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                            52.203-16 Preventing Personal Conflicts of Interest.
        
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FAC Number: 2024-03 Effective Date: 02/23/2024
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Subpart52.052.152.252.3
Section52.20052.20152.20252.20352.20452.20552.20652.20752.20852.20952.21052.21152.21252.21352.21452.21552.21652.21752.21852.21952.22052.22152.22252.22352.22452.22552.22652.22752.22852.22952.23052.23152.23252.23352.23452.23552.23652.23752.23852.23952.24052.24152.24252.24352.24452.24552.24652.24752.24852.24952.25052.25152.25252.253
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52.203-16 Preventing Personal Conflicts of Interest.52.203-16 Preventing Personal	Conflicts of Interest.       As prescribed	in 3.1106, insert the	following clause:          Preventing	Personal Conflicts of Interest (Jun 2020)                                       (a)                   *Definitions*.	As used in this clause—                *Acquisition function closely	associated with inherently governmental functions* means supporting	or providing advice or recommendations with regard to the following	activities of a Federal agency:(1) Planning acquisitions.                                                                     (2) Determining	what supplies or services are to be acquired by the Government,	including developing statements of work.                                                                     (3) Developing	or approving any contractual documents, to include documents defining	requirements, incentive plans, and evaluation criteria.                                                                     (4) Evaluating	contract proposals.                                                                     (5) Awarding	Government contracts.                                                                     (6) Administering	contracts (including ordering changes or giving technical direction	in contract performance or contract quantities, evaluating contractor	performance, and accepting or rejecting contractor products or services).                                                                     (7) Terminating	contracts.                                                                     (8) Determining	whether contract costs are reasonable, allocable, and allowable.                                                                         *Covered employee* means an individual	who performs an acquisition function closely associated with inherently	governmental functions and is—(1) An employee of the contractor;	or                                                                     (2) A subcontractor	that is a self-employed individual treated as a covered employee	of the contractor because there is no employer to whom such an individual	could submit the required disclosures.                                                                         *Non-public information* means any Government	or third-party information that-(1) Is exempt from disclosure under	the Freedom of Information Act (  5 U.S. C.552) or otherwise	protected from disclosure by statute, Executive order, or regulation;	or                                                                     (2) Has not	been disseminated to the general public and the Government has not	yet determined whether the information can or will be made available	to the public.                                                                         *Personal	conflict of interest* means a situation in which a covered employee	has a financial interest, personal activity, or relationship that	could impair the employee’s ability to act impartially and in the	best interest of the Government when performing under the contract.	(A de minimis interest that would not "impair the employee’s ability	to act impartially and in the best interest of the Government" is	not covered under this definition.)                                                         (1) 								                Among the sources of personal conflicts	of interest are-                                                                           (i) 										                    Financial interests of the covered	employee, of close family members, or of other members of the covered employee’s	household;                                                                              (ii) 										                    Other	employment or financial relationships (including seeking or negotiating	for prospective employment or business); and                                                                              (iii) 										                    Gifts,	including travel.                                                                                                           (2) 								                For example,	financial interests referred to in paragraph (1) of this definition	may arise from-                                                                           (i) 										                    Compensation, including wages,	salaries, commissions, professional fees, or fees for business referrals;                                                                              (ii) 										                    Consulting	relationships (including commercial and professional consulting	and service arrangements, scientific and technical advisory board	memberships, or serving as an expert witness in litigation);                                                                              (iii) 										                    Services	provided in exchange for honorariums or travel expense reimbursements;                                                                              (iv) 										                    Research	funding or other forms of research support;                                                                              (v) 										                    Investment	in the form of stock or bond ownership or partnership interest (excluding	diversified mutual fund investments);                                                                              (vi) 										                    Real estate	investments;                                                                              (vii) 										                    Patents,	copyrights, and other intellectual property interests; or                                                                              (viii) 										                    Business	ownership and investment interests.                                                                                                                            (b)                   *Requirements*.	The Contractor shall—(1) Have procedures in place to screen	covered employees for potential personal conflicts of interest,	by-                                                                                    (i) Obtaining and maintaining from	each covered employee, when the employee is initially assigned to	the task under the contract, a disclosure of interests that might	be affected by the task to which the employee has been assigned, as	follows:                                                                                                      (A) Financial interests of the covered	employee, of close family members, or of other members of the covered employee’s	household.                                                                                                         (B) Other	employment or financial relationships of the covered employee (including	seeking or negotiating for prospective employment or business).                                                                                                         (C) Gifts,	including travel; and                                                                                                                                                        (ii) Requiring	each covered employee to update the disclosure statement whenever	the employee’s personal or financial circumstances change in such	a way that a new personal conflict of interest might occur because	of the task the covered employee is performing.                                                                                                                          (2) For each	covered employee—                                                                                    (i) Prevent personal conflicts of	interest, including not assigning or allowing a covered employee	to perform any task under the contract for which the Contractor	has identified a personal conflict of interest for the employee	that the Contractor or employee cannot satisfactorily prevent or	mitigate in consultation with the contracting agency;                                                                                       (ii) Prohibit	use of non-public information accessed through performance of a	Government contract for personal gain; and                                                                                       (iii) Obtain	a signed non-disclosure agreement to prohibit disclosure of non-public	information accessed through performance of a Government contract.                                                                                                                          (3) Inform	covered employees of their obligation-                                                                                    (i) To disclose	and prevent personal conflicts of interest;                                                                                       (ii) Not to	use non-public information accessed through performance of a Government	contract for personal gain; and                                                                                       (iii) To avoid	even the appearance of personal conflicts of interest;                                                                                                                          (4) Maintain	effective oversight to verify compliance with personal conflict-of-interest	safeguards;                                                                     (5) Take appropriate	disciplinary action in the case of covered employees who fail to	comply with policies established pursuant to this clause; and                                                                     (6) Report	to the Contracting Officer any personal conflict-of-interest violation	by a covered employee as soon as it is identified. This report shall	include a description of the violation and the proposed actions	to be taken by the Contractor in response to the violation. Provide	follow-up reports of corrective actions taken, as necessary. Personal	conflict-of-interest violations include-                                                                                    (i) Failure by	a covered employee to disclose a personal conflict of interest;                                                                                       (ii) Use by	a covered employee of non-public information accessed through performance	of a Government contract for personal gain; and                                                                                       (iii) Failure	of a covered employee to comply with the terms of a non-disclosure	agreement.                                                                                                                                                        (c) 						            Mitigation	or waiver.                                                         (1) 								                In exceptional circumstances, if	the Contractor cannot satisfactorily prevent a personal conflict	of interest as required by paragraph (b)(2)(i) of this clause, the	Contractor may submit a request through the Contracting Officer	to the Head of the Contracting Activity for-                                                                           (i) 										                    Agreement	to a plan to mitigate the personal conflict of interest; or                                                                              (ii) 										                    A waiver	of the requirement.                                                                                                           (2) 								                The Contractor	shall include in the request any proposed mitigation of the personal	conflict of interest.                                                            (3) 								                The Contractor	shall-                                                                           (i) 										                    Comply, and require compliance	by the covered employee, with any conditions imposed by the Government	as necessary to mitigate the personal conflict of interest; or                                                                              (ii) 										                    Remove	the Contractor employee or subcontractor employee from performance	of the contract or terminate the applicable subcontract.                                                                                                                            (d)                   *Subcontract*s. The Contractor shall include	the substance of this clause, including this paragraph (d), in subcontracts—                                                         (1) 								                That exceed the simplified	acquisition threshold, as defined in Federal Acquisition Regulation  2.101 on the date of subcontract	award; and                                                            (2) 								                In which	subcontractor employees will perform acquisition functions closely	associated with inherently governmental functions (*i.e.*,	instead of performance only by a self-employed individual).                                                                    (End of clause)    **Parent topic:**  52.203 [Reserved]
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