Standards of 
 

Ethical Conduct
 

for Employees
 

of the 
 

Executive Branch
 

October 2002
 
STANDARDS OF 
 

ETHICAL CONDUCT 
 

FOR EMPLOYEES 
 

OF THE 
 

EXECUTIVE BRANCH
 

Final Regulation Issued by
 

the U.S. Office of Government Ethics
 

Codified in 5 C.F.R. Part 2635 (1/1/02 Edition), 

as amended at 67 FR 61761-61762 (Oct. 2, 2002) 

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TABLE OF CONTENTS 

SUBPART A - GENERAL PROVISIONS ........................................1 
 

§ 2635.101 Basic obligation of public service. .................................1 
 

§ 2635.102 Definitions. ...................................................2 
 

§ 2635.103 Applicability to members of the uniformed services. ...................4 
 

§ 2635.104 Applicability to employees on detail. ...............................4 
 

§ 2635.105 Supplemental agency regulations. .................................5 
 

§ 2635.106 Disciplinary and corrective action. .................................6 
 

§ 2635.107 Ethics advice. .................................................7 
 

SUBPART B - GIFTS FROM OUTSIDE SOURCES ...............................8 
 

§ 2635.201 Overview. ....................................................8 
 

§ 2635.202 General standards. ..............................................8 
 

§ 2635.203 Definitions. ...................................................9 
 

§ 2635.204 Exceptions. .................................................. 12
 

§ 2635.205 Proper disposition of prohibited gifts. ............................. 23
 

SUBPART C - GIFTS BETWEEN EMPLOYEES ................................ 24
 

§ 2635.301 Overview. ................................................... 24
 

§ 2635.302 General standards. ............................................. 24
 

§ 2635.303 Definitions. .................................................. 24
 

§ 2635.304 Exceptions. .................................................. 25
 

SUBPART D - CONFLICTING FINANCIAL INTERESTS ........................ 29
 

§ 2635.401 Overview. ................................................... 29
 

§ 2635.402 Disqualifying financial interests. ................................. 29
 

§ 2635.403 Prohibited financial interests. .................................... 35
 

SUBPART E - IMPARTIALITY IN PERFORMING OFFICIAL DUTIES ............ 38
 

§ 2635.501 Overview. ................................................... 38
 

§ 2635.502 Personal and business relationships. ............................... 39
 

§ 2635.503 Extraordinary payments from former employers. ..................... 43
 

SUBPART F - SEEKING OTHER EMPLOYMENT .............................. 45
 

§ 2635.601 Overview. ................................................... 45
 

§ 2635.602 Applicability and related considerations. ........................... 45
 

§ 2635.603 Definitions. .................................................. 46
 

§ 2635.604 Disqualification while seeking employment. ........................ 49
 

§ 2635.605 Waiver or authorization permitting participation 
 

while seeking employment. ..................................... 51
 

§ 2635.606 Disqualification based on an arrangement concerning 
 

prospective employment or otherwise after negotiations. .............. 51
 

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SUBPART G - MISUSE OF POSITION ......................................... 53
 

§ 2635.701 Overview. ................................................... 53
 

§ 2635.702 Use of public office for private gain. .............................. 53
 

§ 2635.703 Use of nonpublic information. ................................... 55
 

§ 2635.704 Use of Government property. .................................... 56
 

§ 2635.705 Use of official time. ........................................... 57
 

SUBPART H - OUTSIDE ACTIVITIES ......................................... 59
 

§ 2635.801 Overview. ................................................... 59
 

§ 2635.802 Conflicting outside employment and activities. ...................... 61
 

§ 2635.803 Prior approval for outside employment and activities. ................. 61
 

§ 2635.804 Outside earned income limitations applic able to certain 
 

Presidential appointees and other noncareer employees. ............... 62
 

§ 2635.805 Service as an expert witness. .................................... 63
 

§ 2635.806 Participation in professional associations. [Reserved] ................ 64
 

§ 2635.807 Teaching, speaking and writing. .................................. 64
 

§ 2635.808 Fundraising activities. .......................................... 72
 

§ 2635.809 Just financial obligations. ....................................... 75
 

SUBPART I - RELATED STATUTORY AUTHORITIES .......................... 76
 

§ 2635.901 General. ..................................................... 76
 

§ 2635.902 Related statutes. .............................................. 76
 

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PART 2635 - STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES 

OF THE EXECUTIVE BRANCH 

SUBPART A - GENERAL PROVISIONS 

§ 2635.101 Basic obligation of public service. 

(a)	 Public service is a public trust. Each employee has a responsibility to the United States 

Government and its citizens to place loyalty to the Constitution, laws and ethical principles 

above private gain. To ensure that every citizen can have complete confidence in the integrity 

of the Federal Government, each employee shall respect and adhere to the principles of ethical 

conduct set forth in this section, as well as the implementing standards contained in this part 

and in supplemental agency regulations. 

(b)	 General principles. The following general principles apply to every employee and may form 

the basis for the standards contained in this part. Where a situation is not covered by the 

standards set forth in this part, employees shall apply the principles set forth in this section in 

determining whether their conduct is proper. 

(1)	 Public service is a public trust, requiring employees to place loyalty to the Constitution, 

the laws and ethical principles above private gain. 

(2)	 Employees shall not hold financial interests that conflict with the conscientious 

performance of duty. 

(3)	 Employees shall not engage in financial transactions using nonpublic Government 

information or allow the improper use of such information to further any private 

interest. 

(4)	 An employee shall not, except as permitted by subpart B of this part, solicit or accept 

any gift or other item of monetary value from any person or entity seeking official 

action from, doing business with, or conducting activities regulated by the employee's 

agency, or whose interests may be substantially affected by the performance or 

nonperformance of the employee's duties. 

(5) Employees shall put forth honest effort in the performance of their duties. 

(6)	 Employees shall not knowingly make unauthorized commitments or promises of any 

kind purporting to bind the Government. 

(7) Employees shall not use public office for private gain. 

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(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 race, color, religion, sex, national origin, age, or handicap. 

(14) Employees shall endeavor to avoid any actions creating the appearance that they are 

violating the law or the ethical standards set forth in this part. Whether particular 

circumstances create an appearance that the law or these standards have been violated 

shall be determined from the perspective of a reasonable person with knowledge of the 

relevant facts. 

(c) Related statutes. In addition to the standards of ethical conduct set forth in this part, there are 

conflict of interest statutes that prohibit certain conduct. Criminal conflict of interest statutes 

of general applicability to all employees, 18 U.S.C. 201, 203, 205, 208, and 209, are 

summarized in the appropriate subparts of this part and must be taken into consideration in 

determining whether conduct is proper. Citations to other generally applicable statutes relating 

to employee conduct are set forth in subpart I and employees are further cautioned that there 

may be additional statutory and regulatory restrictions applicable to them generally or as 

employees of their specific agencies. Because an employee is considered to be on notice of the 

requirements of any statute, an employee should not rely upon any description or synopsis of 

a statutory restriction, but should refer to the statute itself and obtain the advice of an agency 

ethics official as needed. 

§ 2635.102 Definitions. 

The definitions listed below are used throughout this part. Additional definitions appear in the 

subparts or sections of subparts to which they apply. For purposes of this part: 

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(a)	 Agency means an executive agency as defined in 5 U.S.C. 105 and the Postal Service and the 

Postal Rate Commission. It does not include the General Accounting Office or the Government 

of the District of Columbia. 

(b)	 Agency designee refers to any employee who, by agency regulation, instruction, or other 

issuance, has been delegated authority to make any determination, give any approval, or take 

any other action required or permitted by this part with respect to another employee. An 

agency may delegate these authorities to any number of agency designees necessary to ensure 

that determinations are made, approvals are given, and other actions are taken in a timely and 

responsible manner. Any provision that requires a determination, approval, or other action by 

the agency designee shall, where the conduct in issue is that of the agency head, be deemed to 

require that such determination, approval or action be made or taken by the agency head in 

consultation with the designated agency ethics official. 

(c)	 Agency ethics official refers to the designated agency ethics official or to the alternate 

designated agency ethics official, referred to in § 2638.202(b) of this chapter, and to any deputy 

ethics official, described in § 2638.204 of this chapter, who has been delegated authority to 

assist in carrying out the responsibilities of the designated agency ethics official. 

(d)	 Agency programs or operations refers to any program or function carried out or performed by 

an agency, whether pursuant to statute, Executive order, or regulation. 

(e)	 Corrective action includes any action necessary to remedy a past violation or prevent a 

continuing violation of this part, including but not limited to restitution, change of assignment, 

disqualification, divestiture, termination of an activity, waiver, the creation of a qualified 

diversified or blind trust, or counseling. 

(f)	 Designated agency ethics official refers to the official designated under § 2638.201 of this 

chapter. 

(g)	 Disciplinary action includes those disciplinary actions referred to in Office of Personnel 

Management regulations and instructions implementing provisions of title 5 of the United 

States Code or provided for in comparable provisions applicable to employees not subject to 

title 5, including but not limited to reprimand, suspension, demotion, and removal. In the case 

of a military officer, comparable provisions may include those in the Uniform Code of Military 

Justice. 

(h)	 Employee means any officer or employee of an agency, including a special Government 

employee. It includes officers but not enlisted members of the uniformed services. For 

purposes other than subparts B and C of this part, it does not include the President or Vice 

President. Status as an employee is unaffected by pay or leave 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. 

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(i)	 Head of an agency means, in the case of an agency headed by more than one person, the chair 

or comparable member of such agency. 

(j) He, his, and him include she, hers and her. 

(k)	 Person means an individual, corporation and subsidiaries it controls, company, association, 

firm, partnership, society, joint stock company, or any other organization or institution, 

including any officer, employee, or agent of such person or entity. For purposes of this part, 

a corporation will be deemed to control a subsidiary if it owns 50 percent or more of the 

subsidiary's voting securities. The term is all-inclusive and applies to commercial ventures and 

nonprofit organizations as well as to foreign, State, and local governments, including the 

Government of the District of Columbia. It does not include any agency or other entity of the 

Federal Government or any officer or employee thereof when acting in his official capacity on 

behalf of that agency or entity. 

(l)	 Special Government employee means those executive branch officers or employees specified 

in 18 U.S.C. 202(a). A special Government employee is retained, designated, appointed, or 

employed to perform temporary duties either on a full-time or intermittent basis, with or 

without compensation, for a period not to exceed 130 days during any consecutive 365-day 

period. 

(m) Supplemental agency regulation means a regulation issued pursuant to § 2635.105. 

§ 2635.103 Applicability to members of the uniformed services. 

The provisions of this part, except this section, are not applicable to enlisted members of the 

uniformed services. Each agency with jurisdiction over enlisted members of the uniformed services 

shall issue regulations defining the ethical conduct obligations of enlisted members under its 

jurisdiction. Those regulations shall be consistent with Executive Order 12674, April 12, 1989, as 

modified, and may prescribe the full range of statutory and regulatory sanctions, including those 

available under the Uniform Code of Military Justice, for failure to comply with such regulations. 

§ 2635.104 Applicability to employees on detail. 

(a)	 Details to other agencies. Except as provided in paragraph (d) of this section, an employee on 

detail, including a uniformed officer on assignment, from his employing agency to another 

agency for a period in excess of 30 calendar days shall be subject to any supplemental agency 

regulations of the agency to which he is detailed rather than to any supplemental agency 

regulations of his employing agency. 

(b)	 Details to the legislative or judicial branch. An employee on detail, including a uniformed 

officer on assignment, from his employing agency to the legislative or judicial branch for a 

period in excess of 30 calendar days shall be subject to the ethical standards of the branch or 

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entity to which detailed. For the duration of any such detail or assignment, the employee shall 

not be subject to the provisions of this part, except this section, or, except as provided in 

paragraph (d) of this section, to any supplemental agency regulations of his employing agency, 

but shall remain subject to the conflict of interest prohibitions in title 18 of the United States 

Code. 

(c)	 Details to non-Federal entities. Except to the extent exempted in writing pursuant to this 

paragraph, an employee detailed to a non-Federal entity remains subject to this part and to any 

supplemental agency regulation of his employing agency. When an employee is detailed 

pursuant to statutory authority to an international organization or to a State or local government 

for a period in excess of six months, the designated agency ethics official may grant a written 

exemption from subpart B of this part based on his determination that the entity has adopted 

written ethical standards covering solicitation and acceptance of gifts which will apply to the 

employee during the detail and which will be appropriate given the purpose of the detail. 

(d)	 Applicability of special agency statutes. Notwithstanding paragraphs (a) and (b) of this section, 

an employee who is subject to an agency statute which restricts his activities or financial 

holdings specifically because of his status as an employee of that agency shall continue to be 

subject to any provisions in the supplemental agency regulations of his employing agency that 

implement that statute. 

§ 2635.105 Supplemental agency regulations. 

In addition to the regulations set forth in this part, an employee shall comply with any supplemental 

agency regulations issued by his employing agency under this section. 

(a)	 An agency that wishes to supplement this part shall prepare and submit to the Office of 

Government Ethics, for its concurrence and joint issuance, any agency regulations that 

supplement the regulations contained in this part. Supplemental agency regulations which the 

agency determines are necessary and appropriate, in view of its programs and operations, to 

fulfill the purposes of this part shall be: 

(1) In the form of a supplement to the regulations in this part; and 

(2) In addition to the substantive provisions of this part. 

(b)	 After concurrence and co-signature by the Office of Government Ethics, the agency shall 

submit its supplemental agency regulations to the Federal Register for publication and 

codification at the expense of the agency in title 5 of the Code of Federal Regulations. 

Supplemental agency regulations issued under this section are effective only after concurrence 

and co-signature by the Office of Government Ethics and publication in the Federal Register. 

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(c)	 This section applies to any supplemental agency regulations or amendments thereof issued 

under this part. It does not apply to: 

(1)	 A handbook or other issuance intended merely as an explanation of the standards 

contained in this part or in supplemental agency regulations; 

(2) An instruction or other issuance the purpose of which is to: 

(i)	 Delegate to an agency designee authority to make any determination, give any 

approval or take any other action required or permitted by this part or by 

supplemental agency regulations; or 

(ii)	 Establish internal agency procedures for documenting or processing any 

determination, approval or other action required or permitted by this part or by 

supplemental agency regulations, or for retaining any such documentation; or 

(3)	 Regulations or instructions that an agency has authority, independent of this part, to 

issue, such as regulations implementing an agency's gift acceptance statute, protecting 

categories of nonpublic information or establishing standards for use of Government 

vehicles. Where the content of any such regulations or instructions was included in the 

agency's standards of conduct regulations issued pursuant to Executive Order 11222 and 

the Office of Government Ethics concurs that they need not be issued as part of an 

agency's supplemental agency regulations, those regulations or instructions may be 

promulgated separately from the agency's supplemental agency regulations. 

§ 2635.106 Disciplinary and corrective action. 

(a)	 Except as provided in § 2635.107, a violation of this part or of supplemental agency regulations 

may be cause for appropriate corrective or disciplinary action to be taken under applicable 

Governmentwide regulations or agency procedures. Such action may be in addition to any 

action or penalty prescribed by law. 

(b)	 It is the responsibility of the employing agency to initiate appropriate disciplinary or corrective 

action in individual cases. However, corrective action may be ordered or disciplinary action 

recommended by the Director of the Office of Government Ethics under the procedures at part 

2638 of this chapter. 

(c)	 A violation of this part or of supplemental agency regulations, as such, does not create any right 

or benefit, substantive or procedural, enforceable at law by any person against the United 

States, its agencies, its officers or employees, or any other person. Thus, for example, an 

individual who alleges that an employee has failed to adhere to laws and regulations that 

provide equal opportunity regardless of race, color, religion, sex, national origin, age, or 

handicap is required to follow applicable statutory and regulatory procedures, including those 

of the Equal Employment Opportunity Commission. 

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§ 2635.107 Ethics advice. 

(a)	 As required by §§ 2638.201 and 2638.202(b) of this chapter, each agency has a designated 

agency ethics official who, on the agency's behalf, is responsible for coordinating and managing 

the agency's ethics program, as well as an alternate. The designated agency ethics official has 

authority under § 2638.204 of this chapter to delegate certain responsibilities, including that 

of providing ethics counseling regarding the application of this part, to one or more deputy 

ethics officials. 

(b)	 Employees who have questions about the application of this part or any supplemental agency 

regulations to particular situations should seek advice from an agency ethics official. 

Disciplinary action for violating this part or any supplemental agency regulations will not be 

taken against an employee who has engaged in conduct in good faith reliance upon the advice 

of an agency ethics official, provided that the employee, in seeking such advice, has made full 

disclosure of all relevant circumstances. Where the employee's conduct violates a criminal 

statute, reliance on the advice of an agency ethics official cannot ensure that the employee will 

not be prosecuted under that statute. However, good faith reliance on the advice of an agency 

ethics official is a factor that may be taken into account by the Department of Justice in the 

selection of cases for prosecution. Disclosures made by an employee to an agency ethics 

official are not protected by an attorney-client privilege. An agency ethics official is required 

by 28 U.S.C. 535 to report any information he receives relating to a violation of the criminal 

code, title 18 of the United States Code. 

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SUBPART B - GIFTS FROM OUTSIDE SOURCES 

§ 2635.201 Overview. 

This subpart contains standards that prohibit an employee from soliciting or accepting any gift from 

a prohibited source or given because of the employee's official position unless the item is excluded 

from the definition of a gift or falls within one of the exceptions set forth in this subpart. 

§ 2635.202 General standards. 

(a)	 General prohibitions. Except as provided in this subpart, an employee shall not, directly or 

indirectly, solicit or accept a gift: 

(1) From a prohibited source; or 

(2) Given because of the employee's official position. 

(b)	 Relationship to illegal gratuities statute. Unless accepted in violation of paragraph (c)(1) of 

this section, a gift accepted under the standards set forth in this subpart shall not constitute an 

illegal gratuity otherwise prohibited by 18 U.S.C. 201(c)(1)(B). 

(c)	 Limitations on use of exceptions. Notwithstanding any exception provided in this subpart, other 

than § 2635.204(j), an employee shall not: 

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

(2) Solicit or coerce the offering of a gift; 

(3)	 Accept gifts from the same or different sources on a basis so frequent that a reasonable 

person would be led to believe the employee is using his public office for private gain; 

Example 1: A purchasing agent for a Veterans Administration hospital routinely deals 

with representatives of pharmaceutical manufacturers who provide information about 

new company products. Because of his crowded calendar, the purchasing agent has 

offered to meet with manufacturer representatives during his lunch hours Tuesdays 

through Thursdays and the representatives routinely arrive at the employee's office 

bringing a sandwich and a soft drink for the employee. Even though the market value 

of each of the lunches is less than $6 and the aggregate value from any one 

manufacturer does not exceed the $50 aggregate limitation in § 2635.204(a) on de 

minimis gifts of $20 or less, the practice of accepting even these modest gifts on a 

recurring basis is improper. 

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(4)	 Accept a gift in violation of any statute. Relevant statutes applicable to all employees 

include: 

(i)	 18 U.S.C. 201(b), which prohibits a public official from seeking, accepting, or 

agreeing to receive or accept anything of value in return for being influenced in 

the performance of an official act or for being induced to take or omit to take any 

action in violation of his official duty. As used in 18 U.S.C. 201(b), the term 

"public official" is broadly construed and includes regular and special 

Government employees as well as all other Government officials; and 

(ii)	 18 U.S.C. 209, which prohibits an employee, other than a special Government 

employee, from receiving any salary or any contribution to or supplementation of 

salary from any source other than the United States as compensation for services 

as a Government employee. The statute contains several specific exceptions to 

this general prohibition, including an exception for contributions made from the 

treasury of a State, county, or municipality; or 

(5)	 Accept vendor promotional training contrary to applicable regulations, policies or 

guidance relating to the procurement of supplies and services for the Government, 

except pursuant to § 2635.204(l). 

§ 2635.203 Definitions. 

For purposes of this subpart, the following definitions shall apply: 

(a)	 Agency has the meaning set forth in § 2635.102(a). However, for purposes of this subpart, an 

executive department, as defined in 5 U.S.C. 101, may, by supplemental agency regulation, 

designate as a separate agency any component of that department which the department 

determines exercises distinct and separate functions. 

(b)	 Gift includes any gratuity, favor, discount, entertainment, hospitality, loan, forbearance, or 

other item having monetary value. It includes services as well as gifts of training, 

transportation, local travel, lodgings and meals, whether provided in-kind, by purchase of a 

ticket, payment in advance, or reimbursement after the expense has been incurred. It does not 

include: 

(1)	 Modest items of food and refreshments, such as soft drinks, coffee and donuts, offered 

other than as part of a meal; 

(2)	 Greeting cards and items with little intrinsic value, such as plaques, certificates, and 

trophies, which are intended solely for presentation; 

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

public; 

(4)	 Opportunities and benefits, including favorable rates and commercial discounts, 

available to the public or to a class consisting of all Government employees or all 

uniformed military personnel, whether or not restricted on the basis of geographic 

considerations; 

(5)	 Rewards and prizes given to competitors in contests or events, including random 

drawings, open to the public unless the employee's entry into the contest or event is 

required as part of his official duties; 

(6)	 Pension and other benefits resulting from continued participation in an employee 

welfare and benefits plan maintained by a former employer; 

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

Government contract; 

Note: Some airlines encourage those purchasing tickets to join programs that award 

free flights and other benefits to frequent fliers. Any such benefit earned on the basis 

of Government-financed travel belongs to the agency rather than to the employee and 

may be accepted only insofar as provided under 41 CFR part 301-53. 

(8) Any gift accepted by the Government under specific statutory authority, including: 

(i)	 Travel, subsistence, and related expenses accepted by an agency under the 

authority of 31 U.S.C. 1353 in connection with an employee's attendance at a 

meeting or similar function relating to his official duties which takes place away 

from his duty station. The agency's acceptance must be in accordance with the 

implementing regulations at 41 CFR part 304-1; and 

(ii)	 Other gifts provided in-kind which have been accepted by an agency under its 

agency gift acceptance statute; or 

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

(c)	 Market value means the retail cost the employee would incur to purchase the gift. An employee 

who cannot ascertain the market value of a gift may estimate its market value by reference to 

the retail cost of similar items of like quality. The market value of a gift of a ticket entitling the 

holder to food, refreshments, entertainment, or any other benefit shall be the face value of the 

ticket. 

Example 1: An employee who has been given an acrylic paperweight embedded with the 

corporate logo of a prohibited source may determine its market value based on her observation 

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that a comparable acrylic paperweight, not embedded with a logo, generally sells for about 

$20. 

Example 2: A prohibited source has offered an employee a ticket to a charitable event 

consisting of a cocktail reception to be followed by an evening of chamber music. Even though 

the food, refreshments, and entertainment provided at the event may be worth only $20, the 

market value of the ticket is its $250 face value. 

(d) Prohibited source means any person who: 

(1) Is seeking official action by the employee's agency; 

(2) Does business or seeks to do business with the employee's agency; 

(3) Conducts activities regulated by the employee's agency; 

(4)	 Has interests that may be substantially affected by performance or nonperformance of 

the employee's official duties; or 

(5)	 Is an organization a majority of whose members are described in paragraphs (d) (1) 

through (4) of this section. 

(e)	 A gift is solicited or accepted because of the employee's official position if it is from a person 

other than an employee and would not have been solicited, offered, or given had the employee 

not held the status, authority or duties associated with his Federal position. 

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

Example 1: Where free season tickets are offered by an opera guild to all members of the 

Cabinet, the gift is offered because of their official positions. 

Example 2. Employees at a regional office of the Department of Justice (DOJ) work in 

Government-leased space at a private office building, along with various private business 

tenants. A major fire in the building during normal office hours causes a traumatic experience 

for all occupants of the building in making their escape, and it is the subject of widespread 

news coverage. A corporate hotel chain, which does not meet the definition of a prohibited 

source for DOJ, seizes the moment and announces that it will give a free night’s lodging to all 

building occupants and their families, as a public goodwill gesture. Employees of DOJ may 

accept, as this gift is not being given because of their Government positions. The donor’s 

motivation for offering this gift is unrelated to the DOJ employees’ status, authority or duties 

associated with their Federal position, but instead is based on their mere presence in the 

building as occupants at the time of the fire. 

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(f) A gift which is solicited or accepted indirectly includes a gift: 

(1)	 Given with the employee's knowledge and acquiescence to his parent, sibling, spouse, 

child, or dependent relative because of that person's relationship to the employee, or 

(2)	 Given to any other person, including any charitable organization, on the basis of 

designation, recommendation, or other specification by the employee, except as 

permitted for the disposition of perishable items by § 2635.205(a)(2) or for payments 

made to charitable organizations in lieu of honoraria under § 2636.204 of this chapter. 

Example 1: An employee who must decline a gift of a personal computer pursuant to this 

subpart may not suggest that the gift be given instead to one of five charitable organizations 

whose names are provided by the employee. 

(g)	 Vendor promotional training means training provided by any person for the purpose of 

promoting its products or services. It does not include training provided under a Government 

contract or by a contractor to facilitate use of products or services it furnishes under a 

Government contract. 

§ 2635.204 Exceptions. 

The prohibitions set forth in § 2635.202(a) do not apply to a gift accepted under the circumstances 

described in paragraphs (a) through (l) of this section, and an employee’s acceptance of a gift in 

accordance with one of those paragraphs will be deemed not to violate the principles set forth in 

§ 2635.101(b), including appearances. Even though acceptance of a gift may be permitted by one 

of the exceptions contained in paragraphs (a) through (l) of this section, it is never inappropriate and 

frequently prudent for an employee to decline a gift offered by a prohibited source or because of his 

official position. 

(a)	 Gifts of $20 or less. An employee may accept unsolicited gifts having an aggregate market 

value of $20 or less per source per occasion, provided that the aggregate market value of 

individual gifts received from any one person under the authority of this paragraph shall not 

exceed $50 in a calendar year. This exception does not apply to gifts of cash or of investment 

interests such as stock, bonds, or certificates of deposit. Where the market value of a gift or the 

aggregate market value of gifts offered on any single occasion exceeds $20, the employee may 

not pay the excess value over $20 in order to accept that portion of the gift or those gifts worth 

$20. Where the aggregate value of tangible items offered on a single occasion exceeds $20, the 

employee may decline any distinct and separate item in order to accept those items aggregating 

$20 or less. 

Example 1: An employee of the Securities and Exchange Commission and his spouse have been 

invited by a representative of a regulated entity to a Broadway play, tickets to which have a 

face value of $30 each. The aggregate market value of the gifts offered on this single occasion 

is $60, $40 more than the $20 amount that may be accepted for a single event or presentation. 

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The employee may not accept the gift of the evening of entertainment. He and his spouse may 

attend the play only if he pays the full $60 value of the two tickets. 

Example 2: An employee of the Defense Mapping Agency has been invited by an association 

of cartographers to speak about his agency's role in the evolution of missile technology. At the 

conclusion of his speech, the association presents the employee a framed map with a market 

value of $18 and a book about the history of cartography with a market value of $15. The 

employee may accept the map or the book, but not both, since the aggregate value of these two 

tangible items exceeds $20. 

Example 3: On four occasions during the calendar year, an employee of the Defense Logistics 

Agency was given gifts worth $10 each by four employees of a corporation that is a DLA 

contractor. For purposes of applying the yearly $50 limitation on gifts of $20 or less from any 

one person, the four gifts must be aggregated because a person is defined at § 2635.102(k) to 

mean not only the corporate entity, but its officers and employees as well. However, for 

purposes of applying the $50 aggregate limitation, the employee would not have to include the 

value of a birthday present received from his cousin, who is employed by the same corporation, 

if he can accept the birthday present under the exception at § 2635.204(b) for gifts based on 

a personal relationship. 

Example 4: Under the authority of 31 U.S.C. 1353 for agencies to accept payments from 

non-Federal sources in connection with attendance at certain meetings or similar functions, 

the Environmental Protection Agency has accepted an association's gift of travel expenses and 

conference fees for an employee of its Office of Radiation Programs to attend an international 

conference on "The Chernobyl Experience." While at the conference, the employee may accept 

a gift of $20 or less from the association or from another person attending the conference even 

though it was not approved in advance by the EPA. Although 31 U.S.C. 1353 is the only 

authority under which an agency may accept gifts from certain non-Federal sources in 

connection with its employees' attendance at such functions, a gift of $20 or less accepted 

under § 2635.204(a) is a gift to the employee rather than to his employing agency. 

Example 5: During off-duty time, an employee of the Department of Defense (DOD) attends 

a trade show involving companies that are DOD contractors. He is offered a $15 computer 

program disk at X Company’s booth, a $12 appointments calendar at Y Company’s booth, and 

a deli lunch worth $8 from Z Company. The employee may accept all three of these items 

because they do not exceed $20 per source, even though they total more than $20 at this single 

occasion. 

(b)	 Gifts based on a personal relationship. An employee may accept a gift given under 

circumstances which make it clear that the gift is motivated by a family relationship or personal 

friendship rather than the position of the employee. Relevant factors in making such a 

determination include the history of the relationship and whether the family member or friend 

personally pays for the gift. 

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13 10/02/02 
Example 1: An employee of the Federal Deposit Insurance Corporation has been dating a 

secretary employed by a member bank. For Secretary's Week, the bank has given each 

secretary 2 tickets to an off-Broadway musical review and has urged each to invite a family 

member or friend to share the evening of entertainment. Under the circumstances, the FDIC 

employee may accept his girlfriend's invitation to the theater. Even though the tickets were 

initially purchased by the member bank, they were given without reservation to the secretary 

to use as she wished, and her invitation to the employee was motivated by their personal 

friendship. 

Example 2: Three partners in a law firm that handles corporate mergers have invited an 

employee of the Federal Trade Commission to join them in a golf tournament at a private club 

at the firm's expense. The entry fee is $500 per foursome. The employee cannot accept the gift 

of one-quarter of the entry fee even though he and the three partners have developed an 

amicable relationship as a result of the firm's dealings with the FTC. As evidenced in part by 

the fact that the fees are to be paid by the firm, it is not a personal friendship but a business 

relationship that is the motivation behind the partners' gift. 

(c)	 Discounts and similar benefits. In addition to those opportunities and benefits excluded from 

the definition of a gift by § 2635.203(b)(4), an employee may accept: 

(1)	 Reduced membership or other fees for participation in organization activities offered 

to all Government employees or all uniformed military personnel by professional 

organizations if the only restrictions on membership relate to professional 

qualifications; and 

(2)	 Opportunities and benefits, including favorable rates and commercial discounts not 

precluded by paragraph (c)(3) of this section: 

(i)	 Offered to members of a group or class in which membership is unrelated to 

Government employment; 

(ii)	 Offered to members of an organization, such as an employees' association or 

agency credit union, in which membership is related to Government employment 

if the same offer is broadly available to large segments of the public through 

organizations of similar size; or 

(iii)	 Offered by a person who is not a prohibited source to any group or class that is 

not defined in a manner that specifically discriminates among Government 

employees on the basis of type of official responsibility or on a basis that favors 

those of higher rank or rate of pay; provided, however, that 

(3)	 An employee may not accept for personal use any benefit to which the Government is 

entitled as the result of an expenditure of Government funds. 

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Example 1: An employee of the Consumer Product Safety Commission may accept a 

discount of $50 on a microwave oven offered by the manufacturer to all members of the 

CPSC employees' association. Even though the CPSC is currently conducting studies 

on the safety of microwave ovens, the $50 discount is a standard offer that the 

manufacturer has made broadly available through a number of similar organizations 

to large segments of the public. 

Example 2: An Assistant Secretary may not accept a local country club's offer of 

membership to all members of Department Secretariats which includes a waiver of its 

$5,000 membership initiation fee. Even though the country club is not a prohibited 

source, the offer discriminates in favor of higher ranking officials. 

Example 3: The administrative officer for a district office of the Immigration and 

Naturalization Service has signed an INS order to purchase 50 boxes of photocopy 

paper from a supplier whose literature advertises that it will give a free briefcase to 

anyone who purchases 50 or more boxes. Because the paper was purchased with INS 

funds, the administrative officer cannot keep the briefcase which, if claimed and 

received, is Government property. 

(d) Awards and honorary degrees. 

(1)	 An employee may accept gifts, other than cash or an investment interest, with an 

aggregate market value of $200 or less if such gifts are a bona fide award or incident to 

a bona fide award that is given for meritorious public service or achievement by a 

person who does not have interests that may be substantially affected by the 

performance or nonperformance of the employee's official duties or by an association 

or other organization the majority of whose members do not have such interests. Gifts 

with an aggregate market value in excess of $200 and awards of cash or investment 

interests offered by such persons as awards or incidents of awards that are given for 

these purposes may be accepted upon a written determination by an agency ethics 

official that the award is made as part of an established program of recognition: 

(i)	 Under which awards have been made on a regular basis or which is funded, 

wholly or in part, to ensure its continuation on a regular basis; and 

(ii) Under which selection of award recipients is made pursuant to written standards. 

(2)	 An employee may accept an honorary degree from an institution of higher education as 

defined at 20 U.S.C. 1141(a) based on a written determination by an agency ethics 

official that the timing of the award of the degree would not cause a reasonable person 

to question the employee's impartiality in a matter affecting the institution. 

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(3)	 An employee who may accept an award or honorary degree pursuant to paragraph (d)(1) 

or (2) of this section may also accept meals and entertainment given to him and to 

members of his family at the event at which the presentation takes place. 

Example 1: Based on a determination by an agency ethics official that the prize meets 

the criteria set forth in § 2635.204(d)(1), an employee of the National Institutes of 

Health may accept the Nobel Prize for Medicine, including the cash award which 

accompanies the prize, even though the prize was conferred on the basis of laboratory 

work performed at NIH. 

Example 2: Prestigious University wishes to give an honorary degree to the Secretary 

of Labor. The Secretary may accept the honorary degree only if an agency ethics 

official determines in writing that the timing of the award of the degree would not cause 

a reasonable person to question the Secretary's impartiality in a matter affecting the 

university. 

Example 3: An ambassador selected by a nonprofit organization as recipient of its 

annual award for distinguished service in the interest of world peace may, together with 

his wife, and children, attend the awards ceremony dinner and accept a crystal bowl 

worth $200 presented during the ceremony. However, where the organization has also 

offered airline tickets for the ambassador and his family to travel to the city where the 

awards ceremony is to be held, the aggregate value of the tickets and the crystal bowl 

exceeds $200 and he may accept only upon a written determination by the agency ethics 

official that the award is made as part of an established program of recognition. 

(e)	 Gifts based on outside business or employment relationships. An employee may accept meals, 

lodgings, transportation and other benefits: 

(1)	 Resulting from the business or employment activities of an employee's spouse when it 

is clear that such benefits have not been offered or enhanced because of the employee's 

official position; 

Example 1: A Department of Agriculture employee whose husband is a computer 

programmer employed by an Agriculture Department contractor may attend the 

company's annual retreat for all of its employees and their families held at a resort 

facility. However, under § 2635.502, the employee may be disqualified from performing 

official duties affecting her husband's employer. 

Example 2: Where the spouses of other clerical personnel have not been invited, an 

employee of the Defense Contract Audit Agency whose wife is a clerical worker at a 

defense contractor may not attend the contractor's annual retreat in Hawaii for 

corporate officers and members of the board of directors, even though his wife received 

a special invitation for herself and her spouse. 

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(2)	 Resulting from his outside business or employment activities when it is clear that such 

benefits have not been offered or enhanced because of his official status; or 

Example 1: The members of an Army Corps of Engineers environmental advisory 

committee that meets 6 times per year are special Government employees. A member 

who has a consulting business may accept an invitation to a $50 dinner from her 

corporate client, an Army construction contractor, unless, for example, the invitation 

was extended in order to discuss the activities of the committee. 

(3)	 Customarily provided by a prospective employer in connection with bona fide 

employment discussions. If the prospective employer has interests that could be 

affected by performance or nonperformance of the employee's duties, acceptance is 

permitted only if the employee first has complied with the disqualification requirements 

of subpart F of this part applicable when seeking employment. 

Example 1: An employee of the Federal Communications Commission with 

responsibility for drafting regulations affecting all cable television companies wishes 

to apply for a job opening with a cable television holding company. Once she has 

properly disqualified herself from further work on the regulations as required by 

subpart F of this part, she may enter into employment discussions with the company and 

may accept the company's offer to pay for her airfare, hotel and meals in connection 

with an interview trip. 

(4)	 For purposes of paragraphs (e)(1) through (3) of this section, employment shall have the 

meaning set forth in § 2635.603(a). 

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

An employee who, in accordance with the Hatch Act Reform Amendments of 1993, at 5 U.S.C. 

7323, may take an active part in political management or in political campaigns, may accept 

meals, lodgings, transportation and other benefits, including free attendance at events, when 

provided, in connection with such active participation, by a political organization described in 

26 U.S.C. 527(e). Any other employee, such as a security officer, whose official duties require 

him to accompany an employee to a political event may accept meals, free attendance and 

entertainment provided at the event by such an organization. 

Example 1: The Secretary of the Department of Health and Human Services may accept an 

airline ticket and hotel accommodations furnished by the campaign committee of a candidate 

for the United States Senate in order to give a speech in support of the candidate. 

(g)	 Widely attended gatherings and other events--(1) Speaking and similar engagements. When 

an employee is assigned to participate as a speaker or panel participant or otherwise to present 

information on behalf of the agency at a conference or other event, his acceptance of an offer 

of free attendance at the event on the day of his presentation is permissible when provided by 

the sponsor of the event. The employee's participation in the event on that day is viewed as a 

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customary and necessary part of his performance of the assignment and does not involve a gift

to him or to the agency. 

(2) Widely attended gatherings. When there has been a determination that his attendance

is in the interest of the agency because it will further agency programs and operations,

an employee may accept an unsolicited gift of free attendance at all or appropriate parts

of a widely attended gathering of mutual interest to a number of parties from the sponsor

of the event or, if more than 100 persons are expected to attend the event and the gift of

free attendance has a market value of $285 or less, from a person other than the sponsor

of the event. A gathering is widely attended if it is expected that a large number of

persons will attend and that persons with a diversity of views or interests will be present,

for example, if it is open to members from throughout the interested industry or

profession or if those in attendance represent a range of persons interested in a given

matter. For employees subject to a leave system, attendance at the event shall be on the

employee's own time or, if authorized by the employee's agency, on excused absence

pursuant to applicable guidelines for granting such absence, or otherwise without charge

to the employee's leave account.

(3) Determination of agency interest. The determination of agency interest required by

paragraph (g)(2) of this section shall be made orally or in writing by the agency

designee.

(i) If the person who has extended the invitation has interests that may be substantially

affected by the performance or nonperformance of an employee's official duties or

is an association or organization the majority of whose members have such

interests, the employee's participation may be determined to be in the interest of

the agency only where there is a written finding by the agency designee that the

agency's interest in the employee's participation in the event outweighs the concern

that acceptance of the gift of free attendance may or may not appear to improperly

influence the employee in the performance of his official duties. Relevant factors

that should be considered by the agency designee include the importance of the

event to the agency, the nature and sensitivity of any pending matter affecting the

interests of the person who has extended the invitation, the significance of the

employee's role in any such matter, the purpose of the event, the identity of other

expected participants and the market value of the gift of free attendance.

(ii) A blanket determination of agency interest may be issued to cover all or any

category of invitees other than those as to whom the finding is required by

paragraph (g)(3)(i) of this section. Where a finding under paragraph (g)(3)(i) of

this section is required, a written determination of agency interest, including the

necessary finding, may be issued to cover two or more employees whose duties

similarly affect the interests of the person who has extended the invitation or,

where that person is an association or organization, of its members.
(4)	 Free attendance. For purposes of paragraphs (g)(1) and (g)(2) of this section, free 

attendance may include waiver of all or part of a conference or other fee or the provision 

of food, refreshments, entertainment, instruction and materials furnished to all attendees 

as an integral part of the event. It does not include travel expenses, lodgings, 

entertainment collateral to the event, or meals taken other than in a group setting with 

all other attendees. Where the invitation has been extended to an accompanying spouse 

or other guest (see paragraph (g)(6) of this section), the market value of the gift of free 

attendance includes the market value of free attendance by the spouse or other guest as 

well as the market value of the employee's own attendance. 

Note: There are statutory authorities implemented other than by part 2635 under which 

an agency or an employee may be able to accept free attendance or other items not 

included in the definition of free attendance, such as travel expenses. 

(5)	 Cost provided by sponsor of event. The cost of the employee's attendance will not be 

considered to be provided by the sponsor, and the invitation is not considered to be from 

the sponsor of the event, where a person other than the sponsor designates the employee 

to be invited and bears the cost of the employee's attendance through a contribution or 

other payment intended to facilitate that employee's attendance. Payment of dues or a 

similar assessment to a sponsoring organization does not constitute a payment intended 

to facilitate a particular employee's attendance. 

(6)	 Accompanying spouse or other guest. When others in attendance will generally be 

accompanied by a spouse or other guest, and where the invitation is from the same 

person who has invited the employee, the agency designee may authorize an employee 

to accept an unsolicited invitation of free attendance to an accompanying spouse or to 

another accompanying guest to participate in all or a portion of the event at which the 

employee's free attendance is permitted under paragraph (g)(1) or (g)(2) of this section. 

The authorization required by this paragraph may be provided orally or in writing. 

Example 1: An aerospace industry association that is a prohibited source sponsors an 

industrywide, two-day seminar for which it charges a fee of $400 and anticipates 

attendance of approximately 400. An Air Force contractor pays $2,000 to the 

association so that the association can extend free invitations to five Air Force officials 

designated by the contractor. The Air Force officials may not accept the gifts of free 

attendance. Because the contractor specified the invitees and bore the cost of their 

attendance, the gift of free attendance is considered to be provided by the company and 

not by the sponsoring association. Had the contractor paid $2,000 to the association 

in order that the association might invite any five Federal employees, an Air Force 

official to whom the sponsoring association extended one of the five invitations could 

attend if his participation were determined to be in the interest of the agency. The Air 

Force official could not in any case accept an invitation directly from the nonsponsor 

contractor because the market value of the gift exceeds $285. 

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Example 2: An employee of the Department of Transportation is invited by a news 

organization to an annual press dinner sponsored by an association of press 

organization. Tickets for the event cost $285 per person and attendance is limited to 400 

representatives of press organizations and their guests. If the employee's attendance is 

determined to be in the interest of the agency, she may accept the invitation from the 

news organization because more than 100 persons will attend and the cost of the ticket 

does not exceed $285. However, if the invitation were extended to the employee and an 

accompanying guest, her guest could not be authorized to attend for free since the 

market value of the gift of free attendance would be $570 and the invitation is from a 

person other than the sponsor of the event. 

Example 3: An employee of the Department of Energy (DOE) and his wife have been 

invited by a major utility executive to a small dinner party. A few other officials of the 

utility and their spouses or other guests are also invited, as is a representative of a 

consumer group concerned with utility rates and her husband. The DOE official 

believes the dinner party will provide him an opportunity to socialize with and get to 

know those in attendance. The employee may not accept the free invitation under this 

exception, even if his attendance could be determined to be in the interest of the agency. 

The small dinner party is not a widely attended gathering. Nor could the employee be 

authorized to accept even if the event were instead a corporate banquet to which forty 

company officials and their spouses or other guests were invited. In this second case, 

notwithstanding the larger number of persons expected (as opposed to the small dinner 

party just noted) and despite the presence of the consumer group representative and her 

husband who are not officials of the utility, those in attendance would still not represent 

a diversity of views or interests. Thus, the company banquet would not qualify as a 

widely attended gathering under those circumstances either. 

Example 4: An employee of the Department of the Treasury authorized to participate 

in a panel discussion of economic issues as part of a one-day conference may accept the 

sponsor's waiver of the conference fee. Under the separate authority of § 2635.204(a), 

he may accept a token of appreciation for his speech having a market value of $20 or 

less. 

Example 5: An Assistant U.S. Attorney is invited to attend a luncheon meeting of a 

local bar association to hear a distinguished judge lecture on cross-examining expert 

witnesses. Although members of the bar association are assessed a $15 fee for the 

meeting, the Assistant U.S. Attorney may accept the bar association's offer to attend for 

free, even without a determination of agency interest. The gift can be accepted under 

the $20 de minimis exception at § 2635.204(a). 

Example 6: An employee of the Department of the Interior authorized to speak on the 

first day of a four-day conference on endangered species may accept the sponsor's 

waiver of the conference fee for the first day of the conference. If the conference is 

widely attended, he may be authorized, based on a determination that his attendance is 

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in the agency's interest, to accept the sponsor's offer to waive the attendance fee for the 

remainder of the conference. 

(h)	 Social invitations from persons other than prohibited sources. An employee may accept food, 

refreshments and entertainment, not including travel or lodgings, at a social event attended by 

several persons where: 

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

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

Example 1: Along with several other Government officials and a number of individuals 

from the private sector, the Administrator of the Environmental Protection Agency has 

been invited to the premier showing of a new adventure movie about industrial 

espionage. The producer is paying all costs of the showing. The Administrator may 

accept the invitation since the producer is not a prohibited source and no attendance fee 

is being charged to anyone who has been invited. 

Example 2: An employee of the White House Press Office has been invited to a cocktail 

party given by a noted Washington hostess who is not a prohibited source. The 

employee may attend even though he has only recently been introduced to the hostess 

and suspects that he may have been invited because of his official position. 

(i)	 Meals, refreshments and entertainment in foreign areas. An employee assigned to duty in, or 

on official travel to, a foreign area as defined in 41 CFR 301-7.3(c) may accept food, 

refreshments or entertainment in the course of a breakfast, luncheon, dinner or other meeting 

or event provided: 

(1)	 The market value in the foreign area of the food, refreshments or entertainment provided 

at the meeting or event, as converted to U.S. dollars, does not exceed the per diem rate 

for the foreign area specified in the U.S. Department of State's Maximum Per Diem 

Allowances for Foreign Areas, Per Diem Supplement Section 925 to the Standardized 

Regulations (GC, FA) available from the Superintendent of Documents, U.S. 

Government Printing Office, Washington, DC 20402; 

(2)	 There is participation in the meeting or event by non-U.S. citizens or by representatives 

of foreign governments or other foreign entities; 

(3)	 Attendance at the meeting or event is part of the employee's official duties to obtain 

information, disseminate information, promote the export of U.S. goods and services, 

represent the United States or otherwise further programs or operations of the agency or 

the U.S. mission in the foreign area; and 

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(4)	 The gift of meals, refreshments or entertainment is from a person other than a foreign 

government as defined in 5 U.S.C. 7342(a)(2). 

Example 1: A number of local businessmen in a developing country are anxious for a 

U.S. company to locate a manufacturing facility in their province. An official of the 

Overseas Private Investment Corporation may accompany the visiting vice president of 

the U.S. company to a dinner meeting hosted by the businessmen at a province 

restaurant where the market value of the food and refreshments does not exceed the per 

diem rate for that country. 

(j)	 Gifts to the President or Vice President. Because of considerations relating to the conduct of 

their offices, including those of protocol and etiquette, the President or the Vice President may 

accept any gift on his own behalf or on behalf of any family member, provided that such 

acceptance does not violate § 2635.202(c) (1) or (2), 18 U.S.C. 201(b) or 201(c)(3), or the 

Constitution of the United States. 

(k)	 Gifts authorized by supplemental agency regulation. An employee may accept any gift the 

acceptance of which is specifically authorized by a supplemental agency regulation. 

(l)	 Gifts accepted under specific statutory authority. The prohibitions on acceptance of gifts from 

outside sources contained in this subpart do not apply to any item, receipt of which is 

specifically authorized by statute. Gifts which may be received by an employee under the 

authority of specific statutes include, but are not limited to: 

(1)	 Free attendance, course or meeting materials, transportation, lodgings, food and 

refreshments or reimbursements therefor incident to training or meetings when accepted 

by the employee under the authority of 5 U.S.C. 4111 from an organization with 

tax-exempt status under 26 U.S.C. 501(c)(3) or from a person to whom the prohibitions 

in 18 U.S.C. 209 do not apply. The employee's acceptance must be approved by the 

agency in accordance with part 410 of this title; or 

Note: 26 U.S.C. 501(c)(3) is authority for tax-exempt treatment of a limited class of 

nonprofit organizations, including those organized and operated for charitable, religious 

or educational purposes. Many nonprofit organizations are not exempt from taxation 

under this section. 

(2)	 Gifts from a foreign government or international or multinational organization, or its 

representative, when accepted by the employee under the authority of the Foreign Gifts 

and Decorations Act, 5 U.S.C. 7342. As a condition of acceptance, an employee must 

comply with requirements imposed by the agency's regulations or procedures 

implementing that Act. 

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§ 2635.205 Proper disposition of prohibited gifts. 

(a)	 An employee who has received a gift that cannot be accepted under this subpart shall, unless 

the gift is accepted by an agency acting under specific statutory authority: 

(1)	 Return any tangible item to the donor or pay the donor its market value. An employee 

who cannot ascertain the actual market value of an item may estimate its market value 

by reference to the retail cost of similar items of like quality. See § 2635.203(c). 

Example 1: To avoid public embarrassment to the seminar sponsor, an employee of the 

National Park Service did not decline a barometer worth $200 given at the conclusion 

of his speech on Federal lands policy. The employee must either return the barometer 

or promptly reimburse the sponsor $200. 

(2)	 When it is not practical to return a tangible item because it is perishable, the item may, 

at the discretion of the employee's supervisor or an agency ethics official, be given to an 

appropriate charity, shared within the recipient's office, or destroyed. 

Example 1: With approval by the recipient's supervisor, a floral arrangement sent by 

a disability claimant to a helpful employee of the Social Security Administration may be 

placed in the office's reception area. 

(3)	 For any entertainment, favor, service, benefit or other intangible, reimburse the donor 

the market value. Subsequent reciprocation by the employee does not constitute 

reimbursement. 

Example 1: A Department of Defense employee wishes to attend a charitable event to 

which he has been offered a $300 ticket by a prohibited source. Although his attendance 

is not in the interest of the agency under § 2635.204(g), he may attend if he reimburses 

the donor the $300 face value of the ticket. 

(4)	 Dispose of gifts from foreign governments or international organizations in accordance 

with 41 CFR part 101-49, and dispose of materials received in conjunction with official 

travel in accordance with 41 CFR 101-25.103. 

(b)	 An agency may authorize disposition or return of gifts at Government expense. Employees 

may use penalty mail to forward reimbursements required or permitted by this section. 

(c)	 An employee who, on his own initiative, promptly complies with the requirements of this 

section will not be deemed to have improperly accepted an unsolicited gift. An employee who 

promptly consults his agency ethics official to determine whether acceptance of an unsolicited 

gift is proper and who, upon the advice of the ethics official, returns the gift or otherwise 

disposes of the gift in accordance with this section, will be considered to have complied with 

the requirements of this section on his own initiative. 

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SUBPART C - GIFTS BETWEEN EMPLOYEES 

§ 2635.301 Overview. 

This subpart contains standards that prohibit an employee from giving, donating to, or soliciting 

contributions for, a gift to an official superior and from accepting a gift from an employee receiving 

less pay than himself, unless the item is excluded from the definition of a gift or falls within one of 

the exceptions set forth in this subpart. 

§ 2635.302 General standards. 

(a) Gifts to superiors. Except as provided in this subpart, an employee may not: 

(1)	 Directly or indirectly, give a gift to or make a donation toward a gift for an official 

superior; or 

(2)	 Solicit a contribution from another employee for a gift to either his own or the other 

employee's official superior. 

(b)	 Gifts from employees receiving less pay. Except as provided in this subpart, an employee may 

not, directly or indirectly, accept a gift from an employee receiving less pay than himself 

unless: 

(1) The two employees are not in a subordinate-official superior relationship; and 

(2) There is a personal relationship between the two employees that would justify the gift. 

(c)	 Limitation on use of exceptions. Notwithstanding any exception provided in this subpart, an 

official superior shall not coerce the offering of a gift from a subordinate. 

§ 2635.303 Definitions. 

For purposes of this subpart, the following definitions shall apply: 

(a)	 Gift has the meaning set forth in § 2635.203(b). For purposes of that definition an employee 

will be deemed to have paid market value for any benefit received as a result of his participation 

in any carpool or other such mutual arrangement involving another employee or other 

employees if he bears his fair proportion of the expense or effort involved. 

(b)	 Indirectly, for purposes of § 2635.302(b), has the meaning set forth in § 2635.203(f). For 

purposes of § 2635.302(a), it includes a gift: 

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(1)	 Given with the employee's knowledge and acquiescence by his parent, sibling, spouse, 

child, or dependent relative; or 

(2)	 Given by a person other than the employee under circumstances where the employee has 

promised or agreed to reimburse that person or to give that person something of value 

in exchange for giving the gift. 

(c)	 Subject to paragraph (a) of this section, market value has the meaning set forth in 

§ 2635.203(c). 

(d)	 Official superior means any other employee, other than the President and the Vice President, 

including but not limited to an immediate supervisor, whose official responsibilities include 

directing or evaluating the performance of the employee's official duties or those of any other 

official superior of the employee. For purposes of this subpart, an employee is considered to 

be the subordinate of any of his official superiors. 

(e) Solicit means to request contributions by personal communication or by general announcement. 

(f)	 Voluntary contribution means a contribution given freely, without pressure or coercion. A 

contribution is not voluntary unless it is made in an amount determined by the contributing 

employee, except that where an amount for a gift is included in the cost for a luncheon, 

reception or similar event, an employee who freely chooses to pay a proportionate share of the 

total cost in order to attend will be deemed to have made a voluntary contribution. Except in 

the case of contributions for a gift included in the cost of a luncheon, reception or similar event, 

a statement that an employee may choose to contribute less or not at all shall accompany any 

recommendation of an amount to be contributed for a gift to an official superior. 

Example 1: A supervisory employee of the Agency for International Development has just been 

reassigned from Washington, DC to Kabul, Afghanistan. As a farewell party, 12 of her 

subordinates have decided to take her out to lunch at the Khyber Repast. It is understood that 

each will pay for his own meal and that the cost of the supervisor's lunch will be divided 

equally among the twelve. Even though the amount they will contribute is not determined until 

the supervisor orders lunch, the contribution made by those who choose to participate in the 

farewell lunch is voluntary. 

§ 2635.304 Exceptions. 

The prohibitions set forth in § 2635.302(a) and (b) do not apply to a gift given or accepted under the 

circumstances described in paragraph (a) or (b) of this section. A contribution or the solicitation of 

a contribution that would otherwise violate the prohibitions set forth in § 2635.302(a) and (b) may 

only be made in accordance with paragraph (c) of this section. 

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(a)	 General exceptions. On an occasional basis, including any occasion on which gifts are 

traditionally given or exchanged, the following may be given to an official superior or accepted 

from a subordinate or other employee receiving less pay: 

(1) Items, other than cash, with an aggregate market value of $10 or less per occasion; 

(2) Items such as food and refreshments to be shared in the office among several employees; 

(3)	 Personal hospitality provided at a residence which is of a type and value customarily 

provided by the employee to personal friends; 

(4)	 Items given in connection with the receipt of personal hospitality if of a type and value 

customarily given on such occasions; and 

(5)	 Leave transferred under subpart I of part 630 of this title to an employee who is not an 

immediate supervisor, unless obtained in violation of § 630.912 of this title. 

Example 1: Upon returning to work following a vacation at the beach, a claims 

examiner with the Department of Veterans Affairs may give his supervisor, and his 

supervisor may accept, a bag of saltwater taffy purchased on the boardwalk for $8. 

Example 2: An employee of the Federal Deposit Insurance Corporation whose bank 

examination responsibilities require frequent travel may not bring her supervisor, and 

her supervisor may not accept, souvenir coffee mugs from each of the cities she visits in 

the course of performing her duties, even though each of the mugs costs less than $5. 

Gifts given on this basis are not occasional. 

Example 3: The Secretary of Labor has invited the agency's General Counsel to a 

dinner party at his home. The General Counsel may bring a $15 bottle of wine to the 

dinner party and the Secretary may accept this customary hostess gift from his 

subordinate, even though its cost is in excess of $10. 

Example 4: For Christmas, a secretary may give his supervisor, and the supervisor may 

accept, a poinsettia plant purchased for $10 or less. The secretary may also invite his 

supervisor to a Christmas party in his home and the supervisor may attend. 

(b)	 Special, infrequent occasions. A gift appropriate to the occasion may be given to an official 

superior or accepted from a subordinate or other employee receiving less pay: 

(1)	 In recognition of infrequently occurring occasions of personal significance such as 

marriage, illness, or the birth or adoption of a child; or 

(2)	 Upon occasions that terminate a subordinate-official superior relationship, such as 

retirement, resignation, or transfer. 

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Example 1: The administrative assistant to the personnel director of the Tennessee Valley 

Authority may send a $30 floral arrangement to the personnel director who is in the hospital 

recovering from surgery. The personnel director may accept the gift. 

Example 2: A chemist employed by the Food and Drug Administration has been invited to the 

wedding of the lab director who is his official superior. He may give the lab director and his 

bride, and they may accept, a place setting in the couple's selected china pattern purchased for 

$70. 

Example 3: Upon the occasion of the supervisor's retirement from Federal service, an 

employee of the Fish and Wildlife Service may give her supervisor a book of wildlife 

photographs which she purchased for $19. The retiring supervisor may accept the book. 

(c)	 Voluntary contributions. An employee may solicit voluntary contributions of nominal amounts 

from fellow employees for an appropriate gift to an official superior and an employee may 

make a voluntary contribution of a nominal amount to an appropriate gift to an official superior: 

(1) On a special, infrequent occasion as described in paragraph (b) of this section; or 

(2)	 On an occasional basis, for items such as food and refreshments to be shared in the office 

among several employees. 

An employee may accept such gifts to which a subordinate or other employee receiving less pay 

than himself has contributed. 

Example 1: To mark the occasion of his retirement, members of the immediate staff of the 

Under Secretary of the Army would like to give him a party and provide him with a gift 

certificate. They may distribute an announcement of the party and include a nominal amount 

for a retirement gift in the fee for the party. 

Example 2: The General Counsel of the National Endowment for the Arts may not collect 

contributions for a Christmas gift for the Chairman. Christmas occurs annually and is not an 

occasion of personal significance. 

Example 3: Subordinates may not take up a collection for a gift to an official superior on the 

occasion of the superior's swearing in or promotion to a higher grade position within the 

supervisory chain of that organization. These are not events that mark the termination of the 

subordinate-official superior relationship, nor are they events of personal significance within 

the meaning of § 2635.304(b). However, subordinates may take up a collection and employees 

may contribute $3 each to buy refreshments to be consumed by everyone in the immediate office 

to mark either such occasion. 

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Example 4: Subordinates may each contribute a nominal amount to a fund to give a gift to an 

official superior upon the occasion of that superior's transfer or promotion to a position outside 

the organization. 

Example 5: An Assistant Secretary at the Department of the Interior is getting married. His 

secretary has decided that a microwave oven would be a nice gift from his staff and has 

informed each of the Assistant Secretary's subordinates that they should contribute $5 for the 

gift. Her method of collection is improper. Although she may recommend a $5 contribution, 

the recommendation must be coupled with a statement that the employee whose contribution 

is solicited is free to contribute less or nothing at all. 

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SUBPART D - CONFLICTING FINANCIAL INTERESTS 

§ 2635.401 Overview. 

This subpart contains two provisions relating to financial interests. One is a disqualification 

requirement and the other is a prohibition on acquiring or continuing to hold specific financial 

interests. An employee may acquire or hold any financial interest not prohibited by § 2635.403. 

Notwithstanding that his acquisition or holding of a particular interest is proper, an employee is 

prohibited in accordance with § 2635.402 of this subpart from participating in an official capacity 

in any particular matter in which, to his knowledge, he or any person whose interests are imputed 

to him has a financial interest, if the particular matter will have a direct and predictable effect on that 

interest. See also part 2640 of this chapter, for additional guidance amplifying § 2635.402. 

§ 2635.402 Disqualifying financial interests. 

(a)	 Statutory prohibition. An employee is prohibited by criminal statute, 18 U.S.C. 208(a), from 

participating personally and substantially in an official capacity in any particular matter in 

which, to his knowledge, he or any person whose interests are imputed to him under this statute 

has a financial interest, if the particular matter will have a direct and predictable effect on that 

interest. 

Note: Standards applicable when seeking non-Federal employment are contained in subpart F 

of this part and, if followed, will ensure that an employee does not violate 18 U.S.C. 208(a) or 

this section when he is negotiating for or has an arrangement concerning future employment. 

In all other cases where the employee's participation would violate 18 U.S.C. 208(a), an 

employee shall disqualify himself from participation in the matter in accordance with paragraph 

(c) of this section or obtain a waiver or determine that an exemption applies, as described in 

paragraph (d) of this section. 

(b) Definitions. For purposes of this section, the following definitions shall apply: 

(1) Direct and predictable effect. 

(i)	 A particular matter will have a direct effect on a financial interest if there is a close 

causal link between any decision or action to be taken in the matter and any 

expected effect of the matter on the financial interest. An effect may be direct even 

though it does not occur immediately. A particular matter will not have a direct 

effect on a financial interest, however, if the chain of causation is attenuated or is 

contingent upon the occurrence of events that are speculative or that are 

independent of, and unrelated to, the matter. A particular matter that has an effect 

on a financial interest only as a consequence of its effects on the general economy 

does not have a direct effect within the meaning of this subpart. 

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(ii)	 A particular matter will have a predictable effect if there is a real, as opposed to a 

speculative possibility that the matter will affect the financial interest. It is not 

necessary, however, that the magnitude of the gain or loss be known, and the dollar 

amount of the gain or loss is immaterial. 

Note: If a particular matter involves a specific party or parties, generally the matter will at 

most only have a direct and predictable effect, for purposes of this subpart, on a financial 

interest of the employee in or with a party, such as the employee's interest by virtue of 

owning stock. There may, however, be some situations in which, under the above standards, 

a particular matter will have a direct and predictable effect on an employee's financial 

interests in or with a nonparty. For example, if a party is a corporation, a particular matter 

may also have a direct and predictable effect on an employee's financial interests through 

ownership of stock in an affiliate, parent, or subsidiary of that party. Similarly, the 

disposition of a protest against the award of a contract to a particular company may also have 

a direct and predictable effect on an employee's financial interest in another company listed 

as a subcontractor in the proposal of one of the competing offerors. 

Example 1: An employee of the National Library of Medicine at the National Institutes of 

Health has just been asked to serve on the technical evaluation panel to review proposals 

for a new library computer search system. DEF Computer Corporation, a closely held 

company in which he and his wife own a majority of the stock, has submitted a proposal. 

Because award of the systems contract to DEF or to any other offeror will have a direct and 

predictable effect on both his and his wife's financial interests, the employee cannot 

participate on the technical evaluation team unless his disqualification has been waived. 

Example 2: Upon assignment to the technical evaluation panel, the employee in the 

preceding example finds that DEF Computer Corporation has not submitted a proposal. 

Rather, LMN Corp., with which DEF competes for private sector business, is one of the six 

offerors. The employee is not disqualified from serving on the technical evaluation panel. 

Any effect on the employee's financial interests as a result of the agency's decision to award 

or not award the systems contract to LMN would be at most indirect and speculative. 

(2)	 Imputed interests. For purposes of 18 U.S.C. 208(a) and this subpart, the financial 

interests of the following persons will serve to disqualify an employee to the same extent 

as if they were the employee's own interests: 

(i) The employee's spouse; 

(ii) The employee's minor child; 

(iii) The employee's general partner; 

(iv)	 An organization or entity which the employee serves as officer, director, trustee, 

general partner or employee; and 

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(v)	 A person with whom the employee is negotiating for or has an arrangement 

concerning prospective employment. (Employees who are seeking other 

employment should refer to and comply with the standards in subpart F of this 

part). 

Example 1: An employee of the Department of Education serves without compensation 

on the board of directors of Kinder World, Inc., a nonprofit corporation that engages in 

good works. Even though her personal financial interests will not be affected, the 

employee must disqualify herself from participating in the review of a grant application 

submitted by Kinder World. Award or denial of the grant will affect the financial 

interests of Kinder World and its financial interests are imputed to her as a member of 

its board of directors. 

Example 2: The spouse of an employee of the Food and Drug Administration has 

obtained a position with a well established biomedical research company. The company 

has developed an artificial limb for which it is seeking FDA approval and the employee 

would ordinarily be asked to participate in the FDA's review and approval process. The 

spouse is a salaried employee of the company and has no direct ownership interest in 

the company. Nor does she have an indirect ownership interest, as would be the case, 

for example, if she were participating in a pension plan that held stock in the company. 

Her position with the company is such that the granting or withholding of FDA approval 

will not have a direct and predictable effect on her salary or on her continued 

employment with the company. Since the FDA approval process will not affect his 

spouse's financial interests, the employee is not disqualified under § 2635.402 from 

participating in that process. Nevertheless, the financial interests of the spouse's 

employer may be disqualifying under the impartiality principle, as implemented at 

§ 2635.502. 

(3)	 Particular matter. The term particular matter encompasses only matters that involve 

deliberation, decision, or action that is focused upon the interests of specific persons, or 

a discrete and identifiable class of persons. Such a matter is covered by this subpart even 

if it does not involve formal parties and may include governmental action such as 

legislation or policy-making that is narrowly focused on the interests of such a discrete 

and identifiable class of persons. The term particular matter, however, does not extend 

to the consideration or adoption of broad policy options that are directed to the interests 

of a large and diverse group of persons. The particular matters covered by this subpart 

include a judicial or other proceeding, application, request for a ruling or other 

determination, contract, claim, controversy, charge, accusation or arrest. 

Example 1: The Internal Revenue Service's amendment of its regulations to change the 

manner in which depreciation is calculated is not a particular matter, nor is the Social 

Security Administration's consideration of changes to its appeal procedures for disability 

claimants. 

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Example 2: Consideration by the Interstate Commerce Commission of regulations 

establishing safety standards for trucks on interstate highways involves a particular 

matter. 

(4)	 Personal and substantial. To participate personally means to participate directly. It 

includes the direct and active supervision of the participation of a subordinate in the 

matter. To participate substantially means that the employee's involvement is of 

significance to the matter. Participation may be substantial even though it is not 

determinative of the outcome of a particular matter. However, it requires more than 

official responsibility, knowledge, perfunctory involvement, or involvement on an 

administrative or peripheral issue. A finding of substantiality should be based not only 

on the effort devoted to a matter, but also on the importance of the effort. While a series 

of peripheral involvements may be insubstantial, the single act of approving or 

participating in a critical step may be substantial. Personal and substantial participation 

may occur when, for example, an employee participates through decision, approval, 

disapproval, recommendation, investigation or the rendering of advice in a particular 

matter. 

(c)	 Disqualification. Unless the employee is authorized to participate in the particular matter by 

virtue of a waiver or exemption described in paragraph (d) of this section or because the interest 

has been divested in accordance with paragraph (e) of this section, an employee shall disqualify 

himself from participating in a particular matter in which, to his knowledge, he or a person 

whose interests are imputed to him has a financial interest, if the particular matter will have a 

direct and predictable effect on that interest. Disqualification is accomplished by not 

participating in the particular matter. 

(1)	 Notification. An employee who becomes aware of the need to disqualify himself from 

participation in a particular matter to which he has been assigned should notify the 

person responsible for his assignment. An employee who is responsible for his own 

assignment should take whatever steps are necessary to ensure that he does not 

participate in the matter from which he is disqualified. Appropriate oral or written 

notification of the employee's disqualification may be made to coworkers by the 

employee or a supervisor to ensure that the employee is not involved in a matter from 

which he is disqualified. 

(2)	 Documentation. An employee need not file a written disqualification statement unless 

he is required by part 2634 of this chapter to file written evidence of compliance with an 

ethics agreement with the Office of Government Ethics or is asked by an agency ethics 

official or the person responsible for his assignment to file a written disqualification 

statement. However, an employee may elect to create a record of his actions by 

providing written notice to a supervisor or other appropriate official. 

Example 1: An Assistant Secretary of the Department of the Interior owns recreational 

property that borders on land which is being considered for annexation to a national 

park. Annexation would directly and predictably increase the value of her vacation 

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property and, thus, she is disqualified from participating in any way in the Department's 

deliberations or decisions regarding the annexation. Because she is responsible for 

determining which matters she will work on, she may accomplish her disqualification 

merely by ensuring that she does not participate in the matter. Because of the level of 

her position, however, the Assistant Secretary might be wise to establish a record that 

she has acted properly by providing a written disqualification statement to an official 

superior and by providing written notification of the disqualification to subordinates to 

ensure that they do not raise or discuss with her any issues related to the annexation. 

(d)	 Waiver of or exemptions from disqualification. An employee who would otherwise be 

disqualified by 18 U.S.C. 208(a) may be permitted to participate in a particular matter where 

the otherwise disqualifying financial interest is the subject of a regulatory exemption or 

individual waiver described in this paragraph, or results from certain Indian birthrights as 

described in 18 U.S.C. 208(b)(4). 

(1)	 Regulatory exemptions. Under 18 U.S.C. 208(b)(2), regulatory exemptions of general 

applicability have been issued by the Office of Government Ethics, based on its 

determination that particular interests are too remote or too inconsequential to affect the 

integrity of the services of employees to whom those exemptions apply. See the 

regulations in subpart B of part 2640 of this chapter, which supersede any preexisting 

agency regulatory exemptions. 

(2)	 Individual waivers. An individual waiver enabling the employee to participate in one 

or more particular matters may be issued under 18 U.S.C. 208(b)(1) if, in advance of the 

employee's participation: 

(i) The employee: 

(A)	 Advises the Government official responsible for the employee's appointment 

(or other Government official to whom authority to issue such a waiver for 

the employee has been delegated) about the nature and circumstances of the 

particular matter or matters; and 

(B)	 Makes full disclosure to such official of the nature and extent of the 

disqualifying financial interest; and 

(ii)	 Such official determines, in writing, that the employee's financial interest in the 

particular matter or matters is not so substantial as to be deemed likely to affect the 

integrity of the services which the Government may expect from such employee. 

See also subpart C of part 2640 of this chapter, for additional guidance. 

(3)	 Federal advisory committee member waivers. An individual waiver may be issued under 

18 U.S.C. 208(b)(3) to a special Government employee serving on, or under 

consideration for appointment to, an advisory committee within the meaning of the 

Federal Advisory Committee Act if the Government official responsible for the 

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employee's appointment (or other Government official to whom authority to issue such 

a waiver for the employee has been delegated): 

(i)	 Reviews the financial disclosure report filed by the special Government employee 

pursuant to the Ethics in Government Act of 1978; and 

(ii)	 Certifies in writing that the need for the individual's services outweighs the 

potential for a conflict of interest created by the otherwise disqualifying financial 

interest. See also subpart C of part 2640 of this chapter, for additional guidance. 

(4)	 Consultation and notification regarding waivers. When practicable, an official is 

required to consult formally or informally with the Office of Government Ethics prior 

to granting a waiver referred to in paragraph (d)(2) or (3) of this section. A copy of each 

such waiver is to be forwarded to the Director of the Office of Government Ethics. 

(e)	 Divestiture of a disqualifying financial interest. Upon sale or other divestiture of the asset or 

other interest that causes his disqualification from participation in a particular matter, 18 U.S.C. 

208(a) and paragraph (c) of this section will no longer prohibit the employee's participation in 

the matter. 

(1)	 Voluntary divestiture. An employee who would otherwise be disqualified from 

participation in a particular matter may voluntarily sell or otherwise divest himself of the 

interest that causes the disqualification. 

(2)	 Directed divestiture. An employee may be required to sell or otherwise divest himself 

of the disqualifying financial interest if his continued holding of that interest is 

prohibited by statute or by agency supplemental regulation issued in accordance with 

§ 2635.403(a), or if the agency determines in accordance with § 2635.403(b) that a 

substantial conflict exists between the financial interest and the employee's duties or 

accomplishment of the agency's mission. 

(3)	 Eligibility for special tax treatment. An employee who is directed to divest an interest 

may be eligible to defer the tax consequences of divestiture under subpart J of part 2634 

of this chapter. An employee who divests before obtaining a certificate of divestiture 

will not be eligible for this special tax treatment. 

(f)	 Official duties that give rise to potential conflicts. Where an employee's official duties create 

a substantial likelihood that the employee may be assigned to a particular matter from which 

he is disqualified, the employee should advise his supervisor or other person responsible for his 

assignments of that potential so that conflicting assignments can be avoided, consistent with 

the agency's needs. 

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§ 2635.403 Prohibited financial interests.

An employee shall not acquire or hold any financial interest that he is prohibited from acquiring or

holding by statute, by agency regulation issued in accordance with paragraph (a) of this section or

by reason of an agency determination of substantial conflict under paragraph (b) of this section. 

Note: There is no statute of Governmentwide applicability prohibiting employees from holding or

acquiring any financial interest. Statutory restrictions, if any, are contained in agency statutes

which, in some cases, may be implemented by agency regulations issued independent of this part.

(a) Agency regulation prohibiting certain financial interests. An agency may, by supplemental

agency regulation issued after February 3, 1993, prohibit or restrict the acquisition or holding

of a financial interest or a class of financial interests by agency employees, or any category of

agency employees, and the spouses and minor children of those employees, based on the

agency's determination that the acquisition or holding of such financial interests would cause

a reasonable person to question the impartiality and objectivity with which agency programs

are administered. Where the agency restricts or prohibits the holding of certain financial

interests by its employees' spouses or minor children, any such prohibition or restriction shall

be based on a determination that there is a direct and appropriate nexus between the prohibition

or restriction as applied to spouses and minor children and the efficiency of the service. 

(b) Agency determination of substantial conflict. An agency may prohibit or restrict an individual

employee from acquiring or holding a financial interest or a class of financial interests based

upon the agency designee's determination that the holding of such interest or interests will: 

(1) Require the employee's disqualification from matters so central or critical to the

performance of his official duties that the employee's ability to perform the duties of his

position would be materially impaired; or 

(2) Adversely affect the efficient accomplishment of the agency's mission because another

employee cannot be readily assigned to perform work from which the employee would

be disqualified by reason of the financial interest. 

Example 1: An Air Force employee who owns stock in a major aircraft engine

manufacturer is being considered for promotion to a position that involves responsibility

for development of a new fighter airplane. If the agency determined that engineering

and other decisions about the Air Force's requirements for the fighter would directly and

predictably affect his financial interests, the employee could not, by virtue of 18 U.S.C.

208(a), perform these significant duties of the position while retaining his stock in the

company. The agency can require the employee to sell his stock as a condition of being

selected for the position rather than allowing him to disqualify himself in particular

matters. 
(c) Definition of financial interest. For purposes of this section: 

(1)	 Except as provided in paragraph (c)(2) of this section, the term financial interest is 

limited to financial interests that are owned by the employee or by the employee's spouse 

or minor children. However, the term is not limited to only those financial interests that 

would be disqualifying under 18 U.S.C. 208(a) and § 2635.402. The term includes any 

current or contingent ownership, equity, or security interest in real or personal property 

or a business and may include an indebtedness or compensated employment relationship. 

It thus includes, for example, interests in the nature of stocks, bonds, partnership 

interests, fee and leasehold interests, mineral and other property rights, deeds of trust, 

and liens, and extends to any right to purchase or acquire any such interest, such as a 

stock option or commodity future. It does not include a future interest created by 

someone other than the employee, his spouse, or dependent child or any right as a 

beneficiary of an estate that has not been settled. 

Example 1: A regulatory agency has concluded that ownership by its employees of stock 

in entities regulated by the agency would significantly diminish public confidence in the 

agency's performance of its regulatory functions and thereby interfere with the 

accomplishment of its mission. In its supplemental agency regulations, the agency may 

prohibit its employees from acquiring or continuing to hold stock in regulated entities. 

Example 2: An agency that insures bank deposits may, by supplemental agency 

regulation, prohibit its employees who are bank examiners from obtaining loans from 

banks they examine. Examination of a member bank could have no effect on an 

employee's fixed obligation to repay a loan from that bank and, thus, would not affect 

an employee's financial interests so as to require disqualification under § 2635.402. 

Nevertheless, a loan from a member bank is a discrete financial interest within the 

meaning of § 2635.403(c) that may, when appropriate, be prohibited by supplemental 

agency regulation. 

(2)	 The term financial interest includes service, with or without compensation, as an officer, 

director, trustee, general partner or employee of any person, including a nonprofit entity, 

whose financial interests are imputed to the employee under § 2635.402(b)(2)(iii) or (iv). 

Example 1: The Foundation for the Preservation of Wild Horses maintains herds of 

horses that graze on public and private lands. Because its costs are affected by Federal 

policies regarding grazing permits, the Foundation routinely comments on all proposed 

rules governing use of Federal grasslands issued by the Bureau of Land Management. 

BLM may require an employee to resign his uncompensated position as Vice President 

of the Foundation as a condition of his promotion to a policy-level position within the 

Bureau rather than allowing him to rely on disqualification in particular cases. 

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(d)	 Reasonable period to divest or terminate. Whenever an agency directs divestiture of a financial 

interest under paragraph (a) or (b) of this section, the employee shall be given a reasonable 

period of time, considering the nature of his particular duties and the nature and marketability 

of the interest, within which to comply with the agency's direction. Except in cases of unusual 

hardship, as determined by the agency, a reasonable period shall not exceed 90 days from the 

date divestiture is first directed. However, as long as the employee continues to hold the 

financial interest, he remains subject to any restrictions imposed by this subpart. 

(e)	 Eligibility for special tax treatment. An employee required to sell or otherwise divest a 

financial interest may be eligible to defer the tax consequences of divestiture under subpart J 

of part 2634 of this chapter. 

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SUBPART E - IMPARTIALITY IN PERFORMING OFFICIAL DUTIES 

§ 2635.501 Overview. 

(a)	 This subpart contains two provisions intended to ensure that an employee takes appropriate 

steps to avoid an appearance of loss of impartiality in the performance of his official duties. 

Under § 2635.502, unless he receives prior authorization, an employee should not participate 

in a particular matter involving specific parties which he knows is likely to affect the financial 

interests of a member of his household, or in which he knows a person with whom he has a 

covered relationship is or represents a party, if he determines that a reasonable person with 

knowledge of the relevant facts would question his impartiality in the matter. An employee 

who is concerned that other circumstances would raise a question regarding his impartiality 

should use the process described in § 2635.502 to determine whether he should or should not 

participate in a particular matter. 

(b)	 Under § 2635.503, an employee who has received an extraordinary severance or other payment 

from a former employer prior to entering Government service is subject, in the absence of a 

waiver, to a two-year period of disqualification from participation in particular matters in which 

that former employer is or represents a party. 

Note: Questions regarding impartiality necessarily arise when an employee's official duties 

impact upon the employee's own financial interests or those of certain other persons, such as 

the employee's spouse or minor child. An employee is prohibited by criminal statute, 18 U.S.C. 

208(a), from participating personally and substantially in an official capacity in any particular 

matter in which, to his knowledge, he, his spouse, general partner or minor child has a financial 

interest, if the particular matter will have a direct and predictable effect on that interest. The 

statutory prohibition also extends to an employee's participation in a particular matter in which, 

to his knowledge, an organization in which the employee is serving as officer, director, trustee, 

general partner or employee, or with whom he is negotiating or has an arrangement concerning 

prospective employment has a financial interest. Where the employee's participation in a 

particular matter would affect any one of these financial interests, the standards set forth in 

subparts D or F of this part apply and only a statutory waiver or exemption, as described in 

§§ 2635.402(d) and 2635.605(a), will enable the employee to participate in that matter. The 

authorization procedures in § 2635.502(d) may not be used to authorize an employee's 

participation in any such matter. Where the employee complies with all terms of the waiver, 

the granting of a statutory waiver will be deemed to constitute a determination that the interest 

of the Government in the employee's participation outweighs the concern that a reasonable 

person may question the integrity of agency programs and operations. Similarly, where the 

employee meets all prerequisites for the application of one of the exemptions set forth in 

subpart B of part 2640 of this chapter, that also constitutes a determination that the interest of 

the Government in the employee’s participation outweighs the concern that a reasonable person 

may question the integrity of agency programs and operations. 

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§ 2635.502 Personal and business relationships. 

(a)	 Consideration of appearances by the employee. Where an employee knows that a particular 

matter involving specific parties is likely to have a direct and predictable effect on the financial 

interest of a member of his household, or knows that a person with whom he has a covered 

relationship is or represents a party to such matter, and where the employee determines that the 

circumstances would cause a reasonable person with knowledge of the relevant facts to question 

his impartiality in the matter, the employee should not participate in the matter unless he has 

informed the agency designee of the appearance problem and received authorization from the 

agency designee in accordance with paragraph (d) of this section. 

(1)	 In considering whether a relationship would cause a reasonable person to question his 

impartiality, an employee may seek the assistance of his supervisor, an agency ethics 

official or the agency designee. 

(2)	 An employee who is concerned that circumstances other than those specifically 

described in this section would raise a question regarding his impartiality should use the 

process described in this section to determine whether he should or should not participate 

in a particular matter. 

(b) Definitions. For purposes of this section: 

(1) An employee has a covered relationship with: 

(i)	 A person, other than a prospective employer described in § 2635.603(c), with 

whom the employee has or seeks a business, contractual or other financial 

relationship that involves other than a routine consumer transaction; 

Note: An employee who is seeking employment within the meaning of § 2635.603 

shall comply with subpart F of this part rather than with this section. 

(ii)	 A person who is a member of the employee's household, or who is a relative with 

whom the employee has a close personal relationship; 

(iii)	 A person for whom the employee's spouse, parent or dependent child is, to the 

employee's knowledge, serving or seeking to serve as an officer, director, trustee, 

general partner, agent, attorney, consultant, contractor or employee; 

(iv)	 Any person for whom the employee has, within the last year, served as officer, 

director, trustee, general partner, agent, attorney, consultant, contractor or 

employee; or 

(v)	 An organization, other than a political party described in 26 U.S.C. 527(e), in 

which the employee is an active participant. Participation is active if, for example, 

it involves service as an official of the organization or in a capacity similar to that 

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of a committee or subcommittee chairperson or spokesperson, or participation in 

directing the activities of the organization. In other cases, significant time devoted 

to promoting specific programs of the organization, including coordination of 

fundraising efforts, is an indication of active participation. Payment of dues or the 

donation or solicitation of financial support does not, in itself, constitute active 

participation. 

Note: Nothing in this section shall be construed to suggest that an employee should not 

participate in a matter because of his political, religious or moral views. 

(2) Direct and predictable effect has the meaning set forth in § 2635.402(b)(1). 

(3)	 Particular matter involving specific parties has the meaning set forth in § 2637.102(a)(7) 

of this chapter. 

Example 1: An employee of the General Services Administration has made an offer to 

purchase a restaurant owned by a local developer. The developer has submitted an 

offer in response to a GSA solicitation for lease of office space. Under the 

circumstances, she would be correct in concluding that a reasonable person would be 

likely to question her impartiality if she were to participate in evaluating that 

developer's or its competitor's lease proposal. 

Example 2: An employee of the Department of Labor is providing technical assistance 

in drafting occupational safety and health legislation that will affect all employers of five 

or more persons. His wife is employed as an administrative assistant by a large 

corporation that will incur additional costs if the proposed legislation is enacted. 

Because the legislation is not a particular matter involving specific parties, the employee 

may continue to work on the legislation and need not be concerned that his wife's 

employment with an affected corporation would raise a question concerning his 

impartiality. 

Example 3: An employee of the Defense Logistics Agency who has responsibilities for 

testing avionics being produced by an Air Force contractor has just learned that his 

sister-in-law has accepted employment as an engineer with the contractor's parent 

corporation. Where the parent corporation is a conglomerate, the employee could 

reasonably conclude that, under the circumstances, a reasonable person would not be 

likely to question his impartiality if he were to continue to perform his test and 

evaluation responsibilities. 

Example 4: An engineer has just resigned from her position as vice president of an 

electronics company in order to accept employment with the Federal Aviation 

Administration in a position involving procurement responsibilities. Although the 

employee did not receive an extraordinary payment in connection with her resignation 

and has severed all financial ties with the firm, under the circumstances she would be 

correct in concluding that her former service as an officer of the company would be 

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likely to cause a reasonable person to question her impartiality if she were to participate 

in the administration of a DOT contract for which the firm is a first-tier subcontractor. 

Example 5: An employee of the Internal Revenue Service is a member of a private 

organization whose purpose is to restore a Victorian-era railroad station and she chairs 

its annual fundraising drive. Under the circumstances, the employee would be correct 

in concluding that her active membership in the organization would be likely to cause 

a reasonable person to question her impartiality if she were to participate in an IRS 

determination regarding the tax-exempt status of the organization. 

(c)	 Determination by agency designee. Where he has information concerning a potential 

appearance problem arising from the financial interest of a member of the employee's 

household in a particular matter involving specific parties, or from the role in such matter of 

a person with whom the employee has a covered relationship, the agency designee may make 

an independent determination as to whether a reasonable person with knowledge of the relevant 

facts would be likely to question the employee's impartiality in the matter. Ordinarily, the 

agency designee's determination will be initiated by information provided by the employee 

pursuant to paragraph (a) of this section. However, at any time, including after the employee 

has disqualified himself from participation in a matter pursuant to paragraph (e) of this section, 

the agency designee may make this determination on his own initiative or when requested by 

the employee's supervisor or any other person responsible for the employee's assignment. 

(1)	 If the agency designee determines that the employee's impartiality is likely to be 

questioned, he shall then determine, in accordance with paragraph (d) of this section, 

whether the employee should be authorized to participate in the matter. Where the 

agency designee determines that the employee's participation should not be authorized, 

the employee will be disqualified from participation in the matter in accordance with 

paragraph (e) of this section. 

(2)	 If the agency designee determines that the employee's impartiality is not likely to be 

questioned, he may advise the employee, including an employee who has reached a 

contrary conclusion under paragraph (a) of this section, that the employee's participation 

in the matter would be proper. 

(d)	 Authorization by agency designee. Where an employee's participation in a particular matter 

involving specific parties would not violate 18 U.S.C. 208(a), but would raise a question in the 

mind of a reasonable person about his impartiality, the agency designee may authorize the 

employee to participate in the matter based on a determination, made in light of all relevant 

circumstances, that the interest of the Government in the employee's participation outweighs 

the concern that a reasonable person may question the integrity of the agency's programs and 

operations. Factors which may be taken into consideration include: 

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(1) The nature of the relationship involved; 

(2)	 The effect that resolution of the matter would have upon the financial interests of the 

person involved in the relationship; 

(3)	 The nature and importance of the employee's role in the matter, including the extent to 

which the employee is called upon to exercise discretion in the matter; 

(4) The sensitivity of the matter; 

(5) The difficulty of reassigning the matter to another employee; and 

(6)	 Adjustments that may be made in the employee's duties that would reduce or eliminate 

the likelihood that a reasonable person would question the employee's impartiality. 

Authorization by the agency designee shall be documented in writing at the agency designee's 

discretion or when requested by the employee. An employee who has been authorized to 

participate in a particular matter involving specific parties may not thereafter disqualify himself 

from participation in the matter on the basis of an appearance problem involving the same 

circumstances that have been considered by the agency designee. 

Example 1: The Deputy Director of Personnel for the Department of the Treasury and an 

attorney with the Department's Office of General Counsel are general partners in a real estate 

partnership. The Deputy Director advises his supervisor, the Director of Personnel, of the 

relationship upon being assigned to a selection panel for a position for which his partner has 

applied. If selected, the partner would receive a substantial increase in salary. The agency 

designee cannot authorize the Deputy Director to participate on the panel under the authority 

of this section since the Deputy Director is prohibited by criminal statute, 18 U.S.C. 208(a), 

from participating in a particular matter affecting the financial interest of a person who is his 

general partner. See § 2635.402. 

Example 2: A new employee of the Securities and Exchange Commission is assigned to an 

investigation of insider trading by the brokerage house where she had recently been employed. 

Because of the sensitivity of the investigation, the agency designee may be unable to conclude 

that the Government's interest in the employee's participation in the investigation outweighs 

the concern that a reasonable person may question the integrity of the investigation, even 

though the employee has severed all financial ties with the company. Based on consideration 

of all relevant circumstances, the agency designee might determine, however, that it is in the 

interest of the Government for the employee to pass on a routine filing by the particular 

brokerage house. 

Example 3: An Internal Revenue Service employee involved in a long and complex tax audit 

is advised by her son that he has just accepted an entry-level management position with a 

corporation whose taxes are the subject of the audit. Because the audit is essentially complete 

and because the employee is the only one with an intimate knowledge of the case, the agency 

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designee might determine, after considering all relevant circumstances, that it is in the 

Government's interest for the employee to complete the audit, which is subject to additional 

levels of review. 

(e)	 Disqualification. Unless the employee is authorized to participate in the matter under 

paragraph (d) of this section, an employee shall not participate in a particular matter involving 

specific parties when he or the agency designee has concluded, in accordance with paragraph 

(a) or (c) of this section, that the financial interest of a member of the employee's household, 

or the role of a person with whom he has a covered relationship, is likely to raise a question in 

the mind of a reasonable person about his impartiality. Disqualification is accomplished by not 

participating in the matter. 

(1)	 Notification. An employee who becomes aware of the need to disqualify himself from 

participation in a particular matter involving specific parties to which he has been 

assigned should notify the person responsible for his assignment. An employee who is 

responsible for his own assignment should take whatever steps are necessary to ensure 

that he does not participate in the matter from which he is disqualified. Appropriate oral 

or written notification of the employee's disqualification may be made to coworkers by 

the employee or a supervisor to ensure that the employee is not involved in a particular 

matter involving specific parties from which he is disqualified. 

(2)	 Documentation. An employee need not file a written disqualification statement unless 

he is required by part 2634 of this chapter to file written evidence of compliance with an 

ethics agreement with the Office of Government Ethics or is specifically asked by an 

agency ethics official or the person responsible for his assignment to file a written 

disqualification statement. However, an employee may elect to create a record of his 

actions by providing written notice to a supervisor or other appropriate official. 

(f)	 Relevant considerations. An employee's reputation for honesty and integrity is not a relevant 

consideration for purposes of any determination required by this section. 

§ 2635.503 Extraordinary payments from former employers. 

(a)	 Disqualification requirement. Except as provided in paragraph (c) of this section, an employee 

shall be disqualified for two years from participating in any particular matter in which a former 

employer is a party or represents a party if he received an extraordinary payment from that 

person prior to entering Government service. The two-year period of disqualification begins 

to run on the date that the extraordinary payment is received. 

Example 1: Following his confirmation hearings and one month before his scheduled swearing 

in, a nominee to the position of Assistant Secretary of a department received an extraordinary 

payment from his employer. For one year and 11 months after his swearing in, the Assistant 

Secretary may not participate in any particular matter to which his former employer is a party. 

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Example 2: An employee received an extraordinary payment from her former employer, a coal 

mine operator, prior to entering on duty with the Department of the Interior. For two years 

thereafter, she may not participate in a determination regarding her former employer's 

obligation to reclaim a particular mining site, because her former employer is a party to the 

matter. However, she may help to draft reclamation legislation affecting all coal mining 

operations because this legislation does not involve any parties. 

(b) Definitions. For purposes of this section, the following definitions shall apply: 

(1)	 Extraordinary payment means any item, including cash or an investment interest, with 

a value in excess of $10,000, which is paid: 

(i)	 On the basis of a determination made after it became known to the former 

employer that the individual was being considered for or had accepted a 

Government position; and 

(ii)	 Other than pursuant to the former employer's established compensation, 

partnership, or benefits program. A compensation, partnership, or benefits 

program will be deemed an established program if it is contained in bylaws, a 

contract or other written form, or if there is a history of similar payments made to 

others not entering into Federal service. 

Example 1: The vice president of a small corporation is nominated to be an 

ambassador. In recognition of his service to the corporation, the board of directors 

votes to pay him $50,000 upon his confirmation in addition to the regular severance 

payment provided for by the corporate bylaws. The regular severance payment is not 

an extraordinary payment. The gratuitous payment of $50,000 is an extraordinary 

payment, since the corporation had not made similar payments to other departing 

officers. 

(2)	 Former employer includes any person which the employee served as an officer, director, 

trustee, general partner, agent, attorney, consultant, contractor or employee. 

(c)	 Waiver of disqualification. The disqualification requirement of this section may be waived 

based on a finding that the amount of the payment was not so substantial as to cause a 

reasonable person to question the employee's ability to act impartially in a matter in which the 

former employer is or represents a party. The waiver shall be in writing and may be given only 

by the head of the agency or, where the recipient of the payment is the head of the agency, by 

the President or his designee. Waiver authority may be delegated by agency heads to any 

person who has been delegated authority to issue individual waivers under 18 U.S.C. 208(b) 

for the employee who is the recipient of the extraordinary payment. 

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SUBPART F - SEEKING OTHER EMPLOYMENT 

§ 2635.601 Overview. 

This subpart contains a disqualification requirement that applies to employees when seeking 

employment with persons whose financial interests would be directly and predictably affected by 

particular matters in which the employees participate personally and substantially. Specifically, it 

addresses the requirement of 18 U.S.C. 208(a) that an employee disqualify himself from 

participation in any particular matter that will have a direct and predictable effect on the financial 

interests of a person "with whom he is negotiating or has any arrangement concerning prospective 

employment." See § 2635.402 and § 2640.103 of this chapter. Beyond this statutory requirement, 

it also addresses the issues of lack of impartiality that require disqualification from particular matters 

affecting the financial interests of a prospective employer when an employee's actions in seeking 

employment fall short of actual employment negotiations. 

§ 2635.602 Applicability and related considerations. 

To ensure that he does not violate 18 U.S.C. 208(a) or the principles of ethical conduct contained 

in § 2635.101(b), an employee who is seeking employment or who has an arrangement concerning 

prospective employment shall comply with the applicable disqualification requirements of 

§§ 2635.604 and 2635.606 if particular matters in which the employee will be participating 

personally and substantially would directly and predictably affect the financial interests of a 

prospective employer or of a person with whom he has an arrangement concerning prospective 

employment. Compliance with this subpart also will ensure that the employee does not violate 

subpart D or E of this part. 

Note: An employee who is seeking employment with a person whose financial interests are 

not affected directly and predictably by particular matters in which he participates personally 

and substantially has no obligation under this subpart. An employee may, however, be subject 

to other statutes which impose requirements on employment contacts or discussions, such as 

41 U.S.C. 423(c), applicable to agency officials involved in certain procurement matters. 

(a) Related employment restrictions--

(1) 	 Outside employment while a Federal employee. An employee who is contemplating 

outside employment to be undertaken concurrently with his Federal employment must 

abide by any limitations applicable to his outside activities under subparts G and H of 

this part. He must also comply with any disqualification requirement that may be 

applicable under subpart D or E of this part as a result of his outside employment 

activities. 

(2)	 Post-employment restrictions. An employee who is contemplating employment to be 

undertaken following the termination of his Federal employment should consult an 

agency ethics official to obtain advice regarding any post-employment restrictions that 

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may be applicable. Regulations implementing the Governmentwide post-employment 

statute, 18 U.S.C. 207, are contained in parts 2637 and 2641 of this chapter. Employees 

are cautioned that they may be subject to additional statutory prohibitions on 

post-employment acceptance of compensation from contractors, such as 41 U.S.C. 

423(d). 

(b)	 Interview trips and entertainment. Where a prospective employer who is a prohibited source 

as defined in § 2635.203(d) offers to reimburse an employee's travel expenses, or provide other 

reasonable amenities incident to employment discussions, the employee may accept such 

amenities in accordance with § 2635.204(e)(3). 

§ 2635.603 Definitions. 

For purposes of this subpart: 

(a)	 Employment means any form of non-Federal employment or business relationship involving 

the provision of personal services by the employee, whether to be undertaken at the same time 

as or subsequent to Federal employment. It includes but is not limited to personal services as 

an officer, director, employee, agent, attorney, consultant, contractor, general partner or trustee. 

Example 1: An employee of the Bureau of Indian Affairs who has announced her intention to 

retire is approached by tribal representatives concerning a possible consulting contract with 

the tribe. The independent contractual relationship the tribe wishes to negotiate is employment 

for purposes of this subpart. 

Example 2: An employee of the Department of Health and Human Services is invited to a 

meeting with officials of a nonprofit corporation to discuss the possibility of his serving as a 

member of the corporation's board of directors. Service, with or without compensation, as a 

member of the board of directors constitutes employment for purposes of this subpart. 

(b)	 An employee is seeking employment once he has begun seeking employment within the 

meaning of paragraph (b)(1) of this section and until he is no longer seeking employment within 

the meaning of paragraph (b)(2) of this section. 

(1) An employee has begun seeking employment if he has directly or indirectly: 

(i)	 Engaged in negotiations for employment with any person. For these purposes, as 

for 18 U.S.C. 208(a), the term negotiations means discussion or communication 

with another person, or such person's agent or intermediary, mutually conducted 

with a view toward reaching an agreement regarding possible employment with 

that person. The term is not limited to discussions of specific terms and conditions 

of employment in a specific position; 

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(ii)	 Made an unsolicited communication to any person, or such person's agent or 

intermediary, regarding possible employment with that person. However, the 

employee has not begun seeking employment if that communication was: 

(A) For the sole purpose of requesting a job application; or 

(B)	 For the purpose of submitting a resume or other employment proposal to a 

person affected by the performance or nonperformance of the employee's 

duties only as part of an industry or other discrete class. The employee will 

be considered to have begun seeking employment upon receipt of any 

response indicating an interest in employment discussions; or 

(iii)	 Made a response other than rejection to an unsolicited communication from any 

person, or such person's agent or intermediary, regarding possible employment 

with that person. 

(2) An employee is no longer seeking employment when: 

(i)	 The employee or the prospective employer rejects the possibility of employment 

and all discussions of possible employment have terminated; or 

(ii)	 Two months have transpired after the employee's dispatch of an unsolicited resume 

or employment proposal, provided the employee has received no indication of 

interest in employment discussions from the prospective employer. 

(3)	 For purposes of this definition, a response that defers discussions until the foreseeable 

future does not constitute rejection of an unsolicited employment overture, proposal, or 

resume nor rejection of a prospective employment possibility. 

Example 1: An employee of the Health Care Financing Administration is complimented 

on her work by an official of a State Health Department who asks her to call if she is 

ever interested in leaving Federal service. The employee explains to the State official 

that she is very happy with her job at HCFA and is not interested in another job. She 

thanks him for his compliment regarding her work and adds that she'll remember his 

interest if she ever decides to leave the Government. The employee has rejected the 

unsolicited employment overture and has not begun seeking employment. 

Example 2: The employee in the preceding example responds by stating that she cannot 

discuss future employment while she is working on a project affecting the State's health 

care funding but would like to discuss employment with the State when the project is 

completed. Because the employee has merely deferred employment discussions until the 

foreseeable future, she has begun seeking employment with the State Health Department. 

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Example 3: An employee of the Defense Contract Audit Agency is auditing the overhead 

accounts of an Army contractor. While at the contractor's headquarters, the head of the 

contractor's accounting division tells the employee that his division is thinking about 

hiring another accountant and asks whether the employee might be interested in leaving 

DCAA. The DCAA employee says he is interested in knowing what kind of work would 

be involved. They discuss the duties of the position the accounting division would like 

to fill and the DCAA employee's qualifications for the position. They do not discuss 

salary. The head of the division explains that he has not yet received authorization to 

fill the particular position and will get back to the employee when he obtains the 

necessary approval for additional staffing. The employee and the contractor's official 

have engaged in negotiations regarding possible employment. The employee has begun 

seeking employment with the Army contractor. 

Example 4: An employee of the Occupational Safety and Health Administration helping 

to draft safety standards applicable to the textile industry has mailed his resume to 25 

textile manufacturers. He has not begun seeking employment with any of the twenty-five. 

If he receives a response from one of the resume recipients indicating an interest in 

employment discussions, the employee will have begun seeking employment with the 

respondent at that time. 

Example 5: A special Government employee of the Federal Deposit Insurance 

Corporation is serving on an advisory committee formed for the purpose of reviewing 

rules applicable to all member banks. She mails an unsolicited letter to a member bank 

offering her services as a contract consultant. She has not begun seeking employment 

with the bank until she receives some response indicating an interest in discussing her 

employment proposal. A letter merely acknowledging receipt of the proposal is not an 

indication of interest in employment discussions. 

Example 6: A geologist employed by the U.S. Geological Survey has been working as 

a member of a team preparing the Government's case in an action brought by the 

Government against six oil companies. The geologist sends her resume to an oil 

company that is a named defendant in the action. The geologist has begun seeking 

employment with that oil company and will be seeking employment for two months from 

the date the resume was mailed. However, if she withdraws her application or is notified 

within the two-month period that her resume has been rejected, she will no longer be 

seeking employment with the oil company as of the date she makes such withdrawal or 

receives such notification. 

(c)	 Prospective employer means any person with whom the employee is seeking employment. 

Where contacts that constitute seeking employment are made by or with an agent or other 

intermediary, the term prospective employer includes: 

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(1)	 A person who uses that agent or other intermediary for the purpose of seeking to 

establish an employment relationship with the employee if the agent identifies the 

prospective employer to the employee; and 

(2)	 A person contacted by the employee's agent or other intermediary for the purpose of 

seeking to establish an employment relationship if the agent identifies the prospective 

employer to the employee. 

Example 1: An employee of the Federal Aviation Administration has overall 

responsibility for airport safety inspections in a three-state area. She has retained an 

employment search firm to help her find another job. The search firm has just reported 

to the FAA employee that it has given her resume to and had promising discussions with 

two airport authorities within her jurisdiction. Even though the employee has not 

personally had employment discussions with either, each airport authority is her 

prospective employer. She began seeking employment with each upon learning its 

identity and that it has been given her resume. 

(d)	 Direct and predictable effect, particular matter, and personal and substantial have the 

respective meanings set forth in § 2635.402(b)(1), (3) and (4). 

§ 2635.604 Disqualification while seeking employment. 

(a)	 Obligation to disqualify. Unless the employee's participation is authorized in accordance with 

§ 2635.605, the employee shall not participate personally and substantially in a particular 

matter that, to his knowledge, has a direct and predictable effect on the financial interests of a 

prospective employer with whom he is seeking employment within the meaning of 

§ 2635.603(b). Disqualification is accomplished by not participating in the particular matter. 

(b)	 Notification. An employee who becomes aware of the need to disqualify himself from 

participation in a particular matter to which he has been assigned should notify the person 

responsible for his assignment. An employee who is responsible for his own assignment should 

take whatever steps are necessary to ensure that he does not participate personally and 

substantially in the matter from which he is disqualified. Appropriate oral or written 

notification of the employee's disqualification may be made to coworkers by the employee or 

a supervisor to ensure that the employee is not involved in a matter from which he is 

disqualified. 

(c)	 Documentation. An employee need not file a written disqualification statement unless he is 

required by part 2634 of this chapter to file written evidence of compliance with an ethics 

agreement with the Office of Government Ethics or is specifically asked by an agency ethics 

official or the person responsible for his assignment to file a written disqualification statement. 

However, an employee may elect to create a record of his actions by providing written notice 

to a supervisor or other appropriate official. 

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Example 1: An employee of the Department of Veterans Affairs is participating in the audit of 

a contract for laboratory support services. Before sending his resume to a lab which is a 

subcontractor under the VA contract, the employee should disqualify himself from participation 

in the audit. Since he cannot withdraw from participation in the contract audit without the 

approval of his supervisor, he should disclose his intentions to his supervisor in order that 

appropriate adjustments in his work assignments can be made. 

Example 2: An employee of the Food and Drug Administration is contacted in writing by a 

pharmaceutical company concerning possible employment with the company. The employee 

is involved in testing a drug for which the company is seeking FDA approval. Before making 

a response that is not a rejection, the employee should disqualify himself from further 

participation in the testing. Where he has authority to ask his colleague to assume his testing 

responsibilities, he may accomplish his disqualification by transferring the work to that 

coworker. However, to ensure that his colleague and others with whom he had been working 

on the recommendations do not seek his advice regarding testing or otherwise involve him in 

the matter, it may be necessary for him to advise those individuals of his disqualification. 

Example 3: The General Counsel of a regulatory agency wishes to engage in discussions 

regarding possible employment as corporate counsel of a regulated entity. Matters directly 

affecting the financial interests of the regulated entity are pending within the Office of General 

Counsel, but the General Counsel will not be called upon to act in any such matter because 

signature authority for that particular class of matters has been delegated to an Assistant 

General Counsel. Because the General Counsel is responsible for assigning work within the 

Office of General Counsel, he can in fact accomplish his disqualification by simply avoiding 

any involvement in matters affecting the regulated entity. However, because it is likely to be 

assumed by others that the General Counsel is involved in all matters within the cognizance 

of the Office of General Counsel, he would be wise to file a written disqualification statement 

with the Commissioners of the regulatory agency and provide his subordinates with written 

notification of his disqualification, or he may be specifically asked by an agency ethics official 

or the Commissioners to file a written disqualification statement. 

Example 4: A scientist is employed by the National Science Foundation as a special 

Government employee to serve on a panel that reviews grant applications to fund research 

relating to deterioration of the ozone layer. She is discussing possible employment as a 

member of the faculty of a university that several years earlier received an NSF grant to study 

the effect of fluorocarbons, but has no grant application pending. As long as the university 

does not submit a new application for the panel's review, the employee would not have to take 

any action to effect disqualification. 

(d)	 Agency determination of substantial conflict. Where the agency determines that the employee's 

action in seeking employment with a particular person will require his disqualification from 

matters so central or critical to the performance of his official duties that the employee's ability 

to perform the duties of his position would be materially impaired, the agency may allow the 

employee to take annual leave or leave without pay while seeking employment, or may take 

other appropriate administrative action. 

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§ 2635.605 Waiver or authorization permitting participation while seeking employment.

(a) Waiver. Where, as defined in § 2635.603(b)(1)(i), an employee is engaged in discussions that

constitute employment negotiations for purposes of 18 U.S.C. 208(a), the employee may

participate personally and substantially in a particular matter that has a direct and predictable

effect on the financial interests of a prospective employer only after receiving a written waiver

issued under the authority of 18 U.S.C. 208(b)(1) or (b)(3). These waivers are described in

§ 2635.402(d). See also subpart C of part 2640 of this chapter. For certain employees, a

regulatory exemption under the authority of 18 U.S.C. 208(b)(2) may also apply (see subpart

B of part 2640 of this chapter).

Example 1: An employee of the Department of Agriculture has had two telephone

conversations with an orange grower regarding possible employment. They have discussed the

employee's qualifications for a particular position with the grower, but have not yet discussed

salary or other specific terms of employment. The employee is negotiating for employment

within the meaning of 18 U.S.C. 208(a) and § 2635.603(b)(1)(i). In the absence of a written

waiver issued under 18 U.S.C. 208(b)(1), she may not take official action on a complaint filed

by a competitor alleging that the grower has shipped oranges in violation of applicable quotas.

(b) Authorization by agency designee. Where an employee is seeking employment within the

meaning of § 2635.603(b)(1)(ii) or (iii), a reasonable person would be likely to question his

impartiality if he were to participate personally and substantially in a particular matter that has

a direct and predictable effect on the financial interests of any such prospective employer. The

employee may participate in such matters only where the agency designee has authorized his

participation in accordance with the standards set forth in § 2635.502(d). 

Example 1: Within the past month, an employee of the Education Department mailed her

resume to a university. She is thus seeking employment with the university within the meaning

of § 2635.603(b)(1)(ii) even though she has received no reply. In the absence of specific

authorization by the agency designee in accordance with § 2635.502(d), she may not

participate in an assignment to review a grant application submitted by the university. 

§ 2635.606 Disqualification based on an arrangement concerning prospective employment or

otherwise after negotiations.

(a) Employment or arrangement concerning employment. An employee shall be disqualified from

participating personally and substantially in a particular matter that has a direct and predictable

effect on the financial interests of the person by whom he is employed or with whom he has an

arrangement concerning future employment, unless authorized to participate in the matter by

a written waiver issued under the authority of 18 U.S.C. 208 (b)(1) or (b)(3), or by a regulatory

exemption under the authority of 18 U.S.C. 208(b)(2). These waivers and exemptions are

described in § 2635.402(d). See also subparts B and C of part 2640 of this chapter.
Example 1: A military officer has accepted a job with a defense contractor to begin in six 

months, after his retirement from military service. During the period that he remains with the 

Government, the officer may not participate in the administration of a contract with that 

particular defense contractor unless he has received a written waiver under the authority of 

18 U.S.C. 208(b)(1). 

Example 2: An accountant has just been offered a job with the Comptroller of the Currency 

which involves a two-year limited appointment. Her private employer, a large corporation, 

believes the job will enhance her skills and has agreed to give her a two-year unpaid leave of 

absence at the end of which she has agreed to return to work for the corporation. During the 

two-year period she is to be a COC employee, the accountant will have an arrangement 

concerning future employment with the corporation that will require her disqualification from 

participation in any particular matter that will have a direct and predictable effect on the 

corporation's financial interests. 

(b)	 Offer rejected or not made. The agency designee for the purpose of § 2635.502(c) may, in an 

appropriate case, determine that an employee not covered by the preceding paragraph who has 

sought but is no longer seeking employment nevertheless shall be subject to a period of 

disqualification upon the conclusion of employment negotiations. Any such determination shall 

be based on a consideration of all the relevant factors, including those listed in § 2635.502(d), 

and a determination that the concern that a reasonable person may question the integrity of the 

agency's decision making process outweighs the Government's interest in the employee's 

participation in the particular matter. 

Example 1: An employee of the Securities and Exchange Commission was relieved of 

responsibility for an investigation of a broker-dealer while seeking employment with the law 

firm representing the broker-dealer in that matter. The firm did not offer her the partnership 

position she sought. Even though she is no longer seeking employment with the firm, she may 

continue to be disqualified from participating in the investigation based on a determination by 

the agency designee that the concern that a reasonable person might question whether, in view 

of the history of the employment negotiations, she could act impartially in the matter outweighs 

the Government's interest in her participation. 

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SUBPART G - MISUSE OF POSITION 

§ 2635.701 Overview. 

This subpart contains provisions relating to the proper use of official time and authority, and of 

information and resources to which an employee has access because of his Federal employment. 

This subpart sets forth standards relating to: 

(a) Use of public office for private gain; 

(b) Use of nonpublic information; 

(c) Use of Government property; and 

(d) Use of official time. 

§ 2635.702 Use of public office for private gain. 

An employee shall not use his public office for his own private gain, for the endorsement of any 

product, service or enterprise, or for the private gain of friends, relatives, or persons with whom the 

employee is affiliated in a nongovernmental capacity, including nonprofit organizations of which 

the employee is an officer or member, and persons with whom the employee has or seeks 

employment or business relations. The specific prohibitions set forth in paragraphs (a) through (d) 

of this section apply this general standard, but are not intended to be exclusive or to limit the 

application of this section. 

(a)	 Inducement or coercion of benefits. An employee shall not use or permit the use of his 

Government position or title or any authority associated with his public office in a manner that 

is intended to coerce or induce another person, including a subordinate, to provide any benefit, 

financial or otherwise, to himself or to friends, relatives, or persons with whom the employee 

is affiliated in a nongovernmental capacity. 

Example 1: Offering to pursue a relative's consumer complaint over a household appliance, 

an employee of the Securities and Exchange Commission called the general counsel of the 

manufacturer and, in the course of discussing the problem, stated that he worked at the SEC 

and was responsible for reviewing the company's filings. The employee violated the prohibition 

against use of public office for private gain by invoking his official authority in an attempt to 

influence action to benefit his relative. 

Example 2: An employee of the Department of Commerce was asked by a friend to determine 

why his firm's export license had not yet been granted by another office within the Department 

of Commerce. At a department-level staff meeting, the employee raised as a matter for official 

inquiry the delay in approval of the particular license and asked that the particular license be 

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expedited. The official used her public office in an attempt to benefit her friend and, in acting 

as her friend's agent for the purpose of pursuing the export license with the Department of 

Commerce, may also have violated 18 U.S.C. 205. 

(b)	 Appearance of governmental sanction. Except as otherwise provided in this part, an employee 

shall not use or permit the use of his Government position or title or any authority associated 

with his public office in a manner that could reasonably be construed to imply that his agency 

or the Government sanctions or endorses his personal activities or those of another. When 

teaching, speaking, or writing in a personal capacity, he may refer to his official title or position 

only as permitted by § 2635.807(b). He may sign a letter of recommendation using his official 

title only in response to a request for an employment recommendation or character reference 

based upon personal knowledge of the ability or character of an individual with whom he has 

dealt in the course of Federal employment or whom he is recommending for Federal 

employment. 

Example 1: An employee of the Department of the Treasury who is asked to provide a letter 

of recommendation for a former subordinate on his staff may provide the recommendation 

using official stationery and may sign the letter using his official title. If, however, the request 

is for the recommendation of a personal friend with whom he has not dealt in the Government, 

the employee should not use official stationery or sign the letter of recommendation using his 

official title, unless the recommendation is for Federal employment. In writing the letter of 

recommendation for his personal friend, it may be appropriate for the employee to refer to his 

official position in the body of the letter. 

(c)	 Endorsements. An employee shall not use or permit the use of his Government position or title 

or any authority associated with his public office to endorse any product, service or enterprise 

except: 

(1) In furtherance of statutory authority to promote products, services or enterprises; or 

(2)	 As a result of documentation of compliance with agency requirements or standards or 

as the result of recognition for achievement given under an agency program of 

recognition for accomplishment in support of the agency's mission. 

Example 1: A Commissioner of the Consumer Product Safety Commission may not appear in 

a television commercial in which she endorses an electrical appliance produced by her former 

employer, stating that it has been found by the CPSC to be safe for residential use. 

Example 2: A Foreign Commercial Service officer from the Department of Commerce is asked 

by a United States telecommunications company to meet with representatives of the 

Government of Spain, which is in the process of procuring telecommunications services and 

equipment. The company is bidding against five European companies and the statutory mission 

of the Department of Commerce includes assisting the export activities of U.S. companies. As 

part of his official duties, the Foreign Commercial Service officer may meet with Spanish 

officials and explain the advantages of procurement from the United States company. 

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Example 3: The Administrator of the Environmental Protection Agency may sign a letter to an 

oil company indicating that its refining operations are in compliance with Federal air quality 

standards even though he knows that the company has routinely displayed letters of this type 

in television commercials portraying it as a "trustee of the environment for future generations.” 

Example 4: An Assistant Attorney General may not use his official title or refer to his 

Government position in a book jacket endorsement of a novel about organized crime written 

by an author whose work he admires. Nor may he do so in a book review published in a 

newspaper. 

(d)	 Performance of official duties affecting a private interest. To ensure that the performance of 

his official duties does not give rise to an appearance of use of public office for private gain or 

of giving preferential treatment, an employee whose duties would affect the financial interests 

of a friend, relative or person with whom he is affiliated in a nongovernmental capacity shall 

comply with any applicable requirements of § 2635.502. 

(e)	 Use of terms of address and ranks. Nothing in this section prohibits an employee who is 

ordinarily addressed using a general term of address, such as "The Honorable," or a rank, such 

as a military or ambassadorial rank, from using that term of address or rank in connection with 

a personal activity. 

§ 2635.703 Use of nonpublic information. 

(a)	 Prohibition. An employee shall not engage in a financial transaction using nonpublic 

information, nor allow the improper use of nonpublic information to further his own private 

interest or that of another, whether through advice or recommendation, or by knowing 

unauthorized disclosure. 

(b)	 Definition of nonpublic information. For purposes of this section, nonpublic information is 

information that the employee gains by reason of Federal employment and that he knows or 

reasonably should know has not been made available to the general public. It includes 

information that he knows or reasonably should know: 

(1)	 Is routinely exempt from disclosure under 5 U.S.C. 552 or otherwise protected from 

disclosure by statute, Executive order or regulation; 

(2) Is designated as confidential by an agency; or 

(3)	 Has not actually been disseminated to the general public and is not authorized to be made 

available to the public on request. 

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Example 1: A Navy employee learns in the course of her duties that a small corporation will 

be awarded a Navy contract for electrical test equipment. She may not take any action to 

purchase stock in the corporation or its suppliers and she may not advise friends or relatives 

to do so until after public announcement of the award. Such actions could violate Federal 

securities statutes as well as this section. 

Example 2: A General Services Administration employee involved in evaluating proposals for 

a construction contract cannot disclose the terms of a competing proposal to a friend employed 

by a company bidding on the work. Prior to award of the contract, bid or proposal information 

is nonpublic information specifically protected by 41 U.S.C. 423. 

Example 3: An employee is a member of a source selection team assigned to review the 

proposals submitted by several companies in response to an Army solicitation for spare parts. 

As a member of the evaluation team, the employee has access to proprietary information 

regarding the production methods of Alpha Corporation, one of the competitors. He may not 

use that information to assist Beta Company in drafting a proposal to compete for a Navy spare 

parts contract. The Federal Acquisition Regulation in 48 CFR parts 3, 14 and 15 restricts the 

release of information related to procurements and other contractor information that must be 

protected under 18 U.S.C. 1905 and 41 U.S.C. 423. 

Example 4: An employee of the Nuclear Regulatory Commission inadvertently includes a 

document that is exempt from disclosure with a group of documents released in response to a 

Freedom of Information Act request. Regardless of whether the document is used improperly, 

the employee's disclosure does not violate this section because it was not a knowing 

unauthorized disclosure made for the purpose of furthering a private interest. 

Example 5: An employee of the Army Corps of Engineers is actively involved in the activities 

of an organization whose goals relate to protection of the environment. The employee may not, 

other than as permitted by agency procedures, give the organization or a newspaper reporter 

nonpublic information about long-range plans to build a particular dam. 

§ 2635.704 Use of Government property. 

(a)	 Standard. An employee has a duty to protect and conserve Government property and shall not 

use such property, or allow its use, for other than authorized purposes. 

(b) Definitions. For purposes of this section: 

(1)	 Government property includes any form of real or personal property in which the 

Government has an ownership, leasehold, or other property interest as well as any right 

or other intangible interest that is purchased with Government funds, including the 

services of contractor personnel. The term includes office supplies, telephone and other 

telecommunications equipment and services, the Government mails, automated data 

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processing capabilities, printing and reproduction facilities, Government records, and 

Government vehicles. 

(2)	 Authorized purposes are those purposes for which Government property is made 

available to members of the public or those purposes authorized in accordance with law 

or regulation. 

Example 1: Under regulations of the General Services Administration at 41 CFR 101-35.201, 

an employee may make a personal long distance call charged to her personal calling card. 

Example 2: An employee of the Commodity Futures Trading Commission whose office 

computer gives him access to a commercial service providing information for investors may 

not use that service for personal investment research. 

Example 3: In accordance with Office of Personnel Management regulations at part 251 of this 

title, an attorney employed by the Department of Justice may be permitted to use her office 

word processor and agency photocopy equipment to prepare a paper to be presented at a 

conference sponsored by a professional association of which she is a member. 

§ 2635.705 Use of official time. 

(a)	 Use of an employee's own time. Unless authorized in accordance with law or regulations to use 

such time for other purposes, an employee shall use official time in an honest effort to perform 

official duties. An employee not under a leave system, including a Presidential appointee 

exempted under 5 U.S.C. 6301(2), has an obligation to expend an honest effort and a reasonable 

proportion of his time in the performance of official duties. 

Example 1: An employee of the Social Security Administration may use official time to engage 

in certain representational activities on behalf of the employee union of which she is a member. 

Under 5 U.S.C. 7131, this is a proper use of her official time even though it does not involve 

performance of her assigned duties as a disability claims examiner. 

Example 2: A pharmacist employed by the Department of Veterans Affairs has been granted 

excused absence to participate as a speaker in a conference on drug abuse sponsored by the 

professional association to which he belongs. Although excused absence granted by an agency 

in accordance with guidance in chapter 630 of the Federal Personnel Manual allows an 

employee to be absent from his official duties without charge to his annual leave account, such 

absence is not on official time. 

(b)	 Use of a subordinate's time. An employee shall not encourage, direct, coerce, or request a 

subordinate to use official time to perform activities other than those required in the 

performance of official duties or authorized in accordance with law or regulation. 

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Example 1: An employee of the Department of Housing and Urban Development may not ask 

his secretary to type his personal correspondence during duty hours. Further, directing or 

coercing a subordinate to perform such activities during nonduty hours constitutes an improper 

use of public office for private gain in violation of § 2635.702(a). Where the arrangement is 

entirely voluntary and appropriate compensation is paid, the secretary may type the 

correspondence at home on her own time. Where the compensation is not adequate, however, 

the arrangement would involve a gift to the superior in violation of the standards in subpart C 

of this part. 

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SUBPART H - OUTSIDE ACTIVITIES 

§ 2635.801 Overview. 

(a)	 This subpart contains provisions relating to outside employment, outside activities and personal 

financial obligations of employees that are in addition to the principles and standards set forth 

in other subparts of this part. Several of these provisions apply to uncompensated as well as 

to compensated outside activities. 

(b)	 An employee who wishes to engage in outside employment or other outside activities must 

comply with all relevant provisions of this subpart, including, when applicable: 

(1)	 The prohibition on outside employment or any other outside activity that conflicts with 

the employee's official duties; 

(2) Any agency-specific requirement for prior approval of outside employment or activities; 

(3)	 The limitations on receipt of outside earned income by certain Presidential appointees 

and other noncareer employees; 

(4) The limitations on paid and unpaid service as an expert witness; 

(5) The limitations on participation in professional organizations; 

(6) The limitations on paid and unpaid teaching, speaking, and writing; and 

(7) The limitations on fundraising activities. 

(c)	 Outside employment and other outside activities of an employee must also comply with 

applicable provisions set forth in other subparts of this part and in supplemental agency 

regulations. These include the principle that an employee shall endeavor to avoid actions 

creating an appearance of violating any of the ethical standards in this part and the prohibition 

against use of official position for an employee's private gain or for the private gain of any 

person with whom he has employment or business relations or is otherwise affiliated in a 

nongovernmental capacity. 

(d)	 In addition to the provisions of this and other subparts of this part, an employee who wishes to 

engage in outside employment or other outside activities must comply with applicable statutes 

and regulations. Relevant provisions of law, many of which are listed in subpart I of this part, 

may include: 

(1)	 18 U.S.C. 201(b), which prohibits a public official from seeking, accepting or agreeing 

to receive or accept anything of value in return for being influenced in the performance 

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of an official act or for being induced to take or omit to take any action in violation of 

his official duty; 

(2)	 18 U.S.C. 201(c), which prohibits a public official, otherwise than as provided by law 

for the proper discharge of official duty, from seeking, accepting, or agreeing to receive 

or accept anything of value for or because of any official act; 

(3)	 18 U.S.C. 203(a), which prohibits an employee from seeking, accepting, or agreeing to 

receive or accept compensation for any representational services, rendered personally 

or by another, in relation to any particular matter in which the United States is a party 

or has a direct and substantial interest, before any department, agency, or other specified 

entity. This statute contains several exceptions, as well as standards for special 

Government employees that limit the scope of the restriction; 

(4)	 18 U.S.C. 205, which prohibits an employee, whether or not for compensation, from 

acting as agent or attorney for anyone in a claim against the United States or from acting 

as agent or attorney for anyone, before any department, agency, or other specified entity, 

in any particular matter in which the United States is a party or has a direct and 

substantial interest. It also prohibits receipt of any gratuity, or any share of or interest 

in a claim against the United States, in consideration for assisting in the prosecution of 

such claim. This statute contains several exceptions, as well as standards for special 

Government employees that limit the scope of the restrictions; 

(5)	 18 U.S.C. 209, which prohibits an employee, other than a special Government employee, 

from receiving any salary or any contribution to or supplementation of salary from any 

source other than the United States as compensation for services as a Government 

employee. The statute contains several exceptions that limit its applicability; 

(6)	 The Emoluments Clause of the United States Constitution, article I, section 9, clause 8, 

which prohibits anyone holding an office of profit or trust under the United States from 

accepting any gift, office, title or emolument, including salary or compensation, from any 

foreign government except as authorized by Congress. In addition, 18 U.S.C. 219 

generally prohibits any public official from being or acting as an agent of a foreign 

principal, including a foreign government, corporation or person, if the employee would 

be required to register as a foreign agent under 22 U.S.C. 611 et seq.; 

(7)	 The Hatch Act Reform Amendments, 5 U.S.C. 7321 through 7326, which govern the 

political activities of executive branch employees; and 

(8)	 The limitations on outside employment, 5 U.S.C. App. (Ethics in Government Act of 

1978), which prohibit a covered noncareer employee's receipt of compensation for 

specified activities and provide that he shall not allow his name to be used by any firm 

or other entity which provides professional services involving a fiduciary relationship. 

Implementing regulations are contained in §§ 2636.305 through 2636.307 of this chapter. 

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§ 2635.802 Conflicting outside employment and activities. 

An employee shall not engage in outside employment or any other outside activity that conflicts with 

his official duties. An activity conflicts with an employee's official duties: 

(a) If it is prohibited by statute or by an agency supplemental regulation; or 

(b)	 If, under the standards set forth in §§ 2635.402 and 2635.502, it would require the employee's 

disqualification from matters so central or critical to the performance of his official duties that 

the employee's ability to perform the duties of his position would be materially impaired. 

Employees are cautioned that even though an outside activity may not be prohibited under this 

section, it may violate other principles or standards set forth in this part or require the employee 

to disqualify himself from participation in certain particular matters under either subpart D or 

subpart E of this part. 

Example 1: An employee of the Environmental Protection Agency has just been promoted. His 

principal duty in his new position is to write regulations relating to the disposal of hazardous 

waste. The employee may not continue to serve as president of a nonprofit environmental 

organization that routinely submits comments on such regulations. His service as an officer 

would require his disqualification from duties critical to the performance of his official duties 

on a basis so frequent as to materially impair his ability to perform the duties of his position. 

Example 2: An employee of the Occupational Safety and Health Administration who was and 

is expected again to be instrumental in formulating new OSHA safety standards applicable to 

manufacturers that use chemical solvents has been offered a consulting contract to provide 

advice to an affected company in restructuring its manufacturing operations to comply with the 

OSHA standards. The employee should not enter into the consulting arrangement even though 

he is not currently working on OSHA standards affecting this industry and his consulting 

contract can be expected to be completed before he again works on such standards. Even 

though the consulting arrangement would not be a conflicting activity within the meaning of 

§ 2635.802, it would create an appearance that the employee had used his official position to 

obtain the compensated outside business opportunity and it would create the further 

appearance of using his public office for the private gain of the manufacturer. 

§ 2635.803 Prior approval for outside employment and activities. 

When required by agency supplemental regulation issued after February 3, 1993, an employee shall 

obtain prior approval before engaging in outside employment or activities. Where it is determined 

to be necessary or desirable for the purpose of administering its ethics program, an agency shall, by 

supplemental regulation, require employees or any category of employees to obtain prior approval 

before engaging in specific types of outside activities, including outside employment. 

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§ 2635.804 Outside earned income limitations applicable to certain Presidential appointees and 

other noncareer employees. 

(a)	 Presidential appointees to full-time noncareer positions. A Presidential appointee to a full-time 

noncareer position shall not receive any outside earned income for outside employment, or for 

any other outside activity, performed during that Presidential appointment. This limitation does 

not apply to any outside earned income received for outside employment, or for any other 

outside activity, carried out in satisfaction of the employee's obligation under a contract entered 

into prior to April 12, 1989. 

(b)	 Covered noncareer employees. Covered noncareer employees, as defined in § 2636.303(a) of 

this chapter, may not, in any calendar year, receive outside earned income attributable to that 

calendar year which exceeds 15 percent of the annual rate of basic pay for level II of the 

Executive Schedule under 5 U.S.C. 5313, as in effect on January 1 of such calendar year. 

Employees should consult the regulations implementing this limitation, which are contained 

in §§ 2636.301 through 2636.304 of this chapter. 

Note: In addition to the 15 percent limitation on outside earned income, covered noncareer 

employees are prohibited from receiving any compensation for: practicing a profession which 

involves a fiduciary relationship; affiliating with or being employed by a firm or other entity 

which provides professional services involving a fiduciary relationship; serving as an officer 

or member of the board of any association, corporation or other entity; or teaching without prior 

approval. Implementing regulations are contained in §§ 2636.305 through 2636.307 of this 

chapter. 

(c) Definitions. For purposes of this section: 

(1)	 Outside earned income has the meaning set forth in § 2636.303(b) of this chapter, except 

that § 2636.303(b)(8) shall not apply. 

(2)	 Presidential appointee to a full-time noncareer position means any employee who is 

appointed by the President to a full-time position described in 5 U.S.C. 5312 through 

5317 or to a position that, by statute or as a matter of practice, is filled by Presidential 

appointment, other than: 

(i)	 A position filled under the authority of 3 U.S.C. 105 or 3 U.S.C. 107(a) for which 

the rate of basic pay is less than that for GS-9, step 1 of the General Schedule; 

(ii)	 A position, within a White House operating unit, that is designated as not normally 

subject to change as a result of a Presidential transition; 

(iii) A position within the uniformed services; or 

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(iv)	 A position in which a member of the foreign service is serving that does not require 

advice and consent of the Senate. 

Example 1: A career Department of Justice employee who is detailed to a 

policy-making position in the White House Office that is ordinarily filled by a 

noncareer employee is not a Presidential appointee to a full-time noncareer position. 

Example 2: A Department of Energy employee appointed under § 213.3301 of this 

title to a Schedule C position is appointed by the agency and, thus, is not a 

Presidential appointee to a full-time noncareer position. 

§ 2635.805 Service as an expert witness. 

(a)	 Restriction. An employee shall not serve, other than on behalf of the United States, as an expert 

witness, with or without compensation, in any proceeding before a court or agency of the 

United States in which the United States is a party or has a direct and substantial interest, unless 

the employee's participation is authorized by the agency under paragraph (c) of this section. 

Except as provided in paragraph (b) of this section, this restriction shall apply to a special 

Government employee only if he has participated as an employee or special Government 

employee in the particular proceeding or in the particular matter that is the subject of the 

proceeding. 

(b) Additional restriction applicable to certain special Government employees. 

(1) 	 In addition to the restriction described in paragraph (a) of this section, a special 

Government employee described in paragraph (b)(2) of this section shall not serve, other 

than on behalf of the United States, as an expert witness, with or without compensation, 

in any proceeding before a court or agency of the United States in which his employing 

agency is a party or has a direct and substantial interest, unless the employee's 

participation is authorized by the agency under paragraph (c) of this section. 

(2)	 The restriction in paragraph (b)(1) of this section shall apply to a special Government 

employee who: 

(i) Is appointed by the President; 

(ii) Serves on a commission established by statute; or 

(iii)	 Has served or is expected to serve for more than 60 days in a period of 365 

consecutive days. 

(c)	 Authorization to serve as an expert witness. Provided that the employee's testimony will not 

violate any of the principles or standards set forth in this part, authorization to provide expert 

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witness service otherwise prohibited by paragraphs (a) and (b) of this section may be given by 

the designated agency ethics official of the agency in which the employee serves when: 

(1)	 After consultation with the agency representing the Government in the proceeding or, 

if the Government is not a party, with the Department of Justice and the agency with the 

most direct and substantial interest in the matter, the designated agency ethics official 

determines that the employee's service as an expert witness is in the interest of the 

Government; or 

(2)	 The designated agency ethics official determines that the subject matter of the testimony 

does not relate to the employee's official duties within the meaning of 

§ 2635.807(a)(2)(i). 

(d)	 Nothing in this section prohibits an employee from serving as a fact witness when subpoenaed 

by an appropriate authority. 

§ 2635.806 Participation in professional associations. [Reserved] 

§ 2635.807 Teaching, speaking and writing. 

(a)	 Compensation for teaching, speaking or writing. Except as permitted by paragraph (a)(3) of 

this section, an employee, including a special Government employee, shall not receive 

compensation from any source other than the Government for teaching, speaking or writing that 

relates to the employee's official duties. 

(1)	 Relationship to other limitations on receipt of compensation. The compensation 

prohibition contained in this section is in addition to any other limitation on receipt of 

compensation set forth in this chapter, including: 

(i)	 The requirement contained in § 2636.307 of this chapter that covered noncareer 

employees obtain advance authorization before engaging in teaching for 

compensation; and 

(ii)	 The prohibitions and limitations in § 2635.804 and in § 2636.304 of this chapter 

on receipt of outside earned income applicable to certain Presidential appointees 

and to other covered noncareer employees. 

(2) Definitions. For purposes of this paragraph: 

(i) Teaching, speaking or writing relates to the employee's official duties if: 

(A) The activity is undertaken as part of the employee's official duties; 

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(B)	 The circumstances indicate that the invitation to engage in the activity was 

extended to the employee primarily because of his official position rather 

than his expertise on the particular subject matter; 

(C)	 The invitation to engage in the activity or the offer of compensation for the 

activity was extended to the employee, directly or indirectly, by a person who 

has interests that may be affected substantially by performance or 

nonperformance of the employee's official duties; 

(D)	 The information conveyed through the activity draws substantially on ideas 

or official data that are nonpublic information as defined in § 2635.703(b); 

or 

(E)	 Except as provided in paragraph (a)(2)(i)(E)(4) of this section, the subject of 

the activity deals in significant part with: 

(1) Any matter to which the employee presently is assigned or to which the 

employee had been assigned during the previous one-year period; 

(2)	 Any ongoing or announced policy, program or operation of the agency; 

or 

(3)	 In the case of a noncareer employee as defined in § 2636.303(a) of this 

chapter, the general subject matter area, industry, or economic sector 

primarily affected by the programs and operations of his agency. 

(4)	 The restrictions in paragraphs (a)(2)(i)(E)(2) and (3) of this section do 

not apply to a special Government employee. The restriction in 

paragraph (a)(2)(i)(E)(1) of this section applies only during the current 

appointment of a special Government employee; except that if the 

special Government employee has not served or is not expected to serve 

for more than 60 days during the first year or any subsequent one-year 

period of that appointment, the restriction applies only to particular 

matters involving specific parties in which the special Government 

employee has participated or is participating personally and 

substantially. 

Note: Section 2635.807(a)(2)(i)(E) does not preclude an employee, other than a 

covered noncareer employee, from receiving compensation for teaching, speaking 

or writing on a subject within the employee's discipline or inherent area of 

expertise based on his educational background or experience even though the 

teaching, speaking or writing deals generally with a subject within the agency's 

areas of responsibility. 

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Example 1: The Director of the Division of Enforcement at the Commodity Futures Trading 

Commission has a keen interest in stamp collecting and has spent years developing his own 

collection as well as studying the field generally. He is asked by an international society of 

philatelists to give a series of four lectures on how to assess the value of American stamps. 

Because the subject does not relate to his official duties, the Director may accept compensation 

for the lecture series. He could not, however, accept a similar invitation from a commodities 

broker. 

Example 2: A scientist at the National Institutes of Health, whose principal area of 

Government research is the molecular basis of the development of cancer, could not be 

compensated for writing a book which focuses specifically on the research she conducts in her 

position at NIH, and thus, relates to her official duties. However, the scientist could receive 

compensation for writing or editing a textbook on the treatment of all cancers, provided that 

the book does not focus on recent research at NIH, but rather conveys scientific knowledge 

gleaned from the scientific community as a whole. The book might include a chapter, among 

many other chapters, which discusses the molecular basis of cancer development. Additionally, 

the book could contain brief discussions of recent developments in cancer treatment, even 

though some of those developments are derived from NIH research, as long as it is available 

to the public. 

Example 3: On his own time, a National Highway Traffic Safety Administration employee 

prepared a consumer's guide to purchasing a safe automobile that focuses on automobile crash 

worthiness statistics gathered and made public by NHTSA. He may not receive royalties or any 

other form of compensation for the guide. The guide deals in significant part with the 

programs or operations of NHTSA and, therefore, relates to the employee's official duties. On 

the other hand, the employee could receive royalties from the sale of a consumer's guide to 

values in used automobiles even though it contains a brief, incidental discussion of automobile 

safety standards developed by NHTSA. 

Example 4: An employee of the Securities and Exchange Commission may not receive 

compensation for a book which focuses specifically on the regulation of the securities industry 

in the United States, since that subject concerns the regulatory programs or operations of the 

SEC. The employee may, however, write a book about the advantages of investing in various 

types of securities as long as the book contains only an incidental discussion of any program 

or operation of the SEC. 

Example 5: An employee of the Department of Commerce who works in the Department's 

employee relations office is an acknowledged expert in the field of Federal employee labor 

relations, and participates in Department negotiations with employee unions. The employee 

may receive compensation from a private training institute for a series of lectures which 

describe the decisions of the Federal Labor Relations Authority concerning unfair labor 

practices, provided that her lectures do not contain any significant discussion of labor relations 

cases handled at the Department of Commerce, or the Department's labor relations policies. 

Federal Labor Relations Authority decisions concerning Federal employee unfair labor 

practices are not a specific program or operation of the Department of Commerce and thus do 

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not relate to the employee's official duties. However, an employee of the FLRA could not give 

the same presentations for compensation. 

Example 6: A program analyst employed at the Environmental Protection Agency may receive 

royalties and other compensation for a book about the history of the environmental movement 

in the United States even though it contains brief references to the creation and responsibilities 

of the EPA. A covered noncareer employee of the EPA, however, could not receive 

compensation for writing the same book because it deals with the general subject matter area 

affected by EPA programs and operations. Neither employee could receive compensation for 

writing a book that focuses on specific EPA regulations or otherwise on its programs and 

operations. 

Example 7: An attorney in private practice has been given a one year appointment as a special 

Government employee to serve on an advisory committee convened for the purpose of surveying 

and recommending modification of procurement regulations that deter small businesses from 

competing for Government contracts. Because his service under that appointment is not 

expected to exceed 60 days, the attorney may accept compensation for an article about the 

anticompetitive effects of certain regulatory certification requirements even though those 

regulations are being reviewed by the advisory committee. The regulations which are the focus 

of the advisory committee deliberations are not a particular matter involving specific parties. 

Because the information is nonpublic, he could not, however, accept compensation for an 

article which recounts advisory committee deliberations that took place in a meeting closed to 

the public in order to discuss proprietary information provided by a small business. 

Example 8: A biologist who is an expert in marine life is employed for more than 60 days in 

a year as a special Government employee by the National Science Foundation to assist in 

developing a program of grants by the Foundation for the study of coral reefs. The biologist 

may continue to receive compensation for speaking, teaching and writing about marine life 

generally and coral reefs specifically. However, during the term of her appointment as a 

special Government employee, she may not receive compensation for an article about the NSF 

program she is participating in developing. Only the latter would concern a matter to which 

the special Government employee is assigned. 

Example 9: An expert on international banking transactions has been given a one-year 

appointment as a special Government employee to assist in analyzing evidence in the 

Government's fraud prosecution of owners of a failed savings and loan association. It is 

anticipated that she will serve fewer than 60 days under that appointment. Nevertheless, during 

her appointment, the expert may not accept compensation for an article about the fraud 

prosecution, even though the article does not reveal nonpublic information. The prosecution 

is a particular matter that involves specific parties. 

(ii) 	 Agency has the meaning set forth in § 2635.102(a), except that any component of 

a department designated as a separate agency under § 2635.203(a) shall be 

considered a separate agency. 

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(iii)	 Compensation includes any form of consideration, remuneration or income, 

including royalties, given for or in connection with the employee's teaching, 

speaking or writing activities. Unless accepted under specific statutory authority, 

such as 31 U.S.C. 1353, 5 U.S.C. 4111 or 7342, or an agency gift acceptance 

statute, it includes transportation, lodgings and meals, whether provided in kind, 

by purchase of a ticket, by payment in advance or by reimbursement after the 

expense has been incurred. It does not include: 

(A)	 Items offered by any source that could be accepted from a prohibited source 

under subpart B of this part; 

(B)	 Meals or other incidents of attendance such as waiver of attendance fees or 

course materials furnished as part of the event at which the teaching or 

speaking takes place; 

(C)	 Copies of books or of publications containing articles, reprints of articles, 

tapes of speeches, and similar items that provide a record of the teaching, 

speaking or writing activity; or 

(D)	 In the case of an employee other than a covered noncareer employee as 

defined in 5 CFR 2636.303(a), travel expenses, consisting of transportation, 

lodgings or meals, incurred in connection with the teaching, speaking or 

writing activity. 

Note to Paragraph (a)(2)(iii): Independent of § 2635.807(a), other authorities, 

such as 18 U.S.C. 209, in some circumstances may limit or entirely preclude an 

employee’s acceptance of travel expenses. In addition, employees who file 

financial disclosure reports should be aware that, subject to applicable thresholds 

and exclusions, travel and travel reimbursements accepted from sources other than 

the United States Government must be reported on their financial disclosure 

reports. 

Example 1 to paragraph (a)(2)(iii): A GS–15 employee of the Forest Service has 

developed and marketed, in her private capacity, a speed reading technique for 

which popular demand is growing. She is invited to speak about the technique by 

a representative of an organization that will be substantially affected by a 

regulation on land management which the employee is in the process of drafting 

for the Forest Service. The representative offers to pay the employee a $200 

speaker’s fee and to reimburse all her travel expenses. She may accept the travel 

reimbursements, but not the speaker’s fee. The speaking activity is related to her 

official duties under § 2635.807(a)(2)(i)(C) and the fee is prohibited compensation 

for such speech; travel expenses incurred in connection with the speaking 

engagement, on the other hand, are not prohibited compensation for a GS–15 

employee. 

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Example 2 to paragraph (a)(2)(iii): Solely because of her recent appointment to a 

Cabinet-level position, a Government official is invited by the Chief Executive 

Officer of a major international corporation to attend firm meetings to be held in 

Aspen for the purpose of addressing senior corporate managers on the importance 

of recreational activities to a balanced lifestyle. The firm offers to reimburse the 

official’s travel expenses. The official may not accept the offer. The speaking 

activity is related to official duties under § 2635.807(a)(2)(i)(B) and, because she 

is a covered noncareer employee as defined in § 2636.303(a) of this chapter, the 

travel expenses are prohibited compensation as to her. 

Example 3 to paragraph (a)(2)(iii): A GS–14 attorney at the Federal Trade 

Commission (FTC) who played a lead role in a recently concluded merger case is 

invited to speak about the case, in his private capacity, at a conference in New 

York. The attorney has no public speaking responsibilities on behalf of the FTC 

apart from the judicial and administrative proceedings to which he is assigned. 

The sponsors of the conference offer to reimburse the attorney for expenses 

incurred in connection with his travel to New York. They also offer him, as 

compensation for his time and effort, a free trip to San Francisco. The attorney 

may accept the travel expenses to New York, but not the expenses to San 

Francisco. The lecture relates to his official duties under paragraphs 

(a)(2)(i)(E)(1) and (a)(2)(i)(E)(2) of § 2635.807, but because he is not a covered 

noncareer employee as defined in § 2636.303(a) of this chapter, the expenses 

associated with his travel to New York are not a prohibited form of compensation 

as to him. The travel expenses to San Francisco, on the other hand, not incurred 

in connection with the speaking activity, are a prohibited form of compensation. 

If the attorney were a covered noncareer employee he would be barred from 

accepting the travel expenses to New York as well as the travel expenses to San 

Francisco. 

Example 4 to paragraph (a)(2)(iii): An advocacy group dedicated to improving 

treatments for severe pain asks the National Institutes of Health (NIH) to provide 

a conference speaker who can discuss recent advances in the agency’s research 

on pain. The group also offers to pay the employee’s travel expenses to attend the 

conference. After performing the required conflict of interest analysis, NIH 

authorizes acceptance of the travel expenses under 31 U.S.C. 1353 and the 

implementing General Services Administration regulation, as codified under 41 

CFR chapter 304, and authorizes an employee to undertake the travel. At the 

conference the advocacy group, as agreed, pays the employee’s hotel bill and 

provides several of his meals. Subsequently the group reimburses the agency for 

the cost of the employee’s airfare and some additional meals. All of the payments 

by the advocacy group are permissible. Since the employee is speaking officially 

and the expense payments are accepted under 31 U.S.C. 1353, they are not 

prohibited compensation under § 2635.807(a)(2)(iii). The same result would obtain 

with respect to expense payments made by non-Government sources properly 

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authorized under an agency gift acceptance statute, the Government Employees 

Training Act, 5 U.S.C. 4111, or the foreign gifts law, 5 U.S.C. 7342. 

(iv)	 Receive means that there is actual or constructive receipt of the compensation by 

the employee so that the employee has the right to exercise dominion and control 

over the compensation and to direct its subsequent use. Compensation received 

by an employee includes compensation which is: 

(A)	 Paid to another person, including a charitable organization, on the basis of 

designation, recommendation or other specification by the employee; or 

(B)	 Paid with the employee's knowledge and acquiescence to his parent, sibling, 

spouse, child, or dependent relative. 

(v)	 Particular matter involving specific parties has the meaning set forth in 

§ 2637.102(a)(7) of this chapter. 

(vi)	 Personal and substantial participation has the meaning set forth in 

§ 2635.402(b)(4). 

(3)	 Exception for teaching certain courses. Notwithstanding that the activity would relate 

to his official duties under paragraphs (a)(2)(i) (B) or (E) of this section, an employee 

may accept compensation for teaching a course requiring multiple presentations by the 

employee if the course is offered as part of: 

(i) The regularly established curriculum of: 

(A) An institution of higher education as defined at 20 U.S.C. 1141(a); 

(B) An elementary school as defined at 20 U.S.C. 2891(8); or 

(C) A secondary school as defined at 20 U.S.C. 2891(21); or 

(ii) 	 A program of education or training sponsored and funded by the Federal 

Government or by a State or local government which is not offered by an entity 

described in paragraph (a)(3)(i) of this section. 

Example 1: An employee of the Cost Accounting Standards Board who teaches an 

advanced accounting course as part of the regular business school curriculum of an 

accredited university may receive compensation for teaching the course even though 

a substantial portion of the course deals with cost accounting principles applicable to 

contracts with the Government. 

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Example 2: An attorney employed by the Equal Employment Opportunity Commission 

may accept compensation for teaching a course at a state college on the subject of 

Federal employment discrimination law. The attorney could not accept compensation 

for teaching the same seminar as part of a continuing education program sponsored 

by her bar association because the subject of the course is focused on the operations 

or programs of the EEOC and the sponsor of the course is not an accredited 

educational institution. 

Example 3: An employee of the National Endowment for the Humanities is invited by 

a private university to teach a course that is a survey of Government policies in support 

of artists, poets and writers. As part of his official duties, the employee administers a 

grant that the university has received from the NEH. The employee may not accept 

compensation for teaching the course because the university has interests that may be 

substantially affected by the performance or nonperformance of the employee's duties. 

Likewise, an employee may not receive compensation for any teaching that is 

undertaken as part of his official duties or that involves the use of nonpublic 

information. 

(b)	 Reference to official position. An employee who is engaged in teaching, speaking or writing 

as outside employment or as an outside activity shall not use or permit the use of his official 

title or position to identify him in connection with his teaching, speaking or writing activity 

or to promote any book, seminar, course, program or similar undertaking, except that: 

(1)	 An employee may include or permit the inclusion of his title or position as one of 

several biographical details when such information is given to identify him in 

connection with his teaching, speaking or writing, provided that his title or position is 

given no more prominence than other significant biographical details; 

(2)	 An employee may use, or permit the use of, his title or position in connection with an 

article published in a scientific or professional journal, provided that the title or position 

is accompanied by a reasonably prominent disclaimer satisfactory to the agency stating 

that the views expressed in the article do not necessarily represent the views of the 

agency or the United States; and 

(3)	 An employee who is ordinarily addressed using a general term of address, such as "The 

Honorable," or a rank, such as a military or ambassadorial rank, may use or permit the 

use of that term of address or rank in connection with his teaching, speaking or writing. 

Note: Some agencies may have policies requiring advance agency review, clearance, or 

approval of certain speeches, books, articles or similar products to determine whether the 

product contains an appropriate disclaimer, discloses nonpublic information, or otherwise 

complies with this section. 

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Example 1: A meteorologist employed with the National Oceanic and Atmospheric 

Administration is asked by a local university to teach a graduate course on hurricanes. The 

university may include the meteorologist's Government title and position together with other 

information about his education and previous employment in course materials setting forth 

biographical data on all teachers involved in the graduate program. However, his title or 

position may not be used to promote the course, for example, by featuring the meteorologist's 

Government title, Senior Meteorologist, NOAA, in bold type under his name. In contrast, his 

title may be used in this manner when the meteorologist is authorized by NOAA to speak in 

his official capacity. 

Example 2: A doctor just employed by the Centers for Disease Control has written a paper 

based on his earlier independent research into cell structures. Incident to the paper's 

publication in the Journal of the American Medical Association, the doctor may be given 

credit for the paper, as Dr. M. Wellbeing, Associate Director, Centers for Disease Control, 

provided that the article also contains a disclaimer, concurred in by the CDC, indicating that 

the paper is the result of the doctor's independent research and does not represent the findings 

of the CDC. 

Example 3: An employee of the Federal Deposit Insurance Corporation has been asked to 

give a speech in his private capacity, without compensation, to the annual meeting of a 

committee of the American Bankers Association on the need for banking reform. The 

employee may be described in his introduction at the meeting as an employee of the Federal 

Deposit Insurance Corporation provided that other pertinent biographical details are 

mentioned as well. 

§ 2635.808 Fundraising activities. 

An employee may engage in fundraising only in accordance with the restrictions in part 950 of this 

title on the conduct of charitable fundraising in the Federal workplace and in accordance with 

paragraphs (b) and (c) of this section. 

(a) Definitions. For purposes of this section: 

(1)	 Fundraising means the raising of funds for a nonprofit organization, other than a 

political organization as defined in 26 U.S.C. 527(e), through: 

(i) Solicitation of funds or sale of items; or 

(ii) 	 Participation in the conduct of an event by an employee where any portion of the 

cost of attendance or participation may be taken as a charitable tax deduction by 

a person incurring that cost. 

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(2)	 Participation in the conduct of an event means active and visible participation in the 

promotion, production, or presentation of the event and includes serving as honorary 

chairperson, sitting at a head table during the event, and standing in a reception line. 

The term does not include mere attendance at an event provided that, to the employee's 

knowledge, his attendance is not used by the nonprofit organization to promote the 

event. While the term generally includes any public speaking during the event, it does 

not include the delivery of an official speech as defined in paragraph (a)(3) of this 

section or any seating or other participation appropriate to the delivery of such a 

speech. Waiver of a fee for attendance at an event by a participant in the conduct of 

that event does not constitute a gift for purposes of subpart B of this part. 

Note: This section does not prohibit fundraising for a political party, candidate for 

partisan political office, or partisan political group. However, there are statutory 

restrictions that apply to political fundraising. For example, under the Hatch Act 

Reform Amendments of 1993, at 5 U.S.C. 7323(a), employees may not knowingly 

solicit, accept, or receive a political contribution from any person, except under limited 

circumstances. In addition, employees are prohibited by 18 U.S.C. 607 from soliciting 

or receiving political contributions in Federal offices, and, except as permitted by the 

Hatch Act Reform Amendments, are prohibited by 18 U.S.C. 602 from knowingly 

soliciting political contributions from other employees. 

Example 1: The Secretary of Transportation has been asked to serve as master of 

ceremonies for an All-Star Gala. Tickets to the event cost $150 and are tax deductible 

as a charitable donation, with proceeds to be donated to a local hospital. By serving 

as master of ceremonies, the Secretary would be participating in fundraising. 

(3)	 Official speech means a speech given by an employee in his official capacity on a 

subject matter that relates to his official duties, provided that the employee's agency has 

determined that the event at which the speech is to be given provides an appropriate 

forum for the dissemination of the information to be presented and provided that the 

employee does not request donations or other support for the nonprofit organization. 

Subject matter relates to an employee's official duties if it focuses specifically on the 

employee's official duties, on the responsibilities, programs, or operations of the 

employee's agency as described in § 2635.807(a)(2)(i)(E), or on matters of 

Administration policy on which the employee has been authorized to speak. 

Example 1: The Secretary of Labor is invited to speak at a banquet honoring a 

distinguished labor leader, the proceeds of which will benefit a nonprofit organization 

that assists homeless families. She devotes a major portion of her speech to the 

Administration's Points of Light initiative, an effort to encourage citizens to volunteer 

their time to help solve serious social problems. Because she is authorized to speak on 

Administration policy, her remarks at the banquet are an official speech. However, the 

Secretary would be engaged in fundraising if she were to conclude her official speech 

with a request for donations to the nonprofit organization. 

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Example 2: A charitable organization is sponsoring a two-day tennis tournament at 

a country club in the Washington, DC area to raise funds for recreational programs 

for learning disabled children. The organization has invited the Secretary of Education 

to give a speech on federally funded special education programs at the awards dinner 

to be held at the conclusion of the tournament and a determination has been made that 

the dinner is an appropriate forum for the particular speech. The Secretary may speak 

at the dinner and, under § 2635.204(g)(1), he may partake of the meal provided to him 

at the dinner. 

(4)	 Personally solicit means to request or otherwise encourage donations or other support 

either through person-to-person contact or through the use of one's name or identity in 

correspondence or by permitting its use by others. It does not include the solicitation 

of funds through the media or through either oral remarks, or the contemporaneous 

dispatch of like items of mass-produced correspondence, if such remarks or 

correspondence are addressed to a group consisting of many persons, unless it is known 

to the employee that the solicitation is targeted at subordinates or at persons who are 

prohibited sources within the meaning of § 2635.203(d). It does not include 

behind-the-scenes assistance in the solicitation of funds, such as drafting 

correspondence, stuffing envelopes, or accounting for contributions. 

Example 1: An employee of the Department of Energy who signs a letter soliciting 

funds for a local private school does not "personally solicit" funds when 500 copies of 

the letter, which makes no mention of his DOE position and title, are mailed to 

members of the local community, even though some individuals who are employed by 

Department of Energy contractors may receive the letter. 

(b)	 Fundraising in an official capacity. An employee may participate in fundraising in an official 

capacity if, in accordance with a statute, Executive order, regulation or otherwise as 

determined by the agency, he is authorized to engage in the fundraising activity as part of his 

official duties. When authorized to participate in an official capacity, an employee may use 

his official title, position and authority. 

Example 1: Because participation in his official capacity is authorized under part 950 of this 

title, the Secretary of the Army may sign a memorandum to all Army personnel encouraging 

them to donate to the Combined Federal Campaign. 

(c)	 Fundraising in a personal capacity. An employee may engage in fundraising in his personal 

capacity provided that he does not: 

(1) Personally solicit funds or other support from a subordinate or from any person: 

(i)	 Known to the employee, if the employee is other than a special Government 

employee, to be a prohibited source within the meaning of § 2635.203(d); or 

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(ii)	 Known to the employee, if the employee is a special Government employee, to 

be a prohibited source within the meaning of § 2635.203(d)(4) that is a person 

whose interests may be substantially affected by performance or nonperformance 

of his official duties. 

(2)	 Use or permit the use of his official title, position or any authority associated with his 

public office to further the fundraising effort, except that an employee who is ordinarily 

addressed using a general term of address, such as "The Honorable," or a rank, such as 

a military or ambassadorial rank, may use or permit the use of that term of address or 

rank for such purposes; or 

(3) Engage in any action that would otherwise violate this part. 

Example 1: A nonprofit organization is sponsoring a golf tournament to raise funds for 

underprivileged children. The Secretary of the Navy may not enter the tournament with the 

understanding that the organization intends to attract participants by offering other entrants 

the opportunity, in exchange for a donation in the form of an entry fee, to spend the day 

playing 18 holes of golf in a foursome with the Secretary of the Navy. 

Example 2: An employee of the Merit Systems Protection Board may not use the agency's 

photocopier to reproduce fundraising literature for her son's private school. Such use of the 

photocopier would violate the standards at § 2635.704 regarding use of Government 

property. 

Example 3: An Assistant Attorney General may not sign a letter soliciting funds for a 

homeless shelter as "John Doe, Assistant Attorney General." He also may not sign a letter 

with just his signature, "John Doe," soliciting funds from a prohibited source, unless the 

letter is one of many identical, mass-produced letters addressed to a large group where the 

solicitation is not known to him to be targeted at persons who are either prohibited sources 

or subordinates. 

§ 2635.809 Just financial obligations. 

Employees shall satisfy in good faith their obligations as citizens, including all just financial 

obligations, especially those such as Federal, State, or local taxes that are imposed by law. For 

purposes of this section, a just financial obligation includes any financial obligation acknowledged 

by the employee or reduced to judgment by a court. In good faith means an honest intention to 

fulfill any just financial obligation in a timely manner. In the event of a dispute between an 

employee and an alleged creditor, this section does not require an agency to determine the validity 

or amount of the disputed debt or to collect a debt on the alleged creditor's behalf. 

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SUBPART I - RELATED STATUTORY AUTHORITIES 

§ 2635.901 General. 

In addition to the standards of ethical conduct set forth in subparts A through H of this part, there 

are a number of statutes that establish standards to which an employee's conduct must conform. 

The list set forth in § 2635.902 references some of the more significant of those statutes. It is not 

comprehensive and includes only references to statutes of general applicability. While it includes 

references to several of the basic conflict of interest statutes whose standards are explained in more 

detail throughout this part, it does not include references to statutes of more limited applicability, 

such as statutes that apply only to officers and employees of the Department of Defense. 

§ 2635.902 Related statutes. 

(a) The prohibition against solicitation or receipt of bribes (18 U.S.C. 201(b)). 

(b) The prohibition against solicitation or receipt of illegal gratuities (18 U.S.C. 201(c)). 

(c)	 The prohibition against seeking or receiving compensation for certain representational 

services before the Government (18 U.S.C. 203). 

(d)	 The prohibition against assisting in the prosecution of claims against the Government or 

acting as agent or attorney before the Government (18 U.S.C. 205). 

(e)	 The post-employment restrictions applicable to former employees (18 U.S.C. 207, with 

implementing regulations at parts 2637 and 2641 of this chapter). 

(f)	 The prohibition on certain former agency officials’ acceptance of compensation from a 

contractor (41 U.S.C. 423(d)). 

(g)	 The prohibition against participating in matters affecting an employee's own financial 

interests or the financial interests of other specified persons or organizations (18 U.S.C. 

208). 

(h)	 The actions required of certain agency officials when they contact, or are contacted by, 

offerors or bidders regarding non-Federal employment (41 U.S.C. 423(c)). 

(i)	 The prohibition against receiving salary or any contribution to or supplementation of salary 

as compensation for Government service from a source other than the United States 

(18 U.S.C. 209). 

(j) The prohibition against gifts to superiors (5 U.S.C. 7351). 

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(k)	 The prohibition against solicitation or receipt of gifts from specified prohibited sources 

(5 U.S.C. 7353). 

(l)	 The prohibition against fraudulent access and related activity in connection with computers 

(18 U.S.C. 1030). 

(m)	 The provisions governing receipt and disposition of foreign gifts and decorations (5 U.S.C. 

7342). 

(n) [Reserved] 

(o)	 The prohibitions against certain political activities (5 U.S.C. 7321 through 7326 and 18 

U.S.C. 602, 603, 606 and 607). 

(p) The prohibitions against disloyalty and striking (5 U.S.C. 7311 and 18 U.S.C. 1918). 

(q)	 The general prohibition (18 U.S.C. 219) against acting as the agent of a foreign principal 

required to register under the Foreign Agents Registration Act (22 U.S.C. 611 through 621). 

(r)	 The prohibition against employment of a person convicted of participating in or promoting 

a riot or civil disorder (5 U.S.C. 7313). 

(s)	 The prohibition against employment of an individual who habitually uses intoxicating 

beverages to excess (5 U.S.C. 7352). 

(t) The prohibition against misuse of a Government vehicle (31 U.S.C. 1344). 

(u) The prohibition against misuse of the franking privilege (18 U.S.C. 1719). 

(v) The prohibition against fraud or false statements in a Government matter (18 U.S.C. 1001). 

(w)	 The prohibition against concealing, mutilating or destroying a public record (18 U.S.C. 

2071). 

(x) The prohibition against counterfeiting or forging transportation requests (18 U.S.C. 508). 

(y)	 The restrictions on disclosure of certain sensitive Government information under the 

Freedom of Information Act and the Privacy Act (5 U.S.C. 552 and 552a). 

(z)	 The prohibitions against disclosure of classified information (18 U.S.C. 798 and 50 U.S.C. 

783(a)). 

(aa)	 The prohibition against disclosure of proprietary information and certain other information 

of a confidential nature (18 U.S.C. 1905). 

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(bb)	 The prohibitions on disclosing and obtaining certain procurement information (41 U.S.C. 

423(a) and (b)). 

(cc)	 The prohibition against unauthorized use of documents relating to claims from or by the 

Government (18 U.S.C. 285). 

(dd) The prohibition against certain personnel practices (5 U.S.C. 2302). 

(ee) The prohibition against interference with civil service examinations (18 U.S.C. 1917). 

(ff) The restrictions on use of public funds for lobbying (18 U.S.C. 1913). 

(gg)	 The prohibition against participation in the appointment or promotion of relatives (5 U.S.C. 

3110). 

(hh)	 The prohibition against solicitation or acceptance of anything of value to obtain public office 

for another (18 U.S.C. 211). 

(ii)	 The prohibition against conspiracy to commit an offense against or to defraud the United 

States (18 U.S.C. 371). 

(jj)	 The prohibition against embezzlement or conversion of Government money or property 

(18 U.S.C. 641). 

(kk) The prohibition against failing to account for public money (18 U.S.C. 643). 

(ll)	 The prohibition against embezzlement of the money or property of another person that is in 

the possession of an employee by reason of his employment (18 U.S.C. 654). 

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