Modernization Updates to Standards of Ethical Conduct for Employees of the Executive Branch

Federal RegisterMay 17, 2024

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OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2635

RIN 3209-AA43

Modernization Updates to Standards of Ethical Conduct for Employees of the Executive Branch

AGENCY:

Office of Government Ethics.

ACTION:

Final rule.

SUMMARY:

The U.S. Office of Government Ethics (OGE) is issuing this final rule updating the Standards of Ethical Conduct for Employees of the Executive Branch (Standards). The final rule updates the Standards based on OGE's experience gained from application of the regulation since its inception. The final rule also incorporates past interpretive guidance, adds and updates regulatory examples, improves clarity, updates citations, and makes technical corrections.

DATES:

This final rule is effective August 15, 2024.

FOR FURTHER INFORMATION CONTACT:

Kimberly L. Sikora Panza, Senior Associate Counsel, or Christie Chung, Assistant Counsel, U.S. Office of Government Ethics, 250 E Street SW, Suite 750, Washington, DC 20024-3249; Telephone: 202-482-9300; TTY: 800-877-8339; FAX: 202-482-9237.

SUPPLEMENTARY INFORMATION:

I. Rulemaking History

Pursuant to a provision of the Ethics in Government Act of 1978, 5 U.S.C. 13122, the Director of the U.S. Office of Government Ethics (OGE) is responsible for periodically reviewing, evaluating, and updating the rules and regulations that pertain to ethics in the executive branch. On February 21, 2023 (88 FR 10774), OGE published for public comment a proposed rule setting forth various modernization updates to the Standards of Ethical Conduct for Employees of the Executive Branch (Standards), which serve as the primary regulatory guidance on the standards of ethical conduct for officers and employees of the executive branch of the Federal Government (Government). Prior to publishing the proposed rule, OGE consulted with the Department of Justice and the Office of Personnel Management pursuant to section 201(a) of Executive Order 12674, as modified by Executive Order 12731, and the authorities contained in 5 U.S.C. chapter 131, subchapter II. Additionally, OGE solicited and considered the views of executive branch agency ethics officials. OGE's proposed updates pertained only to subparts A through I of the Standards; separate from the present rulemaking, OGE engaged in a comprehensive rulemaking that added to the Standards new subpart J, which relates to the creation and operation of legal expense funds, and the acceptance of pro bono legal services for certain legal matters. See 88 FR 33799 (May 25, 2023).

The proposed rule provided for a 60-day comment period, which ended on April 24, 2023. During this period, OGE received nineteen responsive comment submissions regarding the proposed rule: fourteen from the public and five from Federal agencies. OGE also received two comment submissions from the public that do not relate to the proposed rule and address unrelated matters. After carefully considering all comments and making appropriate modifications, and for the reasons set forth below and in the preamble to the proposed rule at

https://www.govinfo.gov/content/pkg/FR-2023-02-21/pdf/2023-02440.pdf,

OGE is publishing this final rule.

II. Discussion of Comments and Changes to Proposed Rule

The twenty-one comments that OGE received during the comment period are publicly accessible on OGE's website at this address:

https://www.oge.gov/web/OGE.nsf/All+docs+By+Cat/08C3B547690B7675852589AA00556758.

OGE has reviewed and considered all comments submitted by each commenter. OGE is not addressing the two comments that pertain to matters unrelated to the rulemaking. The following discussion addresses all other comments in the context of the specific subparts or sections to which they relate.

A. General Provisions (Subpart A)

OGE received nine comments from individuals who expressed concerns about the proposed revisions to §§ 2635.101(b)(13) and 2635.106. In §§ 2635.101(b)(13) and 2635.106, OGE proposed to add the words “(including pregnancy, gender identity, and sexual orientation)” after “sex” to reflect protected characteristics identified by the Equal Employment Opportunity Commission (EEOC) as covered by Federal employment discrimination laws. Towards this same end, OGE also proposed adding “genetic information” in these two sections and updating the word “handicap” to “disability.” These commenters specifically criticized the inclusion of “gender identity” and “sexual orientation” in §§ 2635.101(b)(13) and 2635.106; no commenter referenced or objected to the other updates to these provisions relating to pregnancy, genetic information, or disability. Commenters perceived that the inclusion of “gender identity” and “sexual orientation” would result in an expansion of civil rights, and objected to the revisions either categorically or without observance of appropriate protections for religious organizations and religious conscience.

The revisions to §§ 2635.101(b)(13) and 2635.106 do not effectuate any expansion of, or other change to, civil rights laws. Significantly, OGE does not have the authority to promulgate regulations expounding on the scope of categories protected by equal employment laws and regulations, or other civil rights laws and regulations. The updated language merely modernizes the regulatory text to include characteristics that the EEOC already recognizes as protected under the laws enforced by the Commission.

See, e.g., Employees & Applicants,

U.S. Equal Emp. Opportunity Comm'n,

https://www.eeoc.gov/employees

(last visited May 17, 2023). It is both necessary and appropriate that provisions in the Standards that refer to “laws and regulations that provide equal opportunity” list the characteristics protected by Federal laws prohibiting employment discrimination and enforced by the EEOC.

Additionally, OGE received one comment from an individual who expressed concern that the addition of “gender identity” and “sexual orientation” infringes on executive branch employees' First Amendment and other constitutional rights. As noted above, these revisions are merely technical updates referencing types of discrimination already recognized by the EEOC. Acknowledgement of the fact that sex-based discrimination includes gender identity and sexual orientation in §§ 2635.101(b)(13) and 2635.106 neither results in any change to existent equal opportunity laws or regulations, nor impacts the interaction between such laws and the constitutional rights of employees.

For the above reasons and for the reasons stated in the preamble to the proposed rule, OGE therefore is adopting the proposed updates to subpart A without further revisions.

B. Gifts From Outside Sources (Subpart B)

Subpart B Examples

OGE received four suggestions regarding additional examples or clarifications that could be made in subpart B. Specifically, one agency

commenter suggested that OGE add an example of a “non-traditional” prohibited source, such as an entity that enters into a cooperative research and development agreement with a Federal agency, as well as an example involving a lottery ticket as a gift; the same agency suggested that OGE add an example to § 2635.204(d) involving a Department of Defense or other Federal school; and a member of the public suggested that OGE clarify gift acceptance limits and issues relating to entities like the Kennedy Center where events might be hosted by a corporate donor.

The examples requested by these commenters involve illustration of fairly specific situations. It would not be feasible for OGE to provide examples addressing application of the regulation in all of the scenarios that may give rise to subpart B considerations. In light of the extensive revisions made to subpart B in 2016, which included modernization changes and examples, and OGE's determination that the current rule provides appropriate guidance, OGE declines these suggestions.

Gift Exclusion and Exception for “Opportunities and Benefits”

One individual commenter requested that OGE reconcile the difference between the opportunities and benefits excluded from the definition of “gift” in § 2635.203(b)(4) and the opportunities and benefits excepted from the gift prohibitions by § 2635.204(c)(2). Specifically, the commenter noted that the opportunities and benefits excluded from the “gift” definition by § 2635.203(b)(4) include “favorable rates and commercial discounts,” while the opportunities and benefits excepted from the subpart B gift prohibitions by § 2635.204(c)(2) include “favorable rates, commercial discounts, and free attendance or participation.” The “free attendance or participation” language that distinguishes these two provisions was added to § 2635.204(c)(2) when OGE substantially revised subpart B in 2016.

See

81 FR 81641 (Nov. 18, 2016).

OGE notes that the “opportunities and benefits” listed in the § 2635.203(b)(4) gift exclusion are preceded by the word “including,” indicating that the list is not intended to be exhaustive. As such, one could consider free attendance or participation under the gift exclusion, if the appropriate facts presented themselves. However, to clear up any confusion, OGE will add the words “free attendance or participation” to § 2635.203(b)(4) to harmonize the language in §§ 2635.203(b)(4) and 2635.204(c)(2).

Free Attendance Gift Exclusion

Section 2635.203(b)(8) excludes from the definition of “gift” free attendance to an event provided by the sponsor of the event to certain individuals, including an employee who is assigned to present information on behalf of the agency at the event (on any day when the employee is presenting), and “[a]n employee whose presence on any day of the event is deemed to be essential by the agency to the presenting employee's participation in the event,” if the employee is accompanying the presenting employee. One agency opined that it is unclear whether multiple personnel supporting a presenting employee may accept free attendance pursuant to this exclusion. Specifically, the commenter requested that “an employee” in the above-quoted language in § 2635.203(b)(8)(ii) be changed to “any employee” to clarify that multiple supporting personnel may accept free attendance under this exclusion.

OGE notes that it has previously issued guidance making clear that § 2635.203(b)(8)(ii) can be applied to multiple agency personnel.

See

OGE DAEOgram DO-10-003, at 2 (Feb. 18, 2010) (“The number and types of personnel necessary, if any, to the speaker's participation will vary depending upon who the speaker is and the nature of the event.”). Nonetheless, to further address the commenter's concern, OGE is updating example 2 to paragraph (b)(8) to reflect that guidance and eliminate any doubt that multiple supporting personnel may accept free attendance under this exclusion. Specifically, OGE is changing “another employee” to “other employees” and “accompanying employee” to “accompanying employees” in the example.

De Minimis Gift Exception

Three commenters—two individuals and one agency—recommended that OGE increase the monetary thresholds for the

de minimis

gift exception at § 2635.204(a), noting the effects of inflation in the intervening years since the exception was first adopted. Two other commenters made a similar suggestion in 2016 as part of OGE's comprehensive rulemaking revising portions of subpart B.

After carefully considering this recommendation in 2016, OGE noted its concern that “raising the

de minimis

would encourage employees to accept, and private citizens to give, more expensive and more frequent gifts than employees are currently able to accept.” 81 FR 81641, 81645 (Nov. 18, 2016). Although OGE acknowledged at that time—and continues to acknowledge—the effect of inflation on the relative value of the

de minimis

threshold, OGE continues to believe that $20 is a workable amount that serves the narrow purpose of the exception, which is to permit only the infrequent acceptance of inexpensive and innocuous gifts.

Id.; see also

57 FR 35006, 35016 (Aug. 7, 1992). It also continues to be the fact that “no compelling argument has been made to support a conclusion that raising the cap on the blanket

de minimis

exception, in order to allow employees to accept more expensive and more frequent gifts, would strengthen the integrity of the executive branch's operations.” 81 FR 81645.

Independent of these substantive reasons, OGE also declines to adopt the suggestion to increase the

de minimis

threshold in this particular rulemaking, the primary focus of which is on technical, non-substantive updates. OGE does not think it would be appropriate to adjust the § 2635.204(a) dollar value in this final rule without having announced in the proposed rule that it was contemplating such an increase, thereby providing the public an opportunity to reflect on such a proposal and share their input regarding the same.

Widely Attended Gatherings Exception

To improve readability, OGE is making a technical amendment to the structure of § 2635.204(g)(2), which defines when a gathering is widely attended for purposes of the widely attended gathering (WAG) exception. Specifically, OGE is organizing the components of the WAG definition at § 2635.204(g)(2) into new separate paragraphs (g)(2)(i) through (iii). This update involves no substantive changes to the WAG exception.

In response to the proposed rule, one agency recommended removing the requirement in the WAG exception in § 2635.204(g) that an employee attend the event on their own time in their personal capacity rather than in their official capacity. Section 2635.204(g) provides that an employee could attend a qualifying event either on their own time or, if authorized by their agency, on excused absence pursuant to applicable guidelines for granting such absence, or otherwise without charge to the employee's leave account. The commenter questioned the rationale for this requirement that the employee attend on their own time, noting that an agency determination that attendance is in the agency's interest would suggest the event is related to the employee's official duties.

OGE notes that the requirement that the employee attend in their personal capacity is based on appropriations considerations that OGE documented in the preamble to the final rule for 5 CFR part 2635.

See

57 FR 35006, 35019-20 (Aug. 7, 1992). The 1992 preamble explains that the WAG exception was designed to allow agencies that do not have agency gift acceptance authority to permit their employees to accept a gift of free attendance at events in which the agency has an interest in the employee attending. However, due to appropriations requirements, in order for the gift to be accepted by an employee rather than by the agency, the employee must attend the event in their personal capacity “off the clock.” Specifically, this requirement “is imposed of necessity to ensure that the gift is made to the employee rather than to the agency and, thus, that it does not improperly augment agency appropriations available for payment of expenses of attendance at training, meetings or similar events.”

Id.

at 35019. For these reasons, OGE declines to follow the agency's recommendation.

C. Gifts Between Employees (Subpart C)

Gifts to Superiors

One individual commented that the proposed new language in § 2635.302(a)(1), which clarifies that “an official superior may not knowingly accept” an improper gift from a subordinate, is inconsistent with the controlling statutory authority at 5 U.S.C. 7351. The commenter also suggested that the knowledge element in this provision is unclear.

As discussed in the preamble to the proposed rule, the premise that official superiors have a responsibility to not knowingly accept improper gifts from a subordinate is logically consistent with and complements the restrictions articulated in 5 U.S.C. 7351 governing gift giving from a subordinate to a superior. The proposed changes to § 2635.302(a)(1) appropriately emphasize that superiors should not knowingly accept gifts that are improper for employees to give.

Regarding the knowledge element relating to a superior's acceptance of a gift, it is included in recognition of the fact that the regulation covers gifts given “indirectly” by an employee—

e.g.,

ones given by an employee's parent, sibling, spouse, child, or dependent relative with the employee's knowledge and acquiescence.

See

§ 2635.303(b)(1). Section 2635.302(a) is structured in such a way that knowledge is required on the part of both the giver and receiver for indirect gifts. For example, an employee will not be in violation of the rule if their sibling gives a gift to the employee's superior without the employee's knowledge and acquiescence. Similarly, a superior will not be in violation of the rule if they accept a gift that unbeknownst to them was given by the sibling of an employee with the employee's knowledge and acquiescence.

For the reasons explained in the preamble to the proposed rule, OGE declines the commenter's suggestions, and will adopt the revisions to § 2635.302(a)(1) as set forth in the proposed rule.

Gifts From Employees Receiving Less Pay

One individual commenter requested clarification regarding the meaning of “less pay” in § 2635.302(b) and suggested that the rule be amended to specify “base pay.” OGE is unable to adopt this change. The language in § 2635.302(b), referring to “employees receiving less pay” incorporates the language of the underlying statute.

See

5 U.S.C. 7351 (referring to “an employee receiving less pay”). Given this statutory basis, OGE is constrained in its ability to revise the regulation to specify “base pay” or “rate of basic pay.”

Another individual commenter opposed the new language OGE proposed to add to § 2635.302(b)(2), which clarifies that the restriction on accepting a gift from an employee receiving less pay does not apply when the employee giving the gift is the official superior of the employee receiving the gift. The commenter expressed concern that this rule could provide for unequal treatment among the higher paid employees who are now allowed to receive gifts from their superiors, although the commenter also recognized that gifts from superiors to subordinates are not generally restricted by subpart C.

OGE disagrees with the commenter that the updated language is ripe for “favoritism and impropriety.” As a threshold matter, OGE notes that in the status quo, subpart C does not restrict most gifts from superiors to their employees because superiors do not typically receive less pay than their employees. This structure does not seem to have elicited much concern among ethics officials. Furthermore, as OGE noted in the proposed rule, “OGE does not believe that 5 U.S.C. 7351, the statute underlying the restriction articulated in § 2635.302(b), either contemplated or intended that subordinate employees would be restricted from accepting a gift from an official superior who, because of the nature of modern compensation systems, receives less pay.” 88 FR 10774, 10775 (Feb. 21, 2023). Accordingly, this updated language that permits all employees to receive gifts from their superiors in the same manner is necessary to modernize and equalize the rule given the situations in the current Federal pay system in which a subordinate may earn more than their official superior. However, it does not encourage the provision of such gifts in an unfair or inequitable manner.

De Minimis Gift Exception

Similar to the related suggestions regarding the subpart B

de minimis

exception, two agency commenters recommended that OGE increase the monetary threshold in the gift exception at § 2635.304(a). As is the case with the

de minimis

exception in § 2635.204(a), OGE believes that the current value of the

de minimis

exception in subpart C should remain unchanged. As OGE noted when issuing the Standards, while it is “appropriate to permit modest exchanges of gifts between coworkers,” it is important to remain mindful of “subtle pressures to give gifts to superiors” in an environment “where superiors and subordinates interact daily and where subordinates compete for advancement.” 57 FR 35006, 35022 (Aug. 7, 1992). Notwithstanding inflation, OGE believes that the $10 amount remains adequate to permit an exchange of a modest token between employees and is “low enough generally to discourage employees from purchasing gifts for their superiors.”

Id.

OGE further echoes its concern noted above about adjusting a

de minimis

value in this final rule when the public was not apprised of such a potential change or given the opportunity to comment on it.

Special Infrequent Occasions Exception

One agency commenter suggested that OGE add a new example to the exception for special, infrequently occurring occasions to illustrate that a superior's promotion is not an occasion of personal significance. OGE declines to adopt this suggestion. Example 3 to the exception for voluntary contributions in § 2635.304(c) sufficiently illustrates that a superior's promotion within the supervisory chain is not an appropriate time for subordinates to take up a collection for a gift to that official superior because the occasion does not “mark the termination of the subordinate-official superior relationship, nor [is it an] event[ ] of personal significance within the meaning of [§ 2635.304(b)].”

An individual commenter suggested that OGE consider adding “divorce” to the non-exhaustive list of special, infrequent occasions covered by the exception at § 2635.304(b)(1), and also suggested that OGE could add further detail in the regulation regarding the application of this exception in other contexts, such as traditional religious or cultural rites of passage.

OGE notes that the statute authorizing OGE to issue regulations exempting certain gifts contemplates that OGE may exempt gifts in circumstances “in which gifts are traditionally given or exchanged.” 5 U.S.C. 7351(c). The list of special, infrequent occasions provided in the regulation is not exhaustive, as it is preceded by the phrase “such as.” OGE does not endeavor to attempt to list all occasions that may be covered in the regulation, nor does it believe it would be prudent or practicable to articulate every such occasion. The language of the exception makes clear that the exception allows for gifts that are “infrequently occurring occasions of personal significance,” and this language should be applied when considering occasions not included in the non-exhaustive list.

Regarding this same exception, a different individual commenter agreed that adding “bereavement” to § 2635.304(b) is a beneficial change; the individual suggested, however, that there are issues in practice with OGE's inclusion of this term without limitation. Specifically, the commenter recommended that OGE establish “limitations as to which family members the exception applies.” OGE declines to adopt language qualifying which bereavements constitute an infrequently occurring occasion of personal significance, believing that it is neither appropriate nor wise to make a categorical determination about which losses justify expressions of sympathy. OGE notes that a gift in recognition of bereavement must still be “appropriate to the occasion,” which is a sufficient limiting factor that appropriately curtails gift giving and acceptance in the bereavement context and addresses any potential for misuse of the narrow exception at § 2635.304(b).

This same commenter recommended that OGE add birthdays ending in zero to the non-exhaustive list of special, infrequent occasions covered by § 2635.304(b)(1). Drawing parallels between birthdays ending in zero and occasions enumerated in the regulation, the individual commented that exclusion of milestone birthdays is arbitrary. OGE believes that it would be inappropriate to except gifts in connection with birthdays, which includes milestone birthdays, from the general rules governing gifts between employees, and thus did not revise the regulation to indicate otherwise. As noted in the preamble accompanying the proposed rule, OGE does not consider milestone birthdays to be infrequently occurring occasions of the sort warranting exception under § 2635.304(b). Of course, it may be possible to give a gift in recognition of any birthday under another exception, such as the exception for gifts with a value of $10 or less and the exception for food and refreshments shared in the office among several employees.

See

§ 2635.304(a)(1) and (2).

Exception for Voluntary Contributions of Nominal Amounts

One individual commenter suggested that OGE define the term “nominal” as it is used in the exception at § 2635.304(c) for “voluntary contributions of nominal amounts from fellow employees for an appropriate gift to an official superior.” OGE appreciates this suggestion, but has not made a change to the regulation. What constitutes a “nominal” amount is necessarily context-specific, for example, depending on whether the contribution is for items like food and refreshments, or for a gift in recognition of a special, infrequent occasion. In response to a similar comment when first issuing the Standards, OGE explained that it chose to not impose a specific dollar limit, even though collections for gifts generally involve individual contributions less than five dollars. In doing so, OGE noted that “[w]here contributions meet the regulatory requirement that they be entirely voluntary, higher amounts may appropriately be contributed in some cases, as when several senior members of an office provide an additional contribution to subsidize a collection that has come up short of sufficient funds to purchase a desired gift.” 57 FR 35006, 35023 (Aug. 7, 1992). The regulation makes clear that the contributions must be for “an appropriate gift,” which OGE believes provides a suitable, non-monetary limit on the use of this exception.

Disposition of Prohibited Gifts

One agency commenter suggested that OGE add a section in this subpart that addresses what an employee should do if they inadvertently accept a gift that is not permissible under this subpart. In response to agency inquiries regarding the disposition of gifts prohibited by subpart C, OGE has advised that agencies are free to look to the subpart B disposition provisions for guidance regarding how to handle such gifts. To provide greater clarity to employees and ethics officials, OGE will add a new § 2635.305 to subpart C that is consistent with that guidance.

D. Conflicting Financial Interests (Subpart D)

Analyzing Imputed Interests and Multi-Entity Organizations

One agency commenter requested that OGE add an example in § 2635.402 illustrating the application of 18 U.S.C. 208 where an employee has an imputed financial interest by virtue of their outside employment or position with an organization, and there is a particular matter that could affect one of the entity's campuses, or a parent, affiliate, or subsidiary organization. OGE declines to add such an example. As a threshold matter, OGE notes that the Standards already provide clear guidance regarding how imputed relationships are analyzed. Specifically, § 2635.402(b)(2) explains that “[f]or purposes of 18 U.S.C. 208(a) and this subpart, the financial interests of [certain imputed persons, including an organization or entity with which an employee serves as officer, director, trustee, general partner or employee] will require the recusal of an employee

to the same extent as if they were the employee's own interests.

” (Emphasis added.) Regarding related entities such as parents, subsidiaries, affiliates, etc., the Standards generally acknowledge the potential conflicts that may arise with respect to the same.

See

note 2 to § 2635.402(b)(1) (recognizing that a party matter may have a direct and predictable effect on an employee's financial interest in an affiliate, parent, or subsidiary of that party). Ultimately, however, OGE is wary of potential misinterpretation and misapplication were it to include an example of the sort requested by this commenter, and believes that a Legal Advisory is a more suitable means through which to provide guidance on the appropriate analysis.

Example 1 to § 2635.403(b)

One individual commenter questioned OGE's proposed inclusion of a dollar amount in example 1 to § 2635.403(b) and suggested that the value should be removed because it “is not . . . important for the rule's applicability.” OGE intends to retain the dollar amount in this example. As explained in the preamble to the proposed rule, OGE proposed adding a specific dollar figure to the amount of stock owned by the employee in the example “to make clear that the

minimis

regulatory exemption in 5 CFR 2640.202 does not apply in this scenario.” Accordingly, as noted in the example, the agency could determine that “the employee could not, by virtue of 18 U.S.C. 208(a), perform these significant duties of the position while retaining stock in the company.”

Definition of Financial Interest

The same individual commenter questioned OGE's proposed update to the definition of “financial interest” in 5 CFR 2635.403(c)(1), which replaces the word “dependent child” with “minor child,” and expressed a preference for retaining “dependent child.” As stated in the language of § 2635.401 that this rulemaking will adopt, subpart D “summarizes the relevant statutory restrictions [of 18 U.S.C. 208] and some of the regulatory guidance found” in 5 CFR part 2640, the part interpreting and implementing 18 U.S.C. 208. The updated language referencing “minor child” brings § 2635.403(c)(1) into alignment with the language used throughout subpart D, and reflects the terminology of the statute proper and its implementing regulation. Therefore, OGE declines to retain the “dependent child” language in § 2635.403(c)(1) or otherwise integrate the concept of “dependent child” in this subpart.

E. Impartiality in Performing Official Duties (Subpart E)

Subpart E Examples

OGE received one comment from an individual concerning the application of § 2635.502 to particular matters of general applicability and requesting the addition of an example illustrating that application. As proposed, reorganized § 2635.502 articulates the operation of the regulation with respect to particular matters involving specific parties in which a household member has a financial interest, and particular matters involving specific parties in which someone with whom one has a covered relationship is or represents a party. Section 2635.502(a)(3) makes clear that employees who are concerned about impartiality questions arising from circumstances other than the party matters described in the preceding sentence—which could include particular matters of general applicability—should utilize the process detailed in the regulation, including in paragraph (d), to determine whether their participation is appropriate. In 1991, OGE addressed this “catch-all” provision in the preamble to the proposed rulemaking for the Standards, explaining that although the section focused on specified relationships and party matters, questions about an employee's impartiality could arise from any number of interests or relationships they might have, and in connection with their participation in matters that do not necessarily involve specific parties. 56 FR 33778, 33786 (July 23, 1991). For this reason, § 2635.502 “therefore provides that an employee should use the process set forth in that section when circumstances other than those specifically described raise questions about [their] impartiality in the performance of official duties.” Id. Given this guidance, OGE declines to add an example illustrating the specific application of § 2635.502 to particular matters of general applicability.

For similar reasons, OGE declines to add a very fact-specific example suggested by a different individual regarding how previous litigation history between an employee and party to a matter might give rise to impartiality concerns.

Employee Work Assignments

OGE received two comments from the public expressing concern that the new note at § 2635.501 could be viewed as being in conflict with, or causing confusion regarding, regulatory language in §§ 2635.105(a) and 2638.602 regarding how supplemental agency ethics regulations require OGE's concurrence, with co-signature and publication by the agency and OGE. One commenter questioned whether the intent of the note was to indicate that agencies have unfettered authority to assign work as they see fit, and whether a manager's delegation of work based on ethics considerations would be contrary to § 2635.105 if not subject to OGE review. The second commenter asked OGE to make clear what triggers the requirement to memorialize an ethics requirement in a supplemental regulation versus merely issuing an agency policy.

As discussed in the preamble to the proposed rule, the note is not an independent source of authority; it simply reminds agency ethics officials that supervisors generally have broad discretion when assigning work to employees and that there may be a multitude of factors considered by a supervisor in doing so, including appearance or impartiality concerns that do not fit squarely within the Standards. OGE has no intention to alter the requirements relating to supplemental ethics regulations, nor could it do so in this rulemaking, as those general requirements are established by Executive order.

See

E.O. 12731, sec. 301(a) (Oct. 17, 1990). Agencies wishing to supplement the Standards with additional ethics obligations still must follow the requirements of § 2635.105, as referenced in § 2638.602, and may rely on prior OGE guidance regarding what agency ethics policies belong in a supplemental regulation.

See, e.g.,

OGE Legal Advisory LA-11-07 (Oct. 31, 2011).

Covered Relationship Stemming From Certain Familial Relations

One individual commenter stated their support for the removal of the “dependent” qualifier when discussing covered relationships relating to certain business activities of children, noting that “[a] non-dependent child is more likely to have relationships that implicate impartiality concerns than dependent children, who, being dependents as defined at 26 U.S.C. 152 (

e.g.,

minors or students), are relatively unlikely to have the sorts of business relationships raising those concerns.” An agency commenter disagreed with OGE's proposal to remove the “dependent” qualifier, suggesting that the financial co-dependence of parents and dependent children is more likely to raise concerns regarding impartiality.

OGE will adopt as final the change removing the “dependent” qualifier before “child” in § 2635.502(b)(1)(iii). This change appropriately reflects that there are potential impartiality concerns relating to certain business relations of a child regardless of that child's dependency, just as long-established language in § 2635.502(b)(1)(iii) acknowledges impartiality concerns relating to certain business relations of a parent, without any dependency predicate. The updated language harmonizes the treatment of parents and children for purposes of the scope of certain covered relationships because both familial relations may raise similar ethics concerns, irrespective of any financial connection or perceived financial impact. In that regard, OGE notes that nothing in subpart E contemplates that there need be a perceived impact on an employee's financial interests for there to be concerns about their impartiality, and that many of the long-established covered relationships articulated in § 2635.502(b) would not seem to involve such a perceived impact. Of course, we note that § 2635.502 does not demand a specific outcome regarding participation when an appearance concern arises; it merely requires that employees engage in the appropriate analysis under this subpart before participating. As we stated in the 1992 preamble to the final rule for the Standards, “the importance of relevant facts must be emphasized.”

57 FR 35006, 35027 (Aug. 7, 1992). To highlight this point as applied to the revised covered relationship provision, OGE is updating new example 6 to § 2635.502(b) so that the scenario described involves the employment relationship of an adult child. This example now illustrates a situation where a covered relationship described in paragraph (b)(1)(iii) exists—a covered relationship with the employer of an employee's adult child—but the employee could justifiably conclude that a reasonable person would not be likely to question their impartiality in participating in a party matter involving the child's employer.

Covered Payments and Qualifying Programs

OGE received one comment from an agency regarding the proposed update to the definition of a “qualifying program” at § 2635.503(b)(2), which requires that the written program “not treat individuals entering Government service more favorably than other individuals.” The commenter noted that this language covers the types of commonly written policies that permit for the acceleration of benefits or lump sum payouts for individuals entering Government service, which can expedite the transition to Government service, and expressed concern that this change would cause unnecessary delays and conflicts in that transition.

OGE notes that the updated language in § 2635.503(b)(2) does not affect OGE's position that “when the ownership of the interest has already vested[,] an employee may receive an earlier payment to remediate a conflict of interest without running afoul of either 18 U.S.C. 209 or 5 CFR 2635.503. This is because the employee is entitled to receive the payment and only the timing is being altered, not the entitlement to the payment itself.” U.S. Off. of Gov't Ethics, Conflicts of Interest Considerations: Corporate Employment 5 (2021),

https://www.oge.gov/web/OGE.nsf/0/EC83872D932E6DCE852585B6005A1F8C/$FILE/Corporate%20Employment.pdf.

Accordingly, if an employee receives accelerated payment of an already vested equity interest, that payment still would not implicate § 2635.503.

Regarding the revisions to the definition of “qualifying program,” which OGE will adopt as proposed, OGE has noted an increase in written policies and programs favoring Government employees, which OGE did not anticipate when it first promulgated § 2635.503. OGE therefore intentionally updated the definition of “qualifying program” to exclude written plans and programs that provide favorable treatment to employees entering Government service, such as accelerated vesting of employment-related interests. This approach is consistent with how OGE has viewed unwritten practices of treating employees entering Government more favorably. Whether made pursuant to a program or a practice, a covered payment received from a former employer raises “a legitimate concern, and thus an appearance, that the employee may not act impartially in particular matters to which the former employer is a party or represents a party.” 56 FR 33778, 33786 (July 23, 1991). OGE does not have any indication that this modernized regulation, which is focused on an employee's recusal obligation once serving the Government, would cause unnecessary delays and conflicts during the transition into Federal service.

Inclusion of Former Clients in the Former Employer Definition

The same agency requested that OGE revise note 1 to paragraph (b)(3) in § 2635.503 to “clarify that former clients are those for whom the individual personally provided services, and not all clients of a larger firm.” Note 1 states that the “former employer” definition “includes former clients

for whom an employee may have served

as an agent, attorney, consultant, or contractor.” (Emphasis added.) OGE believes that the Note is clear on its face that the term “former clients” refers to those for whom the employee personally provided services, and thus will adopt the proposed language without amendment.

F. Seeking Other Employment (Subpart F)

Subpart F Examples

OGE received one comment from an individual requesting an additional example in subpart F to clarify whether an employee may rely on third-party information to conclude that a prospective employer has rejected the possibility of hiring the employee. Specifically, the commenter suggested an example where an employee learns from a third party that they are no longer under consideration—for example, because the position has been filled by someone else. OGE declines to make this change for several reasons. First, OGE in 2016 published substantive updates to subpart F, which included several new examples to illustrate the application of subpart F to modern job searches. This rulemaking is only proposing global technical changes throughout subpart F, which is consistent with the purpose of the modernization project. Second, OGE notes that the legitimacy of the information received from third parties is likely to vary significantly on a case-by-case basis. As such, an example involving information from a third party would be unlikely to provide helpful insight—and worse, could be misconstrued to imply that all third-party information can be relied upon in the same way. Finally, OGE believes the current structure of subpart F provides sufficient guidance to assess scenarios where the employee receives credible information that the prospective employer has rejected the possibility of employment.

Seeking Employment Definition

This same individual asserted that the definitions in subpart F do not take into consideration the possibility that an employee might seek employment by posting their interest on social media or meeting with a recruiter who will communicate with multiple, potentially unknown, companies. OGE disagrees with this commenter. As part of the 2016 updates to subpart F, OGE modernized the rule and added three new examples of seeking employment involving social media. OGE added these examples to “clarify that the rules in this subpart apply regardless of the method the employee uses when seeking employment.” 81 FR 8008, 8009 (Feb. 17, 2016). As further discussed in the 2016 preamble, the examples illustrate that the posting of a profile, resume, or other employment information that is not targeted to a specific person is not considered an unsolicited communication with an entity regarding possible employment; instead such a posting is akin to posting a resume on a bulletin board. Moreover, if the employee is using an agent or other intermediary when seeking employment, the definition of “prospective employer” is met only “if the agent identifies the prospective employer to the employee.” 5 CFR 2635.603(c)(1) and (2) and example 2 to paragraph (c) (discussing a scenario involving an online resume distribution service that sends resumes to recruiters). Accordingly, OGE is declining to make further updates.

This individual also suggested that OGE shorten the two-month timeframe in § 2635.603(b)(2)(ii), which provides that, in the absence of a response from a prospective employer indicating interest, an employee is no longer seeking employment—and thus no longer has a recusal requirement under subpart F—after two months have elapsed from their dispatch of an

unsolicited resume or job proposal. The commenter recommended truncating this timeframe given changes in the mechanisms through which individuals search for jobs, and potentially quicker responses from prospective employers than was the case in years past.

The provision about which this commenter is providing input was substantively unchanged by the proposed rule, which noted that OGE endeavors to make only global technical changes to subpart F that are proposed throughout the Standards. OGE does not believe that the two-month period prescribed in § 2635.603(b)(2)(ii) is an unreasonably excessive period of time in the modern job market. Even with the technologies of current day, OGE continues to view two months as a realistic period of time within which an individual may expect a response to an unsolicited resume or job proposal. Subpart F addresses lack of impartiality concerns warranting recusal from particular matters affecting the financial interests of a prospective employer with whom the employee is seeking employment. In weighing this comment against the concerns underpinning subpart F, OGE is not inclined to relax the recusal requirement in the manner suggested. Moreover, we note, as we did in 1992 when issuing the final rule establishing the Standards, “that the two-month period establishes an outside limit. An earlier response from the recipient indicating no interest in pursuing the matter further will terminate the employee's disqualification at that time.” 57 FR 35006, 35029 (Aug. 7, 1992). Thus, to the extent that the timeframe in “which an applicant will hear back from a prospective employer” is shorter, as suggested by the commenter, an employee who receives a negative response will be relieved of their subpart F recusal obligation at that point.

G. Misuse of Position (Subpart G)

Letters of Recommendation

OGE received multiple comments relating to § 2635.702(b), a section in which OGE did not propose any substantive changes. One agency commenter recommended that OGE add an additional example to § 2635.702(b) to illustrate that an employee may use their official title in connection with providing a recommendation for an individual with whom they have dealt in the course of Federal employment outside of the executive branch—for example, an individual with whom the employee worked while assigned to a Congressional office. OGE declines to adopt this suggestion, as it considers the language in § 2635.702(b) to be sufficiently clear in its broad phrasing that an employee's official title may be used in connection with a reference for an individual with whom the employee has dealt not just in connection with executive branch employment, but “in the course of Federal employment.”

A different agency requested that the last sentence of § 2635.702(b) be updated such that employees may recommend individuals using their official title not just for Federal employment, but also for other opportunities such as Federal internships or educational programs. OGE believes that § 2635.702(b) appropriately permits recommendations for Federal employment, and declines to expand the regulatory language as suggested by the commenter to cover other Federally associated opportunities. As a point of clarification, however, OGE notes that some internships and positions associated with a Federal entity may qualify as “Federal employment,”

see, e.g.,

OGE Legal Advisory LA-17-09 (Aug. 14, 2017) (discussing different hiring authorities for and employment status of student interns), such that it would be permissible under § 2635.702(b) for an employee to use their official title to recommend an individual for the same.

The same agency expressed concern that example 1 to § 2635.702(b) suggests that “it is entirely acceptable for an employee to recommend a person for Federal employment (including use of the employee's title and official letterhead) solely because the person is a personal friend.” As a threshold matter, OGE notes it did not propose to substantively update this example in this rulemaking. Furthermore, the example is consistent with § 2635.702(b), which specifically permits an employee to use their official title to recommend individuals for Federal employment, including personal friends. As explained in the preamble to the final rule establishing the Standards, OGE believes that recommending an individual for Federal employment serves an “official purpose” that justifies the use of official title.

See

57 FR 35006, 35031 (Aug. 7, 1992).

Personal Social Media and Use of Official Photographs

As discussed in the proposed rulemaking, OGE is adding a new example of an appearance of governmental sanction following § 2635.702(b), which involves the use of personal social media by an Environmental Protection Agency (EPA) employee. The example is consistent with OGE's Legal Advisory on personal social media use and illustrates the factual determination that agency ethics officials must make in evaluating whether a reference to an employee's official title or position on social media violates the Standards.

See

OGE Legal Advisory LA-15-03 (Apr. 9, 2015). In particular, the example notes that while certain facts alone—such as listing the employee's Government title under the “occupation” section of their personal social media account—would not reasonably be construed as implying governmental sanction or endorsement, it would be problematic if the EPA employee prominently featured the agency's seal on their social media account and made statements asserting or implying that their opinions on environmental topics are sanctioned or endorsed by the Government.

One agency commenter recommended updating this example to address the use of an official Government photograph on personal social media. Official photographs, displays including official uniform or insignia, and use of agency seals must be consistent with all applicable statutes, regulations, and agency policies, including the Standards. Employees who choose to display official pictures or include photographs of themselves wearing agency uniform or insignia should be mindful that doing so can increase the possibility of confusion as to whether their social media account and content on that account are official or personal; a prominent disclaimer clarifying that all content is personal can help obviate such confusion. However, OGE declines to update the example to discuss the use of an official photograph on a personal social media account. Although the new example provides an illustration of how personal social media use might implicate ethics rules regarding misuse of position, it is not intended to be exhaustive of the myriad ways that employees might engage or post on their personal social media accounts. Given the nuance of these issues, OGE believes that this topic is best addressed through interpretive guidance, and notes that it recently issued a Legal Advisory discussing the application of ethics rules to employees' activities on personal social media accounts, including the use of official photographs.

See

OGE Legal Advisory LA-23-13, at 2-3 (Sept. 28, 2023) (discussing the question “Can I use my official picture or a picture of me at a work event as my profile picture [on social media]?”).

Acceptable Personal Use of Government Resources

As explained in the preamble to the proposed rule, OGE proposed replacing example 1 following § 2635.704(b)—which discussed a General Services Administration (GSA) regulation that no longer exists—with an example that references an agency's

de minimis

policy relating to the personal use of a Government email account. In response to this change, one individual commenter requested that OGE provide more guidance on acceptable personal use of Government resources, given the absence of a GSA regulation and significant technological changes in recent years. OGE believes the Standards and examples set forth and revised in § 2635.704 are sufficiently clear and can be applied to Government property as it continues to evolve with technological advances. Furthermore, more specific guidelines about current technology than what is already in § 2635.704 and its examples would run the risk of quickly becoming outdated. Finally, OGE notes that agencies have established more specific policies regarding acceptable limited personal use of Government resources by their employees, and employees' adherence to these policies would constitute an authorized use of Government resources.

See

OGE Inf. Adv. Op. 97x3 (Mar. 21, 1997). OGE defers to agencies to interpret such policies and to determine whether specific instances of personal use would amount to a misuse of Government resources.

H. Outside Activities (Subpart H)

Teaching, Speaking, and Writing

One individual provided comments regarding OGE's proposed ministerial change to § 2635.807(a), which emphasizes the timing aspect that an employee “may not receive compensation from any source other than the Government for teaching, speaking, or writing that occurs

while the person is a Government employee and that relates to the employee's official duties.”

(Emphasis added.) The commenter incorrectly suggests that the updated language provides for a “looser standard” than set forth in the original rule; specifically, the commenter stated that before this change, § 2635.807 had a “broader application . . . [that] prevents former employees from gaining, after the fact from” their official duties and that the new language would “lessen the broad application and lift the restrictions as they would apply to former employees.”

As a threshold matter, OGE reiterates that the Standards, including subpart H, apply only to current executive branch employees. More specifically regarding teaching, speaking, and writing covered by § 2635.807, OGE has been unequivocal in its guidance that “ethics rules do not restrict receipt of compensation unless the writing occurs during Government service.” OGE DAEOgram DO-08-006, pt. I, at 8 (Mar. 6, 2008);

see also

OGE Legal Advisory LA-14-08, at 2 (Nov. 19, 2014) (stressing the importance of considering the totality of circumstances in connection with use of title in other outside activities, such as involvement with a professional society, to determine whether a reasonable person could construe the reference to imply sanction or endorsement of the organization or the employee's personal activities). Because OGE believes that subparts G and H and the further guidance on those provisions provide appropriate flexibility regarding use of title and sufficiently address the commenter's concerns, OGE declines to make the commenter's recommended change.

Fundraising

The same agency recommended that OGE amend the definition of “participation in the conduct of an event” at § 2635.808(a)(2) to clarify that the term includes presenting awards and being present on stage during the presentation of awards. OGE declines to adopt these changes given that the list of examples to which the commenter suggests adding is not intended to be exhaustive. Additionally, it is OGE's belief that the current language provides sufficient guidance for practical application of the regulation by ethics officials and employees, without being unnecessarily proscriptive regarding the necessarily fact-specific application of this provision.

The same agency also requested certain clarifications in the new social media examples added to § 2635.808(c) relating to fundraising in a personal capacity. In particular, the commenter suggested updating example 5 to note that the employee's “personal solicitation” could be sent by either official or personal email, and suggested updating example 6 to note that “any person” includes subordinates. OGE believes that the cited examples are appropriately specific, and therefore declines to incorporate these changes. Specifically, the general reference to an email transmission in example 5 does not suggest that such a transmission need be sent by either a personal or an official email to be problematic. Similarly, the reference to “any person” in example 6 is appropriately broad such that it could include a subordinate.

I. Other

Incorporation of Obligations From Ethics Pledges

One individual commenter recommended that OGE implement certain core provisions of recent Presidential ethics pledges that impose additional obligations on certain noncareer employees.

See, e.g.,

E.O. 13490 (Jan. 21, 2009); E.O. 13770 (Jan. 28, 2017); E.O. 13989 (Jan. 20, 2021). OGE declines to make such a change, which is outside the scope of the modernization updates contemplated by this rulemaking, and about which public input was requested. OGE further notes that it is the prerogative of each Presidential administration to determine what, if any, additional ethics obligations it wishes to impose on its appointees, and that it would not be appropriate for OGE to implement such obligations in a regulation that by design is intended to extend across multiple administrations.

Subpart J

As discussed above, OGE recently engaged in a separate rulemaking process that culminated in the addition of subpart J to the Standards. This rulemaking makes no changes to subpart J, and revises and republishes only subparts A through I of the Standards.

III. Matters of Regulatory Procedure

Regulatory Flexibility Act

As Acting Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this final rule will not have a significant economic impact on a substantial number of small entities because it primarily affects current Federal executive branch employees.

Paperwork Reduction Act

The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because this regulation does not contain information collection requirements that require approval of the Office of Management and Budget.

Unfunded Mandates Reform Act

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 25, subchapter II), this final rule will not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and Tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation) in any one year.

Executive Orders 12866, 13563, and 14094

In promulgating this rule, the Office of Government Ethics has adhered to the regulatory philosophy and the applicable principles of regulation set forth in Executive Order 12866, Regulatory Planning and Review (58 FR 51735, Oct. 4, 1993); Executive Order 13563, Improving Regulation and Regulatory Review (76 FR 3821, Jan. 21, 2011); and Executive Order 14094, Modernizing Regulatory Review (88 FR 21879, Apr. 11, 2023). Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select the regulatory approaches that maximize net benefits (including economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.

Although the number of substantive changes to the regulation is not extensive, the benefits of implementing these changes are significant. The existing regulation is not insufficient, but it has not been significantly updated since its issuance in 1992. OGE's revisions address common questions received from ethics officials, incorporate OGE's experience gained from applying the regulation since its inception, modernize existing examples and add new examples for more useful reference, provide updated citations where regulatory provisions or statutes have changed, and make technical corrections. These revisions will provide greater clarity for executive branch employees and ethics officials. Further, OGE anticipates that this additional clarity will increase compliance and reduce the number of inadvertent violations.

OGE does not anticipate any significant increased costs associated with these changes. However, OGE notes that there may be an increase in the time burden during the first year in which the regulatory updates become effective, particularly for ethics officials, due to necessary updates to training materials and other related ethics briefings, questions regarding the interpretation of revised regulatory provisions, and review of additional OGE guidance.

This rule has been designated as a “significant regulatory action” under Executive Order 12866, although not significant under section 3(f)(1) of Executive Order 12866. Accordingly, this rule has been reviewed by the Office of Management and Budget.

Executive Order 12988

As Acting Director of the Office of Government Ethics, I have reviewed this rule in light of section 3 of Executive Order 12988, Civil Justice Reform, and certify that it meets the applicable standards provided therein.

Executive Order 13175

The Office of Government Ethics has evaluated this final rule under the criteria set forth in Executive Order 13175 and determined that Tribal consultation is not required as this final rule has no substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

List of Subjects in 5 CFR Part 2635

Conflict of interests, Executive branch standards of ethical conduct, Government employees.

Approved: May 8, 2024

Shelley K. Finlayson,

Acting Director, U.S. Office of Government Ethics.

For the reasons set forth in the preamble, the U.S. Office of Government Ethics amends 5 CFR part 2635 as follows:

PART 2635—STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE EXECUTIVE BRANCH

1. The authority citation for part 2635 is revised to read as follows:

Authority:

5 U.S.C. 7301, 7351, 7353; 5 U.S.C. ch. 131; E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306.

2. Revise and republish subparts A through I to read as follows:

Subpart A—General Provisions

Sec.

2635.101

Basic obligation of public service.

2635.102

Definitions.

2635.103

Applicability to enlisted members of the uniformed services.

2635.104

Applicability to employees on detail.

2635.105

Supplemental agency regulations.

2635.106

Disciplinary and corrective action.

2635.107

Ethics advice.

Subpart B—Gifts From Outside Sources

2635.201

Overview and considerations for declining otherwise permissible gifts.

2635.202

General prohibition on solicitation or acceptance of gifts.

2635.203

Definitions.

2635.204

Exceptions to the prohibition for acceptance of certain gifts.

2635.205

Limitations on use of exceptions.

2635.206

Proper disposition of prohibited gifts.

Subpart C—Gifts Between Employees

2635.301

Overview.

2635.302

General standards.

2635.303

Definitions.

2635.304

Exceptions.

2635.305

Disposition of prohibited gifts.

Subpart D—Conflicting Financial Interests

2635.401

Overview.

2635.402

Disqualifying financial interests.

2635.403

Prohibited financial interests.

Subpart E—Impartiality in Performing Official Duties

2635.501

Overview.

2635.502

Personal and business relationships.

2635.503

Covered payments from former employers.

Subpart F—Seeking Other Employment

2635.601

Overview.

2635.602

Applicability and related considerations.

2635.603

Definitions.

2635.604

Recusal while seeking employment.

2635.605

Waiver or authorization permitting participation while seeking employment.

2635.606

Recusal based on an arrangement concerning prospective employment or otherwise after negotiations.

2635.607

Notification requirements for public financial disclosure report filers regarding negotiations for or agreement of future employment or compensation.

Subpart G—Misuse of Position

2635.701

Overview.

2635.702

Use of public office for private gain.

2635.703

Use of nonpublic information.

2635.704

Use of Government property.

2635.705

Use of official time.

Subpart H—Outside Activities

2635.801

Overview.

2635.802

Conflicting outside employment and activities.

2635.803

Prior approval for outside employment and activities.

2635.804

Outside earned income limitations applicable to certain Presidential appointees.

2635.805

Service as an expert witness.

2635.806

[Reserved]

2635.807

Teaching, speaking, and writing.

2635.808

Fundraising activities.

2635.809

Just financial obligations.

Subpart I—Related Statutory Authorities

2635.901

General.

2635.902

Related statutes.

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 must 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. When a situation is not covered by the standards set forth in this part, employees must 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.

(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, for example, race, color, religion, sex (including pregnancy, gender identity, and sexual orientation), national origin, age, genetic information, or disability.

(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 of this part, 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 in this section are used throughout this part. Additional definitions appear in the subparts or sections of subparts to which they apply. For purposes of this part:

(a)

Agency

means an executive agency as defined in 5 U.S.C. 105 and the Postal Service and the Postal Regulatory Commission. It does not include the Government Accountability 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 will, when the conduct in issue is that of the head of the agency, be deemed to require that such determination, approval, or action be made or taken by the head of the agency in consultation with the designated agency ethics official.

(c)

Agency ethics official

refers to the designated agency ethics official, the alternate designated agency ethics official, any deputy ethics official, and any additional ethics official who has been delegated authority to assist in carrying out the responsibilities of an agency's ethics program. The responsibilities of agency ethics officials are described in § 2638.104 of this chapter.

(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, recusal, 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 § 2638.104(a) of this chapter.

(g)

Disciplinary action

includes those disciplinary actions referred to in Office of Personnel Management regulations at 5 CFR chapter I 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. It includes employees of a State or local

government or other organization who are serving on detail to an agency, pursuant to 5 U.S.C. 3371,

et seq.

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 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)

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 an official capacity on behalf of that agency or entity.

(k)

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.

(l)

Supplemental agency regulation

means a regulation issued pursuant to § 2635.105.

§ 2635.103

Applicability to enlisted members of the uniformed services.

The provisions of this part are not applicable to enlisted members of the uniformed services. However, each agency with jurisdiction over enlisted members of the uniformed services may issue regulations defining the ethical conduct obligations of enlisted members under its jurisdiction. Such regulations or policies, if issued, should 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.

(a)

Details to other agencies.

Except as provided in paragraph (d) of this section, employees on detail, including uniformed officers on assignment, from their employing agencies to another agency for a period in excess of 30 calendar days will be subject to any supplemental agency regulations of the agency to which they are detailed rather than to any supplemental agency regulations of their employing agencies.

(b)

Details to the legislative or judicial branch.

Employees on detail, including uniformed officers on assignment, from their employing agencies to the legislative or judicial branch for a period in excess of 30 calendar days will be subject to the ethical standards of the branch or entity to which detailed. For the duration of any such detail or assignment, employees will 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 their employing agencies, but will 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 (c), an employee detailed to a non-Federal entity remains subject to this part and to any supplemental agency regulation of their 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 their 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, employees who are subject to an agency statute which restricts their activities or financial holdings specifically because of their status as an employee of that agency will continue to be subject to any provisions in the supplemental agency regulations of the employing agency that implement that statute.

§ 2635.105

Supplemental agency regulations.

In addition to the regulations set forth in this part, employees must comply with any supplemental agency regulations issued by their employing agencies under this section.

(a) An agency that wishes to supplement this part must 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 agency regulations which the agency determines are necessary and appropriate, in view of its programs and operations, to fulfill the purposes of this part must 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 must submit its supplemental agency regulations to the

Federal Register

for publication and codification at the expense of the agency in this title. 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.

(d) Employees of a State or local government or other organization who are serving on detail to an agency, pursuant to 5 U.S.C. 3371,

et seq.,

are subject to any requirements, in addition to those in this part, established by a supplemental agency regulation issued under this section to the extent that such regulation expressly provides.

§ 2635.106

Disciplinary and corrective action.

(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 (including pregnancy, gender identity, and sexual orientation), national origin, age, genetic information, or disability 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 § 2638.104(a) and (d) of this chapter, each agency has a designated agency ethics official and an alternate designated agency ethics official; these are the employees who have the primary responsibility for directing the daily activities of an agency's ethics program. Acting directly or through other officials, the designated agency ethics official is responsible for providing ethics advice and counseling regarding the application of this part.

(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. When 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. Agency ethics officials are required by 28 U.S.C. 535 to report any information they receive relating to a violation of the criminal code, title 18 of the United States Code.

Subpart B—Gifts From Outside Sources

§ 2635.201

Overview and considerations for declining otherwise permissible gifts.

(a)

Overview.

This subpart contains standards that prohibit an employee from soliciting or accepting any gift from a prohibited source or any gift given because of the employee's official position, unless the item is excluded from the definition of a

gift

(see § 2635.203(b)) or falls within one of the exceptions set forth in this subpart.

(b)

Considerations for declining otherwise permissible gifts.

(1) Every employee has a fundamental responsibility to the United States and its citizens to place loyalty to the Constitution, laws, and ethical principles above private gain. An employee's actions should promote the public's trust that this responsibility is being met. For this reason, employees should consider declining otherwise permissible gifts if they believe that a reasonable person with knowledge of the relevant facts would question the employee's integrity or impartiality as a result of accepting the gift.

(2) Employees who are considering whether acceptance of a gift would lead a reasonable person with knowledge of the relevant facts to question their integrity or impartiality may consider, among other relevant factors, whether:

(i) The gift has a high market value;

(ii) The timing of the gift creates the appearance that the donor is seeking to influence an official action;

(iii) The gift was provided by a person who has interests that may be substantially affected by the performance or nonperformance of the employee's official duties; and

(iv) Acceptance of the gift would provide the donor with significantly disproportionate access.

(3) Notwithstanding paragraph (b)(1) of this section, an employee who accepts a gift that qualifies for an exception under § 2635.204 does not violate this subpart or the Principles of Ethical Conduct set forth in § 2635.101(b).

(4) Employees who have questions regarding this subpart, including whether the employee should decline a gift that would otherwise be permitted under an exception found in § 2635.204, should seek advice from an agency ethics official.

Example 1 to paragraph (b):

An employee of the Peace Corps is in charge of making routine purchases of office supplies. After a promotional presentation to highlight several new products, a vendor offers to buy the employee lunch, which costs less than $20. The employee is concerned that a reasonable person may question their impartiality by accepting the free lunch, as the timing of the offer indicates that the donor may be seeking to influence an official action and the company has interests that may be substantially affected by the performance or nonperformance of the employee's duties. The employee concludes that appearance considerations weigh against accepting the gift.

§ 2635.202

General prohibition on solicitation or acceptance of gifts.

(a)

Prohibition on soliciting gifts.

Except as provided in this subpart, an employee may not, directly or indirectly:

(1) Solicit a gift from a prohibited source; or

(2) Solicit a gift to be given because of the employee's official position.

(b)

Prohibition on accepting gifts.

Except as provided in this subpart, an employee may not, directly or indirectly:

(1) Accept a gift from a prohibited source; or

(2) Accept a gift given because of the employee's official position.

(c)

Relationship to illegal gratuities statute.

A gift accepted pursuant to an exception found in this subpart will not constitute an illegal gratuity otherwise prohibited by 18 U.S.C. 201(c)(1)(B), unless it is accepted in return for being influenced in the performance of an official act. As more fully described in § 2635.205(d)(1), an employee may not solicit or accept a gift if to do so would be prohibited by the Federal bribery statute, 18 U.S.C. 201(b).

Example 1 to paragraph (c):

A Government contractor who specializes in information technology software has offered an employee of the Department of Energy's information technology acquisition division a $15 gift card to a local restaurant if the employee will recommend to the agency's contracting officer that the agency select the contractor's products during the next

acquisition. Even though the gift card is less than $20, the employee may not accept the gift under § 2635.204(a) because it is conditional upon official action by the employee. Pursuant to this paragraph (c) and § 2635.205(a), notwithstanding any exception to the rules in this part, an employee may not accept a gift in return for being influenced in the performance of an official act.

§ 2635.203

Definitions.

For purposes of this subpart, the following definitions 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.

(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. The term excludes the following:

(1) Modest items of food and non-alcoholic 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 primarily for presentation;

Example 1 to paragraph (b)(2):

After giving a speech at the facility of a pharmaceutical company, a Government employee is presented with a glass paperweight in the shape of a pill capsule with the name of the company's latest drug and the date of the speech imprinted on the side. The employee may accept the paperweight because it is an item with little intrinsic value which is intended primarily for presentation.

Example 2 to paragraph (b)(2):

After participating in a panel discussion hosted by an international media company, a Government employee is presented with an inexpensive portable music player emblazoned with the media company's logo. The portable music player has a market value of $25. The employee may not accept the portable music player as it has a significant independent use as a music player rather than being intended primarily for presentation.

Example 3 to paragraph (b)(2):

After giving a speech at a conference held by a national association of miners, a Department of Commerce employee is presented with a block of granite that is engraved with the association's logo, a picture of the Appalachian Mountains, the date of the speech, and the employee's name. The employee may accept this item because it is similar to a plaque, is designed primarily for presentation, and has little intrinsic value.

(3) Loans from banks and other financial institutions on terms generally available to the public;

(4) Opportunities and benefits, including favorable rates, commercial discounts, and free attendance or participation 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 the employee's official duties;

Example 1 to paragraph (b)(5):

A Government employee is attending a free trade show on official time. The trade show is held in a public shopping area adjacent to the employee's office building. The employee voluntarily enters a drawing at an individual vendor's booth, which is open to the public, by filling in an entry form on the vendor's display table and dropping it into the contest box. The employee may accept the resulting prize because entry into the contest was not required by or related to their official duties.

Example 2 to paragraph (b)(5):

Attendees at a conference, which is not open to the public, are entered in a drawing for a weekend getaway to Bermuda as a result of being registered for the conference. A Government employee who attends the conference in an official capacity could not accept the prize under paragraph (b)(5) of this section, as the event is not open to the public.

(6) Pension and other benefits resulting from continued participation in an employee welfare and benefits plan maintained by a current or former employer;

(7) Anything which is paid for by the Government or secured by the Government under Government contract;

Example 1 to paragraph (b)(7):

An employee at the Occupational Safety and Health Administration is assigned to travel away from their duty station to conduct an investigation of a collapse at a construction site. The employee's agency is paying for relevant travel expenses, including airfare. The employee may accept and retain travel promotional items, such as frequent flyer miles, received as a result of this official travel, to the extent permitted by 5 U.S.C. 5702 note and 41 CFR part 301-53.

(8) Free attendance to an event provided by the sponsor of the event to:

(i) An employee who is assigned to present information on behalf of the agency at the event on any day when the employee is presenting;

(ii) An employee whose presence on any day of the event is deemed to be essential by the agency to the presenting employee's participation in the event, provided that the employee is accompanying the presenting employee; and

(iii) One guest of the presenting employee on any day when the employee is presenting, provided that others in attendance will generally be accompanied by a guest, the offer of free attendance for the guest is unsolicited, and the agency designee, orally or in writing, has authorized the presenting employee to accept;

Example 1 to paragraph (b)(8):

An employee of the Department of the Treasury who is assigned 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), the employee may accept a token of appreciation that has a market value of $20 or less.

Example 2 to paragraph (b)(8):

An employee of the Securities and Exchange Commission is assigned to present the agency's views at a roundtable discussion of an ongoing working group. The employee may accept free attendance to the meeting under paragraph (b)(8) of this section because the employee has been assigned to present information at the meeting on behalf of the agency. If it is determined by the agency that it is essential that other employees accompany the presenting employee to the roundtable discussion, the accompanying employees may also accept free attendance to the meeting under paragraph (b)(8)(ii) of this section.

Example 3 to paragraph (b)(8):

An employee of the United States Trade and Development Agency is invited to attend a cocktail party hosted by a prohibited source. The employee believes that there will be an opportunity to discuss official matters with other attendees while at the event. Although the employee may voluntarily discuss official matters with other

attendees, the employee has not been assigned to present information on behalf of the agency. The employee may not accept free attendance to the event under paragraph (b)(8) of this section.

(9) 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 the employee's official duties which take place away from the employee's duty station, provided that the agency's acceptance is in accordance with the implementing regulations at 41 CFR chapter 304; and

(ii) Other gifts provided in-kind which have been accepted by an agency under its agency gift acceptance statute; and

(10) Anything for which market value is paid by the employee.

(c)

Market value

means the cost that a member of the general public would reasonably expect to 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 is deemed to be the face value of the ticket.

Example 1 to paragraph (c):

An employee who has been given a watch inscribed with the corporate logo of a prohibited source may determine its market value based on the observation that a comparable watch, not inscribed with a logo, generally sells for about $50.

Example 2 to paragraph (c):

During an official visit to a factory operated by a well-known athletic footwear manufacturer, an employee of the Department of Labor is offered a commemorative pair of athletic shoes manufactured at the factory. Although the cost incurred by the donor to manufacture the shoes was $17, the market value of the shoes would be the $100 that the employee would have to pay for the shoes on the open market.

Example 3 to paragraph (c):

A prohibited source has offered a Government 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.

Example 4 to paragraph (c):

A company offers an employee of the Federal Communication Commission (FCC) free attendance for two to a private skybox at a ballpark to watch a major league baseball game. The skybox is leased annually by the company, which has business pending before the FCC. The skybox tickets provided to the employee do not have a face value. To determine the market value of the tickets, the employee must add the face value of two of the most expensive publicly available tickets to the game and the market value of any food, parking, or other tangible benefits provided in connection with the gift of attendance that are not already included in the cost of the most expensive publicly available tickets.

Example 5 to paragraph (c):

An employee of the Department of Agriculture is invited to a reception held by a prohibited source. There is no entrance fee to the reception event or to the venue. To determine the market value of the gift, the employee must add the market value of any entertainment, food, beverages, or other tangible benefit provided to attendees in connection with the reception, but need not consider the cost incurred by the sponsor to rent or maintain the venue where the event is held. The employee may rely on a per-person cost estimate provided by the sponsor of the event, unless the employee or an agency designee has determined that a reasonable person would find that the estimate is clearly implausible.

(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 the 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

given because of the employee's official position

if the gift is from a person other than an employee and would not have been given had the employee not held the status, authority, or duties associated with the employee's Federal position.

Note 1 to paragraph (e):

Gifts between employees are subject to the limitations set forth in subpart C of this part.

Example 1 to paragraph (e):

When free season tickets are offered by an opera guild to all members of the Cabinet, the gift is offered because of their official positions.

Example 2 to paragraph (e):

Employees at a regional office of the Department of Justice (DOJ) work in Government-leased space at a private office building, along with various private business tenants. A major fire in the building during normal office hours causes a traumatic experience for all occupants of the building in making their escape, and it is the subject of widespread news coverage. A corporate hotel chain, which does not meet the definition of a

prohibited source

for DOJ, seizes the moment and announces that it will give a free night's lodging to all building occupants and their families, as a public goodwill gesture. Employees of DOJ may accept, as this gift is not being given because of their Government positions. The donor's motivation for offering this gift is unrelated to the DOJ employees' status, authority, or duties associated with their Federal positions, but instead is based on their mere presence in the building as occupants at the time of the fire.

(f) A gift which is

solicited or accepted indirectly

includes a gift:

(1) Given with the employee's knowledge and acquiescence to the employee's parent, sibling, spouse, child, dependent relative, or a member of the employee's household 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 the employee has not indirectly solicited or accepted a gift by the raising of funds or other support for a charitable organization if done in accordance with § 2635.808.

Example 1 to paragraph (f)(2):

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)

Free attendance

includes waiver of all or part of the fee for an event or the provision of food, refreshments, entertainment, instruction, or materials furnished to all attendees as an integral part of the event. It does not include travel expenses, lodgings, or entertainment collateral to the event. It does not include meals taken other than in a group setting with all other attendees, unless the employee is a presenter at the event and is invited to a separate meal for participating presenters that is hosted by the sponsor of the event. When the offer of free attendance has been extended to an accompanying guest, the market value of the gift of free attendance includes

the market value of free attendance by both the employee and the guest.

(h)

Legal expense fund

has the meaning set forth in § 2635.1003.

(i)

Pro bono legal services

has the meaning set forth in § 2635.1003.

§ 2635.204

Exceptions to the prohibition for acceptance of certain gifts.

Subject to the limitations in § 2635.205, this section establishes exceptions to the prohibitions set forth in § 2635.202(a) and (b). Even though acceptance of a gift may be permitted by one of the exceptions contained in this section, it is never inappropriate and frequently prudent for an employee to decline a gift if acceptance would cause a reasonable person to question the employee's integrity or impartiality. Section 2635.201(b) identifies considerations for declining otherwise permissible gifts.

(a)

Gifts of $20 or less.

An employee may accept unsolicited gifts having an aggregate market value of $20 or less per source per occasion, provided that the aggregate market value of individual gifts received from any one person under the authority of this paragraph (a) does not exceed $50 in a calendar year. The exception in this paragraph (a) does not apply to gifts of cash or of investment interests such as stock, bonds, or certificates of deposit. When 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. When 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.

Example 1 to paragraph (a):

An employee of the Securities and Exchange Commission and their spouse have been invited by a representative of a regulated entity to a community theater production, 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. The couple may attend the play only if the employee pays the full $60 value of the two tickets.

Example 2 to paragraph (a):

An employee of the National Geospatial-Intelligence Agency has been invited by an association of cartographers to speak about the agency's role in the evolution of missile technology. At the conclusion of the speech, the association presents the employee a framed map with a market value of $18 and a ceramic mug that has a market value of $15. The employee may accept the map or the mug, but not both, because the aggregate value of these two tangible items exceeds $20.

Example 3 to paragraph (a):

On four occasions during the calendar year, an employee of the Defense Logistics Agency (DLA) 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 a cousin, who is employed by the same corporation, if the cousin's birthday present can be accepted under the exception at paragraph (b) of this section for gifts based on a personal relationship.

Example 4 to paragraph (a):

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 (EPA) has accepted an association's gift of travel expenses and conference fees for an employee to attend a conference on the long-term effect of radon exposure. While at the conference, the employee may accept a gift basket of $20 or less from one of the companies underwriting the event even though it was not approved in advance by the EPA. Although 31 U.S.C. 1353 is the authority under which the EPA accepted the gift to the agency of travel expenses and conference fees, the gift basket is a gift to the employee rather than to the EPA.

Example 5 to paragraph (a):

During off-duty time, an employee of the Department of Defense (DoD) attends a trade show involving companies that are DoD contractors. The employee is offered software worth $15 at X Company's booth, a calendar worth $12 at Y Company's booth, and a deli lunch worth $8 from Z Company. The employee may accept all three of these items because they do not exceed $20 per source, even though they total more than $20 at this single occasion.

Example 6 to paragraph (a):

An employee of the Department of Defense (DoD) is being promoted to a higher level position in another DoD office. Six individuals, each employed by a different defense contractor, who have worked with the DoD employee over the years, decide to act in concert to pool their resources to buy the employee a nicer gift than each could buy separately. Each defense contractor employee contributes $20 to buy a desk clock for the DoD employee that has a market value of $120. Although each of the contributions does not exceed the $20 limit, the employee may not accept the $120 gift because it is a single gift that has a market value in excess of $20.

Example 7 to paragraph (a):

During a holiday party, an employee of the Department of State is given a $15 store gift card to a national coffee chain by an agency contractor. The employee may accept the card as the market value is less than $20. The employee could not, however, accept a gift card that is issued by a credit card company or other financial institution, because such a card is equivalent to a gift of cash.

(b)

Gifts based on a personal relationship.

An employee may accept a gift given by an individual 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 and nature of the relationship and whether the family member or friend personally pays for the gift.

Example 1 to paragraph (b):

An employee of the Federal Deposit Insurance Corporation (FDIC) has been dating an accountant employed by a member bank. As part of its “Work-Life Balance” program, the bank has given each employee in the accountant's division two tickets to a professional basketball game 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 the invitation to attend the game. Even though the tickets were initially purchased by the member bank, they were given without reservation to the accountant to use as desired, and the invitation to the employee was motivated by their personal friendship.

Example 2 to paragraph (b):

Three partners in a law firm that handles corporate mergers have invited an employee of the Federal Trade Commission (FTC) 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 the employee has developed an amicable relationship with the three partners 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.

Example 3 to paragraph (b):

A Peace Corps employee enjoys using a social media site on the internet in a personal capacity outside of work. The employee has used the site to keep in touch with friends, neighbors, coworkers, professional contacts, and other individuals they have met over the years through both work and personal activities. One of these individuals works for a contractor that provides language services to the Peace Corps. The employee was acting in an official capacity when they met the individual at a meeting to discuss a matter related to the contract between their respective employers. Thereafter, the two communicated occasionally regarding contract matters, and later also granted one another access to join their social media networks through their respective social media accounts. However, the pair did not communicate further in their personal capacities, carry on extensive personal interactions, or meet socially outside of work. One day, the individual, whose employer continues to serve as a Peace Corps contractor, contacts the employee to offer a pair of concert tickets worth $30 apiece. Although the employee and the individual are connected through social media, the circumstances do not demonstrate that the gift was clearly motivated by a personal relationship, rather than the position of the employee, and therefore the employee may not accept the gift pursuant to paragraph (b) of this section.

(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) A reduction or waiver of the fees for 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, commercial discounts, and free attendance or participation not precluded by paragraph (c)(3) of this section:

(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;

(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; or

(iv) Offered to employees by an established employee organization, such as an association composed of Federal employees or a nonprofit employee welfare organization, because of the employees' Government employment, so long as the employee is part of the class of individuals eligible for assistance from the employee organization as set forth in the organization's governing documents.

Example 1 to paragraph (c)(2):

A computer company offers a discount on the purchase of computer equipment to all public and private sector computer procurement officials who work in organizations with over 300 employees. An employee who works as the computer procurement official for a Government agency could not accept the discount to purchase the personal computer under the exception in paragraph (c)(2)(i) of this section. The employee's membership in the group to which the discount is offered is related to Government employment because membership is based on the employee's status as a procurement official with the Government.

Example 2 to paragraph (c)(2):

An employee of the Consumer Product Safety Commission (CPSC) 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 employee associations and similar organizations to large segments of the public.

Example 3 to paragraph (c)(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 4 to paragraph (c)(2):

A nonprofit military relief society provides access to financial counseling services, loans, and grants to all sailors and Marines. A service member may accept financial benefits from the relief society, including to cover legal expenses, because the benefits are offered by an employee organization that was established before the legal matter arose, and because the benefits are being offered because of the employees' Government employment, as set forth in the relief society's governing documents.

(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, unless authorized by statute or regulation (

e.g.,

5 U.S.C. 5702 note, regarding frequent flyer miles).

Example 1 to paragraph (c)(3):

The administrative officer for a field office of U.S. Immigration and Customs Enforcement (ICE) has signed an 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 ICE funds, the administrative officer cannot keep the briefcase which, if claimed and received, is Government property.

(d)

Awards and honorary degrees

—(1)

Awards.

An employee may accept a bona fide award for meritorious public service or achievement and any item incident to the award, provided that:

(i) The award and any item incident to the award are not from a person who has interests that may be substantially affected by the performance or nonperformance of the employee's official duties, or from an association or other organization if a majority of its members have such interests; and

(ii) If the award or any item incident to the award is in the form of cash or an investment interest, or if the aggregate value of the award and any item incident to the award, other than free attendance to the event provided to the employee and to members of the employee's family by the sponsor of the event, exceeds $200, the agency ethics official has made a written determination that the award is made as part of an established program of recognition.

Example 1 to paragraph (d)(1):

Based on a written determination by an agency ethics official that the prize meets the criteria set forth in paragraph (d)(2) of this section, an employee of the National Institutes of Health (NIH) 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 to paragraph (d)(1):

A defense contractor, ABC Systems, has an annual award program for the outstanding public employee of the year. The award includes a cash payment of $1,000. The award program is wholly funded to ensure its continuation on a regular basis for the next twenty years and selection of award recipients is made pursuant to written standards. An employee of the Department of the Air Force, who has duties that include overseeing contract performance by ABC Systems, is selected to receive the award. The employee may not accept the cash award because ABC Systems has interests that may be substantially affected by the performance or nonperformance of the employee's official duties.

Example 3 to paragraph (d)(1):

An ambassador selected by a nonprofit organization as a recipient of its annual award for distinguished service in the interest of world peace may, together with their spouse and children, attend the awards ceremony dinner and accept a crystal bowl worth $200 presented during the ceremony. However, if the organization has also offered airline tickets for the ambassador and the 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 the ambassador 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.

(2)

Established program of recognition.

An award and an item incident to the award are made pursuant to an established program of recognition if:

(i) Awards have been made on a regular basis or, if the program is new, there is a reasonable basis for concluding that awards will be made on a regular basis based on funding or funding commitments; and

(ii) Selection of award recipients is made pursuant to written standards.

(3)

Honorary degrees.

An employee may accept an honorary degree from an institution of higher education, as defined at 20 U.S.C. 1001, or from a similar foreign institution of higher education, 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.

Note 1 to paragraph (d)(3):

When the honorary degree is offered by a foreign institution of higher education, the agency may need to make a separate determination as to whether the institution of higher education is a foreign government for purposes of the Emoluments Clause of the U.S. Constitution (U.S. Const., art. I, sec. 9, cl. 8), which forbids employees from accepting emoluments, presents, offices, or titles from foreign governments, without the consent of Congress. The Foreign Gifts and Decorations Act, 5 U.S.C. 7342, however, may permit the acceptance of honorary degrees in some circumstances.

Example 1 to paragraph (d)(3):

A well-known university located in the United States 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.

(4)

Presentation events.

An employee who may accept an award or honorary degree pursuant to paragraph (d)(1) or (3) of this section may also accept free attendance to the event provided to the employee and to members of the employee's family by the sponsor of an event. In addition, the employee may also accept unsolicited offers of travel to and from the event provided to the employee and to members of the employee's family by the sponsor of the event. Travel expenses accepted under this paragraph (d)(4) must be added to the value of the award for purposes of determining whether the aggregate value of the award exceeds $200.

(e)

Gifts based on outside business or employment relationships.

An employee may accept meals, lodgings, transportation, and other benefits:

(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 to paragraph (e)(1):

A Department of Agriculture employee whose spouse is a computer programmer employed by a Department of Agriculture 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 need to recuse from performing official duties affecting the spouse's employer.

Example 2 to paragraph (e)(1):

When the spouses of other clerical personnel have not been invited, an employee of the Defense Contract Audit Agency whose spouse 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 the spouse received a special invitation from the company for them to attend as a couple.

(2) Resulting from the employee's outside business or employment activities when it is clear that such benefits are based on the outside business or employment activities and have not been offered or enhanced because of the employee's official status;

Example 1 to paragraph (e)(2):

The members of an Army Corps of Engineers environmental advisory committee that meets six times per year are special Government employees. A member who has a consulting business may accept an invitation to a $50 dinner from a corporate client, an Army construction contractor, unless, for example, the invitation was extended in order to discuss the activities of the advisory 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 recusal requirements of subpart F of this part applicable when seeking employment; or

Example 1 to paragraph (e)(3):

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 the employee has properly recused from further work on the regulations as required by subpart F of this part, the employee may enter into employment discussions with the company and may accept the company's offer to pay for airfare, hotel, and meals in connection with an interview trip.

(4) Provided by a former employer to attend a reception or similar event when other former employees have been invited to attend, the invitation and benefits are based on the former employment relationship, and it is clear that such benefits have not been offered or enhanced because of the employee's official position.

Example 1 to paragraph (e)(4):

An employee of the Department of the Army is invited by a former employer, an Army contractor, to attend its annual holiday dinner party. The former employer traditionally invites both its current and former employees to the holiday dinner regardless of their current employment activities. Under these circumstances, the employee may attend the dinner because the dinner

invitation is a result of the employee's former outside employment activities, other former employees have been asked to attend, and the gift is not offered because of the employee's official position.

(5) For purposes of paragraphs (e)(1) through (4) of this section,

employment

means any form of non-Federal employment or business relationship involving the provision of personal services.

(f)

Gifts in connection with political activities permitted by the Hatch Act Reform Amendments.

An employee who, in accordance with the Hatch Act Reform Amendments of 1993, at 5 U.S.C. 7323, may take an active part in political management or in political campaigns, may accept meals, lodgings, transportation, and other benefits, including free attendance at events, for the employee and an accompanying guest, when provided, in connection with such active participation, by a political organization described in 26 U.S.C. 527(e). Any other employees, such as a security officers, whose official duties require them to accompany an employee to a political event, may accept meals, free attendance, and entertainment provided at the event by such an organization.

Example 1 to paragraph (f):

The Secretary of the Department of Health and Human Services 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)

Gifts of free attendance at widely attended gatherings

—(1)

Authorization.

When authorized in writing by the agency designee pursuant to paragraph (g)(3) of this section, an employee may accept an unsolicited gift of free attendance at all or appropriate parts of a widely attended gathering. For an employee who is subject to a leave system, attendance at the event will 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.

(2)

Widely attended gatherings.

A gathering is widely attended if it is expected that:

(i) A large number of persons will attend;

(ii) Persons with a diversity of views or interests will be present, for example, if it is open to members from throughout the interested industry or profession or if those in attendance represent a range of persons interested in a given matter; and

(iii) There will be an opportunity to exchange ideas and views among invited persons.

(3)

Written authorization by the agency designee.

The agency designee may authorize an employee or employees to accept a gift of free attendance at all or appropriate parts of a widely attended gathering only if the agency designee issues a written determination after finding that:

(i) The event is a widely attended gathering, as set forth in paragraph (g)(2) of this section;

(ii) The employee's attendance at the event is in the agency's interest because it will further agency programs or operations;

(iii) The agency's interest in the employee's attendance outweighs the concern that the employee may be, or may appear to be, improperly influenced in the performance of official duties; and

(iv) If a person other than the sponsor of the event invites or designates the employee as the recipient of the gift of free attendance and bears the cost of that gift, the event is expected to be attended by more than 100 persons, and the value of the gift of free attendance does not exceed $480.

(4)

Determination of agency interest.

In determining whether the agency's interest in the employee's attendance outweighs the concern that the employee may be, or may appear to be, improperly influenced in the performance of official duties, the agency designee may consider relevant factors including:

(i) The importance of the event to the agency;

(ii) The nature and sensitivity of any pending matter affecting the interests of the person who extended the invitation and the significance of the employee's role in any such matter;

(iii) The purpose of the event;

(iv) The identity of other expected participants;

(v) Whether acceptance would reasonably create the appearance that the donor is receiving preferential treatment;

(vi) Whether the Government is also providing persons with views or interests that differ from those of the donor with access to the Government; and

(vii) The market value of the gift of free attendance.

(5)

Cost provided by person other than the sponsor of the event.

The cost of the employee's attendance will be considered to be provided by a person other than the sponsor of the event when such person designates the employee to be invited and bears the cost of the employee's attendance through a contribution or other payment intended to facilitate the 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 guest.

When others in attendance will generally be accompanied by a guest of their choice, and when the invitation is from the same person who has invited the employee, the agency designee may authorize an employee to accept an unsolicited invitation of free attendance to one accompanying guest to participate in all or a portion of the event at which the employee's free attendance is permitted under paragraph (g)(1) of this section. The authorization required by this paragraph (g)(6) must be provided in writing.

Example 1 to paragraph (g):

An aerospace industry association that is a prohibited source sponsors an industry-wide, two-day seminar for which it charges a fee of $800 and anticipates attendance of approximately 400. An Air Force contractor pays $4,000 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 of free attendance because the contractor, rather than the association, provided the cost of their attendance; the contractor designated the specific employees to receive the gift of free attendance; and the value of the gift exceeds $480 per employee.

Example 2 to paragraph (g):

An aerospace industry association that is a prohibited source sponsors an industry-wide, two-day seminar for which it charges a fee of $25 and anticipates attendance of approximately 50. An Air Force contractor pays $125 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 of free attendance because the contractor, rather than the association, provided the cost of their attendance; the contractor designated the specific employees to receive the gift of free attendance; and the event was not expected to be attended by more than 100 persons.

Example 3 to paragraph (g):

Force official to whom the sponsoring association, rather than the contractor, extended one of the five invitations could attend if the employee's participation were determined to be in the interest of the agency and the employee received a written authorization.

Example 4 to paragraph (g):

An employee of the Department of Transportation is invited by a news organization to an annual press dinner sponsored by an association of press organizations. Tickets for the event cost $480 per person and attendance is limited to 400 representatives of press organizations and their guests. If the employee's attendance is determined to be in the interest of the agency and the agency designee provides a written authorization, the employee may accept the invitation from the news organization because more than 100 persons will attend and the cost of the ticket does not exceed $480. However, if the invitation were extended to the employee and an accompanying guest, the employee's guest could not be authorized to attend for free because the market value of the gift of free attendance would exceed $480.

Example 5 to paragraph (g):

An employee of the Department of Energy (DOE) and their spouse have been invited by a major utility executive to a small dinner party. A few other officials of the utility and their spouses or other guests are also invited, as is a representative of a consumer group concerned with utility rates and their spouse. The DOE official believes the dinner party will provide an opportunity to socialize with and get to know those in attendance. The employee may not accept the free invitation under this exception, even if attendance could be determined to be in the interest of the agency. The small dinner party is not a widely attended gathering. Nor could the employee be authorized to accept even if the event were instead a corporate banquet to which forty company officials and their spouses or other guests were invited. In this second case, notwithstanding the larger number of persons expected (as opposed to the small dinner party just noted) and despite the presence of the consumer group representative and spouse who are not officials of the utility, those in attendance would still not represent a diversity of views or interests. Thus, the company banquet would not qualify as a widely attended gathering under those circumstances either.

Example 6 to paragraph (g):

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 gift exception at paragraph (a) of this section.

Example 7 to paragraph (g):

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 under § 2635.203(b)(8). If the conference is widely attended, the employee may be authorized to accept the sponsor's offer to waive the attendance fee for the remainder of the conference if the agency designee has made a written determination that attendance is in the agency's interest.

Example 8 to paragraph (g):

A military officer has been approved to attend a widely attended gathering, pursuant to paragraph (g) of this section, that will be held in the same city as the officer's duty station. The defense contractor sponsoring the event has offered to transport the officer in a limousine to the event. The officer may not accept the offer of transportation because the definition of

free attendance

set forth in § 2635.203(g) excludes travel, and the market value of the transportation would exceed $20.

(h)

Social invitations.

An employee may accept food, refreshments, and entertainment, not including travel or lodgings, for the employee and an accompanying guest, at a social event attended by several persons if:

(1) The invitation is unsolicited and is from a person who is not a prohibited source;

(2) No fee is charged to any person in attendance; and

(3) If either the sponsor of the event or the person extending the invitation to the employee is not an individual, the agency designee has made a written determination after finding that the employee's attendance would not cause a reasonable person with knowledge of the relevant facts to question the employee's integrity or impartiality, consistent with § 2635.201(b).

Example 1 to paragraph (h):

An employee of the White House Press Office has been invited to a social dinner for current and former White House Press Officers at the home of an individual who is not a prohibited source. The employee may attend even if the invitation is because of the employee's 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 300-3.1 may accept unsolicited 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 Rates of Per Diem Allowances for Travel in Foreign Areas, Per Diem Supplement, section 925 to the Standardized Regulations (GC-FA), available at

www.state.gov;

(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 to paragraph (i):

A number of local business owners in a developing country are eager for a U.S. company to locate a manufacturing facility in their province. An official of the U.S. International Development Finance Corporation may accompany the visiting vice president of the U.S. company to a dinner meeting hosted by the business owners at a province restaurant when 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 their own behalf or on behalf of any family member, provided that such acceptance does not violate § 2635.205(a) or (b), 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 when acceptance of the gift is specifically authorized by a supplemental agency regulation issued with the concurrence of the Office of

Government Ethics, pursuant to § 2635.105.

(l)

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 which a statute specifically authorizes an employee to accept. Gifts which may be accepted 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. The employee's acceptance must be approved by the agency in accordance with part 410 of this title; or

(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.

(m)

Gifts of informational materials.

(1) An employee may accept unsolicited gifts of informational materials, provided that:

(i) The aggregate market value of all informational materials received from any one person does not exceed $100 in a calendar year; or

(ii) If the aggregate market value of all informational materials from the same person exceeds $100 in a calendar year, an agency designee has made a written determination after finding that acceptance by the employee would not be inconsistent with the standard set forth in § 2635.201(b).

(2)

Informational materials

are writings, recordings, documents, records, or other items that:

(i) Are educational or instructive in nature;

(ii) Are not primarily created for entertainment, display, or decoration; and

(iii) Contain information that relates in whole or in part to the following categories:

(A) The employee's official duties or position, profession, or field of study;

(B) A general subject matter area, industry, or economic sector affected by or involved in the programs or operations of the agency; or

Example 1 to paragraph (m):

An analyst at the Agricultural Research Service receives an edition of an agricultural research journal in the mail from a consortium of private farming operations concerned with soil toxicity. The journal edition has a market value of $75. The analyst may accept the gift.

Example 2 to paragraph (m):

An inspector at the Mine Safety and Health Administration receives a popular novel with a market value of $25 from a mine operator. Because the novel is primarily for entertainment purposes, the inspector may not accept the gift.

Example 3 to paragraph (m):

An employee at the Department of the Army is offered an encyclopedia on cyberwarfare from a prohibited source. The cost of the encyclopedia is far in excess of $100. The agency designee determines that acceptance of the gift would be inconsistent with the standard set out in § 2635.201(b). The employee may not accept the gift under paragraph (m) of this section.

(n)

Legal expense funds and pro bono legal services.

An employee who seeks legal representation for a matter arising in connection with the employee's past or current official position, the employee's prior position on a campaign of a candidate for President or Vice President, or the employee's prior position on a Presidential Transition Team may accept:

(1) Payments for legal expenses paid out of a legal expense fund that is established and operated in accordance with subpart J of this part; and

(2)

Pro bono

legal services provided in accordance with subpart J of this part.

§ 2635.205

Limitations on use of exceptions.

Notwithstanding any exception provided in this subpart, other than § 2635.204(j), an employee may not:

(a) Accept a gift in return for being influenced in the performance of an official act;

(b) Use, or permit the use of, the employee's Government position, or any authority associated with public office, to solicit or coerce the offering of a gift;

(c) 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 the employee's public office for private gain;

Example 1 to paragraph (c):

A purchasing agent for a Department of Veterans Affairs medical center routinely deals with representatives of pharmaceutical manufacturers who provide information about new company products. Because of a crowded calendar, the purchasing agent has offered to meet with manufacturer representatives during 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 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 gifts of $20 or less, the practice of accepting even these modest gifts on a recurring basis is improper.

(d) Accept a gift in violation of any statute; relevant statutes applicable to all employees include, but are not limited to:

(1) 18 U.S.C. 201(b), which prohibits public officials from, directly or indirectly, corruptly demanding, seeking, receiving, accepting, or agreeing to receive or accept anything of value personally or for any other person or entity in return for being influenced in the performance of an official act; being influenced to commit or aid in committing, or to collude in, or allow, any fraud, or make opportunity for the commission of any fraud, on the United States; or for being induced to do or omit to do any action in violation of their official duties. 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; and

(2) 18 U.S.C. 209, which prohibits employees, other than special Government employees, 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;

(e) Accept a gift in violation of any Executive order; or

(f) Accept any gift when acceptance of the gift is specifically prohibited by a supplemental agency regulation issued with the concurrence of the Office of Government Ethics, pursuant to § 2635.105.

§ 2635.206

Proper disposition of prohibited gifts.

(a) Unless a gift is accepted by an agency acting under specific statutory authority, an employee who has received a gift that cannot be accepted under this subpart must dispose of the gift in accordance with the procedures set forth in this section. The employee must promptly complete the authorized disposition of the gift. The obligation to dispose of a gift that cannot be accepted under this subpart is independent of an

agency's decision regarding corrective or disciplinary action under § 2635.106.

(1)

Gifts of tangible items.

The employee must promptly return any tangible item to the donor or pay the donor its market value; or, in the case of a tangible item with a market value of $100 or less, the employee may destroy the item. 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.

Example 1 to paragraph (a)(1):

A Department of Commerce employee received a $25 T-shirt from a prohibited source after providing training at a conference. Because the gift would not be permissible under an exception to this subpart, the employee must either return or destroy the T-shirt or promptly reimburse the donor $25. Destruction may be carried out by physical destruction or by permanently discarding the T-shirt by placing it in the trash.

Example 2 to paragraph (a)(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 a speech on Federal lands policy. To comply with this section, the employee must either promptly return the barometer or pay the donor the market value of the gift. Alternatively, the National Park Service may choose to accept the gift if permitted under specific statutory gift acceptance authority. The employee may not destroy this gift, as the market value is in excess of $100.

(2)

Gifts of perishable items.

When it is not practical to return a tangible item in accordance with paragraph (a)(1) of this section because the item is perishable, the employee may, at the discretion of the employee's supervisor or the agency designee, give the item to an appropriate charity, share the item within the recipient's office, or destroy the item.

Example 1 to paragraph (a)(2):

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)

Gifts of intangibles.

The employee must promptly reimburse the donor the market value for any entertainment, favor, service, benefit, or other intangible. Subsequent reciprocation by the employee does not constitute reimbursement.

Example 1 to paragraph (a)(3):

A Department of Defense employee wishes to attend a charitable event for which they were offered a $300 ticket by a prohibited source. Although attendance is not in the interest of the agency under § 2635.204(g), the employee may attend if they reimburse the donor the $300 face value of the ticket.

(4)

Gifts from foreign governments or international organizations.

The employee must dispose of gifts from foreign governments or international organizations in accordance with 41 CFR part 102-42.

(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) Employees who, on their own initiative, promptly comply with the requirements of this section will not be deemed to have improperly accepted an unsolicited gift. Employees who promptly consult their agency ethics official to determine whether acceptance of an unsolicited gift is proper and who, upon the advice of the ethics official, return the gift or otherwise dispose of the gift in accordance with this section, will be considered to have complied with the requirements of this section on the employee's own initiative.

(d) Employees are encouraged to record any actions they have taken to properly dispose of gifts that cannot be accepted under this subpart, such as by sending an electronic mail message to the appropriate agency ethics official or the employee's supervisor.

Subpart C—Gifts Between Employees

§ 2635.301

Overview.

This subpart contains standards that prohibit an employee from giving or contributing to a gift to an official superior, and official superiors are prohibited from knowingly accepting such a gift. Employees also are prohibited from soliciting a contribution from another employee for a gift to an official superior. In addition, employees are prohibited from accepting a gift from an employee who receives less pay. The prohibitions in this subpart apply unless the item is excluded from the definition of a

gift

(see § 2635.303(a)) or falls within one of the exceptions set forth in this subpart. Gifts from outside sources are subject to the limitations set forth in subpart B of this part.

§ 2635.302

General standards.

(a)

Gifts to superiors.

Except as provided in this subpart, employees may not:

(1) Directly or indirectly, give a gift to or make a contribution toward a gift for an official superior, and an official superior may not knowingly accept such a gift; or

(2) Solicit a contribution from another employee for a gift to either their own or the other employee's official superior.

(b)

Gifts from employees receiving less pay.

Except as provided in this subpart, employees may not, directly or indirectly, accept a gift from an employee who receives less pay unless:

(1) There is a personal relationship between the two employees that would justify the gift and the employee receiving the gift is not the official superior of the employee giving the gift; or

(2) The employee giving the gift is the official superior of the employee receiving the gift.

Example 1 to paragraph (b):

A GS-13 Department of Homeland Security (DHS) employee has been close personal friends with a neighbor, a GS-15 employee in another government agency, for many years. During their friendship, the GS-13 employee has often allowed the neighbor's family to use their vacation house rent-free. The GS-15 employee recently accepted a position at DHS, and in the new position will be the direct supervisor of the GS-13 employee. Although the personal relationship between the two employees justified the gift of rent-free use of the vacation home before they were both employed at DHS, for the duration of their supervisor-subordinate relationship the GS-13 employee may not allow the GS-15 neighbor to use the vacation house rent-free or give other gifts, except as permitted by the exceptions contained in this subpar

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