, any such prohibition or restriction shall be based on a determination that
there is a direct and appropriate nexus between the prohibition or restriction as
applied to spouses and minor children and the efficiency of the service.
Note: Any prohibition on acquiring or holding a specific financial interest contained
in an agency regulation, instruction or other issuance in effect prior to the effective
date of this part shall, for employees of that agency, constitute a prohibited financial
interest for purposes of this paragraph for one year after the effective date of this
part or until issuance of an agency supplemental regulation, whichever occurs first.
(b) Agency determination of substantial conflict. An agency may prohibit or restrict
an individual employee from acquiring or holding a financial interest or a class of
financial interests based upon the agency designee's determination that the holding
of such interest or interests will:
(1) Require the employee's disqualification from matters so central or critical to the
performance of his official duties that the employee's ability to perform the duties of
his position would be materially impaired; or
(2) Adversely affect the efficient accomplishment of the agency's mission because
another employee cannot be readily assigned to perform work from which the
employee would be disqualified by reason of the financial interest.
Example 1: An Air Force employee who owns stock in a major aircraft engine
manufacturer is being considered for promotion to a position that involves
responsibility for development of a new fighter airplane. If the agency determined
that engineering and other decisions about the Air Force's requirements for the
fighter would directly and predictably affect his financial interests, the employee
-37-
could not, by virtue of 18 U.S.C. 208(a), perform these significant duties of the
position while retaining his stock in the company. The agency can require the
employee to sell his stock as a condition of being selected for the position rather than
allowing him to disqualify himself in particular matters.
(c) Definition of financial interest. For purposes of this section:
(1) Except as provided in paragraph (c)(2) of this section, the term financial interest
is limited to financial interests that are owned by the employee or by the employee's
spouse or minor children. However, the term is not limited to only those financial
interests that would be disqualifying under 18 U.S.C. 208(a) and $2635.402. The term
includes any current or contingent ownership, equity, or security interest in real or
personal property or a business and may include an indebtedness or compensated
employment relationship. It thus includes, for example, interests in the nature of
stocks, bonds, partnership interests, fee and leasehold interests, mineral and other
property rights, deeds of trust, and liens, and extends to any right to purchase or
acquire any such interest, such as a stock option or commodity future. It does not
include a future interest created by someone other than the employee, his spouse, or
dependent child or any right as a beneficiary of an estate that has not been settled.
Example 1: A regulatory agency has concluded that ownership by its employees of
stock in entities regulated by the agency would significantly diminish public
confidence in the agency's performance of its regulatory functions and thereby
interfere with the accomplishment of its mission. In its supplemental agency
regulations, the agency may prohibit its employees from acquiring or continuing to
hold stock in regulated entities.
Example 2: An agency that insures bank deposits may, by supplemental agency
regulation, prohibit its employees who are bank examiners from obtaining loans from
banks they examine. Examination of a member bank could have no effect on an
employee's fixed obligation to repay a loan from that bank and, thus, would not affect
an employee's financial interests so as to require disqualification under $2635.402.
Nevertheless, a loan from a member bank is a discrete financial interest within the
meaning of §2635.403(c) that may, when appropriate, be prohibited by supplemental
agency regulation.
(2) The term financial interest includes service, with or without compensation, as an
officer, director, trustee, general partner or employee of any person, including a
nonprofit entity, whose financial interests are imputed to the employee under
§2635.402(b)(2)(iii) or (iv).
Example 1. The Foundation for the Preservation of Wild Horses maintains herds of
horses that graze on public and private lands. Because its costs are affected by
Federal policies regarding grazing permits, the Foundation routinely comments on
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all proposed rules governing use of Federal grasslands issued by the Bureau of Land
Management. BLM may require an employee to resign his uncompensated position
as Vice President of the Foundation as a condition of his promotion to a policy-level
position within the Bureau rather than allowing him to rely on disqualification in
particular cases.
(d) Reasonable period to divest or terminate. Whenever an agency directs divestiture
of a financial interest under paragraph (a) or (b) of this section, the employee shall
be given a reasonable period of time, considering the nature of his particular duties
and the nature and marketability of the interest, within which to comply with the
agency's direction. Except in cases of unusual hardship, as determined by the agency,
a reasonable period shall not exceed 90 days from the date divestiture is first
directed. However, as long as the employee continues to hold the financial interest,
he remains subject to any restrictions imposed by this subpart.
(e) Eligibility for special tax treatment. An employee required to sell or otherwise
divest a financial interest may be eligible to defer the tax consequences of divestiture
under subpart J of part 2634 of this chapter.
Subpart E -- Impartiality in Performing Official Duties
$2635.501
Overview.
(a) This subpart contains two provisions intended to ensure that an employee takes
appropriate steps to avoid an appearance of loss of impartiality in the performance
of his official duties. Under $2635.502, unless he receives prior authorization, an
employee should not participate in a particular matter involving specific parties
which he knows is likely to affect the financial interests of a member of his
household, or in which he knows a person with whom he has a covered relationship
is or represents a party, if he determines that a reasonable person with knowledge
of the relevant facts would question his impartiality in the matter. An employee who
is concerned that other circumstances would raise a question regarding his
impartiality should use the process described in $2635.502 to determine whether he
should or should not participate in a particular matter.
(b) Under $2635.503, an employee who has received an extraordinary severance or
other payment from a former employer prior to entering Government service is
subject, in the absence of a waiver, to a two-year period of disqualification from
participation in particular matters in which that former employer is or represents a
party.
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Note: Questions regarding impartiality necessarily arise when an employee's official
duties impact upon the employee's own financial interests or those of certain other
persons, such as the employee's spouse or minor child. An employee is prohibited by
criminal statute, 18 U.S.C. 208(a), from participating personally and substantially in
an official capacity in any particular matter in which, to his knowledge, he, his
spouse, general partner or minor child has a financial interest, if the particular
matter will have a direct and predictable effect on that interest. The statutory
prohibition also extends to an employee's participation in a particular matter in
which, to his knowledge, an organization in which the employee is serving as officer,
director, trustee, general partner or employee, or with whom he is negotiating or has
an arrangement concerning prospective employment has a financial interest. Where
the employee's participation in a particular matter would affect any one of these
financial interests, the standards set forth in subparts D or F of this part apply and
only a statutory waiver, as described respectively in §§2635.402(d) and 2635.605(a),
will enable the employee to participate in that matter. The authorization procedures
in §2635.502(d) may not be used to authorize an employee's participation in any such
matter. Where the employee complies with all terms of the waiver, the granting of
a statutory waiver will be deemed to constitute a determination that the interest of
the Government in the employee's participation outweighs the concern that a
reasonable person may question the integrity of agency programs and operations.
$2635.502
Personal and business relationships.
(a) Consideration of appearances by the employee. Where an employee knows that a
particular matter involving specific parties is likely to have a direct and predictable
effect on the financial interest of a member of his household, or knows that a person
with whom he has a covered relationship is or represents a party to such matter, and
where the employee determines that the circumstances would cause a reasonable
person with knowledge of the relevant facts to question his impartiality in the
matter, the employee should not participate in the matter unless he has informed the
agency designee of the appearance problem and received authorization from the
agency designee in accordance with paragraph (d) of this section.
(1) In considering whether a relationship would cause a reasonable person to question
his impartiality, an employee may seek the assistance of his supervisor, an agency
ethics official or the agency designee.
(2) An employee who is concerned that circumstances other than those specifically
described in this section would raise a question regarding his impartiality should use
the process described in this section to determine whether he should or should not
participate in a particular matter.
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(b) Definitions. For purposes of this section:
(1) An employee has a covered relationship with:
(i) A person, other than a prospective employer described in §2635.603(c), with whom
the employee has or seeks a business, contractual or other financial relationship that
involves other than a routine consumer transaction;
Note: An employee who is seeking employment within the meaning of $2635.603 shall
comply with subpart F of this part rather than with this section.
(ii) A person who is a member of the employee's household, or who is a relative with
whom the employee has a close personal relationship;
(iii) A person for whom the employee's spouse, parent or dependent child is, to the
employee's knowledge, serving or seeking to serve as an officer, director, trustee,
general partner, agent, attorney, consultant, contractor or employee;
(iv) Any person for whom the employee has, within the last year, served as officer,
director, trustee, general partner, agent, attorney, consultant, contractor or employee;
or
(v) An organization, other than a political party described in 26 U.S.C. 527(e), in
which the employee is an active participant. Participation is active if, for example,
it involves service as an official of the organization or in a capacity similar to that
of a committee or subcommittee chairperson or spokesperson, or participation in
directing the activities of the organization. In other cases, significant time devoted
to promoting specific programs of the organization, including coordination of
fundraising efforts, is an indication of active participation. Payment of dues or the
donation or solicitation of financial support does not, in itself, constitute active
participation.
Note: Nothing in this section shall be construed to suggest that an employee should
not participate in a matter because of his political, religious or moral views.
(2) Direct and predictable effect has the meaning set forth in §2635.402(b)(1).
(3) Particular matter involving specific parties has the meaning set forth in
§2637.102(a)(7) of this chapter.
Example 1: An employee of the General Services Administration has made an offer
to purchase a restaurant owned by a local developer. The developer has submitted an
offer in response to a GSA solicitation for lease of office space. Under the
circumstances, she would be correct in concluding that a reasonable person would be
-41-
likely to question her impartiality if she were to participate in evaluating that
developer's or its competitor's lease proposal.
Example 2: An employee of the Department of Labor is providing technical assistance
in drafting occupational safety and health legislation that will affect all employers of
five or more persons. His wife is employed as an administrative assistant by a large
corporation that will incur additional costs if the proposed legislation is enacted.
Because the legislation is not a particular matter involving specific parties, the
employee may continue to work on the legislation and need not be concerned that his
wife's employment with an affected corporation would raise a question concerning his
impartiality.
Example 3: An employee of the Defense Logistics Agency who has responsibilities for
testing avionics being produced by an Air Force contractor has just learned that his
sister-in-law has accepted employment as an engineer with the contractor's parent
corporation. Where the parent corporation is a conglomerate, the employee could
reasonably conclude that, under the circumstances, a reasonable person would not be
likely to question his impartiality if he were to continue to perform his test and
evaluation responsibilities.
Example 4: An engineer has just resigned from her position as vice president of an
electronics company in order to accept employment with the Federal Aviation
Administration in a position involving procurement responsibilities. Although the
employee did not receive an extraordinary payment in connection with her
resignation and has severed all financial ties with the firm, under the circumstances
she would be correct in concluding that her former service as an officer of the
company would be likely to cause a reasonable person to question her impartiality if
she were to participate in the administration of a DOT contract for which the firm
is a first-tier subcontractor.
Example 5: An employee of the Internal Revenue Service is a member of a private
organization whose purpose is to restore a Victorian-era railroad station and she
chairs its annual fundraising drive. Under the circumstances, the employee would be
correct in concluding that her active membership in the organization would be likely
to cause a reasonable person to question her impartiality if she were to participate
in an IRS determination regarding the tax-exempt status of the organization.
(c) Determination by agency designee. Where he has information concerning a
potential appearance problem arising from the financial interest of a member of the
employee's household in a particular matter involving specific parties, or from the
role in such matter of a person with whom the employee has a covered relationship,
the agency designee may make an independent determination as to whether a
reasonable person with knowledge of the relevant facts would be likely to question
the employee's impartiality in the matter. Ordinarily, the agency designee's
-42-
determination will be initiated by information provided by the employee pursuant to
paragraph (a) of this section. However, at any time, including after the employee has
disqualified himself from participation in a matter pursuant to paragraph (e) of this
section, the agency designee may make this determination on his own initiative or
when requested by the employee's supervisor or any other person responsible for the
employee's assignment.
(1) If the agency designee determines that the employee's impartiality is likely to be
questioned, he shall then determine, in accordance with paragraph (d) of this section,
whether the employee should be authorized to participate in the matter. Where the
agency designee determines that the employee's participation should not be
authorized, the employee will be disqualified from participation in the matter in
accordance with paragraph (e) of this section.
(2) If the agency designee determines that the employee's impartiality is not likely
to be questioned, he may advise the employee, including an employee who has
reached a contrary conclusion under paragraph (a) of this section, that the employee's
participation in the matter would be proper.
(d) Authorization by agency designee. Where an employee's participation in a
particular matter involving specific parties would not violate 18 U.S.C. 208(a), but
would raise a question in the mind of a reasonable person about his impartiality, the
agency designee may authorize the employee to participate in the matter based on
a determination, made in light of all relevant circumstances, that the interest of the
Government in the employee's participation outweighs the concern that a reasonable
person may question the integrity of the agency's programs and operations. Factors
which may be taken into consideration include:
(1) The nature of the relationship involved;
(2) The effect that resolution of the matter would have upon the financial interests
of the person involved in the relationship;
(3) The nature and importance of the employee's role in the matter, including the
extent to which the employee is called upon to exercise discretion in the matter;
(4) The sensitivity of the matter;
(5) The difficulty of reassigning the matter to another employee; and
(6) Adjustments that may be made in the employee's duties that would reduce or
eliminate the likelihood that a reasonable person would question the employee's
impartiality.
-43-
Authorization by the agency designee shall be documented in writing at the agency
designee's discretion or when requested by the employee. An employee who has been
authorized to participate in a particular matter involving specific parties may not
thereafter disqualify himself from participation in the matter on the basis of an
appearance problem involving the same circumstances that have been considered by
the agency designee.
Example 1: The Deputy Director of Personnel for the Department of the Treasury and
an attorney with the Department's Office of General Counsel are general partners in
a real estate partnership. The Deputy Director advises his supervisor, the Director
of Personnel, of the relationship upon being assigned to a selection panel for a
position for which his partner has applied. If selected, the partner would receive a
substantial increase in salary. The agency designee cannot authorize the Deputy
Director to participate on the panel under the authority of this section since the
Deputy Director is prohibited by criminal statute, 18 U.S.C. 208(a), from participating
in a particular matter affecting the financial interest of a person who is his general
partner. See $2635.402.
Example 2: A new employee of the Securities and Exchange Commission is assigned
to an investigation of insider trading by the brokerage house where she had recently
been employed. Because of the sensitivity of the investigation, the agency designee
may be unable to conclude that the Government's interest in the employee's
participation in the investigation outweighs the concern that a reasonable person may
question the integrity of the investigation, even though the employee has severed all
financial ties with the company. Based on consideration of all relevant circumstances,
the agency designee might determine, however, that it is in the interest of the
Government for the employee to pass on a routine filing by the particular brokerage
house.
Example 3: An Internal Revenue Service employee involved in a long and complex tax
audit is advised by her son that he has just accepted an entry-level management
position with a corporation whose taxes are the subject of the audit. Because the
audit is essentially complete and because the employee is the only one with an
intimate knowledge of the case, the agency designee might determine, after
considering all relevant circumstances, that it is in the Government's interest for the
employee to complete the audit, which is subject to additional levels of review.
(e) Disqualification. Unless the employee is authorized to participate in the matter
under paragraph (d) of this section, an employee shall not participate in a particular
matter involving specific parties when he or the agency designee has concluded, in
accordance with paragraph (a) or (c) of this section, that the financial interest of a
member of the employee's household, or the role of a person with whom he has a
covered relationship, is likely to raise a question in the mind of a reasonable person
-44-
about his impartiality. Disqualification is accomplished by not participating in the
matter.
(1) Notification. An employee who becomes aware of the need to disqualify himself
from participation in a particular matter involving specific parties to which he has
been assigned should notify the person responsible for his assignment. An employee
who is responsible for his own assignment should take whatever steps are necessary
to ensure that he does not participate in the matter from which he is disqualified.
Appropriate oral or written notification of the employee's disqualification may be
made to coworkers by the employee or a supervisor to ensure that the employee is not
involved in a particular matter involving specific parties from which he is
disqualified.
(2) Documentation. An employee need not file a written disqualification statement
unless he is required by part 2634 of this chapter to file written evidence of
compliance with an ethics agreement with the Office of Government Ethics or is
specifically asked by an agency ethics official or the person responsible for his
assignment to file a written disqualification statement. However, an employee may
elect to create a record of his actions by providing written notice to a supervisor or
other appropriate official.
(f) Relevant considerations. An employee's reputation for honesty and integrity is not
a relevant consideration for purposes of any determination required by this section.
$2635.503
Extraordinary payments from former employers.
(a) Disqualification requirement. Except as provided in paragraph (c) of this section,
an employee shall be disqualified for two years from participating in any particular
matter in which a former employer is a party or represents a party if he received an
extraordinary payment from that person prior to entering Government service. The
two-year period of disqualification begins to run on the date that the extraordinary
payment is received.
Example 1: Following his confirmation hearings and one month before his scheduled
swearing in, a nominee to the position of Assistant Secretary of a department
received an extraordinary payment from his employer. For one year and 11 months
after his swearing in, the Assistant Secretary may not participate in any particular
matter to which his former employer is a party.
Example 2: An employee received an extraordinary payment from her former
employer, a coal mine operator, prior to entering on duty with the Department of the
Interior. For two years thereafter, she may not participate in a determination
-45-
regarding her former employer's obligation to reclaim a particular mining site,
because her former employer is a party to the matter. However, she may help to draft
reclamation legislation affecting all coal mining operations because this legislation
does not involve any parties.
(b) Definitions. For purposes of this section, the following definitions shall apply:
(1) Extraordinary payment means any item, including cash or an investment interest,
with a value in excess of $10,000, which is paid:
(i) On the basis of a determination made after it became known to the former
employer that the individual was being considered for or had accepted a Government
position; and
(ii) Other than pursuant to the former employer's established compensation,
partnership, or benefits program. A compensation, partnership, or benefits program
will be deemed an established program if it is contained in bylaws, a contract or other
written form, or if there is a history of similar payments made to others not entering
into Federal service.
Example 1: The vice president of a small corporation is nominated to be an
ambassador. In recognition of his service to the corporation, the board of directors
votes to pay him $50,000 upon his confirmation in addition to the regular severance
payment provided for by the corporate bylaws. The regular severance payment is not
an extraordinary payment. The gratuitous payment of $50,000 is an extraordinary
payment, since the corporation had not made similar payments to other departing
officers.
(2) Former employer includes any person which the employee served as an officer,
director, trustee, general partner, agent, attorney, consultant, contractor or employee.
(c) Waiver of disqualification. The disqualification requirement of this section may be
waived based on a finding that the amount of the payment was not so substantial as
to cause a reasonable person to question the employee's ability to act impartially in
a matter in which the former employer is or represents a party. The waiver shall be
in writing and may be given only by the head of the agency or, where the recipient
of the payment is the head of the agency, by the President or his designee. Waiver
authority may be delegated by agency heads to any person who has been delegated
authority to issue individual waivers under 18 U.S.C. 208(b) for the employee who is
the recipient of the extraordinary payment.
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Subpart F -- Seeking Other Employment
$2635.601
Overview.
This subpart contains a disqualification requirement that applies to employees when
seeking employment with persons who otherwise would be affected by the
performance or nonperformance of the employees' official duties. Specifically, it
addresses the requirement of 18 U.S.C. 208(a) that an employee disqualify himself
from participation in any particular matter that will have a direct and predictable
effect on the financial interests of a person "with whom he is negotiating or has any
arrangement concerning prospective employment." Beyond this statutory
requirement, it also addresses the issues of lack of impartiality that require
disqualification from particular matters affecting the financial interests of a
prospective employer when an employee's actions in seeking employment fall short
of actual employment negotiations.
$2635.602
Applicability and related considerations.
To ensure that he does not violate 18 U.S.C. 208(a) or the principles of ethical
conduct contained in §2635.101(b), an employee who is seeking employment or who
has an arrangement concerning prospective employment shall comply with the
applicable disqualification requirements of $$2635.604 and 2635.606 if the employee's
official duties would affect the financial interests of a prospective employer or of a
person with whom he has an arrangement concerning prospective employment.
Compliance with this subpart also will ensure that the employee does not violate
subpart D or E of this part.
Note: An employee who is seeking employment with a person whose financial
interests are not affected by the performance or nonperformance of his official duties
has no obligation under this subpart. An employee may, however, be subject to other
statutes which impose restrictions on employment contacts or discussions, such as 41
U.S.C. 423(b)(1), applicable to procurement officials, and 10 U.S.C. 2397a, applicable
to certain employees of the Department of Defense.
(a) Related employment restrictions-(1) Outside employment while a Federal
employee. An employee who is contemplating outside employment to be undertaken
concurrently with his Federal employment must abide by any limitations applicable
to his outside activities under subparts G and H of this part. He must also comply
with any disqualification requirement that may be applicable under subpart D or E
of this part as a result of his outside employment activities.
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(2) Post-employment restrictions. An employee who is contemplating employment to
be undertaken following the termination of his Federal employment should consult
an agency ethics official to obtain advice regarding any post-employment restrictions
that may be applicable. Regulations implementing the Governmentwide
post-employment statute, 18 U.S.C. 207, are contained in parts 2637 and 2641 of this
chapter. Employees are cautioned that they may be subject to additional statutory
restrictions on their post-employment activities, such as 41 U.S.C. 423(f) applicable
to procurement officials, 10 U.S.C. 2397b applicable to certain Department of Defense
personnel and special statutes applicable to certain retired officers.
(b) Interview trips and entertainment. Where a prospective employer who is a
prohibited source as defined in §2635.203(d) offers to reimburse an employee's travel
expenses, or provide other reasonable amenities incident to employment discussions,
the employee may accept such amenities in accordance with §2635.204(e)(3).
$2635.603
Definitions.
For purposes of this subpart:
(a) Employment means any form of non-Federal employment or business relationship
involving the provision of personal services by the employee, whether to be
undertaken at the same time as or subsequent to Federal employment. It includes
but is not limited to personal services as an officer, director, employee, agent,
attorney, consultant, contractor, general partner or trustee.
Example 1: An employee of the Bureau of Indian Affairs who has announced her
intention to retire is approached by tribal representatives concerning a possible
consulting contract with the tribe. The independent contractual relationship the tribe
wishes to negotiate is employment for purposes of this subpart.
Example 2: An employee of the Department of Health and Human Services is invited
to a meeting with officials of a nonprofit corporation to discuss the possibility of his
serving as a member of the corporation's board of directors. Service, with or without
compensation, as a member of the board of directors constitutes employment for
purposes of this subpart.
(b) An employee is seeking employment once he has begun seeking employment
within the meaning of paragraph (b)(1) of this section and until he is no longer
seeking employment within the meaning of paragraph (b)(2) of this section.
(1) An employee has begun seeking employment if he has directly or indirectly:
-48-
(i) Engaged in negotiations for employment with any person. For these purposes, as
for 18 U.S.C. 208(a), the term negotiations means discussion or communication with
another person, or such person's agent or intermediary, mutually conducted with a
view toward reaching an agreement regarding possible employment with that person.
The term is not limited to discussions of specific terms and conditions of employment
in a specific position;
(ii) Made an unsolicited communication to any person, or such person's agent or
intermediary, regarding possible employment with that person. However, the
employee has not begun seeking employment if that communication was:
(A) For the sole purpose of requesting a job application; or
(B) For the purpose of submitting a resume or other employment proposal to a person
affected by the performance or nonperformance of the employee's duties only as part
of an industry or other discrete class. The employee will be considered to have begun
seeking employment upon receipt of any response indicating an interest in
employment discussions; or
(iii) Made a response other than rejection to an unsolicited communication from any
person, or such person's agent or intermediary, regarding possible employment with
that person.
(2) An employee is no longer seeking employment when:
(i) The employee or the prospective employer rejects the possibility of employment
and all discussions of possible employment have terminated; or
(ii) Two months have transpired after the employee's dispatch of an unsolicited
resume or employment proposal, provided the employee has received no indication of
interest in employment discussions from the prospective employer.
(3) For purposes of this definition, a response that defers discussions until the
foreseeable future does not constitute rejection of an unsolicited employment overture,
proposal, or resume nor rejection of a prospective employment possibility.
Example 1: An employee of the Health Care Financing Administration is
complimented on her work by an official of a State Health Department who asks her
to call if she is ever interested in leaving Federal service. The employee explains to
the State official that she is very happy with her job at HCFA and is not interested
in another job. She thanks him for his compliment regarding her work and adds that
she'll remember his interest if she ever decides to leave the Government. The
employee has rejected the unsolicited employment overture and has not begun
seeking employment.
-49-
Example 2: The employee in the preceding example responds by stating that she
cannot discuss future employment while she is working on a project affecting the
State's health care funding but would like to discuss employment with the State
when the project is completed. Because the employee has merely deferred
employment discussions until the foreseeable future, she has begun seeking
employment with the State Health Department.
Example 3: An employee of the Defense Contract Audit Agency is auditing the
overhead accounts of an Army contractor. While at the contractor's headquarters, the
head of the contractor's accounting division tells the employee that his division is
thinking about hiring another accountant and asks whether the employee might be
interested in leaving DCAA. The DCAA employee says he is interested in knowing
what kind of work would be involved. They discuss the duties of the position the
accounting division would like to fill and the DCAA employee's qualifications for the
position. They do not discuss salary. The head of the division explains that he has not
yet received authorization to fill the particular position and will get back to the
employee when he obtains the necessary approval for additional staffing. The
employee and the contractor's official have engaged in negotiations regarding possible
employment. The employee has begun seeking employment with the Army contractor.
Example 4: An employee of the Occupational Safety and Health Administration
helping to draft safety standards applicable to the textile industry has mailed his
resume to 25 textile manufacturers. He has not begun seeking employment with any
of the twenty-five. If he receives a response from one of the resume recipients
indicating an interest in employment discussions, the employee will have begun
seeking employment with the respondent at that time.
Example 5: A special Government employee of the Federal Deposit Insurance
Corporation is serving on an advisory committee formed for the purpose of reviewing
rules applicable to all member banks. She mails an unsolicited letter to a member
bank offering her services as a contract consultant. She has not begun seeking
employment with the bank until she receives some response indicating an interest
in discussing her employment proposal. A letter merely acknowledging receipt of the
proposal is not an indication of interest in employment discussions.
Example 6: A geologist employed by the U.S. Geological Survey has been working as
a member of a team preparing the Government's case in an action brought by the
Government against six oil companies. The geologist sends her resume to an oil
company that is a named defendant in the action. The geologist has begun seeking
employment with that oil company and will be seeking employment for two months
from the date the resume was mailed. However, if she withdraws her application or
is notified within the two-month period that her resume has been rejected, she will
no longer be seeking employment with the oil company as of the date she makes such
withdrawal or receives such notification.
-50-
(c) Prospective employer means any person with whom the employee is seeking
employment. Where contacts that constitute seeking employment are made by or with
an agent or other intermediary, the term prospective employer includes:
(1) A person who uses that agent or other intermediary for the purpose of seeking to
establish an employment relationship with the employee if the agent identifies the
prospective employer to the employee; and
(2) A person contacted by the employee's agent or other intermediary for the purpose
of seeking to establish an employment relationship if the agent identifies the
prospective employer to the employee.
Example 1: An employee of the Federal Aviation Administration has overall
responsibility for airport safety inspections in a three-state area. She has retained an
employment search firm to help her find another job. The search firm has just
reported to the FAA employee that it has given her resume to and had promising
discussions with two airport authorities within her jurisdiction. Even though the
employee has not personally had employment discussions with either, each airport
authority is her prospective employer. She began seeking employment with each upon
learning its identity and that it has been given her resume.
(d) Direct and predictable effect and particular matter have the respective meanings
set forth in §2635.402(b) (1) and (3).
$2635.604
Disqualification while seeking employment.
(a) Obligation to disqualify. Unless the employee's participation is authorized in
accordance with $2635.605, the employee shall not participate in a particular matter
that, to his knowledge, has a direct and predictable effect on the financial interests
of a prospective employer with whom he is seeking employment within the meaning
of §2635.603(b). Disqualification is accomplished by not participating in the particular
matter.
(b) Notification. An employee who becomes aware of the need to disqualify himself
from participation in a particular matter to which he has been assigned should notify
the person responsible for his assignment. An employee who is responsible for his
own assignment should take whatever steps are necessary to ensure that he does not
participate in the matter from which he is disqualified. Appropriate oral or written
notification of the employee's disqualification may be made to coworkers by the
employee or a supervisor to ensure that the employee is not involved in a matter from
which he is disqualified.
-51-
(c) Documentation. An employee need not file a written disqualification statement
unless he is required by part 2634 of this chapter to file written evidence of
compliance with an ethics agreement with the Office of Government Ethics or is
specifically asked by an agency ethics official or the person responsible for his
assignment to file a written disqualification statement. However, an employee may
elect to create a record of his actions by providing written notice to a supervisor or
other appropriate official.
Example 1: An employee of the Department of Veterans Affairs is participating in the
audit of a contract for laboratory support services. Before sending his resume to a lab
which is a subcontractor under the VA contract, the employee should disqualify
himself from participation in the audit. Since he cannot withdraw from participation
in the contract audit without the approval of his supervisor, he should disclose his
intentions to his supervisor in order that appropriate adjustments in his work
assignments can be made.
Example 2: An employee of the Food and Drug Administration is contacted in writing
by a pharmaceutical company concerning possible employment with the company. The
employee is involved in testing a drug for which the company is seeking FDA
approval. Before making a response that is not a rejection, the employee should
disqualify himself from further participation in the testing. Where he has authority
to ask his colleague to assume his testing responsibilities, he may accomplish his
disqualification by transferring the work to that coworker. However, to ensure that
his colleague and others with whom he had been working on the recommendations
do not seek his advice regarding testing or otherwise involve him in the matter, it
may be necessary for him to advise those individuals of his disqualification.
Example 3: The General Counsel of a regulatory agency wishes to engage in
discussions regarding possible employment as corporate counsel of a regulated entity.
Matters directly affecting the financial interests of the regulated entity are pending
within the Office of General Counsel, but the General Counsel will not be called upon
to act in any such matter because signature authority for that particular class of
matters has been delegated to an Assistant General Counsel. Because the General
Counsel is responsible for assigning work within the Office of General Counsel, he
can in fact accomplish his disqualification by simply avoiding any involvement in
matters affecting the regulated entity. However, because it is likely to be assumed
by others that the General Counsel is involved in all matters within the cognizance
of the Office of General Counsel, he would be wise to file a written disqualification
statement with the Commissioners of the regulatory agency and provide his
subordinates with written notification of his disqualification, or he may be specifically
asked by an agency ethics official or the Commissioners to file a written
disqualification statement.
-52-
Example 4: A scientist is employed by the National Science Foundation as a special
Government employee to serve on a panel that reviews grant applications to fund
research relating to deterioration of the ozone layer. She is discussing possible
employment as a member of the faculty of a university that several years earlier
received an NSF grant to study the effect of fluorocarbons, but has no grant
application pending. As long as the university does not submit a new application for
the panel's review, the employee would not have to take any action to effect
disqualification.
(d) Agency determination of substantial conflict. Where the agency determines that
the employee's action in seeking employment with a particular person will require his
disqualification from matters so central or critical to the performance of his official
duties that the employee's ability to perform the duties of his position would be
materially impaired, the agency may allow the employee to take annual leave or leave
without pay while seeking employment, or may take other appropriate administrative
action.
$2635.605
Waiver or authorization permitting participation while seeking employment.
(a) Waiver. Where, as defined in §2635.603(b)(1)(i), an employee is engaged in
discussions that constitute employment negotiations for purposes of 18 U.S.C. 208(a),
the employee may participate in a particular matter that has a direct and predictable
effect on the financial interests of a prospective employer only after receiving a
written waiver issued under the authority of 18 U.S.C. 208(b)(1) or (b)(3). These
waivers are described in §2635.402(d).
Example 1: An employee of the Department of Agriculture has had two telephone
conversations with an orange grower regarding possible employment. They have
discussed the employee's qualifications for a particular position with the grower, but
have not yet discussed salary or other specific terms of employment. The employee
is negotiating for employment within the meaning of 18 U.S.C. 208(a) and
§2635.603(b)(1)(i). In the absence of a written waiver issued under 18 U.S.C.
208(b)(1), she may not take official action on a complaint filed by a competitor
alleging that the grower has shipped oranges in violation of applicable quotas.
(b) Authorization by agency designee. Where an employee is seeking employment
within the meaning of §2635.603(b)(1) (ii) or (iii), a reasonable person would be likely
to question his impartiality if he were to participate in a particular matter that has
a direct and predictable effect on the financial interests of any such prospective
employer. The employee may participate in such matters only where the agency
designee has authorized his participation in accordance with the standards set forth
in §2635.502(d).
-53-
Example 1: Within the past month, an employee of the Education Department mailed
her resume to a university. She is thus seeking employment with the university
within the meaning of §2635.603(b)(1)(ii) even though she has received no reply. In
the absence of specific authorization by the agency designee in accordance with
§2635.502(d), she may not participate in an assignment to review a grant application
submitted by the university.
$2635.606
Disqualification based on an arrangement concerning prospective
employment or otherwise after negotiations.
(a) Employment or arrangement concerning employment. An employee shall be
disqualified from taking official action in a particular matter that has a direct and
predictable effect on the financial interests of the person by whom he is employed or
with whom he has an arrangement concerning future employment, unless authorized
to participate in the matter by a written waiver issued under the authority of 18
U.S.C. 208 (b)(1) or (b)(3). These waivers are described in §2635.402(d).
Example 1: A military officer has accepted a job with a defense contractor to begin
in six months, after his retirement from military service. During the period that he
remains with the Government, the officer may not participate in the administration
of a contract with that particular defense contractor unless he has received a written
waiver under the authority of 18 U.S.C. 208(b)(1).
Example 2: An accountant has just been offered a job with the Comptroller of the
Currency which involves a two-year limited appointment. Her private employer, a
large corporation, believes the job will enhance her skills and has agreed to give her
a two-year unpaid leave of absence at the end of which she has agreed to return to
work for the corporation. During the two-year period she is to be a COC employee,
the accountant will have an arrangement concerning future employment with the
corporation that will require her disqualification from participation in any particular
matter that will have a direct and predictable effect on the corporation's financial
interests.
(b) Offer rejected or not made. The agency designee for the purpose of §2635.502(c)
may, in an appropriate case, determine that an employee not covered by the
preceding paragraph who has sought but is no longer seeking employment
nevertheless shall be subject to a period of disqualification upon the conclusion of
employment negotiations. Any such determination shall be based on a consideration
of all the relevant factors, including those listed in §2635.502(d), and a determination
that the concern that a reasonable person may question the integrity of the agency's
decisionmaking process outweighs the Government's interest in the employee's
participation in the particular matter.
-54-
Example 1: An employee of the Securities and Exchange Commission was relieved of
responsibility for an investigation of a broker-dealer while seeking employment with
the law firm representing the broker-dealer in that matter. The firm did not offer her
the partnership position she sought. Even though she is no longer seeking
employment with the firm, she may continue to be disqualified from participating in
the investigation based on a determination by the agency designee that the concern
that a reasonable person might question whether, in view of the history of the
employment negotiations, she could act impartially in the matter outweighs the
Government's interest in her participation.
Subpart G -- Misuse of Position
$2635.701
Overview.
This subpart contains provisions relating to the proper use of official time and
authority, and of information and resources to which an employee has access because
of his Federal employment. This subpart sets forth standards relating to:
(a) Use of public office for private gain;
(b) Use of nonpublic information;
(c) Use of Government property; and
(d) Use of official time.
$2635.702
Use of public office for private gain.
An employee shall not use his public office for his own private gain, for the
endorsement of any product, service or enterprise, or for the private gain of friends,
relatives, or persons with whom the employee is affiliated in a nongovernmental
capacity, including nonprofit organizations of which the employee is an officer or
member, and persons with whom the employee has or seeks employment or business
relations. The specific prohibitions set forth in paragraphs (a) through (d) of this
section apply this general standard, but are not intended to be exclusive or to limit
the application of this section.
(a) Inducement or coercion of benefits. An employee shall not use or permit the use
of his Government position or title or any authority associated with his public office
-55-
in a manner that is intended to coerce or induce another person, including a
subordinate, to provide any benefit, financial or otherwise, to himself or to friends,
relatives, or persons with whom the employee is affiliated in a nongovernmental
capacity.
Example 1: Offering to pursue a relative's consumer complaint over a household
appliance, an employee of the Securities and Exchange Commission called the general
counsel of the manufacturer and, in the course of discussing the problem, stated that
he worked at the SEC and was responsible for reviewing the company's filings. The
employee violated the prohibition against use of public office for private gain by
invoking his official authority in an attempt to influence action to benefit his relative.
Example 2: An employee of the Department of Commerce was asked by a friend to
determine why his firm's export license had not yet been granted by another office
within the Department of Commerce. At a department-level staff meeting, the
employee raised as a matter for official inquiry the delay in approval of the particular
license and asked that the particular license be expedited. The official used her public
office in an attempt to benefit her friend and, in acting as her friend's agent for the
purpose of pursuing the export license with the Department of Commerce, may also
have violated 18 U.S.C. 205.
(b) Appearance of governmental sanction. Except as otherwise provided in this part,
an employee shall not use or permit the use of his Government position or title or any
authority associated with his public office in a manner that could reasonably be
construed to imply that his agency or the Government sanctions or endorses his
personal activities or those of another. When teaching, speaking, or writing in a
personal capacity, he may refer to his official title or position only as permitted by
§2635.807(b). He may sign a letter of recommendation using his official title only in
response to a request for an employment recommendation or character reference
based upon personal knowledge of the ability or character of an individual with whom
he has dealt in the course of Federal employment or whom he is recommending for
Federal employment.
Example 1: An employee of the Department of the Treasury who is asked to provide
a letter of recommendation for a former subordinate on his staff may provide the
recommendation using official stationery and may sign the letter using his official
title. If, however, the request is for the recommendation of a personal friend with
whom he has not dealt in the Government, the employee should not use official
stationery or sign the letter of recommendation using his official title, unless the
recommendation is for Federal employment. In writing the letter of recommendation
for his personal friend, it may be appropriate for the employee to refer to his official
position in the body of the letter.
-56-
(c) Endorsements. An employee shall not use or permit the use of his Government
position or title or any authority associated with his public office to endorse any
product, service or enterprise except:
(1) In furtherance of statutory authority to promote products, services or enterprises;
or
(2) As a result of documentation of compliance with agency requirements or standards
or as the result of recognition for achievement given under an agency program of
recognition for accomplishment in support of the agency's mission.
Example 1: A Commissioner of the Consumer Product Safety Commission may not
appear in a television commercial in which she endorses an electrical appliance
produced by her former employer, stating that it has been found by the CPSC to be
safe for residential use.
Example 2: A Foreign Commercial Service officer from the Department of Commerce
is asked by a United States telecommunications company to meet with
representatives of the Government of Spain, which is in the process of procuring
telecommunications services and equipment. The company is bidding against five
European companies and the statutory mission of the Department of Commerce
includes assisting the export activities of U.S. companies. As part of his official
duties, the Foreign Commercial Service officer may meet with Spanish officials and
explain the advantages of procurement from the United States company.
Example 3: The Administrator of the Environmental Protection Agency may sign a
letter to an oil company indicating that its refining operations are in compliance with
Federal air quality standards even though he knows that the company has routinely
displayed letters of this type in television commercials portraying it as a "trustee of
the environment for future generations."
Example 4: An Assistant Attorney General may not use his official title or refer to his
Government position in a book jacket endorsement of a novel about organized crime
written by an author whose work he admires. Nor may he do SO in a book review
published in a newspaper.
(d) Performance of official duties affecting a private interest. To ensure that the
performance of his official duties does not give rise to an appearance of use of public
office for private gain or of giving preferential treatment, an employee whose duties
would affect the financial interests of a friend, relative or person with whom he is
affiliated in a nongovernmental capacity shall comply with any applicable
requirements of $2635.502.
-57-
(e) Use of terms of address and ranks. Nothing in this section prohibits an employee
who is ordinarily addressed using a general term of address, such as "The
Honorable", or a rank, such as a military or ambassadorial rank, from using that
term of address or rank in connection with a personal activity.
$2635.703
Use of nonpublic information.
(a) Prohibition. An employee shall not engage in a financial transaction using
nonpublic information, nor allow the improper use of nonpublic information to further
his own private interest or that of another, whether through advice or
recommendation, or by knowing unauthorized disclosure.
(b) Definition of nonpublic information. For purposes of this section, nonpublic
information is information that the employee gains by reason of Federal employment
and that he knows or reasonably should know has not been made available to the
general public. It includes information that he knows or reasonably should know:
(1) Is routinely exempt from disclosure under 5 U.S.C. 552 or otherwise protected
from disclosure by statute, Executive order or regulation;
(2) Is designated as confidential by an agency; or
(3) Has not actually been disseminated to the general public and is not authorized to
be made available to the public on request.
Example 1: A Navy employee learns in the course of her duties that a small
corporation will be awarded a Navy contract for electrical test equipment. She may
not take any action to purchase stock in the corporation or its suppliers and she may
not advise friends or relatives to do so until after public announcement of the award.
Such actions could violate Federal securities statutes as well as this section.
Example 2: A General Services Administration employee involved in evaluating
proposals for a construction contract cannot disclose the terms of a competing
proposal to a friend employed by a company bidding on the work. Prior to award of
the contract, bid- or proposal information is nonpublic information specifically
protected by 41 U.S.C. 423.
Example 3: An employee is a member of a source selection team assigned to review
the proposals submitted by several companies in response to an Army solicitation for
spare parts. As a member of the evaluation team, the employee has access to
proprietary information regarding the production methods of Alpha Corporation, one
of the competitors. He may not use that information to assist Beta Company in
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drafting a proposal to compete for a Navy spare parts contract. The Federal
Acquisition Regulation in 48 CFR parts 3, 14 and 15 restricts the release of
information related to procurements and other contractor information that must be
protected under 18 U.S.C. 1905 and 41 U.S.C. 423.
Example 4: An employee of the Nuclear Regulatory Commission inadvertently
includes a document that is exempt from disclosure with a group of documents
released in response to a Freedom of Information Act request. Regardless of whether
the document is used improperly, the employee's disclosure does not violate this
section because it was not a knowing unauthorized disclosure made for the purpose
of furthering a private interest.
Example 5: An employee of the Army Corps of Engineers is actively involved in the
activities of an organization whose goals relate to protection of the environment. The
employee may not, other than as permitted by agency procedures, give the
organization or a newspaper reporter nonpublic information about long-range plans
to build a particular dam.
$2635.704
Use of Government property.
(a) Standard. An employee has a duty to protect and conserve Government property
and shall not use such property, or allow its use, for other than authorized purposes.
(b) Definitions. For purposes of this section:
(1) Government property includes any form of real or personal property in which the
Government has an ownership, leasehold, or other property interest as well as any
right or other intangible interest that is purchased with Government funds, including
the services of contractor personnel. The term includes office supplies, telephone and
other telecommunications equipment and services, the Government mails, automated
data processing capabilities, printing and reproduction facilities, Government records,
and Government vehicles.
(2) Authorized purposes are those purposes for which Government property is made
available to members of the public or those purposes authorized in accordance with
law or regulation.
Example 1: Under regulations of the General Services Administration at 41 CFR
201-21.601, an employee may make a personal long distance call charged to her
personal calling card.
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Example 2: An employee of the Commodity Futures Trading Commission whose office
computer gives him access to a commercial service providing information for investors
may not use that service for personal investment research.
Example 3: In accordance with chapter 252 of the Federal Personnel Manual, an
attorney employed by the Department of Justice may be permitted to use her office
word processor and agency photocopy equipment to prepare a paper to be presented
at a conference sponsored by a professional association of which she is a member.
$2635.705
Use of official time.
(a) Use of an employee's own time. Unless authorized in accordance with law or
regulations to use such time for other purposes, an employee shall use official time
in an honest effort to perform official duties. An employee not under a leave system,
including a Presidential appointee exempted under 5 U.S.C. 6301(2), has an
obligation to expend an honest effort and a reasonable proportion of his time in the
performance of official duties.
Example 1: An employee of the Social Security Administration may use official time
to engage in certain representational activities on behalf of the employee union of
which she is a member. Under 5 U.S.C. 7131, this is a proper use of her official time
even though it does not involve performance of her assigned duties as a disability
claims examiner.
Example 2: A pharmacist employed by the Department of Veterans Affairs has been
granted excused absence to participate as a speaker in a conference on drug abuse
sponsored by the professional association to which he belongs. Although excused
absence granted by an agency in accordance with guidance in chapter 630 of the
Federal Personnel Manual allows an employee to be absent from his official duties
without charge to his annual leave account, such absence is not on official time.
(b) Use of a subordinate's time. An employee shall not encourage, direct, coerce, or
request a subordinate to use official time to perform activities other than those
required in the performance of official duties or authorized in accordance with law or
regulation.
Example 1: An employee of the Department of Housing and Urban Development may
not ask his secretary to type his personal correspondence during duty hours. Further,
directing or coercing a subordinate to perform such activities during nonduty hours
constitutes an improper use of public office for private gain in violation of
§2635.702(a). Where the arrangement is entirely voluntary and appropriate
compensation is paid, the secretary may type the correspondence at home on her own
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time. Where the compensation is not adequate, however, the arrangement would
involve a gift to the superior in violation of the standards in subpart C of this part.
Subpart H -- Outside Activities
$2635.801
Overview.
(a) This subpart contains provisions relating to outside employment, outside activities
and personal financial obligations of employees that are in addition to the principles
and standards set forth in other subparts of this part. Several of these provisions
apply to uncompensated as well as to compensated outside activities.
(b) An employee who wishes to engage in outside employment or other outside
activities must comply with all relevant provisions of this subpart, including, when
applicable:
(1) The prohibition on outside employment or any other outside activity that conflicts
with the employee's official duties;
(2) Any agency-specific requirement for prior approval of outside employment or
activities;
(3) The limitations on receipt of outside earned income by certain Presidential
appointees and other noncareer employees;
(4) The limitations on paid and unpaid service as an expert witness;
(5) The limitations on participation in professional organizations;
(6) The limitations on paid and unpaid teaching, speaking, and writing; and
(7) The limitations on fundraising activities.
(c) Outside employment and other outside activities of an employee must also comply
with applicable provisions set forth in other subparts of this part and in supplemental
agency regulations. These include the principle that an employee shall endeavor to
avoid actions creating an appearance of violating any of the ethical standards in this
part and the prohibition against use of official position for an employee's private gain
or for the private gain of any person with whom he has employment or business
relations or is otherwise affiliated in a nongovernmental capacity.
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(d) In addition to the provisions of this and other subparts of this part, an employee
who wishes to engage in outside employment or other outside activities must comply
with applicable statutes and regulations. Relevant provisions of law, many of which
are listed in subpart I of this part, may include:
(1) 18 U.S.C. 201(b), which prohibits a public official from seeking, accepting or
agreeing to receive or accept anything of value in return for being influenced in the
performance of an official act or for being induced to take or omit to take any action
in violation of his official duty;
(2) 18 U.S.C. 201(c), which prohibits a public official, otherwise than as provided by
law for the proper discharge of official duty, from seeking, accepting, or agreeing to
receive or accept anything of value for or because of any official act;
(3) 18 U.S.C. 203(a), which prohibits an employee from seeking, accepting, or agreeing
to receive or accept compensation for any representational services, rendered
personally or by another, in relation to any particular matter in which the United
States is a party or has a direct and substantial interest, before any department,
agency, or other specified entity. This statute contains several exceptions, as well as
standards for special Government employees that limit the scope of the restriction;
(4) 18 U.S.C. 205, which prohibits an employee, whether or not for compensation,
from acting as agent or attorney for anyone in a claim against the United States or
from acting as agent or attorney for anyone, before any department, agency, or other
specified entity, in any particular matter in which the United States is a party or has
a direct and substantial interest. It also prohibits receipt of any gratuity, or any
share of or interest in a claim against the United States, in consideration for
assisting in the prosecution of such claim. This statute contains several exceptions,
as well as standards for special Government employees that limit the scope of the
restrictions;
(5) 18 U.S.C. 209, which prohibits an employee, other than a special Government
employee, from receiving any salary or any contribution to or supplementation of
salary from any source other than the United States as compensation for services as
a Government employee. The statute contains several exceptions that limit its
applicability;
(6) The Emoluments Clause of the United States Constitution, article I, section 9,
clause 8, which prohibits anyone holding an office of profit or trust under the United
States from accepting any gift, office, title or emolument, including salary or
compensation, from any foreign government except as authorized by Congress. In
addition, 18 U.S.C. 219 generally prohibits any public official from being or acting as
an agent of a foreign principal, including a foreign government, corporation or person,
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if the employee would be required to register as a foreign agent under 22 U.S.C. 611
et seq.;
(7) The Hatch Act, 5 U.S.C. 7321 through 7328, which prohibits most employees from
engaging in certain partisan political activities and prohibits all employees from
interfering with elections and conducting political activities in the Federal workplace;
(8) The honorarium prohibition, 5 U.S.C. App. (Ethics in Government Act of 1978),
which prohibits an employee, other than a special Government employee, from
receiving any compensation for an appearance, speech or article. Implementing
regulations are contained in §§2636.201 through 2636.205 of this chapter; and
(9) The limitations on outside employment, 5 U.S.C. App. (Ethics in Government Act
of 1978), which prohibit a covered noncareer employee's receipt of compensation for
specified activities and provide that he shall not allow his name to be used by any
firm or other entity which provides professional services involving a fiduciary
relationship. Implementing regulations are contained in §§2636.305 through 2636.307
of this chapter.
$2635.802
Conflicting outside employment and activities.
An employee shall not engage in outside employment or any other outside activity
that conflicts with his official duties. An activity conflicts with an employee's official
duties:
(a) If it is prohibited by statute or by an agency supplemental regulation; or
(b) If, under the standards set forth in §§2635.402 and 2635.502, it would require the
employee's disqualification from matters so central or critical to the performance of
his official duties that the employee's ability to perform the duties of his position
would be materially impaired.
Employees are cautioned that even though an outside activity may not be prohibited
under this section, it may violate other principles or standards set forth in this part
or require the employee to disqualify himself from participation in certain particular
matters under either subpart D or subpart E of this part.
Example 1: An employee of the Environmental Protection Agency has just been
promoted. His principal duty in his new position is to write regulations relating to the
disposal of hazardous waste. The employee may not continue to serve as president of
a nonprofit environmental organization that routinely submits comments on such
regulations. His service as an officer would require his disqualification from duties
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critical to the performance of his official duties on a basis so frequent as to materially
impair his ability to perform the duties of his position.
Example 2: An employee of the Occupational Safety and Health Administration who
was and is expected again to be instrumental in formulating new OSHA safety
standards applicable to manufacturers that use chemical solvents has been offered
a consulting contract to provide advice to an affected company in restructuring its
manufacturing operations to comply with the OSHA standards. The employee should
not enter into the consulting arrangement even though he is not currently working
on OSHA standards affecting this industry and his consulting contract can be
expected to be completed before he again works on such standards. Even though the
consulting arrangement would not be a conflicting activity within the meaning of
$2635.802, it would create an appearance that the employee had used his official
position to obtain the compensated outside business opportunity and it would create
the further appearance of using his public office for the private gain of the
manufacturer.
$2635.803
Prior approval for outside employment and activities.
When required by agency supplemental regulation, an employee shall obtain prior
approval before engaging in outside employment or activities. Where it is determined
to be necessary or desirable for the purpose of administering its ethics program, an
agency shall, by supplemental regulation, require employees or any category of
employees to obtain prior approval before engaging in specific types of outside
activities, including outside employment.
Note: Any requirement for prior approval of employment or activities contained in
any agency regulation, instruction, or other issuance in effect prior to the effective
date of this part shall constitute a requirement for prior approval for purposes of this
section for one year after the effective date of this part or until issuance of an agency
supplemental regulation, whichever occurs first.
$2635.804
Outside earned income limitations applicable to certain Presidential
appointees and other noncareer employees.
(a) Presidential appointees to full-time noncareer positions. A Presidential appointee
to a full-time noncareer position shall not receive any outside earned income for
outside employment, or for any other outside activity, performed during that
Presidential appointment. This limitation does not apply to any outside earned
income received for outside employment, or for any other outside activity, carried out
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in satisfaction of the employee's obligation under a contract entered into prior to April
12, 1989.
(b) Covered noncareer employees. Covered noncareer employees, as defined in
§2636.303(a) of this chapter, may not, in any calendar year, receive outside earned
income attributable to that calendar year which exceeds 15 percent of the annual rate
of basic pay for level II of the Executive Schedule under 5 U.S.C. 5313, as in effect
on January 1 of such calendar year. Employees should consult the regulations
implementing this limitation, which are contained in §§2636.301 through 2636.304
of this chapter.
Note: In addition to the 15 percent limitation on outside earned income, covered
noncareer employees are prohibited from receiving any compensation for: practicing
a profession which involves a fiduciary relationship; affiliating with or being
employed by a firm or other entity which provides professional services involving a
fiduciary relationship; serving as an officer or member of the board of any association,
corporation or other entity; or teaching without prior approval. Implementing
regulations are contained in §§2636.305 through 2636.307 of this chapter.
(c) Definitions. For purposes of this section:
(1) Outside earned income has the meaning set forth in §2636.303(b) of this chapter,
except that §2636.303(b)(8) shall not apply.
(2) Presidential appointee to a full-time noncareer position means any employee who
is appointed by the President to a full-time position described in 5 U.S.C. 5312
through 5317 or to a position that, by statute or as a matter of practice, is filled by
Presidential appointment, other than:
(i) A position filled under the authority of 3 U.S.C. 105 or 3 U.S.C. 107(a) for which
the rate of basic pay is less than that for GS-9, step 1 of the General Schedule;
(ii) A position, within a White House operating unit, that is designated as not
normally subject to change as a result of a Presidential transition;
(iii) A position within the uniformed services; or
(iv) A position in which a member of the foreign service is serving that does not
require advice and consent of the Senate.
Example 1: A career Department of Justice employee who is detailed to a
policy-making position in the White House Office that is ordinarily filled by a
noncareer employee is not a Presidential appointee to a full-time noncareer position.
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Example 2: A Department of Energy employee appointed under $213.3301 of this title
to a Schedule C position is appointed by the agency and, thus, is not a Presidential
appointee to a full-time noncareer position.
$2635.805
Service as an expert witness.
(a) Restriction. An employee shall not serve, other than on behalf of the United
States, as an expert witness, with or without compensation, in any proceeding before
a court or agency of the United States in which the United States is a party or has
a direct and substantial interest, unless the employee's participation is authorized by
the agency under paragraph (c) of this section. Except as provided in paragraph (b)
of this section, this restriction shall apply to a special Government employee only if
he has participated as an employee or special Government employee in the particular
proceeding or in the particular matter that is the subject of the proceeding.
(b) Additional restriction applicable to certain special Government employees. (1) In
addition to the restriction described in paragraph (a) of this section, a special
Government employee described in paragraph (b)(2) of this section shall not serve,
other than on behalf of the United States, as an expert witness, with or without
compensation, in any proceeding before a court or agency of the United States in
which his employing agency is a party or has a direct and substantial interest, unless
the employee's participation is authorized by the agency under paragraph (c) of this
section.
(2) The restriction in paragraph (b)(1) of this section shall apply to a special
Government employee who:
(i) Is appointed by the President;
(ii) Serves on a commission established by statute; or
(iii) Has served or is expected to serve for more than 60 days in a period of 365
consecutive days.
(c) Authorization to serve as an expert witness. Provided that the employee's
testimony will not result in compensation for an appearance in violation of $2636.201
of this chapter or violate any of the principles or standards set forth in this part,
authorization to provide expert witness service otherwise prohibited by paragraphs
(a) and (b) of this section may be given by the designated agency ethics official of the
agency in which the employee serves when:
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(1) After consultation with the agency representing the Government in the proceeding
or, if the Government is not a party, with the Department of Justice and the agency
with the most direct and substantial interest in the matter, the designated agency
ethics official determines that the employee's service as an expert witness is in the
interest of the Government; or
(2) The designated agency ethics official determines that the subject matter of the
testimony does not relate to the employee's official duties within the meaning of
§2635.807(a)(2)(i).
(d) Nothing in this section prohibits an employee from serving as a fact witness when
subpoenaed by an appropriate authority.
$2635.806
Participation in professional associations. [Reserved]
$2635.807
Teaching, speaking and writing.
(a) Compensation for teaching, speaking or writing. Except as permitted by
paragraph (a)(3) of this section, an employee, including a special Government
employee, shall not receive compensation from any source other than the Government
for teaching, speaking or writing that relates to the employee's official duties.
(1) Relationship to other limitations on receipt of compensation. The compensation
prohibition contained in this section is in addition to any other limitation on receipt
of compensation set forth in this chapter, including:
(i) The honorarium prohibition on receipt of compensation for an appearance, speech
or article, which is implemented in $$2636.201 through 2636.205 of this chapter;
(ii) The requirement contained in $2636.307 of this chapter that covered noncareer
employees obtain advance authorization before engaging in teaching for
compensation; and
(iii) The prohibitions and limitations in $2635.804 and in $2636.304 of this chapter
on receipt of outside earned income applicable to certain Presidential appointees and
to other covered noncareer employees.
Example 1. A personnel specialist employed by the Department of Labor has been
asked by the publisher of a magazine to write an article on his hobby of collecting
arrowheads. Even though the subject matter is unrelated to his official duties, he may
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not accept the publisher's offer of $200 for the article. Because the compensation
offered is for an article, its receipt would violate the honorarium prohibition contained
in §§2636.201 through 2636.205 of this chapter.
(2) Definitions. For purposes of this paragraph:
(i) Teaching, speaking or writing relates to the employee's official duties if:
(A) The activity is undertaken as part of the employee's official duties;
(B) The circumstances indicate that the invitation to engage in the activity was
extended to the employee primarily because of his official position rather than his
expertise on the particular subject matter;
(C) The invitation to engage in the activity or the offer of compensation for the
activity was extended to the employee, directly or indirectly, by a person who has
interests that may be affected substantially by performance or nonperformance of the
employee's official duties;
(D) The information conveyed through the activity draws substantially on ideas or
official data that are nonpublic information as defined in §2635.703(b); or
(E) Except as provided in paragraph (a)(2)(i)(E)(4) of this section, the subject of the
activity deals in significant part with:
(1) Any matter to which the employee presently is assigned or to which the employee
had been assigned during the previous one-year period;
(2) Any ongoing or announced policy, program or operation of the agency; or
(3) In the case of a noncareer employee as defined in §2636.303(a) of this chapter, the
general subject matter area, industry, or economic sector primarily affected by the
programs and operations of his agency.
(4) The restrictions in paragraphs (a)(2)(i)(E) (2) and (3) of this section do not apply
to a special Government employee. The restriction in paragraph (a)(2)(i)(E)(1) of this
section applies only during the current appointment of a special Government
employee; except that if the special Government employee has not served or is not
expected to serve for more than 60 days during the first year or any subsequent one
year period of that appointment, the restriction applies only to particular matters
involving specific parties in which the special Government employee has participated
or is participating personally and substantially.
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Note: Section 2635.807(a)(2)(i)(E) does not preclude an employee, other than a covered
noncareer employee, from receiving compensation for teaching, speaking or writing
on a subject within the employee's discipline or inherent area of expertise based on
his educational background or experience even though the teaching, speaking or
writing deals generally with a subject within the agency's areas of responsibility.
Example 1: The Director of the Division of Enforcement at the Commodity Futures
Trading Commission has a keen interest in stamp collecting and has spent years
developing his own collection as well as studying the field generally. He is asked by
an international society of philatelists to give a series of four lectures on how to
assess the value of American stamps. Because the subject does not relate to his
official duties, the Director may accept compensation for the lecture series. He could
not, however, accept a similar invitation from a commodities broker.
Example 2: A scientist at the National Institutes of Health, whose principal area of
Government research is the molecular basis of the development of cancer, could not
be compensated for writing a book which focuses specifically on the research she
conducts in her position at NIH, and thus, relates to her official duties. However, the
scientist could receive compensation for writing or editing a textbook on the
treatment of all cancers, provided that the book does not focus on recent research at
NIH, but rather conveys scientific knowledge gleaned from the scientific community
as a whole. The book might include a chapter, among many other chapters, which
discusses the molecular basis of cancer development. Additionally, the book could
contain brief discussions of recent developments in cancer treatment, even though
some of those developments are derived from NIH research, as long as it is available
to the public.
Example 3: On his own time, a National Highway Traffic Safety Administration
employee prepared a consumer's guide to purchasing a safe automobile that focuses
on automobile crash worthiness statistics gathered and made public by NHTSA. He
may not receive royalties or any other form of compensation for the guide. The guide
deals in significant part with the programs or operations of NHTSA and, therefore,
relates to the employee's official duties. On the other hand, the employee could
receive royalties from the sale of a consumer's guide to values in used automobiles
even though it contains a brief, incidental discussion of automobile safety standards
developed by NHTSA.
Example 4: An employee of the Securities and Exchange Commission may not receive
compensation for a book which focuses specifically on the regulation of the securities
industry in the United States, since that subject concerns the regulatory programs
or operations of the SEC. The employee may, however, write a book about the
advantages of investing in various types of securities as long as the book contains
only an incidental discussion of any program or operation of the SEC.
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Example 5: An employee of the Department of Commerce who works in the
Department's employee relations office is an acknowledged expert in the field of
Federal employee labor relations, and participates in Department negotiations with
employee unions. The employee may receive compensation from a private training
institute for a series of lectures which describe the decisions of the Federal Labor
Relations Authority concerning unfair labor practices, provided that her lectures do
not contain any significant discussion of labor relations cases handled at the
Department of Commerce, or the Department's labor relations policies. Federal Labor
Relations Authority decisions concerning Federal employee unfair labor practices are
not a specific program or operation of the Department of Commerce and thus do not
relate to the employee's official duties. However, an employee of the FLRA could not
give the same presentations for compensation.
Example 6: A program analyst employed at the Environmental Protection Agency
may receive royalties and other compensation for a book about the history of the
environmental movement in the United States even though it contains brief
references to the creation and responsibilities of the EPA. A covered noncareer
employee of the EPA, however, could not receive compensation for writing the same
book because it deals with the general subject matter area affected by EPA programs
and operations. Neither employee could receive compensation for writing a book that
focuses on specific EPA regulations or otherwise on its programs and operations.
Example 7: An attorney in private practice has been given a one year appointment
as a special Government employee to serve on an advisory committee convened for
the purpose of surveying and recommending modification of procurement regulations
that deter small businesses from competing for Government contracts. Because his
service under that appointment is not expected to exceed 60 days, the attorney may
accept compensation for an article about the anticompetitive effects of certain
regulatory certification requirements even though those regulations are being
reviewed by the advisory committee. The regulations which are the focus of the
advisory committee deliberations are not a particular matter involving specific
parties. Because the information is nonpublic, he could not, however, accept
compensation for an article which recounts advisory committee deliberations that
took place in a meeting closed to the public in order to discuss proprietary
information provided by a small business.
Example 8: A biologist who is an expert in marine life is employed for more than 60
days in a year as a special Government employee by the National Science Foundation
to assist in developing a program of grants by the Foundation for the study of coral
reefs. The biologist may continue to receive compensation for speaking, teaching and
writing about marine life generally and coral reefs specifically. However, during the
term of her appointment as a special Government employee, she may not receive
compensation for an article about the NSF program she is participating in developing.
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Only the latter would concern a matter to which the special Government employee
is assigned.
Example 9: An expert on international banking transactions has been given a
one-year appointment as a special Government employee to assist in analyzing
evidence in the Government's fraud prosecution of owners of a failed savings and loan
association. It is anticipated that she will serve fewer than 60 days under that
appointment. Nevertheless, during her appointment, the expert may not accept
compensation for an article about the fraud prosecution, even though the article does
not reveal nonpublic information. The prosecution is a particular matter that involves
specific parties.
(ii) Agency has the meaning set forth in §2635.102(a), except that any component of
a department designated as a separate agency under §2635.203(a) shall be considered
a separate agency.
(iii) Compensation includes any form of consideration, remuneration or income,
including royalties, given for or in connection with the employee's teaching, speaking
or writing activities. Unless accepted under specific statutory authority, such as 31
U.S.C. 1353, 5 U.S.C. 4111 or 7342, or an agency gift acceptance statute, it includes
transportation, lodgings and meals, whether provided in kind, by purchase of a ticket,
by payment in advance or by reimbursement after the expense has been incurred. It
does not include:
(A) Items offered by any source that could be accepted from a prohibited source under
subpart B of this part;
(B) Meals or other incidents of attendance such as waiver of attendance fees or course
materials furnished as part of the event at which the teaching or speaking takes
place; or
(C) Copies of books or of publications containing articles, reprints of articles, tapes
of speeches, and similar items that provide a record of the teaching, speaking or
writing activity.
(iv) Receive means that there is actual or constructive receipt of the compensation by
the employee SO that the employee has the right to exercise dominion and control over
the compensation and to direct its subsequent use. Compensation received by an
employee includes compensation which is:
(A) Paid to another person, including a charitable organization, on the basis of
designation, recommendation or other specification by the employee; or
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(B) Paid with the employee's knowledge and acquiescence to his parent, sibling,
spouse, child, or dependent relative.
(v) Particular matter involving specific parties has the meaning set forth in
§2637.102(a)(7) of this chapter.
(vi) Personal and substantial participation has the meaning set forth in
§2635.402(b)(4).
(3) Exception for teaching certain courses. Notwithstanding that the activity would
relate to his official duties under paragraphs (a)(2)(i) (B) or (E) of this section, an
employee may accept compensation for teaching a course requiring multiple
presentations by the employee if the course is offered as part of:
(i) The regularly established curriculum of:
(A) An institution of higher education as defined at 20 U.S.C. 1141(a);
(B) An elementary school as defined at 20 U.S.C. 2891(8); or
(C) A secondary school as defined at 20 U.S.C. 2891(21); or
(ii) A program of education or training sponsored and funded by the Federal
Government or by a State or local government which is not offered by an entity
described in paragraph (a)(3)(i) of this section.
Example 1: An employee of the Cost Accounting Standards Board who teaches an
advanced accounting course as part of the regular business school curriculum of an
accredited university may receive compensation for teaching the course even though
a substantial portion of the course deals with cost accounting principles applicable
to contracts with the Government. Moreover, his receipt of a salary or other
compensation for teaching this course does not violate the honorarium prohibition on
receipt of compensation for any speech, which is implemented in §§2636.201 through
2636.205 of this chapter.
Example 2: An attorney employed by the Equal Employment Opportunity
Commission may accept compensation for teaching a course at a state college on the
subject of Federal employment discrimination law. The attorney could not accept
compensation for teaching the same seminar as part of a continuing education
program sponsored by her bar association because the subject of the course is focused
on the operations or programs of the EEOC and the sponsor of the course is not an
accredited educational institution.
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Example 3: An employee of the National Endowment for the Humanities is invited
by a private university to teach a course that is a survey of Government policies in
support of artists, poets and writers. As part of his official duties, the employee
administers a grant that the university has received from the NEH. The employee
may not accept compensation for teaching the course because the university has
interests that may be substantially affected by the performance or nonperformance
of the employee's duties. Likewise, an employee may not receive compensation for any
teaching that is undertaken as part of his official duties or that involves the use of
nonpublic information.
(b) Reference to official position. An employee who is engaged in teaching, speaking
or writing as outside employment or as an outside activity shall not use or permit the
use of his official title or position to identify him in connection with his teaching,
speaking or writing activity or to promote any book, seminar, course, program or
similar undertaking, except that:
(1) An employee may include or permit the inclusion of his title or position as one of
several biographical details when such information is given to identify him in
connection with his teaching, speaking or writing, provided that his title or position
is given no more prominence than other significant biographical details;
(2) An employee may use, or permit the use of, his title or position in connection with
an article published in a scientific or professional journal, provided that the title or
position is accompanied by a reasonably prominent disclaimer satisfactory to the
agency stating that the views expressed in the article do not necessarily represent the
views of the agency or the United States; and
(3) An employee who is ordinarily addressed using a general term of address, such
as "The Honorable," or a rank, such as a military or ambassadorial rank, may use or
permit the use of that term of address or rank in connection with his teaching,
speaking or writing.
Note: Some agencies may have policies requiring advance agency review, clearance,
or approval of certain speeches, books, articles or similar products to determine
whether the product contains an appropriate disclaimer, discloses nonpublic
information, or otherwise complies with this section.
Example 1: A meteorologist employed with the National Oceanic and Atmospheric
Administration is asked by a local university to teach a graduate course on
hurricanes. The university may include the meteorologist's Government title and
position together with other information about his education and previous
employment in course materials setting forth biographical data on all teachers
involved in the graduate program. However, his title or position may not be used to
promote the course, for example, by featuring the meteorologist's Government title,
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Senior Meteorologist, NOAA, in bold type under his name. In contrast, his title may
be used in this manner when the meteorologist is authorized by NOAA to speak in
his official capacity.
Example 2: A doctor just employed by the Centers for Disease Control has written a
paper based on his earlier independent research into cell structures. Incident to the
paper's publication in the Journal of the American Medical Association, the doctor
may be given credit for the paper, as Dr. M. Wellbeing, Associate Director, Centers
for Disease Control, provided that the article also contains a disclaimer, concurred
in by the CDC, indicating that the paper is the result of the doctor's independent
research and does not represent the findings of the CDC.
Example 3: An employee of the Federal Deposit Insurance Corporation has been
asked to give a speech in his private capacity, without compensation, to the annual
meeting of a committee of the American Bankers Association on the need for banking
reform. The employee may be described in his introduction at the meeting as an
employee of the Federal Deposit Insurance Corporation provided that other pertinent
biographical details are mentioned as well.
$2635.808
Fundraising activities.
An employee may engage in fundraising only in accordance with the restrictions in
part 950 of this title on the conduct of charitable fundraising in the Federal
workplace and in accordance with paragraphs (b) and (c) of this section.
(a) Definitions. For purposes of this section: (1) Fundraising means the raising of
funds for a nonprofit organization, other than a political organization as defined in
26 U.S.C. 527(e), through:
(i) Solicitation of funds or sale of items; or
(ii) Participation in the conduct of an event by an employee where any portion of the
cost of attendance or participation may be taken as a charitable tax deduction by a
person incurring that cost.
(2) Participation in the conduct of an event means active and visible participation in
the promotion, production, or presentation of the event and includes serving as
honorary chairperson, sitting at a head table during the event, and standing in a
reception line. The term does not include mere attendance at an event provided that,
to the employee's knowledge, his attendance is not used by the nonprofit organization
to promote the event. While the term generally includes any public speaking during
the event, it does not include the delivery of an official speech as defined in
-74-
paragraph (a)(3) of this section or any seating or other participation appropriate to
the delivery of such a speech. Waiver of a fee for attendance at an event by a
participant in the conduct of that event does not constitute a gift for purposes of
subpart B of this part.
Note: This section does not prohibit fundraising for political parties. However, there
are statutory restrictions that apply to political fundraising. Employees, other than
those exempt under 5 U.S.C. 7324(d), are prohibited by the Hatch Act, 5 U.S.C. 7321
through 7328, from soliciting or collecting contributions or other funds for a partisan
political purpose or in connection with a partisan election. In addition, all employees
are prohibited by 18 U.S.C. 602 from knowingly soliciting contributions for any
political purpose from other employees and by 18 U.S.C. 607 from soliciting such
contributions in the Federal workplace.
Example 1: The Secretary of Transportation has been asked to serve as master of
ceremonies for an All-Star Gala. Tickets to the event cost $150 and are tax deductible
as a charitable donation, with proceeds to be donated to a local hospital. By serving
as master of ceremonies, the Secretary would be participating in fundraising.
(3) Official speech means a speech given by an employee in his official capacity on a
subject matter that relates to his official duties, provided that the employee's agency
has determined that the event at which the speech is to be given provides an
appropriate forum for the dissemination of the information to be presented and
provided that the employee does not request donations or other support for the
nonprofit organization. Subject matter relates to an employee's official duties if it
focuses specifically on the employee's official duties, on the responsibilities, programs,
or operations of the employee's agency as described in $2635.807(a)(2)(i)(E), or on
matters of Administration policy on which the employee has been authorized to
speak.
Example 1: The Secretary of Labor is invited to speak at a banquet honoring a
distinguished labor leader, the proceeds of which will benefit a nonprofit organization
that assists homeless families. She devotes a major portion of her speech to the
Administration's Points of Light initiative, an effort to encourage citizens to volunteer
their time to help solve serious social problems. Because she is authorized to speak
on Administration policy, her remarks at the banquet are an official speech. However,
the Secretary would be engaged in fundraising if she were to conclude her official
speech with a request for donations to the nonprofit organization.
Example 2: A charitable organization is sponsoring a two-day tennis tournament at
a country club in the Washington, DC area to raise funds for recreational programs
for learning disabled children. The organization has invited the Secretary of
Education to give a speech on federally funded special education programs at the
awards dinner to be held at the conclusion of the tournament and a determination
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has been made that the dinner is an appropriate forum for the particular speech. The
Secretary may speak at the dinner and, under §2635.204(g)(1), he may partake of the
meal provided to him at the dinner.
(4) Personally solicit means to request or otherwise encourage donations or other
support either through person-to-person contact or through the use of one's name or
identity in correspondence or by permitting its use by others. It does not include the
solicitation of funds through the media or through either oral remarks, or the
contemporaneous dispatch of like items of mass-produced correspondence, if such
remarks or correspondence are addressed to a group consisting of many persons,
unless it is known to the employee that the solicitation is targeted at subordinates
or at persons who are prohibited sources within the meaning of §2635.203(d). It does
not include behind-the-scenes assistance in the solicitation of funds, such as drafting
correspondence, stuffing envelopes, or accounting for contributions.
Example 1: An employee of the Department of the Energy who signs a letter soliciting
funds for a local private school does not "personally solicit" funds when 500 copies of
the letter, which makes no mention of his DOE position and title, are mailed to
members of the local community, even though some individuals who are employed by
Department of Energy contractors may receive the letter.
(b) Fundraising in an official capacity. An employee may participate in fundraising
in an official capacity if, in accordance with a statute, Executive order, regulation or
otherwise as determined by the agency, he is authorized to engage in the fundraising
activity as part of his official duties. When authorized to participate in an official
capacity, an employee may use his official title, position and authority.
Example 1: Because participation in his official capacity is authorized under part 950
of this title, the Secretary of the Army may sign a memorandum to all Army
personnel encouraging them to donate to the Combined Federal Campaign.
(c) Fundraising in a personal capacity. An employee may engage in fundraising in his
personal capacity provided that he does not:
(1) Personally solicit funds or other support from a subordinate or from any person:
(i) Known to the employee, if the employee is other than a special Government
employee, to be a prohibited source within the meaning of §2635.203(d); or
(ii) Known to the employee, if the employee is a special Government employee, to be
a prohibited source within the meaning of §2635.203(d)(4) that is a person whose
interests may be substantially affected by performance or nonperformance of his
official duties;
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(2) Use or permit the use of his official title, position or any authority associated with
his public office to further the fundraising effort, except that an employee who is
ordinarily addressed using a general term of address, such "The Honorable," or a
rank, such as a military or ambassadorial rank, may use or permit the use of that
term of address or rank for such purposes; or
(3) Engage in any action that would otherwise violate this part.
Example 1: A nonprofit organization is sponsoring a golf tournament to raise funds
for underprivileged children. The Secretary of the Navy may not enter the
tournament with the understanding that the organization intends to attract
participants by offering other entrants the opportunity, in exchange for a donation
in the form of an entry fee, to spend the day playing 18 holes of golf in a foursome
with the Secretary of the Navy.
Example 2: An employee of the Merit Systems Protection Board may not use the
agency's photocopier to reproduce fundraising literature for her son's private school.
Such use of the photocopier would violate the standards at $2635.704 regarding use
of Government property.
Example 3: An Assistant Attorney General may not sign a letter soliciting funds for
a homeless shelter as "John Doe, Assistant Attorney General." He also may not sign
a letter with just his signature, "John Doe," soliciting funds from a prohibited source,
unless the letter is one of many identical, mass-produced letters addressed to a large
group where the solicitation is not known to him to be targeted at persons who are
either prohibited sources or subordinates.
$2635.809
Just financial obligations.
Employees shall satisfy in good faith their obligations as citizens, including all just
financial obligations, especially those such as Federal, State, or local taxes that are
imposed by law. For purposes of this section, a just financial obligation includes any
financial obligation acknowledged by the employee or reduced to judgment by a court.
In good faith means an honest intention to fulfill any just financial obligation in a
timely manner. In the event of a dispute between an employee and an alleged
creditor, this section does not require an agency to determine the validity or amount
of the disputed debt or to collect a debt on the alleged creditor's behalf.
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Subpart I -- Related Statutory Authorities
$2635.901
General.
In addition to the standards of ethical conduct set forth in subparts A through H of
this part, there are a number of statutes that establish standards to which an
employee's conduct must conform. The list set forth in $2635.902 references some of
the more significant of those statutes. It is not comprehensive and includes only
references to statutes of general applicability. While it includes references to several
of the basic conflict of interest statutes whose standards are explained in more detail
throughout this part, it does not include references to statutes of more limited
applicability, such as statutes that apply only to officers and employees of the
Department of Defense.
$2635.902
Related statutes.
(a) The prohibition against solicitation or receipt of bribes (18 U.S.C. 201(b)).
(b) The prohibition against solicitation or receipt of illegal gratuities (18 U.S.C.
201(c)).
(c) The prohibition against seeking or receiving compensation for certain
representational services before the Government (18 U.S.C. 203).
(d) The prohibition against assisting in the prosecution of claims against the
Government or acting as agent or attorney before the Government (18 U.S.C. 205).
(e) The post-employment restrictions applicable to former employees (18 U.S.C. 207,
with implementing regulations at parts 2637 and 2641 of this chapter).
(f) The post-employment restrictions applicable to former procurement officials (41
U.S.C. 423(f)).
(g) The prohibition against participating in matters affecting an employee's own
financial interests or the financial interests of other specified persons or organizations
(18 U.S.C. 208).
(h) The prohibition on a procurement official's negotiating for employment with
competing contractors (41 U.S.C. 423(b)(1)).
-78-
(i) The prohibition against receiving salary or any contribution to or supplementation
of salary as compensation for Government service from a source other than the
United States (18 U.S.C. 209).
(j) The prohibition against gifts to superiors (5 U.S.C. 7351).
(k) The prohibition against solicitation or receipt of gifts from specified prohibited
sources (5 U.S.C. 7353).
(1) The prohibition against solicitation or receipt of gifts from competing contractors
(41 U.S.C. 423(b)(2)).
(m) The provisions governing receipt and disposition of foreign gifts and decorations
(5 U.S.C. 7342).
(n) The Code of Ethics for Government Service (Pub. L. 96-303, 94 Stat. 855).
(o) The prohibitions against certain political activities (5 U.S.C. 7321 et seq. and 18
U.S.C. 602, 603, 606 and 607).
(p) The prohibitions against disloyalty and striking (5 U.S.C. 7311 and 18 U.S.C.
1918).
(q) The general prohibition against acting as the agent of a foreign principal required
to register under the Foreign Agents Registration Act (18 U.S.C. 219).
(r) The prohibition against employment of a person convicted of participating in or
promoting a riot or civil disorder (5 U.S.C. 7313).
(s) The prohibition against employment of an individual who habitually uses
intoxicating beverages to excess (5 U.S.C. 7352).
(t) The prohibition against misuse of a Government vehicle (31 U.S.C. 1344).
(u) The prohibition against misuse of the franking privilege (18 U.S.C. 1719).
(v) The prohibition against fraud or false statements in a Government matter (18
U.S.C. 1001).
(w) The prohibition against concealing, mutilating or destroying a public record (18
U.S.C. 2071).
(x) The prohibition against counterfeiting or forging transportation requests (18
U.S.C. 508).
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(y) The restrictions on disclosure of certain sensitive Government information under
the Freedom of Information Act and the Privacy Act (5 U.S.C. 552 and 552a).
(z) The prohibitions against disclosure of classified information (18 U.S.C. 798 and
50 U.S.C. 783(b)).
(aa) The prohibition against disclosure of proprietary information and certain other
information of a confidential nature (18 U.S.C. 1905).
(bb) The prohibition against unauthorized disclosure of certain procurement sensitive
information, including proprietary or source selection information (41 U.S.C. 423(b)
(3) and (d)).
(cc) The prohibition against unauthorized use of documents relating to claims from
or by the Government (18 U.S.C. 285).
(dd) The prohibition against certain personnel practices (5 U.S.C. 2302).
(ee) The prohibition against interference with civil service examinations (18 U.S.C.
1917).
(ff) The restrictions on use of public funds for lobbying (18 U.S.C. 1913).
(gg) The prohibition against participation in the appointment or promotion of
relatives (5 U.S.C. 3110).
(hh) The prohibition against solicitation or acceptance of anything of value to obtain
public office for another (18 U.S.C. 211).
(ii) The prohibition against conspiracy to commit an offense against or to defraud the
United States (18 U.S.C. 371).
(jj) The prohibition against embezzlement or conversion of Government money or
property (18 U.S.C. 641).
(kk) The prohibition against failing to account for public money (18 U.S.C. 643).
(11) The prohibition against embezzlement of the money or property of another person
that is in the possession of an employee by reason of his employment (18 U.S.C. 654).
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Fill
FAHY
THE WHITE HOUSE
WASHINGTON
March 1, 1993
MEMORANDUM FOR EOP SENIOR STAFF
FROM:
MARK GEARAN Melhim
DEPUTY CHIEF OF STAFF
BERNARD NUSSBAUM
COUNSEL TO THE PRESIDENT
SUBJECT:
Ethics Guidelines
As you know, one of the President's first actions was to issue
Executive Order 12834, requiring certain ethics commitments by
senior appointees of the executive branch. "Senior appointees"
is defined in the Order as those employees who are paid at or
above Executive Schedule ("ES") Level V (currently $108,200).
However, as a result of the salary reductions that President
Clinton implemented for a wide range of senior positions in the
EOP, the Order by its terms applies to a smaller than expected
group of senior EOP staff. Indeed, the Order does not cover some
personnel who are in fact "senior appointees" entirely apart from
their pay grades.
Accordingly, beginning today we are requesting, as a condition of
appointment, that all EOP staff earning at or above ES Level V as
well as all Assistants and Deputy Assistants to the President
sign and adhere to the ethics guidelines in the Order.
A copy of the President's Executive Order and the pledges are
attached.
Attachment
THE WHITE HOUSE
WASHINGTON
March 1, 1993
MEMORANDUM FOR SENIOR EOP OFFICIALS
FROM:
BERNARD NUSSBAUM SN/CAM
COUNSEL TO THE PRESIDENT
SUBJECT:
Clinton Ethics Pledges
Attached is a copy of Executive Order 12834 ("Clinton Pledges")
as well as the pledges.
Please take a moment to review all of these materials. Once you
have done so, please sign both forms (if you have not already
done so) and return them to Counsel's Office (Room 128) by
Wednesday, March 3, 1993.
If you have any questions please contact Beth Nolan or Cheryl
Mills in Counsel's Office.
5911
Federal Register
Presidential Documents
Vol. 58. No.13
Friday. January 22, 1993
Title 3-
Executive Order 12834 of January 20, 1993
The President
Ethics Commitments by Executive Branch Appointees
By the authority vested in me as President of the United States by the
Constitution and laws of the United States of America, including section
301 of title 3, United States Code, and sections 3301 and 7301 of title
5, United States Code, it hereby ordered as follows:
Section 1. Ethics Pledges. (a) Every senior appointee in every executive
agency appointed on or after January 20, 1993, shall sign, and upon signing
shall be contractually committed to, the following pledge ("senior appointee
pledge") upon becoming a senior appointee:
"As a condition, and in consideration, of my employment in the
United States Government in a senior appointee position invested
with the public last, I commit myself to the following obligations,
which I understand are binding on me and are enforceable under
law:
"1. I will not, within five years after the termination of my employ-
ment as a senior appointee in any executive agency in which I
am appointed to serve, lobby any officer or employee of that agency.
"2. In the event that I serve as a senior appointee in the Executive
Office of the President ('EOP'), I also will not, within five years
after I cease to be a senior appointee in the EOP, lobby any officer
or employee of any other executive agency with respect to which
I had personal and substantial responsibility as a senior appointee
in the EOP.
"3. I will not, at any time after the termination of my employment
in the United States Government, engage in any activity on behalf
of any foreign government or foreign political party which, if under-
taken on Jar cary 20, 1993, would require me to register under
the Foreign Agen. Registration Act of 1938,
hended.
"4. I will not, within five years after termination of my personal
and substantíal participation in a trade negotiation, represent, aid
or advise any foreign government, foreign political party or foreign
business entity with the intent to influence a decision of any officer
or employee of any executive agency, in carrying out his or her
official duties.
"5. I acknowledge that the Executive order entitled 'Ethics Com-
mitments by Executive Branch Appointees,' issued by the President
on January 20, 1993, which I have read before signing this document,
defines certain of the terms applicable to the foregoing obligations
and sets forth the methods for enforcing them. I expressly accept
the provisions of that Executive order as a part of this agreement
and as binding on me. I understand that the terms of this pledge
are in addition to any statutory or other legal restrictions applicable
to me by virtue of Federal Government service."
(b) Every trade negotiator who is not a senior appointee and is appointed
to a position in an executive agency on or after January 20, 1993, shall
(prior to personally and substantially participating in a trade negotiation)
sign, and upon signing be contractually committed to, the following pledge
("trade negotiator pledge"):
"As a condition, and in consideration, of my employment in the
United States Government as a trade negotiator, which is a position
5912
Federal Register / Vol. 58, No. 13 / Friday. January 22, 1993 / Presidential Documents
invested with the public trust, I commit myself to the following
obligations, which I understand are binding on me and are enforce-
able under law:
"1. I will not, within five years after termination of my personal
and substantial participation in a trade negotiation, represent, aid
or advise any foreign government, foreign political party or foreign
business entity with the intent to influence a decision of any officer
or employee of any executive agency, in carrying out his or her
official duties.
"2. I acknowledge that the Executive order entitled 'Ethics Com-
mitments by Executive Branch Appointees,' issued by the President
on January 20, 1993, which I have read before signing this document,
defines certain of the terms applicable to the foregoing obligations
and sets forth the methods for enforcing them. I expressly accept
the provisions of that Executive order as a part of this agreement
and as binding on me. I understand that the terms of this pledge
are in addition to any statutory or other legal restrictions applicable
to me by virtue of Federal Government service."
Sec. 2. Definitions. As used herein and in the pledges:
(a) "Senior appointee" means every full-time. non-career Presidential, Vice-
presidential or agency head appointee in an executive agency whose rate
of basic pay is not less than the rate for level V of the Executive Schedule
(5 U.S.C. 5316) but does not include any person appointed as a member
of the senior foreign service or solely as a uniformed service commissioned
officer.
(b) "Trade negotiator" means a full-time, non-career Presidential, Vice-presi-
dential or agency head appointee (whether or not a senior appointee) who
personally and substantially participates in a trade negotiation as an em-
ployee of an executive agency.
(c) "Lobby" means to knowingly communicate to or appear before any
officer or employee of any executive agency on behalf of another (except
the United States) with the intent to influence official action, except that
the term "lobby" does not include:
(1) communicating or appearing on behalf of and as an officer or employee
of a State or local government or the government of the District of Columbia,
a Native American tribe or a United States territory or possession:
(2) communicating or appearing with regard to a judicial proceed: 'S.
or a criminal or civil law enforcement inquiry, investigation or proceeding
(but not with regard to an administrative proceeding) or with regard to
an administrative proceeding to the extent that such communications or
appearances are made after the commencement of and in connection with
the conduct or disposition of a judicial proceeding;
(3) communicating or appearing with regard to any government grant,
contract or similar benefit on behalf of and as an officer or employee of:
(A) an accredited, degree-granting institution of higher education, as
defined in section 1201(a) of title 20, United States Code; or
(B) a hospital; a medical, scientific or environmental research institu-
tion; or a charitable or educational institution; provided that such entity
is a not-for-profit organization exempted from Federal income taxes under
sections 501(a) and 501(c)(3) of title 26, United States Code;
(4) communicating or appearing on behalf of an international organization
in which the United States participates, if the Secretary of State certifies
in advance that such activity is in the interest of the United States;
(5) communicating or appearing solely for the purpose of furnishing sci-
entific or technological information, subject to the procedures and conditions
applicable under section 207(j)(5) of title 18, United States Code; or
(6) giving testimony under oath, subject to the conditions applicable under
section 207(j)(6) of title 18, United States Code.
Federal Register / Vol. 58, No. 13 / Friday. January 22. 1993 / Presidential Documents
5913
(d) "On behalf of another" means on behalf of a person or entity other
than the individual signing the pledge or his or her spouse, child or parent.
(e) "Administrative proceeding" means any agency process for rulemaking.
adjudication or licensing, as defined in and governed by the Administrative
Procedure Act, as amended (5 U.S.C. 551, et seq.).
(f) "Executive agency" and "agency" mean "Executive agency" as defined
in section 105 of title 5. United States Code, except that the term includes
the Executive Office of the President. the United States Postal Sen ice and
the Postal Rate Commission and excludes the General Accounting Office.
As used in paragraph 1 of the senior appointee pledge, "executive agency"
means the entire agency in which the senior appointee is appointed to
serve, except that:
(1) with respect to those senior appointees to whom such designations
are applicable under section 207(h) of title 18, United States Code, the
term means an agency or bureau designated by the Director of the Office
of Government Ethics under section 207(h) as a separate department or
agency at the time the senior appointee ceased to serve in that department
or agency; and
(2) a senior appointee who is detailed from one executive agency to
another for more than sixty days in any calendar year shall be deemed
to be an officer or employee of both agencies during the period sucn person
is detailed.
(g) "Personal and substantial responsibility" "with respect to" an executive
agency, as used in paragraph 2 of the senior appointee pledge, means ongoing
oversight of, or significant ongoing decision-making involvement in, the
agency's budget, major programs or personnel actions, when acting both
"personally" and "substantially" (as those terms are defined for purposes
of sections 207(a) and (b) of title 18, United States Code).
(h) "Personal and substantial participation" and "personally and substantially
participates" mean acting both "personally" and "substantially" (as those
terms are defined for purposes of sections 207(a) and (b) of title 18, United
States Code) as an employee through decision, approval, disapproval, rec-
ommendation, the rendering of advice, investigation or other such action.
(i) "Trade negotiation" means a negotiation that the President determines
to undertake to enter into a trade agreement with one or more foreign
governments, and dues not include any action taken before that determina-
tion.
(j) "Foreign Agents Registration Act of 1938, as amended" means sections
611-621 of title 22, United States Code.
(k) "Foreign government" means "the government of a foreign country,"
as defined in section 1(e) of the Foreign Agents Registration Act of 1938,
as amended (22 U.S.C. 611(e)).
(1) "Foreign political party" has the same meaning as that term in section
1(f) of the Foreign Agents Registration Act of 1938, as amended (22 U.S.C.
611(f).
(m) "Foreign business entity" means a partnership. association, corporation,
organization or other combination of persons organized under the laws of
or having its principal place of business in a foreign country.
(n) Terms that are used herein and in the pledges, and also used in section
207 of title 18. United States Code, shall be given the same meaning as
they have in section 207 and any implementing regulations issued or to
be issued by the Office of Government Ethics, except to the extent those
terms are otherwise defined in this order.
Sec. 3. Waiver. (a) The President may grant to any person a waiver of
any restrictions contained in the pledge signed by such person if, and
to the extent that, the President certifies in writing that it is in the public
Interest to grant the waiver.
5914
Federal Register / Vol. 58, No. 13 / Friday, January 22, 1993 1 Presidential Documents
(b) A waiver shall take effect when the certification is signed by the President.
(c) The waiver certification shall be published in the Federal Register,
Identifying the name and executive agency position of the person covered
by the waiver and the reasons for granting It.
(d) A copy of the waiver certification shall be furnished to the person
covered by the waiver and filed with the head of the agency in which
that person is or was appointed to serve.
Sec. 4. Administration. (a) The head of every executive agency shall establish
for that agency such rules or procedures (conforming as nearly as practicable
to the agency's general ethics rules and procedures, including those relating
to designated agency ethics officers) as are necessary or appropriate:
(1) to ensure that every senior appointee in the agency signs the senior
appointee pledge upon assuming the appointed office or otherwise becoming
a senior appointee;
(2) to ensure that every trade negotiator in the agency who is not a
senior appointee signs the trade negotiator pledge prior to personally and
substantially participating in a trade negotiation;
(3) to ensure that no senior appointee or trade negotiator in the agency
personally and substantially participates in a trade negotiation prior to sign-
ing the pledge; and
(4) generally to ensure compliance with this order within the agency.
(b) With respect to the Executive Office of the President, the duties set
forth in section 4(a), above, shall be the responsibility of the White House
Counsel or such other official or officials to whom the President delegates
those duties.
(c) The Director of the Office of Government Ethics shall:
(1) subject to the prior approval of the White House Counsel, develop
a form of the pledges to be completed by senior appointees and trade
negotiators and see that the pledges and a copy of this Executive order
are made available for use by agencies in fulfilling their duties under section
4(a) above;
(2) in consultation with the Attorney General or White House Counsel,
when appropriate. assist designated agency ethics officers in providing advice
to current or former senior appointees and trade negotiators regarding the
application of the pledges; and
(3) subject to the prior approval of the White House Counsel, adopt such
rules or procedures (conforming as nearly as practicable to its generally
applicable rules and procedures) as are necessary or appropriate to carry
out the foregoing responsibilities.
(d) In order to promote clarity and fairness in the application of paragraph
3 of the senior appointee pledge:
(1) the Attorney General shall, within six months after the issuance of
this order, publish in the Federal Register a "Statement of Covered Activi-
ties," based on the statute, applicable regulations and published guidelines,
and any other material reflecting the Attorney General's current interpretation
of the law, describing in sufficient detail to provide adequate guidance
the activities on behalf of a foreign government or foreign political party
which, if undertaken as of January 20, 1993, would require a person to
register as an agent for such foreign government or political party under
the Foreign Agents Registration Act of 1938, as amended; and
(2) the Attorney General's "Statement of Covered Activities" shall be
presumed to be the definitive statement of the activities in which the senior
appointee agrees not to engage under paragraph 3 of the pledge.
(e) A senior appointee who has signed the senior appointee pledge is not
required to sign the pledge again upon appointment to a different office,
except that a person who has ceased to be a senior appointee, due to
Federal Register / Vol. 58, No. 13 / Friday, January 22, 1993 / Presidential Documents
5915
termination of employment in the executive branch or otherwise, shall sign
the senior appointee pledge prior to thereafter assuming office as a senior
appointee.
(f) A trade negotiator who is not also a senior appointee and who has
once signed the trade negotiator pledge is not required to sign the pledge
again prior to person: :ly and substantially participating in a subsequent
trade negotiation, except that a person who has ceased employment in
the executive branch shall, after returning to such employment. be obligated
to sign a pledge as provided herein notwithstanding the signing of any
previous pledge.
(g) All pledges signed by senior appointees and trade negotiators, and all
waiver certifications with respect thereto, shall be filed with the head of
the appointee's agency for permanent retention in the appointee's official
personnel folder or equivalent folder.
Sec. 5. Enforcement. (a) The contractual, fiduciary and ethical commitments
in the pledges provided for herein are enforceable by any legally available
means, including any or all of the following: debarment proceedings within
any affected executive agency or Judicial civil proceedings for declaratory,
injunctive or monetary relief.
(b) Any former senior appointee or trade negotiator who is determined,
after notice and hearing, by the duly designated authority within any agency,
to have violated his or her pledge not to lobby any officer or employee
of that agency, or not to represent, aid or advise a foreign entity specified
in the pledge with the intent to influence the official decision of that
agency, may be barred from lobbying any officer or employee of that agency
for up to five years in addition to the five-year time period covered by
the pledge.
(1) The head of every executive agency shall. in consultation with the
Director of the Office of Government Ethics, establish procedures to imple-
ment the foregoing subsection, which shall conform as nearly as practicable
to the procedures for debarment of former employees found to have violated
section 207 of title 18, United States Code (1988 ed.), set forth in section
2637.212 of title 5, Code of Federal Regulations (revised as of January
1, 1992).
(2) Any person who is debarred from lobbying following an agency proceed-
ing pursuant to the foregoing subsection may seek judicial review of the
administrative determination, which shall be subject to established standards
for judicial review of comparable agency actions.
(c) The Attorney General is authorized:
(1) upon receiving information regarding the possible breach of any com-
mitment in a signed pledge, to request any appropriate federal investigative
authority to conduct such investigations as may be appropriate; and
(2) upon determining that there is a reasonable basis to believe that a
breach of a commitment has occurred or will occur or continue, if not
enjoined, to commence a civil action against the former employee in any
United States District Court with jurisdiction to consider the matter.
(d) In such civil action. the Attorney General is authorized to request any
and all relief authorized by law, including but not limited to:
(1) such temporary restraining orders and preliminary and permanent
injunctions as may be appropriate to restrain future, recurring or continuing
conduct by the former employee in breach of the commitments in the
pledge he or she signed; and
(2) establishment of a constructive trust for the benefit of the United
States, requiring an accounting and payment to the United States Treasury
of all money and other things of value received by, or payable to, the
former employee arising out of any breach or attempted breach of the pledge
signed by the former employee.
5916
Federal Register / Vol. 58, No. 13 / Friday, January 22, 1993 / Presidential Documents
Sec. 6. General Provisions. (a) No prior Executive orders are repealed by
this order. To the extent that this order is inconsistent with any provision
of any prior Executive order, this order shall control.
(b) If any provision of this order or the application of such provision is
held to be invalid, the remainder of this order and other dissimilar applica-
tions of such provisior shall not be affected.
(c) Except as expressly provided in section 5(b)(2) of this order, nothing
in the pledges or in this order is intended to create any right or benefit,
substantive or procedural, enforceable at law by a party against the United
States, its agencies, its officers, or any person.
Wiman Terminer
THE WHITE HOUSE,
January 20, 1993.
(FR Doc. 93-1871
Filed 1-21-93: 12:29 pml
Billing code 3195-01-M
SENIOR APPOINTEE PLEDGE
As a condition, and in consideration, of my employment in the United States Government in a senior
appointee position invested with the public trust, I commit myself to the following obligations, which I
understand are binding on me and are enforceable under law:
1. I will not, within five years after the termination of my employment as a senior appointee in any
executive agency in which I am appointed to serve, lobby any officer or employee of that agency.
2. In the event that I serve as a senior appointee in the Executive Office of the President ("EOP"),
I also will not, within five years after I cease to be a senior appointee in the EOP, lobby any officer or
employee of any other executive agency with respect to which I had personal and substantial responsibility
as a senior appointee in the EOP.
3. I will not, at any time after the termination of my employment in the United States Government,
engage in any activity on behalf of any foreign government or foreign political party which, if undertaken
on January 20, 1993, would require me to register under the Foreign Agents Registration Act of 1938, as
amended.
4. I will not, within five years after termination of my personal and substantial participation in a
trade negotiation, represent, aid or advise any foreign government, foreign political party or foreign
business entity with the intent to influence a decision of any officer or employee of any executive agency,
in carrying out his or her official duties.
5. I acknowledge that the Executive order entitled "Ethics Commitments by Executive Branch
Appointees," issued by the President on January 20, 1993, which I have read before signing this document,
defines certain of the terms applicable to the foregoing obligations and sets forth the methods for enforcing
them. I expressly accept the provisions of that Executive order as a part of this agreement and as binding
on me. I understand that the terms of this pledge are in addition to any statutory or other legal restrictions
applicable to me by virtue of Federal Government service.
, 19
Signature
Date
Print or type your full name (Last, first, middle -- spell out each fully)
Privacy Act Statement
Executive Order 12834 entitled "Ethics Commitments by Executive Branch Appointees," issued by the
President on January 20, 1993 (and published at 58 Federal Register 5911-5916 on 1/22/93), requires every senior
appointee in every executive agency appointed on or after January 20, 1993 to sign this pledge upon becoming a senior
appointee. This pledge establishes a contractual commitment regarding your post-employment activities and your
activities after your personal and substantial participation in a trade negotiation has ceased. If there is a violation
or apparent violation of this pledge, this pledge may be disclosed to the Department of Justice or any other
appropriate Federal agency charged with the responsibility of investigating, prosecuting, enforcing or implementing
the Executive order. Disclosure of this pledge can also be made to another Federal agency, a court or a party in court
litigation or an administrative proceeding when the Government is a party as well as to another Federal agency in
connection with your hiring when the pledge is relevant and necessary thereto. Further, this pledge may be disclosed
to the Executive Office of the President and the Office of Government Ethics to enable them to carry out their
responsibilities under Executive Order 12834 and other ethics oversight authorities. This pledge will be filed for
permanent retention in your official personnel folder or equivalent folder. Your signing this pledge is a condition, and
in consideration, of your employment as a senior appointee, or your receiving a pay raise that will make you a senior
appointee, as defined in the Executive order.
OGE Form 203
Jan. 1993
TRADE NEGOTIATOR PLEDGE
As a condition, and in consideration, of my employment in the United States Government as a trade
negotiator, which is a position invested with the public trust, I commit myself to the following obligations,
which I understand are binding on me and are enforceable under law:
1. I will not, within five years after termination of my personal and substantial participation in a
trade negotiation, represent, aid or advise any foreign government, foreign political party or foreign
business entity with the intent to influence a decision of any officer or employee of any executive agency,
in carrying out his or her official duties.
2. I acknowledge that the Executive order entitled "Ethics Commitments by Executive Branch
Appointees," issued by the President on January 20, 1993, which I have read before signing this document,
defines certain of the terms applicable to the foregoing o! gations and sets forth the methods for enforcing
them. I expressly accept the provisions of that Executive order as a part of this agreement and as binding
on me. I understand that the terms of this pledge are in addition to any statutory or other legal restrictions
applicable to me by virtue of Federal Government service.
, 19
Signature
Date
Print or type your full name (Last, first, middle -- spell out each fully)
Privacy Act Statement
Executive Order 12834 entitled "Ethics Commitments by Executive Branch Appointees," issued by the
President on January 20, 1993 (and published at 58 Federal Register 5911-5916 on 1/22/93), requires every trade
negotiator (who is not a senior appointee) in every executive agency appointed on or after January 20, 1993 to sign
this pledge prior to personally and substantially participating in a trade negotiation. This pledge establishes a
contractual commitment regarding your activities after your personal and substantial participation in a trade
negotiation has ceased. If there is a violation or apparent violation of this pledge, this pledge may be disclosed to the
Department of Justice or any other appropriate Federal agency charged with the responsibility of investigating,
prosecuting, enforcing or implementing the Executive order. Disclosure of this pledge can also be made to another
Federal agency, a court or a party in court litigation or an administrative proceeding when the Government is a party
as well as to another Federal agency in connection with your hiring when the pledge is relevant and necessary thereto.
Further, this pledge may be disclosed to the Executive Office of the President and the Office of Government Ethics
to enable them to carry out their responsibilities under Executive Order 12834 and other ethics oversight authorities.
This pledge will be filed for permanent retention in your official personnel folder or equivalent folder. Your signing
this pledge is a condition, and in consideration, of your employment in the United States Government as a trade
negotiator, as defined in the Executive order.
OGE Form 204
Jan. 1993
Your Executive Branch Agency has ethics counselors.
For further information contact:
Name and Title of Ethics Officials:
Telephone #:
Office Address:
This publication was printed at the UNICOR Print Plant.
Printed on recyled paper.
Federal Correctional Institution. Petersburg, VA
(MAggie Williams)
THE WHITE HOUSE
WASHINGTON
January 21, 1993
MEMORANDUM FOR ALL AGENCY GENERAL COUNSELS AND
WHITE HOUSE OFFICE STAFF
FROM:
BERNARD NUSSBAUM
COUNSEL TO THE PRESIDENT
Bur
SUBJECT
Ethics Commitments By Executive Branch
Appointees
Attached for your information and appropriate action is a
copy of an Executive Order entitled "Ethics Commitments By
Executive Branch Appointees." The order was signed January 20,
1993. The order requires every senior appointee and trade
negotiator in every executive agency appointed on or after
January 20, 1993 to sign a pledge not to engage in certain
post-employment activity.
Section 4 of the order requires each agency to establish
rules or procedures to ensure that each senior appointee and
trade negotiator signs the pledge upon assuming office.
If you have any questions about your responsibilities
under the order, please contact my office.
Attachment
EXECUTIVE ORDER
ETHICS COMMITMENTS BY EXECUTIVE BRANCH APPOINTEES
By the authority vested in me as President of the
United States by the Constitution and laws of the United States
of America, including section 301 of title 3, United States
Code, and sections 3301 and 7301 of title 5, United States Code,
it is hereby ordered as follows:
Section 1. Ethics Pledges. (a) Every senior appointee in
every executive agency appointed on or after January 20, 1993,
shall sign, and upon signing shall be contractually committed
to, the following pledge ("senior appointee pledge") upon
becoming a senior appointee:
"As a condition, and in consideration, of my employment in
the United States Government in a senior appointee position
invested with the public trust, I commit myself to the following
obligations, which I understand are binding on me and are
enforceable under law:
"1. I will not, within five years after the termination of
my employment as a senior appointee in any executive agency in
which I am appointed to serve, lobby any officer or employee of
that agency.
"2. In the event that I serve as a senior appointee in the
Executive Office of the President ('EOP'), I also will not,
within five years after I cease to be a senior appointee in the
EOP, lobby any officer or employee of any other executive agency
with respect to which I had personal and substantial
responsibility as a senior appointee in the EOP.
"3. I will not, at any time after the termination of my
employment in the United States Government, engage in any
activity on behalf of any foreign government or foreign
political party which, if undertaken on January 20, 1993, would
require me to register under the Foreign Agents Registration Act
of 1938, as amended.
2
"4. I will not, within five years after termination of my
personal and substantial participation in a trade negotiation,
represent, aid or advise any foreign government, foreign
political party or foreign business entity with the intent to
influence a decision of any officer or employee of any executive
agency, in carrying out his or her official duties.
"5. I acknowledge that the Executive order entitled
'Ethics Commitments by Executive Branch Appointees,' issued by
the President on January 20, 1993, which I have read before
signing this document, defines certain of the terms applicable
to the foregoing obligations and sets forth the methods for
enforcing them. I expressly accept the provisions of that
Executive order as a part of this agreement and as binding on
me. I understand that the terms of this pledge are in addition
to any statutory or other legal restrictions applicable to me by
virtue of Federal Government service."
(b) Every trade negotiator who is not a senior appointee
and is appointed to a position in an executive agency on or
after January 20, 1993, shall (prior to personally and
substantially participating in a trade negotiation) sign, and
upon signing be contractually committed to, the following pledge
("trade negotiator pledge")
"As a condition, and in consideration, of my employment in
the United States Government as a trade negotiator, which is a
position invested with the public trust, I commit myself to the
following obligations, which I understand are binding on me and
are enforceable under law:
"1. I will not, within five years after termination of my
personal and substantial participation in a trade negotiation,
represent, aid or advise any foreign government, foreign
political party or foreign business entity with the intent to
influence a decision of any officer or employee of any executive
agency, in carrying out his or her official duties.
3
"2. I acknowledge that the Executive order entitled
'Ethics Commitments by Executive Branch Appointees,' issued by
the President on January 20, 1993, which I have read before
signing this document, defines certain of the terms applicable
to the foregoing obligations and sets forth the methods for
enforcing them. I expressly accept the provisions of that
Executive order as a part of this agreement and as binding on
me. I understand that the terms of this pledge are in addition
to any statutory or other legal restrictions applicable to me by
virtue of Federal Government service."
Sec. 2. Definitions. As used herein and in the pledges:
(a) "Senior appointee" means every full-time, non-career
Presidential, Vice-presidential or agency head appointee in an
executive agency whose rate of basic pay is not less than the
rate for level V of the Executive Schedule (5 U.S.C. 5316) but
does not include any person appointed as a member of the senior
foreign service or solely as a uniformed service commissioned
officer.
(b) "Trade negotiator" means a full-time, non-career
Presidential, Vice-presidential or agency head appointee
(whether or not a senior appointee) who personally and
substantially participates in a trade negotiation as an
employee of an executive agency.
(c) "Lobby" means to knowingly communicate to or appear
before any officer or employee of any executive agency on behalf
of another (except the United States) with the intent to
influence official action, except that the term "lobby" does not
include:
(1) communicating or appearing on behalf of and as an
officer or employee of a State or local government or the
government of the District of Columbia, a Native American
tribe or a United States territory or possession;
4
(2) communicating or appearing with regard to a
judicial proceeding, or a criminal or civil law enforcement
inquiry, investigation or proceeding (but not with regard
to an administrative proceeding) or with regard to an
administrative proceeding to the extent that such
communications or appearances are made after the
commencement of and in connection with the conduct or
disposition of a judicial proceeding;
(3) communicating or appearing with regard to any
government grant, contract or similar benefit on behalf of
and as an officer or employee of:
(A) an accredited, degree-granting institution of
higher education, as defined in section 1201 (a) of
title 20, United States Code; or
(B) a hospital; a medical, scientific or
environmental research institution; or a charitable or
educational institution; provided that such entity is
a not-for-profit organization exempted from Federal
income taxes under sections 501 (a) and 501 (c) (3) of
title 26, United States Code;
(4) communicating or appearing on behalf of an
international organization in which the United States
participates, if the Secretary of State certifies in
advance that such activity is in the interest of the
United States;
(5) communicating or appearing solely for the purpose
of furnishing scientific or technological information,
subject to the procedures and conditions applicable under
section 207 (j) (5) of title 18, United States Code; or
(6) giving testimony under oath, subject to the
conditions applicable under section 207 (j) (6) of title 18,
United States Code.
(d) "On behalf of another" means on behalf of a person or
entity other than the individual signing the pledge or his or
her spouse, child or parent.
5
(e) "Administrative proceeding" means any agency process
for rulemaking, adjudication or licensing, as defined in and
governed by the Administrative Procedure Act, as amended
(5 U.S.C. 551, et seq.)
(f) "Executive agency" and "agency" mean "Executive agency"
as defined in section 105 of title 5, United States Code, except
that the term includes the Executive Office of the President,
the United States Postal Service and the Postal Rate Commission
and excludes the General Accounting Office. As used in
paragraph 1 of the senior appointee pledge, "executive agency"
means the entire agency in which the senior appointee is
appointed to serve, except that:
(1) with respect to those senior appointees to whom
such designations are applicable under section 207 (h) of
title 18, United States Code, the term means an agency or
bureau designated by the Director of the Office of
Government Ethics under section 207 (h) as a separate
department or agency at the time the senior appointee
ceased to serve in that department or agency; and
(2) a senior appointee who is detailed from one
executive agency to another for more than sixty days in any
calendar year shall be deemed to be an officer or employee
of both agencies during the period such person is detailed.
(g) "Personal and substantial responsibility" "with respect
to" an executive agency, as used in paragraph 2 of the senior
appointee pledge, means ongoing oversight of, or significant
ongoing decision-making involvement in, the agency's budget,
major programs or personnel actions, when acting both
"personally" and "substantially" (as those terms are defined for
purposes of sections 207 (a) and (b) of title 18, United States
Code).
(h) "Personal and substantial participation" and
"personally and substantially participates" mean acting both
"personally" and "substantially" (as those terms are defined for
6
purposes of sections 207 (a) and (b) of title 18, United States
Code) as an employee through decision, approval, disapproval,
recommendation, the rendering of advice, investigation or other
such action.
(i) "Trade negotiation" means a negotiation that the
President determines to undertake to enter into a trade
agreement with one or more foreign governments, and does not
include any action taken before that determination.
(j) "Foreign Agents Registration Act of 1938, as amended"
means sections 611-621 of title 22, United States Code.
(k) "Foreign government" means "the government of a foreign
country," as defined in section 1 (e) of the Foreign Agents
Registration Act of 1938, as amended (22 U.S.C. 611 (e) )
(1) "Foreign political party" has the same meaning as that
term in section 1(f) of the Foreign Agents Registration Act of
1938, as amended (22 U.S.C. 611(f)) .
(m) "Foreign business entity" means a partnership,
association, corporation, organization or other combination of
persons organized under the laws of or having its principal
place of business in a foreign country.
(n) Terms that are used herein and in the pledges, and also
used in section 207 of title 18, United States Code, shall be
given the same meaning as they have in section 207 and any
implementing regulations issued or to be issued by the Office of
Government Ethics, except to the extent those terms are
otherwise defined in this order.
Sec. 3. Waiver. (a) The President may grant to any
person a waiver of any restrictions contained in the pledge
signed by such person if, and to the extent that, the President
certifies in writing that it is in the public interest to grant
the waiver.
(b) A waiver shall take effect when the certification is
signed by the President.
7
(c) The waiver certification shall be published in the
Federal Register, identifying the name and executive agency
position of the person covered by the waiver and the reasons for
granting it.
(d) A copy of the waiver certification shall be furnished
to the person covered by the waiver and filed with the head of
the agency in which that person is or was appointed to serve.
Sec. 4. Administration. (a) The head of every executive
agency shall establish for that agency such rules or procedures
(conforming as nearly as practicable to the agency's general
ethics rules and procedures, including those relating to
designated agency ethics officers) as are necessary or
appropriate:
(1) to ensure that every senior appointee in the
agency signs the senior appointee pledge upon assuming the
appointed office or otherwise becoming a senior appointee;
(2) to ensure that every trade negotiator in the
agency who is not a senior appointee signs the trade
negotiator pledge prior to personally and substantially
participating in a trade negotiation;
(3) to ensure that no senior appointee or trade
negotiator in the agency personally and substantially
participates in a trade negotiation prior to signing the
pledge; and
(4) generally to ensure compliance with this order
within the agency.
(b) With respect to the Executive Office of the President,
the duties set forth in section 4(a), above, shall be the
responsibility of the White House Counsel or such other official
or officials to whom the President delegates those duties.
(c) The Director of the Office of Government Ethics shall:
(1) subject to the prior approval of the White House
Counsel, develop a form of the pledges to be completed by
senior appointees and trade negotiators and see that the
8
pledges and a copy of this Executive order are made
available for use by agencies in fulfilling their duties
under section 4 (a) above;
(2) in consultation with the Attorney General or White
House Counsel, when appropriate, assist designated agency
ethics officers in providing advice to current or former
senior appointees and trade negotiators regarding the
application of the pledges; and
(3) subject to the prior approval of the White House
Counsel, adopt such rules or procedures (conforming as
nearly as practicable to its generally applicable rules and
procedures) as are necessary or appropriate to carry out
the foregoing responsibilities.
(d) In order to promote clarity and fairness in the
application of paragraph 3 of the senior appointee pledge:
(1) the Attorney General shall, within six months
after the issuance of this order, publish in the Federal
Register a "Statement of Covered Activities," based on the
statute, applicable regulations and published guidelines,
and any other material reflecting the Attorney General's
current interpretation of the law, describing in sufficient
detail to provide adequate guidance the activities on
behalf of a foreign government or foreign political party
which, if undertaken as of January 20, 1993, would require
a person to register as an agent for such foreign
government or political party under the Foreign Agents
Registration Act of 1938, as amended; and
(2) the Attorney General's "Statement of Covered
Activities" shall be presumed to be the definitive
statement of the activities in which the senior appointee
agrees not to engage under paragraph 3 of the pledge.
9
(e) A senior appointee who has signed the senior appointee
pledge is not required to sign the pledge again upon appointment
to a different office, except that a person who has ceased to be
a senior appointee, due to termination of employment in the
executive branch or otherwise, shall sign the senior appointee
pledge prior to thereafter assuming office as a senior
appointee.
(f) A trade negotiator who is not also a senior appointee
and who has once signed the trade negotiator pledge is not
required to sign the pledge again prior to personally and
substantially participating in a subsequent trade negotiation,
except that a person who has ceased employment in the executive
branch shall, after returning to such employment, be obligated
to sign a pledge as provided herein notwithstanding the signing
of any previous pledge.
(g) All pledges signed by senior appointees and trade
negotiators, and all waiver certifications with respect thereto,
shall be filed with the head of the appointee's agency for
permanent retention in the appointee's official personnel folder
or equivalent folder.
Sec. 5. Enforcement. (a). The contractual, fiduciary and
ethical commitments in the pledges provided for herein are
enforceable by any legally available means, including any or all
of the following: debarment proceedings within any affected
executive agency or judicial civil proceedings for declaratory,
injunctive or monetary relief.
(b) Any former senior appointee or trade negotiator who is
determined, after notice and hearing, by the duly designated
authority within any agency, to have violated his or her pledge
not to lobby any officer or employee of that agency, or not to
represent, aid or advise a foreign entity specified in the
pledge with the intent to influence the official decision of
that agency, may be barred from lobbying any officer or employee
10
of that agency for up to five years in addition to the five-year
time period covered by the pledge.
(1) The head of every executive agency shall, in
consultation with the Director of the Office of Government
Ethics, establish procedures to implement the foregoing
subsection, which shall conform as nearly as practicable to
the procedures for debarment of former employees found to
have violated section 207 of title 18, United States Code
(1988 ed.), set forth in section 2637.212 of title 5, Code
of Federal Regulations (revised as of January 1, 1992).
(2) Any person who is debarred from lobbying following
an agency proceeding pursuant to the foregoing subsection
may seek judicial review of the administrative
determination, which shall be subject to established
standards for judicial review of comparable agency actions.
(c) The Attorney General is authorized:
(1) upon receiving information regarding the possible
breach of any commitment in a signed pledge, to request any
appropriate federal investigative authority to conduct such
investigations as may be appropriate; and
(2) upon determining that there is a reasonable basis
to believe that a breach of a commitment has occurred or
will occur or continue, if not enjoined, to commence a
civil action against the former employee in any
United States District Court with jurisdiction to consider
the matter.
(d) In such civil action, the Attorney General is
authorized to request any and all relief authorized by law,
including but not limited to:
(1) such temporary restraining orders and preliminary
and permanent injunctions as may be appropriate to restrain
future, recurring or continuing conduct by the former
employee in breach of the commitments in the pledge he or
she signed; and
11
(2) establishment of a constructive trust for the
benefit of the United States, requiring an accounting and
payment to the United States Treasury of all money and
other things of value received by, or payable to, the
former employee arising out of any breach or attempted
breach of the pledge signed by the former employee.
Sec. 6. General Provisions. (a) No prior Executive orders
are repealed by this order. To the extent that this order is
inconsistent with any provision of any prior Executive order,
this order shall control.
(b) If any provision of this order or the application of
such provision is held to be invalid, the remainder of this
order and other dissimilar applications of such provision shall
not be affected.
(c) Except as expressly provided in section 5 (b) (2) of this
order, nothing in the pledges or in this order is intended to
create any right or benefit, substantive or procedural,
enforceable at law by a party against the United States, its
agencies, its officers, or any person.
Wilman Termina
THE WHITE HOUSE,
January 20, 1993.
STANDARDS OF ETHICAL CONDUCT
FOR EMPLOYEES OF THE
EXECUTIVE BRANCH
Including:
Part I of Executive Order 12674
and
5 C.F.R. Part 2635 Regulation
LINITED STATES OFFICE OF
GOVERNMENT GOV ERNMENT ETHICS
Prepared by:
United States Office of Government Ethics
Suite 500, 1201 New York Avenue, NW.
Washington, DC 20005-3917
August 1992
Clinton Presidential Records
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