# 88 FR 10774: Modernization Updates to Standards of Ethical Conduct for Employees of the Executive Branch

> Federal · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/FR_PRORULE_2023-02440

## Section

- **Citation:** 88 FR 10774
- **Heading:** Modernization Updates to Standards of Ethical Conduct for Employees of the Executive Branch
- **Jurisdiction:** Federal
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Federal Register / Vol. 88 / 88 FR 10774

## Text

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:
Proposed rule.

SUMMARY:
The U.S. Office of Government Ethics (OGE) requests comments on proposed changes to the Standards of Ethical Conduct for Employees of the Executive Branch (Standards). The proposed amendments seek to update the Standards based on OGE's experience gained from application of the regulation since its inception. The proposed amendments also would incorporate past interpretive guidance, add and update regulatory examples, improve clarity, update citations, and make technical corrections.

DATES:
Written comments are invited and must be received on or before April 24, 2023.

ADDRESSES:
You may submit comments in writing to OGE on this proposed rule, identified by RIN 3209-AA43, by any of the following methods:
Email: 2635modernization@oge.gov. Include the reference “Proposed Amendments to Standards of Conduct” in the subject line of the message.
Mail: Office of Government Ethics, Suite 500, 1201 New York Avenue NW, Washington, DC 20005-3917, Attention: “Proposed Amendments to Standards of Conduct.”
Instructions: All submissions must include OGE's agency name and the Regulation Identifier Number (RIN), 3209-AA43, for this proposed rulemaking. All comments, including attachments and other supporting materials, will become part of the public record and subject to public disclosure. Comments may be posted on OGE's website, www.oge.gov. Sensitive personal information, such as account numbers or Social Security numbers, should not be included. Comments generally will not be edited to remove any identifying or contact information.
FOR FURTHER INFORMATION CONTACT:
Kimberly L. Sikora Panza, Associate Counsel, or Christie Chung, Assistant Counsel, U.S
ject to public disclosure. Comments may be posted on OGE's website, www.oge.gov. Sensitive personal information, such as account numbers or Social Security numbers, should not be included. Comments generally will not be edited to remove any identifying or contact information.
FOR FURTHER INFORMATION CONTACT:
Kimberly L. Sikora Panza, Associate Counsel, or Christie Chung, Assistant Counsel, U.S. Office of Government Ethics, 1201 New York Avenue NW, Suite 500, Washington, DC 20005-3917; Telephone: 202-482-9300; TTY: 800-877-8339; Fax: 202-482-9237.

SUPPLEMENTARY INFORMATION:

I. Rulemaking History
On August 7, 1992, the U.S. Office of Government Ethics (OGE) published the Standards of Ethical Conduct for Employees of the Executive Branch (Standards), which are codified at 5 CFR part 2635. See 57 FR 35006 (Aug. 7, 1992), as amended. The Standards 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).
Pursuant to a provision of the Ethics in Government Act of 1978, 5 U.S.C. 13122, the Director of OGE is responsible for periodically reviewing, evaluating, and updating the rules and regulations that pertain to ethics in the executive branch. Most recently, in 2016, OGE issued updated regulations in subpart B and subpart F of part 2635 relating to gifts from outside sources and seeking employment. See 81 FR 48687 (July 26, 2016); see also 81 FR 81641 (Nov. 18, 2016). In accordance with 5 U.S.C. 13122, OGE has reviewed the regulations found in subparts A, C, D, E, G, H, and I of part 2635, and is proposing changes to these provisions in light of OGE's experience gained from application of the Standards since they became effective in February 1993
from outside sources and seeking employment. See 81 FR 48687 (July 26, 2016); see also 81 FR 81641 (Nov. 18, 2016). In accordance with 5 U.S.C. 13122, OGE has reviewed the regulations found in subparts A, C, D, E, G, H, and I of part 2635, and is proposing changes to these provisions in light of OGE's experience gained from application of the Standards since they became effective in February 1993.
In formulating this proposed rule, OGE has 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 has solicited and considered the views of executive branch agency ethics officials.
II. Analysis of Proposed Amendments
In addition to the specific changes discussed below, OGE is proposing a number of global technical changes to all subparts of the Standards. Among other things, OGE proposes to add appropriate punctuation and modernize language by using consistent capitalization of “Government,” removing gendered language and language that unnecessarily focuses on marital status, and updating the words “shall” and “where.” OGE also is replacing the terms “disqualification” and “disqualify” with “recusal” and “recuse” to modernize language throughout all subparts of the Standards, consistent with language OGE modernized in subpart F in 2016. As highlighted in further detail below, OGE also proposes to update citations and change agency names throughout this part as appropriate.
A
ting the words “shall” and “where.” OGE also is replacing the terms “disqualification” and “disqualify” with “recusal” and “recuse” to modernize language throughout all subparts of the Standards, consistent with language OGE modernized in subpart F in 2016. As highlighted in further detail below, OGE also proposes to update citations and change agency names throughout this part as appropriate.
A. General Provisions (Subpart A)
In § 2635.101(b)(13), OGE proposes to clarify that the enumerated list of equal opportunity laws and regulations is not exhaustive, and also proposes to add the words “(including pregnancy, gender identity, and sexual orientation)” after “sex,” to change “handicap” to “disability,” and to add “genetic information,” to incorporate more contemporary terminology and reflect categories covered by the Equal Employment Opportunity Commission. OGE also proposes to incorporate this more contemporary terminology in § 2635.106.
In § 2635.102(a), OGE proposes to replace the words “Postal Rate Commission” with the words “Postal Regulatory Commission,” and the words “General Accounting Office” with the words “Government Accountability Office” to reflect the change in the names of these agencies. OGE also proposes to update paragraph § 2635.102(b) to use language more consistent with the defined term “head of an agency” in paragraph (i); a similar language change is made in § 2635.503(c). Former § 2635.102(j) has been removed because OGE modified the language of each subpart to make the regulation gender neutral. As a result, subsequent paragraphs in § 2635.102 have been relabeled.
OGE proposes to revise the title of § 2635.103 to more accurately reflect the contents of the provision by adding “enlisted” before “members of the uniformed services.” Section 2635.103 states that the provisions of this part are not applicable to enlisted members of the uniformed services, and OGE proposes to make only minor technical edits to the language of this section for clarity
relabeled.
OGE proposes to revise the title of § 2635.103 to more accurately reflect the contents of the provision by adding “enlisted” before “members of the uniformed services.” Section 2635.103 states that the provisions of this part are not applicable to enlisted members of the uniformed services, and OGE proposes to make only minor technical edits to the language of this section for clarity.
In § 2635.105(c)(3), OGE proposes to delete the reference to supplemental regulations issued prior to the Standards and Executive Order 11222 (May 8, 1965), which was revoked by Executive Order 12674 (April 12, 1989).
Finally, OGE proposes to update § 2635.102(c) and (f), as well as § 2635.107 to reference updated citations and language of part 2638 of this chapter, which was most recently revised in 2016.
B. Gifts From Outside Sources (Subpart B)
In subpart B, OGE proposes a minor revision to Example 1 following § 2635.201(b) to better illustrate the operation of the paragraph. Similarly, OGE also proposes to make minor changes to Example 4 following § 2635.204(a) to clarify the interplay
For the remainder of the subpart, OGE proposes to make only global technical changes that are suggested throughout the Standards. Specifically, OGE proposes to modernize the regulatory text by adding appropriate punctuation and capitalization, updating changed agency names, removing gendered language and language that unnecessarily focuses on marital status, and updating the words “where” and “disqualification/disqualify.”
C. Gifts Between Employees (Subpart C)
Throughout subpart C, OGE proposes to replace the terms “donating” and “donation” with “contributing” and “contribution” respectively to modernize language and ensure consistency in language in this section. No substantive change is intended.
Proposed § 2635.301—Overview
In § 2635.301, OGE proposes to update the overview in recognition of the updates being made to the regulatory restrictions on gifts to superiors, as discussed below
place the terms “donating” and “donation” with “contributing” and “contribution” respectively to modernize language and ensure consistency in language in this section. No substantive change is intended.
Proposed § 2635.301—Overview
In § 2635.301, OGE proposes to update the overview in recognition of the updates being made to the regulatory restrictions on gifts to superiors, as discussed below. OGE also proposes to add language clarifying that subpart B is the appropriate subpart for analyzing gifts from outside sources. In subpart B, there is a similar reminder pointing to subpart C in the note that follows § 2635.203(e). OGE believes that a parallel note in subpart C would be a helpful clarification, and the proposed language is phrased in a way that tracks the reminder in subpart B.
Proposed § 2635.302—General Standards
In this section, OGE proposes tailored revisions aimed at making the restriction and exceptions regarding gifts to superiors and gifts from employees receiving less pay more logical. OGE believes that the proposed changes are consistent with the underlying statute restricting certain gifts between employees, 5 U.S.C. 7351, as well as OGE's authority in that law to issue regulations that exempt voluntary gifts in appropriate circumstances.
First, OGE has received input over the years that the restriction on gifts to superiors is incongruous with other restrictions on employees accepting gifts because it does not restrict an official superior from accepting a gift from a subordinate, and instead is framed in terms of what a subordinate employee may not do with respect to giving gifts to a superior. The current language is based on the statutory text of 5 U.S.C. 7351, which also articulates the restriction in terms of what a subordinate employee may not do, as opposed to what an official superior may not do
restrict an official superior from accepting a gift from a subordinate, and instead is framed in terms of what a subordinate employee may not do with respect to giving gifts to a superior. The current language is based on the statutory text of 5 U.S.C. 7351, which also articulates the restriction in terms of what a subordinate employee may not do, as opposed to what an official superior may not do. OGE believes that the regulation should emphasize a superior's responsibility to not accept improper gifts from a subordinate, consistent with how the Standards otherwise focus on an employee's responsibility to not accept other improper gifts. See, e.g., subpart B (restricting employees' ability to accept certain gifts from outside sources); § 2635.302(b) (restricting employees' ability to accept certain gifts from individuals receiving less pay). Therefore, OGE proposes to update the language in § 2635.302(a)(1) to clarify that not only may an employee not directly or indirectly give a gift to an official superior, but also that “an official superior may not knowingly accept such a gift.”
OGE also seeks to resolve a peculiarity in the current regulatory language in § 2635.302(b)(1) relating to the circumstances in which an employee may accept a gift from another employee “receiving less pay.” The current regulatory text permits an employee to accept a gift from another employee who receives less pay if there is a personal relationship to justify the gift and the two employees are not in a “subordinate-official superior relationship.” The quoted language refers expansively to any subordinate-official superior relationship, regardless of whether the intended recipient of the gift is the subordinate or the official superior. OGE believes that the current language is worded more broadly than necessary to address the key concern with gift giving between employees at different pay levels—gift giving from a subordinate to a superior
The quoted language refers expansively to any subordinate-official superior relationship, regardless of whether the intended recipient of the gift is the subordinate or the official superior. OGE believes that the current language is worded more broadly than necessary to address the key concern with gift giving between employees at different pay levels—gift giving from a subordinate to a superior. Accordingly, OGE proposes to replace the requirement in the exception that the employees not be in a subordinate-official superior relationship with a more precise requirement that the employee receiving the gift not be the official superior of the employee giving the gift (proposed § 2635.302(b)(1)). This addition does not modify the existing condition in the exception that there be a personal relationship between the employees that would justify the gift.
Finally, OGE seeks to modernize the exception in § 2635.302(b) in response to changes in the Federal pay system since the rule was first promulgated in 1992. Although at one time it may have been the case that superiors categorically received more pay than their subordinates, under current Federal pay systems, there are situations in which a subordinate may earn more than their official superior. 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. OGE believes that the purpose of 5 U.S.C. 7351, notably titled “Gifts to Superiors,” was to prevent an official superior from accepting a gift from a subordinate, not to prevent a gift flowing the other way. OGE therefore proposes to categorically exclude from the restriction in § 2635.302(b) gift-giving situations where the lower-paid employee giving the gift is the official superior of the employee receiving the gift (proposed § 2635.302(b)(2))
tably titled “Gifts to Superiors,” was to prevent an official superior from accepting a gift from a subordinate, not to prevent a gift flowing the other way. OGE therefore proposes to categorically exclude from the restriction in § 2635.302(b) gift-giving situations where the lower-paid employee giving the gift is the official superior of the employee receiving the gift (proposed § 2635.302(b)(2)). The proposed language categorically excludes such gifts from the prohibition without the additional “personal relationship” requirement contained in § 2635.302(b)(1).
In addition to those changes, OGE also recommends a new example to § 2635.302 to clarify that even if individuals had a gift-giving relationship prior to being in a subordinate-superior relationship, while there is a subordinate-supervisor relationship, their gift giving must be restricted. The proposed example seeks to highlight that a change in circumstances does not obviate the subpart C restrictions, and that even gift giving between employees with a preexisting relationship still must fit within the exceptions of this subpart.
Proposed § 2635.303—Definitions
OGE proposes to modernize Example 1 after § 2635.303(f) by removing unnecessarily specific geographical language. No substantive change is intended.
Proposed § 2635.304—Exceptions
In paragraph (a), OGE proposes to change “other” to “an” in the first sentence; the current phrasing in § 2635.304(a) presupposes that a subordinate always receives less pay than an official superior, which is not always the case, as discussed above. The word replacement proposed by OGE removes this assumption. OGE also proposes to make a slight modification to the phrasing of the exception in § 2635.304(a)(5), by making the final phrase the beginning phrase of the exception. No substantive change is intended; OGE simply wishes to clarify that this gift exception can be used unless the transferred leave was obtained in violation of 5 CFR 630.912
e word replacement proposed by OGE removes this assumption. OGE also proposes to make a slight modification to the phrasing of the exception in § 2635.304(a)(5), by making the final phrase the beginning phrase of the exception. No substantive change is intended; OGE simply wishes to clarify that this gift exception can be used unless the transferred leave was obtained in violation of 5 CFR 630.912. In addition, OGE proposes to update the language of Example 4 to paragraph (a)
OGE proposes to revise paragraph (b)(1) to add “bereavement” to the non-exhaustive list of special, infrequent occasions covered by this exception. As highlighted by several agencies, questions as to whether such instances constitute a special, infrequent occasion arise at a difficult time when employees are grieving. OGE views such occasions as being appropriately covered by this exception, and explicit reference to them will provide clarity and eliminate uncertainty. In addition, OGE proposes to add Example 4 to paragraph (b) to illustrate that a milestone birthday, such as a 50th birthday, is not an “infrequently occurring occasion of personal significance.” The new example would respond to recurring questions regarding whether birthdays ending in zero are an “infrequently occurring occasion of personal significance” under § 2635.304(b), and would reflect OGE's consistent advice that they are not.
OGE also proposes to fix the issue of having an undesignated paragraph in § 2635.304(c) by reorganizing this section and designating the undesignated paragraph. No substantive change is intended.
Finally, OGE proposes to make various ministerial changes to this section. Among other changes, OGE proposes to replace the word “secretary” with the word “assistant” in Example 4 following paragraph (a) and Example 5 to paragraph (c) to modernize these examples
paragraph in § 2635.304(c) by reorganizing this section and designating the undesignated paragraph. No substantive change is intended.
Finally, OGE proposes to make various ministerial changes to this section. Among other changes, OGE proposes to replace the word “secretary” with the word “assistant” in Example 4 following paragraph (a) and Example 5 to paragraph (c) to modernize these examples. OGE also proposes to replace the word “fee” in Example 1 to paragraph (c) with the words “suggested voluntary contribution,” in order to more accurately reflect that the collection for a gift is a voluntary contribution and not a fee. In addition, OGE proposes to replace “The General Counsel” with “An employee” in Example 2 to paragraph (c) to improve the application of the example. Finally, OGE proposes to replace “$3” in Example 3 to paragraph (c) with “a nominal amount,” to prevent $3 from being interpreted as a universal definition of “nominal amount” as used in paragraph (c) and to make the example more consistent with Example 1. These modifications are not intended to make any substantive changes.
D. Conflicting Financial Interests (Subpart D)
In this subpart and subpart E, OGE has added the modifier “particular” before “matter” when the change would provide further clarity regarding the type of matter being discussed. Although in context the word “particular” had previously been implied, OGE made these adjustments to achieve more precise language.
Proposed § 2635.401—Overview
OGE proposes a minor change to the phrasing of § 2635.401 to clarify the relationship of subpart D and 5 CFR part 2640. Part 2640 interprets and is the implementing regulation for 18 U.S.C. 208, and with this change, OGE seeks to guide ethics officials to part 2640 for complete guidance on that law.
Proposed § 2635.402—Disqualifying Financial Interests
In this section, OGE proposes to revise various examples
minor change to the phrasing of § 2635.401 to clarify the relationship of subpart D and 5 CFR part 2640. Part 2640 interprets and is the implementing regulation for 18 U.S.C. 208, and with this change, OGE seeks to guide ethics officials to part 2640 for complete guidance on that law.
Proposed § 2635.402—Disqualifying Financial Interests
In this section, OGE proposes to revise various examples. In Example 2 following paragraph (b)(2), OGE proposes to streamline the characterization of the spouse's interest in their employing company by simply stating that the spouse has no stock or other direct or indirect ownership interest in the company. OGE also proposes to modify the language at the conclusion of the example to reference “covered relationship” and otherwise align the text with § 2635.502. No substantive change is intended with this adjustment, which is made to improve the clarity and readability of this example. Finally, in Example 2 following paragraph (b)(3), OGE proposes to replace the words “Interstate Commerce Commission” with the words “Surface Transportation Board” to reflect the change in the name of this agency.
In addition, OGE proposes to update the notification and recusal language in § 2635.402(c)(1) and (2) to align with updated phrasing in subpart F, and also reflect that written notification and recusal statements are required for certain employees under the Representative Louise McIntosh Slaughter Stop Trading on Congressional Knowledge Act (STOCK Act). Finally, OGE proposes to delete the final phrase from § 2635.402(d)(1), which discusses 18 U.S.C. 208(b)(2) regulatory exemptions, and notes that the regulations in subpart B of part 2640 “supersede any preexisting agency regulatory exemptions”; this language may have been relevant when the Standards were first promulgated, but it is superfluous today
ng on Congressional Knowledge Act (STOCK Act). Finally, OGE proposes to delete the final phrase from § 2635.402(d)(1), which discusses 18 U.S.C. 208(b)(2) regulatory exemptions, and notes that the regulations in subpart B of part 2640 “supersede any preexisting agency regulatory exemptions”; this language may have been relevant when the Standards were first promulgated, but it is superfluous today.
Proposed § 2635.403—Prohibited Financial Interests
OGE proposes to delete “issued after February 3, 1993,” which currently modifies “agency supplemental regulations” in § 2635.403(a). This language was relevant when the rule was first drafted because there were some pre-existing agency ethics rules, but at this time, there are no agency supplemental regulations that were issued before February 1993.
In Example 1 following paragraph (b)(2), OGE proposes to add a dollar figure to the amount of stock owned, to make clear that the de minimis regulatory exemption in 5 CFR 2640.202 does not apply in this scenario. OGE also proposes to correct the language in paragraph (c)(1), which appears to incorrectly refer to the employee's “dependent child,” not “minor child,” which is the relevant term for purposes of the restrictions of 18 U.S.C. 208.
E. Impartiality in Performing Official Duties (Subpart E)
Proposed § 2635.501—Overview
OGE proposes to restructure § 2635.501 to organize the current text and the text of the current Note into new paragraphs. New paragraph (a) explains more fully the scope of subpart E and the distinction between relationships that implicate 18 U.S.C. 208 and those that implicate this subpart. New paragraph (b) explains more fully the distinction between waivers under 18 U.S.C. 208 and authorizations and waivers under subpart E. No substantive change is intended
ext and the text of the current Note into new paragraphs. New paragraph (a) explains more fully the scope of subpart E and the distinction between relationships that implicate 18 U.S.C. 208 and those that implicate this subpart. New paragraph (b) explains more fully the distinction between waivers under 18 U.S.C. 208 and authorizations and waivers under subpart E. No substantive change is intended.
OGE also proposes to add a new note following § 2635.501 to remind employees and ethics officials that even though a particular situation may not raise concerns under subpart E, a supervisor or person responsible for assigning work may decide not to assign certain work to an employee for other reasons. The note is not itself a source of authority to either issue or withhold assignments; it merely highlights that agencies have various options relating to work assignments irrespective of subpart E. OGE intends that this note, read together with the other provisions of subpart E, will identify options available to an agency relating to potential concerns regarding impartiality, appearances, and employee work assignments.
Proposed § 2635.502—Personal and Business Relationships
OGE proposes to reorganize § 2635.502(a) by redesignating the two substantive provisions currently found in the main body of paragraph (a) and the substantive provision currently found in paragraph (a)(2) as paragraphs (a)(1), (2), and (3), respectively
potential concerns regarding impartiality, appearances, and employee work assignments.
Proposed § 2635.502—Personal and Business Relationships
OGE proposes to reorganize § 2635.502(a) by redesignating the two substantive provisions currently found in the main body of paragraph (a) and the substantive provision currently found in paragraph (a)(2) as paragraphs (a)(1), (2), and (3), respectively. In these redesignations, current paragraph (a)(1), which encourages employees to seek assistance from relevant officials when considering whether a reasonable person would question their
In § 2635.502(b), the current regulation provides that an employee has a covered relationship with “[a] person for whom the employee's spouse, parent or dependent child is, to the employee's knowledge, serving or seeking to serve as an officer, director, trustee, general partner, agent, attorney, consultant, contractor or employee.” OGE proposes to remove the qualifier “dependent” before “child” in this paragraph, which will mean that an employee will have a covered relationship with a person for whom any child is, to the employee's knowledge, serving or seeking to serve as an officer, director, trustee, general partner, agent, attorney, consultant, contractor, or employee. Removing the “dependent” qualifier acknowledges that there may be impartiality concerns relating to certain business relations of an employee's child regardless of whether that child is a dependent, just as the subpart presently acknowledges that there could be impartiality concerns relating to certain business relations of an employee's parent, without any dependency predicate.
OGE proposes to update the definition of “particular matter involving specific parties” found at § 2635.502(b)(3) to cross-reference the definition at 5 CFR 2640.102( l ); the current cross-reference is obsolete, as it refers to part 2637, which is no longer in effect
could be impartiality concerns relating to certain business relations of an employee's parent, without any dependency predicate.
OGE proposes to update the definition of “particular matter involving specific parties” found at § 2635.502(b)(3) to cross-reference the definition at 5 CFR 2640.102( l ); the current cross-reference is obsolete, as it refers to part 2637, which is no longer in effect. Like part 2635, the part 2640 regulation applies to current employees; it simply was not in effect at the time the Standards were first published and thus could not serve as the relevant cross-reference.
In addition, OGE proposes to replace current Example 3 following paragraph (b)(3) with a new example. The purpose of changing the example is to illustrate the covered relationship described in paragraph (b)(1)(iii), and to describe a situation in which an employee could justifiably conclude that a reasonable person would be likely to question their impartiality. OGE also proposes to add two new examples following paragraph (b)(3), Examples 6 and 7. The purpose of Example 6 is to illustrate a situation where a covered relationship described in (b)(1)(iii) exists, but the employee could justifiably conclude that a reasonable person would not be likely to question their impartiality. The purpose of Example 7 is to illustrate a situation in which there is no covered relationship under § 2635.502(b)(1), but the employee applies the catch-all provision of proposed § 2635.502(a)(3) because the employee is concerned about appearances, and could justifiably conclude that a reasonable person would be likely to question their impartiality.
In § 2635.502(c), OGE proposes to more clearly state an agency designee's determination authority
in which there is no covered relationship under § 2635.502(b)(1), but the employee applies the catch-all provision of proposed § 2635.502(a)(3) because the employee is concerned about appearances, and could justifiably conclude that a reasonable person would be likely to question their impartiality.
In § 2635.502(c), OGE proposes to more clearly state an agency designee's determination authority. To more clearly highlight the situations in which an agency designee may make an independent determination regarding a potential appearance problem, OGE has reorganized the text currently at § 2635.502(c) into new § 2635.502(c)(1), and separated the different potential determination scenarios into new § 2635.502(c)(1)(i) and (ii). As a result of this reorganization, current § 2635.502(c)(1) and (2) have been renumbered as § 2635.502(c)(2) and (3). This reorganization does not substantively change the two situations set forth in the regulation in which an agency designee may make an independent determination as to whether a reasonable person would question an employee's impartiality—appearance problems arising from the financial interests of a member of the employee's household in a particular matter involving specific parties, or from a particular matter involving specific parties in which a person with whom the employee has a covered relationship is or represents a party.
Finally, OGE proposes minor changes to § 2635.502(d), (e), and (f). In Example 2 to § 2635.502(d), OGE proposes to make a minor revision to resolve potential ambiguity in the final sentence of the example. No substantive change is intended. In § 2635.502(e), OGE proposes to add a sentence explicitly stating that when the covered relationship is with a former employer, the relevant recusal period is for one year after the date of the employee's resignation from the position with the former employer
proposes to make a minor revision to resolve potential ambiguity in the final sentence of the example. No substantive change is intended. In § 2635.502(e), OGE proposes to add a sentence explicitly stating that when the covered relationship is with a former employer, the relevant recusal period is for one year after the date of the employee's resignation from the position with the former employer. Currently, the length of the cooling-off period with respect to former employers is embedded in the definition of “covered relationship”; this sentence does not make any substantive change, but is designed to provide greater clarity for employees. Additionally, in § 2635.502(e)(1) and (e)(2), OGE proposes to update the language regarding notification and documentation procedures to align with updated phrasing in § 2635.402(c)(2) and subpart F. Finally, OGE proposes to make the title of § 2635.502(f) more accurate and read “ Irrelevant considerations” instead of “ Relevant considerations,” because that paragraph describes what considerations are not relevant for purposes of determinations under § 2635.502. The actual language of § 2635.502(f) remains unchanged.
Proposed § 2635.503—Covered Payments From Former Employers
OGE proposes various updates to § 2635.503. First, OGE proposes to replace the defined term of “extraordinary payment” in § 2635.503(b)(1) (and throughout the regulation) with the term “covered payment.” This adjustment brings the terminology in this section in line with the terminology used elsewhere in this subpart, namely the term “covered relationship” in § 2635.502
nts From Former Employers
OGE proposes various updates to § 2635.503. First, OGE proposes to replace the defined term of “extraordinary payment” in § 2635.503(b)(1) (and throughout the regulation) with the term “covered payment.” This adjustment brings the terminology in this section in line with the terminology used elsewhere in this subpart, namely the term “covered relationship” in § 2635.502. OGE does not intend any substantive change in replacing the word “extraordinary” with “covered.”
OGE also proposes to update § 2635.503(a) to remove the limitation in the current regulation that a relevant payment under this section must be received “prior to entering Government service.” In OGE's experience, the potential ethics concerns and issues relating to covered payments from former employers can arise regardless of whether a payment is received before or after an individual begins Government service. A payment received the day after an employee assumes the duties of a Government position is not different See 56 FR 33778, 33786 (July 23, 1991). A recusal requirement equally applicable to both scenarios addresses such appearance issues. Of course, any payment received by a current Government employee could raise potential supplementation of salary concerns. Therefore, the new example that OGE proposes to add to § 2635.503(a) to illustrate a covered payment received during Government service makes clear that ethics officials are also required to analyze the payment to determine whether it constituted a supplementation of salary under 18 U.S.C. 209.
To help make the “covered payment” definition easier to understand, OGE also proposes to move the concept of a “qualifying program,” which is currently embedded in § 2635.503(b)(1), into a standalone definition
d during Government service makes clear that ethics officials are also required to analyze the payment to determine whether it constituted a supplementation of salary under 18 U.S.C. 209.
To help make the “covered payment” definition easier to understand, OGE also proposes to move the concept of a “qualifying program,” which is currently embedded in § 2635.503(b)(1), into a standalone definition. The “qualifying program” definition proposed at § 2635.503(b)(2) retains salient concepts from the current regulatory language—which contemplates that such a program could be contained in written form, or demonstrated by a history of similar payments to others not entering Government service—and also includes two new clarifications regarding what OGE considers to be such a program. First, to be a qualifying written program, the program cannot treat individuals departing for Government service more favorably than other individuals. When OGE first promulgated § 2635.503, OGE thought it was unlikely that employers would offer employment plans or contracts that provided for targeted payments for employees who later serve in Government positions. See 57 FR 35006, 35028. However, since 1992, OGE has seen numerous benefit plans where employers have written plans or programs that treat individuals departing for Government service more favorably than other individuals. Because such plans raise the same potential concerns regarding an employee's impartiality to the payor, OGE has determined that it is appropriate to clarify that a written program will not be considered to be a “qualifying program” if individuals entering Government service are treated more favorably than other former employees. This change also brings OGE's treatment of written and non-written plans into alignment
raise the same potential concerns regarding an employee's impartiality to the payor, OGE has determined that it is appropriate to clarify that a written program will not be considered to be a “qualifying program” if individuals entering Government service are treated more favorably than other former employees. This change also brings OGE's treatment of written and non-written plans into alignment. In the current definition, a qualifying program based on actual practice has to be shown by a history of similar payments made to persons not entering Government service, which underscores the importance of the payor not treating employees entering Government more favorably.
Second, OGE proposes to clarify when it is appropriate to consider a history of similar payments made to others not entering Government service. Specifically, OGE proposes to update paragraph (b) to enumerate OGE's longstanding view that when there is a written plan, historical payments contrary to a provision of such a plan should not be considered in determining whether there is a “qualifying program.”
Finally, OGE proposes to update the “former employer” definition to make explicit certain details that are implicit in the current definition. First, consistent with the definition of “person” in § 2635.102, OGE proposes to explicitly state that payments from an officer, employee, or agent of a former employer will be considered payments from the former employer. Second, to explicitly indicate that clients are encompassed by the “former employer” definition— e.g., as persons for whom an employee may have served as an agent, attorney, consultant, or contractor—OGE proposes to add a note following § 2635.503(b)(3) to highlight that this defined term encompasses former clients.
F. Seeking Other Employment (Subpart F)
In subpart F, OGE proposes to make only global technical changes that are suggested throughout the Standards
rmer employer” definition— e.g., as persons for whom an employee may have served as an agent, attorney, consultant, or contractor—OGE proposes to add a note following § 2635.503(b)(3) to highlight that this defined term encompasses former clients.
F. Seeking Other Employment (Subpart F)
In subpart F, OGE proposes to make only global technical changes that are suggested throughout the Standards. Among other things, OGE proposes to modernize the regulatory text by removing gendered language and replacing the word “where” with the word “when.”
G. Misuse of Position (Subpart G)
Proposed § 2635.702—Use of Public Office for Private Gain
OGE proposes to add a parenthetical to § 2635.702 to clarify the scope of this section and to indicate that some endorsement may be permitted by this subpart or other applicable laws or regulations. Endorsement may be permitted in certain circumstances, and OGE has received questions indicating that there may be confusion about the current phrasing. No substantive change is intended by this addition.
OGE proposes to amend paragraph (b) of § 2635.702 to clarify the limited circumstances in which an employee may use their official title when making a recommendation. In the current regulation, an employee “may sign a letter of recommendation using [their] official title only in response to a request for an employment recommendation or character reference based upon personal knowledge of the ability or character of an individual with whom [the employee] has dealt in the course of Federal employment or whom [the employee] is recommending for Federal employment.” OGE proposes to update § 2635.702(b) to recognize that an official letter is not the only medium through which recommendations are made. The updated language will provide that an employee may use their official title when making a verbal or written recommendation described in that paragraph
as dealt in the course of Federal employment or whom [the employee] is recommending for Federal employment.” OGE proposes to update § 2635.702(b) to recognize that an official letter is not the only medium through which recommendations are made. The updated language will provide that an employee may use their official title when making a verbal or written recommendation described in that paragraph. In addition, OGE proposes to amend this paragraph to clarify that recommendations permitted under § 2635.702(b) are not limited to employment recommendations. Over the years, questions have arisen as to the permissibility of an employee using their title when signing other types of recommendations, such as character references to accompany graduate school applications. Removing the word “employment” from this phrase will make clear that an employee may use their official title when they have been asked to provide other types of recommendations. These proposed changes would not ease the other constraints on an employee using their title when providing a requested recommendation for an individual: that the employee has “personal knowledge of the ability or character of [the] individual,” and the individual must be someone “with whom the employee has dealt in the course of Federal employment or whom the employee is recommending for Federal employment.” The proposed changes also would not expand an employee's ability to endorse a business or other kind of entity.
In addition, to provide greater clarity regarding the phrase “with whom [the employee] has dealt in the course of Federal employment,” OGE proposes to update Example 1 following § 2635.702(b) to add language indicating that an employee who is asked to provide a letter of recommendation for an individual who worked with the employee under a Government contract may provide the recommendation using official stationery and may sign the letter using their official title
om [the employee] has dealt in the course of Federal employment,” OGE proposes to update Example 1 following § 2635.702(b) to add language indicating that an employee who is asked to provide a letter of recommendation for an individual who worked with the employee under a Government contract may provide the recommendation using official stationery and may sign the letter using their official title. Such a relationship falls within the scope of the phrase “with whom the employee has dealt in the course of Federal employment.” The proposed change
OGE also proposes to add a new example of appearance of governmental sanction that involves the use of social media. The new example is consistent with OGE's Legal Advisory on social media. See OGE Legal Advisory LA-15-03 (Apr. 9, 2015).
Finally, although it is non-exhaustive as currently written, OGE proposes to add “Judge” to the list of terms of address and ranks highlighted in paragraph (e) in order to provide additional clarity regarding the use of certain terms of address.
Proposed § 2635.703—Use of Nonpublic Information
In Examples 2 and 3 following § 2635.703(b), OGE proposes to change “41 U.S.C. 423” to “41 U.S.C. 2102” to reflect the change to the citation to this statute.
Proposed § 2635.704—Use of Government Property
OGE proposes to amend § 2635.704(b)(1) by replacing the term “automated data processing capabilities” with the term “computers and other electronic devices” and by adding the words “Government email and social media accounts” to the list of items included in the term “Government property.” In updating the list of “Government property” to include more modern types of Government property, OGE does not intend to suggest that older forms of technology and equipment are not also Government property; to avoid such misapprehension, new language has been added to clarify that the term “Government property” is not limited to only those items enumerated in paragraph (b)(1)
vernment property.” In updating the list of “Government property” to include more modern types of Government property, OGE does not intend to suggest that older forms of technology and equipment are not also Government property; to avoid such misapprehension, new language has been added to clarify that the term “Government property” is not limited to only those items enumerated in paragraph (b)(1).
OGE proposes to update § 2635.704(b)(2) to clarify that use of Government property in accordance with an agency's limited de minimis personal use policy is an “authorized purpose” for which Government property may be used.
Finally, OGE also proposes to make certain changes to some of the examples in § 2635.704. OGE proposes to rewrite Example 1 following § 2635.704(b) because the General Services Administration regulation to which the example refers, 41 CFR 101-35.201, no longer exists and has not been superseded by a different Governmentwide regulation. OGE proposes substituting an example that references an agency's de minimis policy relating to the personal use of a Government email account. Additionally, OGE proposes to amend Example 3 following § 2635.704(b)(2) by replacing the term “word processor” with the word “computer.” The reason for the change is to modernize the example; no substantive change is intended.
Proposed § 2635.705—Use of Official Time
OGE proposes to amend Example 1 following § 2635.705(a) by replacing “employee” with “disability claims examiner” in order to make the example clearer. OGE also proposes to revise Example 2 following § 2635.705(a) to remove the reference to the Federal Personnel Manual, which has been abolished, and update the example to more generally refer to such Governmentwide personnel guidance as may be applicable.
OGE proposes to update Example 1 following § 2635.705(b) to remove outdated language referring to the subordinate as a secretary, and also modernize the description of the activities involved. No substantive change is intended.
H
the Federal Personnel Manual, which has been abolished, and update the example to more generally refer to such Governmentwide personnel guidance as may be applicable.
OGE proposes to update Example 1 following § 2635.705(b) to remove outdated language referring to the subordinate as a secretary, and also modernize the description of the activities involved. No substantive change is intended.
H. Outside Activities (Subpart H)
Proposed § 2635.801—Overview
OGE proposes to delete reference to “the limitations on participation in professional organizations” as one of the provisions of this subpart with which the employee must comply. This language refers to the current title of reserved § 2635.806, which OGE proposes to delete (with § 2635.806 remaining reserved), as discussed below.
OGE also proposes to move Example 2 that is currently found in § 2635.802 to § 2635.801(c), because that example is more appropriate as an illustration of the concept that an employee should avoid creating an appearance of violating ethical standards or using their official position for private gain. No changes were made to the existing example other than relocating it to this paragraph.
Finally, OGE proposes to make more precise the description of certain “other laws” that may apply to employee outside activities, as set forth in § 2635.801(d). Specifically, OGE proposes to explicitly note the application and timing of 18 U.S.C. 203 in § 2635.801(d)(3), and to reference the 15% outside earned income limitation when discussing limitations on outside employment in the Ethics in Government Act in § 2635.801(d)(8).
Proposed § 2635.802—Conflicting Outside Employment and Activities
OGE also proposes a new Example 1 to more accurately reflect a situation where an employee's outside activities would conflict with the employee's job duties, as well as to substitute a new Example 2 in § 2635.802 because current Example 2 has been relocated to § 2635.801(c), as discussed above
overnment Act in § 2635.801(d)(8).
Proposed § 2635.802—Conflicting Outside Employment and Activities
OGE also proposes a new Example 1 to more accurately reflect a situation where an employee's outside activities would conflict with the employee's job duties, as well as to substitute a new Example 2 in § 2635.802 because current Example 2 has been relocated to § 2635.801(c), as discussed above. The purpose of the substitution is to provide a more appropriate example of when a recusal obligation exists under subpart E, but there is no issue under § 2635.802. OGE proposes no other substantive changes to these examples.
Proposed § 2635.803—Prior Approval for Outside Employment and Activities
In the first paragraph of this section, OGE proposes to add language reminding employees of their responsibility to ensure that outside activities do not conflict with their official duties, regardless of the existence of any agency supplemental regulations regarding prior approval.
Consistent with the goal of removing obsolete references, OGE also proposes to delete the words “issued after February 3, 1993” modifying “agency supplemental regulation” in the current phrasing of this provision. This language was relevant when the rule was first drafted because there were some pre-existing agency rules, but at this time there are no agency supplemental regulations that were issued before February 1993.
Proposed § 2635.804—Outside Earned Income Limitations Applicable to Certain Presidential Appointees
For the reasons explained below, OGE proposes to rename this section by removing the reference to “other noncareer employees” from the title; to add an introductory paragraph explaining that this paragraph implements outside earned income limitations applicable to certain Presidential appointees and that the outside earned income limitation applicable to covered noncareer employees remains at 5 CFR 2636.304; and to remove the discussion of covered noncareer employees at § 2635.804(b) and renumber the remaining paragraphs
rom the title; to add an introductory paragraph explaining that this paragraph implements outside earned income limitations applicable to certain Presidential appointees and that the outside earned income limitation applicable to covered noncareer employees remains at 5 CFR 2636.304; and to remove the discussion of covered noncareer employees at § 2635.804(b) and renumber the remaining paragraphs accordingly.
Currently, the 15% outside earned income limitation for covered noncareer employees is stated in both § 2635.804(b) and 5 CFR 2636.304, and the limitation for Presidential appointees is stated only in § 2635.804(a). To eliminate redundancy and allow each section to focus on a specific category of employees, OGE
As a ministerial matter, OGE also proposes to revise § 2635.804(a) to remove the reference to outside activities “carried out in satisfaction of the employee's obligation under a contract entered into prior to April 12, 1989” as any contracts before that date, more than 30 years ago, are very unlikely to still be in effect.
Proposed § 2635.806—[Reserved]
OGE proposes to delete the title of reserved § 2635.806, “Participation in professional associations.” OGE does not plan to promulgate a Governmentwide rule on participation in professional associations at this time. Accordingly, § 2635.806 will continue to be “Reserved,” but its current title would be deleted.
Proposed § 2635.807—Teaching, Speaking, and Writing
OGE is aware that § 2635.807 is one of the most complicated provisions in the Standards. In the course of reviewing potential changes to the Standards, therefore, OGE considered various potential changes, including restructuring § 2635.807 or moving it into § 2635.802; ultimately, however, OGE decided to leave the existing structure of this paragraph. Agencies can obtain additional guidance on rules relating to teaching, speaking, and writing on OGE's website
visions in the Standards. In the course of reviewing potential changes to the Standards, therefore, OGE considered various potential changes, including restructuring § 2635.807 or moving it into § 2635.802; ultimately, however, OGE decided to leave the existing structure of this paragraph. Agencies can obtain additional guidance on rules relating to teaching, speaking, and writing on OGE's website.
Although OGE decided against a comprehensive revision of § 2635.807 at this time, it proposes some minor amendments to this section. First, OGE proposes to amend § 2635.807(a) to: (1) clearly state what activity is permitted under paragraph (a)(3); and (2) emphasize that the prohibition on receiving compensation for teaching, speaking, or writing that relates to the employee's official duties applies only to teaching, speaking, or writing that occurs while the person is a Government employee. Regarding the first change, OGE proposes to explicitly note that paragraph (a)(3) is an exception for teaching certain courses. Regarding the second change, proposed § 2635.807(a) specifies that compensation is restricted only for teaching, speaking, or writing “that occurs while the person is a Government employee and that relates to the employee's official duties”; this language emphasizes that the prohibition does not apply to teaching, speaking, or writing done either before or after Government service.
Second, OGE proposes to amend the definition of the term “compensation” at § 2635.807(a)(2)(iii) to streamline the definition and clarify that “compensation” includes travel expenses only with respect to a very small group of employees—covered noncareer employees as defined in 5 CFR 2636.303(a). The new structure of this section defines “compensation” in paragraph (A), identifies the applicable exclusions from the definition of “compensation” in a new designated paragraph (B), and in a new designated paragraph (C) describes whether travel expenses are considered “compensation” for different categories of employees
p of employees—covered noncareer employees as defined in 5 CFR 2636.303(a). The new structure of this section defines “compensation” in paragraph (A), identifies the applicable exclusions from the definition of “compensation” in a new designated paragraph (B), and in a new designated paragraph (C) describes whether travel expenses are considered “compensation” for different categories of employees. This restructuring is intended to make the compensation definition more logically organized, and makes no substantive changes. Finally, in the existing Note following this discussion, OGE proposes to delete the reference to 18 U.S.C. 209 in the reminder that other authorities in some circumstances may limit or preclude an employee's acceptance of travel expenses; the purpose of this deletion is to avoid unnecessary focus on a single statute to the potential exclusion of other applicable authorities. No substantive change is intended.
Third, OGE proposes to make a slight modification to Example 2 to paragraph (a)(2)(iii) to clarify that the official attended the meeting described in the example in their personal capacity. This modification is meant to make explicit information that OGE believes was implicit in the example as originally written.
Fourth, OGE proposes to amend the definition of the term “receive” at § 2635.807(a)(2)(iv) to clarify that receipt of compensation is attributable to the time that the teaching, speaking, or writing occurs, and to clarify how OGE views the timing of receipt when there is an enforceable agreement to receive compensation for writing. The current definition of “receive” does not directly address the timing of the compensation. The revised language addresses timing and is consistent with OGE's guidance discussing teaching, speaking, and writing as an outside activity
eaching, speaking, or writing occurs, and to clarify how OGE views the timing of receipt when there is an enforceable agreement to receive compensation for writing. The current definition of “receive” does not directly address the timing of the compensation. The revised language addresses timing and is consistent with OGE's guidance discussing teaching, speaking, and writing as an outside activity.
Fifth, OGE proposes to update the definition of “particular matter involving specific parties” found at § 2635.807(a)(2)(v) to cross-reference the definition at 5 CFR 2640.102( l ); the current cross-reference is obsolete, as it refers to part 2637, which is no longer in effect. Like part 2635, the part 2640 regulation applies to current employees; it simply was not in effect at the time the Standards were first published and thus could not serve as the relevant cross-reference.
Sixth, OGE's revisions to subpart B of the Standards, which were finalized in 2016, expanded the term “institution of higher education” to include “similar foreign institutions of higher education.” 80 FR 74004, 74007 (Nov. 27, 2015). OGE proposes a parallel change to § 2635.807(a)(3)(i)(A), along with a corresponding note following § 2635.807(a) reminding agency ethics officials to consider the potential applicability of the Emoluments Clause of the U.S. Constitution when an employee teaches a course for compensation at a foreign institution of higher education. OGE also proposes to update the relevant citations found at § 2635.807(a)(3)(i)(B) and (C).
Seventh, OGE proposes to make a slight modification to Example 2 to paragraph (a)(3) in order to make clear that the content being taught at the state college and the continuing education program is the same. No substantive change is intended
for compensation at a foreign institution of higher education. OGE also proposes to update the relevant citations found at § 2635.807(a)(3)(i)(B) and (C).
Seventh, OGE proposes to make a slight modification to Example 2 to paragraph (a)(3) in order to make clear that the content being taught at the state college and the continuing education program is the same. No substantive change is intended.
Eighth, although it is non-exhaustive as currently written, OGE proposes to add “Judge” to the list of terms of address and ranks highlighted in paragraph (b)(3) in order to provide additional clarity regarding the use of certain terms of address in connection with teaching, speaking, or writing.
Finally, OGE proposes to update the note to § 2635.807(b) to cross-reference subpart G to provide a reminder that reference to official title and position other than in a teaching, speaking, or writing capacity can be made only as permitted by § 2635.702(b). This note is parallel to and consistent with the language in § 2635.702 reminding employees that reference to official title and position in connection with teaching, speaking, or writing covered by § 2635.807 must be done consistent with the requirements of § 2635.807.
Proposed § 2635.808—Fundraising Activities
OGE proposes to add language at the beginning of this section designed to resolve continuing confusion about what type of “fundraising” is covered by § 2635.808. OGE frequently receives questions that confuse the restrictions on gifts between employees with the fundraising restrictions. This new language seeks to clarify that § 2635.808
OGE proposes to update Example 2 to § 2635.808(a)(3) to update certain citations and make certain ministerial adjustments. No substantive change is intended.
OGE also proposes to amend § 2635.808(c)(1)(i) and (ii) and the restriction imposed on employees fundraising in their personal capacities
ween employees with the fundraising restrictions. This new language seeks to clarify that § 2635.808
OGE proposes to update Example 2 to § 2635.808(a)(3) to update certain citations and make certain ministerial adjustments. No substantive change is intended.
OGE also proposes to amend § 2635.808(c)(1)(i) and (ii) and the restriction imposed on employees fundraising in their personal capacities. Specifically, OGE proposes to add a “personal relationship” exception to the restriction that is similar to the exception for accepting gifts under subparts B and C. Section 2635.808(c) presently prohibits an employee from personally soliciting contributions from anyone the employee knows to be a “prohibited source.” For regular Government employees, this encompasses any employee of a company regulated by or who seeks to do business with the employee's agency as defined at § 2635.203(d). For special Government employees, this only covers specific types of prohibited sources, those that would be substantially affected by the performance or nonperformance of the employee's duties, as defined at § 2635.203(d)(4). Because of the definition of “person” in § 2635.102, the result is that an employee can technically run afoul of § 2635.808(c) if the employee asks a relative, neighbor, or someone else with whom they have a personal relationship to make a donation and the employee knows that the person happens to work for a prohibited source. OGE believes that such a result extends beyond the fundamental purpose of this restriction, and therefore proposes to add a personal relationship exception to avoid situations like those described above, and to bring the fundraising rules more in line with other provisions in the Standards. The proposed text tracks other language in the Standards regarding personal relationships, and requires that the circumstances make clear that the solicitation is motivated by a family relationship or personal relationship that would justify the solicitation
ption to avoid situations like those described above, and to bring the fundraising rules more in line with other provisions in the Standards. The proposed text tracks other language in the Standards regarding personal relationships, and requires that the circumstances make clear that the solicitation is motivated by a family relationship or personal relationship that would justify the solicitation. A new Example 4 has been added to illustrate this exception.
OGE also proposes to add new Examples 5 and 6, to illustrate fundraising that involves the use of social media; these examples are consistent with OGE's Legal Advisory on social media. See OGE Legal Advisory LA-15-03 (Apr. 9, 2015).
I. Subpart I—Related Statutory Authorities
Proposed § 2635.902—Related Statutes
OGE proposes several technical amendments to § 2635.902 by updating citations and streamlining language.
III. Matters of Regulatory Procedure
Regulatory Flexibility Act
As Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this proposed 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 5, subchapter II), this proposed 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
funded Mandates Reform Act
For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 5, subchapter II), this proposed 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 Order 13563 and Executive Order 12866
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 proposed changes to the regulation is not extensive, the benefits of implementing these changes are significant. The existing regulations are not insufficient, but they have not been significantly updated since their issuance in 1992. OGE's proposed 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
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 regulations 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 proposed rule has been designated as a “significant regulatory action” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, this rule has been reviewed by the Office of Management and Budget.
Executive Order 12988
As Director of the Office of Government Ethics, I have reviewed this proposed 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 13715
The Office of Government Ethics has evaluated this proposed rule under the criteria set forth in Executive Order 13175 and determined that tribal consultation is not required as this proposed 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: February 1, 2023. Emory Rounds, Director, U.S. Office of Government Ethics.
For the reasons set forth in the preamble, the U.S
ent 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: February 1, 2023. Emory Rounds, Director, U.S. Office of Government Ethics.
For the reasons set forth in the preamble, the U.S. Office of Government Ethics proposes to revise 5 CFR part 2635 to read as follows:
PART 2635—STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE EXECUTIVE BRANCH
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. 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
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. 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.
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
2674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306.
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.
is 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.
enetic 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

§ 2635.102 Definitions. The definitions listed below are used throughout this part. Additional definitions appear in the subparts or sections of subparts to which they apply. For purposes of this part:
(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.
itions listed below are used throughout this part. Additional definitions appear in the subparts or sections of subparts to which they apply. For purposes of this part:
(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.
dditional 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 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.
ment 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.
f 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.
ther 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, 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
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
(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 title 5 of the Code of Federal Regulations. Supplemental agency regulations issued under this section are effective only after concurrence and co-signature by the Office of Government Ethics and publication in the Federal Register .
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 title 5 of the Code of Federal Regulations. Supplemental agency regulations issued under this section are effective only after concurrence and co-signature by the Office of Government Ethics and publication in the Federal Register .
(c) This section applies to any supplemental agency regulations or amendments thereof issued under this part. It does not apply to:
(1) A handbook or other issuance intended merely as an explanation of the standards contained in this part or in supplemental agency regulations;
(2) An instruction or other issuance the purpose of which is to:
(i) Delegate to an agency designee authority to make any determination, give any approval or take any other action required or permitted by this part or by supplemental agency regulations; or
(ii) Establish internal agency procedures for documenting or processing any determination, approval or other action required or permitted by this part or by supplemental agency regulations, or for retaining any such documentation; or
(3) Regulations or instructions that an agency has authority, independent of this part, to issue, such as regulations implementing an agency's gift acceptance statute, protecting categories of nonpublic information, or establishing standards for use of Government vehicles.
ction 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
r 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 2638.104(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
t 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 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
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
(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
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
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 §§ 2635.202(c) and 2635.205(a), notwithstanding any exception to the rule, 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;
. 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;
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 and commercial discounts, available to the public or to a class consisting of all Government employees or all uniformed military personnel, whether or not restricted on the basis of geographic considerations;
(5) Rewards and prizes given to competitors in contests or events, including random drawings, open to the public unless the employee's entry into the contest or event is required as part of 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
(6) Pension and other benefits resulting from continued participation in an employee welfare and benefits plan maintained by a current or former employer;
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
(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
ed 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 another employee accompany the presenting employee to the roundtable discussion, the accompanying employee 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
accompanying employee 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
ber 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
ue 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.
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) Indirectly solicited or accepted. 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
aterials 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.

§ 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. This exception 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
) does not exceed $50 in a calendar year. This exception does not apply to gifts of cash or of investment interests such as stock, bonds, or certificates of deposit. 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
e 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 th

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/FR_PRORULE_2023-02440. Check the current official text before relying on it. Not legal advice.