[Title 22 CFR ]
[Code of Federal Regulations (annual edition) - April 1, 1998 Edition]
[From the U.S. Government Printing Office]


[[Page i]]

          22



          Foreign Relations



          PARTS 1 TO 299

                         Revised as of April 1, 1998

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT
          AS OF APRIL 1, 1998

          With Ancillaries
          Published by
          the Office of the Federal Register
          National Archives and Records
          Administration
          as a Special Edition of
          the Federal Register



[[Page ii]]

                                      




                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 1998



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v


  Title 22:
    Chapter I--Department of State............................       3
    Chapter II--Agency for International Development, 
        International Development Cooperation Agency..........     609
  Finding Aids:
    Material Approved for Incorporation by Reference..........     871
    Table of CFR Titles and Chapters..........................     873
    Alphabetical List of Agencies Appearing in the CFR........     889
    Redesignation Tables......................................     899
    List of CFR Sections Affected.............................     905



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   Cite this Code:  CFR

   To cite the regulations in this volume use title, part and
   section number. Thus,  22 CFR 1.1 refers to title 22, part
   1, section 1.

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                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, April 1, 1998), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
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instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
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OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
requirement to publish regulations in the Federal Register by referring 
to materials already published elsewhere. For an incorporation to be 
valid, the Director of the Federal Register must approve it. The legal 
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This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
containing that incorporation. If, after contacting the agency, you find 
the material is not available, please notify the Director of the Federal 
Register, National Archives and Records Administration, Washington DC 
20408, or call (202) 523-4534.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I), and Acts Requiring Publication 
in the Federal Register (Table II). A list of CFR titles, chapters, and 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.

[[Page vii]]

    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408.

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site also contains links to GPO Access.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

April 1, 1998.



[[Page ix]]



                               THIS TITLE

    Title 22--Foreign Relations is composed of two volumes. The first 
volume, Parts 1 to 299 contains Chapter I--Department of State 
regulations and Chapter II--Agency for International Development, 
International Development Cooperation Agency regulations. The second 
volume, Part 300 to End is composed of Chapter III--Peace Corps; Chapter 
IV--International Joint Commission, United States and Canada; Chapter 
V--United States Information Agency; Chapter VI--United States Arms 
Control and Disarmament Agency; Chapter VII--Overseas Private Investment 
Corporation, International Development Cooperation Agency; Chapter IX--
Foreign Service Grievance Board Regulations; Chapter X--Inter-American 
Foundation; Chapter XI--International Boundary and Water Commission, 
United States and Mexico, United States Section; Chapter XII--United 
States International Development Cooperation Agency; Chapter XIII--Board 
for International Broadcasting; Chapter XIV--Foreign Service Labor 
Relations Board; Federal Labor Relations Authority; General Counsel of 
the Federal Labor Relations Authority; and the Foreign Service Impasse 
Disputes Panel; Chapter XV--African Development Foundation; Chapter 
XVI--Japan-United States Friendship Commission; and Chapter XVII--United 
States Institute of Peace. The contents of these volumes represent all 
current regulations codified under this title of the CFR as of April 1, 
1998.

    Redesignation tables appear in the Finding Aids section of these 
volumes.

    For this volume, Carol Conroy was Chief Editor. The Code of Federal 
Regulations publication program is under the direction of Frances D. 
McDonald, assisted by Alomha S. Morris.

[[Page x]]




[[Page 1]]



                       TITLE 22--FOREIGN RELATIONS




                   (This book contains parts 1 to 299)

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                                                                    Part

Chapter i--Department of State..............................           1

Chapter ii--Agency for International Development, 
  International Development Cooperation Agency..............         200


Cross References: U.S. Customs Service, Department of the Treasury: See 
  Customs Duties, 19 CFR chapter I.

  International Trade Administration, Department of Commerce: See 
Commerce and Foreign Trade, 15 CFR chapter III.

  Foreign-Trade Zones Board, Department of Commerce: See Commerce and 
Foreign Trade, 15 CFR chapter IV.

  Immigration and Naturalization Service, Department of Justice: See 
Aliens and Nationality, 8 CFR chapter I.

  Taxation pursuant to treaties: See Internal Revenue, 26 CFR 1.894-1.

[[Page 3]]



                     CHAPTER I--DEPARTMENT OF STATE




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                          SUBCHAPTER A--GENERAL
Part                                                                Page
1               Insignia of rank............................           7
2               Protection of foreign dignitaries and other 
                    official personnel......................           7
3               Gifts and decorations from foreign 
                    governments.............................           9
3a              Acceptance of employment from foreign 
                    governments by members of the uniformed 
                    services................................          15
4               Notification of foreign official status.....          17
5               Organization................................          18
7               Board of Appellate Review...................          19
8               Advisory committee management...............          24
9               Security information regulations............          29
9a              Security information regulations applicable 
                    to certain international energy 
                    programs; related material..............          40
9b              Regulations governing Department of State 
                    press building passes...................          42
                         SUBCHAPTER B--PERSONNEL
10              Employee responsibilities and conduct.......          46
11              Appointment of Foreign Service officers.....          63
12              Complaints  against  employees  by  alleged 
                    creditors...............................          81
13              Personnel...................................          81
16              Foreign Service grievance system............          82
17              Overpayments to annuitants under the Foreign 
                    Service retirement and disability system          90
18              Regulations concerning post employment 
                    conflict of interest....................          92
19              Benefits for spouses and former spouses of 
                    participants in the Foreign Service 
                    retirement and disability system........          96
20              Benefits for certain former spouses.........         118

[[Page 4]]

21              Indemnification of employees................         121
                      SUBCHAPTER C--FEES AND FUNDS
22              Schedule of fees for consular services--
                    Department of State and Foreign Service.         123
23              Finance and accounting......................         127
                SUBCHAPTER D--CLAIMS AND STOLEN PROPERTY
32              Stolen property under treaty with Mexico....         129
33              Fishermen's Protective Act Guaranty Fund 
                    procedures under section 7..............         129
34              Collection of debts.........................         134
35              Program fraud civil remedies................         141
                           SUBCHAPTER E--VISAS
40              Regulations pertaining to both nonimmigrants 
                    and immigrants under the Immigration and 
                    Nationality Act, as amended.............         158
41              Visas: Documentation of nonimmigrants under 
                    the Immigration and Nationality Act, as 
                    amended.................................         170
42              Visas: Documentation of immigrants under the 
                    Immigration and Nationality Act, as 
                    amended.................................         205
43-44

[Reserved]

45              Visas: Documentation of immigrants under 
                    section 124 of Public Law 101-649.......         229
46              Control of aliens departing from the United 
                    States..................................         231
47

[Reserved]

                 SUBCHAPTER F--NATIONALITY AND PASSPORTS
50              Nationality procedures......................         237
51              Passports...................................         241
52              Marriages...................................         255
53              Passport requirement and exceptions.........         256
                        SUBCHAPTER G--[RESERVED]

 SUBCHAPTER H--PROTECTION AND WELFARE OF AMERICANS, THEIR PROPERTY AND 
                                 ESTATES

71              Protection and welfare of citizens and their 
                    property................................         259

[[Page 5]]

72              Deaths and estates..........................         262
                    SUBCHAPTER I--SHIPPING AND SEAMEN
89              Prohibitions on longshore work by U.S. 
                    nationals...............................         278
                SUBCHAPTER J--LEGAL AND RELATED SERVICES
91              Import controls.............................         285
92              Notarial and related services...............         285
93              Service on foreign state....................         314
94              International child abduction...............         315
     SUBCHAPTER K--ECONOMIC, COMMERCIAL AND CIVIL AVIATION FUNCTIONS
101             Economic and commercial functions...........         319
102             Civil aviation..............................         320
                         SUBCHAPTER L [RESERVED]
         SUBCHAPTER M--INTERNATIONAL TRAFFIC IN ARMS REGULATONS
120             Purpose and definitions.....................         327
121             The United States munitions list............         334
122             Registration of manufacturers and exporters.         353
123             Licenses for the export of defense articles.         355
124             Agreements, off-shore procurement and other 
                    defense services........................         367
125             Licenses for the export of technical data 
                    and classified defense articles.........         377
126             General policies and provisions.............         382
127             Violations and penalties....................         390
128             Administrative procedures...................         396
129             Registration and licensing of brokers.......         402
130             Political contributions, fees and 
                    commissions.............................         406
                       SUBCHAPTER N--MISCELLANEOUS
131             Certificates of authentication..............         412
132             Books, maps, newspapers, etc................         412
134             Equal Access to Justice Act; implementation.         412
135             Uniform administrative requirements for 
                    grants and cooperative agreements to 
                    state and local governments.............         418
136             Personal property disposition at posts 
                    abroad..................................         445
137             Governmentwide debarment and suspension 
                    (nonprocurement) and governmentwide 
                    requirements for drug-free workplace 
                    (grants)................................         449

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138             New restrictions on lobbying................         467
                       SUBCHAPTER O--CIVIL RIGHTS
141             Nondiscrimination in federally-assisted 
                    programs of the Department of State--
                    effectuation of title VI of the Civil 
                    Rights Act of 1964......................         479
142             Nondiscriminating on the basis of handicap 
                    in programs and activities receiving 
                    Federal financial assistance............         488
143             Nondiscrimination on the basis of age in 
                    programs or activities receiving Federal 
                    financial assistance....................         501
144             Enforcement of non-discrimination on the 
                    basis of handicap in programs or 
                    activities conducted by the United 
                    States Department of State..............         505
145             Grants and agreements with institutions of 
                    higher education, hospitals, and other 
                    non-profit organizations................         512
           SUBCHAPTER P--DIPLOMATIC PRIVILEGES AND IMMUNITIES
151             Compulsory liability insurance for 
                    diplomatic missions and personnel.......         539
                 SUBCHAPTER Q--ENVIRONMENTAL PROTECTION
161             Regulations for implementation of the 
                    National Environmental Policy Act (NEPA)         542
                   SUBCHAPTER R--ACCESS TO INFORMATION
171             Availability of information and records to 
                    the public..............................         555
172             Service of process; production or disclosure 
                    of official information in response to 
                    court orders, subpoenas, notices of 
                    depositions, requests for admissions, 
                    interrogatories, or similar requests or 
                    demands in connection with Federal or 
                    State litigation; expert testimony......         577
                 SUBCHAPTER S--INTERNATIONAL AGREEMENTS
181             Coordination, reporting and publication of 
                    international agreements................         582
                      SUBCHAPTER T--HOSTAGE RELIEF
191             Hostage relief assistance...................         589
192             Victims of terrorism compensation...........         596
193             Benefits for hostages in Iraq, Kuwait, or 
                    Lebanon.................................         607

[[Page 7]]



                          SUBCHAPTER A--GENERAL





PART 1--INSIGNIA OF RANK--Table of Contents




Sec.
1.1  Office of the Secretary of State.
1.2  Office of the Deputy Secretary of State.
1.3  Office of the Under Secretaries of State.

    Authority:  Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658.



Sec. 1.1  Office of the Secretary of State.

    The official flag indicative of the office of Secretary of State 
shall be as follows: On a blue rectangular field a white disk bearing 
the official coat of arms of the United States adopted by the act of 
June 20, 1782, in proper colors. In each of the four corners a white 
five-pointed star with one point upward. The colors and automobile flag 
to be the same design, adding a white fringe. For the colors a cord and 
tassel of blue and white to be added. The sizes to be in accordance with 
military and naval customs.
[22 FR 10788, Dec. 27, 1957]



Sec. 1.2  Office of the Deputy Secretary of State.

    The official flag indicative of the office of the Deputy Secretary 
of State shall be as follows: On a white rectangular field a blue disk 
bearing the official coat of arms of the United States adopted by act of 
June 20, 1782, in proper colors. In each of the four corners a five-
pointed star with one point upward. The colors and automobile flag to be 
the same design, adding a blue fringe. For the colors a cord and tassel 
of white in accordance with military and naval customs.
[38 FR 30258, Nov. 2, 1973]



Sec. 1.3  Office of the Under Secretaries of State.

    The official flag indicative of the office of the Under Secretaries 
of State shall be as follows: On a red rectangular field a white disk 
bearing the official coat of arms of the United States adopted by act of 
June 20, 1782, in proper colors. In each of the four corners a white 
five-pointed star with one point upward. The colors and automobile flag 
to be the same design, adding a white fringe. For the colors a cord and 
tassel of white and red to be added. The sizes to be in accordance with 
military and naval customs.
[38 FR 30258, Nov. 2, 1973]



PART 2--PROTECTION OF FOREIGN DIGNITARIES AND OTHER OFFICIAL PERSONNEL--Table of Contents




Sec.
2.1  Designation of personnel to carry firearms and exercise appropriate 
          power of arrest.
2.2  Purpose.
2.3  Notification of foreign officials.
2.4  Designation of official guests.
2.5  Records.



Sec. 2.1  Designation of personnel to carry firearms and exercise appropriate power of arrest.

    (a) The Deputy Assistant Secretary of State for Security is 
authorized to designate certain employees of the Department of State and 
the Foreign Service, as well as employees of other departments and 
agencies detailed to and under the supervision and control of the 
Department of State, as Security Officers, as follows.
    (1) Persons so designated shall be authorized to carry firearms when 
engaged in the performance of the duties prescribed in section (1) of 
the act of June 28, 1955, 69 Stat. 188, as amended. No person shall be 
so designated unless he has either qualified in the use of firearms in 
accordance with standards established by the Deputy Assistant Secretary 
of State for Security, or in accordance with standards established by 
the department or agency from which he is detailed.
    (2) Persons so designated shall also be authorized, when engaged in 
the performance of duties prescribed in section (1) of the act of June 
28, 1955, 69 Stat. 188, as amended, to arrest without warrant and 
deliver into custody any person violating the provisions of section 111 
or 112 of title 18, United States Code, in their presence or if they 
have reasonable grounds to believe that the person to be arrested has

[[Page 8]]

committed or is committing such felony.
    (b) When the Under Secretary of State for Management determines that 
it is necessary, persons designated under paragraph (a) of this section 
shall be authorized to provide protection to an individual who has been 
designated by the President to serve as Secretary of State, prior to his 
appointment, or to a departing Secretary of State. In providing such 
protection, they are authorized to exercise the authorities described in 
paragraphs (a) (1) and (2) of section. Such protection shall be for the 
period or periods determined necessary by the Under Secretary of State 
for Management, except that in the case of a departing Secretary of 
State, the period of protection under this paragraph shall in no event 
exceed 30 calendar days from the date of termination of that 
individual's incumbency as Secretary of State.
    (c) When the Under Secretary of State for Management determines that 
it is necessary, persons designated under paragraph (a) of this section 
shall be authorized to provide protection to a departing United States 
Representative to the United Nations. In providing such protection, they 
are authorized to exercise the authorities described in paragraphs (a) 
(1) and (2) of this section. Such protection shall be for the period or 
periods determined necessary by the Under Secretary of State for 
Management, except that the period of protection under this paragraph 
shall in no event exceed 30 calendar days from the date of termination 
of that individual's incumbency as United States Representative to the 
United Nations.

(Sec. 4, 63 Stat. 111, as amended, sec. 1, 69 Stat. 188; 22 U.S.C. 2658, 
2666)
[29 FR 15571, Nov. 20, 1964, as amended at 47 FR 30480, July 14, 1982; 
50 FR 14379, Apr. 12, 1985]



Sec. 2.2  Purpose.

    Section 1116(b)(2) of title 18 of the United States Code, as added 
by Pub. L. 92-539, An Act for the Protection of Foreign Officials and 
Official Guests of the United States (86 Stat. 1071), defines the term 
``foreign official'' for purposes of that Act as ``any person of a 
foreign nationality who is duly notified to the United States as an 
officer or employee of a foreign government or international 
organization, and who is in the United States on official business, and 
any member of his family whose presence in the United States is in 
connection with the presence of such officer or employee.'' Section 
1116(c)(4) of the same Act defines the term ``official guest'' for the 
purposes of that Act as ``a citizen or national of a foreign country 
present in the United States as an official guest of the Government of 
the United States pursuant to designation as such by the Secretary of 
State.'' It is the purpose of this regulation to specify the officer of 
the Department of State who shall be responsible for receiving 
notification of foreign officials under the Act and determining whether 
persons are ``duly notified'' to the United States and who shall be 
responsible for processing official guest designations by the Secretary 
of State.

(18 U.S.C. 1116(b)(2), 1116(c)(4); sec. 4 of the Act of May 26, 1949, as 
amended (22 U.S.C. 2658))
[37 FR 24817, Nov. 22, 1972]



Sec. 2.3  Notification of foreign officials.

    (a) Any notification of a foreign official for purposes of section 
1116(b)(2) of Title 18 of the United States Code shall be directed by 
the foreign government or international organization concerned to the 
Chief of Protocol, Department of State, Washington, DC 20520. For 
persons normally accredited to the United States in diplomatic or 
consular capacities and also for persons normally accredited to the 
United Nations and other international organizations and in turn 
notified to the Department of State, the procedure for placing a person 
in the statutory category of being ``duly notified to the United 
States'' shall be the current procedure for accreditation, with 
notification in turn when applicable. The Chief of the Office of 
Protocol will place on the roster of persons ``duly notified to the 
United States'' the names of all persons currently accredited and, when 
applicable, notified in turn, and will maintain the roster as part of 
the official files of the Department of State adding to and deleting 
therefrom as changes in accreditations occur.

[[Page 9]]

    (b) For those persons not normally accredited, the Chief of Protocol 
shall determine upon receipt of notification, by letter from the foreign 
government or international organization concerned, whether any person 
who is the subject of such a notification has been duly notified under 
the Act. Any inquiries by law enforcement officers or other persons as 
to whether a person has been duly notified shall be directed to the 
Chief of Protocol. The determination of the Chief of Protocol that a 
person has been duly notified is final.

(18 U.S.C. 1116(b)(2), 1116(c)(4); sec. 4 of the Act of May 26, 1949, as 
amended (22 U.S.C. 2658))
[37 FR 24818, Nov. 22, 1972]



Sec. 2.4  Designation of official guests.

    The Chief of Protocol shall also maintain a roster of persons 
designated by the Secretary of State as official guests. Any inquiries 
by law enforcement officers or other persons as to whether a person has 
been so designated shall be directed to the Chief of Protocol. The 
designation of a person as an official guest is final. Pursuant to 
section 2658 of title 22 of the U.S.C., the authority of the Secretary 
of State to perform the function of designation of official guests is 
hereby delegated to the Chief of Protocol.

(22 U.S.C. 2658)
[45 FR 55716, Aug. 21, 1980]



Sec. 2.5  Records.

    The Chief of Protocol shall maintain as a part of the official files 
of the Department of State a cumulative roster of all persons who have 
been duly notified as foreign officials or designated as official guests 
under this part. The roster will reflect the name, position, 
nationality, and foreign government or international organization 
concerned or purpose of visit as an official guest and reflect the date 
the person was accorded recognition as being ``duly notified to the 
United States'' or designated as an official guest and the date, if any, 
of termination of such status.

(18 U.S.C. 1116(b)(2), 1116(c)(4); sec. 4 of the Act of May 26, 1949, as 
amended (22 U.S.C. 2658))
[37 FR 24818, Nov. 22, 1972]



PART 3--GIFTS AND DECORATIONS FROM FOREIGN GOVERNMENTS--Table of Contents




Sec.
3.1  Purpose.
3.2  Authority.
3.3  Definitions.
3.4  Restriction on acceptance of gifts and decorations.
3.5  Designation of officials and offices responsible for administration 
          of foreign gifts and decorations.
3.6  Procedure to be followed by employees in depositing gifts of more 
          than minimal value and reporting acceptance of travel or 
          travel expenses.
3.7  Decorations.
3.8  Approval of retention of gifts or decorations with employing agency 
          for official use.
3.9  Disposal of gifts and decorations which become the property of the 
          United States.
3.10  Enforcement.
3.11  Responsibility of chief of mission to inform host government of 
          restrictions on employees' receipt of gifts and decorations.
3.12  Exemption of grants and other foreign government assistance in 
          cultural exchange programs from coverage of foreign gifts and 
          decorations legislation.

    Authority:  Sec. 515(a)(1), 91 Stat. 862, amending 5 U.S.C. 7342 
(1976).

    Source:  45 FR 80819, Dec. 8, 1980, unless otherwise noted.



Sec. 3.1  Purpose.

    These regulations provide basic standards for employees of the 
Department of State, the United States International Development 
Cooperation Agency (IDCA), the Agency for International Development 
(AID), and the International Communication Agency (USICA), their spouses 
(unless separated) and their dependents to accept and retain gifts and 
decorations from foreign governments.



Sec. 3.2  Authority.

    (a) Section 515(a)(1) of the Foreign Relations Authorization Act of 
1978 (91 Stat. 862-866), approved August 17, 1977, (hereafter referred 
to as ``the Act'') amended section 7342 of title 5, U.S.

[[Page 10]]

Code (1976), making substantial changes in the law relating to the 
acceptance and retention of gifts and decorations from foreign 
governments.
    (b) 5 U.S.C. 7342(g) authorizes each employing agency to prescribe 
regulations as necessary to carry out the new law.



Sec. 3.3  Definitions.

    When used in this part, the following terms have the meanings 
indicated:
    (a) Employee means (1) an officer or employee of the Department, 
AID, IDCA, or USICA, including an expert or consultant, however 
appointed, and (2) a spouse (unless separated) or a dependent of such a 
person, as defined in section 152 of the Internal Revenue Code of 1954 
(26 U.S.C. 152).
    (b) Foreign government means: (1) Any unit of foreign governmental 
authority, including any foreign national, State, local, or municipal 
government; (2) any international or multinational organization whose 
membership is composed of any unit of foreign government as described in 
paragraph (b)(1) of this section; (3) any agent or representative of any 
such unit or organization, while acting as such;
    (c) Gift means a tangible or intangible present (other than a 
decoration) tendered by, or received from, a foreign government;
    (d) Decoration means an order, device, medal, badge, insignia, 
emblem or award tendered by, or received from, a foreign government;
    (e) Minimal value means retail value in the United States at the 
time of acceptance of $100 or less, except that on January 1, 1981, and 
at 3-year intervals thereafter, ``minimal value'' is to be redefined in 
regulations prescribed by the Administrator of General Services, in 
consultation with the Secretary of State, to reflect changes in the 
consumer price index for the immediately preceding 3-year period.



Sec. 3.4  Restriction on acceptance of gifts and decorations.

    (a) An employee is prohibited from requesting or otherwise 
encouraging the tender of a gift or decoration from a foreign 
government. An employee is also prohibited from accepting a gift or 
decoration from a foreign government, except in accordance with these 
regulations.
    (b) An employee may accept and retain a gift of minimal value 
tendered and received as a souvenir or mark of courtesy, subject, 
however, to the following restrictions--
    (1) Where more than one tangible item is included in a single 
presentation, the entire presentation shall be considered as one gift, 
and the aggregate value of all items taken together must not exceed 
``minimal value''.
    (2) The donee is responsible for determining that a gift is of 
minimal value in the United States at the time of acceptance. However, 
should any dispute result from a difference of opinion concerning the 
value of a gift, the employing agency will secure the services of an 
outside appraiser to establish whether the gift is one of ``minimal 
value''. If, after an appraisal has been made, it is established that 
the value of the gift in question is $200 or more at retail in the 
United States, the donee will bear the costs of the appraisal. If, 
however, the appraised value is established to be less than $200, the 
employing agency will bear the costs.
    (c) An employee may accept a gift of more than minimal value when 
(1) such gift is in the nature of an educational scholarship or medical 
treatment, or (2) it appears that to refuse the gift would likely cause 
offense or embarrassment or otherwise adversely affect the foreign 
relations of the United States, except that a tangible gift of more than 
minimal value is deemed to have been accepted on behalf of the United 
States and, upon acceptance, shall become the property of the United 
States.
    (d) An employee may accept gifts of travel or expenses for travel 
taking place entirely outside the United States (such as transportation, 
food, and lodging) of more than minimal value if such acceptance is 
appropriate, consistent with the interests of the United States, and 
permitted by the employing agency. Except where the employing agency has 
specific interests which may be favorably affected by employee travel 
wholly outside the United States, even though it would not normally 
authorize its employees

[[Page 11]]

to engage in such travel, the standards normally applied to determine 
when proposed travel will be in the best interests of the employing 
agency and of the United States Government shall be applied in approving 
acceptance of travel or travel expenses offered by a foreign government.
    (1) There are two circumstances under which employees may accept 
gifts of travel or expenses:
    (i) When the employee is issued official travel orders placing him 
or her in the position of accepting travel or travel expenses offered by 
a foreign government which are directly related to the authorized 
purpose of the travel; or
    (ii) When the employee's travel orders specifically anticipate the 
acceptance of additional travel and travel expenses incident to the 
authorized travel.
    (2) When an employee is traveling under circumstances described in 
paragraph (d)(1)(i) of this section, that is, without specific 
instructions authorizing acceptance of additional travel expenses from a 
foreign government, the employee must file a report with the employing 
angency under the procedures prescribed in Sec. 3.6.
    (e) Since tangible gifts of more than minimal value may not lawfully 
become the personal property of the donee, all supervisory officials 
shall, in advising employees of their responsibilities under the 
regulations, impress upon them their obligation to decline acceptance of 
such gifts, whenever possible, at the time they are offered, or to 
return them if they have been sent or delivered without a prior offer. 
All practical measures, such as periodic briefings, shall be taken to 
minimize the number of gifts which employees must deposit and which thus 
become subject to disposal as provided by law and regulation. Employees 
should not accept gifts of more than minimal value on the assumption 
that refusal would be likely to ``cause offense or embarrassment or 
otherwise adversely affect the foreign relations of the United States''. 
In many instances it should be possible, by explanation of the 
prohibition against an employee's retention of such gifts, to avoid 
consequences of acceptance, including possible return of the gift to the 
donor. Refusal of the gift at the inception should typically be regarded 
as in the interest both of the foreign government donor and the U.S. 
Government.



Sec. 3.5  Designation of officials and offices responsible for administration of foreign gifts and decorations.

    (a) The Act effects a significant degree of decentralization of 
administration relative to the disposal of foreign gifts and decorations 
which become U.S. Government property. Each agency is now responsible 
for receiving from its employees deposits of foreign gifts of more than 
minimal value, as well as of foreign decorations not meeting the 
statutory criteria for retention by the recipient. The agency is also 
responsible for disposing of this property by return to the donor, for 
retaining it in the agency if official use of it is approved, for 
reporting to the General Services Administration within 30 calendar days 
after deposit items neither disposed of nor retained, and for assuming 
custody, proper care and handling of such property pending removal from 
that custody pursuant to disposal arrangements by the General Services 
Administration. The Secretary of State, however, is made responsible for 
providing guidance to other executive agencies in the development of 
their own regulations to implement the Act, as well as for the annual 
publication of lists of all gifts of more than minimal value deposited 
by Federal employees during the preceding year. [See Sec. 3.5(c).] 
Authority for the discharge of the Secretary's responsibilities is 
delegated by these regulations to the Chief of Protocol.
    (b) The Office of the Chief of Protocol retains primary 
responsibility for administration of the Act within the Department of 
State. That Office will, however, serve as the depository only for those 
foreign gifts and decorations which are turned in by State Department 
employees. The Director of Personnel Services of the USICA will have 
responsibility for administration of the Act within that agency and will 
serve as the depository of foreign gifts and decorations. Employees of 
the other foreign affairs agencies must deposit with their respective 
agencies any gifts

[[Page 12]]

or decorations deposit of which is required by law.
    (c) Any questions concerning the implementation of these regulations 
or interpretation of the law should be directed to the following:
    (1) For the Department of State, to the Office of Protocol or to the 
Office of the Assistant Legal Adviser for Management, as appropriate;
    (2) For IDCA, to the Office of the General Counsel;
    (3) For AID, to the Assistant General Counsel for Employee and 
Public Affairs; and
    (4) For USICA, to the General Counsel.



Sec. 3.6  Procedure to be followed by employees in depositing gifts of more than minimal value and reporting acceptance of travel or travel expenses.

    (a) An employee who has accepted a tangible gift of more than 
minimal value shall, within 60 days after acceptance, relinquish it to 
the designated depository office for the employing agency for disposal 
or, with the approval of that office, deposit it for official use at a 
designated location in the employing agency or at a specified Foreign 
Service post. The designated depository offices are:
    (1) For the Department of State, the Office of Protocol;
    (2) For IDCA, the General Services Division of the Office of 
Management Planning in AID;
    (3) For AID, the General Services Division of the Office of 
Management Planning; and
    (4) For USICA, the Office of Personnel Services.
    (b) At the time that an employee deposits gifts of more than minimal 
value for disposal or for official use pursuant to paragraph (a) of this 
section, or within 30 days after accepting a gift of travel or travel 
expenses as provided in Sec. 3.4(d) (unless the gift of such travel or 
travel expenses has been accepted in accordance with specific 
instructions from the Department or agency), the employee shall file a 
statement with the designated depository office with the following 
information:
    (1) For each tangible gift reported:
    (i) The name and position of the employee;
    (ii) A brief description of the gift and the circumstances 
justifying acceptance;
    (iii) The identity of the foreign government and the name and 
position of the individual who presented the gift;
    (iv) The date of acceptance of the gift;
    (v) The donee's best estimate in specific dollar terms of the value 
of the gift in the United States at the time of acceptance; and
    (vi) Disposition or current location of the gift. (For State 
Department employees, forms for this purpose are available in the Office 
of Protocol.)
    (2) For each gift of travel or travel expenses:
    (i) The name and position of the employee;
    (ii) A brief description of the gift and the circumstances 
justifying acceptance; and
    (iii) The identity of the foregign government and the name and 
position of the individual who presented the gift.
    (c) The information contained in the statements called for in 
paragraph (b) of this section is needed to comply with the statutory 
requirement that, not later than Janaury 31 of each year, the Secretary 
of State publish in the Federal Register a comprehensive listing of all 
such statements filed by Federal employees concerning gifts of more than 
minimal value received by them during the preceding year.



Sec. 3.7  Decorations.

    (a) Decorations tendered in recognition of active field service in 
time of combat operations or awarded for other outstanding or unusually 
meritorious performance may be accepted, retained, and worn by an 
employee, subject to the approval of the employing agency. Without such 
approval, the decoration is deemed to have been accepted on behalf of 
the United States and, like tangible gifts of more than minimal value, 
must be deposited by the employee with the designated depository office 
for the employing agency within sixty days after acceptance, for 
retention for official use or for disposal in accordance with Sec. 3.9.

[[Page 13]]

    (b) The decision as to whether a decoration has been awarded for 
outstanding or unusually meritorious performance will be made:
    (1) For the Department of State, by the supervising Assistant 
Secretary of State or comparable official, except that, in the case of a 
decoration awarded to an Assistant Secretary or other officer of 
comparable or higher rank, the decision shall be made by the Office of 
Protocol;
    (2) For IDCA, by the Assistant Director for Administration;
    (3) For AID, by the Director of Personnel Management; and
    (4) For USICA, by the Supervising Associate Director, the General 
Counsel, or the Director of the Office of Congressional and Public 
Liaison (for domestic employees), and by the Director of Area Offices 
(for overseas employees).
    (c) To justify an affirmative decision, a statement from the foreign 
government, preferably in the form of a citation which shows the 
specific basis for the tender of the award, should be supplied. An 
employee who has received or been tendered a decoration should forward 
to the designated depository office of the employing agency a request 
for review of the case. This request should contain a statement of 
circumstances of the award and such documentation from the foreign 
government as has accompanied it. The depository office will obtain the 
decision of the cognizant office as to whether the award meets the 
statutory criteria and thus whether the decoration may be retained and 
worn. Pending receipt of that decision, the decoration should remain in 
the custody of the recipient.



Sec. 3.8  Approval of retention of gifts or decorations with employing agency for official use.

    (a) At the request of an overseas post or an office within the 
employing agency, a gift or decoration deemed to have been accepted on 
behalf of the United States may be retained for official use. Such 
retention should be approved:
    (1) For the Department of State, by the Chief of Protocol;
    (2) For IDCA, by AID's Director of Management Operations;
    (3) For AID, by the Director of Management Operations; and
    (4) For USICA, by the Associate Director for Management.

However, to qualify for such approval, the gift or decoration should be 
an item which can be used in the normal conduct of agency business, such 
as a rug or a tea service, or an art object meriting display, such as a 
painting or sculpture. Personal gift items, such as wristwatches, 
jewelry, or wearing apparel, should not be regarded as suitable for 
``official use''. Only under unusual circumstances will retention of a 
decoration for official use be authorized. Every effort should be made 
to place each ``official use'' item in a location that will afford the 
largest number of employees, and, if feasible, members of the public, 
the maximum opportunity to receive the benefit of its display, provided 
the security of the location is adequate.
    (b) Items approved for official use must be accounted for and 
safeguarded as Federal property at all times under standard Federal 
property management procedures. Within 30 days after the official use of 
a gift has been terminated, the gift or decoration shall be deposited 
with the designated depository office of the employing agency to be held 
pending completion of disposal arrangements by the General Services 
Administration.



Sec. 3.9  Disposal of gifts and decorations which become the property of the United States.

    (a) Gifts and decorations which have been reported to an employing 
agency shall either be returned to the donor or kept in safe storage 
pending receipt of instructions from the General Services Administration 
for transfer, donation or other disposal under the provisions of the 
Federal Property and Administrative Services Act of 1949, 63 Stat. 377, 
as amended, and the Federal Property Management Regulations (41 CFR part 
101-49). The employing agency shall examine each gift or decoration and 
the circumstances surrounding its donation and assess whether any 
adverse effect upon the foreign relations of the United States might 
result from a return of the gift (or decoration) to the donor, which 
shall be the preferred

[[Page 14]]

means of disposal. If this is not deemed feasible, the employing agency 
is required by GSA regulations to report deposit of the gift or 
decoration within 30 calendar days, using Standard Form 120, Report of 
Excess Personal Property and, as necessary, Standard Form 120A, 
Continuation Sheet, and citing section 7342 of title 5, U.S. Code 
(1976), on the reporting document. Such reports shall be submitted to 
the General Services Administration, Washington National Capital Region 
(WDPO), Attention: Federal Property Resources Service, Seventh and D 
Streets, SW., Washington, DC 20407.
    (b) No gift or decoration deposited with the General Services 
Administration for disposal may be sold without the approval of the 
Secretary of State, upon a determination that the sale will not 
adversely affect the foreign relations of the United States. When 
depositing gifts or decorations with the designated depository office of 
their employing agency, employees may indicate their interest in 
participating in any subsequent sale of the items by the Government. 
Before gifts and decorations may be considered for sale by the General 
Services Administration, however, they must first have been offered for 
transfer to Federal agencies and for donation to the States. 
Consequently, employees should understand that there is no assurance 
that an item will be offered for sale, or, if so offered, that it will 
be feasible for an employee to participate in the sale. Employees are 
reminded in this connection that the primary aim of the Act is to 
discourage employees' acceptance of gifts of more than minimal value.



Sec. 3.10  Enforcement.

    (a) Each employing agency is responsible under the Act for reporting 
to the Attorney General cases in which there is reason to believe that 
one of its employees has violated the Act. The Attorney General in turn 
may file a civil action in any United States District Court against any 
Federal employee who has knowingly solicited or accepted a gift from a 
foreign government in violation of the Act, or who has failed to deposit 
or report such gift, as an Act required by the Act. In such case, the 
court may assess a maximum penality of the retail value of a gift 
improperly solicited or received, plus $5,000.
    (b) Supervisory officials at all levels within employing agencies 
shall be responsible for providing periodic reorientation of all 
employees under their supervision on the basic features of the Act and 
these regulations, and for ensuring that those employees observe the 
requirements for timely reporting and deposit of any gifts of more than 
minimal value they may have accepted.
    (c) Employees are advised of the following actions which may result 
from failure to comply with the requirements of the Act and these 
regulations:
    (1) Any supervisor who has substantial reason to believe that an 
employee under his or her supervision has violated the reporting or 
other compliance provisions of the Act shall report the facts and 
circumstances in writing to the senior official in charge of 
administration within the cognizant bureau or office or at the post 
abroad. If that official upon investigation decides that an employee who 
is the donee of a gift or is the recipient of travel or travel expenses 
has, through actions within the employee's control, failed to comply 
with the procedures established by the Act and these regulations, the 
case shall be referred to the Attorney General for appropriate action.
    (2) In cases of confirmed evidence of a violation, whether or not 
such violation results in the taking of action by the Attorney General, 
the senior administrative official referred to in paragraph (c)(1) of 
this section as responsible for forwarding a violation report to the 
Attorney General shall institute appropriate disciplinary action against 
an employee who has failed to (i) Deposit tangible gifts within 60 days 
after acceptance, (ii) account properly for the acceptance of travel 
expenses or (iii) comply with the Act's requirements respecting disposal 
of gifts and decorations retained for official use.
    (3) In cases where there is confirmed evidence of a violation, but 
no evidence that the violation was willful on the part of the employee, 
the senior administrative official referred to in paragraph (c)(1) of 
this section shall institute appropriate disciplinary action of a lesser 
degree than that called for in

[[Page 15]]

paragraph (c)(2) of this section in order to deter future violations by 
the same or another employee.



Sec. 3.11  Responsibility of chief of mission to inform host government of restrictions on employees' receipt of gifts and decorations.

    A special provision of the Act requires the President to direct 
every chief of a United States diplomatic mission to inform the host 
government that it is a general policy of the United States Government 
to prohibit its employees from receiving gifts of more than minimal 
value or decorations that have not been tendered ``in recognition of 
active field service in time of combat operations or awarded for other 
outstanding or unusually meritorious performance.'' Accordingly, all 
Chiefs of Mission shall in January of each year conduct a thorough and 
explicit program of orientation aimed at appropriate officials of the 
host government concerning the operation of the Act.



Sec. 3.12  Exemption of grants and other foreign government assistance in cultural exchange programs from coverage of foreign gifts and decorations legislation.

    The Act specifically excludes from its application grants and other 
forms of assistance ``to which section 108A of the Mutual Educational 
and Cultural Exchange Act of 1961 applies''. See 22 U.S.C. 2558 (a) and 
(b) for the terms and conditions under which Congress consents to the 
acceptance by a Federal employee of grants and other forms of assistance 
provided by a foreign government to facilitate the participation of such 
employee in a cultural exchange.



PART 3a--ACCEPTANCE OF EMPLOYMENT FROM FOREIGN GOVERNMENTS BY MEMBERS OF THE UNIFORMED SERVICES--Table of Contents




Sec.
3a.1  Definitions.
3a.2  Requirement for approval of foreign government employment.
3a.3  Authority to approve or disapprove proposed foreign government 
          employment.
3a.4  Procedure for requesting approval.
3a.5  Basis for approval or disapproval.
3a.6  Notification of approval.
3a.7  Notification of disapproval and reconsideration.
3a.8  Change in status.

    Authority:  Sec. 509, 91 Stat. 859 (37 U.S.C. 801 Note); sec. 4, as 
amended, 63 Stat. 111 (22 U.S.C. 2658).

    Source:  43 FR 55393, Nov. 28, 1978, unless otherwise noted.



Sec. 3a.1  Definitions.

    For purposes of this part--
    (a) Applicant means any person who requests approval under this part 
to accept any civil employment (and compensation therefor) from a 
foreign government and who is: (1) Any retired member of the uniformed 
services;
    (2) Any member of a Reserve component of the Armed Forces; or
    (3) Any member of the commissioned Reserve Corps of the Public 
Health Service.

The term ``applicant'' also includes persons described in paragraph 
(a)(1), (2), or (3) of this section, who have already accepted foreign 
government employment and are requesting approval under this part to 
continue such employment.
    (b) Uniformed services means the Armed Forces, the commissioned 
Regular and Reserve Corps of the Public Health Service, and the 
commissioned corps of the National Oceanic and Atmospheric 
Administration.
    (c) Armed Forces means the Army, Navy, Air Force, Marine Corps, and 
Coast Guard.
    (d) Secretary concerned means: (1) The Secretary of the Army, with 
respect to retired members of the Army and members of the Army Reserve;
    (2) The Secretary of the Navy, with respect to retired members of 
the Navy and the Marine Corps, members of the Navy and Marine Corps 
Reserves, and retired members of the Coast Guard and members of the 
Coast Guard Reserve when the Coast Guard is operating as a service in 
the Navy;
    (3) The Secretary of the Air Force, with respect to retired members 
of the Air Force and members of the Air Force Reserve;
    (4) The Secretary of Transportation, with respect to retired members 
of the Coast Guard and members of the Coast

[[Page 16]]

Guard Reserve when the Coast Guard is not operating as a service in the 
Navy;
    (5) The Secretary of Commerce, with respect to retired members of 
the commissioned corps of the National Oceanic and Atmospheric 
Administration; and
    (6) The Secretary of Health, Education, and Welfare, with respect to 
retired members of the commissioned Regular Corps of the Public Health 
Service and members of the commissioned Reserve Corps of the Public 
Health Service.



Sec. 3a.2  Requirement for approval of foreign government employment.

    (a) The United States Constitution (Article I, section 9, clause 8) 
prohibits the acceptance of civil employment with a foreign government 
by an officer of the United States without the consent of Congress. 
Congress has consented to the acceptance of civil employment (and 
compensation therefor) by any person described in Sec. 3a.1(b) subject 
to the approval of the Secretary concerned and the Secretary of State 
(37 U.S.C. 801, Note). Civil employment with a foreign government may 
not be accepted without such approval by any person so described.
    (b) The Secretary of State has no authority to approve employment 
with a foreign government by any officer of the United States other than 
a person described in Sec. 3a.1(a). The acceptance of employment with a 
foreign government by any other officer of the United States remains 
subject to the constitutional prohibition described in paragraph (a) of 
this section.
    (c) Any person described in Sec. 3a.1(a) who accepts employment with 
a foreign government without the approval required by this section or 
otherwise obtaining the consent of Congress is subject to forfeiture of 
retired pay to the extent of his or her compensation from the foreign 
government, according to the Comptroller General of the United States 
(44 Comp. Gen. 139 (1964)). This forfeiture is in addition to any other 
penalty which may be imposed under law or regulation.1
---------------------------------------------------------------------------


    1 Approval under this part does not constitute an exception to 
the provisions of the Immigration and Nationality Act concerning loss of 
United States citizenship, for example, by becoming a citizen of or 
taking an oath of allegiance to another country. See 8 U.S.C. 1481 et 
seq.
---------------------------------------------------------------------------



Sec. 3a.3  Authority to approve or disapprove proposed foreign government employment.

    The Director, Bureau of Politico-Military Affairs, is authorized to 
approve or disapprove any request by an applicant for approval under 
this part to accept civil employment (and compensation therefor) from a 
foreign government. The Director may delegate this authority within the 
Bureau of Politico-Military Affairs, Department of State.



Sec. 3a.4  Procedure for requesting approval.

    (a) An applicant must submit a request for approval of foreign 
government employment to the Secretary concerned, whose approval is also 
required by law for the applicant's acceptance of civil employment from 
a foreign government. The request must contain information concerning 
the applicant's status, the nature of the proposed employment in as much 
detail as possible, the identity of and relationship to the foreign 
government concerned, and other matters as may be required by the 
Secretary concerned.
    (b) Requests approved by the Secretary concerned will be referred to 
the Director, Bureau of Politico-Military Affairs, for approval. 
Requests received by the Director, Bureau of Politico-Military Affairs, 
directly from an applicant will be initially forwarded to the Secretary 
concerned, or his designee, for approval of disapproval.



Sec. 3a.5  Basis for approval or disapproval.

    Decisions by the Director, Bureau of Politico-Military Affairs, 
under this part shall be based on whether the applicant's proposed 
employment with a foreign government would adversely affect the foreign 
relations of the United States, in light of the applicant's official 
status as a retiree or reservist.

[[Page 17]]



Sec. 3a.6  Notification of approval.

    The Director, Bureau of Politico-Military Affairs, will notify the 
Secretary concerned when an applicant's proposed foreign government 
employment is approved. Notification of approval to the applicant will 
be made by the Secretary concerned or his designee.



Sec. 3a.7  Notification of disapproval and reconsideration.

    (a) The Director, Bureau of Politico-Military Affairs, will notify 
the applicant directly when an applicant's proposed foreign employment 
is disapproved, and will inform the Secretary concerned.
    (b) Each notification of disapproval under this section must include 
a statement of the reasons for the disapproval, with as much specificity 
as security and foreign policy considerations permit, together with a 
notice of the applicant's right to seek reconsideration of the 
disapproval under paragraph (c) of this section.
    (c) Within 60 days after receipt of the notice of disapproval, an 
applicant whose request has been disapproved may submit a request for 
reconsideration by the Director, Bureau of Politico-Military Affairs. A 
request for reconsideration should provide information relevant to the 
reasons set forth in the notice of disapproval.
    (d) The disapproval of a request by the Director, Bureau of 
Politico-Military Affairs, will be final, unless a timely request for 
reconsideration is received. In the event of a request for 
reconsideration, the Director, Bureau of Politico-Military Affairs, will 
make a final decision after reviewing the record of the request. A final 
decision after reconsideration to approve the applicant's proposed 
employment with a foreign government will be communicated to the 
Secretary concerned as provided in Sec. 3a.6. A final decision after 
reconsideration to disapprove the applicant's proposed employment with a 
foreign government will be communicated directly to the applicant as 
provided in paragraph (a) of this section and the Secretary concerned 
will be informed. The Director's authority to make a final decision 
after reconsideration may not be redelegated.



Sec. 3a.8  Change in status.

    In the event that an applicant's foreign government employment 
approved under this part is to be materially changed, either by a 
substantial change in duties from those described in the request upon 
which the original approval was based, or by a change of employer, the 
applicant must obtain further approval in accordance with this part for 
such changed employment.



PART 4--NOTIFICATION OF FOREIGN OFFICIAL STATUS--Table of Contents




Sec.
4.1  General.
4.2  Procedure.

    Authority:  22 U.S.C. 2651a(a)(4).

    Source:  61 FR 32328, June 24, 1996, unless otherwise noted.



Sec. 4.1  General.

    In accordance with Article 10 of the Vienna Convention on Diplomatic 
Relations and Article 24 of the Vienna Convention on Consular Relations, 
diplomatic missions must notify the Office of Protocol immediately upon 
the arrival, in the United States, of any foreign government officer or 
employee (including domestics and family members), who are serving at 
diplomatic missions, consular posts, or miscellaneous foreign government 
offices. If the employee is already in the United States in some other 
capacity, the notification should be made upon assumption of duties. 
This initial notification requirement also includes all U.S. citizens 
and permanent resident aliens who are employed by foreign missions.



Sec. 4.2  Procedure.

    Notification and subsequent changes are made as follows:
    (a) Diplomatic and career consular officers and their dependents: 
Form DSP-110, Notification of Appointment of Foreign Diplomatic Officer 
and Career Consular Officer;
    (b) All other foreign government employees who are serving at 
diplomatic missions, consular posts, or miscellaneous foreign government 
offices and

[[Page 18]]

their dependents: Form DSP-111, Notification of Appointment of Foreign 
Government Employee.
    (c) Honorary consular officers: Form DSP-112, Notification of 
Appointment of Honorary Consular Officer.
    (d) Missions should use Form DSP-113, Notification of Change--
Identification Card Request, to promptly inform the Department of State 
of any change in the status of officers or employees of the missions and 
their family members originally reported to Protocol, or to apply for an 
identification card.
    (e) Upon termination of employment of any diplomatic or consular 
officer, honorary consular officer, embassy or consular employee, or 
miscellaneous foreign government staff member, a Form DSP-115, Notice of 
Termination of Diplomatic, Consular, or Foreign Government Employment, 
must be submitted to the Office of Protocol.



PART 5--ORGANIZATION--Table of Contents




Sec.
5.1  Introduction.
5.2  Central and field organization, established places at which, the 
          officers from whom, and the methods whereby the public may 
          secure information, make submittals, or request, or obtain 
          decisions; and statements of the general course and method by 
          which its functions are channeled and determined.
5.3  Rules of procedure, description of forms available or the places at 
          which forms may be obtained, and instructions as to the scope 
          and content of all papers, reports, or examinations.
5.4  Substantive rules of general applicability adopted as authorized by 
          law, and statements of general policy or interpretation of 
          general applicability formulated and adopted by the agency.

    Authority:  Sec. 4, 63 Stat. 111, as amended, sec. 501, 65 Stat. 
290; 22 U.S.C. 2658, 31 U.S.C. 483a, 5 U.S.C. 552, E.O. 10501; 18 FR 
7049; 3 CFR, 1949-1953 Comp., page 979.

    Source:  33 FR 7078, May 11, 1968, unless otherwise noted.



Sec. 5.1  Introduction.

    The sections in this part 5 are issued pursuant to section 3 of the 
Administrative Procedure Act, 5 U.S.C. 552, effective July 4, 1967.



Sec. 5.2  Central and field organization, established places at which, the officers from whom, and the methods whereby the public may secure information, make 

          submittals, or request, or obtain decisions; and statements of 
          the general course and method by which its functions are 
          channeled and determined.

    (a) The following statements of the central and field organization 
of the Department of State and its Foreign Service posts are hereby 
prescribed:
    (1) The central organization of the Department of State was issued 
as Public Notice No. 267, 32 FR 8923, June 22, 1967.
    (2) The foreign field organization of the Department of State was 
issued as Public Notice No. 254, 32 FR 3712, March 3, 1967.
    (3) The domestic field organization of the Department of State was 
issued as Public Notice No. 268, 32 FR 8925, June 22, 1967.
    (b) As used in the following sections, the term ``Department of 
State'' includes all offices within the Department in Washington, its 
domestic field offices in the United States, all Foreign Service posts 
throughout the world, and U.S. missions to international organizations 
unless otherwise specified.
    (c) Any person desiring information concerning a matter handled by 
the Department of State, or any person desiring to make a submittal or 
request in connection with such a matter, should communicate either 
orally or in writing with the appropriate office. If the office 
receiving the communication does not have jurisdiction to handle the 
matter, the communication, if written, will be forwarded to the proper 
office, or, if oral, the person will be advised how to proceed. When the 
submittal or request consists of a formal application for one of the 
documents, privileges, or other benefits provided for in the laws 
administered by the Department of State, or in the regulations 
implementing these laws, the instructions on the form as to preparation 
and place of submission should be followed. In such cases, the 
provisions of this part referring to the particular regulation concerned 
should be consulted.

[[Page 19]]



Sec. 5.3  Rules of procedure, description of forms available or the places at which forms may be obtained, and instructions as to the scope and content of all 
          papers, reports, or examinations.

    Rules of procedure regarding the following listed matters may be 
consulted under the corresponding regulations referenced in Sec. 5.4, or 
obtained upon application to the offices listed below. Forms pertaining 
to the following listed matters, and instructions relating thereto may 
also be obtained at the offices indicated below:

                                                                                                                
----------------------------------------------------------------------------------------------------------------
              Subject matter                          Office                             Address                
----------------------------------------------------------------------------------------------------------------
Appointment of Foreign Service Officers..  Board of Examiners for the   Department of State, Room 7314, 1800 N. 
                                            Foreign Service.             Kent St., Arlington, Va. 22209.        
Authentication and other services........  Document and Reference       Department of State, Room 2815, 22d and 
                                            Division.                    D Sts. NW., Washington, DC 20520.      
Claims and stolen property...............  Legal Adviser..............  Department of State, 2201 C Street NW., 
                                                                         Washington, DC 20520.                  
International educational and cultural     Bureau of Educational and    Department of State, 2201 C Street NW., 
 exchange program.                          Cultural Affairs.            Washington, DC 20520.                  
International traffic in arms............  Office of Munitions Control  Department of State, Room 800, 1700 N.  
                                                                         Lynn St., Arlington, Va. 22209.        
Nationality and passports................  Passport Office............  Department of State, Room 362, 1425 K   
                                                                         St., NW., Washington, DC 20524.        
Protection and welfare of U.S. citizens,   Office of Special Consular   Department of State, 2201 C Street NW., 
 shipping and seamen, and other consular    Services.                    Washington, DC 20520.                  
 services abroad.                                                                                               
Visa issuance............................  Visa Office................  Department of State, Annex 2, 515 22d   
                                                                         Street NW., Washington, DC 20520.      
----------------------------------------------------------------------------------------------------------------



Sec. 5.4  Substantive rules of general applicability adopted as authorized by law, and statements of general policy or interpretation of general applicability 
          formulated and adopted by the agency.

    (a) The regulations of the Department of State required to be 
published under the provisions of the Administrative Procedure Act are 
found in the Code of Federal Regulations and the Federal Register. Any 
person desiring information with respect to a particular procedure 
should examine the pertinent regulation cited hereafter.
    (b) The following are citations to regulations within the scope of 
this section.

    (1) Acceptance of Gifts and Decorations from Foreign Governments. 22 
CFR part 3 et seq.
    (2) Employee Responsibility and Conduct. 22 CFR part 10 et seq.
    (3) Appointment of Foreign Service Officers. 22 CFR part 11 et seq.
    (4) Fees for Services in the United States, fees and Charges, 
Foreign service. 22 CFR part 21 et seq.; 22 CFR part 22 et seq.
    (5) Claims and Stolen Property. 22 CFR part 31 et seq.
    (6) Issuance of Visas. 22 CFR parts 41-42 et seq.
    (7) Nationality and Passports. 22 CFR part 50 et seq.
    (8) International Educational and Cultural Exchanges. 22 CFR part 61 
et seq.
    (9) Protection and Welfare of Americans Abroad. 22 CFR part 71 et 
seq.
    (10) Shipping and Seamen Abroad. 22 CFR part 81 et seq.
    (11) Other Consular Services Abroad. 22 CFR part 91 et seq.
    (12) Economic, Commercial and Civil Air Functions Abroad. 22 CFR 
part 101 et seq.
    (13) International Traffic in Arms. 22 CFR part 121 et seq.
    (14) Certificates of Authentication. 22 CFR part 131 et seq.
    (15) Civil Rights. 22 CFR part 141 et seq.
    (16) Department of State Procurement. 41 CFR part 6-1 et seq.

    (c) These regulations are supplemented from time to time by 
amendments appearing initially in the Federal Register.



PART 7--BOARD OF APPELLATE REVIEW--Table of Contents




Sec.
7.1  Definitions.
7.2  Establishment of Board of Appellate Review; purpose.
7.3  Jurisdiction.
7.4  Membership and organization.
7.5  Procedures.
7.6  Hearings.
7.7  Passport cases.
7.8  South African Fair Labor Standards cases.

[[Page 20]]

7.9  Decisions.
7.10  Motion for reconsideration.
7.11  Computation of time.
7.12  Attorneys.

    Authority:  Sec. 1, 44 Stat. 887, sec. 4, 63 Stat. 111, as amended, 
22 U.S.C. 211a, 2658; secs. 104, 360, 66 Stat. 174, 273, 8 U.S.C. 1104, 
1503; E.O. 11295, 36 FR 10603; 3 CFR 1966-1970 Comp., page 507; 22 CFR 
60-65; E.O. 12532, 50 FR 36861 7.4 also issued under 22 U.S.C. 3926.

    Source:  44 FR 68825, Nov. 30, 1979, unless otherwise noted.



Sec. 7.1  Definitions.

    (a) Board means the Board of Appellate Review or the panel of three 
members considering an appeal.
    (b) Department means the Department of State.
    (c) Party means the appellant or the Department of State.



Sec. 7.2  Establishment of Board of Appellate Review; purpose.

    (a) There is hereby established the Board of Appellate Review of the 
Department of State to consider and determine appeals within the purview 
of Sec. 7.3. The Board shall take any action it considers appropriate 
and necessary to the disposition of cases appealed to it.
    (b) For administrative purposes, the Board shall be part of the 
Office of the Legal Adviser. The merits of appeals or decisions of the 
Board shall not be subject to review by the Legal Adviser or any other 
Department official, except that the Department may administratively 
vacate a Certificate of Loss of Nationality on its own initiative at any 
time, notwithstanding an intervening decision by the Board sustaining 
the Department's original determination.
[44 FR 68825, Nov. 30, 1979, as amended at 56 FR 55457, Oct. 28, 1991]



Sec. 7.3  Jurisdiction.

    The jurisdiction of the Board shall include appeals from decisions 
in the following cases:
    (a) Appeals from administrative determinations of loss of 
nationality or expatriation under subpart C of part 50 of this chapter.
    (b) Appeals from administrative decisions denying, revoking, 
restricting or invalidating a passport under Secs. 51.70 and 51.71 of 
this chapter.
    (c) Appeals from final decisions of contracting officers arising 
under contracts or grants of the Department of State, not otherwise 
provided for in the Department of State contract appeal regulations 
(part 6-60 of title 41).
    (d) Appeals from administrative determinations under Sec. 64.1(a) of 
this chapter, denying U.S. Government assistance to U.S. nationals who 
do not comply with the Fair Labor Standards in Sec. 61.2 of this 
chapter.
    (e) Appeals from administrative decisions of the Department of State 
in such other cases and under such terms of reference as the Secretary 
of State may authorize.
[44 FR 68825, Nov. 30, 1979, as amended at 51 FR 15319, Apr. 23, 1986]



Sec. 7.4  Membership and organization.

    (a) Membership. The Board shall consist of regular and ad hoc 
members as the Legal Adviser may designate. Regular members shall serve 
on a fulltime basis. Ad hoc members may be designated from among senior 
officers of the Department of State or from among persons not employed 
by the Department. Regular and ad hoc members shall be attorneys in good 
standing admitted to practice in any State of the United States, the 
District of Columbia, or any Territory or possession of the United 
States.
    (b) Chairperson. The Legal Adviser shall designate a regular member 
of the Board as chairperson. A member designated by the chairperson 
shall act in the absence of the chairperson. The chairperson or designee 
shall preside at all proceedings before the Board, regulate the conduct 
of such proceedings, and pass on all issues relating thereto.
    (c) Composition. In considering an appeal, the Board shall act 
through a panel of three members, not more than two of whom shall be ad 
hoc members.
    (d) Rules of procedure. The Board may adopt and promulgate rules of 
procedure approved by the Secretary of State as may be necessary to 
govern its proceedings.

(22 U.S.C. 2658 and 3926)
[44 FR 68825, Nov. 30, 1979, as amended at 49 FR 16989, Apr. 23, 1984]

[[Page 21]]



Sec. 7.5  Procedures.

    (a) Filing of appeal. A person who has been the subject of an 
adverse decision in a case falling within the purview of Sec. 7.3 shall 
be entitled upon written request made within the prescribed time to 
appeal the decision to the Board. The appeal shall be in writing and 
shall state with particularity reasons for the appeal. The appeal may by 
accompanied by a legal brief. An appeal filed after the prescribed time 
shall be denied unless the Board determines for good cause shown that 
the appeal could not have been filed within the prescribed time.
    (b) Time limit on appeal. (1) A person who contends that the 
Department's administrative determination of loss of nationality or 
expatriation under subpart C of part 50 of this chapter is contrary to 
law or fact, shall be entitled to appeal such determination to the Board 
upon written request made within one year after approval by the 
Department of the certificate of loss of nationality or a certificate of 
expatriation.
    (2) A person who has been subject of an adverse decision under 
Sec. 51.89, of this Chapter shall be entitled to appeal the decision to 
the Board upon written request made within 60 days after receipt of 
notice of such decision.
    (3) A national who has been subject of an adverse decision under 
Sec. 64.1(a) of this chapter shall be entitled to appeal the decision to 
the Board within 30 days after receipt of notice of such decision.
    (4) Time limits for other appeals shall be established by the Board 
as appropriate.
    (c) Department case record. Upon the written request of the Board, 
the office or bureau in the Department of State responsible for the 
decision from which the appeal was taken shall assemble and transmit to 
the Board within 45 days the record on which the Department's decision 
in the case was based. The case record may be accompanied by a 
memorandum setting forth the position of the Department on the case.
    (d) Briefs. Briefs in support of or in opposition to an appeal shall 
be submitted in triplicate to the Board. The appellant shall submit his 
or her brief within 60 days after filing of the appeal. The Department 
shall then file a brief within 60 days after receipt of a copy of 
appellant's brief. Reply briefs, if any, shall be filed within 30 days 
after the date the Department's brief is filed with the Board. Extension 
of time for submission of a reply brief may be granted by the Board for 
good cause shown. Posthearing briefs may be submitted upon such terms as 
may be agreed to by the parties and the presiding member of the Board at 
the conclusion of a hearing.
    (e) Hearing. An appellant shall be entitled to a hearing upon 
written request to the Board. An appellant may elect to waive a hearing 
and submit his or her appeal for decision on the basis of the record 
before the Board.
    (f) Pre-hearing conference. Whether there is a hearing before the 
Board on an appeal or whether an appeal is submitted for decision on the 
record without a hearing the Board may call upon the parties to appear 
before a member of the Board for a conference to consider the 
simplification or clarification of issues and other matters as may aid 
in the disposition of the appeal. The results of the conference shall be 
reduced to writing by the presiding Board member, and this writing shall 
constitute a part of the record.
    (g) Admissibility of evidence. Except as otherwise provided in 
Sec. 7.7 and Sec. 7.8, the parties may introduce such evidence as the 
Board deems proper. Formal rules of evidence shall not apply, but 
reasonable restrictions shall be imposed as to the relevancy, competency 
and materiality of evidence presented.
    (h) Depositions. The Board may, upon the written request of either 
party or upon agreement by the parties, permit the taking of the 
testimony of any person by deposition upon oral examination or written 
interrogatories for use as evidence in the appeal proceedings. The 
deponent shall be subject to cross-examination either by oral 
examination or by written interrogatories by the opposing party or by 
the Board. Leave to take a deposition shall not be granted unless it 
appears impracticable to require the deponent's testimony at the hearing 
on the appeal, or unless the taking of a deposition is deemed to be 
warranted for other valid reasons.

[[Page 22]]

    (i) Record of proceedings. The record of proceedings before the 
Board shall consist of the Department's case record, briefs and other 
written submissions of the parties, the stipulation of facts, if any, 
the evidence admitted, and the transcript of the hearing if there is a 
hearing. The record shall be available for inspection by the parties at 
the Office of the Board.
    (j) Scope of review. Except as otherwise provided in Secs. 7.7 and 
7.8, the Board shall review the record in the case before it. The Board 
shall not consider argument challenging the constitutionality of any law 
or of any regulation of the Department of State or take into 
consideration any classified or administratively controlled material.
    (k) Appearance before the Board. Any party to any proceeding before 
the Board is entitled to appear in person or by or with his or her 
attorney, who must possess the requisite qualifications, set forth in 
Sec. 7.12, to practice before the Board.
    (l) Failure to prosecute an appeal. Whenever the record discloses 
the failure of an appellant to file documents required by these 
regulations, respond to notices or correspondence from the Board, or 
otherwise indicates an intention not to continue the prosecution of an 
appeal, the Board may in its discretion terminate the proceedings 
without prejudice to the later reinstatement of the appeal for good 
cause shown.
[44 FR 68825, Nov. 30, 1979, as amended at 51 FR 15319, Apr. 23, 1986; 
52 FR 41560, Oct. 29, 1987]



Sec. 7.6  Hearings.

    (a) Notice and place of hearing. The parties shall be given at least 
15 days notice in writing of the scheduled date and place of a hearing 
on an appeal. The Board shall have final authority to fix or change any 
hearing date giving consideration to the convenience of the parties. 
Hearings shall be held at the Department of State, Washington, DC, 
unless the Board determines otherwise.
    (b) Conduct of hearing. The appellant may appear and testify on his 
own behalf. The parties may present witnesses, offer evidence and make 
argument. The appellant and witnesses may be examined by any member of 
the Board, by the Department, and by the appellant's attorney, if any. 
If any witness whom the appellant or the Department wishes to call is 
unable to appear personally, the Board in its discretion, may accept an 
affidavit by the witness or grant leave to take the deposition of such 
witness. Any such witness will be subject to cross examination by means 
of sworn responses to interrogatories posed by the opposing party. The 
appellant and the Department shall be entitled to be informed of all 
evidence before the Board and of the source of such evidence, and to 
confront and cross-examine any adverse witness. The Board may require a 
stipulation of facts prior to or at the beginning of the hearing and may 
require supplemental statements on issues presented to it, or 
confirmation, verification or authentication of any evidence submitted 
by the parties. The parties shall be entitled to reasonable continuances 
upon request for good cause shown.
    (c) Privacy of hearing. The hearing shall be private unless an 
appellant requests in writing that the hearing be open to the public. 
Attendance at the hearing shall be limited to the appellant, attorneys 
of the parties, the members of the Board, Department personnel who are 
directly involved in the presentation of the case, official 
stenographers, and the witnesses. Witnesses shall be present at the 
hearing only while they are giving testimony or when otherwise directed 
by the Board.
    (d) Transcript of hearing. A complete verbatim transcript shall be 
made of the hearing by a qualified reporter, and the transcript shall 
constitute a permanent part of the record. Upon request, the appellant 
shall have the right to inspect the complete transcript and to purchase 
a copy thereof.
    (e) Nonappearance of a party. The unexcused absence of a party at 
the time and place set for a hearing shall not be occasion for delay. In 
the event of such absence, the case will be regarded as having been 
submitted by the absent party on the record before the Board.
[44 FR 68825, Nov. 30, 1979, as amended at 53 FR 39589, Oct. 11, 1988]

[[Page 23]]



Sec. 7.7  Passport cases.

    (a) Scope of review. With respect to appeals taken from decisions of 
the Assistant Secretary for Consular Affairs denying, revoking, 
restricting, or invalidating a passport under Secs. 51.70 and 51.71 of 
this chapter, the Board's review, except as provided in paragraph (b) of 
this section, shall be limited to the record on which the Assistant 
Secretary's decision was based.
    (b) Admissibility of evidence. The Board shall not receive or 
consider evidence or testimony not presented at the hearing held under 
Secs. 51.81-51.89 of this chapter unless it is satisfied that such 
evidence or testimony was not available or could not have been 
discovered by the exercise of reasonable diligence prior to such 
hearing.
[44 FR 68825, Nov. 30, 1979, as amended at 53 FR 39589, Oct. 11, 1988]



Sec. 7.8  South African Fair Labor Standards cases.

    (a) Scope of review. With respect to appeals taken from decisions of 
the Assistant Secretary for African Affairs denying assistance to U.S. 
nationals operating in South Africa which do not comply with the Fair 
Labor Standards outlined in Sec. 61.2 of the chapter, the Board's review 
except as provided in paragraph (b) of this section shall be limited to 
the record on which the Assistant Secretary's decision was based.
    (b) Admissibility of evidence. The Board shall not receive or 
consider evidence or testimony not presented pursuant to Sec. 63.3(a) or 
Sec. 63.3(b) of this chapter unless it is satisfied that such evidence 
was not available or could not have been discovered by the exercise of 
reasonable diligence prior to entry of the decision of the Assistant 
Secretary for African Affairs.
[51 FR 15319, Apr. 23, 1986, as amended at 52 FR 41560, Oct. 29, 1987; 
53 FR 39589, Oct. 11, 1988]



Sec. 7.9  Decisions.

    The Board shall decide the appeal on the basis of the record of the 
proceedings. The decision shall be by majority vote in writing and shall 
include findings of fact and conclusions of law on which it is based. 
The decision of the Board shall be final, subject to Secs. 7.2(b) and 
7.10. Copies of the Board's decision shall be forwarded promptly to the 
parties.
[56 FR 55457, Oct. 28, 1991]



Sec. 7.10  Motion for reconsideration.

    The Board may entertain a motion for reconsideration of a Board's 
decision, if filed by either party. The motion shall state with 
particularity the grounds for the motion, including any facts or points 
of law which the filing party claims the Board has overlooked or 
misapprehended, and shall be filed within 30 days from the date of 
receipt of a copy of the decision of the Board by the party filing the 
motion. Oral argument on the motion shall not be permitted. However, the 
party in opposition to the motion will be given opportunity to file a 
memorandum in opposition to the motion within 30 days of the date the 
Board forwards a copy of the motion to the party in opposition. If the 
motion to reconsider is granted, the Board shall review the record, and, 
upon such further reconsideration, shall affirm, modify, or reverse the 
original decision of the Board in the case.
[44 FR 68825, Nov. 30, 1979. Redesignated at 51 FR 15319, Apr. 23, 1986]



Sec. 7.11  Computation of time.

    In computing the period of time for taking any action under this 
part, the day of the act, event, or notice from which the specified 
period of time begins to run shall not be included. The last day of the 
period shall be included, unless it falls on a Saturday, Sunday, or a 
legal holiday, in which event the period shall extend to the end of the 
next day which is not a Saturday, Sunday, or a legal holiday. The Board 
for good cause shown may in its discretion enlarge the time prescribed 
by this part for the taking of any action.
[44 FR 68825, Nov. 30, 1979. Redesignated at 51 FR 15319, Apr. 23, 1986]



Sec. 7.12  Attorneys.

    (a) Attorneys at law who are admitted to practice in any State of 
the United States, the District of Columbia, or any Territory or 
possession of the United States, and who are members of the Bar in good 
standing, may

[[Page 24]]

practice before the Board unless disqualified under paragraph (b) of 
this section or for some other valid reason.
    (b) No attorney shall be permitted to appear before the Board as 
attorney representing an appellant if he or she is subject to the 
conflict of interest provisions of chapter 11 of title 18 of the United 
States Code.
[44 FR 68825, Nov. 30, 1979. Redesignated at 51 FR 15319, Apr. 23, 1986]



PART 8--ADVISORY COMMITTEE MANAGEMENT--Table of Contents




Sec.
8.1  Authorities.
8.2  Policy.
8.3  Scope.
8.4  Definitions.
8.5  Creation of a committee.
8.6  Membership.
8.7  Security.
8.8  Chartering of committees.
8.9  Meetings of advisory committees.
8.10  Reports.
8.11  Records.
8.12  Financial records.
8.13  Availability of records.
8.14  Public inquiries.

    Authority:  22 U.S.C. 2658; sec. 8(a) Federal Advisory Committee Act 
(Pub. L. 92-463); E.O. 11769; and OMB Circular A-63, Rev.

    Source:  40 FR 28606, July 8, 1975, unless otherwise noted.



Sec. 8.1  Authorities.

    (a) Regulatory authorities. (1) These regulations are issued to 
implement the Federal Advisory Committee Act, Pub. L. 92-463, which 
became effective January 5, 1973, and Office of Management and Budget 
Circular No. A-63 of March 27, 1974. These regulations also are in 
accordance with Executive Order 11769 of February 21, 1974, and the 
responsibilities of the Secretary of State under 22 U.S.C. 2656.
    (2) These regulations apply to any advisory committee which provides 
advice to the Department of State or any officer of the Department. 
However, to the extent that an advisory committee is subject to 
particular statutory provisions, which are inconsistent with the Federal 
Advisory Committee Act, these regulations do not apply.
    (b) Delegated authority. (1) The Deputy Under Secretary for 
Management has been designated by the Secretary (Delegation of Authority 
No. 125 signed November 7, 1972) to have full responsibility for the 
Committee Management function.
    (2) The Advisory Committee Management Officer in the Management 
Systems Staff administers the Committee Management Program for the 
Deputy Under Secretary for Management.



Sec. 8.2  Policy.

    (a) Advisory Committees are to be used for obtaining advice and 
recommendations on matters for which they were established, and may be 
utilized only when the information sought is not otherwise efficiently 
and economically available.
    (b) Unless provided otherwise by statute or Presidential directive, 
advisory committees shall be utilized solely for advisory functions and 
any decision taken pursuant to the advice or recommendation of an 
advisory committee is the responsibility of the appropriate Department 
officer. For the purposes of this provision, ``Presidential directive'' 
includes an executive order or executive memorandum.
    (c) Meetings of advisory committees will be open to the public 
unless there is a compelling reason which requires nondisclosure of the 
subject matter in accordance with public law (5 U.S.C. 552 (b)).



Sec. 8.3  Scope.

    (a) The Federal Advisory Committee Act applies to committees 
``established'' by the Government and to committees ``utilized'' though 
not established by the Government.
    (1) The President and the Congress, or the Department in 
consultation with the Office of Management and Budget, may establish a 
group which shall be known as an advisory committee for the purpose of 
obtaining advice or recommendations and which shall be subject to the 
Federal Advisory Committee Act throughout its existence.
    (2) Though not established by the President or the Department, a 
group utilized for the purpose of obtaining advice or recommendations 
must file a charter prior to a meeting, and otherwise conform to the 
requirements of the Act during any meetings or other contacts with the 
Department.

[[Page 25]]

    (b) One requisite for coverage of either type (established or 
utilized) under the Federal Advisory Committee Act is that the group can 
be defined as a committee as set forth in the definition of a committee, 
as contained in Sec. 8.4 of these regulations, and have all or most of 
the following characteristics:
    (1) The purpose, objective or intent is that of providing advice to 
any officer or organizational component of the Department;
    (2) Has regular or periodic meetings;
    (3) Has fixed membership (membership may include more than one full 
time Federal officer or employee but is not comprised wholly of 
Government personnel);
    (4) Has an organizational structure (e.g., officers) and a staff.
    (c) Where a group provides some advice to an agency, but the group's 
advisory function is incidental to and inseparable from other 
operational functions such as making or implementing decisions, the 
Federal Advisory Committee Act does not apply.
    (d) Where the advisory function of a group is separable from its 
operational function, the group is subject to the Act to the extent that 
it operates as an advisory committee.



Sec. 8.4  Definitions.

    (a) The Federal Advisory Committee Act defines advisory committee as 
any committee, board, commission, council, conference, panel, task 
force, or other similar group, or any subcommittee or other subgroup 
thereof, which is--
    (1) Established by statute or reorganization plan, or
    (2) Established or utilized by the President, or
    (3) Established or utilized by one or more agencies, in the interest 
of obtaining advice or recommendations for the President or one or more 
agencies or officers of the Federal Government, except a committee 
composed wholly of full-time officers and employees of the Government.
    (b) A formal subgroup or subcommittee independently possesses 
significant requisites of an advisory committee, i.e., fixed membership, 
periodic meetings, et cetera.
    (c) An informal subgroup or subcommittee is one that facilitates the 
activities of its advisory committee. For example, during a particular 
meeting, the advisory committee may divide itself into subgroups to 
permit simultaneous discussion of different topics.



Sec. 8.5  Creation of a committee.

    (a) A bureau or an office designated or desiring to sponsor an 
advisory committee will prepare a memorandum to the Advisory Committee 
Management Officer setting forth the purpose, organization (including 
subgroups), proposed balanced membership (see Sec. 8.6), and a 
justification for the need of the particular committee.
    (b) The Advisory Committee Management Officer will review the 
request and will make an action recommendation to the Deputy Under 
Secretary for Management through the Director of the Management Systems 
Staff.
    (c) If the Deputy Under Secretary for Management approves the 
request, it will be submitted to the Committee Management Secretariat of 
the Office of Management and Budget for approval. The OMB Secretariat 
will usually take action within 15 days.
    (d) The Advisory Committee Management Officer will advise the 
sponsoring bureau or office of the approval for or rejection of the 
request to establish the advisory committee.
    (e) After OMB approval the intent to establish an advisory 
committee, containing a description of the committee and a statement of 
why it is in the public interest to create it, will be published in the 
Federal Register at least 15 days prior to filing the committee charter.



Sec. 8.6  Membership.

    (a) The act requires a balanced membership in terms of the points of 
view represented. Members are selected for their expertise in the 
committee's functions and should be chosen from different vocations 
having knowledge in the subject.
    (b) It is Department policy that members will be selected without 
regard to national origin, religion, race, sex, or color.

[[Page 26]]

    (c) The committee office will keep the Advisory Committee Management 
Officer currently advised of a committee's membership including 
vacancies.



Sec. 8.7  Security.

    (a) All officers and members of a committee must have a security 
clearance for the subject matter level of security at which the 
committee functions.
    (b) The responsible committee office will provide the Advisory 
Committee Management Officer with each member's security clearance level 
and date of issue.
    (c) The substantive office sponsoring an advisory committee is 
responsible for access to and removal from official premises of 
classified material in accordance with the Department's security 
regulations (5 FAM 940 and 973). Any questions arising involving 
security procedures are to be presented to the Office of Security for 
guidance and resolution.



Sec. 8.8  Chartering of committees.

    (a) Requirements. (1) Each advisory committee, whether established 
or utilized, must have a charter approved by the Deputy Under Secretary 
of State for Management and filed with the Advisory Committee Management 
Officer, the Senate Foreign Relations Committee and the House Committee 
on International Relations, and in the case of a Presidential advisory 
committee only with the Committee Management Secretariat of OMB before 
it can hold a meeting.
    (2) Formal subgroups may be chartered separately or the requisite 
information set forth in the charter of the parent committee.
    (3) Informal subgroups may not require a charter; however, the 
charter of the parent committee must cover this aspect of its 
organization.
    (4) The Advisory Committee Management Officer will, at the time a 
charter is filed, furnish a copy of the filed charter to the Library of 
Congress.
    (b) Contents. Each committee charter shall contain: The official 
name and acronym, if any; the objectives, scope of activity, and full 
description of duties; the authority for such functions; the Department 
official (by title) to whom the committee reports; the relationship to 
or with other committees; the committee organization, composition of 
membership and officers' responsibilities; a description of the type of 
minutes, with their certification of accuracy, and records to be 
maintained; the estimated annual operating costs in dollars and man-
years, and the source and authority for these resources; the period of 
time that will be required by the committee to accomplish its stated 
purpose; the estimated number and frequency of meetings; the termination 
date; and the filing date of the charter.
    (c) Termination and Renewal. (1) An existing advisory committee will 
be automatically terminated at the end of a 2-year period (i.e., date 
specified in charter) unless its charter is renewed, except for a 
statutory committee which has provisions providing to the contrary.
    (2) The Deputy Under Secretary for Management will make a 
determination, based on a comprehensive review, whether or not a 
committee will be continued.
    (3) The OMB Secretariat will be advised of the determination and 
reasons therefore 60 days prior to the charter expiration date of the 
committee. If the Secretariat concurs, the Advisory Committee Management 
Officer will publish in the Federal Register the Department's intent to 
continue those advisory committees so designated by the Deputy Under 
Secretary for Management.
    (4) Each office responsible for an advisory committee it wishes to 
continue will prepare a new charter and submit it to the Advisory 
Committee Management Officer before October 1 biennially.
    (5) No advisory committee shall meet, advise or make recommendations 
between the expiration date of its charter and the date its new charter 
is filed.
    (d) Amendments. (1) The charter of a committee may be amended, as 
necessary, to reflect current information on organization, composition, 
activities, et cetera.

[[Page 27]]

    (2) A proposed amendment must be approved prior to any committee 
activity to which the proposed amendment relates.



Sec. 8.9  Meetings of advisory committees.

    (a) Applicability. The term ``meeting'' covers any situation in 
which all or some of the members of an advisory committee convene with a 
representative of the Department to transact committee business or to 
discuss matters related to the committee. This is applicable to an 
advisory committee and to its subordinate components.
    (b) Designated Department Official. (1) No advisory committee may 
hold a meeting in the absence of the designated full-time Department or 
other U.S. Government officer.
    (2) The designated Department or other U.S. Government officer has 
the following responsibilities:
    (i) Prepares or approves the agenda for all meetings;
    (ii) Calls or approves in advance the calling of the meetings;
    (iii) Adjourns any meeting whenever he or she determines that 
adjournment is in the public interest.
    (c) Notice of Meetings. (1) All advisory committee meetings, open or 
closed, will be publicly announced except when the President of the 
United States determines otherwise for reasons of national security.
    (2) Notice of each such meeting shall be published in the Federal 
Register and in a Department of State Press Release at least 15 days 
prior to the meeting date.
    (3) The responsible committee office will prepare the notice and 
press release, obtaining clearances as set forth in paragraphs (c)(3) 
(i) and (ii) of this section, and deliver to the Advisory Committee 
Management Officer for action:
    (i) Open meeting--clearance within initiating office/bureau;
    (ii) Closed meeting--clearance within initiating office/bureau 
including its legal adviser, and the Bureau of Public Affairs at the 
Bureau level.
    (4) The Deputy Under Secretary for Management will determine if an 
advisory committee may hold a closed meeting, after a request for a 
meeting not open to the public is cleared by the Advisory Committee 
Management Officer and the Office of the Legal Adviser.
    (5) After the clearances set forth in paragraphs (c) (3) and (4) of 
this section, a notification of meeting may also be provided by the 
office/bureau to any persons or organizations known to be interested in 
the activities of the committee.
    (6) The office sponsoring the committee is responsible for meeting 
publishing date requirements. Overall normal processing time prior to a 
meeting date is 25 days for an open meeting and 47 days for a closed 
meeting.
    (d) Contents of Notice. (1) The content of the Federal Register 
public notice and the Department of State press release will be 
identical.
    (2) An open meeting announcement will state the name of the 
committee; the date, time, and place of the meeting; the agenda or 
summary thereof; that the meeting will be open to the public; the extent 
to which the public may participate in the meeting, either orally or in 
writing; seating space available; and the name and telephone number of a 
committee officer to whom inquiries may be directed, including 
arrangments for those attending if the meeting is in a secure building.
    (3) A closed meeting announcement will state the name of the 
committee, the date of meeting and the reason or reasons which justify 
the closing of the meeting in the public interest.
    (e) Closed Meetings. (1) An advisory committee meeting may be closed 
in accordance with the Federal Advisory Committee Act when the President 
or Department determines that the meeting is concerned with matters 
listed in section 552(b) of title 5, United States Code.
    (2) Any determination to close all or a part of a meeting must be 
based upon specific reasons. If a meeting is to cover separable matters, 
not all of which are within the exemptions of 5 U.S.C. 552(b), only the 
portion of the meeting dealing with exempt matters may be closed.
    (3) When a meeting or portion of a meeting is to be closed to the 
public, the notice should state the reasons for the closing.

[[Page 28]]

    (4) The written request in accordance with paragraph (c)(4) of this 
section, for a determination by the Deputy Under Secretary for 
Management that a committee may hold a closed meeting must be submitted 
at least 47 days before the scheduled date of the meeting unless the 
Deputy Under Secretary for Management determines that a shorter period 
of time is necessary.
    (f) Cancelled Meetings. (1) The cancellation of a scheduled 
committee meeting must be publicized without delay.
    (2) The responsible committee office will prepare a public notice 
and press release and hand-carry them to the Advisory Committee 
Management Officer as soon as the decision to cancel the meeting is 
made.
    (3) The notice and press release will state the name of the advisory 
committee, identify the meeting that is cancelled, and state why it is 
cancelled. The Federal Register data, if known, concerning the 
announcement should be cited.
    (g) Rescheduled Meetings. When it is not feasible to hold an 
advisory committee meeting on the date that has been announced such 
meeting may be rescheduled for a later date by utilizing the same 
procedure as set forth in paragraph (f) of this section except the word 
rescheduled is substituted for cancelled.
    (h) Minutes. (1) Detailed minutes of each advisory committee 
meeting, including subgroups, shall be kept.
    (2) The minutes for an open meeting shall as a minimum cover the 
folllowing items: The time and place of the meeting; a listing of 
advisory committee members and staff and agency employees present at the 
meeting; a complete summary of matters discussed and conclusions 
reached; copies of all reports received, issued, or approved by the 
advisory committee; a description of the extent to which the meeting was 
open to the public; an explanation of the extent of public 
participation, including a list of members of the public who presented 
oral or written statements; and an estimate of the number of members of 
the public who attended the meeting.
    (3) The minutes for a closed meeting shall include all that is 
required for an open meeting except those items relating to the presence 
of the public.
    (4) The chairperson of each advisory committee shall certify the 
accuracy of the committee minutes.

(22 U.S.C. 2658 and 3926)
[40 FR 28606, July 8, 1975, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 8.10  Reports.

    (a) There are two categories of reports on advisory committees. One 
category is concerned with management and the other with advisory 
activities.
    (b) Management reports include:
    (1) Comprehensive Review. An annual review shall be conducted on a 
calendar year basis to determine the essentiality of the committee. The 
results of that Review are included in the Annual Report. The due date 
is October 1.
    (2) Annual Report. A calendar year report which covers the status of 
the committee. It is a component report for the President's annual 
report to the Congress. The due date is December 31.
    (3) Report of Closed Meeting(s). A summary of the activities and 
related matters discussed by a committee during a closed meeting shall 
be prepared annually. It is to be as informative as possible for the 
public consistent with section 552(b) policy of the Freedom of 
Information Act.
    (4) Other Reports. Other management reports that may be required, 
such as requests from the Office of Management and Budget, Congressional 
Committees, et cetera, will be submitted in accordance with the 
requested due date.
    (c) Advisory activities reports are reports issued by the committee. 
They are to be submitted, when prepared in final as a committee document 
or published, on a current basis.
    (d) All reports are submitted to the Advisory Committee Management 
Officer.
    (1) The Comprehensive Review is signed by the responsible committee 
officer and approved by the bureau/office policy making officer. It is 
submitted in original only.
    (2) The Annual Report will be prepared on Standard Forms 248 and 249 
in original and one copy. (Instructions for preparation are printed on 
the back of the forms.)

[[Page 29]]

    (3) The Report of Closed Meeting(s) is signed by the committee 
chairman and submitted in original and 8 copies.
    (4) The Advisory activities reports are submitted in 9 copies each, 
except Presidential advisory committee reports are submitted in 12 
copies.



Sec. 8.11  Records.

    (a) The records of an advisory committee consist of all papers and 
documents which are prepared for or by and/or made available to the 
committee, and are maintained by the office responsible for the 
committee. Such records are inter alia agenda, drafts, minutes, notices, 
press releases, reports, studies, transcripts, and working papers.
    (b) The Advisory Committee Management Officer maintains the 
Department's official records relating to the management of all 
committees.



Sec. 8.12  Financial records.

    Accurate records will be kept by the responsible committee office of 
all operating and salary costs of a committee. (See instruction item 17 
on SF-248.)



Sec. 8.13  Availability of records.

    The records of a committee are to be made available upon request in 
accordance with the Department's regulations promulgated in accordance 
with the provisions of the Freedom of Information Act (40 Federal 
Register 7256-7529, February 19, 1975).



Sec. 8.14  Public inquiries.

    Public inquiries concerning the implementation of the Federal 
Advisory Committee Act and the management of the advisory committees of 
the Department should be addressed to the Advisory Committee Management 
Officer, Management Systems Staff, Department of State, Washington, DC 
20520.



PART 9--SECURITY INFORMATION REGULATIONS--Table of Contents




Sec.
9.1  General policy.
9.2  Implementation and oversight responsibilities.
9.3  Responsibility for safeguarding classified information.
9.4  Classification.
9.5  Classification designations.
9.6  Requirements for classification.
9.7  Classification authority.
9.8  Limitations on classification.
9.9  Duration of classification.
9.10  Derivative classification.
9.11  Derivative classification guides.
9.12  Identification and markings.
9.13  Transferred material.
9.14  Declassification and downgrading.
9.15  Systematic review for declassification guidelines.
9.16  Mandatory review.
9.17  Schedule of fees.
9.18  Access by Presidential appointees.

Appendix A to Part 9--Definitions

    Authority:  E.O. 12356, National Security Regulations of April 2, 
1982 (47 FR 14874, April 6, 1982): Information Security Oversight Office 
Directive No. 1 (47 FR 27836, June 25, 1982).

    Source:  47 FR 55594, Dec. 10, 1982, unless otherwise noted.



Sec. 9.1  General policy.

    (a) E.O. 12356 (hereinafter called ``the Order'') recognizes that it 
is essential that the public be informed concerning the activities of 
its government, but that the interests of the United States and its 
citizens require that certain information concerning the national 
defense and foreign relations be protected against unauthorized 
disclosure. With this object, the Order prescribes a uniform system for 
classifying, declassifying, and safeguarding national security 
information.
    (b) The purpose of these regulations is to assist in the 
implementation of the Order and Information Security Oversight Office 
(hereinafter referred to as ISOO), Directive No. 1, (hereinafter called 
``the Directive''), and users of these regulations may refer to the 
Order and Directive for additional guidance.



Sec. 9.2  Implementation and oversight responsibilities.

    The Order requires each agency that originates or handles classified 
information to promulgate implementing regulations. The Order further 
requires that each agency originating or handling classified material 
shall designate a senior official to direct and administer its 
information security

[[Page 30]]

program. This official shall be responsible for actively overseeing the 
agency's program, including a security education program, to ensure 
effective implementation of the Order.
    (a) In addition, this official shall have the following 
responsibilities:
    (1) To establish and monitor agency policies and procedures to 
prevent over or under classification, to ensure the protection from 
unauthorized disclosure of properly classified information, including 
intelligence information, and to ensure orderly and effective 
declassification of agency documents which no longer require protection, 
in accordance with the terms of the Order.
    (2) To review proposed classified disclosures of an exceptional 
nature bearing upon issues of concern to the Congress and the public.
    (3) To issue any needed guidelines for classification or 
declassification.
    (4) To recommend to the agency head the following:
    (i) Proposals for reclassification in accordance with section 1.6(c) 
of the Order;
    (ii) Other categories of information, as defined in section 
1.3(a)(10) of the Order, which require protection against unauthorized 
disclosure but which are not specifically protected by sections 1.3(a) 
(1) through (9) of the Order;
    (iii) Waivers, for specified classes of documents or information of 
the requirement to indicate which portions of documents are classified 
and which are not, as provided by section 1.5(b) of the Order; and
    (iv) Waivers for specified classes of documents or information, of 
the requirement to prepare derivative classification guides, as provided 
by section 2.2(c) of the Order.
    (5) To prepare a list of officials, by name or position, delegated 
Top Secret, Secret, and Confidential classification authority.
    (6) To receive, and if necessary act on, suggestions and complaints 
with respect to that agency's administration of its information security 
program.
    (7) To provide guidance concerning corrective or disciplinary action 
in unusually important cases involving unauthorized disclosure or 
refusal to declassify.
    (8) To maintain liaison with the Director of ISOO and to furnish 
reports and information as required by section 5.2 of the Order.
    (b) Department of State. Within the Department of State, the senior 
official is the Deputy Assistant Secretary, Classification/
Declassification Center, hereinafter referred to as (DAS/CDC).
    (c) AID. Within AID (a component of the International Development 
Cooperation Agency), the senior official is the Inspector General.
    (d) USIA. Within USIA, the senior official is the Director, Office 
of the Public Liaison.



Sec. 9.3  Responsibility for safeguarding classified information.

    (a) Primary. The specific responsibility for the maintenance of the 
security of classified information rests with each person having 
knowledge or physical custody thereof, no matter how obtained.
    (b) Individual. Each employee is responsible for becoming familiar 
with and adhering to all security regulations.
    (c) Supervisory. The ultimate responsibility for safeguarding 
classified information rests upon each supervisor to the same degree 
that the supervisor is charged with functional responsibility for the 
organizational unit. While certain employees may be assigned specific 
security responsibilities, such as Top Secret Control Officer or Unit 
Security Officer, it is nevertheless the basic responsibility of 
supervisors to ensure that classified material entrusted to their 
organizational units is handled in accordance with the procedures 
prescribed in these regulations. Each supervisor should ensure that no 
one employee is assigned unreasonable security responsibilities in 
addition to usual administrative or functional duties.
    (d) Organizational. The Offices of Security in State, AID, and USIA 
are responsible for physical, procedural, and personnel security in 
their respective agencies. In the Department of State, the Office of 
Communications (COMSEC) is responsible for communications security.

[[Page 31]]



Sec. 9.4  Classification.

    (a) When there is reasonable doubt about the need to classify 
information, the information shall be safeguarded as if it were 
``Confidential'' pending a determination about its classification by an 
original classification authority. When there is reasonable doubt about 
the appropriate classification level, the information shall be 
safeguarded at the higher level pending the determination of its 
classification level by an original classification authority. 
Determinations hereunder shall be made within 30 days.
    (b) Information may not be classified unless its disclosure 
reasonably could be expected to cause damage to the national security. 
Information may not be classified to conceal violations of law, 
inefficiency, or administrative error; to prevent embarrassment to a 
person, organization, or agency; to restrain competition; or to prevent 
or delay the release of information that does not require protection in 
the interest of national security.
    (c) The President or an agency head or official designated under 
section 1.2 (a)(2), 1.2 (b)(1), or 1.2 (c)(1) of the Order may 
reclassify information previously declassified and disclosed if it is 
determined in writing that (1) the information requires protection in 
the interest of national security, and (2) the information may 
reasonably be recovered. These reclassification actions shall be 
reported promptly to the Director of ISOO.
    (d) It is permitted to classify or reclassify information after an 
agency has received a request for it under the Freedom of Information 
Act or the Privacy Act, or the mandatory review provisions of the Order, 
provided that such classification meets the requirements of the Order 
and is accomplished personally and on a document-by-document basis by 
the agency head, the deputy agency head, the senior official, or an 
official with original Top Secret classification authority. Every effort 
should be made to classify properly at the time of origin. When a 
determination is made that a document requires classification or 
reclassification, however, all holders of the document should be 
notified and, in the Department of State, a copy of the classification 
or reclassification memorandum should be sent to the Foreign Affairs 
Information Management Center (FAIM). In addition, if the classification 
or reclassification was done in any office other than the DAS/CDC, that 
office should send a copy of the pertinent memorandum to the CDC.
    (e) For the Department of State, these functions will be performed 
by the DAS/CDC.
    (f) For AID, the function will be performed by the Administrator.
    (g) For USIA, the function will be performed by the Director of 
Public Liaison.
    (h) Information classified in accordance with these regulations 
shall not be declassified automatically as a result of any unofficial 
publication or inadvertent or unauthorized disclosure in the United 
States or abroad of identical or similar information.



Sec. 9.5  Classification designations.

    (a) Only three (3) designations of classification are authorized: 
``Top Secret,'' ``Secret,'' and ``Confidential.''
    (1) Top Secret. Information may be classified ``Top Secret'' if its 
unauthorized disclosure could reasonably be expected to cause 
exceptionally grave damage to the national security. This classification 
should be used with the utmost restraint. Examples of ``exceptionally 
grave damage'' include armed hostilities against the United States or 
its allies; disruption of foreign relations vitally affecting the 
national security; the compromise of vital national defense plans or 
complex cryptologic and communications intelligence systems; the 
revelation of sensitive intelligence operations; and the disclosure of 
scientific or technological developments vital to national security.
    (2) Secret. Information may be classified ``Secret'' if its 
unauthorized disclosure could reasonably be expected to cause serious 
damage to the national security. This classification should be used 
sparingly. Examples of ``serious damage'' include disruption of foreign 
relations significantly affecting the national security; significant 
impairment of a program or policy directly related to the national 
security; revelation of

[[Page 32]]

significant military plans or intelligence operations; and compromise of 
significant scientific or technological developments relating to 
national security.
    (3) Confidential. Information may be classified ``Confidential'' if 
its unauthorized disclosure could reasonably be expected to cause damage 
to the national security. Except as otherwise provided by statute, no 
other terms shall be used to identify classified information. Terms or 
phrases such as ``For Official Use Only'' or ``Limited Official Use'' 
shall not be used to identify national security information. No other 
term or phrase shall be used in conjunction with these national security 
information designations, such as ``Secret Sensitive'' or ``Agency 
Confidential'' to identify national security information.
    (b) Foreign government information. If classified by the foreign 
government, the information shall either retain its original 
classification or be assigned a U.S. classification designation which 
will ensure a degree of protection at least equivalent to that required 
by the entity that furnished the information. If not given a specific 
classification by the foreign government, the information will be 
assigned an appropriate classification dependent on the sensitivity of 
the subject matter and the degree of damage its unauthorized disclosure 
could reasonably be expected to cause to the national security. 
Classification designations assigned by the U.S. agency shall be marked 
on the foreign government information in accordance with the provisions 
of Sec. 9.12.



Sec. 9.6  Requirements for classification.

    With the exception of the Atomic Energy Act of 1954, as amended, 
these regulations are the only basis for classifying information in the 
agencies named herein. To be eligible for classification, information 
must meet the two following requirements:
    (a) First, it must deal with one of the following criteria:
    (1) Military plans, weapons, or operations;
    (2) The vulnerabilities or capabilities of systems, installations, 
projects, or plans relating to the national security;
    (3) Foreign government information;
    (4) Intelligence activities (including special activities), or 
intelligence sources or methods;
    (5) Foreign relations or foreign activities of the United States;
    (6) Scientific, technological, or economic matters relating to the 
national security;
    (7) U.S. Government programs for safeguarding nuclear materials or 
facilities;
    (8) Cryptology;
    (9) Confidential sources; or
    (10) Other categories of information that are related to the 
national security and that require protection against unauthorized 
disclosure as determined by the President or by agency heads or other 
officials who have been delegated original classification authority by 
the President. In the Department of State, the DAS/CDC, as the senior 
official, shall recommend such other categories of information to the 
Secretary. Any determination made under this subsection shall be 
reported promptly to the Director of ISOO.
    (b) Second, an official with original classification authority must 
determine that the unauthorized disclosure of the information, either by 
itself or in the context of other information, reasonably could be 
expected to cause damage to the national security. Unauthorized 
disclosure of foreign government information, the identity of a 
confidential foreign source, or intelligence sources or methods is 
presumed to cause damage to the national security.
    (c) Certain information which would otherwise be unclassified may 
require classification when combined or associated with other classified 
or unclassified information. Classification on this basis shall be 
supported by a written explanation that, at a minimum, shall be 
maintained with the file or record copy of the information.



Sec. 9.7  Classification authority.

    (a) In the Department of State authority for original classification 
of information as ``Top Secret'' may be exercised only by the Secretary 
of State and those officials delegated this authority in writing, by 
position or by name, by the Secretary or the DAS/

[[Page 33]]

CDC, as the senior official, on the basis of their frequent need to 
exercise such authority. Normally these will not be below the level of 
Deputy Assistant Secretary in the Department; or Chief of Mission, 
Charge d'Affairs, or principal officer at an autonomous consular post 
overseas.
    (b) Authority for original classification of information as 
``Secret'' may be exercised by officials with Top Secret authority, the 
Administrator of AID, and the Director of USIA. This authority may be 
delegated to such subordinate officials as the senior official in the 
Department, the administrator of AID or the Director of USIA may 
designate in writing, by position or by name, on the basis of their 
frequent need to exercise such authority. Normally, these will not be 
below the level of office director, section head (in a mission abroad), 
country public affairs officer, or equivalent.
    (c) Authority for original classification of information as 
``Confidential'' may be exercised by officials with Top Secret or Secret 
classification authority, and the President of the Overseas Private 
Investment Corporation; and may be delegated to such subordinate 
officials as the senior official in the Department, the Administrator of 
AID, the Director of USIA, or the President of OPIC may designate in 
writing, by position or by name, on the basis of their frequent need to 
exercise such authority.
    (d) Delegated original classification authority at any level may not 
be redelegated.
    (e) In the absence of an authorized classifier, the person 
designated to act for that official may exercise the classifying 
authority.
    (f) In the Department of State the Classification/Declassification 
Center, and in AID and USIA the Office of Security, shall maintain a 
current listing, by classification designation, of the positions or 
officials carrying original classification authority. The listing shall 
be reviewed as needed to ensure that such delegations have been held to 
a minimum, and that officials so designated have a continuing need to 
exercise such authority.



Sec. 9.8  Limitations on classification.

    A reference to classified documents which does not directly or 
indirectly disclose classified information may not be classified or used 
as a basis for classification.



Sec. 9.9  Duration of classification.

    (a) Information shall be classified for as long as is required by 
national security considerations. When it can be determined, a specific 
date or event for declassification shall be set by the original 
classification authority at the time the information is originally 
classified.
    (b) Information classified under predecessor orders that is not 
subject to automatic declassification or that is marked for review 
before declassification shall remain classified until reviewed for 
declassification.
    (c) Automatic declassification determinations under predecessor 
orders shall remain valid unless the classification is extended by an 
authorized official of the originating agency. These extensions may be 
by individual documents or categories of information. The agency shall 
be responsible for notifying holders of the information of such 
extensions as soon as possible. The authority to extend the 
classification of information subject to automatic declassification 
under predecessor orders is limited to those officials who have 
classification authority over the information and are designated in 
writing to have original classification authority at the level of the 
information to remain classified. Any decision to extend this 
classification on other than a document-by-document basis shall be 
reported to the Director of the ISOO.



Sec. 9.10  Derivative classification.

    (a) Derivative classification is made by a person, not necessarily 
having original classification authority, based on an originally 
classified document or as directed by a classification guide. The 
derivative classifier may be one who reproduces, extracts, restates, 
paraphrases, or summarizes classified materials, or applies markings in 
accordance with source material or a classification guide.

[[Page 34]]

    (b) Derivative classifiers must respect original classification 
markings. Only if the derived document, by means of paraphrasing, 
excising, etc., has clearly lost the original grounds for 
classification, may its original classification be removed or lowered.
    (c) Subject to paragraph (b) of this section, markings on 
derivatively classified material, including declassification 
instructions, shall be carried forward from the original material, or 
shall be as directed by the classification guide.



Sec. 9.11  Derivative classification guides.

    (a) Agencies with original classification authority shall prepare 
classification guides to facilitate the proper and uniform derivative 
classification of information, except as provided in paragraph (e) of 
this section.
    (b) Each guide shall be approved personally and in writing by an 
official who:
    (1) Has program or supervisory responsibility over the information 
or is the senior agency official who directs and administers the 
information security program; and
    (2) Is authorized to classify information originally at the highest 
level of classification prescribed in the guide.
    (c) Classification guides shall, at a minimum:
    (1) Identify or categorize the elements of information to be 
protected;
    (2) State which classification level applies to each element or 
category of information; and
    (3) Prescribe declassification instructions for each element or 
category of information in terms of (i) a period of time, (ii) the 
occurrence of an event, or (iii) a notation that the information shall 
not be automatically declassified without the approval of the 
originating agency.
    (d) Classification guides shall be reviewed at least every two years 
and updated as necessary. Each agency shall maintain a list of its 
classification guides in current use.
    (e) Agency heads may, for good cause, grant and revoke waivers of 
the requirement to prepare classification guides for specified classes 
of documents or information. In the Department of State, the DAS/CDC, as 
senior official, shall make recommendations to the Secretary concerning 
such waivers. In AID, the Inspector General shall make recommendations 
to the Administrator concerning such waivers. In USIA, the Director of 
the Office of Public Liaison shall make recommendations to the Director 
concerning such waivers. The Director of ISOO shall be notified of any 
waivers. The decision to waive the requirement to issue classification 
guides for specific classes of documents or information should be based, 
at a minimum, on an evaluation of the following factors:
    (1) The ability to segregate and describe the elements of 
information;
    (2) The practicality of producing or disseminating the guide because 
of the nature of the information;
    (3) The anticipated usage of the guide as a basis for derivative 
classification; and
    (4) The availability of alternative sources for derivatively 
classifying the information in a uniform manner.



Sec. 9.12  Identification and markings.

    Except in extraordinary circumstances as as provided in section 
1.5(a) of the Order, or as indicated herein, the marking of paper 
documents shall not deviate from the following prescribed formats. These 
markings shall also be affixed to material other than paper documents, 
or the originator shall provide holders or recipients of the information 
with written instructions for protecting the information. These markings 
include one of the three (3) classification levels defined in Sec. 9.5, 
the identity of the original classification authority (except as noted 
under paragraph (b)(ii) of this section) the agency and office of origin 
(except as noted under paragraph (b)(ii) of this section) and the date 
or event for declassification or the notation ``Originating Agency's 
Determination Required'' (OADR).
    (a) Classification level. The markings ``Top Secret,'' ``Secret,'' 
and ``Confidential'' are used to indicate: That information requires 
protection as national security information under the Order; the highest 
level of classification contained in a document; and the classification 
level of each page and, in

[[Page 35]]

abbreviated form, each portion of a document.
    (1) Overall marking. The highest level of classification of 
information in a document shall be marked in such a way as to 
distinguish it clearly from the informational text. These markings shall 
appear at the top and bottom of the outside of the front cover (if any), 
on the title page (if any), on the first page, and on the outside of the 
back cover (if any).
    (2) Page marking. Each interior page of a classified document shall 
be marked at the top and bottom either according to the highest 
classification of the content of the page, including the designation 
``UNCLASSIFIED'' when it is applicable, or with the highest overall 
classification of the document.
    (3) Portion-marking. Agency heads may waive the portion marking 
requirement for specified classes of documents or information only upon 
a written determination that (i) there will be minimal circulation of 
the specified documents or information and minimal potential usage of 
these documents or information as a source for derivative classification 
determination; or (ii) there is some other basis to conclude that the 
potential benefits of portion marking are clearly outweighed by the 
increased administrative burdens. Unless this requirement has been 
waived, each portion of a document, including subjects and titles, shall 
be marked by placing a parenthetical designation immediately preceding 
or following the text to which it applies. The symbols ``(TS)'' for Top 
Secret, ``(S)'' for Secret, ``(C)'' for Confidential, and ``(U)'' for 
Unclassified shall be used for this purpose. If the application of these 
symbols is not practicable, the document shall contain a statement 
sufficient to identify the information that is classified and the level 
of such classification, and the information that is not classified. If 
all portions of a document are classified at the same level, it may be 
marked with a statement to that effect, e.g., ``Confidential--Entire 
Text.'' If a subject or title requires classification, an unclassified 
identifier may be assigned to facilitate reference.
    (A) For the Department of State, the Secretary has waived the 
portion marking requirement for the following classes of documents under 
section 2001.5(a)(3)(i) of the Directive--documents which will have 
minimal circulation and minimal potential usage as a source for 
derivative classification:
    (1) Documents containing Top Secret information;
    (2) Action/informational memoranda prepared for Assistant 
Secretaries and above;
    (3) Instructions to posts and negotiating delegations;
    (4) In-house research studies; and
    (5) Inter and intra-office memoranda.
    (B) The Secretary has also waived the portion marking requirement 
for documents, both telegraphic and non-telegraphic, containing foreign 
government information, under section 2001.5(a)(3)(ii) of the Directive.
    (4) Omitted markings. Information assigned a level of classification 
under predecessor orders shall be considered as classified at the level 
of classification despite the omission of other required markings. 
Omitted markings may be inserted on a document by the officials 
specified in section 3.1(b) of the Order.
    (b) Classification authority. If the original classifier is other 
than the signer or approver of the document, the identity shall be shown 
as ``CLASSIFIED BY'' (``identification of original classification 
authority'').
    (c) Agency and office of origin. If the identity of the originating 
agency and office is not apparent on the face of the document, it shall 
be placed below the ``CLASSIFIED BY'' line.
    (d) Declassification and downgrading instructions. Declassification 
and, as applicable, downgrading instructions shall be shown as follows:
    (1) For information to be declassified automatically on a specific 
date or event: ``DECLASSIFY ON: (date)'' or ``DECLASSIFY ON: 
(description of event)''.
    (2) For information not to be automatically declassified: 
``DECLASSIFY ON: Originating Agency Determination Required or OADR''.
    (3) For information to be downgraded automatically on a specific 
date or upon occurrence of a specific event: ``DOWNGRADE TO 
(classification

[[Page 36]]

level) ON (date or description of event)''.
    (e) Special markings--(1) Transmittal documents. A transmittal 
document shall indicate on its face the highest classification of any 
information transmitted by it. It shall also include the following or 
similar instructions:
    (i) For an unclassified transmittal document: ``Unclassified When 
Classified Enclosure is Removed;'' or
    (ii) For classified transmittal document: ``Upon Removal of 
Attachments This Document Is (classification level of the transmittal 
document standing alone).''
    (2) Restricted Data or Formerly Restricted Data. Restricted Data and 
Formerly Restricted Data information shall be marked in accordance with 
regulations issued under the Atomic Energy Act of 1954, as amended.
    (3) Intelligence sources or methods. Documents that contain 
information relating to intelligence sources or methods shall include 
the following markings unless otherwise prescribed by the Director of 
Central Intelligence: ``WARNING NOTICE--INTELLIGENCE SOURCES OR METHODS 
INVOLVED.''
    (4) Foreign government information (FGI). Documents that contain FGI 
shall include either the marking ``FOREIGN GOVERNMENT INFORMATION'', or 
a marking that otherwise indicates that the information is foreign 
government information. If the fact that information is foreign 
government information must be concealed, the marking shall not be used 
and the document shall be marked as if it were wholly of U.S. origin.
    (5) Electrically transmitted information (messages, cables). 
National security information that is transmitted electrically shall be 
marked as follows:
    (i) The highest level of classification shall appear before the 
first line of text;
    (ii) A ``Classified By'' line is not required; i.e., name and office 
of classifier may be omitted; and
    (iii) The duration of classification shall appear as follows:
    (A) For information to be declassified automatically on a specific 
date or event: ``DECL: (date)'' or ``DECL: (description of event).''
    (B) For information not to be automatically declassified which 
requires the originating agency's determination: ``DECL: OADR.''
    (C) For information to be automatically downgraded: ``DNG 
(abbreviation of classification level to which the information is to be 
downgraded and date or description of event on which downgrading is to 
occur).''
    (iv) Portion marking shall be as prescribed in paragraph (a)(3) of 
this section.
    (v) Special markings as prescribed in section 2001.5(e) 2, 3, & 4 of 
the Directive shall appear after the marking for the highest level of 
classification. These include:
    (A) Restricted Data or Formerly Restricted Data: Electrically 
transmitted information containing Restricted Data or Formerly 
Restricted Data shall be marked in accordance with regulations issued 
under the Atomic Energy Act of 1954, as amended.
    (B) Information concerning intelligence sources and methods; 
``WNINTEL,'' unless proscribed by the Director of Central Intelligence.
    (C) Foreign government information: ``FGI'' or a marking that 
otherwise indicates that the information is foreign government 
information. If the fact must be concealed, the marking shall not be 
used and the message shall be marked as if it were wholly of U.S. 
origin.
    (vi) Paper copies of electrically transmitted messages shall be 
marked as provided in paragraph (a) through (e) of this section.
    (6) Changes in classification markings. When a change is made in the 
level or the duration of classified information, all holders of record 
shall be promptly notified. Holders shall alter the markings to conform 
to the change, citing the authority for it. If the remarking of large 
quantities of information is unduly burdensome, the holder may attach a 
change of classification notice to the storage unit in lieu of the 
marking action otherwise required. Items withdrawn from the collection 
for purposes other than transfer for storage shall be marked promptly in 
accordance with the change notice.

[[Page 37]]



Sec. 9.13  Transferred material.

    (a) In the case of classified information transferred in conjunction 
with a transfer of functions, and not merely for storage purposes, the 
receiving agency shall be deemed to be the originating agency for 
purposes of the Order.
    (b) In the case of classified information that is not officially 
transferred as described in section 3.2(a) of the Order, but that 
originated in an agency that has ceased to exist and for which there is 
no successor agency, each agency in possession of such information shall 
be deemed to be the originating agency for purpose of the Order. Such 
information may be declassified or downgraded by the agency in 
possession after consultation with any other agency that has an interest 
in the subject matter of the information.
    (c) Classified information accessioned into the National Archives of 
the United States shall be declassified or downgraded by the Archivist 
of the United States in accordance with the Order, the Directive, and 
agency guidelines.



Sec. 9.14  Declassification and downgrading.

    (a) General. Information should be declassified or downgraded as 
soon as national security considerations permit. Information will be 
protected in accordance with the provisions of the Order for as long as 
it meets the classification requirements prescribed by these 
regulations. Agencies shall coordinate their review of classified 
information with other agencies or foreign governments that have a 
direct interest in the subject matter.
    (b) Authority to declassify or downgrade. Information shall be 
declassified or downgraded by the official who authorized the original 
classification, if that official is still serving in the same position; 
the originator's successor; a supervisory official of either; or 
officials delegated such authority in writing by the agency head or the 
senior agency official designated pursuant to section 5.3(a)(1) of the 
Order. In addition, if the Director of ISOO determines that information 
is classified in violation of the Order, the Director may require the 
agency which classified the information to declassify it. Any such 
decision by the Director may be appealed to the National Security 
Council. The information shall remain classified until a decision has 
been made on the appeal.
    (c) The agency shall maintain a current, unclassified, listing of 
officials delegated declassification and downgrading authority.



Sec. 9.15  Systematic review for declassification guidelines.

    (a) The agency may schedule classified records of permanent 
historical or other value for bulk review for declassification and may 
either perform such review itself, or may refer the records, together 
with guidelines for declassification, to the Archivist of the United 
States for review.
    (b) For records of the Department of State, a sampling of classified 
records of permanent value for a given period will be selected by the 
Office of the Historian (PA/HO), and reviewed by the Systematic Review 
Office of the Classification/Declassification Center. The Systematic 
Review Office will prepare guidelines, which will be transmitted by the 
Secretary of State to the Archivist of the United States, not later than 
February 1, 1983, for use in reviewing the remainder of the permanently 
valuable classified records of the given period when these records are 
accessioned to the National Archives.
    (c) AID will prepare guidelines, and transmit them to the Archivist 
of the United States not later than February 1, 1983, for use in 
reviewing permanently valuable classified records that have been 
accessioned to the National Archives. The Records Management Branch, 
Communications and Records Management Division, (M/SER/MO), is 
designated as the office responsible for systematic review matters 
within the agency. The Branch Staff will provide assistance to the 
Archivist in the systematic review process.
    (d) For information concerning records of ICA, contact the agency's 
Declassification Officer, Office of Administration.
    (e) The agency guidelines will identify categories of information 
which cannot be automatically declassified but must be reviewed item-by-
item to

[[Page 38]]

determine if there is a need for continued protection.
    (f) These guidelines may be authorized by the agency head for use by 
other agencies, in addition to the National Archives, having custody of 
the originating agency's classified information of the period covered.
    (g) These guidelines shall be reviewed and updated every five years, 
unless earlier review is requested by the Archivist.
    (h) For foreign government information, the agency will prepare by 
February 1, 1983, specific guidelines for systematic review of foreign 
government information in records accessioned to the National Archives, 
and will revise such guidelines every five years or earlier as requested 
by the Archivist.
    (i) Special procedures. The agency shall be bound by the special 
procedures for systematic review of classified cryptologic records and 
classified records pertaining to intelligence activities (including 
special activities) sources or methods issued by the Secretary of 
Defense and the Director of Central Intelligence, respectively.



Sec. 9.16  Mandatory review.

    Each agency shall review for declassification any classified 
information requested, under the Mandatory Review provisions of the 
Order except as noted in paragraph (d) of this section, provided that: 
The requester is a U.S. citizen, resident alien, Federal agency, or 
state or local government; the request describes the information with 
sufficient specificity to enable the agency to locate the records 
containing the information with a reasonable amount of effort; and the 
agency receiving the request is the agency that originated the 
information. When an agency receives a request for information in its 
custody which was originated by another agency, it shall refer the 
information and request to the originating agency for its review and 
direct response to the requester.
    (a) Foreign government information. Except as provided in this 
paragraph, agencies shall process mandatory review requests for 
classified records containing foreign government information in 
accordance with Sec. 2001.32(a) of the ISOO Directive. The agency that 
initially received or classified the foreign government information 
shall be responsible for making a declassification determination after 
consultation with concerned agencies. If the agency receiving the 
request is not the agency that received or classified the foreign 
government information, it shall refer the request to the appropriate 
agency for action. Consultation with the foreign originator through 
appropriate channels may be necessary prior to final action on the 
request.
    (b) Information requested shall be declassified if it no longer 
requires protection under the provisions of the Order. It will then be 
released to the requester unless withholding is otherwise authorized 
under applicable law, such as the Freedom of Information or Privacy Act. 
If the information requested cannot be declassified in its entirety, the 
agency will make reasonable efforts to release those declassified 
portions that constitute a coherent segment. Upon the denial of an 
initial request, the agency shall also notify the requester of the right 
of administrative appeal, which must be filed within 60 days of receipt 
of the denial, and shall enclose a copy of the agency's regulations 
governing the appeal process.
    (c) Initial requests may be addressed to:
    (1) Department of State: The Information and Privacy Coordinator, 
Room 1239, Bureau of Administration, Department of State, Washington, DC 
20520, with the envelope clearly marked MANDATORY REVIEW REQUEST;
    (2) AID: Director, Office of Public Affairs for AID; Room 4899, 2201 
C Street, NW., Washington, DC 20523; or
    (3) USIA: Freedom of Information and Privacy Act Coordinator, Office 
of Administration, 1776 Pennsylvania Avenue, NW., Washington, DC 20547.
    (d) In responding to mandatory review requests, agencies shall 
either make a prompt declassification determination and notify the 
requester accordingly, or inform the requester of the additional time 
needed to process the case. Agencies shall make a final determination in 
one year from the date of receipt, except in unusual circumstances.

[[Page 39]]

    (e) Information originated by a President, the White House Staff, by 
committees, commissions, or boards appointed by the President, or others 
specifically providing advice and counsel to a President or acting on 
behalf of a President is exempted from mandatory review. However, the 
Archivist of the United States has the authority to review, downgrade, 
and declassify such information which is under the control of the 
Administrator of General Services or the Archivist, for example in 
Presidential Libraries, pursuant to section 2107, 2107 note, or 2203 of 
title 44, United States Code. The Archivist will consult with agencies 
having primary subject matter interest concerning the declassification 
of the requested material. Any decision by the Archivist may be appealed 
to the Director of ISOO, with the right of further appeal to the 
National Security Council. The information shall remain classified 
pending a prompt decision on the appeal.
    (f) Requests for classified information not specifically identified 
as being made under the Mandatory Review provisions of the Order will be 
processed under the terms of the FOIA, the Privacy Act, or other 
appropriate procedures.
    (g) In considering requests for mandatory review, the agency may 
decline to review again any request for material which has been recently 
reviewed and denied, unless the request constitutes an appeal of an 
initial denial.
    (h) Mandatory review requests for cryptologic information and 
information concerning intelligence activities (including special 
activities) or intelligence sources or methods shall be processed solely 
in accordance with special procedures issued by the Secretary of Defense 
and the Director of Central Intelligence, respectively.
    (i) In response to a request for information under the Freedom of 
Information Act, the Privacy Act of 1974, or the mandatory review 
provisions of the Order, an agency shall refuse to confirm or deny the 
existence or non-existence of requested information whenever the fact of 
its existence or non-existence is itself classifiable under these 
regulations.
    (j) For detailed regulations for the internal processing of 
mandatory review initial requests and appeals see:
    (1) Department of State: 5 FAM 900, 22 CFR 171.22 and 171.60;
    (2) AID: AID Handbook 18, part III, chapter 11; or
    (3) USIA: 22 CFR part 503.



Sec. 9.17  Schedule of fees.

    For State, see 22 CFR 171.6 and 171.13; For AID, see 22 CFR 212.35; 
or For USIA, see 22 CFR 503.6(c).



Sec. 9.18  Access by presidential appointees.

    For procedures of the Department of State, see 22 CFR 171.25; For 
procedures of AID, see 22 CFR 171.25; or For procedures of USIA, see 22 
CFR part 503.

                    Appendix A to Part 9--Definitions

    For the purpose of these security regulations, the following 
definitions of terms shall apply.
    Agency. A Federal agency, including department, agency, commission 
etc, as defined in 5 U.S.C. 552(e).
    Original classification. The initial determination that, in the 
interest of national security, information requires protection against 
unauthorized disclosure, together with a classification designation 
signifying the level of protection required.
    Original classification authority. The authority vested in an 
executive branch official to make a determination of original 
classification. A person having original classification authority may 
also have the authority to prolong or restore classification.
    Originating agency. The agency responsible for the initial 
determination that particular information is classified.
    Information. Any information or material, regardless of its physical 
form or characteristics, that is owned by, produced by or for, or is 
under the control of the U.S. Government.
    National security information. Information that has been determined 
pursuant to this Order or any predecessor Order to require protection 
against unauthorized disclosure and that is so designated.
    Foreign government. Includes foreign governments and international 
organizations of governments.
    Foreign government information. Foreign government information is: 
(1) Information provided by a foreign government or governments, an 
international organization of governments, or any element thereof with 
the expectation, expressed or implied, that the information, the source 
of the information,

[[Page 40]]

or both, are to be held in confidence; or (2) Information produced by 
the United States pursuant to or as a result of a joint arrangement with 
a foreign government or governments or an international organization of 
governments, or any element thereof, requiring that the information, the 
arrangement, or both, are to be held in confidence.
    National security. The national defense or foreign relations of the 
United States.
    Confidential source. Any individual or organization that has 
provided, or that may reasonably be expected to provide, information to 
the United States on matters pertaining to the national security with 
the expectation, expressed or implied, that the information or 
relationship, or both, be held in confidence.
    Classification guide. A document issued by an authorized original 
classifier that prescribes the level of classification and appropriate 
declassification instructions for specified information to be classified 
derivatively.
    Derivative classification. A determination that information is in 
substance the same as information currently classified, together with 
the designation of the level of classification.
    Special access program. Any program imposing ``need-to-know'' or 
access controls beyond those normally provided for access to 
Confidential, Secret, or Top Secret information. Such a program may 
include, but is not limited to, special clearance, adjudication, or 
investigative requirements, special designations of officials authorized 
to determine ``need-to-know,'' or special lists of persons determined to 
have a ``need-to-know.'' It does not include special captions such as 
NODIS, LIMDIS.
    Intelligence activity. An activity that an agency within the 
Intelligence Community is authorized to conduct pursuant to the Order.
    Unauthorized disclosure. A communication or physical transfer of 
classified information to an unauthorized recipient.



PART 9a--SECURITY INFORMATION REGULATIONS APPLICABLE TO CERTAIN INTERNATIONAL ENERGY PROGRAMS; RELATED MATERIAL--Table of Contents




Sec.
9a.1  Security of certain information and material related to the 
          International Energy Program.
9a.2  General policy.
9a.3  Scope.
9a.4  Classification.
9a.5  Declassification and downgrading.
9a.6  Marking.
9a.7  Access.
9a.8  Physical protection.

    Authority:  E.O. 11932 (41 FR 32691), E.O. 11652 (37 FR 5209, 
National Security Council Directive of May 17, 1972 (37 FR 10053).

    Source:  42 FR 46516, Sept. 16, 1977; 42 FR 57687, Nov. 4, 1977, 
unless otherwise noted.



Sec. 9a.1  Security of certain information and material related to the International Energy Program.

    These regulations implement Executive Order 11932 dated August 4, 
1976 (41 FR 32691, August 5, 1976) entitled ``Classification of Certain 
Information and Material Obtained from Advisory Bodies Created to 
Implement the International Energy Program.''



Sec. 9a.2  General policy.

    (a) The United States has entered into the Agreement on an 
International Energy Program of November 18, 1974, which created the 
International Energy Agency (IEA). This program is a substantial factor 
in the conduct of our foreign relations and an important element of our 
national security. The effectiveness of the Agreement depends 
significantly upon the provision and exchange of information and 
material by participants in advisory bodies created by the IEA. 
Confidentiality is essential to assure the free and open discussion 
necessary to accomplish the tasks assigned to those bodies.
    (b) These regulations establish procedures for the classification, 
declassification, storage, access, and dissemination of certain 
information related to the International Energy Program.



Sec. 9a.3  Scope.

    These regulations apply to all information and material classified 
by the United States under the provisions of E.O. 11932, dated August 4, 
1976 entitled ``Classification of Certain Information and Material 
Obtained From Advisory Bodies Created To Implement The International 
Energy Program.''



Sec. 9a.4  Classification.

    (a) Section 1 of E.O. 11932, August 4, 1976 directs that information 
and material obtained pursuant to the International Energy Program and 
which requires protection against unauthorized disclosure in the 
interest of the national defense or foreign relations of

[[Page 41]]

the United States shall be classified pursuant to Executive Order 11652.
    (b) Information and material, including transcripts, records, and 
communications, in the possession of the United States Government which 
has been obtained pursuant to (1) section 252(c)(3), (d)(2) or (e)(3) of 
the Energy Policy and Conservation Act (89 Stat. 871, 42 U.S.C. 
6272(c)(3), (d)(2), (e)(3)), or (2) The Voluntary Agreement and Program 
Relating to the International Energy Program (40 FR 16041, April 8, 
1975), or (3) the Voluntary Agreement and Plan of Action to Implement 
the International Energy Program (41 FR 13998, April 1, 1976), or (4) 
Any similar Voluntary Agreement and Program entered into under the 
Energy Policy and Conservation Act shall be reviewed by an officer of 
the Department of State with classifying authority for the purpose of 
determining whether such information or material should be classified 
pursuant to E.O. 11652. If the officer determines that the information 
or material warrants classification, he shall assign it the appropriate 
classification. Such information or material may be exempted from the 
General Declassification Schedule established by section 5 of Executive 
Order No. 11652 if it was obtained by the United States on the 
understanding that it be kept in confidence, or if it might otherwise be 
exempted under section 5(B) of such Order.
    (c) In classifying such information or material, officers of the 
Department of State shall follow the standards in E.O. 11652 and the 
provisions of 22 CFR 9.5 through 9.8.



Sec. 9a.5  Declassification and downgrading.

    The provisions of E.O. 11652, 22 CFR 9.9 through 9.15, and 9a.4(b) 
shall govern declassification and downgrading of such information or 
material.



Sec. 9a.6  Marking.

    (a) The provisions of 22 CFR 9.15 through 9.19 shall govern the 
marking of information or material classified under the provisions of 
these regulations, except that the following stamp shall be used as 
appropriate:

(Top Secret, Secret or Confidential)
Classified by: ------------------------------
Under Executive Order 11932
Exempt from General Declassification Schedule of E.O. 11652 Exemption 
Category section 5B (2), (3), or (4); or E.O. 11932
Automatically Declassified on --------------
(effective date or event if any)


Exemption category ``E.O. 11932'' shall be used for information and 
material obtained by the United States on e understanding that it be 
kept in confidence and classified under E.O. 11932.
    (b) If the information or material does not qualify for exemption 
from the General Declassification Schedule, ordinary stamps and marking 
may be used.



Sec. 9a.7  Access.

    (a) Except as set forth in this section, access to information or 
material classified under the provisions of these regulations shall be 
governed by the provisions of 22 CFR 9.20 through 9.25.
    (b) Classified information and material which was created by or in 
connection with an advisory body to the IEA may be made available to 
participants in such advisory body and their colleagues in accordance 
with the following subsections.
    (c) Such information and material classified ``Confidential'' may be 
made available for review to participants in the meeting of the advisory 
body in which it was developed or discussed. Where participants are 
acting as representatives of companies or of the IEA Secretariat, such 
information and material may be made available for review to employees 
or other representatives of, or counsel for, such companies or 
Secretariat: Provided, That such person is determined by an appropriate 
officer of the Department to be trustworthy and to have a need for 
access to the particular classified information sought in connection 
with the performance of duties in furtherance of the purposes of the 
IEA, including the furnishing of legal advice to such participants.
    (d) Such information and material classified ``Confidential'' may be 
left in the custody of such participants or other persons who may review 
it for reasonable period of time: Provided, That an appropriate officer 
of the Department determines that it will be protected from unauthorized 
disclosure

[[Page 42]]

by adequate security safeguards. Such information or material may not be 
reproduced by those permitted to review it pursuant to this section 
without the written consent of an officer of the Department with 
classifying authority.
    (e) Such information and material classified other than 
``Confidential'' under E.O. 11652 may be made available for review only 
to participants in the meeting in which it was developed or discussed; 
it must be reviewed in the presence of an official of the United States 
Government with an appropriate security clearance granted by the 
Department, and may not be left in the custody of such participants.



Sec. 9a.8  Physical protection.

    Except as provided in Sec. 9a.7, the physical protection of 
information or material classified under this regulation shall be 
governed by the appropriate provisions of 22 CFR 9.45 through 9.49.



PART 9b--REGULATIONS GOVERNING DEPARTMENT OF STATE PRESS BUILDING PASSES--Table of Contents




Sec.
9b.1  Press access to the Department of State.
9b.2  Press correspondents employed by United States media 
          organizations.
9b.3  Press correspondents employed by foreign media organizations.
9b.4  Department of State building press pass for technical crews.
9b.5  Temporary Department of State press building passes.
9b.6  Grounds for denial, revocation, or non-renewal of Department of 
          State press building passes.
9b.7  Procedures for denial, revocation, or non-renewal of Department of 
          State press building passes.
9b.8  Term and renewal of Department of State press building passes.

    Authority:  22 U.S.C. 2658.

    Source:  49 FR 4465, Feb. 7, 1984, unless otherwise noted.



Sec. 9b.1  Press access to the Department of State.

    (a) Media correspondents without valid Department of State press 
building passes shall have access to the Main State building identical 
to that enjoyed by members of the public.
    (b) Media correspondents holding valid Department of State press 
building passes:
    (1) May enter and have access 24 hours a day, during regular working 
hours, outside regular working hours, on weekends and on holidays, 
without an appointment, to the reception area of the Diplomatic Lobby, C 
Street Mezzanine area, press booths (Room 2310), press briefing room 
(Room 2118), and when in operation, the Office of Press Relations (Room 
2109).
    (2) May enter and have access without an appointment, on the 
basement level or on the first and second floors, to the cafeteria, post 
office, banks, concessionaries, barber shop, dry cleaners and the 
Foreign Affairs Recreation Association offices for the purposes for 
which they are established and when they are in operation.
    (3) May not escort non-passholders into the Department of State 
building.
    (c) Media correspondents, with or without a Department of State 
press building pass, may enter areas above the second floor of the Main 
State building only if the correspondent is invited by a Department 
employee to attend a specific social or official function in an office 
located above the second floor. Permission to enter areas above the 
second floor is strictly limited to direct passage to and from the 
appointment location of the Department of State employee, or the office 
or reception room where the function takes place.
    (d) Possession of State Department press building pass does not 
confer access to or other privileges at other Federal buildings. It is 
not to be construed as official United States Government recognition, 
approval or accreditation of a correspondent.
[54 FR 1686, Jan. 17, 1989]



Sec. 9b.2  Press correspondents employed by United States media organizations.

    In order to obtain a Department of State press building pass, press 
correspondents employed by United States media organizations must:
    (a) Present to the Office of Press Relations, Department of State, a 
letter from his or her organization stating:

[[Page 43]]

    (1) That the applicant is a bona fide, full-time media correspondent 
based permanently and residing in the Washington, DC, metropolitan area;
    (2) That the applicant is employed by the certifying organization;
    (3) That the organization and the applicant have regular and 
substantial assignments in connection with the Department of State as 
evidence by regular attendance at the daily press briefings.
    (b) Submit to the Office of Press Relations, Department of State, 
Washington, DC 20520, a signed application and FORM DSP-97 for a press 
building pass. Applicants must comply with instructions contained in 
paragraphs 1 and 6 of FORM DSP-97 regarding fingerprinting and prior 
arrests. FORM DSP-97 requires the following information:
    (1) Name;
    (2) Affiliation with news media organizations;
    (3) Date of birth;
    (4) Place of birth;
    (5) Sex;
    (6) Citizenship;
    (7) Social Security or passport number;
    (8) Marital status;
    (9) Spouse name;
    (10) Office address and telephone number;
    (11) Length of employment;
    (12) Home address and telephone number; and
    (13) Length of residence.
[49 FR 4465, Feb. 7, 1984, as amended at 54 FR 1686, Jan. 17, 1989]



Sec. 9b.3  Press correspondents employed by foreign media organizations.

    In order to obtain a Department of State press building pass, 
correspondents employed by foreign media organizations must:
    (a) Present to the Office of Press Relations, Department of State, 
Washington, DC 20520 a letter from his or her organization stating:
    (1) That the applicant is a bona fide, full-time media correspondent 
based permanently and residing in the Washington, DC, metropolitan area:
    (2) That the applicant is employed by the certifying organization;
    (3) That the organization and the applicant have regular and 
substantial assignments in connection with the Department of State as 
evidence by regular attendance at the daily press briefings.
    (b) A letter from the Washington, DC Embassy of the nation where the 
organization is headquartered or from the Embassy of the United States 
in the nation where the organization is headquartered attesting to the 
existence of the news organization and the applicant's employment by 
that organization. The Director of the Office of Press Relations may 
accept a letter from another source attesting to the existence of such 
news organizations and the applicant's employment if, in his or her 
judgment, a substitute letter is warranted.
    (c) Submit to the Office of Press Relations, Department of State, 
Washington, DC 20520 a signed application and FORM DSP-97 for a press 
building pass. Applicants must comply with instructions contained in 
paragraphs 1 and 6 of FROM DSP-97 regarding fingerprinting and prior 
arrests. FORM DSP-97 requires the following information:
    (1) Name;
    (2) Affiliation with news media organizations;
    (3) Date of birth;
    (4) Place of birth;
    (5) Sex;
    (6) Citizenship;
    (7) Social Security or passport number;
    (8) Marital status;
    (9) Spouse name;
    (10) Office address and telephone number;
    (11) Length of employment;
    (12) Home address and telephone number; and
    (13) Length of residence.
[49 FR 4465, Feb. 7, 1984, as amended at 54 FR 1687, Jan. 17, 1989]



Sec. 9b.4  Department of State building press pass for technical crews.

    Department of State press building passes are issued to members of 
television and radio technical crews who provide technical support on a 
daily basis for media correspondents assigned to the Department of 
State.

[[Page 44]]

Members of technical crews who do not possess press passes, but who 
provide technical support for media correspondents assigned to the 
Department of State, may apply to the Office of Press Relations for a 
visitor's pass valid for one day.
[54 FR 1687, Jan. 17, 1989]



Sec. 9b.5  Temporary Department of State press building passes.

    A media correspondent or technician who meets all the qualifications 
stated in Secs. 9b.2(a)(1) and 9b.2(a)(2) or Secs. 9b.3(a) and 9b.3(b), 
but does not have regular and substantial assignments in connection with 
the Department of State may make arrangements with the Office of Press 
Relations for the issuance of a visitor's pass valid for one day.
[54 FR 1687, Jan. 17, 1989]



Sec. 9b.6  Grounds for denial, revocation, or non-renewal of Department of State press building passes.

    In consultation with the Bureau of Diplomatic Security and the 
Office of the Legal Adviser, the Director of the Office of Press 
Relations of the Department of State, may deny, revoke, or not renew the 
Department of State press building pass of any media correspondent or 
technician who:
    (a) Does not meet the qualifications stated in Secs. 9b.2(a)(1), 
9b.2(a)(2) and 9b.2(a)(3) or Secs. 9b.3(a)(1), 9b.3(a)(2), 9b.3(a)(3) 
and 9b.3(b). (Upon denial, revocation, or non-renewal the correspondent 
or technician may not re-apply for a period of one year unless there are 
material changes in meeting the qualifications.) or,
    (b) Poses a risk of harm to the personal safety of Department of 
State or other Governmental personnel or to Government property; or
    (c) Engages or engaged in conduct which there are reasonable grounds 
to believe might violate federal or state law or Department of State 
regulations.
    (d) Has been convicted of a felony (or a crime in a foreign country 
that would be considered a felony if it were committed in the United 
States).
    (e) Fails to claim an approved authorization form for a State 
Department press building pass after notification by the Office of Press 
Relations following a period of three (3) months.
[49 FR 4465, Feb. 7, 1984, as amended at 54 FR 1687, Jan. 15, 1989]



Sec. 9b.7  Procedures for denial, revocation, or non-renewal of Department of State press building passes.

    (a) If the Director of the Office of Press Relations, Department of 
State, anticipates, after consultation with the Office of the Legal 
Adviser, that in applying the standard set forth in Sec. 9b.6 a 
Department of State press building pass might be denied, revoked or not 
renewed, the media correspondent or technician will be notified in 
writing by the Director of the basis for the proposed denial in as much 
detail as the security of any confidential source of information will 
permit. This notification will be sent by registered mail.
    (b) The notification of the proposed denial, revocation or non-
renewal sent to the correspondent will also contain a statement advising 
the correspondent of his or her right to respond to the proposed denial 
and to rebut any factual basis supporting the proposed denial.
    (c) The correspondent shall be allowed thirty (30) days from the 
date of the mailing of the proposed denial, revocation or non-renewal 
notification to respond in writing. The response shall consist of any 
explanation or rebuttal deemed appropriate by the correspondent and will 
be signed by the correspondent under oath or affirmation.
    (d) If the correspondent is unable to prepare a response within 30 
days, an extension for one additional 30-day period will be granted upon 
receipt of the correspondent's written request for such an extension.
    (e) At the time of the filing of the media correspondent's or 
technician's written response to the notification of the proposed 
denial, revocation or non-renewal, the correspondent or technician may 
request, and will be granted, the opportunity to make a personal 
appearance before the Director of the Office of Press Relations, 
Department of State, for the purpose of personally supporting his/her 
eligibility for a press pass and to rebut or explain the factual basis 
for the proposed denial.

[[Page 45]]

The Director shall exercise, in consultation with the Bureau of 
Diplomatic Security and the Office of the Legal Adviser, final review 
authority in the matter. The correspondent or technician may be 
represented by counsel during this appearance.
    (f)(1) On the basis of the correspondent's or technician's written 
and personal response and the factual basis for the proposed denial, 
revocation or non-renewal, the Director of the Office of Press 
Relations, Department of State, will consult with the Bureau of 
Diplomatic Security and the Office of the Legal Adviser to determine 
whether or not further inquiry or investigation concerning the issues 
raised is necessary.
    (2) If a decision is made that no such inquiry is necessary, a final 
decision will be issued in conformity with paragraph (g) of this 
section.
    (3) If a decision is made that such further inquiry is necessary, 
the Director of the Office of Press Relations of the Department of 
State, the Bureau of Diplomatic Security and the Office of the Legal 
Adviser will conduct such further inquiry as is deemed appropriate. At 
the Director's discretion the inquiry may consist of:
    (i) The securing of documentary evidence:
    (ii) Personal interviews:
    (iii) An informal hearing:
    (iv) Any combination of paragraphs (f)(3)(i) through (f)(3)(iii) of 
this section.
    (g) On the basis of the correspondent's or technician's written and 
personal response, the factual basis for the proposed denial and the 
additional inquiry provided for if such inquiry is conducted, the 
Director of the Office of Press Relations of the Department of State 
will consult with the Bureau of Diplomatic Security and the Office of 
the Legal Adviser and expeditiously reach a final decision in accordance 
with the standard set forth in Sec. 9b.6. If a final adverse decision is 
reached, the correspondent or technician will be notified of this final 
decision in writing. This notification will set forth as precisely as 
possible, and to the extent that security considerations permit, the 
factual basis for the denial in relation to the standard set forth in 
Sec. 9b.6. This notification will be sent by registered mail and will be 
signed by the Director of the Office of Press Relations of the 
Department of State.
[49 FR 4465, Feb. 7, 1984, as amended at 54 FR 1687, Jan. 17, 1989]



Sec. 9b.8  Term and renewal of Department of State press building passes.

    (a) Department of State press building passes for U.S. citizens are 
issued with three years' validity. Subject to positive completion of an 
international background check, passes for non-U.S. citizens are issued 
with one year's validity and may be renewed for three years. 
Notwithstanding its initial validity, any press building pass that has 
not been used for a twelve-month period, as recorded by the Bureau of 
Diplomatic Security's turnstyle entry devices, will become invalid at 
the end of that twelve-month period.
    (b) For any valid passes issued before October 1, 1995, notification 
shall be sent by the Department of State to the holder of the pass that 
the pass has become invalid by reason of lack of use for 12-month 
period. However, failure of the holder for any reason to receive such a 
notification shall not affect the invalidity of the pass. Anyone whose 
pass has become invalid may apply for a new pass in accordance with 
Secs. 9b.2 through 9b.5.
[61 FR 3800, Feb. 2, 1996]

[[Page 46]]



                         SUBCHAPTER B--PERSONNEL





PART 10--EMPLOYEE RESPONSIBILITIES AND CONDUCT--Table of Contents




                      Subpart A--General Provisions

Sec.
10.735-101  Purpose.
10.735-102  Definitions.
10.735-103  Interpretation and advisory service.
10.735-104  Applicability to detailed employees.
10.735-105  Disciplinary action.

 Subpart B--Ethical and Other Conduct and Responsibilities of Employees

10.735-201  General.
10.735-202  Gifts, entertainment, and favors.
10.735-203  Gifts from foreign governments.
10.735-204  Outside employment and other activity.
10.735-205  Financial interests.
10.735-206  Economic and financial activities of employees abroad.
10.735-207  Use of Government property.
10.735-208  Misuse of information.
10.735-209  Indebtedness.
10.735-210  Gambling, betting, and lotteries.
10.735-211  Activities relating to private organizations and politics.
10.735-212  Wearing of uniforms.
10.735-213  Recommendations for employment.
10.735-214  Transmitting communications and gifts.
10.735-215  General conduct prejudicial to the Government.
10.735-216  Miscellaneous statutory provisions.
10.735-217  Requesting exceptions from certain statutory prohibitions.

  Subpart C--Ethical and Other Conduct and Responsibilities of Special 
                          Government Employees

10.735-301  Conflicts of interest.
10.735-302  Use of Government employment.
10.735-303  Use of inside information.
10.735-304  Coercion.
10.735-305  Gifts, entertainment, and favors.
10.735-306  Miscellaneous statutory provisions.

       Subpart D--Statements of Employment and Financial Interests

Sec.
10.735-401  Employees required to submit statements.
10.735-402  Employees not required to submit statements.
10.735-403  Employee's complaint on filing requirement.
10.735-404  Time and place of submission, and forms.
10.735-405  Information required.
10.735-406  Submission of position description.
10.735-407  Supplementary statements.
10.735-408  Review of statements and determination as to conflicts of 
          interest.
10.735-409  Confidentiality of employees' statements.
10.735-410  Effect of employees' statements on other requirements.
10.735-411  Disqualification procedures.

    Authority:  EO 11222 of May 8, 1965, as amended; 5 CFR 735.104.

    Source:  43 FR 18976, May 2, 1978, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 10.735-101  Purpose.

    The maintenance of the highest standards of honesty, integrity, 
impartiality, and conduct by Government employees and special Government 
employees is essential to assure the proper performance of the 
Government business and the maintenance of confidence by citizens in 
their Government. The avoidance of misconduct and conflicts of interest 
on the part of Government employees and special Government employees 
through informed judgment is indispensable to the maintenance of these 
standards. To accord with these concepts the regulations in this part 
prescribe standards of conduct and responsibilities for employees and 
special Government employees and require statements reporting employment 
and financial interests.

    Note: These regulations are codified in State 3 FAM 620, AID 
Handbook 24, and ICA MOA V-A 550.



Sec. 10.735-102  Definitions.

    (a) Agency means the Department of State (State), the Agency for 
International Development (AID), and the International Communication 
Agency (ICA).
    (b) Employee means an officer or employee at home or abroad, of an 
agency named in paragraph (a) of this section,

[[Page 47]]

but does not include a special Government employee or a member of the 
Army, Navy, Air Force, Marine Corps, Coast Guard, National Oceanic and 
Atmospheric Administration, or Public Health Service.
    (c) Executive order means Executive Order 11222 of May 8, 1965, as 
amended.
    (d) Person means an individual, a corporation, a company, an 
association, a firm, a partnership, a society, a joint stock company, or 
any other organization or institution.
    (e) Special Government employee means an officer or employee of an 
agency who is retained, designated, appointed, or employed to perform, 
with or without compensation, for not to exceed 130 days during any 
period of 365 consecutive days, temporary duties either on a full-time 
or intermittent basis.
    (f) Member of an employee's family means a spouse, minor child, or 
other member of an employee's immediate household. For the purpose of 
these regulations ``member of an employee's immediate or in-law 
household'' means those blood relations who are residents of the 
employee's household.
    (g) Counselor means the agency's Counselor on Ethical Conduct and 
Conflicts of Interest.



Sec. 10.735-103  Interpretation and advisory service.

    (a) Counseling services on employee responsibilities and conduct are 
available in each agency. These services are to be coordinated by a 
Counselor appointed by the agency head. The Counselors are for State: 
The Legal Adviser; for AID: The Deputy General Counsel; and for ICA: The 
General Counsel. The Counselor serves as the agency's designee to the 
Civil Service Commission on matters covered by the regulations in this 
part and is responsible for coordination of the agency's counseling 
services under paragraph (b) of this section and for assuring that 
counseling and interpretations on questions of conflicts of interest and 
other matters covered by these sections are available to deputy 
counselors designated under paragraph (b) of this section.
    (b) Each agency head may designate deputy counselors for the 
agency's employees and special Government employees. Deputy Counselors 
designated under this section must be qualified and in a position to 
give authoritative advice and guidance to each employee and special 
Government employee who seeks advice and guidance on questions of 
conflicts of interest and on other matters covered by the regulations in 
this part. A Washington employee or special Government employee should 
address any inquiries concerning the regulations in this part to the 
Counselor. At missions abroad the chief of each agency's establishment 
designates an officer, preferably the legal officer where one is 
available, to provide counseling services under the guidance of the 
Counselor; a single officer may serve all agencies. An employee or 
special Government employee serving abroad should submit inquiries to 
the officer designated.
    (c) Each agency shall periodically notify its employees and special 
Government employees of the availability of counseling services and how 
and when these services are available. A new employee or special 
Government employee shall be notified at the time of entrance on duty.



Sec. 10.735-104  Applicability to detailed employees.

    All the regulations of subparts A, B, and D of this part are 
applicable to an employee of another U.S. Government agency who may be 
serving on detail or assignment, formally or informally, on a 
reimbursable or nonreimbursable basis through a Participating Agency 
Service Agreement or otherwise, with an agency named in Sec. 10.735-
102(a). However, disciplinary action shall be taken against such an 
employee only by the employing agency.



Sec. 10.735-105  Disciplinary action.

    A violation of the regulations in this part by an employee or 
special Government employee may be cause for appropriate disciplinary 
action, including separation for cause, which may be in addition to any 
penalty prescribed by law.

[[Page 48]]



 Subpart B--Ethical and Other Conduct and Responsibilities of Employees



Sec. 10.735-201  General.

    (a) Proscribed actions. An employee shall avoid any action, whether 
or not specifically prohibited by the regulations in this part, which 
might result in, or create the appearance of:
    (1) Using public office for private gain;
    (2) Giving preferential treatment to any person;
    (3) Impeding Government efficiency or economy;
    (4) Losing independence or impartiality;
    (5) Making a Government decision outside official channels; or
    (6) Affecting adversely the confidence of the public in the 
integrity of the Government.
    (b) Applicability to members of families of employees. A U.S. 
citizen employee shall take care that certain responsibilities placed on 
the employee are also observed by members of the employee's family. 
These are the restrictions in regard to: Acceptance of gifts 
(Secs. 10.735-202 and 10.735-203); economic and financial activities 
abroad (Sec. 10.735-206); teaching, lecturing, and writing (Sec. 10.735-
204(c)); participation in activities of private organizations 
(Sec. 10.735-211(c)); and political activities abroad (Sec. 10.735-
211(g)).



Sec. 10.735-202  Gifts, entertainment, and favors.

    (a) Acceptance prohibited. Except as provided in paragraphs (b), 
(c), and (d) of this section, an employee shall not solicit or accept, 
directly or indirectly, any gift, gratuity, favor, entertainment, loan, 
or any other thing of monetary value, from a person who:
    (1) Has, or is seeking to obtain, contractual or other business or 
financial relations with the employee's agency;
    (2) Conducts operations or activities that are regulated by the 
employee's agency;
    (3) Has interests that may be substantially affected by the 
performance or nonperformance of the employee's official duty; or
    (4) Appears to be offering the gift with the hope or expectation of 
obtaining advantage or preferment in dealing with the U.S. Government 
for any purpose.
    (b) Acceptance permitted. The provisions of paragraph (a) of this 
section do not apply to:
    (1) Gifts, gratuities, favors, entertainments, loans, or any other 
thing of monetary value received on account of close family or personal 
relationships when the circumstances make it clear that it is that 
relationship rather than the business of the persons concerned which is 
the motivating factor;
    (2) Acceptance of loans from banks or other financial institutions 
on customary terms to finance proper and usual activities of employees, 
such as home mortgage loans;
    (3) Acceptance of unsolicited advertising or promotional material, 
such as pens, pencils, note pads, calendars, and other items of nominal 
intrinsic value;
    (4) Acceptance of rates and discounts offered to employees as a 
class.
    (c) Acceptance permitted for State and ICA employees. For State and 
ICA employees the provisions of paragraph (a) of this section do not 
apply to: Acceptance of food and refreshments of nominal value on 
infrequent occasions in the ordinary course of a luncheon or dinner 
meeting or other meeting or on an inspection tour where an employee may 
properly be in attendance.
    (d) Acceptance permitted for AID employees. For AID employees the 
provisions of paragraph (a) of this section do not apply in the 
following situations:
    (1) Acceptance of food, refreshments, or entertainment of nominal 
value on infrequent occasions offered in the ordinary course of 
luncheons, dinners, or other meetings and gatherings hosted by foreign 
governments or agencies and officials thereof, embassies, and 
international organizations, where the primary purpose of the function 
is representational or social, rather than the transaction of business. 
Where the primary purpose of the function is the transaction of 
business, acceptance is not permitted, except if there is justification 
and reporting in accordance with paragraph (d)(4) of this section.
    (2) Participation in widely attended lunches, dinners, and similar 
gatherings sponsored by industrial, technical, and professional 
associations for the

[[Page 49]]

discussion of matters of mutual interest to Government and industry.
    (3) Acceptance of food, refreshments, or entertainment in the 
unusual situation where the employee, by virtue of the location of the 
person, firm, corporation, or other entity, or the regulations governing 
its dining facilities, finds it inconvenient or impracticable not to 
accept the offer. Each case of acceptance shall be reported in 
accordance with the requirement of paragraph (d)(4) of this section. In 
no other case shall employees accept food, refreshments, or 
entertainment from private corporations, entities, firms, or individual 
contractors at occasions which are other than widely attended functions 
whose purposes are unrelated to Agency business.
    (4) In exceptional circumstances where acceptance of food, 
refreshments, or entertainment is not authorized by paragraphs (d) (1), 
(2), and (3) of this section, but where, in the judgment of the 
individual concerned, the Government's interest would be served by such 
acceptance directly or indirectly from any foreign government, agency, 
or official thereof or a private person, firm, corporation, or other 
entity which is engaged or is endeavoring to engage in business 
transactions of any sort with AID, an employee may accept the offer: 
Provided, That a report of the circumstances, together with the 
employee's statement as to how the Government's interests were served, 
will be made within 48 hours to the employee's supervisor, or, if the 
employee is serving abroad, or on temporary duty abroad, to the Mission 
Director.
    (e) Gifts to superiors. An employee shall for a gift to an official 
superior, make a donation as a gift to an official superior, or accept a 
gift from an employee receiving less pay than the employee (5 U.S.C. 
7351). However, this paragraph does not prohibit a voluntary gift of 
nominal value or donation in a nominal amount made on a special occasion 
such as marriage, illness, or retirement.
    (f) Neither this section nor Sec. 10.735-204 precludes an employee 
from receipt of bona fide reimbursement, unless prohibited by law, for 
expenses of travel and such other necessary subsistence as is compatible 
with this part for which no Government payment or reimbursement is made. 
However, this paragraph does not allow an employee to be reimbursed, or 
payment to be made on the employee's behalf, for excessive personal 
living expenses, gifts, entertainment, or other personal benefits, nor 
does it allow an employee to be reimbursed by a person for travel on 
official business under agency orders when reimbursement is proscribed 
by Decision B-128527 of the Comptroller General dated March 7, 1967.



Sec. 10.735-203  Gifts from foreign governments.

    An employee shall not accept a gift, present, decoration, or other 
thing from a foreign government unless authorized by Congress as 
provided by the Constitution and in 5 U.S.C. 7342, and the regulations 
promulgated thereunder pursuant to E.O. 11320, 31 FR 15789. These 
regulations are set forth in part 3 of this title (as added, 32 FR 6569, 
Apr. 28, 1967), and in 3 FAM 621.



Sec. 10.735-204  Outside employment and other activity.

    (a) An employee shall not engage in outside employment or other 
outside activity not compatible with the full and proper discharge of 
the duties and responsibilities of Government employment. Incompatible 
activities include but are not limited to:
    (1) Acceptance of a fee, compensation, gift, payment of expense, or 
any other thing of monetary value in circumstances in which acceptance 
may result in, or create the appearance of, conflicts of interest; or
    (2) Outside employment which tends to impair the employee's mental 
or physical capacity to perform Government duties and responsibilities 
in an acceptable manner.
    (b) An employee shall not receive any salary or anything of monetary 
value from a private source as compensation for the employee's services 
to the Government (18 U.S.C. 209).
    (c) Employees are encouraged to engage in teaching, lecturing, and 
writing that is not prohibited by law, the Executive order, this part, 
or the agency regulations. However, an employee

[[Page 50]]

shall not, either for or without compensation, engage in teaching, 
lecturing, or writing including teaching, lecturing, or writing for the 
purpose of the special preparation of a person or class of persons for 
an examination of the Civil Service Commission or Board of Examiners for 
the Foreign Service, that is dependent on information obtained as a 
result of Government employment, except when that information has been 
made available to the general public or will be made available on 
request or when the agency head gives written authorization for use of 
nonpublic information on the basis that the use is in the public 
interest. In addition, an employee who is a Presidential appointee 
covered by section 401(a) of the Executive order shall not receive 
compensation or anything of monetary value for any consultation, 
lecture, discussion, writing, or appearance the subject matter of which 
is devoted substantially to the responsibilities, programs, or 
operations of the employee's agency, or which draws substantially on 
official data or ideas which have not become part of the body of public 
information. Employees are referred to the detailed rules of their 
agency with respect to clearance and acceptance of compensation (3 FAM 
628; for AID see Handbook 18).
    (d) [Reserved]
    (e) An employee shall not render any services, whether or not 
compensated, to any foreign government, state, province, or 
semigovernmental agency, or municipality of any foreign government, or 
to any international organization of states. However, this shall not 
prevent the rendering of such services by employees acting on behalf of 
the United States. Nor shall this provision prevent the rendering of 
services to an international organization of states when otherwise 
consistent with law and when authorized by the appropriate officer. The 
appropriate officer for State is the Director General and Director of 
Personnel; for AID the Assistant Administrator for Program and 
Management Services; and for ICA the Director of Personnel Services.
    (f) [Reserved]
    (g) This section does not preclude an employee from:
    (1) Participation in the activities of national or State political 
parties not proscribed by law.
    (2) Participation in the affairs of or acceptance of an award for a 
meritorious public contribution or achievement given by a charitable, 
religious, professional, social, fraternal, nonprofit educational and 
recreational, public service, or civic organization.



Sec. 10.735-205  Financial interests.

    (a) An employee shall not: (1) Have a direct or indirect financial 
interest that conflicts substantially, or appears to conflict 
substantially with the employee's Government duties and 
responsibilities; or
    (2) Engage in, directly or indirectly, a financial transaction as a 
result of, or primarily relying on, information obtained through 
Government employment.
    (b) This section does not preclude an employee from having a 
financial interest or engaging in financial transactions to the same 
extent as a private citizen not employed by the Government so long as it 
is not prohibited by law or the regulations in this part.
    (c) Pursuant to the provision of 18 U.S.C. 208(b) the following 
described financial interests of an employee are hereby exempted from 
the requirements of 18 U.S.C. 208(a) and 208(b)(1) as being too remote 
or too inconsequential to affect the integrity of the services of an 
employee. The exemption applies to the financial interests held directly 
by an employee, by the employee's spouse or minor child whether 
individually or jointly with the employee, or by an employee and any 
partner or partners as joint assets of the partnership:
    (1) Investments in State and local government bonds; and stocks, 
bonds, or policies in a mutual fund, investment company, bank or 
insurance company, provided that in the case of a mutual fund, 
investment company, or bank, the fair value of such stock or bond 
holding does not exceed one percent of the value of the reported assets 
of the mutual fund, investment company, or bank. In the case of a mutual 
fund or investment company, this exemption applies only where the assets 
of the fund or company are diversified;

[[Page 51]]

it does not apply where the fund or company specializes in a particular 
industry or commodity.
    (2) Interest in an investment club or other group organized for the 
purpose of investing in equity or debt securities: Provided, That the 
fair value of the interest involved does not exceed $10,000 and that the 
interest does not exceed one-fourth of the total assets of the 
investment club or group. Where an employee covered by this exemption is 
a member of a group organized for the purpose of investing in equity or 
debt securities, the interest of the employee in any enterprise in which 
the group holds securities shall be based upon the employee's equity 
share of the holdings of the group in that enterprise.
    (3) If an employee, or the employee's spouse or minor child has a 
present beneficial interest or a vested remainder interest under a 
trust, the ownership of stocks, bonds, or other corporate securities 
under the trust will be exempt to the same extent as provided in 
paragraphs (c)(1) and (2) of this section for the direct ownership of 
such securities. The ownership of bonds other than corporate bonds, or 
of shares in a mutual fund or regulated investment company, under the 
trust will be equally exempt and to the same extent as under paragraphs 
(c) (1) and (2) of this section.
    (4) If an employee is an officer, director, trustee, or employee of 
an educational institution, or if the employee is negotiating for, or 
has an arrangement concerning prospective employment with such an 
institution, a direct financial interest which the institution has in 
any matter will not itself be exempt, but any financial interest that 
the institution may have in the matter through its holdings of 
securities issued by business entities will be exempt: Provided, The 
employee is not serving as a member of the investment committee of the 
institution or is not otherwise advising it on its investment portfolio.
    (5) An employee may continue to participate in a bona fide pension, 
retirement, group life, health or accident insurance plan, or other 
employee welfare or benefit plan that is maintained by a business or 
nonprofit organization by which the employee was formerly employed. Such 
financial interest in that organization will be exempt, except to the 
extent that the welfare or benefit plan is a profit-sharing or stock-
bonus plan and the employee's financial interest thereunder exceeds 
$10,000. This exemption extends also to any financial interests that the 
organization may have in other business activities.
    (d) Nothing in this part shall be deemed to prohibit an employee 
from acting, with or without compensation, as agent or attorney for the 
employee's parents, spouse, child, or any person for whom, or for any 
estate for which, the employee is serving as guardian, executor, 
administrator, trustee, or other personal fiduciary, except in those 
matters in which the employee has participated personally and 
substantially as a Government employee, through decision, approval, 
disapproval, recommendation, the rendering of advice, investigation, or 
otherwise, or which are the subject of the employee's official 
responsibility, as defined in 18 U.S.C. 202(b): Provided, The head of 
the employee's division approves in writing.



Sec. 10.735-206  Economic and financial activities of employees abroad.

    (a) Prohibitions in any foreign country. A U.S. citizen employee 
abroad is specifically prohibited from engaging in the activities listed 
below in any foreign country.
    (1) Speculation in currency exchange.
    (2) Transactions at exchange rates differing from local legally 
available rates, unless such transactions are duly authorized in advance 
by the agency.
    (3) Sales to unauthorized persons (whether at cost or for profit) of 
currency acquired at preferential rates through diplomatic or other 
restricted arrangements.
    (4) Transactions which entail the use, without official sanction, of 
the diplomatic pouch.
    (5) Transfers of funds on behalf of blocked nationals, or otherwise 
in violation of U.S. foreign funds and assets control.
    (6) Independent and unsanctioned private transactions which involve 
an employee as an individual in violation of

[[Page 52]]

applicable control regulations of foreign governments.
    (7) Acting as a intermediary in the transfer of private funds from 
persons in one country to persons in another country, including the 
United States.
    (8) Permitting use of one's official title in any private business 
transactions or in advertisements for business purposes.
    (b) Prohibitions in country of assignment. (1) A U.S. citizen 
employee shall not transact or be interested in any business or engage 
for profit in any profession or undertake other gainful employment in 
any country or countries to which the employee is assigned or detailed 
in the employee's own name or through the agency of any other person; 
exceptions may be made with respect to chiefs of mission only in writing 
by the Deputy Under Secretary for Management and for all other State 
employees by the appropriate chief of mission; for AID employees by the 
assistant administrator of the regional bureau or head of the 
nonregional organization, as appropriate; and for ICA employees by the 
Director of Personnel Services, or their designees (see 22 U.S.C. 805).
    (2) A U.S. citizen employee shall not invest in real estate or 
mortgages on properties located in the employee's country of assignment. 
The purchase of a house and land for personal occupancy is not 
considered a violation of this paragraph.
    (3) A U.S. citizen employee shall not invest money in bonds, shares 
or stocks of commercial concerns headquartered in the country of 
assignment or conducting a substantial portion of their business in such 
country. Such investments, if made prior to knowledge of assignment or 
detail to such country or countries, may be retained during such 
assignment or detail when approved in writing by the appropriate 
official named in paragraph (b)(1) of this section. If retention is 
authorized, such stocks, shares, or bonds may not be sold while the 
employee is assigned or detailed to the country or countries, unless the 
agency approved the sale in writing.
    (4) A U.S. citizen employee shall not sell or dispose of personal 
property, including automobiles, at prices producing profits to the 
employee which result primarily from import privileges derived from the 
employee's official status as an employee of the U.S. Government. 
Employees of State and ICA are referred to Foreign Affairs Manual 
Circular 378; for AID see Handbook 23, Attachment 1B.
    (c) Acceptance of employment by members of family abroad. Family 
members of Foreign Service personnel may accept gainful employment in a 
foreign country unless such employment (1) would violate any law of such 
country or of the U.S.; or (2) could damage the interests of the U.S., 
as certified in writing to the family member by the Chief of the U.S. 
Diplomatic Mission in such country. A copy of such certification will be 
sent to the Family Liaison Office (M/FLO), Department of State. Family 
members accepting employment abroad should bear in mind that they may 
not enjoy immunity from judicial process and would be subject to the 
payment to taxes derived from their nondiplomatic employment.
    (d) Business activities of non-U.S. citizen employees. A non-U.S 
citizen employee abroad may engage in outside business activities with 
the prior approval of the head of the overseas establishment on the 
basis of the standards expressed in Sec. 10.735-204(a).



Sec. 10.735-207  Use of Government property.

    An employee shall not directly or indirectly use, or allow the use 
of Government property of any kind, including property leased to the 
Government, for other than officially approved activities. An employee 
has a positive duty to protect and conserve Government property, 
including equipment, supplies, and other property entrusted or issued to 
the employee.



Sec. 10.735-208  Misuse of information.

    For the purpose of furthering a private interest, an employee shall 
not, except as provided in Sec. 10.735-204(c) directly or indirectly 
use, or allow the use of, official information obtained through or in 
connection with Government employment which has not been made available 
to the general public.

[[Page 53]]



Sec. 10.735-209  Indebtedness.

    An employee shall pay each just financial obligation in a proper and 
timely manner, especially one imposed by law such as Federal, State, or 
local taxes. For the purpose of this section, a ``just financial 
obligation'' means one acknowledged by the employee or reduced to 
judgement by a court or one imposed by law such as Federal, State, or 
local taxes, and ``in a proper and timely manner'' means in a manner 
which the agency determines does not, under the circumstances, reflect 
adversely on the Government as the employer. In the event of 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.



Sec. 10.735-210  Gambling, betting, and lotteries.

    An employee shall not participate, while on Government-owned or 
leased property or while on duty for the Government, in any gambling 
activity including the operation of a gambling device, in conducting a 
lottery or pool, in a game for money or property, or in selling or 
purchasing a numbers slip or ticket. However, this section does not 
preclude activities:
    (a) Necessitated by an employee's law enforcement duties; or
    (b) Under section 3 of Executive Order 10927 and similar agency-
approved activities.



Sec. 10.735-211  Activities relating to private organizations and politics.

    (a) Definition. For the purpose of this section, the term private 
organization denotes any group of persons or associations organized for 
any purpose whatever, except an organization established by the 
Government of the United States, or officially participated in by State, 
AID, or ICA.
    (b) Participation in activities of employee organizations. An 
employee may join or refrain from joining employee organizations or 
associations without interference, coercion, restraint, or fear of 
discrimination or reprisal.
    (c) Participation in activities of private organizations. In 
participating in the program and activities of any private organization, 
an employee shall make clear that the employee's agency has no official 
connection with such organization and does not necessarily sponsor or 
sanction the viewpoints which it may express.
    (d) Legal restrictions on membership in certain organizations. An 
employee shall not have membership in any organization that advocates 
the overthrow of our constitutional form of Government in the United 
States, knowing that such organization so advocates (5 U.S.C. 7311, 18 
U.S.C. 1918).
    (e) Private organizations concerned with foreign policy or other 
matters of concern to agencies. (1) Limitation on participation. When a 
private organization is concerned primarily with foreign policy or 
international relations or other matters of concern to an employee's 
agency, an employee shall limit connection therewith as follows: Unless 
specifically permitted to do so, the employee may not serve as advisor, 
officer, director, teacher, sponsor, committee chairman, or in any other 
official capacity or permit the employee's name to be used on a 
letterhead, in a publication, in an announcement or news story, or at a 
public meeting, regardless of whether the employee's official title or 
connection is mentioned. The provisions of this section are not intended 
to prohibit the normal and active participation of an employee in 
professional organizations such as the American Political Science 
Association, the American Economic Association, the American Foreign 
Service Association, and similar organizations, since such participation 
is in the interest of both the employee and the Government. Employees 
are expected, however, to exercise discretion in such activities and are 
held personally accountable for any improper use of their relationship 
with State, AID, and ICA.
    (2) Request for special permission. Special permission to assume or 
continue a connection prohibited by paragraph (e)(1) of this section may 
be granted in cases where the public interest will not be adversely 
affected. To request such permission, or to determine whether the 
provisions are applicable to a particular case, the employee shall 
address a memorandum setting forth all of the circumstances

[[Page 54]]

to the appropriate officer. The appropriate officer is for State, the 
Director General and Director of Personnel; for AID, the Senior 
Personnel Officer under whose jurisdiction the employee serves; and for 
ICA, the Director of Personnel Services.
    (3) Application to senior officers. Because of the prominence 
resulting from their official positions, chiefs of mission and other 
senior officers should recognize the particular bearing of the 
provisions of paragraph (e)(1) of this section upon their activities. 
They should restrict association with any organizations involving 
foreign nations and the United States to simple membership and should 
not accept even honorary office in such organizations except with the 
specific prior approval as provided in paragraph (e)(2) of this section.
    (f) Private organizations not concerned with foreign policy. When 
the purpose and program of the organization do not fall primarily within 
the field of foreign policy or international relations, the employee's 
activity is limited only to the following extent:
    (1) The employee's official title or connection may be used to 
identify the employee, as in a civic association election, but may not 
be used on a letterhead, in a publication, or otherwise so as to employ 
the prestige of the U.S. Government to enhance that of the organization 
or to imply official sponsorship.
    (2) When the employee is a representative of an association 
consisting of State, AID, or ICA employees, or of a group of such 
employees, the employee's connection with the agency may be freely used 
so long as there is no implication of official sponsorship beyond that 
which may have been officially approved.
    (g) Political activities abroad. A U.S. citizen employee shall not 
engage in any form of political activity in any foreign country.
    (h) Activities relating to U.S. politics. The law (5 U.S.C. 7324, 
formerly the Hatch Act) provides in summary that it is unlawful for any 
Federal employee of the executive branch to use the employee's official 
authority or influence for the purpose of interfering with an election 
or affecting the result thereof, or to take any active part in political 
management or in political campaigns. These restrictions do not in any 
way affect the right of a Federal employee (1) to vote as the employee 
chooses; (2) to express personal political opinions, except as part of a 
campaign; (3) to make or refrain from making contributions to political 
organizations, provided contributions are not made in a Federal building 
or to another Federal officer or employee (see 18 U.S.C. 602, 603, 607, 
and 608); (4) to participate in local, nonpartisan activities.



Sec. 10.735-212  Wearing of uniforms.

    (a) An employee of the Foreign Service may not wear any uniform 
except as may be authorized by law or as a military commander may 
require civilians to wear in a theater of military operations (22 U.S.C. 
803). When an employee is authorized by law or required by a military 
commander of the United States to wear a uniform, care shall be taken 
that the uniform is worn only at authorized times and for authorized 
purposes.
    (b) Conventional attire worn by chauffeurs, elevator operators, and 
other miscellaneous employees are not considered uniforms within the 
meaning of this section except that, for ICA, MOA VII 917.2b prohibits 
the purchase from Agency funds of uniforms or any item of personal 
wearing apparel other than special protective clothing.



Sec. 10.735-213  Recommendations for employment.

    (a) Making recommendations in official capacity. In general, an 
employee shall not, in the employee's official capacity, make any 
recommendations in connection with the employment of persons unless the 
position concerned are with the Government of the United States and the 
recommendations are made in response to an inquiry from a Government 
official authorized to employ persons or to investigate applicants for 
employment. A principal officer in answer to a letter of inquiry from 
outside the U.S. Government concerning a former employee assigned to the 
post, may state the length of time the person was employed at the post 
and the fact that the former employee

[[Page 55]]

performed duties in a satisfactory manner, if such is the case. Also, an 
AID Mission Director may provide names of persons or firms from which a 
cooperating government may select an employee or firm to be used in some 
phase of the AID program.
    (b) Making personal recommendations. An employee may make a personal 
recommendation in connection with the employment of any person, 
including present or former employees, their spouses and/or members of 
their families, except for employment in a position of trust or profit 
under the government of the country to which the employee is accredited 
or assigned (22 U.S.C. 806(b)): Provided, That the employee does not 
divulge any information concerning the person derived from official 
sources. When a letter of introduction or recommendation is written by 
an employee, precautionary measures should be taken to prevent its being 
construed as official correspondence and used by an unscrupulous 
individual to impress American or foreign officials. Accordingly, 
official stationery should not be used for this purpose. The letter may, 
however, show the recommending employee's status as an employee of the 
U. S. Government. Every personal letter of recommendation shall contain 
a statement clearly indicating that the letter constitutes a personal 
recommendation and is not to be construed as an official recommendation 
by the Government of the United States.



Sec. 10.735-214  Transmitting communications and gifts.

    (a) Correspondence. In corresponding with anyone other than the 
proper official of the United States with regard to the public affairs 
of a foreign government, an employee shall use discretion and judgment 
to ensure that neither the United States nor the employee will be 
embarrassed or placed in a compromising position (22 U.S.C. 806(a)).
    (b) Communications. An employee shall not act as an agent for the 
transmission of communications from private persons or organizations in 
foreign countries to the President or to Federal, State, or municipal 
officials in the United States. A chief of mission may, however, accept 
communications of this nature and forward them to the Department of 
State for such further action as may be appropriate, whenever the chief 
of mission determines it to be clearly in the public interest to do so.
    (c) Gifts. An employee shall not act as an agent for the 
transmission of gifts from persons or organizations in foreign countries 
to the President or to Federal, State, or municipal officials of the 
United States. However, principal officers may, according to regulations 
prescribed by the President, accept, and forward to the Office of 
Protocol of the Department of State, gifts made to the United States or 
to any political subdivision thereof by the Government to which they are 
accredited or from which they hold exequaturs. Employees shall not, 
without the approval of the Secretary of State, transmit gifts from 
persons or organizations in the United States to heads or other 
officials of foreign states.



Sec. 10.735-215  General conduct prejudicial to the Government.

    (a) An employee shall not engage in criminal, infamous, dishonest, 
immoral, or notoriously disgraceful conduct, or other conduct 
prejudicial to the Government.
    (b) An employee abroad is also obligated to obey the laws of the 
country in which the employee is present.
    (c) An employee shall observe the requirements of courtesy, 
consideration, and promptness in dealing with or serving the public.



Sec. 10.735-216  Miscellaneous statutory provisions.

    Each employee shall become acquainted with each statute that relates 
to the employee's ethical and other conduct as an agency employee of and 
of the Government.
    (a) The attention of employees is directed to the following 
statutory provisions:
    (1) House Concurrent Resolution 175, 85th Congress, 2d session, 72 
Stat. B12, the ``Code of Ethics for Government Service.''
    (2) Chapter 11 of title 18, United States Code, relating to bribery, 
graft, and conflicts of interest, as appropriate to the employees 
concerned.

[[Page 56]]

    (3) The prohibition against lobbying with appropriated funds (18 
U.S.C. 1913).
    (4) The prohibitions against disloyalty and striking (5 U.S.C. 7311, 
18 U.S.C. 1918). 1
---------------------------------------------------------------------------


    1 The Courts have stricken from the Code any prohibition 
against assertion of the right to strike on the basis that such an 
assertion is a protected right under the First Amendment to the 
Constitution.
---------------------------------------------------------------------------

    (5) The prohibitions against (i) the disclosure of classified 
information (18 U.S.C. 798, 50 U.S.C. 783); and (ii) the disclosure of 
confidential information (18 U.S.C. 1905).
    (6) The provision relating to the habitual use of intoxicants to 
excess (5 U.S.C. 7352).
    (7) The prohibition against the misuse of a Government vehicle (31 
U.S.C. 638a(c)).
    (8) The prohibition against the misuse of the franking privilege (18 
U.S.C. 1719).
    (9) The prohibition against the use of deceit in an examination or 
personnel action in connection with Government employment (18 U.S.C. 
1917).
    (10) The prohibition against fraud or false statements in a 
Government matter (18 U.S.C. 1001).
    (11) The prohibition against mutilating or destroying a public 
record (18 U.S.C. 2071).
    (12) The prohibition against counterfeiting and forging 
transportation requests (18 U.S.C. 508).
    (13) The prohibition against (i) embezzlement of Government money or 
property (18 U.S.C. 641); (ii) failing to account for public money (18 
U.S.C. 643); and (iii) embezzlement of the money or property of another 
person in the possession of an employee by reason of the employee's 
employment (18 U.S.C. 654).
    (14) The prohibition against unauthorized use of documents relating 
to claims from or by the Government (18 U.S.C. 285).
    (15) The prohibition against political activities in subchapter III 
of chapter 73 of title 5, United States Code and 18 U.S.C. 602, 603, 
607, and 608.
    (16) The prohibition against an employee acting as the agent of a 
foreign principal registered under the Foreign Agents Registration Act 
(18 U.S.C. 219).
    (17) The prohibition against discrimination because of politics, 
race, religion, or color (22 U.S.C. 807).
    (18) The prohibition against officers or employees accepting any 
honorarium in excess of $2,000 or honoraria aggregating more than 
$25,000 in any calendar year (sec. 112, Pub. L. 94-283, 90 Stat. 494 (2 
U.S.C. 441i)).
    (b) The attention of consular officers is directed to the following 
statutory provisions:
    (1) The provisions relating to the duty to account for fees received 
(22 U.S.C. 9, 812, 1194), liability for exaction of excessive fees (22 
U.S.C. 1182, 1189), and liability for failure to collect proper fees (22 
U.S.C. 1190).
    (2) The provisions relating to liability for failure to give bond 
and for embezzlement (22 U.S.C. 1179), liability for embezzlement of 
fees or effects of American citizens (22 U.S.C. 1198), and liability for 
falsely certifying as to the ownership of property (22 U.S.C. 1200).
    (3) The prohibition against profiting from dealings with discharged 
seamen (22 U.S.C. 1187).
    (4) The provision relating to liability for failure to collect the 
wages of discharged seamen (46 U.S.C. 683).



Sec. 10.735-217  Requesting exceptions from certain statutory prohibitions.

    (a) Any employee desiring a written advance determination that the 
prohibitions of 18 U.S.C. 208(a) do not apply will prepare a written 
request addressed to an appropriate agency official. For purposes of 
this section, the appropriate agency official is: The Deputy Under 
Secretary for Management for State, the Administrator for AID, and the 
Director for ICA. The request will describe the particular matter giving 
rise to the conflict of interest, the nature and extent of the 
employee's anticipated participation in the particular matter, and the 
exact nature and amount of the financial interest related to the 
particular matter.
    (b) The employee will forward the request to the appropriate agency 
official through the immediate supervisor and the assistant agency head 
in charge of the organizational agency component to which the employee 
is assigned, or will be assigned in the case of a new employee. The 
assistant agency head

[[Page 57]]

will forward the written request to the appropriate agency official 
through the agency's Counselor. The Counselor shall attach a written 
opinion to the request, prepare a recommended written determination in 
final form for signature by the appropriate agency official, and shall 
forward all documents to that official.
    (c) The determination of the appropriate agency official will be 
sent to the employee by the Counselor. If the appropriate agency 
official grants the requested exception, the original written advance 
determination will be sent to the employee. A duplicate original shall 
be retained among the appropriate agency records under the control of 
the Counselor.



  Subpart C--Ethical and Other Conduct and Responsibilities of Special 
                          Government Employees



Sec. 10.735-301  Conflicts of interest.

    Special Government employees are subject to the conflicts of 
interest statutes (18 U.S.C. 202). An explanation of these conflicts of 
interest statutes their effects upon special Government employees and 
guidelines for obtaining and utilizing the services of special 
Government employees are in appendix C of chapter 735 of the Federal 
Personnel Manual. A special Government employee shall not have a direct 
or indirect financial interest that conflicts substantially, or appears 
to conflict substantially, with Government duties and responsibilities.



Sec. 10.735-302  Use of Government employment.

    A special Government employee shall not use Government employment 
for a purpose that is, or gives the appearance of being, motivated by 
the desire for private gain for the employee or another person, 
particularly one with whom the employee has family, business, or 
financial ties.



Sec. 10.735-303  Use of inside information.

    (a) A special Government employee shall not use inside information 
obtained as a result of Government employment for private gain for the 
employee or another person either by direct action on the employee's 
part or by counsel, recommendation, or suggestion to another person, 
particularly one with whom the employee has family, business, or 
financial ties. For the purpose of this section, ``inside information'' 
means information obtained under Government authority which has not 
become part of the body of public information.
    (b) A special Government employee may engage in teaching, lecturing, 
or writing that is not prohibited by law, Executive Order 11222 or the 
restrictions in this part; however, a special Government employee shall 
not, either for or without compensation, engage in teaching, lecturing, 
or writing that is dependent on information obtained as a result of his 
Government employment, except when that information has been made 
available to the general public or will be made available, or when the 
head of the agency gives written authoritzation for the use of nonpublic 
information on the basis that the use is in the public interest. A 
special Government employee who wishes to request the agency head to 
authorize the use of nonpublic information should submit such request 
through the Counselor. The request should contain complete information 
concerning the nonpublic information which the employee wishes to 
disclose and should contain in addition an indication of the intended 
use of such information and how disclosure of it would be in the public 
interest.



Sec. 10.735-304  Coercion.

    A special Government employee shall not use Government employment to 
coerce, or give the appearance of coercing, a person to provide 
financial benefit to the employee or another person, particularly one 
with whom the employee has family, business, or financial ties.



Sec. 10.735-305  Gifts, entertainment, and favors.

    (a) Except as provided in paragraph (b) of this section, a special 
Government employee, while so employed or in connection with Government 
employment, shall not receive or solicit from a person having business 
with the

[[Page 58]]

employee's agency anything of value as a gift, gratuity, loan, 
entertainment, or favor for the employee or another person, particularly 
one with whom the employee has family, business or financial ties.
    (b) The exceptions to the prohibition against the acceptance of 
gifts which have been granted to employees in Sec. 10.735-202 (b), (c), 
and (d) are also applicable to special Government employees.
    (c) A special Government employee shall not accept a gift, present, 
decoration, or other thing from a foreign government unless authorized 
by Congress as provided by the Constitution and in 5 U.S.C. 7342, and 
the regulations promulgated thereunder pursuant to E.O. 11320; 31 FR 
15789. These regulations are set forth in part 3 of this title (as 
added, 32 FR 6569, April 28, 1967), and in 3 FAM 621.
    (d) A special Government employee shall avoid any action, whether or 
not specifically prohibited by these sections on special Government 
employees, which might result in, or create the appearance of:
    (1) Using public office for private gain;
    (2) Giving preferential treatment to any person;
    (3) Impeding Government efficiency or economy;
    (4) Losing independence or impartiality;
    (5) Making a Government decision outside official channels; or
    (6) Affecting adversely the confidence of the public in the 
integrity of the Government.



Sec. 10.735-306  Miscellaneous statutory provisions.

    Each special Government employee shall become acquainted with each 
statute that relates to the employee's ethical and other conduct as a 
special Government employee of an agency and of the Government. The 
attention of special Government employees is directed to the statutes 
listed in Sec. 10.735-216.



       Subpart D--Statements of Employment and Financial Interests



Sec. 10.735-401  Employees required to submit statements.

    The following employees of State, AID, and ICA shall submit 
statements of employment and financial interests:
    (a) All special Government employees including experts or 
consultants serving on a full-time or intermittent basis, except when 
waived under Sec. 10.735-402(c).
    (b) Employees paid at a level of the Executive Schedule in 
subchapter II of chapter 53 of title 5, United States Code, except as 
provided in Sec. 10.735-402(b).
    (c) Except as provided in Sec. 10.735-402, employees classified at 
GS-13, FSO-4, FSR-5, FSS-2, AD-13, FC-5, or above, who are in positions 
hereby identified either as positions the basic duties of which impose 
upon the incumbent the responsibility for a Government decision or 
taking a Government action in regard to:
    (1) Contracting or procurement;
    (2) Administering or monitoring grants or subsidies;
    (3) Regulating or auditing private or other non-Federal enterprise;
    (4) Other activities where the decision or action has an economic 
impact on the interests of any non-Federal enterprise, or as positions 
which have duties and responsibilities which require the incumbent to 
report employment and financial interests in order to avoid involvement 
in a possible conflict of interest situation and carry out the purpose 
of law, Executive order, and the agency's regulations:

                                  State

    Director General of the Foreign Service and the Director of 
Personnel; Director of the Policy Planning Staff; Inspector General; 
Director, FSI; Special Assistant to Secretary; Deputy Secretary, Under 
Secretaries, or Deputy Under Secretary; Deputy Assistant Secretary and 
others at this level or above; Assistant Legal Adviser for Management; 
Director, Office of Operations; Office Director; Country Director; 
Division Chief in Bureau of Economic and Business Affairs, in the Office 
of Operations, (O/OPR), or in the

[[Page 59]]

Office of Foreign Buildings; Executive Director; Deputy Chief of 
Mission; Principal Officer; Economic Counselor; Commercial Counselor; 
Administrative Counselor; Civil Air Attache; Petroleum Officer; Minerals 
Officer; Contracting Specialist; Procurement Specialist; Despatch Agent; 
Traffic Manager; and Traffic Management Specialist.

                                   ICA

    Deputy Director, Associate Directors, Directors and Deputy Directors 
of Offices or Services, Executive or Special Assistants to the Director; 
Chief Inspector; Associate Chief Inspector; Commissioner General, Deputy 
Commissioner General, Staff Director (Advisory Commission), Director of 
Engineering and Technical Operations; Director of Audio-Visual 
Procurement and Production; Country Public Affairs Officer, Deputy 
Country Public Affairs Officer, Public Affairs Counselor, Deputy Public 
Affairs Counselor, Director or Manager of Regional Service Center, Radio 
Relay Station, Radio Program Center or Radio Relay Station Construction 
Site, Administrative Officer or Executive Officer at a post abroad, 
Administrative Officer, Executive Officer and Business Manager 
(occupational codes 301, 340, 341, and 1101, or FAS code 200); 
Contracting Specialist and Procurement Specialist (occupational code 
1102, or FAS codes 210 and 211); Auditor and Accountant (occupational 
code 510, or FAS code 207); General Counsel, Deputy General Counsel, or 
Attorney (occupational code 905, or FAS code 512).

                                   AID

    (1) AID/W: Deputy Assistant Administrators, Associate Assistant 
Administrators, Deputy Associate Assistant Administrators; Heads and 
Deputy Heads of Offices, Staffs, and Divisions; Desk Officers and Deputy 
Desk Officers.
    (2) Overseas: Mission Directors, Deputy Directors, Assistant 
Directors, AID Representatives, Aid Affairs Officers, Chairman, 
Development Assistance Committee; U.S. Representative to Development 
Assistance Committee; Development Coordination Officer.
    (3) Any person serving as chief of an operational branch responsible 
for housing, loans, guarantees, or other commercial type transactions 
with the public.
    (4) In addition, employees in AID/W or overseas whose positions fall 
within the following series or position titles (occupational code given 
in parenthesis): Economist Series (0110); International Cooperation 
Series (0136); Auditor General (0301.21); Supervisory Housing 
Development Officer (0301.31); Chief, Housing and Urban Development 
(0301.35); Contract Compliance Specialist (0301.48); Director for 
Regional Activities (0340.08); Development Officer (0340.09); Regional 
Development Officer (0340.10); Executive Officer (0341.01); Deputy 
Executive Officer (0341.02); Regional Executive Officer (0341.03); 
Administrative Officer (0341.05); Executive Officer--Administrative 
Support (0341.15); Executive Officer, Operations (0341.16); Executive 
Officer, Real Property (0341.18); Executive Officer, Personnel 
(0341.19); General Services Officer (0342.01); Assistant General 
Services Officer (0342.03); Assistant General Services Officer, Property 
and Supply (0342.20); Assistant General Services Officer, Procurement 
(0342.23); Assistant General Services Officer, Housing (0342.25); 
Program Officer (0345.01); Deputy Program Officer (0345.02); Food and 
Agriculture Officer (0401.01); Deputy Food and Agriculture Officer 
(0401.02); Budget and Accounting Series (0504); Financial Management 
Series (0505); Accounting Series (0510); Budget Administration Series 
(0560); General Attorney Series (0905); General Business and Industry 
Series (1101); Contract and Procurement Series (1102); Property Disposal 
Series (1104); Purchasing Series (1105); Trade Specialist Series (1140); 
Private Resources Development Series (1150); Financial Analysis Series 
(1160); General Investigating Series (1810); Criminal Investigating 
Series (1811); Import Specialist Series (1889); General Supply Series 
(2001); Supply Program Management Series (2003).



Sec. 10.735-402  Employees not required to submit statements.

    (a) Employees in positions that meet the criteria in paragraph (c) 
of Sec. 10.735-401 may be excluded from the reporting requirement when 
the agency head or designee determines that:
    (1) The duties of the position are such that the likelihood of the 
incumbent's involvement in a conflict-of-interest situation is remote;
    (2) The duties of the position are at such a level of responsibility 
that the submission of a statement of employment and financial interests 
is not necessary because of the degree of supervision and review over 
incumbent or the inconsequential effect on the integrity of the 
Government.
    (b) A statement of employment and financial interests is not 
required by the regulations in this part from an agency head, or a full-
time member of a committee, board, or commission appointed by the 
President. These employees are subject to separate reporting 
requirements under section 401 of Executive Order 11222.
    (c) Special Government employees not required to submit statements. 
An agency head may waive the requirement of this section for the 
submission

[[Page 60]]

of a statement of employment and financial interest in the case of a 
special Government employee who is not a consultant or an expert when 
the agency finds that the duties of the position held by that special 
Government employee are of a nature and at such a level of 
responsibility that the submission of the statement by the incumbent is 
not necessary to protect the integrity of the Government. For the 
purpose of this paragraph, ``consultant'' and ``expert'' have the 
meanings given those terms by chapter 304 of the Federal Personnel 
Manual, but do not include a physician, dentist, or allied medical 
specialist whose services are procured to provide care and service to 
patients.



Sec. 10.735-403  Employee's complaint on filing requirement.

    Each employee shall have the opportunity for review through agency 
grievance procedure of the employee's complaint that the employee's 
position has been improperly included within Sec. 10.735-401 as one 
requiring the submission of a statement of employment and financial 
interests. Employees are reminded that they may obtain counseling 
pursuant to Sec. 10.735-103 prior to filing a complaint.



Sec. 10.735-404  Time and place of submission, and forms.

    (a) An employee or special Government employee shall submit a 
statement to the Counselor (in the case of a State employee, through the 
employee's Bureau) no later than:
    (1) Ninety days after the effective date of this part if the 
employee has entered on duty on or before that effective date; or
    (2) At least 10 days prior to entrance on duty, if the employee 
enters on duty after that effective date; except that an employee or 
special Government employee who enters on duty within 90 days of the 
effective date of this part may submit such statement within 90 days 
after entrance on duty.
    (b) Only the original of the statement or supplement thereto 
required by this part shall be submitted. The individual submitting a 
statement should retain a copy for the individual's own records.



Sec. 10.735-405  Information required.

    (a) Employees. Employees' statement of employment and financial 
interests required by the regulations in this part shall be submitted on 
the form, ``Confidential Statement of Employment and Financial Interests 
(for use by Government Employees)'', Form OF-106, and shall contain all 
the information therein required.
    (b) Special Government employees. All special Government employees 
shall submit statements of employment and financial interest on the 
form, ``Confidential Statement of Employment and Financial Interests 
(for use by Special Government Employees)'', Form OF-107 for State and 
ICA, Form AID 4-450 for AID, and shall contain all the information 
therein required.
    (c) Interests of employee's relatives. The interest of a member of 
an employee's family is considered to be an interest of the employee. 
The term ``member of an employee's family'' is defined in Sec. 10.735-
102(f).
    (d) Information not known by employees. If any information required 
to be included on a statement of employment and financial interests or 
supplementary statement, including holdings placed in trust, is not 
known to the employee but is known to another person, the employee shall 
request that other person to submit information in the employee's 
behalf.
    (e) Interests not required to be reported. An employee need not 
disclose those financial interests described in Sec. 10.735-205(c) as 
being too remote or too inconsequential to affect the integrity of 
employees' services.
    (f) Information not required. The regulations in this part do not 
require an employee to submit on a statement of employment and financial 
interests or supplementary statement any information relating to the 
employee's connection with, or interest in, a professional society or a 
charitable, religious, social, fraternal, recreational, public service, 
civic, or political organization or a similar organization not conducted 
as a business enterprise. For the purpose of this section, educational 
and other institutions doing research and development or related work 
involving grants or money from or contracts with the Government are

[[Page 61]]

deemed ``business enterprises'' and are required to be included in an 
employee's statement of employment and financial interests.



Sec. 10.735-406  Submission of position description.

    Each Statement of Employment and Financial Interests or annual 
supplement thereto must be accompanied by a full description of the 
employee's principal governmental duties. The description should be 
particularly detailed in regard to those duties which might possibly be 
an element in a conflict of interest. If the statement indicates that 
the employee has no outside employment or financial interests, the 
employee need not submit a description of duties. For a special 
Government employee, the employing office shall submit the description.



Sec. 10.735-407  Supplementary statements.

    (a) Employees, as defined in paragraphs (b) and (c) of Sec. 10.735-
401, shall report changes in, or additions to, the information contained 
in their statements of employment and financial interests in 
supplementary statements as of June 30 each year. If no changes or 
additions occur, a negative report is required.
    (b) All special Government employees, as defined in paragraph (a) of 
Sec. 10.735-401, shall submit a current statement at the time their 
appointments are extended. A supplementary report indicating any changes 
in, or additions to the information already submitted will be accepted 
in lieu of a full submission. If there are no changes or additions, a 
negative report is required. For AID, no action to extend an appointment 
will be taken unless such supplementary report is submitted not later 
than 10 days prior to the expiration of said appointment.
    (c) Notwithstanding the filing of reports required by this section, 
each employee shall at all times avoid acquiring a financial interest 
that could result, or taking an action that would result, in a violation 
of the conflicts-of-interest provisions of section 208 of title 18, 
United States Code, or subpart B of this part.
    (d) An employee is also to keep current the employee's description 
of principal duties as to changes or additions which might possibly be 
an element in a conflict of interest. The employing office shall submit 
descriptions of changes in the principal duties of a special Government 
employee as they occur.



Sec. 10.735.408  Review of statements and determination as to conflicts of interest.

    (a) On the basis of the Statement of Employment and Financial 
Interests submitted by each employee or special Government employee, or 
on the basis of information received from other sources, the Counselor 
shall determine, in the light of the duties which that employee or 
special Government employee is or will be performing, whether any 
conflicts of interest, real or apparent, are indicated. The Counselor 
shall make this determination based on the applicable statutes, the 
Executive order, and the applicable regulations of the Civil Service 
Commission, and of the agency.
    (b) Where the Counselor's determination in a particular case is that 
a conflict of interest, real or apparent, is indicated, the Counselor 
shall initiate informal discussions with the employee or special 
Government employee concerned. These discussions shall have as their 
objectives:
    (1) Providing the individual with a full opportunity to explain the 
conflict or appearance of conflict; and
    (2) Arriving at an agreement (acceptable to the Counselor, the 
individual and the individual's immediate superior) whereby the conflict 
of interest may be removed or avoided. Such an agreement may include, 
but is not limited to: (i) Changes in assigned duties; (ii) divestiture 
of the financial or employment interest creating the conflict or 
apparent conflict; or (iii) disqualification for a particular 
assignment.
    (c) Where an acceptable agreement cannot be obtained pursuant to 
paragraph (b) of this section, the Counselor shall present findings and 
recommendations to the officer designated by the agency head, who shall

[[Page 62]]

decide which remedy is most appropriate to remove or correct that 
conflict or apparent conflict. Remedial action under this paragraph may 
include disciplinary action, including separation for cause, or any of 
the actions enumerated in paragraph (b)(2) of this section and shall be 
effective in accordance with applicable laws, Executive orders, and 
regulations.
    (d) Written summaries of all agreements and decisions arrived at 
pursuant to paragraph (b) or (c) of this section shall be placed in the 
Counselor's files. Copies shall also be made available to the employee 
or special Government employee concerned.



Sec. 10.735-409  Confidentiality of employees' statements.

    An agency shall hold each statement of employment and financial 
interests, and each supplementary statement, in confidence. To insure 
this confidentiality only the Counselor and Deputy Counselors are 
authorized to review and retain the statements. The Counselor and Deputy 
Counselors are responsible for maintaining the statements in confidence 
and shall not allow access to, or allow information to be disclosed 
from, a statement except to carry out the purpose of this part. An 
agency may not disclose information from a statement except as the Civil 
Service Commission or the agency head may determine for good cause 
shown.



Sec. 10.735-410  Effect of employees' statements on other requirements.

    The statements of employment and financial interests and 
supplementary statements required for employees are in addition to, and 
not in substitution for, or in derogation of, any similar requirement 
imposed by law, order, or regulation. The submission of a statement or 
supplementary statement by an employee does not permit the employee or 
any other person to participate in a matter in which the employee or the 
other person's participation is prohibited by law, order, or regulation. 
Save with respect to those financial interests excepted from the 
conflict of interest prohibitions of 18 U.S.C. 208(a) pursuant to a 
written advance determination under Sec. 10.735-217 or exempted by the 
provisions of Sec. 10.735-205(c), an employee must disqualify himself or 
herself from participating in any matter in which the employee has a 
financial interest.



Sec. 10.735-411  Disqualification procedures.

    (a) Where an employee is prohibited from participating in a matter 
because of a conflicting financial interest that is not exempt under 
Sec. 10.735-205(c) or has not been specifically excepted by the 
appropriate agency official pursuant to Sec. 10.735-217 in advance of 
the employee's participation in the particular matter, the employee 
shall conduct himself or herself in accordance with the following 
provisions:
    (1) The employee shall promptly disclose the financial interest in 
such matter to the employee's immediate superior. The superior will 
thereupon relieve the employee of duty and responsibility in the matter.
    (2) In foreign posts, it may be impossible or highly impracticable 
for an employee, who has a disqualifying financial interest, to assign 
the matter for official action to anyone other than a subordinate. In 
this event, the employee must instruct the subordinate to report fully 
and directly to the immediate superior to whom the employee himself or 
herself would normally report. The employee must concurrently direct 
such subordinate to take such action as may be appropriate in the 
matter, and without thereafter revealing to the disqualified employee in 
any way any aspect of the particular matter.
    (b) Nothing herein precludes the employee from disposing of such 
disqualifying financial interest, thereby wholly eliminating the 
conflict of interest. In some circumstances, where the employee may not 
obtain an exception under Sec. 10.735-217, or may not disqualify himself 
or herself and refer or assign the matter to another employee, the 
performance of duty may even require divestiture.
    (c) Where a supervisor has reason to believe that a subordinate 
employee may have a conflicting financial interest, the supervisor 
should discuss the matter with the employee. If the supervisor finds 
that a conflict of interest

[[Page 63]]

does exist, the supervisor must relieve the subordinate employee of duty 
and responsibility in the particular matter.
    (d) The obligation to avoid conflicts of interest is upon each 
employee. It is a continuing obligation calling for alert vigilance.
    (e) Notwithstanding any other provision of this part to the 
contrary, if a employee's holdings rise in value above the amount 
exempted by Sec. 10.735-205(c), then the statutory and regulation 
prohibitions apply in a conflict of interest situation.



PART 11--APPOINTMENT OF FOREIGN SERVICE OFFICERS--Table of Contents




Sec.
11.1  Junior Foreign Service officer career candidate appointments.
11.2  Written examination for appointment to class 7 or 8.
11.3  Oral examination for appointment to class 7 or 8.
11.4  Medical examination for appointment to class 7 or 8.
11.5  Certification for appointment to class 7 or 8.
11.6  Final Review Panel.
11.7  Termination of eligibility.
11.8  Travel expenses of candidates.
11.10  Mid-level Foreign Service officer career candidate appointments. 
          [Reserved]
11.11  Mid-level Foreign Service officer career candidate appointments.
11.20  Foreign Service specialist career candidate appointments.
11.30  Senior Foreign Service officer career candidate and limited non-
          career appointments.

    Authority:  Secs. 212, 302, 303, 516, 517, 60 Stat. 1001, as 
amended, 1002, 1008, as amended; 22 U.S.C. 827, 842, 843, 911.



Sec. 11.1  Junior Foreign Service officer career candidate appointments.

    (a) General considerations--(1) Authority. Pursuant to sections 302 
and 306 of the Foreign Service Act of 1980 (hereinafter referred to as 
the Act), all Foreign Service officers shall be appointed by the 
President, by and with the advice and consent of the Senate. All 
appointments shall be made to a class and not to a particular post. No 
person shall be eligible for appointment as a Foreign Service officer 
unless that person is a citizen of the United States. Such appointment 
is initially to career candidate status with subsequent commissioning to 
career status governed by the provisions of Volume 3 (Personnel), 
Foreign Affairs Manual, section 570. In accordance with section 102(b) 
of the Act, all references in these regulations to Foreign Service 
officers shall, with respect to the United States Information Agency, be 
deemed to refer to Foreign Service information officers.
    (2) Veterans' preference. Pursuant to section 301 of the Act, and 
notwithstanding the provisions of section 3320 of title 5 of the United 
States Code, the fact that an applicant is a veteran or disabled 
veteran, as defined in section 2108 (3A), (3B), or (3C) of such title, 
shall be considered as an affirmative factor in the selection of 
candidates for appointment as Foreign Service officer career candidates.
    (3) Policy. Appointment as a Junior Foreign Service officer Career 
Candidate of class 6, 5, or 4, is governed by these regulations. 
Successful applicants will be appointed as Career Candidates for a 
period not to exceed 5 years. Under precepts of the Commissioning and 
Tenure Board, Career Candidates may be granted tenure and converted to 
career Foreign Service officer status. Those who are not granted tenure 
prior to the expiration of their Career Candidate appointments will be 
separated from the Career Candidate program no later than the expiration 
date of their appointments. Separated candidates who originally were 
employees of a department or agency will be entitled to reemployment 
rights in their former department or agency in accordance with section 
310 of the Act.
    (b) Written examination. The following regulations apply to the 
written examination.
    (1) Purpose. The written examination is designed to enable the Board 
of Examiners for the Foreign Service to test the applicant's 
intelligence, breadth and quality of knowledge, and understanding in 
relation to the requirements of Foreign Service work.
    (2) Eligibility. Prior to each written examination, the Board of 
Examiners will establish a closing date for the receipt of applications 
for designation to take the examination. No person will be designated to 
take the examination who has not, as of that closing date,

[[Page 64]]

filed an application with the Board. To be designated to take the 
written examination, an applicant, as of the date of the examination, 
must be a citizen of the United States and at least 20 years of age.
    (3) When and where given. The written examination will be given 
periodically, normally at least once a year, in designated cities in the 
United States and at Foreign Service posts, on dates established by the 
Board of Examiners and publicly announced.
    (4) Grading. The several parts of the written examination will be 
weighted and graded according to standards established by the Board of 
Examiners. The number of candidates who pass each written examination 
will be governed by the projected hiring needs of the participating 
foreign affairs departments and agencies in subsequent years.
    (c) Oral examination. The following regulations apply to the oral 
examination:
    (1) Purpose. The oral examination is designed to enable the Board of 
Examiners for the Foreign Service to test the candidate's competence to 
perform the work of a Foreign Service officer at home and abroad, 
potential for growth in the Foreign Service, and suitability to serve as 
a representative of the United States abroad. The oral examination for 
the Junior Career Candidate Program will consist of an assessment 
procedure publicly announced by the Board of Examiners and hereinafter 
referred to as the oral examination.
    (2) Eligibility--(i) Through written examination. (A) Candidates 
whose weighted score on the written examination is at or above the 
passing level set by the Board of Examiners will be eligible for 
selection to take the oral examination. All eligible candidates normally 
will be invited to take the oral examination.
    (B) Should the total number of eligible candidates substantially 
exceed the projected hiring needs of the Foreign Service, the Board of 
Examiners may establish and publicly announce a higher written 
examination score than the passing level as the basis for selection to 
take the oral examination.
    (C) The Board of Examiners may authorize special consideration to be 
given in the selection of candidates, from among those eligible, for the 
purpose of meeting language requirements, Affirmative Action goals, or 
for other purposes which the Board with the concurrence of the 
prospective hiring agencies may from time to time approve and publicly 
announce.
    (D) The nature and applicability of all criteria utilized to select 
eligible candidates to take the oral examination will be developed by 
the Board of Examiners in consultation with the prospective hiring 
agencies and publicly announced in advance of each examination by the 
Board.
    (E) Candidates who are selected to take the oral examination will be 
notified of the period of time after the date of the written 
examination, as determined by the Board of Examiners, within which the 
oral examination must be conducted. That period will normally be 1 year, 
but it may be extended or shortened in special circumstances by the 
Board. The candidacy of anyone whose candidacy has not been extended by 
the Board, and who has not again passed the written examination in the 
meantime, will be terminated 2 years after the end of the month in which 
the written examination was held. Time spent outside the United States 
and its territories, for reasons acceptable to the Board of Examiners, 
will not be counted against this 2-year period. The candidacy of anyone 
for whom the 2-year period is extended by the Board because of being 
abroad will be terminated automatically if the candidate fails to appear 
for the oral examination within 3 months after first returning to the 
United States. If a candidate fails to appear for the oral examination 
on an agreed date within the period of eligibility without an excuse 
acceptable to the Board, the candidacy will automatically terminate.
    (ii) Through affirmative action. Members of the minority groups 
specified by the Equal Opportunity Act of 1972, as amended, may be 
selected by the Board of Examiners for admission to the oral examination 
in accordance with the Affirmative Action Programs of the participating 
departments and

[[Page 65]]

agencies. Such candidates must be at least 21 years of age, citizens of 
the United States, and holders of at least a bachelor's degree from an 
accredited college or university. Affirmative Action Program applicants 
will be evaluated on a highly competitive basis, in accordance with 
criteria established by the Board in conjunction with the participating 
departments and agencies and publicly announced, to determine those to 
be selected for the oral examination.
    (iii) Through the mustang program. (A) Employees of the Department 
of State in classes FS-9 through FS-4 and grades GS-1 through GS-12 who 
are at least 21 years of age and who have at least 3 years of service 
with the Department may be selected by the Board of Examiners for 
admission to the oral examination for the Junior Career Candidate 
Program in accordance with the Mustang Program of the Department. Such 
Mustang candidates must: (1) Complete successfully an appropriate 
Foreign Service Institute-sponsored or approved university or 
correspondence course relevant to officer-level responsibility in the 
chosen Foreign Service field of specialization; (2) submit an 
autobiography of approximately 1000 words; and (3) be recommended by a 
Qualifications Evaluation Panel of the Board of Examiners for selection 
for the oral examination.
    (B) Employees of the Department of State in classes FS-3 and GS-13 
and above are eligible for the Mid-Level Career Candidate Program and 
should apply under that program if they wish to be considered for 
conversion to Foreign Service officer status (see Sec. 11.10).
    (iv) Through the upward mobility program. Admission to the oral 
examination through the Upward Mobility Program of the United States 
Information Agency is governed by procedures established by that agency.
    (3) When and where given. The oral examination cycle will be held 
each year in Washington, DC, and in selected cities in the United 
States. If circumstances permit, oral examinations may also be held at 
selected Foreign Service posts when approved by the Board of Examiners.
    (4) Examining panel. The oral examination will be given by a panel 
of deputy examiners approved by the Board of Examiners from a roster of 
Foreign Service officers; Foreign Service information officers; career 
officers from the Department of State, the United States Information 
Agency, and the Department of Commerce; and qualified private citizens 
who, by prior service as members of departmental or agency Foreign 
Service selection boards or other appropriate activities, have 
demonstrated special qualifications to serve as deputy examiners. 
Service as a deputy examiner shall be limited to a maximum of 5 years, 
unless a further period is specifically authorized by the Board. 
Examination panels shall be chaired by a career officer of the Foreign 
Service. Determinations of duly constituted panels of deputy examiners 
are final unless modified by specific action of the Board of Examiners.
    (5) Grading. Candidates taking the oral examination will be graded 
numerically according to standards established and publicly announced by 
the Board of Examiners. The candidacy of anyone whose score is at or 
above the passing level set by the Board will be continued. The 
candidacy of anyone whose score is below the passing level will be 
terminated and may not be considered again until the candidate has 
passed a new written examination. An Affirmative Action, Mustang, or 
Upward Mobility candidate who fails the oral examination may not be 
considered again until 1 year after that date.
    (d) Background investigation. Candidates who pass the oral 
examination will be eligible for selection by the Board for the 
background investigation. The background investigation shall be 
conducted to determine the candidate's suitability for appointment to 
the Foreign Service. Should the total number of eligible candidates 
substantially exceed the anticipated needs of the Foreign Service, the 
Board of Examiners may authorize priorities to be established, on the 
basis of combined written and oral examination scores and Affirmative 
Action considerations, for scheduling the background investigation.

[[Page 66]]

    (e) Medical examination--(1) Eligibility. Candidates who pass the 
oral examination, and their dependents, will be eligible for selection 
by the Board of Examiners for the medical examination.
    (2) Purpose. The medical examination shall be conducted to determine 
the candidate's physical fitness to perform the duties of a Foreign 
Service officer on a worldwide basis and, for candidates and dependents, 
to determine the presence of any physical, neurological, or mental 
condition of such a nature as to make it unlikely that they would be 
able to function on a worldwide basis.
    (3) Conduct. The medical examination may be conducted by medical 
officers of the Department of State, the Armed Forces, the Public Health 
Service, accredited colleges and universities, or by private physicians.
    (4) Determination. The Medical Director of the Department of State 
will determine, on the basis of the report of the physician(s) who 
conducted the medical examination, whether the candidate and the 
candidate's dependents have met the required medical standards for 
appointment (see section 680, Volume 3, Foreign Affairs Manual).
    (5) Medical disqualification. (i) An Employment Review Committee 
established by the Department of State, when authorized by the 
candidate, will review the case of any Department of State Foreign 
Service candidate or dependent who has been denied medical clearance for 
appointment, and determine by majority vote whether or not the candidate 
should be appointed despite the medical disqualification. Decisions of 
the Employment Review Committee are final and are not subject to further 
appeal by the candidate.
    (ii) The United States Information Agency (USIA) maintains a similar 
review procedure for USIA Foreign Service candidates and dependents who 
are disqualified medically. Affected candidates may apply to the 
Director of the Office of Personnel (M/P) of USIA for review of their 
cases.
    (f) Final review panel. After the results of the medical examination 
and background investigation are received, the candidate's entire file 
will be reviewed and graded by a Final Review Panel, consisting of two 
or more deputy examiners of the Board of Examiners. Candidates who have 
completed the examination process; have passed their medical 
examination, or have obtained Employment Review Committee approval or 
the equivalent in accordance with the procedures of the other 
participating agencies; and, on the basis of their background 
investigation, have been found suitable to represent the United States 
abroad, will have their names placed on the functional rank-order 
register(s), or a special register, for the agency or agencies for which 
they have been found qualified. Thereafter, they will be considered for 
employment based on the needs of the individual foreign affairs 
agencies. The candidacy of any candidate who is determined by the Final 
Review Panel to be unqualified for appointment shall be terminated and 
the candidate so informed.
    (g) Certification for appointment--(1) Eligibility. (i) A candidate 
will not be certified as eligible for appointment as a Foreign Service 
Officer Career Candidate of class FS-6 unless that candidate is at least 
21 years of age and a citizen of the United States.
    (ii) Career Candidate appointments shall be made before the 
candidate's 60th birthday. Appointments by the United States Information 
Agency shall be made before the candidate's 58th birthday. The maximum 
age for appointment under this program is based on the requirement that 
all career candidates shall be able to: (A) Complete at least two full 
tours of duty, exclusive of orientation and training, (B) complete the 
requisite eligibility period for tenure consideration, and (C) complete 
the requisite eligiblity period to receive retirement benefits, prior to 
reaching the mandatory retirement age of 65 prescribed by the Act.
    (iii) A candidate may be certified as eligible for direct 
appointment to classes FS-5 or FS-4 if the Board of Examiners determines 
in accordance with published criteria that, in addition to meeting the 
requirements for class FS-6, the candidate has additional special 
experience and skills for which there is a need in the Foreign Service.
    (iv) Recommended candidates who meet the requirements of this 
section

[[Page 67]]

will be certified for appointment by the Board, in accordance with the 
needs of the foreign affairs agencies, in the order of their standing on 
their respective registers.
    (2) Functional rank-order registers. The Board of Examiners may 
maintain separate rank-order registers for Career Candidates in 
administrative, consular, economic, and political functions of the 
Department of State; for Career Candidates in the information/cultural 
function of the United States Information Agency; for Career Candidates 
in the foreign commercial function of the Department of Commerce; and 
for functions of other participating foreign affairs agencies. 
Appointments from each functional register will be made in rank order 
according to the needs of the relevant agency.
    (3) Special programs. (i) Qualified minority candidates who apply 
and qualify under the Department of State Affirmative Action Junior 
Officer Program (AAJOP) may be placed on a separate register and offered 
appointment from that register to meet Affirmative Action hiring goals 
established by the Secretary.
    (ii) Qualified minority candidates who apply and qualify under the 
Comprehensive Minority Recruitment and Training Program (COMRAT) of the 
United States Information Agency may be placed on a separate register 
and offered appointment from that register in accordance with the 
Affirmative Action Program established by that agency.
    (iii) Mustang and Upward Mobility candidates who are career 
employees of the Department of State or the United States Information 
Agency will be certified by the Board of Examiners for direct 
appointment on an individual basis after satisfactorily completing all 
aspects of the examination process.
    (4) Postponement of entrance on duty. Postponement of entrance on 
duty because of civilian Federal Government service abroad (to a maximum 
of 2 years of such service), including Peace Corps volunteer service, or 
required active regular or reserve military service (to a maximum of the 
limit of such required service), may be authorized by the Board.
    (5) Foreign language requirement. A candidate may be certified for 
appointment to classes FS-6, FS-5, or FS-4 without first having passed 
an examination in a foreign language, but the appointment will be 
subject to the condition that the newly appointed Career Candidate may 
not be converted to career Foreign Service officer status unless, within 
a specified period of time, adequate proficiency in a foreign language 
is achieved. For limitations on promotion, see section 874, Volume 3, 
Foreign Affairs Manual.
    (h) Termination of eligibility--(1) Time limit. Candidates who have 
qualified but have not been appointed because of lack of openings will 
be removed from the rank-order register 18 months after the date of 
placement on the rank-order register. Time spent in civilian Federal 
Government service abroad (to a maximum of 2 years of such service), 
including Peace Corps volunteer service, or in required active regular 
or reserve military service (to a maximum of the limit of such required 
service), will not be counted as part of the 18-month eligibility 
period.
    (2) Extension. The Board of Examiners may extend the eligibility 
period when such extension is, in its judgment, justified in the 
interest of the Foreign Service.
    (i) Travel expenses. The travel and other personal expenses of 
candidates incurred in connection with the written and oral examinations 
will not be borne by the Government. However, the participating foreign 
affairs departments and agencies may issue round-trip invitational 
travel orders to bring candidates to Washington, DC, at Government 
expense, when it is determined by the agencies that this is necessary in 
the interest of the Foreign Service.

(Secs. 206(a) and 301(b), Foreign Service Act of 1980 (secs. 206(a) and 
301(b), Pub. L. 96-465, 94 Stat. 2079 and 2083 (22 U.S.C. 3926 and 
3941)))
[48 FR 13162, Mar. 30, 1983]



Sec. 11.2  Written examination for appointment to class 7 or 8.

    The Board of Examiners for the Foreign Service has established the 
following rules regarding the written examination:

[[Page 68]]

    (a) When and where given. The written examination will be given 
annually or semiannually, if required, in designated cities in the 
United States and at Foreign Service posts on dates established by the 
Board of Examiners for the Foreign Service. Applicants must indicate in 
their applications whether they are applying for the Department of State 
or for the U.S. Information Agency. Candidates who pass the written 
examination successfully may request a transfer of their applications to 
the other agency.
    (b) Designation to take written examination. No person will be 
permitted to take a written examination for appointment as a Foreign 
Service officer or Foreign Service information officer who has not been 
specifically designated by the Board of Examiners to take that 
particular examination. Prior to each written examination, the Board 
will establish a closing date for the receipt of applications for 
designation to take the examination. No person will be designated for 
the examination who has not, as of that closing date, filed an 
application with the Board. To be designated for the written 
examination, a candidate, as of the date of the examination, must be a 
citizen of the United States and shall be at least 21 years of age, 
except that an applicant who has been awarded a bachelor's degree by a 
college or university, or has successfully completed the junior year at 
a college or university, may qualify if at least 20 years of age.
    (c) Content. The written examination is designed to permit the Board 
to test the candidate's intelligence, breadth and quality of knowledge, 
and understanding. It will consist of three parts: (1) A general ability 
test, (2) an English expression test, and (3) a general background test.
    (d) Grading. The several parts of the written examination are 
weighted in accordance with the rules established by the Board of 
Examiners.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972, as amended at 38 FR 13640, May 24, 1973]



Sec. 11.3  Oral examination for appointment to class 7 or 8.

    The Board of Examiners for the Foreign Service has established the 
following rules regarding the oral examination:
    (a) When and where given. The oral examination will be given 
throughout the year at Washington and periodically in selected cities in 
the United States and, if circumstances permit, at selected Foreign 
Service posts.
    (b) Eligibility. If a candidate's weighted average on the written 
examination is 70 or higher, the candidate will be eligible to take the 
oral examination. Candidates eligible for the oral examination will be 
given an opportunity and will be required to take the oral examination 
within 9 months after the date of the written examination. If a 
candidate fails to appear for the oral examination on an agreed date 
within the 9-month period, the candidacy will automatically terminate, 
except that time spent outside the United States and its territories, 
for reasons acceptable to the Board of Examiners, will not be counted 
against the 9-month period. The candidacy of anyone for whom the 9-month 
period is extended because of being abroad will be automatically 
terminated if the candidate fails to appear for the oral examination 
within 3 months after first returning to the United States: Provided, 
That the candidacy of anyone who has not returned and been examined in 
the meantime will be canceled 2 years after the end of the month in 
which the written examination was held.
    (c) Examining process. (1) The oral examination will be given by a 
panel of deputy examiners approved by the Board of Examiners from a 
roster of Foreign Service officers, officers from the Department of 
State, and other Government agencies, and qualified private citizens who 
by prior service as members of selection boards or through other 
appropriate activities have demonstrated special qualifications for this 
work. Service as deputy examiners shall be limited to a maximum of 5 
years, unless a further period is specifically authorized by the Board.
    (2) The examination will be conducted in the light of all available 
information concerning the candidate

[[Page 69]]

and will be designed to determine the candidate's: (i) Competence to 
perform the work of a Foreign Service officer at home and abroad; (ii) 
potential for growth in the Service; and (iii) suitability to serve as a 
representative of the United States abroad. Panels examining candidates 
for the Department of State will be chaired by a Foreign Service officer 
of the Department. Panels examining candidates for the U.S. Information 
Agency will be chaired by a Foreign Service officer of that Agency. 
Determinations of duly constituted panels of deputy examiners are final, 
unless modified by specific action of the Board of Examiners for the 
Foreign Service.
    (3) Grading: Candidates appearing for the oral examination will be 
graded ``recommended'' or ``not recommended.'' If recommended, the panel 
will assign a grade which will be advisory to the Final Review Panel in 
determining the candidate's standing on the rank-order register of 
eligibles. The candidacy of anyone who is graded ``not recommended'' is 
automatically terminated and may not be considered again until the 
candidate has passed a new written examination.
    (4) An investigation shall be conducted of candidates who have been 
graded ``recommended'' by the oral examining panel to determine loyalty 
to the Government of the United States and attachment to the principles 
of the Constitution.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972, as amended at 38 FR 13640, May 24, 1973]



Sec. 11.4  Medical examination for appointment to class 7 or 8.

    The Board of Examiners for the Foreign Service has established the 
following rules regarding the medical examination of candidates.
    (a) A candidate graded ``recommended'' on the oral examination will 
be eligible for the physical examination.
    (b) The medical examination is designed to determine the candidate's 
physical fitness to perform the duties of a Foreign Service officer on a 
worldwide basis and to determine the presence of any physical, nervous, 
or mental disease or defect of such a nature as to make it unlikely that 
the candidate would become a satisfactory officer. The Executive 
Director of the Board of Examiners for the Foreign Service, with the 
concurrence of the Deputy Assistant Secretary for Medical Services, may 
make such exceptions to these physical requirements as are in the 
interest of the Service. All such exceptions shall be reported to the 
Board of Examiners for the Foreign Service at its next meeting.
    (c) The medical examination will be conducted by medical officers of 
the Armed Forces, the Public Health Service, the Department, accredited 
colleges and universities, or, with the approval of the Board of 
Examiners, by private physicians.
    (d) The Deputy Assistant Secretary for Medical Services will 
determine, on the basis of the report of the physician(s) who conducted 
the medical examination, whether the candidate has met the standards set 
forth in paragraph (b) of this section.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972]



Sec. 11.5  Certification for appointment to class 7 or 8.

    (a) Candidates will not be certified as eligible for appointment as 
Foreign Service officers of class 8 unless they are at least 21 years of 
age, is a citizen of the United States, and, if married, married to a 
citizen of the United States. A candidate may be certified as eligible 
for direct appointment to class 7 if, in addition to meeting these 
specifications, the candidate also has additional qualifications of 
experience, education, and age which the Board of Examiners for the 
Foreign Service currently defines as demonstrating ability and special 
skills for which there is a need in the Foreign Service. Recommended 
candidates who meet these requirements will be certified for 
appointment, in accordance with the needs of the Service, in the order 
of their standing on their respective registers.
    (b) Separate registers for Department of State candidates will be 
maintained

[[Page 70]]

for the administrative, consular, commercial/economic, and political 
functional specialties. Successful candidates for the U.S. Information 
Agency will have their names placed on a separate rank-order register 
and appointments will be made according to the needs of the Agency. 
Postponement of entrance on duty for required active military service, 
or required alternative service, civilian Government service abroad (to 
a maximum of 2 years of such civilian service), or Peace Corps volunteer 
service, will be authorized. A candidate may be certified for 
appointment to class 7 or 8 without first having passed an examination 
in a foreign language, but the appointment will be subject to the 
condition that the newly appointed officer may not receive more than one 
promotion unless, within a specified period of time, adequate 
proficiency in a foreign language is achieved.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972, as amended at 38 FR 13640, May 24, 1973]



Sec. 11.6  Final Review Panel.

    After the results of the medical examination and background 
investigation are received, the candidate's entire file will be reviewed 
by a Final Review Panel, consisting of two or more deputy examiners. 
Candidates who have been graded ``recommended'' by oral examining 
panels, who have passed their medical examination, and who, on the basis 
of investigation have been found to be loyal to the Government of the 
United States and personally suitable to represent it abroad, will have 
their names placed on a rank-order register for the functional specialty 
for which they have been qualified. Their standing on the register will 
be determined by the Final Review Panel after taking into account the 
grade assigned by the oral examining panel and any information developed 
subsequent to the oral examination concerning the applicant. The 
candidacy of anyone who is determined by the Final Review Panel to be 
unqualified for appointment shall be terminated and the candidate so 
informed.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972]



Sec. 11.7  Termination of eligibility.

    (a) Candidates who have qualified but have not been appointed 
because of lack of vacancies will be dropped from the rank-order 
register 30 months after the date of the written examination: Provided, 
however, That reasonable time spent in civilian Government service 
abroad (to a maximum of 2 years such service), including service as a 
Peace Corps volunteer, in required active military service, or in 
required alternative service, subsequent to establishing eligibility for 
appointment will not be counted in the 30-month period.
    (b) The Chairman of the Board of Examiners may extend the 
eligibility period when such extension is, in his judgment, justified in 
the interests of the Service. The Chairman shall report the approved 
extensions to the Board of Examiners.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972]



Sec. 11.8  Travel expenses of candidates.

    The travel and other personal expenses of candidates incurred in 
connection with the written and oral examinations will not be borne by 
the Government, except that the Department may issue round-trip 
invitational travel orders to bring candidates to Washington at 
Government expense when it is determined that it is necessary in 
ascertaining a candidate's qualifications and adaptability for 
appointment.

(22 U.S.C. 1221 et seq.)
[37 FR 19356, Sept. 20, 1972]



Sec. 11.10  Mid-level Foreign Service officer career candidate appointments. [Reserved]



Sec. 11.11  Mid-level Foreign Service officer career candidate appointments.

    (a) General considerations--(1) Authority. Pursuant to sections 302 
and 306 of the Foreign Service Act of 1980 (hereinafter referred to as 
the Act), all Foreign Service officers shall be appointed by the 
President, by and with the advice and consent of the Senate. All 
appointments shall be made to a class and not to a particular post. No 
person shall be eligible for appointment as a

[[Page 71]]

Foreign Service officer unless that person is a citizen of the United 
States. Such appointment is initially to career candidate status, with 
subsequent commissioning to career status governed by Volume 3 
(Personnel), Foreign Affairs Manual section 570.
    (2) Veterans' preference. Pursuant to section 301 of the Act, and 
notwithstanding the provisions of section 3320 of title 5 of the United 
States Code, the fact that an applicant is a veteran or disabled 
veteran, as defined in section 2108(3A), (3B), and (3C) of such title, 
shall be considered as an affirmative factor in the selection of 
candidates for appointment as Foreign Service officer career candidates 
(22 U.S.C. 1234).
    (3) Purpose and policy. The Mid-Level Career Candidate Program of 
the Department of State supplements the Junior Foreign Service Officer 
Career Candidate Program to meet total requirements for Foreign Service 
officers at the mid-level. The purposes of the Mid-Level Program are: 
(i) To provide expanded opportunities and upward mobility for 
outstanding members of the Foreign Service with high potential who have 
been serving with particular success in other occupational categories; 
(ii) to permit the recruitment of a limited number of highly skilled and 
qualified personnel from outside the Foreign Service to meet specific 
needs which cannot be met from within the career Service; and (iii) to 
assist in meeting the Affirmative Action goals of the Department of 
State. This section governs appointments to generalist occupational 
categories (that is, administrative, consular, economic and political) 
at classes FS-3, 2, or 1. All appointments above FS-1, regardless of 
occupational category, are govern by Sec. 11.30 (to be supplied). 
Appointments to Specialist occupational categories below the Senior 
Foreign Service are governed by Sec. 11.20. Successful applicants under 
the Mid-Level Program will be appointed to career candidate status for a 
period not to exceed 5 years. Under precepts of the Commissioning and 
Tenure Board, career candidates may be granted tenure and converted to 
career Foreign Service officer status. Those who are not granted tenure 
prior to the expiration of their career candidate appointments will be 
separated from the Career Candidate Program no later than the expiration 
date of their appointments. As provided in section 310 of the Act, such 
separated candidates who had originally been employed by the Department 
of State with the consent of the head of their agency shall be entitled 
to reemployment rights in their former agency under section 3597 of 
title 5, United States Code.
    (4) Sources of candidates--(i) Department. The great majority of 
mid-level entrants will be career employees of the Department of State 
and the Foreign Service of proven ability who possess high potential for 
advancement. On the basis of the needs of the Foreign Service, the 
Department will approve the mid-level appointment of Foreign Service and 
Civil Service personnel on its rolls who apply, for whom the Bureau of 
Personnel issues a certificate of need, and who are found qualified by 
the Board of Examiners for the Foreign Service.
    (ii) Other Federal Government agencies. Personnel with similar 
qualifications from other Federal Government agencies may also apply for 
the Mid-Level Program based on agreements between the Department and 
those agencies.
    (iii) Other. Other candidates may be drawn from non-Government 
sources, including minority and women applicants for the Department's 
Mid-Level Affirmative Action Program.
    (b) Eligibility requirements--(1) Citizenship. Each person appointed 
as a Foreign Service mid-level career candidate must be a citizen of the 
United States.
    (2) Service. (i) On the date of application, a candidate must have 
completed a minimum of 9 years of professional work experience, 
including at least 3 years of service in a position of responsibility in 
a Federal Government agency or agencies. For this purpose, a position of 
responsibility is defined as one in the Foreign Service at class FS-5, 
in the Civil Service at GS-9, or in the Armed Forces as first lieutenant 
or lieutenant junior grade, or higher. Academic studies, particularly 
those related to Foreign Service work, may be substituted for part of 
the required experience. The duties and responsibilities of the position 
occupied by the candidate must have been similar to or

[[Page 72]]

closely related to that of a Foreign Service officer in terms of 
knowledge, skills, abilities, and overseas work experience. In addition, 
a candidate must currently be in, or have been in, a grade or class 
comparable to FS-4 or higher.
    (ii) Candidates from outside the Department who at the time of 
application lack 3 years of service in a position of responsibility as 
defined in the preceding paragraph may, however, be considered if they 
are found to possess a combination of educational background, 
employment, experience, and skills needed by the Foreign Service at the 
mid-level.
    (3) Age. All career candidate appointments shall be made before the 
candidate's 60th birthday. The maximum age for appointment under this 
program is based on the requirement that all career candidates shall be 
able to (i) complete at least two full tours of duty, exclusive of 
orientation and training, (ii) complete the requisite eligibility period 
for tenure consideration, and (iii) complete the requisite eligibility 
period to receive retirement benefits, prior to reaching the mandatory 
retirement age of 65 prescribed by the Act.
    (4) Certification of need. Before the Board of Examiners may process 
a candidacy, the Director General of the Foreign Service must certify 
that there is a continuing, long-term requirement, consistent with the 
projections of personnel flows and needs mandated by section 601(c)(2) 
of the Act, for a combination of professional work experience, 
educational background, skills, and capabilities possessed by the 
applicant which cannot reasonably be met from within the ranks of the 
career service, including by special training of career personnel and/or 
limited appointments pending completion of such training, if feasible. 
No applicant may be appointed in an occupational category or at a class 
level for which the Director General has not certified a need. Such 
certifications shall take into full account the latest published skills 
resources inventory and shall be based on a written assessment of the 
assignment and promotion effects on career members of the Foreign 
Service. A separate certification of need is not required for applicants 
under the Mid-Level Affirmative Action Program, as the hiring goals 
established by the Secretary constitute the certification for applicants 
under that Program. The exclusive employee representative will be 
advised promptly in writing on request of the number, nature, and dates 
of the certifications of need issued since the last request, including a 
affirmation that each such issuance has been in accordance with the 
requirements of this section.
    (c) Recruitment--(1) From within the Department. It is the 
Department's policy to encourage eligible personnel on its rolls to 
apply for appointment as Mid-Level Foreign Service officer career 
candidates including, in particular, the following categories: (i) 
Members of the Foreign Service whose performance has been consistently 
of a high caliber, and whose background, experience, and general 
qualifications indicate that they can compete favorably with Foreign 
Service officers; and (ii) Civil Service personnel who are serving in 
positions to which Foreign Service officers are normally assigned, who 
have superior records, and whose general qualifications indicate that 
they can compete favorably with Foreign Service officers.
    (2) Other. The Department also encourages highly qualified 
applicants from other agencies of the Federal Government, and from 
outside the Federal Government, who meet the statutory and other 
eligibility requirements, to apply for the Mid-Level Program. 
Appointments from these sources for available openngs are made on a 
highly competitive basis to fill specific needs of the Foreign Service 
at the Mid-Level.
    (d) Methods of application--(1) Forms. Application is made for a 
Mid-Level Foreign Service officer career candidate appointment but not 
for a specific class. Applicants for mid-level entry must complete 
Standard Form 171, ``Personnel Qualifications Statement,'' and Form DSP-
34, ``Supplement to Application for Federal Employment,'' and forward 
them, together with an autobiography not exceeding four typewritten 
pages in length, to the Board of Examiners for the Foreign Service for 
consideration.

[[Page 73]]

    (2) Qualifications evaluation panel. The Board of Examiners 
establishes a file for each applicant, placing in it all available 
documentation of value in evaluating the applicant's potential for 
service as a Foreign Service officer. A Qualifications Evaluation Panel 
of deputy examiners of the Board of Examiners reviews the file to 
determine whether the applicant meets the statutory and other 
eligibility requirements, to assess the applicant's skills relative to 
the needs of the Foreign Service, and to recommend whether the applicant 
should be examined for possible appointment under the Mid-Level Program.
    (e) Examination for mid-level appointment. The submission of an 
application to the Board of Examiners does not in itself entitle an 
applicant to examination. The decision whether to proceed with an 
examination will be made by the Board of Examiners after a thorough 
review of the candidate's qualifications and a determination of 
eligibility for appointment following receipt of a certification of need 
for that candidate.
    (1) Purpose. The mid-level examination is designed to enable the 
Board of Examiners to determine a candidate's aptitude for the work of 
the Foreign Service at the mid-level and fitness for a Foreign Service 
career.
    (2) Class. In determining the Foreign Service officer class for 
which a candidate will be examined, the Board of Examiner's presumption 
will be for the class which is equivalent to the candidate's current 
salary level. In evaluating qualifications and in conducting 
examinations, the Board of Examiners will determine whether the 
candidate's qualifications compare favorably with Foreign Service 
officers at the candidate's current salary level. However, the Board of 
Examiners, at its discretion, may certify a candidate for appointment as 
a career candidate at a class other than that equivalent to current 
salary level in those instances where the Board determines that the 
candidate's qualifications clearly warrant such action.
    (3) Written examination. A written examination will not normally be 
required of candidates for mid-level appointment. However, if the volume 
of applications for a given class or classes, or a particular functional 
specialty, is such as to make it infeasible to examine all candidates 
orally within a reasonable time, such candidates may be required to take 
an appropriate written examination prescribed by the Board of Examiners. 
Candidates whose score on the written examination is at or above the 
passing level set by the Board of Examiners will be eligible for 
selection for the oral examination.
    (4) Oral examination--(i) Purpose. The oral examination will be 
designed to enable the Board of Examiners to determine whether 
candidates are functionally qualified for work in the Foreign Service at 
the mid-level, whether they have the potential to advance in the Foreign 
Service, and whether they have the background and experience to make a 
contribution to the Foreign Service.
    (ii) When and where given. The oral examination is individually 
scheduled throughout the year and is normally given in Washington, DC. 
At the discretion of the Board of Examiners, it may be given in other 
American cities, or at Foreign Service posts, selected by the Board.
    (iii) Examining panel. Candidates recommended by a Qualifications 
Evaluation Panel for examination will be given an oral examination by a 
panel of deputy examiners of the Board of Examiners. That panels shall 
include at least one officer from the functional or professional 
specialty for which the candidate is being examined. Examining panels 
shall be chaired by a career officer of the Foreign Service. 
Determinations of duly constituted panels of deputy examiners are final 
unless modified by specific action of the Board of Examiners.
    (iv) Content. The Examining Panel will question the candidate 
regarding the indicated functional or professional specialty; knowledge 
of American history, government, and other features of American culture; 
familiarity with current events and international affairs; and other 
matters relevant to the candidate's qualifications for appointment.

[[Page 74]]

    (v) Grading. Candidates taking the oral examination will be graded 
numerically according to standards established by the Board of 
Examiners. The candidacy of anyone whose score is at or above the 
passing level set by the Board will be continued. The candidacy of 
anyone whose score is below the passing level will be terminated and may 
not be considered again until 1 year after that date.
    (5) Written essay. Candidates who take the oral examination will be 
asked to write an essay during the examination day, on a topic related 
to Foreign Service work, to enable the Board of Examiners to measure the 
candidate's effectiveness of written expression.
    (6) Other exercises. Candidates who take the oral examination also 
may be asked to complete other exercises during the examination day, to 
enable the Board of Examiners to measure additional aspects of 
performance related to Foreign Service work at the mid-level.
    (7) Background investigation. Candidates who pass the oral 
examination will be eligible for selection for the background 
investigation. The background investigation shall be conducted to 
determine suitability for appointment to the Foreign Service.
    (8) Medical examination. Candidates who pass the oral examination, 
and their dependents, will be eligible for selection for the medical 
examination. The medical examination shall be conducted to determine the 
candidate's physical fitness to perform the duties of a Foreign Service 
officer on a world-wide basis and, for candidates and dependents, to 
determine the presence of any physical, neurological, or mental 
condition of such a nature as to make it unlikely that they would be 
able to function on a world-wide basis.
    (9) Final review panel. The entire file of candidates who pass the 
oral examination will be reviewed and graded by a Final Review Panel, 
consisting of two or more deputy examiners of the Board of Examiners, 
after the results of the background investigation and the medical 
examination are received. The Final Review Panel will take into account 
the grade assigned by the oral Examining Panel, as well as all other 
available information concerning the candidate, and decide whether or 
not to recommend the candidate for appointment. The candidate's file 
will then be submitted to the Board of Examiners for approval. If 
approved by the Board, the candidate's name will be entered on the rank-
order register for the class and functional specialty for which the 
candidate has been found qualified. The candidacy of anyone who is not 
recommended for appointment by the Final Review Panel shall be 
terminated and the candidate so informed.
    (10) Foreign language requirement. All candidates who pass the oral 
examination will be required to take a subsequent test to measure their 
fluency in foreign languages or their aptitude for learning them. A 
candidate may be appointed without first having passed an examination in 
a foreign language, but the appointment will be subject to the condition 
that the newly appointed career candidate may not be converted to career 
Foreign Service officer status unless, within a specified period of 
time, adequate proficiency in a foreign language is achieved. For 
limitations on promotions see Volume 3 (Personnel), Foreign Affairs 
Manual, section 874.
    (11) Certification for appointment--(i) Departmental employees. A 
candidate who is a career employee of the Department, for whom a 
certification of need has been issued, will be certified by the Board of 
Examiners for appointment after satisfactorily completing all aspects of 
the examination process. The appointment certification will specify the 
class and salary for which the candidate has been found qualified.
    (ii) Others. Other successful candidates will, after being approved 
by the board of Examiners, have their names placed on the rank-order 
register for the class and functional specialty for which they have been 
found qualified. A separate rank-order register may be established for 
candidates under the Mid-Level Affirmative Action Program. Appointments 
to available openings will be made from the registers in rank-order 
according to the needs of the Foreign Service.
    (12) Termination of eligibility. Candidates who have qualified but 
have not been appointed because of lack of openings will be removed from 
the

[[Page 75]]

rank-order register 18 months after the date of placement on the rank-
order register. The Board of Examiners may extend the eligibility period 
when such extension is, in its judgment, justified in the interests of 
the Foreign Service.

(Secs. 206(a) and 301(b), Foreign Service Act of 1980 (secs. 206(a) and 
301(b), Pub. L. 96-465, 94 Stat. 2079 and 2083 (22 U.S.C. 3926 and 
3941)))
[48 FR 19702, May 2, 1983]



Sec. 11.20  Foreign Service specialist career candidate appointments.

    (a) General considerations. (1) Section 303 of the Foreign Service 
Act of 1980 (hereinafter referred to as the Act) authorizes the 
appointment of members of the Service (other than Presidential 
appointments).
    (2) Section 306 of the Act provides that, before receiving a career 
appointment in the Foreign Service, an individual shall first serve 
under a limited appointment for a trial period of service as a career 
candidate.
    (3) This section governs the appointment by the Department of State 
of Foreign Service specialist career candidates to classes FS-1 and 
below. Specialist candidates comprise all candidates for career 
appointment in all occupational categories other than generalists (that 
is, administrative, consular, economic, political, and program 
direction), who are governed by the regulations respecting Foreign 
Service officer career candidates. The appointment of all Senior Foreign 
Service career candidates regardless of occupational category is 
governed by Sec. 11.30 (to be supplied). Regulations governing trial 
service and tenuring of specialist candidates are found in Volume 3 
(Personnel), Foreign Affairs Manual, section 580.
    (4) Veterans' preference shall apply to the selection and 
appointment of Foreign Service specialist career candidates.
    (b) Specialist career candidate appointments--(1) Certification of 
need. Candidates for appointment as specialist career candidates must be 
world-wide available and must have a professional or a functional skill 
for which there is a continuing need in the Foreign Service. Before an 
application can be processed, the Director General of the Foreign 
Service must certify that there is a need for the applicant as a career 
candidate in the specialist category at or above the proposed class of 
appointment. No applicant shall be appointed at a class level for which 
there is no certified need. This individual certification of need is not 
required for those specialist occupations which the Director General 
determines in advance to be shortage or continuous recruitment 
categories, and for which the Director General has certified the need 
for a specific number of appointments at given levels. Such 
appointments, including an appointment of an individual who is the 
employee of any agency, may not exceed 5 years in duration, and may not 
be renewed or extended beyond 5 years. A specialist candidate denied 
tenure under Volume 3 (Personnel), Foreign Affairs Manual, section 580, 
may not be reappointed as a career candidate in the same occupational 
category.
    (2) Eligibility. An applicant must be a citizen of the United States 
and at least 20 years of age. The minimum age for appointment as a 
career candidate is 21. All career candidate appointments shall be made 
before the candidate's 60th birthday. The maximum age for appointment 
under the program is based on the requirement that all career candidates 
shall be able to (i) complete at least two full tours of duty, exclusive 
of orientation and training, (ii) complete the requisite eligibility 
period for tenure consideration, and (iii) complete the requisite 
eligibility period to receive retirement benefits, prior to reaching the 
mandatory retirement age of 65 prescribed by the Act.
    (3) Selection and initial screening. Specialist career candidates 
will be selected on the basis of education, experience, suitability, 
performance potential, and physical fitness for world-wide service. 
Applicants normally will be given personal interviews and will be 
subject to such written, oral, physical, foreign language, and other 
examinations as may be prescribed by the Board of Examiners for the 
Foreign Service and administered by the Office of Recruitment, 
Examination, and Employment (PER/REE). The Board of Examiners will 
identify and/or approve the knowledge, skills, abilities, and

[[Page 76]]

personal characteristics required to perform the tasks and duties of 
Foreign Service specialists in each functional field. PER/REE will 
screen applications for appointment as Foreign Service specialist career 
candidates under approved criteria and select those who meet the 
requirements for further processing under these regulations.
    (4) Oral Examination. Candidates selected through the initial 
screening will be eligible for an oral examination unless they are 
candidates for appointment in occupational categories for which the oral 
examination may be waived by the Director General. This waiver normally 
will apply only to continuous-recruitment categories and to appointments 
below the FS-6 level, and where such waivers occur, a thorough oral 
interview will be conducted. The oral examination will be given by a 
panel of deputy examiners, at least one of whom will be a career Foreign 
Service specialist proficent in the functional field for which the 
candidate is being tested. The examination may include a writing sample. 
Candidates taking the oral examination will be graded numerically 
according to standards set by the Board of Examiners. The candidacy of 
anyone whose score is at or above the passing level set by the Board 
will be continued. The candidacy of anyone whose score is below the 
passing level will be terminated and may not be considered again for 1 
year.
    (5) Background investigation. Candidates who have passed the oral 
examination, and candidates who have passed the initial screening if the 
oral examination has been waived, will be eligible for selection for the 
background investigation to determine their suitability for appointment 
to the Foreign Service.
    (6) Medical examination. Such candidates and their dependents will 
be eligible for selection for the medical examination. The medical 
examination shall be conducted to determine the candidate's physical 
fitness to perform the duties of a Foreign Service specialist on a 
world-wide basis and, for candidates and dependents, to determine the 
presence of any physical, neurological, or mental condition of such a 
nature as to make it unlikely that they would be able to function on a 
world-wide basis.
    (7) Final review panel. After the results of the medical examination 
and background investigation have been received, a Final Review Panel, 
consisting of two or more deputy examiners of the Board of Examiners, or 
by another appropriate panel appointed for the purpose by the Director 
of PER/REE, will review and grade the candidate's entire file. 
Candidates approved by the Final Review Panel will have their names 
placed on a rank-order register for the functional specialty for which 
they are qualified. Candidates will remain eligible for appointment for 
18 months from the date of placement on the rank-order register. The 
Board of Examiners may extend this eligibility period when such 
extension is, in its judgment, justified in the interests of the Foreign 
Service. The candidacy of anyone who is not recommended for appointment 
by the Final Review Board shall be terminated and the candidate so 
informed.
    (c) Limited non-career appointments. Other Foreign Service 
specialist appointments may be made on a limited non-career basis. 
Before an application for a limited non-career appointment can be 
processed, the Director General of the Foreign Service must certify that 
there is a need for the applicant. Such limited specialists must serve 
overseas, and they will be subject to the same conditions as those 
outlined in these regulations for career candidates, with the exception 
that the maximum age of 59 does not apply to such appointments. However, 
because members of the Foreign Service generally are subject to the 
mandatory retirement age of 65 under section 812 of the Act, limited 
non-career appointments normally will not extend beyond the appointee's 
65th birthday. Applicants for limited non-career appointments will be 
subject to the same screening, medical examination, background 
investigation, and final review process required of career candidates, 
but normally they will not be subject to a written or oral examination. 
Their appointments will normally be limited to the duration of the 
specific assignment for which they are to be hired, may not exceed 5 
years in duration,

[[Page 77]]

and may not be renewed or extended beyond 5 years. Ordinarily, no 
limited non-career appointee will be reappointed until at least 1 year 
has elapsed since the expiration of a previous appointment. However, 
earlier reappointment may be granted in cases of special need, provided 
the exclusive employee representative is advised in advance and is 
afforded an opportunity to comment. Prior to the expiration of their 
limited appointments, if otherwise eligible, non-career appointees may 
compete for career candidate status by qualifying at that time for and 
taking the examinations required of career candidates. If successful, 
their names would be entered on the rank-order register for their 
functional specialty. If appointed as career candidates, the length of 
service under their previous limited non-career appointments may be 
counted as part of the trial period of service prescribed before a 
candidate can receive a career appointment.

(Secs. 206(a) and 301(b), Foreign Service Act of 1980 (secs. 206(a) and 
301(b), Pub. L. 96-465, 94 Stat. 2079 and 2083 (22 U.S.C. 3926 and 
3941)))
[48 FR 19704, May 2, 1983]



Sec. 11.30  Senior Foreign Service officer career candidate and limited non-career appointments.

    (a) General considerations. (1) Career officers at the Senior Level 
normally shall be appointed as the result of promotion of Mid-Level 
career officers. Where the needs of the Foreign Service at the Senior 
Level cannot otherwise be met by this approach, limited appointments may 
by granted to applicants as Senior Career Candidates or as limited non-
career appointees in accordance with these regulations. However, as 
required by section 305(b) of the Foreign Service Act of 1980 
(hereinafter referred to as the Act), but qualified by section 305(b)(1) 
and (2) and section 2403(c) of the Act, the limited appointment of an 
individual in the Senior Foreign Service shall not cause the number of 
members of the Senior Foreign Service serving under limited appointments 
to exceed 5 percent of the total members of the Senior Foreign Service.
    (2) Successful applicants under the Senior Career Candidate Program 
will be appointed to Career Candidate status for a period not to exceed 
5 years. Such limited Career Candidate appointments may not be renewed 
or extended beyond 5 years.
    (3) Under section 306 of the Act, Senior Career Candidates may be 
found qualified to become career members of the Senior Foreign Service. 
Those who are not found to be so qualified prior to the expiration of 
their limited appointments will be separated from the Career Candidate 
Program no later than the expiration date of their appointments. 
Separated candidates who originally were employees of a Federal 
department or agency, and who were appointed to the Senior Foreign 
Service with the consent of the head of that department or agency, will 
be entitled to reemployment rights in that department or agency in 
accordance with section 310 of the Act and section 3597 of title 5, 
United States Code.
    (4) The following regulations shall be utilized in conjunction with 
section 593, Volume 3, Foreign Affairs Manual (``Senior Foreign Service 
Officer Career Candidate Program''). (Also see Foreign Affairs Manual 
Circulars No. 8 [applicable to the Department of State only] and No. 9 
[applicable to the Departments of State, Agriculture, and Commerce, the 
Agency for International Development, and the United States Information 
Agency], dated March 6, 1981.)
    (b) Senior Career Candidate appointments--(1) Eligibility 
requirements. Senior Career Candidates must meet the following 
eligibility requirements:
    (i) Citizenship. Each person appointed as a Senior Career Candidate 
must be a citizen of the United States.
    (ii) Age. All career candidate appointments shall be made before the 
candidate's 60th birthday. Appointments by the United States Information 
Agency shall be made before the candidate's 58th birthday. The maximum 
age for appointment under this program is based on the requirement that 
all career candidates shall be able to: (A) Complete at least two full 
tours of duty, exclusive of orientation and training; (B) complete the 
requisite eligibility period for tenure consideration

[[Page 78]]

and (C) complete the requisite eligibility period to receive retirement 
benefits, prior to reaching the mandatory retirement age of 65 
prescribed by the Act.
    (iii) Service. (A) On the date of application, an applicant must 
have completed a minimum of 15 years of professional work experience, 
including at least 5 years of service in a position of responsibility in 
a Federal Government agency or agencies or elsewhere equivalent to that 
of a Mid-Level Foreign Service officer (classes FS-1 through FS-3). The 
duties and responsibilities of the position occupied by the applicant 
must have been similar to or closely related to that of a Foreign 
Service officer in terms of knowledge, skills, abilities, and overseas 
work experience. In addition, an applicant must currently be in, or have 
been in, a position comparable to a Foreign Service officer of class 1 
(FS-1), or higher.
    (B) Applicants from outside the Federal Government, and Federal 
employees who at the time of application lack the 15 years of 
professional work experience or the 5 years of service in a position of 
responsibility as defined in the preceding paragraph, may, however, be 
considered if they are found to possess a combination of educational 
background, professional work experience, and skills needed by the 
Foreign Service at the Senior Level in employment categories which 
normally are not staffed by promotion of Mid-Level career officers.
    (C) Non-career members of the Senior Foreign Service of a Federal 
Government department or agency also may apply for the Senior Career 
Candidate Program if they meet the eligibility requirements for the 
program.
    (iv) Certification of need. Before an application can be processed, 
the Director of Personnel of the foreign affairs agency concerned must 
certify that there is a need for the applicant as a Senior Career 
Candidate based upon (A) the projections of personnel flows and needs 
mandated by section 601(c)(2) of the Act, and (B) a finding that the 
combination of educational background, professional work experience, and 
skills possessed by the applicant is not expected to be available in the 
immediate future in sufficient numbers within the Senior Foreign 
Service, including by promotion and/or special training of career 
personnel. This certification of need will be requested by the Board of 
Examiners for the Foreign Service from the appropriate foreign affairs 
agency Director of Personnel.
    (2) Application. All applicants for the Senior Career Candidate 
Program must apply in writing through the prospective employing agency 
to the Board of Examiners for consideration. The applicant shall submit 
a completed Standard Form 171, ``Personnel Qualifications Statement,'' 
and Form DSP-34, ``Supplement to Application for Federal Employment,'' 
to the Board. In addition, the applicant shall submit a narrative 
statement, not exceeding four typewritten pages in length, describing 
the applicant's pertinent background and professional work experience, 
which includes a statement of the applicant's willingness and ability to 
accept the obligation of world-wide service. The Board may request 
additional written information from the applicant following receipt of 
the initial application.
    (3) Qualifications evaluation panel. (i) The Board of Examiners will 
establish a file for each applicant, placing in it all available 
documentation of value in evaluating the applicant's potential for 
service as a Senior Career Candidate. For an applicant from within the 
Federal Government, this will include the personnel file from the 
employing department or agency.
    (ii) The complete file will be reviewed by a Qualifications 
Evaluation Panel of the Board of Examiners to determine whether the 
applicant meets the statutory and other eligibility requirements, to 
assess the applicant's skills under the certification of need issued by 
the prospective employing agency, and to recommend whether the applicant 
should be examined for possible appointment as a Senior Career 
Candidate. If the Qualifications Evaluation Panel decides that the 
applicant is not eligible for examination, the prospective employing 
agency shall be informed by the Board of the reasons for that decision.
    (4) Written Examination. The Board of Examiners normally will not 
require

[[Page 79]]

Senior Career Candidate applicants to undergo a written examination. 
However, the Board may, upon securing the agreement of the prospective 
employing agency, decide that such applicants should be required to take 
an appropriate written examination prescribed by the Board. If so, an 
applicant whose score on the written examination is at or above the 
passing level set by the Board will be eligible for selection for the 
oral examination.
    (5) Oral examination--(i) Examining panel. Applicants recommended by 
the Qualifications Evaluation Panel will be given an appropriate oral 
examination by a Panel of Senior Foreign Service deputy examiners of the 
Board of Examiners. The Oral Examining Panel shall be composed of at 
least two deputy examiners who are Senior Foreign Service career 
officers of the prospective employing agency, and at least one deputy 
examiner who is a Senior Foreign Service career officer from another 
foreign affairs agency operating under the Foreign Service Act. The 
Examining Panel shall be chaired by a deputy examiner who is a Senior 
Foreign Service career officer of the prospective employing agency. At 
least one of the Examining Panel members shall represent the functional 
or specialist field for which the applicant is being examined. 
Determinations of duly constituted panels of deputy examiners are final, 
unless modified by specific action of the Board of Examiners.
    (ii) Criteria. (A) The Examining Panel will question the applicant 
regarding the indicated functional or specialist field and other matters 
relevant to the applicant's qualifications for appointment as a Senior 
Career Candidate. Prior to the oral examination, the applicant will be 
asked to write an essay, on a topic related to Foreign Service work, to 
enable the Examining Panel to judge the applicant's effectiveness of 
written expression. This essay requirement may be waived at the request 
of the head of the prospective employing agency, if, for example, the 
applicant is a career member of the Senior Executive Service.
    (B) The oral examination will be conducted under written criteria, 
established in consultation with the prospective employing agency and 
publicly announced by the Board of Examiners. The examination will seek 
to determine the ability of the applicant to meet the objective of 
section 101 of the Act, which provides for a Senior Foreign Service 
``characterized by strong policy formulation capabilities, outstanding 
executive leadership qualities, and highly developed functional, foreign 
language, and area expertise.''
    (iii) Grading. Applicants taking the oral examination will be graded 
as ``recommended,'' or ``not recommended'' by the Examining Panel. Those 
graded as ``recommended'' also will be given a numerical score, under 
the standard Board of Examiners scoring criteria, for use by the Final 
Review Panel.
    (6) Background investigation. Senior Career Candidate applicants 
recommended by the Examining Panel will be subject to the same 
background investigation as required for Junior and Mid-Level Foreign 
Service Officer Career Candidates. The background investigation shall be 
conducted to determine suitability for appointment to the Foreign 
Service.
    (7) Medical examination. Senior Career Candidate applicants 
recommended by the Examining Panel, and their dependents, will be 
subject to the same medical examination as required for the Junior and 
Mid-Level Foreign Service Career Candidates. The medical examination 
shall be conducted to determine the applicant's physical fitness to 
perform the duties of a Foreign Service officer on a world-wide basis 
and, for applicants and dependents, to determine the presence of any 
physical, neurological, or mental condition of such a nature as to make 
it unlikely that they would be able to function on a world-wide basis. 
Applicants and/or dependents who do not meet the required medical 
standards may be given further consideration, as appropriate, under the 
procedures of the prospective employing agency.
    (8) Foreign language requirement. Applicants recommended by the 
Examining Panel will be required to take a subsequent examination to 
measure their fluency in foreign languages, and/or their aptitude for 
learning them.

[[Page 80]]

Senior Career Candidates will be subject to the foreign language 
requirements established for their occupational category by their 
prospective employing agency. Senior Career Candidate applicants for the 
Foreign Commercial Service must demonstrate proficiency by examination 
in two foreign languages. United States Information Agency Senior Career 
Candidates, other than Senior Specialist Career Candidates, must 
demonstrate proficiency in at least one foreign language. Except for the 
Foreign Commercial Service and the United States Information Agency, an 
applicant may be appointed without first having passed an examination in 
a foreign language, but the appointed Senior Career Candidate may not be 
commissioned as a Career Senior Foreign Service officer unless adequate 
proficiency in a foreign language is achieved. This language requirement 
will not apply to candidates in occupational categories which, in the 
judgment of the prospective employing agency, do not require foreign 
language proficiency.
    (9) Final review panel. (i) The entire file of an applicant 
recommended by the Examining Panel will be reviewed and graded by a 
Final Review Panel, after the results of the background investigation, 
medical examination and language examination are received. The Final 
Review Panel will decide whether or not to recommend the applicant for 
appointment, taking into account all of the available information 
concerning the applicant.
    (ii) The Final Review Panel shall consist of a chairperson who shall 
be a Deputy Examiner who is a career Senior Foreign Service officer of 
the prospective employing agency, and at least two other Deputy 
Examiners of the Board of Examiners. Of the Deputy Examiners serving on 
the Final Review Panel, the majority shall be career Senior Foreign 
Service officers of the prospective employing agency; and at least one 
shall be a career Senior Foreign Service officer of one of the other 
foreign affairs agencies operating under the Act.
    (10) Certification of appointment. The file of an applicant 
recommended by the Final Review Panel will be submitted to the Board of 
Examiners for consideration and approval. An applicant found by the 
Board to meet the standards for appointment as a Senior Foreign Service 
Career Candidate shall be so certified to the Director of Personnel of 
the prospective employing agency.
    (c) Limited non-career appointments. (1) Other Senior Foreign 
Service appointments may be made on a limited non-career basis for 
individuals who do not wish to compete for career appointments, but for 
whom a need can be certified by the Director of Personnel of the foreign 
affairs agency concerned. Such limited non-career senior appointees will 
be subject to the eligibility requirements set forth in Sec. 11.30(b)(1) 
(i) and (iv). The maximum age set forth in Sec. 11.30(b)(1)(ii) does not 
apply to such appointments. However, because Foreign Service members 
generally are subject to the mandatory retirement age of 65, under 
section 812 of the Act, limited non-career Senior appointments normally 
will not extend beyond the appointee's 65th birthday. Limited non-career 
appointees of the Department of Commerce and the United States 
Information Agency will not be subject to the language requirements of 
Sec. 11.30(b)(8). Applicants for limited non-career senior appointments 
will be subject to the same background investigation and medical 
examination required of career candidates, but normally they will not be 
subject to a written or oral examination, or to approval by the Board of 
Examiners. Processing procedures for such applicants will be established 
by the Director of Personnel of the foreign affairs agency concerned. 
Their appointments normally will be limited to the duration of the 
specific assignments for which they are to be hired, may not exceed 5 
years in duration, and may not be renewed or extended beyond 5 years.
    (2) Prior to the expiration of their limited non-career senior 
appointments, if they meet all the eligibility requirements set forth in 
Sec. 11.30(b)(1), such individuals may elect to compete for career 
candidate status in the Senior Foreign Service by qualifying at that 
time for and taking the examinations required of career candidates. If 
appointed as career candidates, the

[[Page 81]]

length of service under their previous limited non-career appointments 
may be counted under the procedures of the employing agency as part of 
the trial period of service prescribed before a career candidate can 
receive a career appointment. The total period of limited appointment 
(non-career and career candidate) of such individuals may not exceed 5 
years in duration.
    (3) Nothing in this section will limit the right of an individual 
who has previously served as a limited non-career senior appointee from 
subsequently applying for consideration as a new applicant and being 
appointed as a Senior Career Candidate after a limited non-career 
appointment has expired.
    (d) Reporting requirement. The Director of Personnel of each foreign 
affairs agency shall report annually to the Director General of the 
Foreign Service, Department of State, the number and nature of the 
limited Senior Foreign Service appointments (non-career and career 
candidates) made by that agency under these regulations.

(Secs. 206(a) and 301(b), Foreign Service Act of 1980 (secs. 206(a) and 
301(b), Pub. L. 96-465, 94 Stat. 2079 and 2083 (22 U.S.C. 3926 and 
3941)))
[48 FR 38607, Aug. 25, 1983]



PART 12--COMPLAINTS AGAINST EMPLOYEES BY ALLEGED CREDITORS--Table of Contents




Sec.
12.1  No cognizance taken of complaint.
12.2  Claimants denied access to employees.



Sec. 12.1  No cognizance taken of complaint.

    The Department of State will take no cognizance of a complaint 
against an employee by an alleged creditor, so far as the complainant is 
concerned, beyond acknowledging receipt of his communication.

(Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658)
[22 FR 10789, Dec. 27, 1957]



Sec. 12.2  Claimants denied access to employees.

    Persons claiming to be creditors or collectors of debts or claims 
will be denied access to employees for the purpose of presenting or 
collecting claims during the hours set apart for the transaction of 
public business or while the employees concerned are on duty.

(Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658)
[22 FR 10789, Dec. 27, 1957]



PART 13--PERSONNEL--Table of Contents




Sec.
13.1  Improper exaction of fees.
13.2  Embezzlement.
13.3  Liability for neglect of duty or for malfeasance generally; action 
          on bond; penalty.
13.4  False certificate as to ownership of property.

    Authority:  Sec. 302, 60 Stat. 1001; 22 U.S.C. 842.

    Source:  22 FR 10789, Dec. 27, 1957, unless otherwise noted.



Sec. 13.1  Improper exaction of fees.

    Any consular officer who collects, or knowingly allows to be 
collected, for any services any other or greater fees than are allowed 
by law for such services, shall, besides his or her liability to refund 
the same, be liable to pay to the person by whom or in whose behalf the 
same are paid, treble the amount of the unlawful charge so collected, as 
a penalty. The refund and penalty may be recovered with costs, in any 
proper form of action, by such person for his or her own use. The amount 
of such overcharge and penalty may at the discretion of the Secretary of 
the Treasury be ordered withheld from the compensation of such officer 
for payment to the person entitled to the same (22 U.S.C. 1189).

    Note: The foregoing relates to improper collection and personal 
withholding of funds by consular officers. For procedure where a 
collection, having been erroneously made, has been returned by the 
officer to the Treasury in good faith, making a subsequent accounting 
adjustment necessary, see Sec. 22.4, Refund of fees of this chapter.

(22 U.S.C. 2658 and 3926)
[22 FR 10789, Dec. 27, 1957, as amended at 49 FR 16989, Apr. 23, 1984]

[[Page 82]]



Sec. 13.2  Embezzlement.

    Every consular officer who shall receive money, property, or effects 
belonging to a citizen of the United States and shall not within a 
reasonable time after demand made upon him or her by the Secretary of 
State or by such citizen, his or her executor, administrator, or legal 
representative, account for and pay over all moneys, property, and 
effects, less his or her lawful fees, due to such citizen, shall be 
deemed guilty of embezzlement, and shall be punishable by imprisonment 
for not more than five years, and by a fine of not more than $2,000 (22 
U.S.C. 1198). Penalties of imprisonment and fine are also prescribed for 
embezzlement in connection with the acceptance, without execution of a 
prescribed form of bond, of appointment from any foreign state as 
administrator, guardian, or to any other office of trust for the 
settlement or conservation of estates of deceased persons or of their 
heirs or of persons under legal disabilities (22 U.S.C. 1178 and 1179). 
Acceptance of such appointments is not ordinarily permitted under 
existing regulations. See Sec. 92.81 of this chapter.

(22 U.S.C. 2658 and 3926)
[22 FR 10789, Dec. 27, 1957, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 13.3  Liability for neglect of duty or for malfeasance generally; action on bond; penalty.

    Whenever any consular officer willfully neglects or omits to perform 
seasonably any duty imposed upon him or her by law, or by any order or 
instruction made or given in pursuance of law, or is guilty of any 
willful malfeasance or abuse of power, or of any corrupt conduct in his 
or her office, he or she shall be liable to all persons injured by any 
such neglect, or omission, malfeasance, abuse, or corrupt conduct, for 
all damages, occasioned thereby; and for all such damages, he or she and 
his or her sureties upon his or her official bond shall be responsible 
thereon to the full amount of the penalty thereof to be sued in the name 
of the United States for the use of the person injured. Such suit, 
however, shall in no case prejudice, but shall be held in entire 
subordination to the interests, claims, and demands of the United 
States, as against any officer, under such bond, for every willful act 
of malfeasance or corrupt conduct in his or her office. If any consul 
neglects or omits to perform seasonably the duties imposed upon him or 
her by the laws regulating the shipment and discharge of seamen, or is 
guilty of any malversation or abuse of power, he or she shall be liable 
to any injured person for all damage occasioned thereby; and for all 
malversation and corrupt conduct in office, he or she shall be 
punishable by imprisonment for not more than five years and not less 
than one, and by a fine of not more than $10,000 and not less than 
$1,000 (22 U.S.C. 1199).

(22 U.S.C. 2658 and 3926)
[22 FR 10789, Dec. 27, 1957, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 13.4  False certificate as to ownership of property.

    If any consul of vice consul falsely and knowingly certifies that 
property belonging to foreigners is property belonging to citizens of 
the United States, he or she shall be punishable by imprisonment for not 
more than three years, and by a fine of not more than $10,000 (22 U.S.C. 
1200).

(22 U.S.C. 2658 and 3926)
[22 FR 10789, Dec. 27, 1957, as amended by Dept. Reg. 108.838, 49 FR 
16989, Apr. 23, 1984]



PART 16--FOREIGN SERVICE GRIEVANCE SYSTEM--Table of Contents




Sec.
16.1  Definitions.
16.2  General provisions.
16.3  Access to records.
16.4  Time limits for grievance filing.
16.5  Relationship to other remedies.
16.6  Security clearances.
16.7  Agency procedures.
16.8  Agency review.
16.9  Records.
16.10  Foreign Service Grievance Board.
16.11  Grievance Board consideration of grievances.
16.12  Hearing.
16.13  Decisions.
16.14  Reconsideration of a grievance.
16.15  Judicial review.

    Authority:  Sec. 4 of the Act of May 26, 1949, as amended (63 Stat. 
111; 22 U.S.C. 2658);

[[Page 83]]

Pub. L. 94-141 (89 Stat. 765); 22 U.S.C. 1037; sec. 10 of E.O. 11636 (36 
FR 24901).

    Source:  41 FR 13912, Apr. 1, 1976, unless otherwise noted.



Sec. 16.1  Definitions.

    (a) Act means the Foreign Service Act of 1946, as amended.
    (b) Grievant means any officer or employee of the Service who is a 
citizen of the United States; or for purposes of paragraphs (c) (7) and 
(8) of this section, a former officer or employee of the Service; or in 
the case of death of the officer or employee, a surviving spouse or 
dependent family member of the officer or employee.
    (c) Grievance means any act or condition subject to the control of 
the Foreign Affairs agencies (the Department of State, the Agency for 
International Development, or the U.S. Information Agency) which is 
alleged to deprive the grievant of a right or benefit authorized by law 
or regulation or is otherwise a source of concern or dissatisfaction to 
the grievant, including, but not limited to the following:
    (1) Complaints against separation of an officer or employee 
allegedly contrary to law or regulation or predicated upon alleged 
inaccuracy (including inaccuracy resulting from omission or any relevant 
and material document), error, or falsely prejudicial character of any 
part of the grievant's official personnel record;
    (2) Other alleged violation, misinterpretation, or misapplication of 
applicable law, regulation, or published policy affecting the terms and 
conditions of the grievant's employment or career status;
    (3) Allegedly wrongful disciplinary action against an employee 
constituting a reprimand or suspension from official duties;
    (4) Dissatisfaction with any matter subject to the control of the 
agency with respect to the grievant's physical working environment;
    (5) Alleged inaccuracy, error, or falsely prejudicial material in 
the grievant's official personnel file;
    (6) Action alleged to be in the nature of reprisal or other 
interference with freedom of action in connection with an employee's 
participation under these grievance procedures;
    (7) When the grievant is a former officer who was involuntarily 
retired pursuant to sections 633 and 634 of the Act within 6 years prior 
to December 1, 1975, ``grievance'' shall mean a complaint that such 
involuntary retirement violated applicable law or regulation effective 
at the time of the retirement or that the involuntary retirement was 
predicated directly upon material contained in the grievant's official 
personnel file alleged to be erroneous or falsely prejudicial in 
character; and
    (8) When the grievant is a former officer or employee or a surviving 
spouse or dependent family member of a former officer or employee, 
``grievance'' shall mean a complaint that an allowance or other 
financial benefit has been denied arbitrarily, capriciously or contrary 
to applicable law or regulation.
    (d) Grievance does not include the following:
    (1) Complaints against individual assignment or transfers of Foreign 
Service officers or employees, which are ordered in accordance with law 
and regulation (see also paragraph (c)(2) of this section);
    (2) Judgments of Selection Boards rendered pursuant to section 623 
of the Act, or of equivalent bodies, in ranking Foreign Service officers 
and employees for promotion on the basis of merit, or judgments in 
examinations prescribed by the Board of Examiners pursuant to section 
516 or 517 of the Act (see also paragraph (c)(2) of this section);
    (3) Termination of time-limited appointments pursuant to 22 U.S.C. 
929 and 1008, and the pertinent regulations prescribed by the employing 
agency (see also paragraph (c)(2) of this section);
    (4) Any complaints or appeals for which a specific statutory appeals 
procedure exists (see appendix A for examples).

A grievance filed under these procedures may be based on matters for 
which there is a specific statutory appeals procedure which is 
applicable to the Foreign Service grievant. Should the jurisdiction of 
the Grievance Board over a specific grievance be placed into question on 
grounds that the basis of

[[Page 84]]

the grievance is not encompassed within the Board's authority 
(Sec. 16.1(d)(4) and Appendix A), the Board shall consult with the other 
statutory body concerned, transmitting the views of the parties 
concerned before determining whether it has jurisdiction.
    (e) Employee organization means any employee organization accorded 
recognition as the excusive employee representative pursuant to 
Executive Order 11636 dated December 17, 1971.
    (f) Grievance Board or Board means the full Foreign Service 
Grievance Board, or a Panel or member thereof, as appropriate.
    (g) Party means the grievant or the Foreign Affairs agency having 
control over the act or condition forming the subject matter of the 
grievance.
    (h) Bureau means equivalent organizational elements in State and 
USIA, and includes offices in AID.
    (i) Days means calendar days.



Sec. 16.2  General provisions.

    (a) Statement of purpose. These regulations establish procedures as 
required by law to provide Foreign Service officers and employees (and 
their survivors) of the Foreign Affairs agencies, a grievance procedure 
to insure a full measure of due process, and to provide for the just 
consideration and resolution of grievances of such officers, employees, 
and survivors. No regulation promulgated in this part shall be 
interpreted or applied in any manner which would alter or abridge the 
provisions of the due process established by the Congress in Pub. L. 94-
141, 22 U.S.C. 1037, section 691.
    (b) Discussion of complaints. (1) Every effort should be made to 
settle any employee complaint informally, promptly, and satisfactorily.
    (2) Supervisors and other responsible officers should encourage 
employees to discuss complaints with them and should respond in a timely 
manner to resolve the complaints.
    (3) An employee initially should discuss a complaint with the 
employee's current supervisor or with the responsible officer who has 
immediate jurisdiction over the complaint to give that person an 
opportunity to resolve the matter, before further steps are taken under 
these procedures.
    (c) Guidance. Nothing in these procedures prevents a grievant from 
seeking guidance from any official who might be helpful respecting the 
submission of a grievance or its resolution.
    (d) Freedom of action. (1) Any grievant, witness, representative or 
other person involved in a proceeding hereunder shall be free from any 
restraint, interference, coercion, harassment, discrimination, or 
reprisal in those proceedings or by virtue of them. The Foreign Affairs 
agencies recognize their obligation to insure compliance with this 
section. Any person involved or having immediate knowledge of any 
alleged breach of this section should call it to the attention of the 
pertinent foreign affairs agency through appropriate channels for 
corrective action as necessary. Normally such allegations should be 
brought to the attention of the senior agency official at the post; and 
at Washington, DC, to the Director, Grievance Staff for State; Chief, 
Employee Relations Branch for AID and Chief, Employee-Management 
Relations Division for USIA.
    (2) The grievant has the right to a representative of the grievant's 
own choosing at every stage of the proceedings. The grievant and repre- 
sentative(s) who are under the control, supervision, or responsibility 
of the Foreign Affairs agencies shall be granted reasonable periods of 
administrative leave to prepare, to be present, and to present the 
grievance.
    (3) Any witness under the control, supervision, or responsibility of 
a Foreign Affairs agency shall be granted reasonable periods of 
administrative leave to appear and testify at any such proceeding.
    (4) The Foreign Service Grievance Board established hereunder shall 
have authority to ensure that no copy of the determination of the agency 
head or designee to reject a Grievance Board recommendation, no notation 
of the failure of the Grievance Board to find for the grievant, and no 
notation that a proceeding is pending or has been held, shall be entered 
in the personnel records of the grievant (unless by order of the 
Grievance Board as a remedy for the grievance) or those of any other 
officer or employee connected the the

[[Page 85]]

grievance. The Foreign Affairs agencies shall maintain grievance records 
under appropriate safeguards to preserve confidentiality (Sec. 16.9).



Sec. 16.3  Access to records.

    (a) Grievance Board records. The grievant and the grievant's 
representative shall have access to the record of proceedings, including 
the decision of the Board.
    (b) Agency records. (1) In considering the validity of a grievance, 
the Grievance Board shall have access, to the extent permitted by law, 
to any agency record considered by the Board to be relevant to the 
grievant and the subject matter of the grievance.
    (2) The agency shall, subject to applicable law, promptly furnish 
the grievant any agency record which the grievant requests to 
substantiate the grievance and which the agency or the Grievance Board 
determines is relevant and material to the proceeding. When deemed 
appropriate by the agency or the Board, a grievant may be supplied with 
only a summary of extract of classified material. If a request by a 
grievant for a document is denied prior to or during the agency's 
consideration of a grievance, such denial may be raised by the grievant 
as an integral part of the grievance before the Board.
    (3) These regulations do not require disclosure of any official 
agency record to the Grievance Board or a grievant where the head of 
agency or deputy determines in writing that such disclosure whould 
adversely affect the foreign policy or national security of the United 
States.



Sec. 16.4  Time limits for grievance filing.

    (a) A grievance concerning a continuing practice or condition may be 
presented at any time if its adverse effect is presently continuing. 
Documents contained in official employee personnel files, for example, 
shall be deemed to constitute a continuing condition.
    (b) Subject to paragraph (a) of this section, a grievance under 
these regulations is forever barred, and the Grievance Board shall not 
consider or resolve the grievance, unless the grievance is presented 
within a period of 3 years after the occurrence or occurrences giving 
rise to the grievance, except that if the grievance arose earlier than 2 
years prior to the effective date of these regulations, the grievance 
shall be so barred, and no considered and resolved, unless it is 
presented within a period of 2 years after the effective date of these 
regulations, There shall be excluded from the computation of any such 
period any time during which the grievant was unaware of the grounds 
which are the basis of the grievance and could not have discovered such 
grounds if the grievant had exercised, as determined by the Grievance 
Board, reasonable diligence.
    (c) A grievance shall be deemed presented to the responsible 
official (Sec. 16.7(b)), transmitted to post or bureau (Sec. 16.7(c)) 
submitted for agency review (Sec. 16.8) or filed with the Grievance 
Board Sec. 16.11(a):
    (1) On the date of its dispatch by telegram, registered or certified 
mail, or receipted mail, in a diplomatic pouch;
    (2) On the date of its arrival at the appropriate office, if 
delivered by any other means.



Sec. 16.5  Relationship to other remedies.

    (a) A grievant may not file a grievance under these procedures if 
the grievant has formally requested, prior to filing a grievance, that 
the matter or matters which are the basis of the grievance be considered 
or resolved and relief be provided, under another provision of law, 
regulation, or executive order, and the matter has been carried to final 
decision thereunder on its merits or is still under consideration.
    (b) If a grievant is not prohibited from filing a grievance under 
these regulations by paragraph (a) of this section, the grievant may 
file under these regulations notwithstanding the fact that such 
grievance may be eligible for consideration, resolution, and relief 
under a regulation or executive order other than under these 
regulations, but such election of remedies shall be final upon the 
acceptance of jurisdiction by the Board.



Sec. 16.6  Security clearances.

    The agencies shall use their best endeavors to expedite security 
clearances whenever necessary to ensure a fair and prompt investigation 
and hearing.

[[Page 86]]



Sec. 16.7  Agency procedures.

    (a) Initial consideration. (1) Grievances shall be considered 
through the steps provided in this section before they are filed with 
the Grievance Board.
    (2) During the pendency of agency procedures under this section, the 
grievant may request a suspension of the proposed action of the 
character of separation or termination of the grievant, disciplinary 
action against the grievant, or recovery from the grievant of alleged 
overpayment of salary, expenses or allowances, which is related to the 
grievance. The request must be in writing and addressed to the 
responsible official of the agencies, as designated in Sec. 16.8(a)(2) 
stating the reasons for such suspension. If the request is related to 
separation or termination of the grievant, and the agency considers that 
the grievance is not frivolous and is integral to the proposed action, 
the agency shall suspend its proposed action until completion of agency 
procedures, and for a period thereafter if necessary, consistent with 
paragraph (a) of Sec. 16.11, to permit the grievant to file a grievance 
with the Board, and to request interim relief under paragraph (c) of 
Sec. 16.11. If a request is denied, the agency shall provide the 
grievant in writing the reason for denial. Nothing in these regulations 
shall be deemed to preclude an employee from requesting the suspension 
of any proposed action.
    (b) Consideration by responsible officer. (1) While every effort 
should be made to resolve a complaint by an initial discussion between 
an employee and the supervisor or responsible officer, an employee may 
present the complaint as a grievance by submitting it in writing, to 
that person. (The term ``responsible officer'' as used herein includes 
any appropriate officer who has immediate jurisdiction over the 
complaint.) The presentation shall include a description of the act or 
condition which is the subject of the grievance; its effect on the 
grievant; any provision of law, regulation, or agency policy which the 
grievant may believe was violated or misapplied; any documentary 
evidence readily available to the grievant on which the grievance rests; 
the identity of individuals having knowledge of relevant facts; and a 
statement of the remedial action requested.
    (2) The responsible officer, whenever possible, shall use 
independent judgment in deciding whether the grievance is meritorious 
and what the resolution of it should be. Within 15 days from receipt of 
the written grievance, the responsible officer shall provide the 
grievant with a written response, which shall include a statement of any 
proposed resolution of the grievance.
    (3) If the response denies in whole or in part the remedial action 
requested, such response shall notify the grievant of the time within 
which to appeal the decision, and identity of the senior official, or 
designee, to whom the appeal should be addressed. In those cases in 
which the senior official, or designee, is the responsible officer to 
whom the grievance was initially presented or has participated in the 
decision process and has formally approved the written response of the 
responsible officer, the grievant shall be so notified and advised that 
the grievance may be submitted directly to the agency for review under 
Sec. 16.8.
    (c) Bureau or post review. (1) If the responsible officer's written 
response does not resolve the grievance to the grievant's satisfaction, 
within 10 days of receiving it (or, if no response is received, within 
25 days after first presenting the grievance), the grievant may pursue 
the grievance by transmitting it in writing to the senior official, or 
the designee in the bureau or post which has authority to resolve the 
grievance. The written transmission shall include all the information 
required by paragraph (b)(1) of this section and copies of any 
correspondence under paragraphs (b) (2) and (3) of this section.
    (2) Within 15 days from receipt of the grievance that official shall 
provide the grievant with a written decision, including any proposed 
resolution of the grievance. If the decision denies in whole or in part 
the remedial action requested, the communication shall notify the 
grievant of the time within which to submit the grievance for agency 
review and the identity of the appropriate agency official to whom the 
grievance should be addressed.

[[Page 87]]



Sec. 16.8  Agency review.

    (a) Submission. (1) An employee may submit the grievance for agency 
review if the grievance (i) is not within the jurisdiction of a post or 
bureau, or (ii) the grievance has been considered but not resolved to 
the grievant's satisfaction within the post or bureau as provided in 
Sec. 16.7(c) within 10 days after receipt of the post's or bureau's 
decision (or, if no response is received, within 25 days after 
presenting it to the senior official or the designee). The grievant 
shall submit it in writing to the responsible official of the agency 
which has control of the act or condition which is the subject of the 
grievance.
    (2) Responsible officials. The responsible officials of the agencies 
are the Deputy Assistant Secretary for Personnel (State), the Director 
of Personnel and Manpower (AID), and the Chief, Employee-Management 
Relations Division (USIA).
    (3) Contents. (i) A request for agency review shall include a 
description of the act or condition which is the subject of the 
grievance; its effect on the grievant; any provision of law, regulation 
or agency policy which the grievant may believe was violated or 
misapplied; copies of any correspondence under Sec. 16.7(a), any 
documentary evidence readily available to the grievant on which the 
grievance rests; the identity of individuals having knowledge of 
relevant facts; and a statement of the remedial action requested.
    (ii) The responsible official shall review the grievance on the 
basis of available documentary evidence, and, in that official's 
discretion, interview persons having knowledge of the facts. The agency 
review shall be completed and its decision dispatched within 90 days 
from the date of the initial written presentation of the grievance. The 
grievant shall be informed in writing of the findings of the responsible 
official and any proposed resolution of the grievance. The communication 
shall also include the time within which the grievant may file a 
grievance with the Grievance Board and the appropriate procedure to be 
followed in this respect.



Sec. 16.9  Records.

    All official records concerning agency consideration of grievances, 
except those appropriate to implementation of decisions favorable to 
grievants, shall be kept separate from the official personnel record of 
the grievant and any other individuals connected with the grievance, and 
shall not be accessible to agency personnel other than the grievant, the 
grievant's representative, and those responsible for consideration of 
grievances.



Sec. 16.10  Foreign Service Grievance Board.

    (a) Establishment and composition. There is hereby established a 
Foreign Service Grievance Board for the Department of State, the Agency 
for International Development and the U.S. Information Agency to 
consider and resolve grievances under these procedures.
    (b) The Grievance Board shall consist of not less than 5 members nor 
more than 15 members (including a chairperson) who shall be independent, 
distinguished citizens of the United States, well known for their 
integrity, who are not active officers, employees, or consultants of the 
Foreign Affairs agencies (except consultants who served as public 
members of the Interim Grievance Board previously established under 
section 660, Volume 3, Foreign Affairs Manual) but may be retired 
officers or employees. On its initial establishment, the Board shall 
consist of 15 members including chairperson.
    (c) The Board may act by or through panels or individual members 
designated by the chairperson, except that hearings within the 
continental United States shall be held by panels of at least three 
members unless the parties agree otherwise. Reference in these 
regulations to the Grievance Board shall be considered to be reference 
to a panel or member of the Grievance Board where appropriate. All 
members of the Grievance Board shall act as impartial individuals in 
considering grievances.
    (d) The members of the Grievance Board, including the chairperson, 
shall be appointed by the Secretary of State after being designated by 
the written

[[Page 88]]

agreement of the Foreign Affairs agencies and the employee organization.
    (e) The Board chairperson and other members shall be appointed for 
terms of 2 years, subject to renewal upon the agreement of the Foreign 
Affairs agencies and the employee organization; except that the terms of 
7 of the initially appointed members shall expire at the end of one 
year.
    (f) Any vacancies shall be filled by the Secretary of State upon the 
nomination by the Board following the agreement of the agencies and the 
employee organization.
    (g) Compensation. Members, including the chairperson, who are not 
employees of the Federal Government shall receive compensation for each 
day they are performing their duties as members of the Grievance Board 
(including travel time) at the daily rate paid an individual at GS-18 
level of the General Schedule under section 5332 of title 5 of the 
United States Code.
    (h) Removal. Grievance Board members shall be subject to removal by 
the Secretary of State for corruption, other malfeasance, or the 
demonstrated incapacity to perform their functions. No member shall be 
removed from office until after the Board of the Foreign Service has 
conducted a hearing and made its recommendations in writing to the 
Secretary of State, except where the right to a hearing is waived in 
writing. The Board of the Foreign Service shall provide a member with 
full notice of the charges against that member, and afford a member the 
right to counsel, to examine and cross-examine witnesses, and to present 
documentary evidence.
    (i) Grievance Board procedures. In accordance with part J, title VI 
of the Act, the Board may adopt regulations concerning the organization 
of the Board and such other regulations as mey be necessary to govern 
its proceedings.
    (j) Board facilities and staff support. The Grievance Board may 
obtain facilities, services, and supplies through the general 
administrative services of the Department of State. All expenses of the 
Board, including necessary costs of the grievant's travel and travel-
related expenses, shall be paid out of funds appropriated to the 
Department for obligation and expenditure by the Board. At the request 
of the Board, officers and employees on the rolls of the Foreign Affairs 
agencies may be assigned as staff employees to the Grievance Board. 
Within the limit of appropriated funds, the Board may appoint and fix 
the compensation of such other employees as the Board considers 
necessary to carry out its functions. The officers and employees so 
appointed or assigned shall be responsible solely to the Grievance Board 
and the Board shall prepare the performance evaluation reports for such 
officers and employees. The records of the Grievance Board shall be 
maintained by the Board and shall be separate from all other records of 
the Foreign Affairs agencies.



Sec. 16.11  Grievance Board consideration of grievances.

    (a) Filing of grievance. A grievant whose grievance is not resolved 
satisfactorily under agency procedures (Sec. 16.7) shall be entitled to 
file a grievance with the Grievance Board no later than 60 days after 
receiving the agency decision. In the event that an agency has not 
provided its decision within 90 days of presentation, the grievant shall 
be entitled to file a grievance with the Grievance Board no later than 
150 days after the date of presentation to the agency. The Board may 
extend or waive, for good cause, the time limits stated in this section.
    (b) Exhaustion of agency procedures. In the event that the Grievance 
Board finds that a grievance has not been presented for agency 
consideration or that a grievance has been expanded or modified to 
include materially different elements, the Board shall return the 
grievance to the official responsible for final agency review unless the 
agency waives any objection to Board consideration of the grievance 
without such review.
    (c) Prescription of interim relief. If the Grievance Board 
determines that the agency is considering any action of the character of 
separation or termination of the grievant, disciplinary action against 
the grievant, or recovery from the grievant of alleged overpayment of 
salary, expenses, or allowances, which is related to a grievance pending 
before

[[Page 89]]

the Board, and that such action should be suspended, the agency shall 
suspend such action until the Board has ruled upon the grievance. 
Notwithstanding such suspension of action, the head of the agency 
concerned or a chief of mission or principal officer may exclude an 
officer or employee from official premises or from the performance of 
specified duties when such exclusion is determined in writing to be 
essential to the functioning of the post or office to which the officer 
or employee is assigned.
    (d) Inquiry into grievances. The Board shall conduct a hearing at 
the request of a grievant in any case which involves disciplinary 
action, or a grievant's retirement from the Service under sections 633 
and 634 of the Act, or which in the judgment of the Board can best be 
resolved by a hearing or by presentation of oral argument. In those 
grievances in which the Board holds no hearing, the Board shall offer to 
each party the opportunity to review and to supplement, by written 
submission, the record of proceedings prior to its decision.



Sec. 16.12  Hearing.

    (a) Appearances and representation. The grievant, a reasonable 
number of representatives of the grievant's own choosing, and a 
reasonable number of agency representatives, are entitled to be present 
at the hearing. The Grievance Board may, after considering the views of 
the parties and any other individuals connected with the grievance, 
decide that a hearing should be open to others.
    (b) Conduct of hearing. (1) Testimony at a hearing shall be given by 
oath or affirmation which any Board member or person designated by the 
Board shall have authority to administer.
    (2) Each party shall be entitled to examine and cross-examine 
witnesses at the hearing or by deposition, and to serve interrogatories 
answered by the other party unless the Board finds such interrogatory 
irrelevant or immaterial. Upon request of the Board, or upon a request 
of the grievant deemed relevant and material by the Board, and agency 
shall promptly make available at the hearing or by deposition any 
witness under its control, supervision or responsibility, except that if 
the Board determines that the presence of such witness at the hearing is 
required for just resolution of the grievance, then the witness shall be 
made available at the hearing, with necessary costs and travel expenses 
provided by the agency.
    (3) During any hearings held by the Board, any oral or documentary 
evidence may be received but the Board shall exclude any irrelevant, 
immaterial, or unduly repetitious evidence normally excluded in hearings 
conducted under the Administrative Procedures Act (5 U.S.C. 556).
    (4) A verbatim transcript shall be made of any hearing and shall be 
part of the record of proceedings.



Sec. 16.13  Decisions.

    (a) Upon completion of the hearing or the compilation of such record 
as the Board may find appropriate in the absence of a hearing, the board 
shall expeditiously decide the grievance on the basis of the record of 
proceedings. In each case the decision of the Board shall be in writing, 
shall include findings of fact, and shall include the reasons for the 
Board's decision.
    (b) If the Grievance Board finds that the grievance is meritorious, 
the Board shall have the authority within the limitations of the 
authority of the head of the agency, to direct the agency:
    (1) To correct any official personnel record relating to the 
grievant which the Board finds to be inaccurate, erroneous, or falsely 
prejudicial;
    (2) To reverse and administrative decision denying the grievant 
compensation including related within-class salary increases pursuant to 
section 625 of the Act or any other perquisite of employment authorized 
by law or regulation when the Board finds that such denial was 
arbitrary, capricious, or contrary to law or regulation;
    (3) To retain in service and employee whose termination would be in 
consequence of the matter by which the employee is aggrieved;
    (4) To reinstate with back pay, under applicable law and 
regulations, an employee where it is clearly established

[[Page 90]]

that the separation or suspension without pay of the employee was 
unjustified or unwarranted;
    (5) To order an extension of the time of an employee's eligibility 
for promotion to a higher class where the employee suffered career 
impairment in consequence of the matter by which the employee is 
aggrieved;
    (6) To order that an employee be provided with facilities relating 
to the physical working environment which the employee has been denied 
arbitrarily, capriciously or in violation of applicable regulation.
    (c) Such orders of the Board shall be final, subject to judicial 
review as provided for in section 694 of the Act, except that 
reinstatement of former officers who have filed grievances under 
Sec. 16.1(c)(7) shall be presented as Board recommendations, the 
decision on which shall be subject to the sole discretion of the agency 
head or designee, who shall take into account the needs of the Service 
in deciding on such recommendations, and shall not be subjected to 
judicial review under section 694 of the Act. The reason(s) for the 
agency head's (or designee's) decision will be conveyed in writing to 
the Board and the grievant.
    (d) If the Board finds that the grievance is meritorious and that 
remedial action should be taken that directly relates to promotion or 
assignment of the grievant, or to other remedial action, including 
additional step increases, not provided for in paragraph (b) of this 
section, or if the Board finds that the evidence before it warrants 
disciplinary action against any officer or employee, it shall make an 
appropriate recommendation to the head of the agency, and forward to the 
head of the agency the record of the Board's proceedings, including the 
transcript of the hearing, if any. The head of the agency (or designee, 
who shall not have direct responsibility for administrative management) 
shall make a written decision to the parties and to the Board on the 
Board's recommendation within 30 days from receipt of the 
recommendation. A recommendation of the Board may be rejected in part or 
in whole if the action recommended would be contrary to law, would 
adversely affect the foreign policy or security of the United States, or 
would substantially impair the efficiency of the Service. If the 
decision rejects the Board's recommendation in part or in whole, the 
decision shall state specifically any and all reasons for such action. 
Pending the decision, there shall be no ex parte communications 
concerning the grievance between the agency head, or designee, and any 
person involved in the grievance proceeding.



Sec. 16.14  Reconsideration of a grievance.

    A grievant whose grievance is found not to be meritorious by the 
Board may obtain reconsideration by the Board only upon presenting newly 
discovered or previously unavailable material evidence not previously 
considered by the Board and then only upon approval of the Board.



Sec. 16.15  Judicial review.

    Any aggrieved party may obtain judicial review of these regulations, 
and revisions thereto, and final actions of the agency head (or 
designee) or the Grievance Board hereunder, in the District Courts of 
the United States, in accordance with the standards set forth in chapter 
7 of title 5 of the United States Code. Section 706 of title 5 shall 
apply without limitation or exception.



PART 17--OVERPAYMENTS TO ANNUITANTS UNDER THE FOREIGN SERVICE RETIREMENT AND DISABILITY SYSTEM--Table of Contents




Sec.
17.1  Definitions.
17.2  General provisions.
17.3  Notice to annuitants.
17.4  Initial determination.
17.5  Standards.
17.6  Notice of decision and right of appeal.
17.7  Appeal.

    Authority:  22 U.S.C. 842; 22 U.S.C. 1061; 22 U.S.C. 2658; and E.O. 
10897 (25 FR 12439).

    Source:  44 FR 47928, Aug. 16, 1979, unless otherwise noted.



Sec. 17.1  Definitions.

    (a) Act means the Foreign Service Act of 1946, as amended.
    (b) Annuitant has the meaning set forth in section 804(1) of the Act 
(22 U.S.C. 1064(1)).

[[Page 91]]

    (c) Foreign Service Grievance Board means the Board established by 
22 CFR 16.10 under sections 691 and 692 of the Act (22 U.S.C. 1037-
1037c).
    (d) Overpayments has the same meaning as in Sec. 822(d) of the Act 
(22 U.S.C. 1076a(d)).
    (e) Secretary means the Secretary of State.



Sec. 17.2  General provisions.

    Section 822(d) of the Act (22 U.S.C. 1076(d)) provides recovery of 
overpayments by the Department of State of benefits to annuitants may 
not be made when, in the judgment of the Secretary, the individual 
recipient is without fault and recovery would be against equity and good 
conscience or administratively infeasible. This part establishes 
procedures for notification to annuitants of their rights, for 
administrative determination of those rights and for appeals of negative 
determinations. This part also establishes procedures by which an 
annuitant can contest a determination that the annuitant has been 
overpaid.



Sec. 17.3  Notice to annuitants.

    The Office of Finance, Department of State, shall give written 
notification to any person who has received an overpayment, the cause of 
the overpayment, the intention of the Department to seek repayment of 
the overpayment, and the basis for that action, the right of the 
annuitant to contest the alleged overpayment or to request a waiver of 
recovery, and the procedure to follow in case of such contest or appeal. 
The notification shall allow at least 30 days from its date within which 
the annuitant may file a written response, which may include evidence, 
argument, or both.



Sec. 17.4  Initial determination.

    (a) The Director of the Office of Finance will be responsible for 
preparing an administrative file as a basis for determination in each 
case where an annuitant contests a claim to recover overpayment or 
requests waiver of recovery. This file shall include: all correspondence 
with the annuitant; documentation on the computation of the annuity or 
annuities in question; and any information available to the Department 
which bears on the application of the standards of waiver of recovery to 
the particular case.
    (b) On the basis of the administrative file, the Director, after 
consultation with and review of the preliminary findings by the Office 
of the Legal Adviser and Office of Employee Relations, Bureau of 
Personnel, shall prepare a preliminary finding. This preliminary finding 
shall contain a positive or negative determination on all material 
issues raised by the contest or request for waiver. In the latter case, 
there shall be a determination of the applicability or non-applicability 
of each of the standards set forth in Sec. 17.5.
    (c) The Director shall make the final administrative determination.
    (d) At any time before the final administrative decision, the 
Director may request the annuitant to supplement his or her submission 
with additional factual information and may request that the annuitant 
authorize the Department of State to have access to bank and other 
financial records bearing on the application of these regulations.



Sec. 17.5  Standards.

    (a) General. (1) Waiver of overpayment will not be allowed in any 
case prior to receipt and evaluation of a statement of financial 
responsibility, duly sworn by the recipient of the overpayment, except 
in those cases where the facts make it obvious that the individual has 
no capacity to repay. Such statement will be waived in the latter case.
    (2) Waiver of overpayment will not be allowed when overpayment has 
been made to an estate.
    (b) Fault. (1) Determinations of ``fault'' or the absence thereof, 
will be made according to the commonly understood and standard concepts 
of equity applicable thereto.
    (2) A prerequisite to waiver of overpayment shall be clear and 
convincing showing that the person from whom recovery would otherwise be 
made did not cause, or was not otherwise responsible for the 
overpayment, i.e., he or she performed no act of commission or omission 
that resulted in the overpayment. Pertinent consideration to be made in 
this area are:

[[Page 92]]

    (i) Whether payment resulted from the individual's incorrect (not 
necessarily fraudulent) statement.
    (ii) Whether he or she knew the payment was erroneous and, if so, 
whether his or her subsequent failure to act resulted from desire or 
ignorance.
    (iii) Whether he or she failed to disclose material facts in his or 
her possession.
    (iv) Whether he or she could have determined that the payment was 
erroneous.
    (c) Equity and good conscience. (1) ``Equity and good conscience'' 
as defined in equity and the commonly understood meaning thereof shall 
be attached to waiver determinations. In addition, the decision must be 
made whether the exercise of waiver of overpayment would be in 
opposition to the basic purpose of title VII of the Foreign Service Act 
(22 U.S.C. 1061, et seq.) and would injure the administration of such 
title.
    (2) The following guides will also be applied, as appropriate:
    (i) Waiver of overpayment may be granted when an individual by 
reason of receipt of the overpayment has: (a ) Relinquished a valuable 
right; or (b ) changed his or her position for the worse.
    (ii) Waiver of overpayment may be granted when the individual has 
consistently acted in good faith regarding the overpayment.
    (iii) Waiver of overpayment cannot be granted when the individual 
has been found to be at fault or if the overpayment has been obtained by 
fraud.



Sec. 17.6  Notice of decision and right of appeal.

    If the annuitant, without good cause shown, fails or refuses to 
produce the requested additional information or authorization, the 
Department of State is entitled to made adverse inferences with respect 
to the matters sought to be amplified, clarified, or verified.
    (a) The final administrative decision shall be reduced to writing 
and the Director shall send it expeditiously to the annuitant.
    (b) If the decision is adverse to the annuitant, the notification of 
the decision shall include a written description of the annuitant's 
rights of appeal to the Foreign Service Grievance Board, including time 
to file, where to file, and applicable procedure.



Sec. 17.7  Appeal.

    The Foreign Service Grievance Board shall entertain any appeal under 
this part in accordance with the regulations of the Board set forth in 
22 CFR part 16. The Director of the Office of Finance, with such 
assistance as may be necessary, shall represent the Department in 
proceedings before the Board. The decision of the Board is final.



PART 18--REGULATIONS CONCERNING POST EMPLOYMENT CONFLICT OF INTEREST--Table of Contents




                      Subpart A--General Provisions

Sec.
18.1  Scope.
18.2  Definitions.
18.3  Director General.
18.4  Records.

                       Subpart B--Applicable Rules

18.5  Interpretative standards; advisory opinions.

            Subpart C--Administrative Enforcement Proceedings

18.6  Authority to prohibit appearances.
18.7  Report of violation by a former employee.
18.8  Institution of proceeding.
18.9  Contents of complaint.
18.10  Service of complaint and other papers.
18.11  Answer.
18.12  Motions and requests.
18.13  Representation.
18.14  Hearing examiner.
18.15  Hearings.
18.16  Evidence.
18.17  Depositions.
18.18  Proposed findings and conclusions.
18.19  Decision of the hearing examiner.
18.20  Appeal to the Board of Appellate Review.
18.21  Decision of the Board of Appellate Review.
18.22  Notice of disciplinary action.

    Authority:  18 U.S.C. 207, as amended, 92 Stat. 1864.

    Source:  46 FR 2608, Jan. 12, 1981, unless otherwise noted.

[[Page 93]]



                      Subpart A--General Provisions



Sec. 18.1  Scope.

    This part contains rules governing disciplinary action against a 
former officer or employee of the Department of State, including the 
Foreign Service, because of a violation of the post employment conflict 
of interest prohibitions. Such disciplinary action may include 
prohibition from practice before the Department of State and any 
component thereof as defined in this part.



Sec. 18.2  Definitions.

    For the purpose of this part--
    (a) The term Department means the Department of State and includes 
the Foreign Service.
    (b) The term Director General means the Director General of the 
Foreign Service and Director of Personnel.
    (c) The term practice means any informal or formal appearance 
before, or, with the intent to influence, any oral or written 
communication to the Department on a pending matter of business on 
behalf of any other person (except the United States).



Sec. 18.3  Director General.

    The Director General shall institute and provide for the conduct of 
disciplinary proceedings involving former employees of the Department as 
authorized by 18 U.S.C. 207(j), and perform such other duties as are 
necessary or appropriate to carry out his/her functions under this part.



Sec. 18.4  Records.

    The roster of all persons prohibited from practice before the 
Department shall be available to public inspection at the Office of 
Director General. Other records may be disclosed upon specific request, 
in accordance with appropriate disclosure regulations of the Department.



                       Subpart B--Applicable Rules



Sec. 18.5  Interpretative standards; advisory opinions.

    (a) A determination that a former officer or employee of the 
Department violated 18 U.S.C. 207(a), (b) or (c) will be made in 
conformance with the standards established in the interpretative 
regulations promulgated, either in interim or final form by the Office 
of Government Ethics and published at 5 CFR part 737.
    (b) Former officers and employees of the Department wanting to know 
whether a proposed course of conduct would be in conformity with the Act 
or the interpretive regulations thereunder may contact the Assistant 
Legal Adviser for Management to request an advisory opinion.



            Subpart C--Administrative Enforcement Proceedings



Sec. 18.6  Authority to prohibit appearances.

    Pursuant to 18 U.S.C 207(j), if the Director General finds, after 
notice and opportunity for a hearing, that a former officer or employee 
of the Department has violated 18 U.S.C. 207(a), (b) or (c), the 
Director General in his/her discretion may prohibit that person from 
engaging in practice before the Department for a period not to exceed 
five years, or may take other appropriate disciplinary action.



Sec. 18.7  Report of violation by a former employee.

    (a) If an officer or employee of the Department has reason to 
believe that a former officer or employee of the Department has violated 
any provision of this part, or if any such officer or employee receives 
information to that effect, he/she shall promptly make a written report 
thereof, which report or a copy thereof shall be forwarded to the 
Director General. If any other person has information of such 
violations, he/she may make a report thereof to the Director General or 
to any officer or employee of the Department.
    (b) The Director General shall coordinate proceedings under this 
part with the Department of Justice in cases where it initiates criminal 
prosecution.



Sec. 18.8  Institution of proceeding.

    Whenever the Director General determines that there is sufficient 
reason to believe that any former officer or employee of the Department 
has violated 18 U.S.C. 207(a), (b) or (c), he/she may

[[Page 94]]

institute an administrative disciplinary proceeding. The proceeding may 
be for that person's suspension from practice before the Department or 
for some lesser penalty. The proceeding shall be instituted by a 
complaint which names the respondent and is signed by the Director 
General and filed in his/her office. Except in cases of willfulness, or 
where time, the nature of the proceeding, or the public interest does 
not permit, a proceeding will not be instituted under this section until 
facts or conduct which may warrant such action have been called to the 
attention of the proposed respondent in writing and he/she has been 
accorded the opportunity to provide his/her position on the matter.



Sec. 18.9  Contents of complaint.

    A complaint shall plainly and concisely describe the allegations 
which constitute the basis for the proceeding. A complaint shall be 
deemed sufficient if it fairly informs the respondent of the charges 
against him/her so that the respondent is able to prepare a defense. 
Written notification shall be given of the place and of the time within 
which the respondent shall file his/her answer, which time shall not be 
less than 15 days from the date of service of the complaint. Notice 
shall be given that a decision by default may be rendered against the 
respondent in the event he/she fails to file an answer.



Sec. 18.10  Service of complaint and other papers.

    (a) Complaint. The complaint or a copy thereof may be served upon 
the respondent by certified mail; by delivering it to the respondent or 
his/her attorney or agent of record either in person; or by leaving it 
at the office or place of business of the respondent, attorney or agent; 
in any other manner which has been agreed to by the respondent; or by 
first-class mail in case of a person resident abroad.
    (b) Service of papers other than complaint. Any paper other than the 
complaint may be served upon a respondent as provided in paragraph (a) 
of this section or by mailing the paper by first-class mail to the 
respondent at the last address known to the Director General, or by 
mailing the paper by first-class mail to the respondent's attorney or 
agent of record. Such mailing shall constitute complete service.
    (c) Whenever the filing of a paper is required or permitted in 
connection with a proceeding, and the place of filing is not specified 
by this subpart or by rule or order of the hearing examiner, the paper 
shall be filed with the Director General, Department of State, 
Washington, DC 20520. All papers shall be filed in duplicate.



Sec. 18.11  Answer.

    (a) Filing. The respondent's answer shall be filed in writing within 
the time specified in the complaint or notice of institution of the 
proceeding, unless on application the time is extended by the Director 
General. The answer shall be filed in duplicate with the Director 
General.
    (b) Contents. The answer shall contain a statement of facts which 
constitute the grounds of defense, and it shall specifically admit or 
deny each allegation set forth in the complaint. The respondent may also 
state affirmatively special matters of defense.
    (c) Failure to deny or answer allegations in the complaint. Every 
allegation in the complaint which is not denied in the answer shall be 
deemed to be admitted and may be considered as proved. Failure to file 
an answer within the time prescribed in the notice to the respondent, 
except as the time for answer is extended by the Director General shall 
constitute a waiver of hearing, and the Director General may make his/
her decision by default without a hearing or further procedure.



Sec. 18.12  Motions and requests.

    Motions and requests, including requests to intervene, may be filed 
with the Director General.



Sec. 18.13  Representation.

    A respondent or proposed respondent may appear in person or he/she 
may be represented by counsel or other representative. The Director 
General may be represented by an attorney or other employee of the 
Department.



Sec. 18.14  Hearing examiner.

    (a) After an answer is filed, if the Director General decides to 
continue the

[[Page 95]]

administrative disciplinary proceedings, he/she shall appoint a hearing 
examiner to conduct those proceedings under this part.
    (b) Authorities. Among other powers, the hearing examiner shall have 
authority, in connection with any proceeding assigned or referred to 
him/her, to do the following:
    (1) Take evidence under appropriate formalities;
    (2) Make rulings upon motions and requests;
    (3) Determine the time and place of hearing and regulate its course 
and conduct;
    (4) Adopt rules of procedure and modify the same from time to time 
as occasion requires for the orderly disposition of proceedings;
    (5) Rule upon offers of proof, receive relevant evidence, and 
examine witnesses;
    (6) Take or authorize the taking of depositions;
    (7) Receive and consider oral or written argument on facts or law;
    (8) Hold or provide for the holding of conferences for the 
settlement or simplification of the issues by consent of the parties;
    (9) Perform such acts and take such measures as are necessary or 
appropriate to the efficient conduct of any proceeding; and
    (10) Make initial decisions.



Sec. 18.15  Hearings.

    Hearings shall be stenographically recorded and transcribed and the 
testimony of witnesses shall be taken under oath or affirmation. 
Hearings will be closed unless an open hearing is requested by the 
respondent, except that if classified information or protected 
information of third parties is likely to be adduced at the hearing, it 
will remain closed. If either party to the proceeding fails to appear at 
the hearing, after due notice thereof has been sent to him/her, he/she 
shall be deemed to have waived the right to a hearing and the hearing 
examiner may make a decision against the absent party by default.



Sec. 18.16  Evidence.

    The rules of evidence prevailing in courts of law and equity are not 
controlling in hearings under this part. However, the hearing examiner 
shall exclude evidence which is irrelevant, immaterial, or unduly 
repetitious.



Sec. 18.17  Depositions.

    Depositions for use at a hearing may, with the consent of the 
parties in writing or the written approval of the hearing examiner, be 
taken by either the Director General or the respondent or their duly 
authorized representatives. Depositions may be taken upon oral or 
written interrogatories. There shall be at least 10 days written notice 
to the other party. The requirement of a 10-day written notice may be 
waived by the parties in writing. When a deposition is taken upon 
written interrogatories, any cross-examination shall be upon written 
interrogatories. Copies of such written interrogatories shall be served 
upon the other party with the notice, and copies of any written cross-
interrogation shall be mailed or delivered to the opposing party at 
least 5 days before the date of taking the depositions, unless the 
parties mutually agree otherwise. Expenses in the reporting of 
depositions shall be borne by the party at whose instance the deposition 
is taken.



Sec. 18.18  Proposed findings and conclusions.

    Except in cases where the respondent has failed to answer the 
complaint or where a party has failed to appear at the hearing, the 
hearing examiner, prior to making his/her decision, shall afford the 
parties a reasonable opportunity to submit proposed findings and 
conclusions and supporting reasons therefor.



Sec. 18.19  Decision of the hearing examiner.

    As soon as practicable after the conclusion of a hearing and the 
receipt of any proposed findings and conclusions timely submitted by the 
parties, the hearing examiner shall make the initial decision. The 
decision shall include
    (a) A statement of findings and conclusions, as well as the reasons 
or basis therefor, upon all the material issues of fact, law, or 
discretion presented on the record, and

[[Page 96]]

    (b) An order of suspension from practice before the Department or 
other appropriate disciplinary action, or an order of dismissal of the 
complaint. The hearing examiner shall file the decision with the 
Director General and shall transmit a copy thereof to the respondent or 
his/her attorney of record. A party adversely affected by the decision 
shall be given notice of his or her right to appeal to the Board of 
Appellate Review (part 7 of this chapter) within 30 days from the date 
of the hearing examiner's decision.



Sec. 18.20  Appeal to the Board of Appellate Review.

    Within 30 days from the date of the hearing examiner's decision, 
either party may appeal to the Board of Appellate Review. The appeal 
shall be taken by filing notice of appeal, in triplicate, with the Board 
of Appellate Review, which shall state with particularity exceptions to 
the decision of the hearing examiner and reasons for such exceptions. If 
an appeal is by the Director General, he/she shall transmit a copy 
thereof to the respondent. Within 30 days after receipt of an appeal or 
copy thereof, the other party may file a reply brief, in triplicate, 
with the Board of Appellate Review. If the reply brief is filed by the 
Director General, he/she shall transmit a copy of it to the respondent. 
The Director General shall transmit the entire case record to the Board 
of Appellate Review within 30 days after an appeal has been taken.



Sec. 18.21  Decision of the Board of Appellate Review.

    The Board of Appellate Review shall decide the appeal on the basis 
of the record. The decision of the Board shall be final, and not subject 
to further administrative review. Copies of the Board's decision shall 
be forwarded promptly to the parties by the Board.



Sec. 18.22  Notice of disciplinary action.

    Upon the issuance of a final order suspending a former officer or 
employee from practice before the Department, the Director General shall 
give notice thereof to appropriate officers and employees of the 
Department. Officers and employees of the Department shall refuse to 
participate in any appearance by such former officer or employee or to 
accept any communication which constitutes the prohibited practice 
before the Department during the period of suspension. The Director 
General shall take other appropriate disciplinary action as may be 
required by the final order.



PART 19--BENEFITS FOR SPOUSES AND FORMER SPOUSES OF PARTICIPANTS IN THE FOREIGN SERVICE RETIREMENT AND DISABILITY SYSTEM--Table of Contents




Sec.
19.1  Authorities.
19.2  Definitions.
19.3  Participants.
19.4  Special rules for computing creditable service for purposes of 
          payments to former spouses.
19.5  Required notifications to department respecting spouses and former 
          spouses.
19.5-1  Notification from participant or annuitant.
19.5-2  Notification to Department from former spouses.
19.5-3  Residence of spouse during service at unhealthful post.
19.6  Court orders and divorce decrees.
19.6-1  Orders by a court.
19.6-2  Qualifying court order.
19.6-3  Application for payment.
19.6-4  Date of court orders.
19.6-5  Preliminary review.
19.6-6  Notification.
19.6-7  Decision.
19.6-8  Allotment to beneficiary.
19.6-9  Limitations.
19.6-10  Liability.
19.7  Spousal agreements.
19.7-1  Purpose.
19.7-2  Agreement with spouse.
19.7-3  Agreement with former spouse.
19.7-4  Form of agreement.
19.7-5  Limitations.
19.7-6  Duration and precedence of spousal agreements.
19.8  Obligations of members.
19.9  Pension benefits for former spouses.
19.9-1  Entitlement.
19.9-2  Commencement and termination.
19.9-3  Computation and payment of pension to former spouse.
19.9-4  Effect on annuitant.
19.10  Types of annuities to members.
19.10-1  Full annuity.
19.10-2  Reduced annuity with regular survivor annuity to spouse or 
          former spouse.
19.10-3  Marriage after retirement.
19.10-4  Death or divorce of a spouse and remarriage after retirement.
19.10-5  Reduced annuity with additional

[[Page 97]]

          survivor annuity to spouse of former spouse.
19.10-6  Benefits for recall service.
19.11  Survivor benefits.
19.11-1  Kinds of survivor benefits.
19.11-2  Regular survivor annuity for a former spouse.
19.11-3  Regular survivor annuity for a spouse.
19.11-4  Procedure in event a spouse or former spouse is missing.
19.11-5  Commencement, termination and adjustment of annuities.
19.11-6  Death during active duty.
19.11-7  Annuity payable to surviving child or children.
19.11-8  Required elections between survivor benefits.
19.12  Employment in a Government agency.
19.13  Lump-sum payment.
19.13-1  Lump-sum credit.
19.13-2  Share payable to a former spouse.
19.13-3  Payment after death of principal.
19.14  Waiver of annuity.

    Authority: Secs. 206 and 801 of Foreign Service Act of 1980 (94 
Stat. 2079, 2102); Sec. 4 of Act of May 26, 1949 (22 U.S.C. 2658).

    Source: 46 FR 12958, Feb. 19, 1981, unless otherwise noted. 
Redesignated at 46 FR 18970, Mar. 27, 1981.



Sec. 19.1  Authorities.

    Chapter 8 of the Foreign Service Act of 1980 (Pub. L. 96-465, 94 
Stat. 2102) (hereafter ``the Act''), and any Executive order issued 
under authority of section 827 of the Act.



Sec. 19.2  Definitions.

    (a) Agencies means the Department, the Agency for International 
Development (AID), the International Communication Agency (USICA), the 
Foreign Agricultural Service (FAS), and the Foreign Commercial Service 
(FCS).
    (b) Annuitant means any person including a former participant or 
survivor who meets all requirements for an annuity from the Fund under 
the provisions of the Foreign Service Act of 1980, or any other law and 
who has filed claim therefor.
    (c) Basic salary means the salary fixed by law or administrative 
action before deductions and exclusive of additional compensation of any 
kind. It includes the salary fixed by sections 401, 402, 403, and 406 of 
the Act and salary incident to assignment under section 503 of the Act. 
Basic salary excludes premium pay for overtime, night, Sunday and 
holiday work, allowances, post and special differentials, and charge 
pay.
    (d) Chief of Mission means a principal officer in charge of a 
diplomatic mission of the United States or of a United States Office 
abroad which has been designated diplomatic in nature or any member of 
the Foreign Service assigned under the terms of the Act to be charge 
d'affaires or head of such a mission or office.
    (e) Child means, except with reference to lump-sum payments, an 
unmarried child, under the age of 18 years, or such unmarried child 
regardless of age who because of physical or mental disability incurred 
before age 18 is incapable of self-support. In addition to the offspring 
of the participant, the term includes:
    (1) An adopted child;
    (2) A stepchild or recognized natural child who received more than 
one-half support from the participant; and
    (3) A child who lived with and for whom a petition of adoption was 
filed by a participant, and who is adopted by the surviving spouse of 
the participant after the latter's death. ``Child'' also means an 
unmarried student under the age of 22 years. For this purpose, a child 
whose twenty-second birthday occurs before July 1 or after August 31 of 
a calendar year, and while a student, is deemed to have become 22 years 
of age on the first day of July after the birthday.
    (f) Court means any court of any State or of the District of 
Columbia.
    (g) Court Order means any court decree of divorce or annulment, or 
any court approved property settlement agreement incident to any court 
decree of divorce or annulment.
    (h) Department means the Department of State.
    (i) Divorce means the dissolution of a marriage by a final decree of 
divorce or annulment.
    (j) Expressly provided for means a direction by a court order to 
divide a member's Foreign Service Retirement benefits or survivor 
benefits and awarding a portion of such benefits to an eligible 
beneficiary.

[[Page 98]]

    (k) Former spouse1 means a former wife or husband of a 
participant or former participant who was married to such participant 
for not less than ten years during periods of service by that 
participant which are creditable under section 816 of the Act provided 
the participant was making contributions to the Fund under section 805 
of the Act during some portion of such service, and provided the divorce 
occurred after February 15, 1981. For this purpose, a former spouse 
shall not be considered as married to a participant for periods assumed 
to be creditable under section 808 of the Act in the case of a 
disability annuity or section 809 of the Act in the case of a death in 
service. A former spouse will be considered married to a participant for 
any extra period of creditable service provided under section 817 of the 
Act for service at an unhealthful post during which the former spouse 
resided with the participant. See Sec. 19.5-3 for procedures to 
determine this extra period of marriage.
---------------------------------------------------------------------------


    1 Note: Section 804(6) of the Act defines ``former 
spouse'' with respect to duration of marriage as being married to a 
participant ``for not less than 10 years during periods of service by 
that participant which are creditable under section 816.'' The 
Department interprets this as necessarily implying that the marriage 
must have covered a period of at least one day while the member of the 
Foreign Service was a participant in the System.
---------------------------------------------------------------------------

    (l) Fund means the Foreign Service Retirement and Disability Fund.
    (m) M/MED means the Department's Office of Medical Services.
    (n) Military and naval service means honorable active service:
    (1) In the Armed Forces of the United States;
    (2) In the Regular or Reserve Corps of the Public Health Service 
after June 30, 1960; or
    (3) As commissioned officer of the National Oceanic and Atmospheric 
Administration or predecessor organization after June 30, 1961.

However, this definition does not include service in the National Guard, 
except when ordered to active duty in the service of the United States.
    (o) Participant means a person as described in Sec. 19.3.
    (p) Previous spouse means any person formerly married to a 
principal, whether or not such person qualifies as a former spouse under 
paragraph (k) of this section.
    (q) Principal means a participant or former participant whose 
service forms the basis for a benefit under chapter 8 of the Act for a 
spouse, previous spouse, former spouse or child of a participant.
    (r) PER/ER/RET means the Department's Retirement Division in the 
Bureau of Personnel.
    (s) Pro Rata Share means, in the case of any former spouse of any 
participant or former participant, a percentage which is equal to the 
percentage that (1) the number of years and months during which the 
former spouse was married to the participant during the creditable 
service of that participant is of (2) the total number of years and 
months of such creditable service. When making this calculation, item 
(1) is adjusted in accordance with paragraph (k) of this section and 
item (2) is adjusted in accordance with Sec. 19.4. In the total period, 
30 days constitutes a month and any period of less than 30 days is not 
counted.
    (t) Spousal Agreement means any written agreement between a 
participant or former participant, and the participant's spouse or 
former spouse.
    (u) Student means a child regularly pursuing a full-time course of 
study or training in residence in a high school, trade school, technical 
or vocational institute, junior college, university, or comparable 
recognized educational institution. A child who is a student shall not 
be deemed to have ceased to be a student during any interim between 
school years, semesters, or terms if the interim or other period of 
nonattendance does not exceed 5 calendar months and if the child shows 
to the satisfaction of the Retirement Division (PER/ER/RET) that the 
child has a bona fide intention of continuing to pursue such course 
during the school year, semester, or term immediately following the 
interim.
    (v) Surviving Spouse means the surviving wife or husband of a 
participant or annuitant who, in the case of death in service or 
marriage after retirement,

[[Page 99]]

was married to the participant or annuitant for at least one year 
immediately preceding death or is the parent of a child born of the 
marriage.
    (w) System means the Foreign Service Retirement and Disability 
System.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.3  Participants.

    The following persons are participants in the System:
    (a) Members of the Service serving under a career appointment or as 
a career candidate under section 306 of the Act (1) in the Senior 
Foreign Service, or (2) assigned to a salary class in the Foreign 
Service Schedule;
    (b) Any person not otherwise entitled to be a participant who has 
served as chief of mission or an ambassador at large for an aggregate 
period of 20 years or more, exclusive of extra service credit for 
service at unhealthful posts, and who has paid into the Fund a special 
contribution for each year of service;
    (c) Any individual who was appointed as a Binational Center Grantee 
and who completed, prior to February 15, 1981, at least 5 years of 
satisfactory service as a grantee, as determined by the Director of 
Personnel of USICA, or under any other appointment under the Foreign 
Service Act of 1946, as amended, who has paid into the Fund a special 
contribution for such service.
    (d) Any person converted to the competitive service pursuant to 
section 2104 of the Act who elects to participate in the System pursuant 
to section 2106(b)(1) or (2) shall remain a participant so long as he/
she is employed in an agency which is authorized to utilize the Foreign 
Service personnel system.



Sec. 19.4  Special rules for computing creditable service for purposes of payments to former spouses.

    For purposes of determining the pro rata share of annuity, survivor 
annuity or lump-sum payable to a former spouse, the following shall be 
considered creditable service--
    (a) The entire period of a principal's approved leave without pay 
during full-time service with an organization composed primarily of 
Government employees irrespective of whether the principal elects to 
make payments to the Fund for this service;
    (b) The entire period of Government service for which a principal 
received a refund of retirement contributions which he/she has not 
repaid unless the former spouse received under Sec. 19.13 a portion of 
the (lump-sum) refund or unless a spousal agreement or court order 
provided that no portion of the refund be paid to the former spouse; and
    (c) All creditable service including service in excess of 35 years.

The period covered by the credit for unused sick leave is not creditable 
for this purpose.



Sec. 19.5  Required notifications to Department respecting spouses and former spouses.



Sec. 19.5-1  Notification from participant or annuitant.

    If a participant or former participant becomes divorced on or after 
February 15, 1981, he/she shall notify the Department (PER/ER/RET) of 
the divorce on or prior to its effective date. The notice shall include 
the effective date of the divorce, the full name, mailing address, and 
date of birth of the former spouse and the date of the member's marriage 
to that person, and enclose a certified copy of the divorce decree. If 
there is a court order or spousal agreement concerning payment or 
nonpayment of Foreign Service benefits to the former spouse, the 
original or a certified copy of the order or agreement shall also be 
forwarded to PER/ER/RET. In the absence of a court order or spousal 
agreement providing otherwise, the Department will pay a pro rata share 
of the member's benefits to the former spouse. (A former spouse of a 
former participant who separated from the Service on or before February 
15, 1981 is not eligible for a pension under Sec. 19.9, i.e. not 
eligible for a pro rata share of the principal's annuity.) Upon receipt 
of notice of a divorce, a court order, or spousal agreement, the 
Department will proceed as indicated in Sec. 19.6 or Sec. 19.7. 
Delinquent notice to the Department of the divorce of an annuitant will 
result in retroactive payments to any qualified former spouse

[[Page 100]]

to the extent that the retroactive payments can be deducted from future 
annuity payments to the principal as stated in Sec. 19.6-4.



Sec. 19.5-2  Notification to Department from former spouses.

    A former spouse is obligated to notify the Department of the 
following on a timely basis:
    (a) A divorce from a participant or former participant when the 
former spouse is notified by the court of the divorce before the 
participant is notified;
    (b) Any change in address; and
    (c) Any remarriage.

Notices shall be sent to the Department of State, Attention PER/ER/RET, 
Washington, DC 20520.



Sec. 19.5-3  Residence of spouse during service at unhealthful post.

    (a) The calculation of the pro rata share of benefits for a former 
spouse, and the determination of whether a person qualifies as a 
``former spouse'' depends on the length of the marriage. The latter, 
under the definition in the Act and when the principal has received 
extra service credit for an assignment to an unhealthful post, depends 
upon whether a spouse has resided with the principal at the unhealthful 
post. In order to determine residency for this purpose, whenever a 
married participant is assigned to an unhealthful post for which he/she 
does not receive post differential and does receive or request extra 
service credit, the participant shall report on Form OF-140, Election to 
Receive Extra Service Credit Towards Retirement, whether his/her spouse 
is or is not residing at the post. Although a chief of mission is not 
required to submit Form OF-140 in order to receive extra credit for 
service at an unhealthful post, he/she must nevertheless submit this 
form if the chief of mission has a spouse that does not accompany him/
her at post for the entire assignment. Both the participant and spouse 
shall sign the completed form. If there is a change in residence of the 
spouse during the assignment, a new joint Form OF-140 shall be filed to 
report the change.
    (b) Whenever a participant retires or becomes divorced, or whenever 
a former participant becomes divorced who has extra service credit for 
assignment at unhealthful posts completed prior to the issuance of this 
regulation who was married during at least a portion of the assignment, 
the participant or former participant shall submit a statement to PER/
ER/RET reporting on whether his/her spouse resided at the unhealthful 
post and the dates of such residence. The statement shall be signed by 
the principal and his/her spouse or former spouse whenever possible.
    (c) In the event of a disagreement between a principal and his/her 
spouse or former spouse concerning residency at an unhealthful post, or 
the submission of a report or statement by a principal showing a period 
of nonresidence at a post by a spouse which is not signed by the spouse, 
the determination of residence will be made by PER/ER/RET and based on 
records in the Department of payments for travel and allowances plus any 
other evidence that can be adduced. In the absence of any evidence to 
the contrary, the assumption will be made that the spouse resided at the 
post.



Sec. 19.6  Court orders and divorce decrees.



Sec. 19.6-1  Orders by a court.

    (a) A court may--
    (1) Fix the amount of any pension to a former spouse under 
Sec. 19.9, or order that none be paid;
    (2) Fix the amount of any regular survivor annuity to a former 
spouse under paragraphs (a) and (b) of Sec. 19.11, or order that none be 
paid;
    (3) Order provision of an additional survivor annuity for a spouse 
or former spouse under Sec. 19.10-5;
    (4) Fix the amount of any benefit under Sec. 19.10-6 based on recall 
service payable to a former spouse to whom the annuitant was married 
during any portion of the recall service, or order that none be paid;
    (5) Fix the amount of any lump-sum payable to a former spouse under 
Sec. 19.13 or order that none be paid;
    (6) Order, to the extent consistent with any obligation stated in 
Sec. 19.8 between a participant and a former

[[Page 101]]

spouse, and pursuant to any court decree of divorce, legal separation or 
annulment or any court ordered or approved property settlement agreement 
incident to any court decree of divorce, legal separation, or annulment, 
that any payment from the Fund which would otherwise be made to a former 
participant based on his/her service shall be paid (in whole or in part) 
by the Secretary of State to a previous spouse or child of such 
participant. No apportionment under this paragraph may be made of a 
payment authorized to be paid to a survivor of a participant or 
annuitant.
    (b) An order by a court that does not meet the definition of 
``court'' in Sec. 19.2(f) is not valid for purposes of this section even 
though a divorce decree issued by such court may be a basis for pro rata 
share payments to a former spouse as described in these regulations.



Sec. 19.6-2  Qualifying court order.

    (a) To be valid for purposes of this section, a court order must be 
found to be ``qualified'' by PER/ER/RET acting for the Secretary of 
State. A qualifying court order must--
    (1) Be consistent with the terms of the Act and applicable 
regulations;
    (2) Not direct payment of an amount in excess of the maximum amount 
authorized to be paid by the relevant regulation;
    (3) Direct that payments be made to an eligible beneficiary from a 
principal's Foreign Service retirement benefit or survivor benefit. If a 
court directs or implies that a principal, rather than the Secretary of 
State or the Government, make the payments, the order will not be 
considered qualified unless the principal does not object during the 30-
day notice period provided under Sec. 19.6-6;
    (4) Define the amount to be paid to a beneficiary in way so that it 
can be readily calculated from information in the normal files of the 
Department;
    (5) Not make payment contingent upon events other than those on 
which other payments from the Fund are based such as age, marital status 
and school attendance; and
    (6) Not be in conflict with any previously issued court order which 
remains valid.
    (b) No apportionment of annuity to a beneficiary under Sec. 19.6-
1(a) (1) or (6) shall exceed the net annuity of the principal. The net 
annuity is computed by excluding from the gross annuity the amounts 
which are:
    (1) Owed by the individual to the United States;
    (2) Deducted for health benefits premiums pursuant to section 8906 
of Title 5, United States Code;
    (3) Deducted for life insurance premiums under the Government Life 
Insurance Program;
    (4) Owed due to overpayment of annuity;
    (5) Properly withheld for Federal income tax purposes, if amounts 
withheld are not greater than they would be if the individual claimed 
all dependents to which he/she was entitled.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.6-3  Application for payment.

    (a) To receive payment from the Fund pursuant to a court award, the 
beneficiary must submit an application in writing to the Chief of the 
Retirement Division (PER/ER/RET), Department of State, Washington, DC 
20520. The application must be typed or printed, signed by the 
beneficiary, and include--
    (1) The full name, date of birth, current address and current 
marital status of the beneficiary;
    (2) Full name and date of birth of the participant or former 
participant and his/her date of birth or other identifying information;
    (3) Relationship to the beneficiary, and if a spouse or former 
spouse, date of marriage to and/or divorce from the participant;
    (4) A statement that the court order has not been amended, 
superseded, or set aside;

The original of the court order or a recently certified copy must be 
enclosed with the application, or a statement appended that such a copy 
has been sent to the Department by other means.

[[Page 102]]

    (b) When payments are subject to termination upon the occurrence of 
a condition subsequent, such as marriage, remarriage or termination of 
schooling, or death of the principal, no payment will be made until the 
beneficiary submits a statement to PER/ER/RET that--
    (1) The condition has not occured;
    (2) He/she will notify the Department (PER/ER/RET) within 15 
calendar days of the occurrence of the condition subsequent; and
    (3) He/she will be personally liable for any overpayment to him/her 
resulting from the occurrence of the condition subsequent. PER/ER/RET 
may require periodic recertification of these statements.



Sec. 19.6-4  Date of court orders.

    (a) A court order directing or barring payment of a pension to a 
former spouse under Sec. 19.9 may not be given effect by the Department 
if it is issued more than 12 months after the divorce becomes final. A 
court order adjusting the amount of a regular or additional survivor 
annuity to a former spouse under Sec. 19.11-2 or Sec. 19.10-5 may not be 
given effect by the Department if it is issued after the death of the 
principal.
    (b) A court order issued within 12 months after a divorce becomes 
final directing payment of a pension to a former spouse in an amount 
other than provided in Sec. 19.9 may be made retroactively effective to 
the first of the month in which the divorce becomes final if so 
specified by the court. In such event, the Department will adjust any 
future payments that may become due to an annuitant and a former spouse 
by increasing one and correspondingly reducing the other in order to 
give effect to the order of the court. However, if future payments to 
one party are not due, as for example if a court orders that no payments 
be made to a former spouse, or that 100 percent of an annuity be paid as 
pension to a former spouse, the Department will not give retroactive 
effect to a court order by collecting overpayments from one party in 
order to pay them to the other party and will not make overpayments from 
the Fund.
    (c) A court order under this chapter involving any payment other 
than a pension to a former spouse under Sec. 19.9 may not be given 
retroactive effect and shall not be effective until it is determined to 
be a qualifying order under Sec. 19.6-5.



Sec. 19.6-5  Preliminary review.

    (a) Upon receipt of an application for payment under Sec. 19.6-3, 
PER/ER/RET will determine whether--
    (1) The application is complete;
    (2) The applicant is an eligible beneficiary under this chapter; and
    (3) The court order is a qualifying order. If the application is 
completed, the beneficiary is eligible and the court order appears on 
its face to be a qualifying order, PER/ER/RET will provide the 
notification required by Sec. 19.6-6, otherwise, it will notify the 
applicant of any deficiency or requirement for additional information, 
and if the order is determined to be non-qualifying, the basis for such 
determination.
    (b) Upon receipt of a certified copy of a final decree of divorce, 
PER/ER/RET will determine whether--
    (1) It is a valid decree. Any decree recognized as valid by the 
parties will be considered valid for this purpose. In addition, any non-
recognized decree will be considered valid for this purpose unless:
    (i)(A) Neither party was domiciled within the court's jurisdiction, 
and
    (B) The party denying recognition did not participate in the 
proceedings, or
    (ii) The party denying recognition was not afforded notice of the 
proceedings (actual or constructive);
    (2) A related court order has been submitted by either party; and
    (3) A pro rata share payment is or may become due the former spouse. 
If a divorce decree is deemed valid under this paragraph, a pro rata 
share payment is due a former spouse unless PER/ER/RET is in receipt of 
a court order which it has deemed qualified under paragraph (a) of this 
section, or a valid spousal agrement providing otherwise. If it 
determines that a pro rata share payment is due, it will provide the 
notification required by Sec. 19.6-6, otherwise, unless action is being 
taken pursuant to a related court order, it will notify both parties to 
the

[[Page 103]]

divorce the reason a pro rata share payment is not payable.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.6-6  Notification.

    (a) Notification to a principal. Whenever PER/ER/RET receives from a 
former spouse or other eligible beneficiary--
    (1) a court order which it deems qualified that requires payment to 
the beneficiary; or
    (2) A final decree of divorce which it deems valid together with a 
request for a pro rata share payment--PER/ER/RET will send a copy of the 
document to the principal and a notice stating: (i) That PER/ER/RET 
deems the order qualified or the divorce decree valid, (ii) that 
payments will be made from the principal's account to the beneficiary 
and the effective date of such payments, (iii) the effect of such 
payments on the principal's retirement benefit. In the case of any court 
order with retroactive or immediate effect, and in the case of pro rata 
share payments, the amounts will be withheld from future payments to the 
principal but will not be paid to the beneficiary for 30 days from the 
notice date in order to give the principal an opportunity to contest the 
court order or the validity of the divorce.

PER/ER/RET will provide the former spouse or other beneficiary the same 
information, stating the exact amount that will be payable to the 
beneficiary and explaining how that amount was calculated.
    (b) Notification to a former spouse. When PER/ER/RET receives from a 
principal--(1) a court order which it deems qualified that requires or 
forbids payment to a former spouse; or (2) a final decree of divorce 
which it deems valid without an accompanying court order--PER/ER/RET 
will send a copy of the document to the former spouse and a notice 
stating: (i) That PER/ER/RET deems the court order qualified or the 
divorce decree valid, (ii) that PER/ER/RET intends to honor the court 
decree or to make pro rata share payments because of the divorce, (iii) 
the effective date, exact amount, and method of calculation of any 
payments to the former spouse.

PER/ER/RET will provide the same information to the principal and will 
explain the effect any payment to a former spouse will have on the 
principal's retirement benefit.



Sec. 19.6-7  Decision.

    (a) When a response has not been received by PER/ER/RET from a 
principal within the 30-day period under Sec. 19.6-6a, payment will be 
made in accordance with the notification. When a response is received, 
the Chief, PER/ER/RET will consider the response. If it is shown that a 
court order is not qualifying or that a divorce is not valid under terms 
of the Act and these regulations, payment proposed in the notification 
will not be made. In such a case, PER/ER/RET will advise both parties of 
the basis for its decision and the alternative action, if any, that it 
proposes to take.
    (b) If a principal responding to a notification under Sec. 19.6-6a 
objects to the payment or other action proposed by the Department in the 
notification based on the validity of the court order or divorce decree, 
and the record contains support for the objection, PER/ER/RET will grant 
the principal 30 days to initiate formal legal action to determine the 
validity of the objection, will continue to delay payment to the former 
spouse or other beneficiary during this period, and will notify the 
beneficiary of this action. If evidence is submitted that formal legal 
action has been started within the 30-day period, the amount of any 
proposed payment to a former spouse or other beneficiary will continue 
to be withheld from any payments due the principal, but no payment will 
be made to the former spouse or other beneficiary until a judicial 
decision is rendered or agreement reached between the parties.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.6-8  Allotment to beneficiary.

    If a court order is not a qualifying court order because it directs 
or implies that payment to the beneficiary is to be made by the 
principal rather than the Secretary of State, the principal may make an 
allotment to the beneficiary from his/her annuity. An annuitant may also 
make an allotment

[[Page 104]]

from his/her annuity to a previous spouse in the absence of a court 
order.



Sec. 19.6-9  Limitations.

    (a) Retirement benefits are subject to apportionment by court order 
under Sec. 19.6-1(a)(6) only while the principal is living. Payment of 
apportioned amounts will be made only to a previous spouse and/or the 
children of the principal. Such payments will not be made to any of the 
following:
    (1) Heirs or legatees of the previous spouse;
    (2) Creditors of either the principal or the previous spouse; or
    (3) Assignees of either the principal or the previous spouse.
    (b) The amount of any court ordered payment may not be less than one 
dollar and, in the absence of compelling circumstances, shall be in 
whole dollars.
    (c) In honoring and complying with a court order, the Department 
shall not be required to disrupt the scheduled method of accruing 
retirement benefits or the normal timing for making such payments, 
despite the existence of any special schedule relating to a previous 
spouse or other beneficiary.
    (d) In cases where the court order apportions a percentage of the 
retirement benefits, PER/ER/RET will initially determine the amount of 
proper payment. That amount will only be increased by future cost-of-
living increases unless the court directs otherwise.



Sec. 19.6-10  Liability.

    (a) The Department shall not be liable for any payment made from 
retirement benefits pursuant to a court order if such payment is made in 
accordance with the provisions of this chapter.
    (b) In the event that the Secretary is served with more than one 
court order with respect to the same retirement benefits, the benefits 
shall be available to satisfy the court orders on a first-come, first-
served basis.
    (c) A previous spouse or other beneficiary may request that an 
amount be withheld from the retirement benefits of a principal or 
survivor of a principal which is less than the amount stipulated in a 
court order, or otherwise scheduled to be paid to the beneficiary under 
this chapter. This lower amount will be deemed a complete fulfillment of 
the obligation of the Department for the period in which the request is 
in effect. See Sec. 19.14.



Sec. 19.7  Spousal agreements.



Sec. 19.7-1  Purpose.

    A spousal agreement may be used by both parties to establish an 
agreed-upon level of benefits to a spouse or a former spouse and to 
relieve the participant of responsibility for providing a higher level 
of benefits.



Sec. 19.7-2  Agreement with spouse.

    (a) A spousal agreement between a participant and a spouse may waive 
or fix the level of a regular survivor annuity under Sec. 19.11-3. If an 
agreement is filed, it will assure the spouse that the agreed-upon level 
of survivor annuity will be paid, irrespective of a future divorce 
provided the survivor meets the definition of ``former spouse'' in 
Sec. 19.2(k). If an agreement is not filed, the participant's annuity 
will be reduced under Sec. 19.10-2 to provide the maximum regular 
survivor annuity for the spouse, but in the event of a future divorce if 
the spouse meets the definition of ``former spouse,'' that person will 
be entitled only to a pro rata share of the survivor annuity. An 
agreement under this paragraph may be filed with PER/ER/RET at any time 
prior to retirement (commencement of the principal's annuity).
    (b) A spousal agreement between an annuitant and a spouse filed with 
PER/ER/RET before commencement of a supplemental annuity for recall 
service may waive a supplemental survivor annuity that would otherwise 
be provided for a spouse under Sec. 19.10-6.
    (c) A spousal agreement between a participant or former participant 
and a spouse may be filed with PER/ER/RET at any time in accordance with 
Sec. 19.10-5 and provide for an additional survivor annuity for the 
spouse.
    (d) A spousal agreement filed under paragraph (a), (b), or (c) 
remains valid and binding in the event of divorce if the spouse 
qualifies as a former spouse.

[[Page 105]]



Sec. 19.7-3  Agreement with former spouse.

    (a) A spousal agreement between a participant or former participant 
and a former spouse may waive, reduce or increase the following benefits 
for a former spouse;
    (1) A pension under Sec. 19.9;
    (2) A regular survivor annuity under Sec. 19.11-2;
    (3) A supplemental survivor annuity under Sec. 19.10-6;
    (4) A lump sum payment for regular or recall service under 
Sec. 19.13.

A spousal agreement shall also be used by a participant or former 
participant who has a former spouse on February 15, 1981, to elect a 
regular survivor annuity for such former spouse in accordance with 
Sec. 19.11-2(e). An agreement to establish or increase any benefit for a 
former spouse entered into while the principal is married to someone 
else, must be signed and agreed to by both the spouse and the former 
spouse. An agreement affecting pension benefits may be filed at any time 
and will govern payments made after its acceptance by PER/ER/RET. An 
agreement affecting a regular survivor annuity must be filed before the 
end of the 12-month period after the divorce involving that former 
spouse or at the time of retirement, whichever occurs first, except as 
authorized in Sec. 19.11-2(b) for persons retired on February 15, 1981, 
or in Sec. 19.11-2(e) with respect to persons who were former spouses on 
February 15, 1981. This filing requirement stated in the Act makes it 
impossible to adjust, other than by court order, a regular survivor 
annuity for a former spouse when the divorce occurs after a retirement 
which occurs on or after February 15, 1981. The survivor annuity for the 
former spouse in such case is fixed by any spousal agreement entered 
into prior to the divorce, by Sec. 19.11-2 or by court order. An 
agreement affecting supplemental survivor benefits or lump-sum payments 
must be filed before the supplemental annuity of the principal begins or 
lump-sum payment is made.
    (b) A spousal agreement between a participant or former participant 
and a former spouse may be filed with PER/ER/RET at any time in 
accordance with Sec. 19.10-5 to provide an additional survivor annuity 
for the former spouse.



Sec. 19.7-4  Form of agreement.

    (a) A spousal agreement is any legal agreement between the parties 
accepted by PER/ER/RET as meeting the requirements of this section. If 
in accordance with the regulations, PER/ER/RET will accept as a valid 
spousal agreement a property settlement agreed to by the parties and 
approved by a court regardless of the date of the agreement.
    (b) A spousal agreement must either be authenticated by a court or 
notarized.



Sec. 19.7-5  Limitations.

    (a) A spousal agreement may not provide for any payment from the 
Fund in excess of the amount otherwise authorized to be paid, or at a 
time not authorized by these regulations, or to a person other than a 
spouse or former spouse.
    (b) A spousal agreement must be filed with the Department, Attention 
PER/ER/RET, and accepted by that office as in conformance with the Act 
and these regulations prior to the times specified in Secs. 19.7-2 and 
19.7-3. That office will provide advice to the parties on the validity 
of any proposed agreement and on proper format.
    (c) A spousal agreement may apply only to payments from the Fund for 
periods after receipt of a valid agreement by the Department.
    (d) Paragraphs (b), (c) and (d) of Secs. 19.6-9 and 19.6-10 apply to 
spousal agreements and payments made pursuant to spousal agreements to 
the same extent that they apply to court orders and court ordered 
payments.



Sec. 19.7-6  Duration and precedence of spousal agreements.

    (a) A spousal agreement may be revised or voided by agreement of the 
parties (by filing a new agreement under this section) at any time prior 
to the last day for filing an agreement determined in accordance with 
Sec. 19.7-2 or Sec. 19.7-3, except spousal agreements for additional 
survivor annuities are irrevocable. After the last day for filing a 
particular agreement, such agreement is irrevocable.

[[Page 106]]

    (b) A valid spousal agreement entered into subsequent to the 
issuance of a court order affecting the same parties will override the 
court order, and shall govern payments from the Fund.
    (c) A spousal agreement may not override a previous spousal 
agreement involving the same principal but a different spouse or former 
spouse without agreement of such spouse or former spouse.



Sec. 19.8  Obligations of members.

    Participants and former participants are obligated by the Act and 
these regulations to provide the following benefits to others and must 
accept the necessary reductions in their own retirement benefits to meet 
these obligations:
    (a) A pension to a former spouse pursuant to Sec. 19.9;
    (b) A court ordered apportionment of annuity to a previous spouse or 
child under Sec. 19.6-1 (a)(6) (the benefit to a child referred to here 
is paid during the annuitant's lifetime as distinguished from the 
automatic survivorship annuity to a child described in Sec. 19.11-7);
    (c) A regular survivor annuity to a former spouse who has not 
remarried prior to age 60, and to a spouse to whom married when annuity 
commences, pursuant to Secs. 19.11-2 and 19.11-3;
    (d) An additional survivor annuity for a spouse or former spouse 
under Sec. 19.10-5 when elected by the participant or ordered by a 
court;
    (e) Lump-sum payments to a former spouse pursuant to Sec. 19.13;
    (f) Benefits ordered by a court under Sec. 19.6 or specified in a 
spousal agreement under Sec. 19.7.



Sec. 19.9  Pension benefits for former spouses.



Sec. 19.9-1  Entitlement.

    (a) Unless otherwise expressly provided by a spousal agreement under 
Sec. 19.7 or a court order under Sec. 19.6, a person who, after February 
15, 1981, becomes a former spouse of a participant (or former 
participant who separated from the Service after February 15, 1981) and 
who has not remarried prior to becoming 60 years of age, becomes 
entitled to a monthly pension benefit effective on a date determined 
under Sec. 19.9-2 in an amount determined under Sec. 19.9-3.
    (b) A former spouse shall not be qualified for a pension under this 
subsection if, before the commencement of that pension, the former 
spouse remarries before becoming 60 years of age.
    (c) A pension benefit under this section is treated the same as a 
survivor annuity for purposes of Sec. 19.11-5(b): a former spouse who 
elects to receive a pension under this section must waive simultaneous 
receipt of any survivor annuity.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.9-2  Commencement and termination.

    (a) The pension of a former spouse under this subsection commences 
on the latter of the day the principal becomes entitled to a Foreign 
Service annuity or on the first day of the month in which the divorce 
becomes final. (Suspension or reduction of a Foreign Service annuity 
because or reemployment does not affect the commencement of a pension to 
a former spouse.) In the case of any former spouse of a disability 
annuitant, the pension of such former spouse shall commence on the 
latter of:
    (1) The date the principal would qualify for an annuity (other than 
a disability annuity) on the basis of his/her creditable service;
    (2) The date the disability annuity begins; or
    (3) The first of the month in which the divorce becomes final.
    (b) The pension of a former spouse and the right thereto terminate 
on:
    (1) The last day of the month before the former spouse dies or 
remarries before 60 years of age; or
    (2) The date the annuity of the former participant terminates unless 
the termination results from recall, reappointment or reinstatement in 
the Foreign Service or reemployment in Government service.



Sec. 19.9-3  Computation and payment of pension to former spouse.

    (a) A pension to a former spouse is paid monthly on the same date 
that annuity is paid to the principal.

[[Page 107]]

    (b) No spousal agreement or court order may provide for a pension or 
any combination of pensions to former spouses of any one principal which 
exceeds the net annuity of the principal as defined in Sec. 19.6-2(b).
    (c) A pension to a former spouse not fixed by a spousal agreement or 
court order shall equal the former spouse's pro rata share of 50 percent 
of the annuity to which the principal is entitled on the date the 
divorce becomes final, or, if not then entitled to an annuity, 50 
percent of the annuity to which the principal first becomes entitled 
following that date. A pension to a former spouse of a disability 
annuitant shall be calculated on the basis of an annuity for which the 
participant would qualify if not disabled. A pension to a former spouse 
will be increased by the same percentage of each cost-of-living 
adjustment received by the principal.
    (d) The Department will initiate payment of a pension to a former 
spouse after complying with the notification and other procedures 
described in Sec. 19.6.
    (e) If a pension can not be paid because a former spouse is missing, 
the principal may file an affidavit with PER/ER/RET that he/she does not 
know the whereabouts of the former spouse. In such an event, the 
principal and the Department will follow the procedures in Sec. 19.11-4 
in an effort to locate the former spouse. The annuity of the principal 
will be reduced by the amount of the pension to the former spouse even 
though the latter is not being paid. If the former spouse has not been 
located during the 12-month period following the date the principal 
files an affidavit under this section, the annuity of the principal will 
be recomputed effective from its commencing date (or on the date 
following the last month a pension payment was made to the former 
spouse) and paid without reduction of the amount of pension to the 
former spouse. If the former spouse subsequently is located, pension 
payments to him/her will be initiated at that time at the rate that 
would have been payable had they been paid continuously from the 
original effective date. The Department shall not be liable to make any 
pension payments to the former spouse for the missing period if the 
procedures under this section were faithfully complied with nor will the 
Department be responsible for recovering any payments made to the 
principal for the benefit of the former spouse.



Sec. 19.9-4  Effect on annuitant.

    Any pension payable to a former spouse under this section or 
pursuant to any spousal agreement or court order shall be deducted from 
the annuity of the principal. (See Sec. 19.6-4 concerning retroactive 
adjustments.) If the annuity of such a principal in any month is 
discontinued or reduced so that the net amount payable is less than the 
pension to the former spouse or spouses of the principal because of 
recall, reappointment or reinstatment in the Foreign Service or 
reemployment in the Government service, the principal's salary, rather 
than annuity, shall be reduced by the amount of the pension payment(s). 
Such salary reductions shall be deposited in the Treasury to the credit 
of the Fund. If a pension to a former spouse is discontinued for any 
reason except a suspension pending a determination of entitlement, the 
annuity of the principal shall be recomputed effective as of the date of 
discontinuance of the pension, and paid as if the pension to the former 
spouse had never been deducted.



Sec. 19.10  Types of annuities to members.



Sec. 19.10-1  Full annuity.

    If a participant retires and does not provide a survivor annuity to 
a spouse, former spouse or designated beneficiary, the participant 
receives a ``full'' annuity. A full annuity means an annuity computed 
without any survivorship reduction. Example: Average salary $20,000 and 
maximum of 35 years of service.

                                                                        
                                                                        
                                                                        
Average basic annual salary for high 3 consecutive years of             
 service......................................................   $20,000
Multiplied by 2 pct...........................................       .02
                                                               ---------
                                                                 $400.00
Multiplied by 35 years of creditable service..................       .35
                                                               ---------
Full annuity..................................................   $14,000
                                                                        


[[Page 108]]



Sec. 19.10-2  Reduced annuity with regular survivor annuity to spouse or former spouse.

    (a) At commencement of annuity, a participant or former participant 
may provide a regular survivor annuity for any eligible former spouse 
and, within the limits of paragraph (b) of this section, a regular 
survivor annuity to any spouse to whom he/she is then married as 
described in Secs. 19.11-2 and 19.11-3, respectively. A regular survivor 
annuity for a spouse or former spouse equals 55 percent of the portion 
of the retiree's annuity (up to the full amount) designated as the base 
for the survivor annuity. To provide the survivor annuity, the 
participant must accept a reduction in his/her full annuity equal to 
2\1/2\ percent of the first $3,600 of the designated base, plus 10 
percent of the balance of the base. If a regular survivor annuity is 
being provided for both a spouse and a former spouse, the bases for each 
are added and the calculation made as in the following example:

    Participant's full annuity as computed in Sec. 19.10-1: $14,000.
    Maximum regular survivor annuity is 55 percent of full annuity: 
$7,700.
    Case I (Participant has a spouse and former spouse at retirement) If 
the pro rata share for a former spouse is 75 percent, the base for this 
benefit will be 75 percent of $14,000: $10,500.
    The base for the maximum regular survivor annuity for a spouse would 
then be 25 percent of $14,000, or $3,500.
    Combined base: $14,000.
    Participant's full annuity reduced as follows:
    2\1/2\ percent of first $3,600 of the base: $90.
    Plus 10 percent of the amount over $3,600 ($14,000-3,600) $10,400: 
$1,040.
    Total reduction in participant's full annuity: $1,130.
    Participant's reduced annuity: $12,870.
    Survivor annuity for former spouse: 55 percent of $10,500 or $5,775.
    Survivor annuity for spouse: 55 percent of $3,500 or $1,925.
    Case II (Participant married at retirement with no former spouse. 
All calculations made without reference to cost-of-living increases 
described in Sec. 19.11-5d.)
    Joint election of base for regular survivor annuity of 90 percent of 
the maximum, or 90 percent of $14,000: $12,600.
    Participant's full annuity reduced as follows:
    2\1/2\ percent of first $3,600 of the base: $90.
    Plus 10 percent of the amount over $3,600 ($12,600-3,600) $9,000: 
$900.
    Total reduction in participant's full annuity: $990.
    Participant's reduced annuity: $13,010.
    In this example, if divorce occurs subsequent to retirement and a 
court orders a 75 percent share for the former spouse, the base for the 
survivor annuity for the former spouse would be 75 percent of $14,000: 
$10,500.
    The participant's full annuity would then be reduced by $780 in 
accordance with the above formula for this survivor benefit, and the 
reduced annuity would be $14,000-780: $13,220.
    If the former spouse qualifies for a pension as described in 
Sec. 19.9 based on a pro rata share of 75 percent, the pension would 
equal 50 percent of the participant's reduced annuity times 75 percent 
(50%  x  $13,220  x  75%): 4,957.50.
    The participant's reduced annuity would then be further reduced by 
this pension ($13,220-$4,957.50) to provide an annuity to the former 
participant of $8,262.50.
    If this annuitant later remarried, the maximum base for the regular 
survivor annuity for the new spouse would be the amount designated at 
retirement, $12,600, less the amount committed to the former spouse, 
$10,500: $12,600-10,500 or $2,100.
    The survivor annuity for this spouse: 55 percent of $2,100 or 
$1,555.
    The election of this benefit for the new spouse would be made 
individually by the annuitant since a marriage after retirement does not 
give a spouse a right to participate in the election.
    If the election is made to provide a regular survivor annuity to the 
new spouse, all of the above calculations would be recomputed effective 
the first day of the month beginning one year after the date of the 
remarriage, as follows:
    Base for survivor annuity for former spouse: 75% of $14,000 or 
$10,500.
    Survivor annuity for former spouse: 55% of $10,500 or $5,775.
    Base for survivor annuity for spouse: 15% of $14,000 or $2,100.
    Survivor annuity for spouse: 55% of $2,100 or $1,555.
    The combined base for the survivor benefits is $10,500 plus $2,100 
or $12,600. The annuity reduction on this combined base as computed 
above is $990.
    The participant's annuity after reduction for survivor benefit would 
be $14,000-$990 or $13,010.
    The pension for the former spouse would be 50% x $13,010 x 75% or 
$4,878.75.
    The participant's annuity would be further reduced by this amount: 
$13,010-$4,878.75 to provide an annuity after this recalculation of 
$8,131.25.

    (b) The maximum regular survivor annuity or combination of regular 
survivor annuities that may be provided

[[Page 109]]

under this section is limited to 55% of the principal's full annuity 
computed at retirement. If an annuitant is recalled to active duty in 
the Foreign Service, he/she may provide additional regular survivor 
annuities under Sec. 19.10-6. The maximum regular survivor annuity or 
combination of regular survivor annuities that an annuitant who was 
married at retirement may elect or provide, pursuant to a court order or 
otherwise, after retirement in the event of his/her divorce or 
remarriage, is limited to the amount provided at the time of initial 
retirement or reversion to retired status following recall service.



Sec. 19.10-3  Marriage after retirement.

    If an annuitant who was unmarried at the time of retirement, 
marries, he/she may within one year after such marriage irrevocably 
elect to receive a reduced annuity and to provide, subject to any 
obligation to provide a survivor annuity for a former spouse, a survivor 
annuity for the new spouse. If such an election is made, the principal's 
annuity shall be reduced in accordance with Sec. 19.10-2 effective on 
the first day of the first month which begins at least one year after 
the date of the marriage. The reduction is computed on the commencing 
rate of the principal's annuity.



Sec. 19.10-4  Death or divorce of a spouse and remarriage after retirement.

    (a) If the marriage of an annuitant who received a reduced annuity 
at retirement under Sec. 19.10-2 to provide a survivor annuity for a 
spouse is dissolved by divorce or by death of the spouse, the retiree's 
annuity shall be recomputed, if necessary, as of the first of the month 
following the death or divorce. If the marriage was dissolved by death, 
the annuity shall be recomputed and paid at its full amount. If the 
marriage is dissolved by divorce, procedures in Sec. 19.11-2(b) shall be 
followed.
    (b) In the event an annuitant affected by this paragraph remarries, 
the annuitant may elect within one year of remarriage to provide a 
survivor annuity for the new spouse equal in amount to the survivor 
benefit formerly in effect for the previous spouse less any amount 
committed for a former spouse. The annuity of a retiree making such an 
election shall be reduced effective on the first day of the first month 
which begins at least one year after the remarriage to the amount that 
would have been payable had there been no recomputation under paragraph 
(a) of this section.



Sec. 19.10-5  Reduced annuity with additional survivor annuity to spouse or former spouse.

    (a) General. This section provides an opportunity for a participant 
or former participant who has provided a regular survivor annuity to a 
former spouse to provide a survivor annuity to a second spouse or to 
another former spouse. The additional survivor annuity provided under 
this section generally is more costly than the regular survivor annuity 
because the participant is required to pay it's full cost by deduction 
from salary or annuity, or otherwise, as specified in paragraph (e) of 
this section. The participant must also be in normal health for his/her 
age and pass a physical examination prescribed by the Secretary of State 
(M/MED) to be eligible to provide an additional survivor annuity under 
this section.
    (b) Limitation on amount. Neither the total amount of additional 
survivor annuity or annuities under this section provided by any 
participant or former participant nor any combination of regular or 
additional survivor annuities for any one surviving spouse or former 
spouse of a principal may exceed 55 percent of the principal's full 
annuity counting any supplemental annuity or recomputation of annuity 
because of recall service. An additional survivor annuity provided by 
any principal shall be further limited to the amount that can be 
provided by a monthly payment which is not greater than the principal's 
net annuity described in Sec. 19.6-2(b). The amount of any additional 
survivor annuity provided by a spousal agreement effective prior to the 
principal's retirement, shall be reduced as necessary by PER/ER/RET 
after the principal's retirement to comply with this limitation. Any 
amount paid by a participant for the portion of additional survivor 
annuity cancelled pursuant to this paragraph shall be treated as an 
additional

[[Page 110]]

lump sum payment under paragraph (e) of this section and used to 
increase the amount of the additional annuity. A participant who 
separates from the Service without entitlement to any annuity is not 
entitled to provide an additional survivor annuity. Payments in such a 
case would be discontinued as described in paragraph (e) of this 
section.
    (c) Procedures to grant additional survivor annuity. A participant 
or former participant who has provided a regular survivor annuity to a 
former spouse who wishes to provide, or who is ordered by a court to 
provide an additional survivor annuity under this section to a spouse or 
another former spouse, shall do so by filing a spousal agreement with 
PER/ER/RET on a form acceptable to PER/ER/RET. Such an agreement will be 
irrevocable when accepted by PER/ER/RET unless the beneficiary of the 
additional survivor annuity is subsequently made a beneficiary of a 
regular survivor annuity in equal amount. Within the limitations 
specified in paragraph (b) of this section, an individual may be made 
the beneficiary of both a regular and an additional survivor annuity. A 
spousal agreement granting an additional survivor annuity to a spouse 
will remain valid in the event the marriage is dissolved and the spouse 
qualifies as a former spouse under the definition Sec. 19.2(k).
    (d) Eligibility for additional survivor annuity. A spouse or former 
spouse must meet the same criteria (Sec. 19.2(v) or Sec. 19.2(k)) to be 
eligible for an additional survivor annuity as a spouse or former spouse 
must meet to be eligible for a regular survivor annuity. Payment of a 
special survivor annuity will commence on the day after the participant 
dies and shall terminate on the last day of the month before death or 
remarriage before attaining age 60. If it is discontinued because of 
remarriage, it will not be resumed.
    (e) Payment for additional survivor annuity. (1) Payment for an 
additional survivor annuity will commence on the first of the month 
following the effective date of a spousal agreement provising the 
additional survivor annuity. The effective date will be the date of 
acceptance of the spousal agreement by PER/ER-RET (upon a finding that 
the agreement conforms to the law and regulations) or such later date as 
may be specified in the agreement. No payment will be made to a 
beneficiary under the agreement if the principal dies before its 
effective date. Accordingly, in order to give protection to a 
beneficiary during active service, the agreement must be made effective, 
and payment commence, during active service. Payment will be made by a 
participant or annuitant by deduction from salary or annuity. Payment 
will be made by a former participant while awaiting commencement of a 
deferred annuity by direct payment to the Department, Office of 
Financial Operations (M/COMP/FO). Payments not received by the due date 
may, at the option of M/COMP/FO and with notice to the principal and the 
beneficiary be collected from the principal's lump-sum account. Amounts 
so collected must be repaid by the principal with interest compounded at 
10 percent annually to prevent exhaustion of the lump-sum account. If 
the lump-sum account does become exhausted, any rights to the lump-sum 
payment under Sec. 19.13 and survivorship rights under this paragraph 
will expire on that date. If the principal dies with an amount owing, it 
shall be collected by set off from the survivor annuity or lump-sum 
account.
    (2) Monthly payments may be reduced or eliminated by direct payment 
to M/COMP/FO by any participant or former participant under terms 
mutually agreed upon by the participant and PER/ER/RET. Minimum monthly 
payments will be based upon actuarial tables prescribed from time to 
time by the Director General of the Foreign Service (M/DGP) with the 
advice of the Secretary of Treasury. Such tables will be calculated so 
that the present value of all payments equal the present value of the 
survivor annuity. If new tables are prescribed, they would be applicable 
to additional survivor annuities provided by spousal agreements that 
become effective on or after the effective date of the new tables. 
Additional survivor annuities will be increased by regular cost-of-
living adjustments from their commencing dates only when so

[[Page 111]]

specified at the option of the participant or former participant in a 
spousal agreement. Monthly payments will be higher if cost-of-living 
adjustments are provided.
    (3) In the event of the disqualification of a beneficiary for an 
additional survivor annuity because of death, remarriage prior to age 60 
or divorce from the principal and failure to meet the definition of 
``former spouse,'' or in the event of an authorized reduction or 
cancellation of an election for an additional survivor annuity, the 
monthly payment for such discontinued or reduced additional survivor 
annuity will be discontinued or reduced, as appropriate, effective at 
the beginning of the first month following termination or reduction of 
the benefit. Except as otherwise specified in paragraph (b) of this 
section, any amount paid for such discontinued or reduced benefit by a 
participant or former participant in excess of the minimum monthly 
payments described above shall be refunded to the participant or former 
participant with interest calculated at the annual rate used in the last 
evaluation of the System or at such higher rate as may be authorized by 
M/COMP/FO as will not cause a loss to the Fund. The following table 
illustrates the minimum monthly payments schedule in effect February 15, 
1981.

                                                                        
------------------------------------------------------------------------
                                                 Minimum monthly payment
                                                 required to provide an 
                                                   additional survivor  
 Age of principal and beneficiary on effective     annuity of $100 per  
           date of spousal agreement                     month.         
                                               -------------------------
                                                  Without               
                                                    COLA      With COLA 
------------------------------------------------------------------------
40............................................        $7.49       $12.34
50............................................        14.18        22.01
60............................................        23.55        33.90
70............................................        35.57        47.12
------------------------------------------------------------------------

    (4) Reduction from annuity to a principal to pay for an additional 
survivor annuity will be in the nature of an allotment and will not 
affect computations of cost-of-living adjustments to the principal.



Sec. 19.10-6  Benefits for recall service.

    (a) Annuity of recalled participant. Any participant who is recalled 
to the Service under section 308 of the Act, shall, while serving, be 
entitled in lieu of annuity to the full salary of the class in which 
serving. During such service, the recalled annuitant shall make 
contributions to the Fund under section 805(a) of the Act. If a share of 
the annuity is being paid as a pension to a former spouse under 
Sec. 19.9, that share shall be deducted from the salary of the recalled 
annuitant during the period of the recall service. Upon reversion of the 
annuitant to retired status, any pension payable to a former spouse that 
was being deducted from the salary of the principal shall again be 
deducted from the annuity of the principal which shall be determined as 
follows:
    (1) If the recall service lasts less than one year, a refund of 
retirement contributions made during the recall period will be refunded 
under Sec. 19.13 and the former annuity will be resumed at the previous 
rate adjusted by any cost-of-living increases that became effective 
during recall service.
    (2) If the recall service lasts between one and five years, the 
annuitant will be entitled to elect benefits under paragraph (a)(1) of 
this section or receive both the former annuity adjusted by cost-of-
living increases and a supplemental annuity computed under Sec. 19.10 on 
the basis of service credit and average salary earned during the recall 
period, irrespective of the number of years of service credit previously 
earned.
    (3) If the recall service lasts five years or more, the annuitant 
will be entitled to recomputation of the annuity as if there had been no 
previous retirement, or elect benefits under paragraph (a) (1) or (2) of 
this section.
    (4) An annuitant may receive credit in any computation under 
paragraph (a) (2) or (3) of this section for any Federal service 
performed subsequent to the separation upon which the original annuity 
was computed provided a special contribution is made for such service 
under section 805 of the Act.
    (5) An annuitant entitled to a supplemental annuity under paragraph 
(a)(3) of this section or a recomputated annuity under paragraph (a)(4) 
of this section is obligated, in the absence of a court order or spousal 
agreement to the contrary, to have those annuities reduced to provide 
the benefits described in Sec. 19.8 to any spouse or former spouse to 
whom married during any

[[Page 112]]

portion of the recall service. An annuitant must accept a reduction of 
10 percent of his/her supplemental annuity in order to provide a 
supplemental survivor annuity to a spouse or former spouse. The maximum 
supplemental survivor annuity equals 55 percent of the supplemental 
annuity. If, upon reversion to retired status, an annuitant has a former 
spouse entitled to a pro rata share or some other share of the 
supplemental survivor annuity, but no spouse, the appropriate share of 
the supplemental annuity shall be reduced by 10 percent to provide such 
former spouse a share of the maximum supplemental survivor annuity.
    (b) Survivor benefit for death during recall service. (1) If an 
annuitant entitled to a reduced annuity under Sec. 19.10-2 dies in 
service after being recalled and is survived by a spouse or former 
spouse entitled to a survivor annuity based on the service of such 
annuitant, such survivor annuity shall be computed as if the recall 
service had otherwise terminated on the day of death and the annuity of 
the deceased had been resumed in accordance with paragraph (a) of this 
section. If such death occurs after the annuitant had completed 
sufficient recall service to attain eligibility for a supplemental 
annuity, a surviving spouse or surviving former spouse who was married 
to the participant at any time during a period of recall service shall 
be entitled to elect, in addition to any other benefits and in lieu of a 
refund of retirement contributions made during the recall service, a 
supplemental survivor annuity computed and paid under Sec. 19.10-6a(5) 
as if the recall service had otherwise terminated. If the annuitant had 
completed sufficient recall service to attain eligibility to have his/
her annuity determined anew, a surviving spouse or such a surviving 
former spouse may elect, in lieu of any other survivor benefit under 
Sec. 19.11, to have the rights of the annuitant redetermined and to 
receive a survivor annuity computed under Sec. 19.11-2 or Sec. 19.11-3 
on the basis of the total service of the annuitant. In the event such an 
annuitant is survived both by a spouse and such a former spouse, the 
former spouse will be entitled to a pro rata share of any refund or 
supplemental survivor benefit under this section computed on the basis 
of total service during the recall period and months of marriage during 
such period. If the surviving spouse and surviving former spouse elect 
different benefits under this paragraph, the former spouse will receive 
the pro rata share of the benefit he/she elects and the spouse will 
receive the reciprocal share of the benefit he/she elects.
    (2) In the event an annuitant dies during recall service and is 
survived by a former spouse to whom not married during any period of the 
recall service, such former spouse will not be entitled to any benefits 
based on the recall service.



Sec. 19.11  Survivor benefits.



Sec. 19.11-1  Kinds of survivor benefits.

    If a participant or former participant dies in active service or 
after retirement, regular survivor annuities are payable under terms of 
this section to an eligible surviving spouse, former spouse or child. 
Also, if all rights to annuity and survivor annuity terminate prior to 
exhaustion of the participant's lump-sum credit, a lump-sum payment is 
made pursuant to Sec. 19.13. In addition to the above, an additional 
survivor annuity, and a supplemental survivor annuity may be payable to 
an eligible survivor under Secs. 19.10-5 and 19.10-6, respectively. If 
any participant or former participant makes an election, files a spousal 
agreement or becomes subject to a court order to provide a regular 
survivor annuity for a spouse or former spouse and does not subsequently 
become entitled to leave a survivor annuity under these regulations 
(because of separation from the Service and withdrawal of contributions, 
death after separation but before commencement of a deferred annuity, or 
for any other reason), none will be paid and such election, spousal 
agreement or court order to provide such survivor annuity will have no 
force or effect.

[[Page 113]]



Sec. 19.11-2  Regular survivor annuity for a former spouse.

    (a) Divorce prior to retirement. If a participant or former 
participant is divorced prior to commencement of annuity, any former 
spouse shall be entitled to a pro rata share of such a principal's 
maximum regular survivor annuity (based on service performed prior to 
the first date the principal becomes eligible for an annuity following 
the divorce) unless a different amount is elected in a spousal agreement 
filed with PER/ER/RET within 12 months after the divorce becomes final 
or at the time of the retirement, whichever occurs first, or unless a 
different amount is specified by a court prior to the death of the 
principal. The principal's annuity shall be reduced at the commencing 
date under Sec. 19.10-2 in order to provide the survivor annuity 
committed to the former spouse.
    (b) Divorce after retirement. In the event an annuitant is divorced 
after retirement (commencement of annuity), the maximum survivor annuity 
that may be provided for that former spouse is limited to the amount 
provided for that person at the time of retirement. Within that limit, 
the former spouse is entitled to a pro rata share of the participant's 
maximum survivor benefit (based on service performed prior to the 
divorce) unless a different amount was elected in a spousal agreement 
filed with PER/ER/RET at the time of retirement, or in the case of 
retirement before February 15, 1981, filed with PER/ER/RET within 12 
months after the divorce becomes final, or unless a different amount is 
specified by a court prior to the death of the principal. For this 
purpose, a joint election filed with PER/ER/RET at the time of 
retirement is considered a spousal agreement. If the survivor annuity 
for the former spouse is reduced at the time of the divorce (because the 
pro rata share or the amount specified in a spousal agreement or court 
order is less than the amount elected at retirement), the principal's 
annuity shall be recomputed and paid, effective on the date the survivor 
benefit is reduced, as if the lower amount had been elected at the 
outset of retirement.
    (c) Death or remarriage of former spouse and transfer of survivor 
benefit to a spouse. Remarriage below age 60 or death of a former spouse 
while a principal is alive will disqualify the former spouse for 
benefits under this section. In the event of such a remarriage or death 
of a former spouse, the portion of a principal's survivor annuity 
committed to that person will become available for transfer to any 
spouse. If such a remarriage or death of the former spouse occurs after 
the principal's annuity commences, any reduction in the principal's 
annuity for that former spouse will be discontinued effective at the 
beginning of the first month following the remarriage or death unless 
the annuitant elects to provide or to increase a survivor benefit for a 
spouse. Such an election may be made within one year after the annuitant 
receives notice of the remarriage or death of his/her former spouse. The 
Department (PER/ER/RET) and the annuitant shall each notify the other 
promptly whenever either receives independent notice of such a 
remarriage or death. If an election to transfer survivor benefits to a 
spouse is not made by the annuitant, his/her annuity will be recomputed 
and paid as if there had been no reduction for the discontinued survivor 
benefit. If an annuity is so recomputed and an election is subsequently 
made to designate as beneficiary a spouse to whom married for at least 
one year at the time the election is made, the principal's annuity shall 
be restored retroactively to its former, lower rate and then adjusted by 
cost-of-living increases that have occured since the date of the first 
recomputation. If an election is made for a spouse when the marriage has 
not yet lasted a year, the procedures in Sec. 19.10-4 shall be followed.
    (d) Amount of survivor annuity. The amount of a regular survivor 
annuity is determined under Sec. 19.11-3(c).
    (e) Special rules for election of survivor annuity for a person who 
is a former spouse on February 15, 1981. (1) Any participant, or former 
participant eligible for a deferred annuity which has not yet commenced, 
who, on February 15, 1981 has a former spouse, may at any time prior to 
commencement of annuity, elect, with the consent of any spouse to whom 
married at the time of

[[Page 114]]

the election, to receive a reduced annuity and provide a regular 
survivor annuity for such former spouse. Such survivor annuity shall be 
limited by Sec. 19.10-2(b). An election under this paragraph for a 
former spouse will reduce the amount of any regular survivor annuity 
that may subsequently be provided for any spouse or other former spouse.
    (2) Any former participant in receipt of an annuity who has a former 
spouse on February 15, 1981 and who has not committed his/her entire 
annuity as a base for a regular survivor annuity for a spouse or any 
other former spouse, may, prior to December 31, 1982, designate any 
portion of the uncommitted base as the base for a regular survivor 
annuity for such former spouse.
    (3) The annuity of a former participant making an election under 
this paragraph shall be reduced under Sec. 19.10-2(a) effective February 
15, 1981, or from its commencing date if later.
    (4) An election under this paragraph shall be made by filing a 
spousal agreement with PER/ER/RET under Sec. 19.7. A spousal agreement 
to provide a regular survivor annuity under this paragraph for a former 
spouse may be revoked or amended after its acceptance by PER/ER/RET as 
in accordance with the Act and these regulations, only by agreement of 
the parties up to the last day allowed by this paragraph for filing such 
an agreement. Thereafter, it is irrevocable. If a participant dies in 
service after having filed a valid election under this section, a 
survivor annuity will be paid to an eligible former suriving spouse in 
accordance with the terms of the election.



Sec. 19.11-3  Regular survivor annuity for a spouse.

    (a) In the absence of a joint election or a spousal agreement to the 
contrary, a participant or former participant who is separated from 
active service on or after February 15, 1981 who is married at the 
commencement of his/her annuity shall provide a regular survivor annuity 
for a spouse under Sec. 19.10-2 equal to the maximum amount that remains 
available under limitations stated in paragraph (b) of that section 
after allowing for any commitment of a regular survivor annuity for a 
former spouse who has not remarried prior to age 60 and who is alive on 
the date the former participant becomes eligible for an annuity.
    (b) A regular survivor annuity is also payable to a surviving spouse 
for whom a principal elected an annuity under Sec. 19.10-3, Sec. 19.10-
4, or Sec. 19.11-2(c) following a marriage after comencement of his/her 
annuity.
    (c) The amount of a regular survivor annuity equals 55 percent of 
the base designated for the benefit at the time the principal's annuity 
commenced, adjusted by the total percentage of cost-of-living increases 
the principal was receiving at death.
    (d) A survivor annuity is payable to a surviving spouse only if that 
person was married to the principal at the time of his/her death or if 
the spouse became a former spouse under the definition in Sec. 19.2(k).
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.11-4  Procedure in event a spouse or former spouse is missing.

    If a participant or former participant has a spouse or former spouse 
whose whereabouts are unknown, such participant may elect to reduce or 
eliminate the share of a regular survivor annuity provided for that 
person under Sec. 19.11-2 or Sec. 19.11-3 by filing an affidavit with 
PER/ER/RET stating that his/her spouse or former spouse is missing and 
giving full name, last known address, date last heard from, 
circumstances of the disappearance and a description of the effort that 
has been made to locate the individual. Thereafter, the participant 
shall take such additional steps to locate the missing person as may be 
directed by PER/ER/RET. That Office shall also attempt to locate the 
missing person by sending a letter to the individual's last known 
address given in the Department's files, to the address given on the 
affidavit, and, if a Social Security number is known, to the Social 
Security Administration for forwarding. The election and affidavit may 
be filed at any time before commencement of annuity. It must remain on 
file with PER/ER/RET for at least one year before being given 
irrevocable effect by the Department. If the annuity to the former 
participant becomes

[[Page 115]]

effective prior to the expiration of this one year period, the annuity 
shall be computed and paid without reference to the election filed under 
this section. Following this one-year period, or at the commencement of 
annuity, if later, if the missing person has not been located, the 
affidavit may be reaffirmed by the participant, after which an election 
by the participant to reduce or eliminate the share of regular survivor 
annuity for the missing person shall be given irrevocable effect by the 
Department. If the annuity to the former participant has commenced, it 
shall be recomputed and paid retroactively to give effect to any 
election made under this section.



Sec. 19.11-5  Commencement, termination and adjustment of annuities.

    (a) An annuity payable from the Fund to a surviving spouse or former 
spouse begins on the day after the participant or annuitant dies and 
stops on the last day of the month before the survivor's (1) marriage 
before age 60, or (2) death. If a survivor annuity is terminated because 
of remarriage, the annuity is restored at the same rate effective on the 
date such remarriage is terminated, provided any lump-sum paid upon 
termination of the annuity is returned to the Fund. The termination of a 
surviving spouse annuity due to remarriage does not apply to a survivor 
annuitant who is a surviving spouse of a participant who died in service 
or retired before October 1, 1976, unless elected following a marriage 
after retirement under circumstances described in Sec. 19.10-3 or 
Sec. 19.10-4.
    (b) A surviving spouse or former spouse shall not become entitled to 
a survivor annuity or to the restoration of a survivor annuity payable 
from the Fund unless the survivor elects to receive it instead of any 
other survivor annuity to which entitled under this or any other 
retirement system for Government employees. (For this purpose, neither 
the Social Security system nor the military retirement system is 
considered a retirement system for Government employees.) This 
restriction does not apply to a survivor annuitant who is a surviving 
spouse of a participant who died in service or retired before October 1, 
1976, unless the survivor annuity was elected under circumstances 
described in Sec. 19.10-3 or Sec. 19.10-4.
    (c) A child's annuity begins on the day after the participant dies, 
or if a child is not then qualified, on the first day of the month in 
which the child becomes eligible. A child's annuity shall terminate on 
the last day of the month which precedes the month in which eligibility 
ceases.
    (d) Regular and supplemental survivor annuities to a spouse or 
former spouse of an annuitant described in Secs. 19.11-2, 19.11-3 and 
19.10-6(b) are increased from their effective date by the cumulative 
percentage of cost-of-living increases the annuitant was receiving under 
section 826 of the Act at death. All annuities payable to survivors on 
the date a cost-of-living adjustment becomes effective are increased by 
that percentage except (1) the first increase to a surviving spouse of a 
participant who dies in service shall be pro rated and (2) additional 
survivor annuities under Sec. 19.10-5 when the spousal agreement 
authorizing the annuity makes no provision for cost-of-living increases.
    (e) The annuity of survivors becomes effective as specified in this 
section but is not paid until the survivor submits Form JF-38, 
Application for Death Benefits, supported by such proof as may be 
required, for example, death, marriage, and/or divorce certificates. In 
the event that such is not submitted during an otherwise eligible 
beneficiary's lifetime, no annuity is due or payable to the 
beneficiary's estate.
[46 FR 12958, Feb. 19, 1981. Redesignated and amended at 46 FR 18970, 
Mar. 27, 1981]



Sec. 19.11-6  Death during active duty.

    (a) Annuity for surviving former spouse. In the event a participant 
dies before separation from the Service and leaves a former spouse, such 
former spouse is entitled to a regular survivor annuity under 
Sec. 19.11-2 computed as if the participant had retired on the date of 
death unless a court order or spousal agreement is on file in the 
Department waiving such entitlement or providing for some other 
computation, or unless the former spouse had been found missing and an 
election filed under the procedures of Sec. 19.11-4 waiving a survivor

[[Page 116]]

benefit for that person. Any assumed service authorized to be used under 
paragraph (b) of this section in computing the annuity for a surviving 
spouse may not be counted as ``years of marriage'' when determining 
whether the previous spouse qualifies as a ``former spouse'' under the 
definition in Sec. 19.2(k) or when computing the pro rata share under 
Sec. 19.2(s). A former spouse is entitled to an additional survivor 
annuity under Sec. 19.10-5 provided death occurs on or after the 
effective date of a spousal agreement providing for the additional 
annuity.
    (b) Annuity for surviving spouse. If a participant who has at least 
19 months of civilian service credit toward retirement under the System, 
excluding extra service credited for unhealthful post duty in accordance 
with section 816 of the Act, dies before separation from the Service, 
and is survived by a spouse as defined in Sec. 19.2(v) such survivor 
shall be entitled to an annuity equal to 55 percent of the annuity 
computed in accordance with Sec. 19.10-1 less any annuity payable to a 
former spouse under paragraph a. If the participant had less than three 
years of creditable civilian service at the time of death, the survivor 
annuity is computed on the basis of the average salary for the entire 
period of such service. If, at time of death, the participant had less 
than 20 years of creditable service, the annuity shall be computed on 
the assumption that the participant has had 20 years of service, but 
such additional service credit shall in no case exceed the difference 
between the participant's age on the date of death and age 65. A spouse 
is entitled to an additional survivor annuity under Sec. 19.10-5 
provided death occurs on or after the effective date of a spousal 
agreement providing for the additional annuity.
    (c) Annuity for a child or children. If a participant described in 
paragraph (b) of this section is survived by a child or children, each 
surviving child is entitled to an annuity as described in Sec. 19.11-7.
    (d) Annuity changes. Annuities based on a death in service are 
subject to the provisions of Sec. 19.11-5 governing commencement, 
adjustment, termination and resumption of annuities.



Sec. 19.11-7  Annuity payable to surviving child or children.

    (a) If a participant who has at least 18 months of civilian service 
credit under the System dies in service, or if an annuitant who was a 
former participant dies, annuities are payable to a surviving child or 
children, as defined in Sec. 19.2(e) as follows:
    (1) When survived by spouse and child or children. If a principal is 
survived by a wife or husband and by a child or children, in addition to 
any other annuity, there shall be paid to or on behalf of each child an 
annuity equal to the smallest of:
    (i) $900
    (ii) $2,700 divided by the number of children--adjusted under 
paragraph (b).
    (2) When survived by a child or children but no spouse. If the 
principal is not survived by a wife or husband, but by a child or 
children, each surviving child shall be paid an annuity equal to the 
smallest of:
    (i) $1,080
    (ii) $3,240 divided by the number of children--adjusted under 
paragraph (b) of this section.
    (b) Adjusted rates. In order to reflect cost-of-living increases, 
the amounts referred to in paragraphs (a)(1) and (2) are increased from 
the commencing date of the annuity to each child by the cumulative 
percentage of all cost-of-living increases that have occurred under 5 
U.S.C. 8340 since October 31, 1969.
    (c) Recomputation of annuity for child or children. If a surviving 
wife or husband dies or the annuity of a child is terminated, the 
annuities of any remaining children shall be recomputed and paid as 
though such spouse or child had not survived the participant. If the 
annuity to a surviving child who has not been receiving an annuity is 
initiated or resumed, the annuities of any other children shall be 
recomputed and paid from that date as though the annuities to all 
currently eligible children in the family were then being initiated.

[[Page 117]]



Sec. 19.11-8  Required elections between survivor benefits.

    (a) Bar against concurrent payment under this Act and Workers' 
Compensation Act. Except as stated below, survivor annuities and 
survivors' compensation for work injuries under 5 U.S.C. 8102 are not 
payable concurrently if both are based on the death of the same 
employee. A survivor entitled to both must elect which of the two 
benefits he/she prefers. Should all eligible survivors of a deceased 
employee elect to receive the compensation benefit rather than the 
survivor annuity, their rights to the latter are terminated and, if the 
lump-sum credit has not been exhausted, a lump-sum payment will become 
due under Sec. 19.13. The one exception to this rule occurs when a widow 
or widower is being paid the balance of a scheduled compensation award 
under 5 U.S.C. 8107 due the deceased employee. If so, the widow or 
widower may receive the survivor annuity and compensation award 
concurrently.
    (b) Election between survivor annuity and social security benefits. 
Pursuant to 42 U.S.C. 417 (a) and (e), survivors who are eligible for 
annuity which is based in part on military service performed by a 
principal between September 16, 1940, and December 31, 1956, and also 
for survivor benefits under the Social Security system, may elect to 
have the military service credited toward the Social Security benefit. 
In practice, the survivors should apply for both benefits, ask the 
Department and the Social Security Administration for statements showing 
the amount of each benefit, and then make their election of where to 
credit the military service. If Social Security benefits are elected, 
the rights of all survivors to a foreign service annuity are terminated.



Sec. 19.12  Employment in a Government agency.

    An annuitant who is reemployed by a Federal Government agency may 
not receive a combination of salary and annuity which exceeds his/her 
Foreign Service salary at the time of retirement. Refer to Sec. 19.9-4.



Sec. 19.13  Lump-sum payment.



Sec. 19.13-1  Lump-sum credit.

    ``Lump-sum credit'' is the compulsory and special contributions to a 
participant's or former participant's credit in the Fund for his/her 
first 35 years of service plus interest thereon computed from the 
midpoint of each service period and compounded at four percent annually 
to the date of separation or December 31, 1976, whichever is earlier, 
and after such date, for a participant who separates from the Service 
after completing at least one year of civilian service and before 
completing 5 years of such service, at the rate of three percent 
annually to the date of separation. Interest shall not be paid for a 
fractional part of a month in the total service or on compulsory and 
special contributions from the annuitant for recall service or other 
service performed after the date of separation which forms the basis for 
annuity.



Sec. 19.13-2  Share payable to a former spouse.

    A former spouse of a participant or annuitant is entitled to a 
prorata share of 50 percent of any lump-sum payment authorized to be 
paid to a former participant under this section who separated from the 
Service on or after February 15, 1981, unless otherwise directed in a 
court order or a spousal agreement.



Sec. 19.13-3  Payment after death of principal.

    If a participant or former participant dies and no claim for annuity 
is payable, the lump-sum credit is paid to surviving beneficiaries.



Sec. 19.14  Waiver of annuity.

    An individual entitled to be paid an annuity may, for personal 
reasons, decline to accept all or any part of the annuity. However, a 
principal may not waive the portion of his/her annuity authorized to be 
paid to a former spouse under Sec. 19.7 or Sec. 19.9 or to a beneficiary 
under Sec. 19.6. An annuity waiver shall be in writing and sent to the 
Department (PER/ER/RET). A waiver may be revoked in writing at any time. 
Payment of the annuity waived may

[[Page 118]]

not be made for the period during which the waiver was in effect.



PART 20--BENEFITS FOR CERTAIN FORMER SPOUSES--Table of Contents




Sec.
20.1  Definitions.
20.2  Funding.
20.3  Qualifications.
20.4  Retirement benefits.
20.5  Survivor benefits.
20.6  COLA.
20.7  Waiver.
20.8  Effect on other benefits.
20.9  Application procedure.

    Authority:  22 U.S.C. 3901 et seq.

    Source:  53 FR 39457, Oct. 7, 1988, unless otherwise noted.



Sec. 20.1  Definitions.

    As used in this part, unless otherwise specified, the following have 
the meaning indicated:
    COLA means cost-of-living adjustment in annuity.
    Creditable service or service means employment or other periods that 
are counted under sections 816, 817, or 854 in determining retirement 
benefits.
    Disability annuitant means a participant in FSRDS or FSPS entitled 
to a disability annuity under section 808 of the Act or subchapter V, 
chapter 84, title 5 U.S.C., and a disability annuity means a Foreign 
Service annuity computed under those sections.
    FSRDS means the Foreign Service Retirement and Disability System 
established by subchapter I, chapter 8, of the Act.
    FSPS means the Foreign Service Pension System established by 
subchapter II, chapter 8, of the Act.
    Former spouse means a former wife or husband of a participant or 
former participant who was married to such participant for not less than 
10 years during service of the participant which is creditable under 
chapter 8 of the Act with at least 5 years occurring while the employee 
was a member of the Foreign Service and who retired from the Foreign 
Service Retirement System.
    Full annuity equals the annuity the former participant would be 
eligible to receive except for deductions made to provide survivor 
benefits or because of payment of a portion of the annuity to others.
    Participant means a person who contributes to the Fund identified in 
Sec. 20.2. Such person may participate in either FSRDS or FSPS.
    Principal means a participant or former participant whose service 
forms the basis for a benefit for a former spouse under this part.
    Pro rata share, in the case of a former spouse of a participant or 
former participant, means the percentage obtained by dividing the number 
of months during which the former spouse was married to the participant 
during the creditable service of the participant by the total number of 
months of such creditable service. In the total period, 30 days 
constitutes a month and any period of less than 30 days is not counted. 
When making this calculation for a former spouse married to a 
participant during a period the participant earned extra service credit 
under section 817 of the Act, the number of months of such extra service 
credit earned during that period of the marriage shall be added to the 
total number of months of the marriage.



Sec. 20.2  Funding.

    Benefits under this part are paid from the Fund maintained by the 
Secretary of the Treasury pursuant to section 802 of the Act but are not 
authorized to be paid except to the extent provided therefor. 
Appropriations for such Fund are authorized by section 821(a) of the 
Act.



Sec. 20.3  Qualifications.

    To be eligible for retirement or survivor benefits under this part, 
a former spouse must--
    (a) Have been a former spouse on February 14, 1981;
    (b) After becoming a former spouse, not have remarried before 
attaining age 55;
    (c) In the case of any retirement benefit under Sec. 20.5; elect 
this benefit instead of any survivor annuity for which the former spouse 
may simultaneously be eligible under this or another retirement system 
for Government employees; and
    (d) Submit an application to the Department of State by June 22, 
1990, in

[[Page 119]]

accordance with Sec. 20.9 unless that date is extended as authorized by 
that section. The deadline for submission of an application for survivor 
benefits under Sec. 20.5 will be deemed to have been met if the former 
spouse submits an application for retirement benefits within the 
deadline.



Sec. 20.4  Retirement benefits.

    (a) Type of benefits. (1) A former spouse who meets the 
qualification requirements of Sec. 20.3 is entitled to a share of any 
Foreign Service annuity (other than a disability annuity) or any 
supplemental annuity computed under section 806(a), 823 or 824 of the 
Act to which the principal is entitled under FSRDS and to any Foreign 
Service annuity (other than a disability annuity) or annuity supplement 
computed under section 824 or 855 of the Act of 5 U.S.C. 8415 to which 
the principal is entitled under FSPS.
    (2) A former spouse of a disability annuitant is entitled to a share 
of benefits to which the annuitant would qualify under paragraph (a) of 
this section, he or she not been disabled based on the actual age and 
service of the annuitant.
    (b) Share. The share of a participant's benefits to which a 
qualified former spouse is entitled is--
    (1) 50 percent of the benefits described in Sec. 20.4(a) if the 
former spouse was married to the participant throughout the latter's 
creditable service; or
    (2) A pro rata share of 50 percent of such benefits if the former 
spouse was not married to the participant throughout such creditable 
service.
    (c) Reduction of benefits. If retirement benefits of a principal are 
reduced because of reemployment, attainment of eligibility for Social 
Security benefits or for any other reason, the amount of the share 
payable to a former spouse is correspondingly reduced during the period 
of the reduction.
    (d) Commencement, Termination and Suspension. (1) Entitlement to 
retirement benefits under this section (except for a former spouse of a 
disability annuitant) shall commence on the latter of--
    (i) The day the principal becomes entitled to benefits described in 
Sec. 20.4(a); or
    (ii) December 22, 1987.
    (2) Entitlement to retirement benefits under this section for a 
former spouse of a disability annuitant shall commence on the latter 
of--
    (i) The date the principal would qualify for benefits (other than a 
disability annuity) described in Sec. 20.4(a) on the basis of the 
principal's actual age and service;
    (ii) The date the disability annuity begins; or
    (iii) December 22, 1987.
    (3) Entitlement to retirement benefits under this section shall 
terminate or be suspended on the earlier of--
    (i) Last day of the month before the former spouse dies or remarries 
before attaining age 55;
    (ii) Date benefits of the principal terminate or are suspended 
because of death, recall, reemployment, recovery from disability or for 
any other reason.
    (4) Entitlement to benefits under this section shall be resumed for 
a former spouse, following their suspension, or the date they are 
resumed for the principal.



Sec. 20.5  Survivor benefits.

    (a) Type of benefits. A former spouse who meets the eligibility 
requirements of Sec. 20.3 is entitled to survivor benefits equal to one 
of the following; whichever is applicable:
    (1) 55 percent of the full annuity to which the principal was 
entitled on the commencement or recomputation date of the annuity in the 
case of a principal who dies while in receipt of a Foreign Service 
annuity computed under section 806, 808, 823, 824, or 855 of the Act of 
5 U.S.C. 8415;
    (2) 55 percent of the annuity to which the principal was entitled at 
death in the case of a principal who dies while in receipt of a Foreign 
Service annuity computed under 5 U.S.C. 8452;
    (3) 55 percent of the full annuity to which the principal would have 
been entitled if he or she retired (or returned to retirement status) on 
the date of death computed--depending on the provision that would be 
used to compute an annuity for a surviving spouse of the principal--
under section

[[Page 120]]

806(a), 823, 824, or 855(b) of the Act of 5 U.S.C. 8415 and using the 
actual service of the principal, in the case of a principal who dies 
while in active service, including service on recall or reemployment 
while annuity is suspended or reduced; or,
    (4) 55 percent of the full annuity computed under 5 U.S.C. 8413(b) 
that the principal could have elected to receive commencing on the date 
of death or, if later, commencing on the date the principal would have 
attained the minimum retirement age described in 5 U.S.C. 8412(h), in 
the case of a principal while entitled to a deferred annuity under 5 
U.S.C. 8413(b), but before commencement of that annuity. A survivor 
annuity under this paragraph may not commence before the date the 
principal would have attained the minimum retirement age.
    (b) Effect of Election of Alternate Form Annuity. If a principal 
elects an alternate form annuity under section 829 of the Act or 5 
U.S.C. 8420a, survivor benefits for a former spouse under this section 
shall, nevertheless, be based on what the principal's annuity would have 
been had the principal not withdrawn retirement contributions in a lump 
sum.
    (c) Reduction Because of Receipt of Other Survivor Benefits. If a 
former spouse is in receipt of a survivor annuity based on an election 
by the principal under section 806(f) or 2109 of the Act, the survivor 
benefits for the former spouse under this section shall be reduced on 
the effective date by the amount of such elected survivor annuity.
    (d) Commencement and Termination. Entitlement to survivor benefits 
under this section--
    (1) Shall commence on the latter of--
    (i) The date the principal dies;
    (ii) December 22, 1987; and
    (2) Shall terminate on the last day of the month before the former 
spouse dies or remarries before attaining age 55.



Sec. 20.6  COLA.

    (a) Retirement Benefits. A retirement annuity payable to a former 
spouse under Sec. 20.4 is adjusted for cost-of-living increases under 
section 826 or 858 of the Act in the same manner as the annuity of the 
principal. The first such increase for a former spouse shall be prorated 
under the applicable section in the same way the first increase for the 
principal is adjusted, irrespective of whether the annuity to the former 
spouse commences on the same date as the annuity to the principal. If 
the benefit of a former spouse is based in part on an annuity supplement 
payable to a principal under 5 U.S.C. 8421 which is not adjusted by 
COLA, then that portion of the benefit payable to a former spouse is not 
adjusted by COLA.
    (b) Survivor Benefits. (1) Survivor annuities payable to a former 
spouse are adjusted for COLA under section 826 or 858 of the Act in the 
same manner as annuities are or would be adjusted for other survivors of 
the principal.
    (2) A survivor annuity payable to a former spouse under Sec. 20.5-
1(A) shall be increased from its commencing date pursuant to paragraph 
(c)(2) of section 826 of the Act or 8462 of Title 5, U.S. Code, by all 
COLA received by the principal at death, irrespective of the date of 
death and in instances where death occurred prior to December 22, 1987, 
by all COLA that would have been paid to a survivor annuitant from the 
date of death until December 22, 1987.
    (3) The first increase to which a former spouse becomes entitled 
whose annuity is computed under Sec. 20.5(a)(2) shall be prorated 
pursuant to 5 U.S.C. 8462(c)(4).
    (4) The first increase to which a former spouse becomes entitled 
whose annuity is computed under Sec. 20.5(a)(3) or
    (5) Shall be prorated pursuant to paragraph (c)(1) of section 826 of 
the Act or 8462 or title 5, U.S. Code.



Sec. 20.7  Waiver.

    A former spouse entitled to an annuity under this part may decide to 
decline all or any part of the annuity for personal reasons. An annuity 
waiver shall be in writing and sent to the Retirement Division (PER/ER/
RET), Department of State, Washington, DC 20520. A waiver may be revoked 
in writing at any time. Payment of the annuity waived prior to receipt 
by the Retirement Division of the renovation may not be made.

[[Page 121]]



Sec. 20.8  Effect on other benefits.

    Payment to a former spouse under this part shall not impair, reduce, 
or otherwise affect benefits paid under the Act to the principal or 
other persons.



Sec. 20.9  Application procedure.

    (a) Submission of Application. To be eligible for retirement or 
survivor benefits under this part, a former spouse must submit a 
properly executed and completed application to the Department of State 
by June 22, 1990 or, if an exception is made for compelling cause to 
this deadline, within 60 days following the date of the letter from the 
Department transmitting the application to the former spouse. The 
application must be delivered or mailed to the Retirement Division (PER/
ER/RET), Room 1251, Department of State, Washington, DC 20520.
    (b) Request for Application. The Department of State has attempted 
to mail applications to all former spouses of whom it is aware that it 
believes may be eligible for benefits under this part. Any eligible 
former spouse who does not have an application at the time this part is 
published in the Federal Register (October 7, 1988) must communicate 
with the Department as soon as possible and request an application. 
Request may be in person or by mail to the address in Sec. 20.9(a) or by 
telephoning the Retirement Division on area code 202-647-9315. A request 
by letter must include the typed or printed full name and current 
address of the former spouse.
    It shall also give the dates of marriage and divorce or annulment 
that establish eligibility and fully identify the Foreign Service 
employee or former employee in question and state the agency of current 
or last employment.
    (c) Payment of Benefits Delayed. Payment of benefits cannot be made 
to a former spouse until the application for benefits is approved by the 
Retirement Division of the Department. Upon such approval, benefits will 
be paid to an eligible former spouse retroactively, if necessary, back 
to the commencing date determined under this part.



PART 21--INDEMNIFICATION OF EMPLOYEES--Table of Contents




    Authority:  5 U.S.C. 301; 22 U.S.C. 2658.

    Source:  60 FR 29988, June 7, 1995, unless otherwise noted.



Sec. 21.1  Policy.

    (a) The Department of State may indemnify an employee for any 
verdict, judgment, or other monetary award which is rendered against 
such employee, provided that the conduct giving rise to the verdict, 
judgment, or award was taken within the scope of employment and that 
such indemnification is in the interest of the United States, as 
determined as a matter of discretion by the Under Secretary for 
Management or his or her designee.
    (b) The Department of State may settle or compromise a personal 
damages claim against an employee by the payment of available funds at 
any time, provided the alleged conduct giving rise to the personal 
damages claim was taken within the scope of employment and that such 
settlement or compromise is in the interest of the United States, as 
determined as a matter of discretion by the Under Secretary for 
Management or his or her designee.
    (c) The Director General of the Foreign Service and Director of 
Personnel (``Director General'') shall be the designee of the Under 
Secretary for Management with respect to determinations under paragraphs 
(a) and (b) of this section in cases which involve:
    (1) Foreign courts or foreign administrative bodies and
    (2) Requests of less than five thousand dollars.
    (d) Absent exceptional circumstances as determined by the Under 
Secretary for Management or his or her designee, the Department will not 
entertain a request either to agree to indemnify or to settle a personal 
damages claim before entry of an adverse verdict, judgment, or award.
    (e) When an employee in the United States becomes aware that an 
action has been filed against the employee in his or her personal 
capacity as a result of conduct taken within the scope of his or her 
employment, the employee

[[Page 122]]

shall immediately notify the Department through the Executive Director 
of the Office of the Legal Adviser that such an action is pending. 
Employees overseas shall notify their Administrative Counselor who shall 
then notify the Assistant Legal Adviser for Special Functional Problems. 
Employees may be authorized to receive legal representation by the 
Department of Justice in accordance with 28 CFR 50.15.
    (f) The employee may thereafter request indemnification to satisfy a 
verdict, judgment, or award entered against the employee. The employee 
shall submit a written request, with appropriate documentation including 
copies of the verdict, judgment, award, or settlement proposal if on 
appeal, to the Legal Adviser. Except as provided in paragraph (g) of 
this section, the Legal Adviser and the Director General shall then, in 
coordination with the Bureau of Finance and Management Policy, forward 
the request with their recommendation to the Under Secretary for 
Management for decision. The Legal Adviser may seek the views of the 
Department of Justice, as appropriate, in preparing this recommendation.
    (g) Cases in which the Director General is the designee under 
paragraph (c) of this section may be forwarded by the Assistant Legal 
Adviser for Special Functional Problems, along with the views of the 
employee and the bureau or post as appropriate, to the Director General 
for decision.
    (h) Personal services contractors of the Department are considered 
employees for purposes of the policy set forth in this part.
    (i) Any payment under this part either to indemnify a Department of 
State employee or to settle a personal damages claim shall be contingent 
upon the availability of appropriated funds.
    (j) In addition to the indemnification provisions contained in the 
regulations in this part, the Department will also follow any specific 
policies or regulations adopted with respect to damages awarded against 
Department health care personnel for malpractice claims within the scope 
of 22 U.S.C. 2702.
[60 FR 29988, June 7, 1995]

[[Page 123]]



                      SUBCHAPTER C--FEES AND FUNDS





PART 22--SCHEDULE OF FEES FOR CONSULAR SERVICES--DEPARTMENT OF STATE AND FOREIGN SERVICE--Table of Contents




Sec.
22.1  Schedule of fees.
22.2  Requests for services in the United States.
22.3  Remittances in the United States.
22.4  Requests for services, Foreign Service.
22.5  Remittances to Foreign Service posts.
22.6  Refund of fees.
22.7  Collection and return of fees.

    Authority:  8 U.S.C. 1153 note, 1351, 1351 note; 10 U.S.C. 2602(c); 
22 U.S.C. 214, 2504(a), 4201, 4206, 4215, 4219; 31 U.S.C. 9701; E.O. 
10718, 22 FR 4632, 3 CFR, 1954-1958 Comp., p. 382; E.O. 11295, 31 FR 
10603, 3 CFR, 1966-1970 Comp., p. 570.

    Source:  46 FR 58071, Nov. 30, 1981, unless otherwise noted.



Sec. 22.1  Schedule of fees.

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                       Item No.                                                    Fee                          
----------------------------------------------------------------------------------------------------------------
                                        Passport and Citizenship Services                                       
----------------------------------------------------------------------------------------------------------------
1. Passport Services:                                                                                           
        (a) Execution. Required for first-time          $15.00.                                                 
         applicants and renewals under age 16.                                                                  
        (b) First-time issuance:                                                                                
        (1) Applicants age 16 or over.................  $45.00 plus expedited processing fee if applicable.     
        (2) Applicants under age 16...................  $25.00 plus expedited processing fee if applicable.     
        (c) Subsequent issuance (renewal):                                                                      
        (1) Applicants age 16 or over.................  $40.00 plus expedited processing fee if applicable.     
        (2) Applicants under age 16...................  $25.00 plus expedited processing fee if applicable.     
        (d) Expedited service (exclusive of express                                                             
         mail charges) not applicable overseas:                                                                 
        (1) Requested guaranteed 3-day service........  $35.00.                                                 
        (2) In-person service at a U.S. Passport        $35.00.                                                 
         Agency, unless the Department has determined                                                           
         that the applicant is required to apply at a                                                           
         U.S. Passport Agency.                                                                                  
2. Exemptions: The following applicants are exempted                                                            
 from passport fees:                                                                                            
        (a) Officers or employees of the United States  No fee.                                                 
         proceeding abroad or returning to the United                                                           
         States in the discharge of their official                                                              
         duties, or their immediate family members (22                                                          
         U.S.C. 214).                                                                                           
        (b) American seamen who require a passport in   No fee.                                                 
         connection with their duties aboard an                                                                 
         American flag vessel (22 U.S.C. 214).                                                                  
        (c) Widows, children, parents, or siblings of   No fee.                                                 
         deceased members of the Armed Forces                                                                   
         proceeding abroad to visit the graves of such                                                          
         members (22 U.S.C. 214).                                                                               
        (d) Employees of the American National Red      No fee.                                                 
         Cross proceeding abroad as members of the                                                              
         Armed Forces of the United States (10 U.S.C.                                                           
         2602(c)).                                                                                              
        (e) Peace Corps and Volunteer Leaders deemed    No fee.                                                 
         to be employees of the United States for                                                               
         purposes of exemption from passport fees (22                                                           
         U.S.C. 2504(a)).                                                                                       
3. File search and verification of U.S. citizenship     $15.00.                                                 
 when applicant has not presented evidence of                                                                   
 citizenship and previous records must be searched.                                                             
 (This fee will not be charged when the applicant's                                                             
 passport was stolen or lost overseas or when one of                                                            
 the exemptions in item 38 is applicable.).                                                                     
4. Determination or adjudication of U.S. citizenship    $100.00.                                                
 for applicants born overseas who have not presented a                                                          
 U.S. passport, Report of Birth Abroad of a Citizen of                                                          
 the United States, or Certificate of Naturalization                                                            
 or Citizenship from the Immigration and                                                                        
 Naturalization Service.                                                                                        
5. Passport amendments, to add current or new           No fee.                                                 
 information, change a name, extend a previous                                                                  
 passport time limitation, correct an administrative                                                            
 error, validate a passport for travel to restricted                                                            
 countries, or add extra pages.                                                                                 
6. Passport waiver (22 CFR 53.2(h), Passport            No fee.                                                 
 requirement and exceptions).                                                                                   
7. Registration of a U.S. Citizen at a U.S. Embassy or  No fee.                                                 
 Consulate when documentary proof of U.S. citizenship                                                           
 has been presented.                                                                                            
8. Report of Birth Abroad of a Citizen of the United    $40.00.                                                 
 States (includes new no. 4).                                                                                   

[[Page 124]]

                                                                                                                
9. Issuance of Replacement Report of Birth Abroad of a  $40.00.                                                 
 Citizen of the United States by the Department of                                                              
 State in Washington. For fees relating to obtaining                                                            
 documents from passport files and related records,                                                             
 see Documentary Services, item 35 and succeeding.                                                              
(Item nos. 10 through 14 vacant.)                                                                               
----------------------------------------------------------------------------------------------------------------
              Overseas Citizens Services                                                                        
General Overseas Assistance:                                                                                    
    15. Arrest visits.................................  No fee.                                                 
    16. Assistance regarding the welfare and            No fee.                                                 
     whereabouts of a U.S. Citizen, including child                                                             
     custody inquiries.                                                                                         
    17. Loan processing:                                                                                        
        (a) Repatriation loans........................  No fee.                                                 
        (b) Emergency dietary assistance loans........  No fee.                                                 
(Item Nos. 18-20 vacant.)                                                                                       
Death and Estate Services:                                                                                      
    21. Identification of remains and consultation      No fee.                                                 
     with family members of a U.S. Citizen.                                                                     
    22. Assistance to the next-of-kin in making         No fee.                                                 
     arrangements for shipping or other disposition of                                                          
     remains of a U.S. Citizen.                                                                                 
    23. Affidavit attesting to preparation and packing  No fee.                                                 
     of remains of a U.S. Citizen.                                                                              
    24. Issuance of consular mortuary certificate on    No fee.                                                 
     behalf of a U.S. Citizen.                                                                                  
    25. Assistance in transshipment of remains of a     $700.00.                                                
     foreign national to or through the United States,                                                          
     including documentation covered by items 23 and                                                            
     24.                                                                                                        
    26. Preparation of Report of Death of an American   No fee.                                                 
     Citizen Abroad, including sending copies to legal                                                          
     representative and closest known relative or                                                               
     relatives.                                                                                                 
    27. Acting as a provisional conservator of estates  No fee.                                                 
     of U.S. Citizens (other than U.S. Government                                                               
     employees), by taking possession of, making an                                                             
     inventory, and placing the official seal.                                                                  
    28. Acting as a provisional conservator of estates                                                          
     of U.S. Citizens (other than U.S. Government                                                               
     employees), by overseeing the appraisal, sale,                                                             
     and final disposition of the estate, disbursing                                                            
     funds, forwarding securities, etc.:                                                                        
        (a) Estates under $10,000.....................  No fee.                                                 
        (b) Estates $10,000 or more, for rendering      Consular time (item 70) and costs.                      
         services additional to taking possession,                                                              
         inventorying, and placing the official seal.                                                           
(Item no. 29 vacant.)                                                                                           
----------------------------------------------------------------------------------------------------------------
        Services Relating to Vessels and Seamen                                                                 
30. Shipping and seamen services, including recording   Per service, $80.00.                                    
 of bill of sale of vessel purchased abroad, taking of                                                          
 application for certificate of American ownership,                                                             
 and investigation.                                                                                             
31. Documentary services related to shipping,           Per service, $650.00 plus costs incurred.               
 including issuance of certificate of American                                                                  
 ownership.                                                                                                     
32. Services provided for an American vessel (a vessel  No fee.                                                 
 with a certificate of American ownership) or American                                                          
 seamen. (22 U.S.C. 4206).                                                                                      
(Items nos. 33-34 vacant.)                                                                                      
----------------------------------------------------------------------------------------------------------------
                 Documentary Services                                                                           
35. Notarials.........................................  $55.00.                                                 
36. Certifications:                                                                                             
        (a) Certifying under official seal that a copy  $20.00; each additional copy $10.00.                    
         or extract made from an official or a private                                                          
         document is a true copy.                                                                               
        (b) Certifying under official seal a statement  $20.00; each additional copy $10.00.                    
         or extract from official files or a statement                                                          
         that no record of an official file can be                                                              
         located.                                                                                               
        (c) Certifying the fact of issuance of a        $20.00; each additional copy $10.00.                    
         Report of Birth Abroad of a Citizen of the                                                             
         United States and certifying copies of                                                                 
         documents relating to births, marriages, and                                                           
         deaths of citizens abroad issued by a U.S.                                                             
         Embassy or Consulate (obtainable from the                                                              
         Department of State, Washington, D.C.).                                                                
37. Authentications:                                                                                            
        (a) Certifying to official character of a       $32.00.                                                 
         foreign notary or other official (i.e.,                                                                
         authenticating a document).                                                                            
        (b) Authenticating a federal, state, or         $32.00.                                                 
         territorial seal, or certifying to the                                                                 
         official status of an officer of the United                                                            
         States Department of State or of a foreign                                                             
         diplomatic or consular officer accredited to                                                           
         or recognized by the United States                                                                     
         Government, or any document submitted to the                                                           
         Department for that purpose.                                                                           
38. Exemptions: Notarial, certification, and                                                                    
 authentication fees (items 35, 36, and 37) or                                                                  
 passport file search fees (item 3) will not be                                                                 
 charged when the service is performed:                                                                         

[[Page 125]]

                                                                                                                
        (a) At the direct request of any federal        No fee.                                                 
         government agency (unless substantial costs                                                            
         would be incurred).                                                                                    
        (b) At the direct request of any state or       No fee.                                                 
         local government, the District of Columbia,                                                            
         or any of the territories or possessions of                                                            
         the United States (unless substantial costs                                                            
         would be incurred).                                                                                    
        (c) With respect to documents to be presented   No fee.                                                 
         by claimants, beneficiaries, or their                                                                  
         witnesses in connection with obtaining                                                                 
         federal, state, or municipal monetary                                                                  
         benefits.                                                                                              
        (d) For American citizens outside the United    No fee.                                                 
         States preparing ballots for any public                                                                
         election in the United States or any of its                                                            
         territories.                                                                                           
        (e) At the direct request of a foreign          No fee.                                                 
         government or an international agency of                                                               
         which the United States is a member if the                                                             
         documents are for official noncommercial use.                                                          
        (f) At the direct request of a foreign          No fee.                                                 
         government official when appropriate or as a                                                           
         reciprocal courtesy.                                                                                   
        (g) At the direct request of U.S. Government    No fee.                                                 
         personnel, Peace Corps volunteers, or their                                                            
         dependents stationed or travelling officially                                                          
         in a foreign country.                                                                                  
        (h) With respect to documents whose production  No fee.                                                 
         is ordered by a court of competent                                                                     
         jurisdiction.                                                                                          
        (i) With respect to affidavits of support for   No fee.                                                 
         immigrant visa applications.                                                                           
39. Executing commissions to take testimony in          No fee.                                                 
 connection with foreign documents for use in criminal                                                          
 cases when the commission is accompanied by an order                                                           
 of federal court on behalf of an indigent party.                                                               
40. Providing seal and certificate for return of        $455.00.                                                
 letters rogatory executed by foreign officials.                                                                
41. Taking depositions or executing commissions to      Per hour, $200.00 plus costs incurred.                  
 take testimony.                                                                                                
(Items nos. 42-49 vacant.)                                                                                      
----------------------------------------------------------------------------------------------------------------
                     Visa Services                                                                              
50. Immigrant visa application processing fee.........  $260.00.                                                
51. Immigrant visa application surcharge for Diversity  $75.00.                                                 
 Visa Lottery.                                                                                                  
52. Immigrant visa issuance fee.......................  $65.00.                                                 
53. Refugee case preparation and processing...........  No fee.                                                 
54. Nonimmigrant visa application processing fee......  $45.00.                                                 
55. EXEMPTIONS from nonimmigrant visa application                                                               
 processing fee:                                                                                                
        (a) Applicants for A, G, C-2, C-3, and NATO     No fee.                                                 
         visas.                                                                                                 
        (b) Applicants for J visas participating in     No fee.                                                 
         official U.S. Government (USIA or USAID)                                                               
         sponsored educational and cultural exchanges.                                                          
        (c) Persons issued replacement machine          No fee.                                                 
         readable visas when the original machine                                                               
         readable visa has not adhered to the passport                                                          
         or other travel document through no fault of                                                           
         the applicant.                                                                                         
        (d) Persons exempted by international           No fee.                                                 
         agreement as determined by the Department.                                                             
        (e) Persons travelling to participate in        No fee.                                                 
         charitable activities as determined by the                                                             
         Department.                                                                                            
56. Nonimmigrant visa issuance fee, including border    RECIPROCAL.                                             
 crossing cards.                                                                                                
57. EXEMPTIONS from nonimmigrant visa issuance fee:                                                             
        (a) An official representative of a foreign     No fee.                                                 
         government or an international or regional                                                             
         organization of which the U.S. is a member.                                                            
        (b) An applicant transiting to and from the     No fee.                                                 
         United Nations headquarters.                                                                           
        (c) An applicant participating in a U.S.        No fee.                                                 
         Government sponsored program.                                                                          
        (d) Persons travelling to participate in        No fee.                                                 
         charitable activities as determined by the                                                             
         Department.                                                                                            
58. Visa fingerprinting...............................  $25.00.                                                 
59. Special visa processing services for aliens:                                                                
        (a) Returning resident status.................  $50.00.                                                 
        (b) Transportation letter (unless waived in     $120.00.                                                
         significant public benefit parole cases).                                                              
        (c) Waiver of immigrant visa ineligibility      $95.00.                                                 
         (collected for INS; subject to change).                                                                
60. Filing immigrant visa petition (collected for INS;  $80.00.                                                 
 subject to change).                                                                                            
(Items nos. 61-64 vacant.)                                                                                      
----------------------------------------------------------------------------------------------------------------
                Administrative Services                                                                         
65. Non-emergency telephone calls.....................  Local long distance rate plus $10.00.                   
66. Setting up and maintaining a trust account for 1    $20.00.                                                 
 year or less to transfer funds to or for the benefit                                                           
 of an American in need in a foreign country.                                                                   
67. Transportation charges incurred in the performance  Costs incurred.                                         
 of fee and no-fee services when appropriate and                                                                
 necessary.                                                                                                     
68. Emergency passport photo service overseas.........  No fee.                                                 
69. Return check processing fee (only in the United     $25.00.                                                 
 States).                                                                                                       

[[Page 126]]

                                                                                                                
70. Consular time charges as required by this schedule  Per hour, $180.00 plus costs incurred.                  
 or for fee services performed away from the office or                                                          
 after-duty-hours.                                                                                              
71. Photocopies (provided other than pursuant to 22     Per page, $1.00.                                        
 CFR Part 171 or order of a court of competent                                                                  
 jurisdiction).                                                                                                 
(Item nos. 72-80 vacant.)                                                                                       
----------------------------------------------------------------------------------------------------------------

[63 FR 5100, Jan. 30, 1998]



Sec. 22.2  Requests for services in the United States.

    (a) Requests for records. Requests by the file subject of the 
individual's authorized agent for services involving U.S. passport 
applications and related records, including consular birth, marriage and 
death records and authentication of other passport file documents, shall 
be addressed to Passport Services, Correspondence Branch, Department of 
State, Washington, DC 20524. Requests for consular birth records should 
specify if a Consular Report of Birth (Form FS 240, or long form) or 
Certification of Birth (Form DS 1350, or short form) is desired. Advance 
remittance of the exact fee is required for each service.
    (b) Authentication services. Requests for Department of State 
authentication of documents other than passport file documents must be 
accompanied by remittance of the exact total fee chargeable and 
addressed to the Authentication Officer, Department of State, 
Washington, DC 20520.



Sec. 22.3  Remittances in the United States.

    (a) Type of Remittance. Remittances shall be in the form of: (1) 
Check or bank draft drawn on a bank in the United States; (2) money 
order--postal, international or bank; or (3) U.S. currency. Remittances 
shall be made payable to the order of the Department of State. The 
Department will assume no responsibility for cash which is lost in the 
mail.
    (b) Exact payment of fees. Fees must be paid in full prior to 
issuance of requested documents. If uncertainty as to the existence of a 
record or as to the number of sheets to be copied precludes remitting 
the exact fee chargeable with the request, the Department of State will 
inform the interested party of the exact amount required.



Sec. 22.4  Requests for services, Foreign Service.

    Officers of the Foreign Service shall charge for official services 
performed abroad at the rates prescribed in this schedule, in coin of 
the United States or at its representative value in exchange (22 U.S.C. 
1202). For definition of representative value in exchange, see Sec. 23.4 
of this chapter. No fees named in this schedule shall be charged or 
collected for the official services to American vessels and seamen (22 
U.S.C. 1186). The term ``American vessels'' is defined to exclude, for 
the purposes of this schedule, undocumented American vessels and the 
fees prescribed herein shall be charged and collected for such 
undocumented vessels. However, the fees prescribed herein shall not be 
charged or collected for American public vessels, which includes any 
vessel owned or operated by a U.S. Government department or agency and 
engaged exclusively in official business on a non-commercial basis. This 
schedule of fees shall be kept posted in a conspicuous place in each 
Foreign Service consular office, subject to the examination by all 
persons interested therein (22 U.S.C. 1197).



Sec. 22.5  Remittances to Foreign Service posts.

    Remittances to Foreign Service posts from persons in the United 
States in payment of offical fees and charges or for the purpose of 
establishing deposits in advance of rendition of services shall be in a 
form acceptable to the post, drawn payable to the American Embassy (name 
of city), American Consulate General (name of city) or American 
Consulate (name of city), as the case may be. This will permit cashing 
of negotiable instruments for deposit in the Treasury when not 
negotiated locally. See Sec. 23.2 of this chapter.
    (a) Time at which fees become payable. Fees are due and payble prior 
to issue or delivery to the interested party of a

[[Page 127]]

signed document, a copy of a record, or other paper representative of a 
service performed.
    (b) Receipt for fees; register of services. Every officer of the 
Foreign Service responsible for the performance of services as 
enumerated in the Schedule of Fees for Consular Services, Department of 
State and Foreign Service (Sec. 22.1), shall give receipts for fees 
collected for the official services rendered, specifying the nature of 
the service and numbered to correspond with entries in a register 
maintained for the purpose (22 U.S.C. 1192, 1193, and 1194). The 
register serves as a record of official acts performed by officers of 
the Foreign Service in a governmental or notarial capacity, 
corresponding in this regard with the record which notaries are usually 
expected or required to keep of their official acts. See Sec. 92.2 of 
this chapter.
    (c) Deposits to guarantee payment of fees or incidental costs. When 
the amount of any fee is determinable only after initiation of the 
performance of a service, or if incidental costs are involved, the total 
fee and incidental costs shall be carefully estimated and an advance 
deposit required, subject to refund of any unused balance to the person 
making the deposit.



Sec. 22.6  Refund of fees.

    (a) Fees which have been collected for deposit in the Treasury are 
refundable:
    (1) As specifically authorized by law (See 22 U.S.C. 214a concerning 
passport fees erroneously charged persons excused from payment, 22 
U.S.C. 216 concerning passport fees in cases where the appropriate 
representative in the United States of a foreign government refuses a 
visa and 46 U.S.C. 8 concerning fees improperly imposed on vessels or 
seamen);
    (2) When the principal officer at the consular post where the fee 
was collected (or the officer in charge of the consular section at a 
combined diplomatic/consular post) finds upon review of the facts that 
the collection was erroneous under applicable law; and
    (3) Where determination is made by the Department of State with a 
view to payment of a refunded in the United States in cases which it is 
impracticable to have the facts reviewed and refunded effected by and at 
the direction of the responsible consular office.
    See Sec. 13.1 of this chapter concerning refunds of fees improperly 
exacted by consular officers who have neglected to return the same.
    (b) Refunds of $5.00 or less will not be paid to the remitter unless 
a claim is specifically filed at the time of payment for the excess 
amount. An automatic refund on overpayments due to misinformation or 
mistakes on the part of the Department of State will be made.
[52 FR 29515, Aug. 10, 1987]



Sec. 22.7  Collection and return of fees.

    No fees other than those prescribed in the Schedule of Fees, 
Sec. 22.1, or by or pursuant to an act of Congress, shall be charged or 
collected by officers of the Foreign Service for official services 
performed abroad (22 U.S.C. 1201). All fees received by any officer of 
the Foreign Service for services rendered in connection with the duties 
of office or as a consular officer shall be accounted for and paid into 
the Treasury of the United States (22 U.S.C. 99 and 812). For receipt, 
registry, and numbering provisions, see Sec. 22.5(b). Collections for 
transportation and other expenses necessary for performance of services 
or for Interested Party toll telephone calls shall be refunded to post 
allotment accounts and made available for meeting such expenses.



PART 23--FINANCE AND ACCOUNTING--Table of Contents




Sec.
23.1  Remittances made payable to the Department of State.
23.2  Endorsing remittances for deposit in the Treasury.
23.3  Refunds.
23.4  Representative value in exchange.
23.5  Claims for settlement by Department of State or General Accounting 
          Office.

    Authority:  Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658.

    Source:  22 FR 10793, Dec. 27, 1957, unless otherwise noted.

[[Page 128]]



Sec. 23.1  Remittances made payable to the Department of State.

    Except as otherwise specified in this title, remittances of moneys 
shall be drawn payable to the Department of State and sent to the 
Department for action and deposit. (See Secs. 21.2, 22.2, and 51.40 of 
this chapter.)



Sec. 23.2  Endorsing remittances for deposit in the Treasury.

    The Office of Finance--Cashier Unit, the Authentication Office, the 
Passport Office or Passport Agency, American Embassy, American Legation, 
American consular office, or other office or unit of the Department of 
State authorized and required to deposit funds in the Treasury of the 
United States, is hereby authorized to endorse, or to have endorsed, to 
the order of the Treasurer of the United States by appropriate stamp, 
checks, drafts, money orders, or other forms of remittance, regardless 
of how drawn, which are for payment to the Department of State for 
deposit in the Treasury of the United States, including those payable to 
the Secretary of State.



Sec. 23.3  Refunds.

    (a) Rectifications and readjustments. See Sec. 22.4 of this chapter 
for outline of circumstances under which fees which have been collected 
for deposit in the Treasury may be refunded.
    (b) Refund of wrongful exactions. See Sec. 13.1 of this chapter 
concerning recovery from consular officers of amounts wrongfully exacted 
and withheld by them.



Sec. 23.4  Representative value in exchange.

    Representative value in exchange for the collection of a fee means 
foreign currency equivalent to the prescribed United States dollar fee 
at the current rate of exchange at the time and place of payment of the 
fee. ``Current rate'' of exchange for this purpose means the bank 
selling rate at which the foreign bank will sell the number of United 
States dollars required to liquidate the obligation to the United States 
for the Foreign Service fee.



Sec. 23.5  Claims for settlement by Department of State or General Accounting Office.

    Claims for settlement by the Department of State or by the General 
Accounting Office shall be submitted to the Department in duplicate over 
the handwritten signature, together with the post office address of the 
claimant, and with appropriate recommendations of the officer of the 
Foreign Service, for items such as:
    (a) Refunds of amounts representing payroll deductions such as for 
any retirement and disability fund;
    (b) Amounts due deceased, incompetent, or insolvent persons 
including payees or bona fide holders of unpaid Government checks;
    (c) Amounts claimed from the Government when questions of fact 
affect either the amount payable or the terms of payment, when for any 
reason settlement cannot or should not be affected at the Foreign 
Service office; and
    (d) Amounts of checks, owned by living payees or bona fide holders, 
which have been covered into outstanding liabilities. The Foreign 
Service post or the Department of State shall be consulted before 
preparing the claim to ascertain whether any special form is required to 
be used. Claims for unpaid compensation of deceased alien employees 
shall be forwarded to the respective Foreign Service post.

[[Page 129]]



                SUBCHAPTER D--CLAIMS AND STOLEN PROPERTY





PART 32--STOLEN PROPERTY UNDER TREATY WITH MEXICO--Table of Contents




Sec.
32.1  Mexican motor vehicles, trailers, airplanes, etc., in the United 
          States.
32.2  American motor vehicles, trailers, airplanes, etc., in Mexico.

    Authority:  Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658.



Sec. 32.1  Mexican motor vehicles, trailers, airplanes, etc., in the United States.

    Whenever, in accordance with the provisions of Article I of the 
convention \1\ (50 Stat. 1334), the United Mexican States shall request 
the detention in the United States of America of alleged stolen or 
embezzled motor vehicles, trailers, airplanes, or the component parts of 
any of them, the request shall be accompanied by documents legally valid 
in the United Mexican States. The said documents shall be as follows: 
(a) The original or a certified copy of the sales or conditional sales 
contract and where registration of title is required by law the 
certificate of such registration of title; (b) the original or a 
certified copy of the official registration card; (c) not more than 
three affidavits identifying the claimant as the owner of the legal or 
equitable title, or both, to the property alleged to have been stolen or 
embezzled; (d) the original or a certified copy of any assignment of the 
property by the insured to the insurer pursuant to a contract of 
insurance in force at the time the theft or embezzlement was committed.
---------------------------------------------------------------------------


    \1\ Convention of October 6, 1936 between the United States and 
Mexico for the recovery and return of stolen or embezzled motor 
vehicles, etc.
---------------------------------------------------------------------------

[22 FR 10795, Dec. 27, 1957]



Sec. 32.2  American motor vehicles, trailers, airplanes, etc., in Mexico.

    Whenever, in accordance with the provisions of Article II of the 
convention (50 Stat. 1334), the United States of America shall request 
the detention in the United Mexican States of alleged stolen or 
embezzled motor vehicles, trailers, airplanes, or the component parts of 
any of them, the request shall be accompanied by documents legally valid 
in the United States of America. The said documents shall be as follows: 
(a) The original or a certified copy of the sales or conditional sales 
contract and where registration of title is required by law the 
certificate of such registration of title; (b) the original or a 
certified copy of the official registration card; (c) not more than 
three affidavits identifying the claimant as the owner of the legal or 
equitable title, or both, to the property alleged to have been stolen or 
embezzled; (d) the original or a certified copy of any assignment of the 
property by the insured to the insurer pursuant to a contract of 
insurance in force at the time the theft or embezzlement was committed.
[22 FR 10795, Dec. 27, 1957]



PART 33--FISHERMEN'S PROTECTIVE ACT GUARANTY FUND PROCEDURES UNDER SECTION 7--Table of Contents




Sec.
33.1  Purpose.
33.2  Definitions.
33.3  Eligibility.
33.4  Applications.
33.5  Guaranty agreement.
33.6  Fees.
33.7  Conditions for claims.
33.8  Claim procedures.
33.9  Amount of award.
33.10  Payments.
33.11  Records.
33.12  Penalties.

    Authority:  22 U.S.C. 1977.

    Source:  61 FR 49967, Sept. 24, 1996, unless otherwise noted.



Sec. 33.1  Purpose.

    These rules clarify procedures for the administration of Section 7 
of the Fishermen's Protective Act of 1967. Section 7 of the Act 
establishes a Fishermen's Guaranty Fund to reimburse owners and 
charterers of United States commercial fishing vessels for certain 
losses and costs caused by the seizure and detention of their vessels by 
foreign countries under certain claims to

[[Page 130]]

jurisdiction not recognized by the United States.



Sec. 33.2  Definitions.

    For the purpose of this part, the following terms mean:
    Act. The Fishermen's Protective Act of 1967 (22 U.S.C. 1971 et 
seq.).
    Capital equipment. Equipment or other property which may be 
depreciated for income tax purposes.
    Depreciated replacement costs. The present replacement cost of 
capital equipment after being depreciated on a straight line basis over 
the equipment's depreciable life, which is standardized at ten years.
    Downtime. The time a vessel normally would be in port or transiting 
to and from the fishing grounds.
    Expendable items. Any property, excluding that which may be 
depreciated for income tax purposes, which is maintained in inventory or 
expensed for tax purposes.
    Fund. The Fishermen's Guaranty Fund established in the U.S. Treasury 
under section 7(c) of the Act (22 U.S.C. 1977(c)).
    Market value. The price property would command in a market, at the 
time of property loss, assuming a seller willing to sell and buyer 
willing to buy.
    Other direct charge. Any levy which is imposed in addition to, or in 
lieu of any fine, license fee, registration fee, or other charge.
    Owner. The owner or charterer of a commercial fishing vessel.
    Secretary. The Secretary of State or the designee of the Secretary 
of State.
    Seizure. Arrest of a fishing vessel by a foreign country for 
allegedly illegal fishing.
    U.S. fishing vessel. Any private vessel documented or certified 
under the laws of the United States as a commercial fishing vessel.



Sec. 33.3  Eligibility.

    Any owner or charterer of a U.S. fishing vessel is eligible to apply 
for an agreement with the Secretary providing for a guarantee in 
accordance with section 7 of the Act.



Sec. 33.4  Applications.

    (a) Applicant. An eligible applicant for a guaranty agreement must:
    (1) Own or charter a U.S. fishing vessel; and
    (2) Submit with his application the fee specified in Sec. 33.6 
below.
    (b) Applicaton forms. Application forms may be obtained by 
contacting the Office of Marine Conservation, Bureau of Oceans and 
International Environmental and Scientific Affairs, Room 7820, U.S. 
Department of State, Washington, DC 20520-7818; Telephone 202-647-3941.
    (c) Where to apply. Applications must be submitted to the Director, 
Office of marine Conservation, Bureau of Oceans and International 
Environmental and Scientific Affairs, Room 7820, U.S. Department of 
State, Washington, DC 20520-7818.
    (d) Applicaton approval. Application approval will be by execution 
of the guaranty agreement by the Secretary or by the Secretary's 
designee.



Sec. 33.5  Guaranty agreements.

    (a) Period in effect. Agreements are effective for a Fiscal Year 
beginning October 1 and ending on the next September 30. Applications 
submitted after October 1 are effective from the date the application 
and fee are mailed (determined by the postmark) through September 30.
    (b) Guaranty agreement transfer. A guaranty agreement may, with the 
Secretary's prior consent, be transferred when a vessel which is the 
subject of a guaranty agreement is transferred to a new owner if the 
transfer occurs during the agreement period.
    (c) Guaranty agreement renewal. A guaranty agreement may be renewed 
for the next agreement year by submitting an application form with the 
appropriate fee for the next year in accordance with the Secretary's 
annually published requirements regarding fees. Renewals are subject to 
the Secretary's approval.
    (d) Provisions of the agreement. The agreement will provide for 
reimbursement for certain losses caused by foreign countries' seizure 
and detention of U.S. fishing vessels on the basis of claims to 
jurisdiction which are not recognized by the United States. Recent 
amendments to the Magnuson Fishery Conservation and Management Act (16 
U.S.C. (1801 et seq.) assert U.S.

[[Page 131]]

jurisdiction over highly migratory species of tuna in the U.S. exclusive 
economic zone (EEZ). Accordingly, as a matter of international law, the 
United States now recognizes other coastal states' claims to 
jurisdiction over tuna in their EEZ'S. This change directly affect 
certification of claims filed under the Fishermen's Protective Act. 
Participants are advised that this means that the Department will no 
longer certify for payment claims resulting from the seizure of a U.S. 
vessel while such vessel was fishing for tuna within the exclusive 
economic zone of another country in violation of that country's laws. 
Claims for detentions or seizures based on other claims to jurisdiction 
not recognized by the United States, or on the basis of claims to 
jurisdiction recognized by the United States but exercised in a manner 
inconsistent with international law as recognized by the United states, 
may still be certified by the Department.



Sec. 33.6  Fees.

    (a) General. Fees provide for administrative costs and payment of 
claims. Fees are set annually on the basis of past and anticipated claim 
experience. The annual agreement year for which fees are payable starts 
on October 1 and ends on September 30 of the following year.
    (b) Amount and payment. The amount of each annual fee or adjusted 
fee will be established by the Office Director of the Office of Marine 
Conservation, Bureau of Oceans and International Environmental and 
Scientific Affairs, by publication of a notice in the Federal Register. 
Each notice will establish the amount of the fee, when the fee is due, 
when the fee is payable, and any special conditions surrounding 
extension of prior agreements or execution of new agreements. Unless 
otherwise specified in such notices, agreement coverage will commence 
with the postmarked date of the fee payment and application.
    (c) Adjustment and refund. Fees may be adjusted at any time to 
reflect actual seizure and detention experience for which claims are 
anticipated. Failure to submit adjusted fees will result in agreement 
termination as of the date the adjusted fee is payable. No fees will be 
refunded after an agreement is executed by the Secretary.
    (d) Disposition. All fees will be deposited in the Fishermen's 
Guaranty Fund. They will remain available without fiscal year limitation 
to carry out section 7 of the Act. Claims will be paid from fees and 
from appropriated funds, if any. Fees not required to pay administrative 
costs or claims may be invested in U.S. obligations. All earnings will 
be credited to the Fishermen's Guaranty Fund.



Sec. 33.7  Conditions for claims.

    (a) Unless there is clear and convincing credible evidence that the 
seizure did not meet the requirements of the Act, payment of claims will 
be made when:
    (1) A covered vessel is seized by a foreign country under conditions 
specified in the Act and the guaranty agreement; and
    (2) The incident occurred during the period the guaranty agreement 
was in force for the vessel involved.
    (b) Payments will be made to the owner for:
    (1) All actual costs (except those covered by section 3 of the Act 
or reimbursable from some other source) incurred by the owner during the 
seizure or detention period as a direct result thereof, including:
    (i) Damage to, or destruction of, the vessel or its equipment; or
    (ii) Loss or confiscation of the vessel or its equipment; and
    (iii) Dockage fees or utilities;
    (2) The market value of fish or shellfish caught before seizure of 
the vessel and confiscated or spoiled during the period of detention; 
and
    (3) Up to 50 percent of the vessel's gross income lost as a direct 
result of the seizure and detention.
    (c) The exceptions are that no payment will be made from the Fund 
for a seizure which is:
    (1) Covered by any other provision of law (for example, fines, 
license fees, registration fees, or other direct charges payable under 
section 3 of the Act);
    (2) Made by a country at war with the United States;
    (3) In accordance with any applicable convention or treaty, if that 
treaty or

[[Page 132]]

convention was made with the advice and consent of the Senate and was in 
force and effect for the United States and the seizing country at the 
time of the seizure;
    (4) Which occurs before the guaranty agreement's effective date or 
after its termination;
    (5) For which other sources of alternative reimbursement have not 
first been fully pursued (for example, the insurance coverage required 
by the agreement and valid claims under any law);
    (6) For which material requirements of the guaranty agreement, the 
Act, or the program regulations have not been fully fulfilled; or
    (7) In the view of the Department of State occurred because the 
seized vessel was undermining or diminishing the effectiveness of 
international conservation and management measures recognized by the 
United States, or otherwise contributing to stock conservation problems 
pending the establishment of such measures.



Sec. 33.8  Claim procedures.

    (a) Where and when to apply. Claims must be submitted to the Office 
Director, Office of Marine Conservation, Bureau of Oceans and 
International Environmental and Scientific Affairs, Room 7820, U.S. 
Department of State, Washington, DC 20520-7818. Claims must be submitted 
within ninety (90) days after the vessel's release. Requests for 
extension of the filing deadline must be in writing and approved by the 
Office Director, Office of Marine Conservation, Bureau of Oceans and 
International Environmental and Scientific Affairs.
    (b) Contents of claim. All material allegations of a claim must be 
supported by documentary evidence. Foreign language documents must be 
accompanied by an authenticated English translation. Claims must 
include:
    (1) The captain's sworn statement about the exact location and 
activity of the vessel when seized;
    (2) Certified copies of charges, hearings, and findings by the 
government seizing the vessel;
    (3) A detailed computation of all actual costs directly resulting 
from the seizure and detention, supported by receipts, affidavits, or 
other documentation acceptable to the Office Director, Office of Marine 
Conservation, Bureau of Oceans and International Environmental and 
Scientific Affairs;
    (4) A detailed computation of lost income claimed, including:
    (i) The date and time seized and released;
    (ii) The number of miles and running time from the point of seizure 
to the point of detention;
    (iii) The total fishing time lost (explain in detail if lost fishing 
time claimed is any greater than the elapsed time from seizure to the 
time required after release to return to the point of seizure);
    (iv) The tonnage of catch on board at the time of seizure;
    (v) The vessel's average catch-per-day's fishing for the three 
calendar years preceding the seizure;
    (vi) The vessel's average downtime between fishing trips for the 
three calendar years preceding the seizure; and
    (vii) The price-per-pound for the catch on the first day the vessel 
returns to port after the seizure and detention unless there is a pre-
negotiated price-per-pound with a processor, in which case the pre-
negotiated price must be documented; and
    (5) Documentation for confiscated, damaged, destroyed, or stolen 
equipment, including:
    (i) The date and cost of acquisition supported by invoices or other 
acceptable proof of ownership; and
    (ii) An estimate from a commercial source of the replacement or 
repair cost.
    (c) Burden of proof. The claimant has the burden of proving all 
aspects of the claim, except in cases of dispute over the facts of the 
seizure where the claimant shall have the presumption that the seizure 
was eligible unless there is clear and convincing credible evidence that 
the seizure did not meet the eligibility standards of the Act.



Sec. 33.9  Amount of award.

    (a) Lost fishing time. Compensation is limited to 50 percent of the 
gross income lost as a direct result of the seizure and detention, based 
on the value of the average catch-per-day's fishing during the three 
most recent calendar

[[Page 133]]

years immediately preceding the seizure as determined by the Secretary, 
based on catch rates on comparable vessels in comparable fisheries. The 
compensable period for cases of seizure and detention not resulting in 
vessels confiscation is limited to the elapsed time from seizure to the 
time after release when the vessel could reasonably be expected to 
return to the point of seizure. The compensable period in cases where 
the vessel is confiscated is limited to the elapsed time from seizure 
through the date of confiscation, plus an additional period to purchase 
a replacement vessel and return to the point of seizure. In no case can 
the additional period exceed 120 days.
    (1) Compensation for confiscation of vessels, where no buy-back has 
occurred, will be based on market value which will be determined by 
averaging estimates of market value obtained from as many vessel 
surveyors or brokers as the Secretary deems practicable;
    (2) Compensation for capital equipment other than vessel, will be 
based on depreciated replacement cost;
    (3) Compensation for expendable items and crew's belongings will be 
50 percent of their replacement costs; and
    (4) Compensation for confiscated catch will be for full value, based 
on the price-per-pound.
    (b) Fuel expense. Compensation for fuel expenses will be based on 
the purchase price, the time required to run to and from the fishing 
grounds, the detention time in port, and the documented fuel consumption 
of the vessel.
    (c) Stolen or confiscated property. If the claimant was required to 
buy back confiscated property from the foreign country, the claimant may 
apply for reimbursement of such charges under section 3 of the Act. Any 
other property confiscated is reimbursable from this Guaranty Fund. 
Confiscated property is divided into the following categories:
    (1) Compensation for confiscation of vessels, where no buy-back has 
occurred, will be based on market value which will be determined by 
averaging estimates of market value obtained from as many vessel 
surveyors or brokers as the Secretary deems practicable;
    (2) Compensation for capital equipment other than a vessel, will be 
based on depreciated replacement cost;
    (3) Compensation for expendable items and crew's belongings will be 
50 percent of their replacement cost; and
    (4) Compensation for confiscated catch will be for full value, based 
on the price-per-pound.
    (d) Insurance proceeds. No payments will be made from the Fund for 
losses covered by any policy of insurance or other provisions of law.
    (f) Appeals. All determinations under this section are final and are 
not subject to arbitration or appeal.



Sec. 33.10  Payments.

    The Office Director, Office of Marine Conservation, Bureau of Oceans 
and International Environmental and Scientific Affairs, will pay the 
claimant the amount calculated under Sec. 33.9. Payment will be made as 
promptly as practicable, but may be delayed pending the appropriation of 
sufficient funds, should fee collections not be adequate to sustain the 
operation of the Fund. The Director shall notify the claimant of the 
amount approved for payment as promptly as practicable and the same 
shall thereafter constitute a valid, but non-interest bearing obligation 
of the Government. Delays in payments are not a direct consequence of 
seizure and detention and cannot therefore be construed as increasing 
the compensable period for lost fishing time. If there is a question 
about distribution of the proceeds of the claim, the Director may 
request proof of interest from all parties, and will settle this issue.



Sec. 33.11  Records.

    The Office Director, Office of Marine Conservation, Bureau of Oceans 
and International Environmental and Scientific Affairs will have the 
right to inspect claimants' books and records as a precondition to 
approving claims. All claims must contain written authorization of the 
guaranteed party for any international, federal, state, or local 
governmental Agencies to provide the Office Director, Office of Marine 
Conservation, Bureau of Oceans and International Environmental and 
Scientific

[[Page 134]]

Affairs any data or information pertinent to a claim.



Sec. 33.12  Penalties.

    Persons who willfully make any false or misleading statement or 
representation to obtain compensation from the Fund are subject to 
criminal prosecution under 22 U.S.C. 1980(g). This provides penalties up 
to $25,000 or imprisonment for up to one year, or both. Any evidence of 
criminal conduct will be promptly forwarded to the United States 
Department of Justice for action. Additionally, misrepresentation, 
concealment, or fraud, or acts intentionally designed to result in 
seizure, may void the guaranty agreement.



PART 34--COLLECTION OF DEBTS--Table of Contents




                      Subpart A--General Provisions

Sec.
34.1  Purpose.
34.2  Scope.
34.3  Definitions.
34.4  Interest, penalty, and administrative charges.
34.5  Exceptions.
34.6  Use of procedures.
34.7  Other procedures or actions.

  Subpart B--Administrative Offset and Referral to Collection Agencies

34.8  Demand for payment.
34.9  Collection by administrative offset.
34.10  Administrative offset against amounts payable for Civil Service 
          Retirement and Disability Fund.
34.11  Collection in installments.
34.12  Exploration of compromise.
34.13  Suspending or terminating collection action.
34.14  Referrals to the Department of Justice or the General Accounting 
          Office.
34.15  Collection services.

                        Subpart C--Salary Offset

34.16  Scope.
34.17  Coordinating offset with another federal agency.
34.18  Notice requirements before offset.
34.19  Request for a hearing.
34.20  Hearings.
34.21  Review of STATE records related to the debt.
34.22  Written agreement to repay as alternative to salary offset.
34.23  Procedures for salary offset.
34.24  Non-waiver of rights by payments.
34.25  Refunds.

    Authority:  31 U.S.C. 3701-3719; 5 U.S.C. 5514; 22 U.S.C. 2658; 22 
U.S.C. 3926; 4 CFR parts 101-105; 5 CFR part 550

    Source:  54 FR 13365, Apr. 3, 1989, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 34.1  Purpose.

    These regulations prescribe the procedures to be used by the United 
States Department of State (STATE) in the collection of claims owed to 
STATE and to the United States.



Sec. 34.2  Scope.

    (a) Applicability of Federal Claims Collection Standards (FCCS). 
Except as set forth in this part or otherwise provided by law, STATE 
will conduct administrative actions to collect claims (including offset, 
compromise, suspension, termination, disclosure and referral) in 
accordance with the FCCS of the General Accounting Office and Department 
of Justice, 4 CFR parts 101-105.
    (b) This part is not applicable to:
    (1) Claims against any foreign country or any political subdivision 
thereof, or any public international organization.
    (2) Claims where the STATE Comptroller or his designee determines 
that the achievement of the purposes of any provision of law 
administered by STATE require a different course of action.



Sec. 34.3  Definitions.

    (a) A debt or claim refers to an amount of money which has been 
determined to be owed to the United States from any person, organization 
or entity, except another Federal Agency. A debtor's liability arising 
from a particular contract or transaction shall be considered a single 
claim for purposes of the monetary ceilings of the FCCS.
    (b) Delinquent means a debt that has not been paid by the date 
specified in STATE's written notification or applicable contractual 
agreement, unless other satisfactory arrangements have been made by that 
date, or that has not been in accordance with a payment agreement with 
STATE.

[[Page 135]]

    (c) Disposable pay means the amount that remains from an employee's 
Federal pay after required deductions for Federal, State and local 
income taxes; Social Security taxes, including Medicare taxes; Federal 
retirement programs; premiums for life and health insurance benefits and 
such other deductions that are required by law to be withheld including 
garnishments.



Sec. 34.4  Interest, penalty, and administrative charges.

    (a) Except as otherwise provided by statute, contract or excluded in 
accordance with FCCS, STATE will assess:
    (1) Interest on unpaid claims in accordance with existing Treasury 
rules and regulations.
    (2) Penalty charges at 6 percent a year on any portion of a claim 
that is delinquent for more than 90 days.
    (3) Administrative charges to cover the costs of processing and 
calculating delinquent claims.
    (4) Late payment charges shall be computed from the date of mailing 
or hand delivery of the notice of the claim and interest requirements.
    (5) When a debt is paid in partial or installment payments, amounts 
received shall be applied first to outstanding penalty and 
administrative cost charges, second to accrued interest, and then to 
outstanding principal.
    (6) Waiver. STATE shall consider waiver of interest, penalty charges 
and/or administrative charges in accordance with the FCCS, 4 CFR 
102.13(g).



Sec. 34.5  Exceptions.

    (a) Claims arising from the audit of transportation accounts 
pursuant to 31 U.S.C. 3726 shall be determined, collected, compromised, 
terminated, or settled in accordance with the regulations published 
under 31 U.S.C. 3726 (see 41 CFR part 101-41).
    (b) Claims arising out of acquisition contracts subject to the 
Federal Acquisition Regulation (FAR) shall be determined, collected, 
compromised, terminated, or settled in accordance with those regulations 
(see 48 CFR part 32).
    (c) Claims based in whole or in part on conduct in violation of the 
antitrust laws, or in regard to which there is an indication of fraud, 
presentation of a false claim, or misrepresentation on the part of the 
debtor or any other party having an interest in the claim, shall be 
referred to the Department of Justice for compromise, suspension, or 
termination of collection action.
    (d) Tax claims are excluded from the coverage of this regulation.



Sec. 34.6  Use of procedures.

    Procedures authorized by this regulation (including but not limited 
to referral to a debt collection agency, administrative offset, or 
salary offset) may be used singly or in combination.



Sec. 34.7  Other procedures or actions.

    (a) Nothing contained in this regulation is intended to require 
STATE to duplicate administrative proceedings required by contract or 
other laws or regulations.
    (b) Nothing in this regulation is intended to preclude utilization 
of informal administrative actions or remedies which may be available.
    (c) Nothing contained in this regulation is intended to deter STATE 
from demanding the return of specific property or from demanding the 
return of the property or the payment of its value.
    (d) The failure of STATE to comply with any provision in this 
regulation shall not serve as defense to the debt.



  Subpart B--Administrative Offset and Referral to Collection Agencies



Sec. 34.8  Demand for payment.

    (a) A total of three progressively stronger written demands at 
approximately 30-day intervals will normally be made, unless a response 
or other information indicates that additional written demands would 
either be unnecessary or futile. When necessary to protect the 
Government's interest, written demand may be preceded by other 
appropriate actions under the FCCS, including immediate referral for 
litigation and/or offset.
    (b) The initial written demand for payment shall inform the debtor 
of:
    (1) The basis of the claim;
    (2) The amount of the claim;
    (3) The date when payment is due 30-days from the date of mailing or 
hand

[[Page 136]]

delivery of the initial demand for payment;
    (4) The provision for late payment (interest), penalty and 
administrative charges, if payment is not received by the due date.



Sec. 34.9  Collection by administrative offset.

    (a) Offset will be used whenever feasible and not otherwise 
prohibited. Offset is not required to be used in every instance and 
consideration should be given to the debtor's financial condition and 
the impact of offset on STATE programs or projects.
    (b) The procedures for offset in this section do not apply to the 
offset of Federal salaries under 5 U.S.C. 5514.
    (c) Before offset is made, STATE will provide the debtor with 
written notice informing the debtor of:
    (1) The nature and amount of the claim;
    (2) The intent of STATE to collect by administrative offset, 
including asking the assistance of other Federal agencies to help in the 
offset whenever possible, if the debtor has not made payment by the 
payment due date or has not made an arrangement for payment by the 
payment due date;
    (3) The right of the debtor to inspect and copy STATE's records of 
the claim;
    (4) The right of the debtor to a review of the claim within STATE. 
If the claim is disputed in full or part, the debtor shall respond to 
the demand in writing by making a request by the payment due date stated 
within the notice to the billing office for a review of the claim within 
STATE. The debtor's written response shall state the basis for the 
dispute. If only part of the claim is disputed, the undisputed portion 
must be paid by the date stated in the notice to avoid late payment, 
penalty and administrative charges. If STATE either sustains or amends 
its determination, it shall notify the debtor of its intent to collect 
the claim, with any adjustments based on the debtor's response by 
administrative offset unless payment is received within 30-days of the 
mailing of the notification of its decision following a review of the 
claim.
    (5) The right of the debtor to offer to make a written agreement to 
repay the amount of the claim.
    (6) The notice of offset need not include the requirements of 
paragraphs (c) (3), (4), or (5) of this section if the debtor has been 
informed of the requirements at an earlier stage in the administrative 
proceedings, e.g., if they were included in a final contracting 
officer's decision.
    (d) STATE will promptly make requests for offset to other agencies 
known to be holding funds payable to a debtor and, when appropriate, 
place the name of the debtor on the ``List of Contractors Indebted to 
the United States''. STATE will provide instructions for the transfer of 
funds.
    (e) STATE will promptly process requests for offset from other 
agencies and transfer funds to the requesting agency upon receipt of the 
written certification that the person owes the debt and that, if a 
Federal employee, the employee has been given the procedural rights 
required by 5 USC 5514 and 5 CFR part 550, subpart K.



Sec. 34.10  Administrative offset against amounts payable for Civil Service Retirement and Disability Fund.

    (a) Unless otherwise prohibited by law, STATE may request that 
monies that are due and payable to a debtor from the Civil Service 
Retirement and Disability Fund, Federal Employee Retirement Fund, or the 
Foreign Service Retirement Fund be administratively offset in reasonable 
amounts in order to collect in one full payment or a minimal number of 
payments, debts owed the United States by the debtor. Such requests 
shall be made to the appropriate officials of the respective fund 
servicing agency in accordance with such regulations as may be 
prescribed by the Director of that agency.
    (b) When making a request for administrative offset under paragraph 
(a) of this section, STATE shall include written statements that:
    (1) The debtor owes the United States a debt, including the amount 
of the debt.
    (2) STATE has complied with the applicable statutes, regulations, 
and procedures of the respective fund servicing agencies.

[[Page 137]]

    (3) STATE has complied with the requirements of Sec. 34.9 of this 
part.
    (c) Once STATE decides to request offset under paragraph (a) of this 
section, it will make the request as soon as practical after completion 
of the applicable procedures in order that the fund servicing agency may 
identify the debtor's account in anticipation of the time when the 
debtor requests or becomes eligible to receive payments from the fund. 
This will satisfy any requirements that offset will be initiated prior 
to expiration of the applicable statute of limitations.
    (d) If STATE collects part or all of the debt by other means before 
deductions are made or completed pursuant to paragraph (a) of this 
section, STATE shall act promptly to modify or terminate its request for 
offset under paragraph (a) of this section.
    (e) This section does not require or authorize the fund servicing 
agency to review the merits of the STATE determination relative to the 
amount and validity of the debt, its determination on waiver under an 
applicable statute, or its determination whether to provide an oral 
hearing.



Sec. 34.11  Collection in installments.

    Whenever feasible, and except as required otherwise by law, debts 
owed to the United States, together with interest, penalties, and 
administrative costs as required by this regulation, should be collected 
in one lump sum. This is true whether the debt is being collected under 
administrative offset or by another method, including voluntary payment. 
However, if the debtor is financially unable to pay the indebtedness in 
one lump sum, payment may be accepted in regular installments. If STATE 
agrees to accept payment in installments, it will obtain a legally 
enforceable written agreement from the debtor that specifies all of the 
terms of the arrangement and which contains a provision accelerating the 
debt in the event the debtor defaults. The size and frequency of the 
payments should bear a reasonable relation to the size of the debt and 
ability of the debtor to pay. If possible the installment payments 
should be sufficient in size and frequency to liquidate the Government's 
claim within 3 years.



Sec. 34.12  Exploration of compromise.

    STATE may attempt to effect compromise in accordance with the 
standards set forth in part 103 of the FCCS (4 CFR part 103).



Sec. 34.13  Suspending or terminating collection action.

    The suspension or termination of collection action shall be made in 
accordance with the standards set forth in part 104 of the FCCS (4 CFR 
part 104).



Sec. 34.14  Referrals to the Department of Justice or the General Accounting Office.

    Referrals to the Department of Justice or the General Accounting 
Office shall be made in accordance with the standards set forth in part 
105 of the FCCS (4 CFR part 105).



Sec. 34.15  Collection services.

    (a) STATE has authority to contract for collection services to 
recover delinquent debts in accordance with 31 U.S.C. 3718(c) and part 
102 of the FCCS (4 CFR part 102).
    (b) STATE may disclose delinquent debts, other than delinquent debts 
of current Federal employees, to consumer reporting agencies in 
accordance with 31 U.S.C. 3711(f) and the FCCS.
    (c) STATE will not use a collection agency to collect a debt owed by 
a currently employed or retired Federal employee, if collection by 
salary or annuity offset is available.



                        Subpart C--Salary Offset



Sec. 34.16  Scope.

    (a) This subpart sets forth STATE's procedures for the collection of 
a Federal employee's pay by salary offset to satisfy certain valid and 
past due debts owed the United States Government.
    (b) This subpart applies to:
    (1) Current employees of STATE and other agencies who owe debts to 
STATE;
    (2) Current employees of STATE who owe debts to other agencies.
    (c) This subpart does not apply to debts or claims arising under the 
Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.); the Social Security 
Act (42 U.S.C. 301 et seq.); the tariff laws of the United

[[Page 138]]

States; or to any case where collection of a debt by salary offset is 
explicitly provided for or prohibited by another statute (e.g. travel 
advances in 5 U.S.C. 5705 and employee training expenses in 5 U.S.C. 
4108).
    (d) This subpart does not apply to any adjustment to pay arising out 
of an employee's election of coverage or a change in coverage under a 
Federal benefits program requiring periodic deductions from pay or 
ministerial adjustments in pay, if the amount to be recovered was 
accumulated over four pay periods or less.
    (e) These regulations do not preclude an employee from:
    (1) Requesting waiver of erroneous payment of salary, travel, 
transportation or relocation expense and allowances;
    (2) Requesting waiver of any other type of debt, if waiver is 
available by statute; or
    (3) Questioning the amount or validity of a debt by submitting a 
subsequent claim to the General Accounting Office.
    (f) Nothing in these regulations precludes the compromise, 
suspension or termination of collection actions where appropriate under 
subpart A or other regulations.



Sec. 34.17  Coordinating offset with another federal agency.

    (a) When STATE is owed a debt by an employee of another agency, the 
other agency shall not initiate the requested offset until STATE 
provides the agency with a written certification that the debtor owes 
STATE a debt (including the amount and basis of the debt and the due 
date of payment) and that STATE has complied with these regulations.
    (b) When another agency is owed the debt, STATE may use salary 
offset against one of its employees who is indebted to another agency, 
if requested to do so by that agency. Such request must be accompanied 
by a certification that the person owes the debt (including the amount 
and basis of the debt and the due date of payment) and that the agency 
has complied with its regulations as required by 5 U.S.C. 5514 and 5 CFR 
part 550, subpart K.



Sec. 34.18  Notice requirements before offset.

    Except as provided in Sec. 34.16, salary offset deductions will not 
be made unless STATE first provides the employee with a written notice 
that he/she owes a debt to the Federal Government at least 30 calendar 
days before salary offset is to be initiated. When STATE is the creditor 
agency, this notice of intent to offset an employee's salary shall be 
hand-delivered or sent by certified mail to the most current address 
that is available to the Department and will state:
    (a) That STATE has reviewed the records relating to the debt and has 
determined that the debt is owed, its origin and nature, and the amount 
due;
    (b) The intention of STATE to collect the debt by means of deduction 
from the employee's current disposable pay until the debt and all 
accumulated interest are paid in full;
    (c) The amount, frequency, approximate beginning date, and duration 
of the intended deductions;
    (d) The requirement to assess and collect interest, penalties, and 
administrative costs, or waiver are in accordance with Sec. 34.4, unless 
excused in accordance with Sec. 34.4(a)(6);
    (e) The employee's right to inspect and copy any STATE records 
relating to the debt, or, if the employee or their representative cannot 
personally inspect the records, to request and receive a copy of such 
records;
    (f) The opportunity (under terms agreeable to STATE) to enter into a 
written agreement establishing a repayment schedule of the debt in lieu 
of offset;
    (g) The right to a hearing conducted by an official (administrative 
law judge or a hearing official not under the control of STATE) with 
respect to the existence of the debt, the amount of the debt, or the 
repayment schedule (i.e. the percentage of disposable pay to be deducted 
each pay period), so long as a request for a hearing is filed by the 
employee as prescribed in Sec. 34.19;
    (h) That the timely filing of a request for hearing within 30 
calendar days after receipt of the notice of intent to offset will stay 
the commencement of collection proceedings;

[[Page 139]]

    (i) That the Department will initiate procedures to implement a 
salary offset, as appropriate, (which may not exceed 15 percent of the 
employee's disposable pay) not less than thirty (30) days from the date 
of receipt of the notice of debt, unless the employee files a timely 
petition for a hearing;
    (j) That a final decision on the hearing (if one is requested) will 
be issued at the earliest practical date, but not later than 60 days 
after the filing of the request for a hearing unless the employee 
requests and the hearing official grants a delay in the proceedings;
    (k) That any knowingly false or frivolous statements, 
representation, or evidence may subject the employee to disciplinary 
procedures (5 U.S.C. Chapter 75, 5 CFR part 752 or other applicable 
statutes or regulations); penalties (31 U.S.C. 3729-3731 or other 
applicable statutes or regulations); or criminal penalties (18 U.S.C. 
286, 287, 1001, and 1002 or other applicable statutes or regulations);
    (l) Any other rights and remedies available to the employee under 
statutes or regulations governing the program for which the collection 
is being made;
    (m) That the amounts paid on or deducted from the debt which are 
later waived or found not owed to the United States will be promptly 
refunded to the employee, unless there are applicable contractual or 
statutory provisions to the contrary;
    (n) The method and time period for requesting a hearing; and
    (o) The name and address of the STATE official to whom 
communications should be directed.
[54 FR 13365, Apr. 3, 1989; 54 FR 28416, July 16, 1989]



Sec. 34.19  Request for a hearing.

    (a) Except as provided in paragraph (c) of this section, an employee 
must file a request for a hearing that is received by STATE not later 
than 30 calendar days from the date of STATE's notice described in 
Sec. 34.18 if an employee wants a hearing concerning:
    (1) The existence or amount of the debt; or
    (2) STATE's proposed offset schedule.
    (b) The request must be signed by the employee and should identify 
and explain with reasonable specificity and brevity the facts, evidence 
and witnesses which the employee believes support his or her position. 
If the employee objects to the percentage of disposable pay to be 
deducted from each check, the request should state the objection and the 
reasons for it.
    (c) The employee must also specify whether an oral or paper hearing 
is requested. If an oral hearing is desired, the request should explain 
why the matter cannot be resolved by review of the documentary evidence 
alone.
    (d) If the employee files a request for hearing later than the 
required 30 calendar days as described in paragraph (a) of this section, 
the hearing officer may accept the request if the employee can show that 
the delay was because of circumstances beyond his or her control or 
because of failure to receive notice of the filing deadline (unless the 
employee has actual notice of the filing deadline).
    (e) An employee waives the right to a hearing and will have his or 
her disposable pay offset if the employee fails to file a petition for a 
hearing as prescribed in paragraph (a) of this section or fails to 
appear at the scheduled hearing.



Sec. 34.20  Hearings.

    (a) If an employee timely files a request for a hearing under 
Sec. 34.19, STATE shall select the time, date, and location of the 
hearing.
    (b) Hearings shall be conducted by a hearing official not under the 
control or authority of STATE.
    (c) Procedure.
    (1) After the employee requests a hearing, the hearing official or 
administrative law judge shall notify the employee of the form of the 
hearing to be provided. If the hearing will be oral, notice shall set 
forth the date, time and location of the hearing. If the hearing will be 
paper, the employee shall be notified that he or she should submit 
arguments in writing to the hearing official or administrative law judge 
by a specified date after which the record shall be closed. This date 
shall give the employee reasonable time to submit documentation.

[[Page 140]]

    (2) Oral hearing. An employee who requests an oral hearing shall be 
provided an oral hearing if the hearing official or administrative law 
judge determines that the matter cannot be resolved by review of 
documentary evidence alone (e.g. when an issue of credibility or 
veracity is involved). The hearing is not an adversarial adjudication, 
and need not take the form of an evidentiary hearing. Oral hearings may 
take the form of, but are not limited to:
    (i) Informal conferences with the hearing official or administrative 
law judge, in which the employee and agency representative will be given 
full opportunity to present evidence, witnesses, and argument;
    (ii) Informal meetings with an interview of the employee; or
    (iii) Formal written submissions, with an opportunity for oral 
presentation.
    (3) Paper hearing. If the hearing official or administrative law 
judge determines that an oral hearing is not necessary, he or she will 
make the determination based upon a review of the available written 
record (5 U.S.C. 5514).
    (4) Record. The hearing official must maintain a summary record of 
any hearing  provided  by  this  subpart.  See 4 CFR 102.3. Witnesses 
who testify in oral hearings will do so under oath or affirmation.
    (5) Content of decision. The written decision shall include:
    (i) A statement of the facts presented to support the origin, 
nature, and amount of the debt;
    (ii) The hearing official's findings, analysis, and conclusions; and
    (iii) The terms of any repayment schedules, if applicable.
    (6) Failure to appear. In the absence of good cause shown (e.g. 
excused illness), an employee who fails to appear at a hearing shall be 
deemed, for the purpose of this subpart, to admit the existence and 
amount of the debt as described in the notice of intent. The hearing 
official shall schedule a new hearing date upon the request of the 
creditor agency representative when good cause is shown. Both parties 
shall be given reasonable notice of the time and place of the new 
hearing.
[54 FR 13365, Apr. 3, 1989; 54 FR 28416, July 16, 1989]



Sec. 34.21  Review of STATE records related to the debt.

    (a) Notification by employee. An employee who intends to inspect or 
copy agency records related to the debt must send a letter to the 
official designated in Sec. 34.18(o) stating his or her intention. The 
letter must be received by STATE within 30 calendar days after receipt 
of the notice of intent to offset.
    (b) STATE's response. In response to a timely notice submitted by 
the debtor as described in paragraph (a) of this section, STATE will 
notify the employee of the location and time when the employee may 
inspect and copy STATE records related to the debt.



Sec. 34.22  Written agreement to repay as alternative to salary offset.

    (a) Notification by employee. The employee may propose, in response 
to the notice of intent to offset, a written agreement to repay the debt 
as an alternative to salary offset. The proposal shall admit the 
existence of the debt and set forth a proposed repayment schedule. Any 
employee who wishes to do this must submit a proposed written agreement 
to repay the debt which is received by STATE within 30 calendar days of 
the notice.
    (b) STATE's response. STATE will notify the employee whether the 
proposed written agreement for repayment is acceptable. It is within 
STATE's discretion to accept a repayment agreement instead of proceeding 
by offset.
    (c) Procedures. If the employee and STATE enter into a written 
agreement to repay instead of salary offset, the debt will be repaid in 
accordance with the agreement provisions and the procedures of 
Sec. 34.23 will not apply.



Sec. 34.23  Procedures for salary offset.

    Unless STATE agrees and regulations do not provide otherwise, the 
following procedures apply:
    (a) Method. Salary offset will be made by deduction at one or more 
officially

[[Page 141]]

established pay intervals from the current pay account of the employee 
without his or her consent.
    (b) Source. The source of salary offset is current disposable pay 
which is that part of current basic pay, special pay, retainer pay, or 
in the case of an employee not entitled to pay, other authorized pay 
remaining after the deduction of any amount required by law to be 
withheld.
    (c) Types of collection--(1) Lump sum payment. Ordinarily debts will 
be collected by salary offset in one lump sum if possible. However, if 
the employee is financially unable to pay in one lump sum or the amount 
of the debt exceeds 15 percent of disposable pay for an officially 
established pay interval, the collection by salary offset must be made 
in installment deductions.
    (2) Installment deductions. (i) The size of installment deductions 
must bear a reasonable relation to the size of the debt and the 
employee's ability to pay. If possible the size of the deduction will be 
that necessary to liquidate the debt in no more than 1 year. However, 
the amount deducted for any period must not exceed 15 percent of the 
disposable pay from which the deduction is made, except as provided by 
other regulations or unless the employee has agreed in writing to a 
greater amount.
    (ii) Installment payments of less than $25 per pay period will be 
accepted only in the most unusual circumstances.
    (iii) Installment deductions will be made over a period of not 
greater than the anticipated period of employment.
    (d) When deductions may begin. (1) Salary offset will begin on the 
date stated in the notice as provided in Sec. 34.18, unless a hearing is 
requested.
    (2) If there has been a timely request for a hearing, salary offset 
will begin as of the date stated in the written decision.
    (e) Additional offset provisions--(1) Liquidation from final check. 
If employment ends before salary offset is completed, the remaining debt 
will be liquidated by offset from payment of any nature due the employee 
from STATE (e.g. final salary payment, lump-sum leave, etc.).
    (2) Offset from other payments. If the debt cannot be liquidated by 
offset from any final check, the remaining debt will be liquidated by 
offset from later payments of any kind due the former employee from the 
United States, inclusive of retirement or disability funds pursuant to 
Sec. 34.10 of this regulation.



Sec. 34.24  Non-waiver of rights by payments.

    So long as there are no statutory or contractual provision to the 
contrary, no employee payment (of all or a portion of a debt) collected 
under this subpart will be interpreted as a waiver of any rights that 
the employee may have under 5 U.S.C. 5514.



Sec. 34.25  Refunds.

    (a) STATE will refund promptly to the appropriate individual amounts 
offset under this regulation when:
    (1) A debt is waived or otherwise found not owing the United States 
(unless expressly prohibited by statute or regulation); or
    (2) STATE is directed by an administrative or judicial order to make 
a refund.
    (b) Refunds do not bear interest unless required or permitted by law 
or contract.



PART 35--PROGRAM FRAUD CIVIL REMEDIES--Table of Contents




Sec.
35.1  General.
35.2  Definitions.
35.3  Basis for civil penalties and assessments.
35.4  Investigation.
35.5  Review by the reviewing official.
35.6  Prerequisites for issuing a complaint.
35.7  Complaint.
35.8  Service of complaint.
35.9  Answer.
35.10  Default upon failure to file an answer.
35.11  Referral of complaint and answer to the ALJ.
35.12  Notice of hearing.
35.13  Parties to the hearing.
35.14  Separation of functions.
35.15  Ex parte contacts.
35.16  Disqualification of reviewing official or ALJ.
35.17  Rights of parties.
35.18  Authority of the ALJ.
35.19  Prehearing conferences.
35.20  Disclosure of documents.
35.21  Discovery.
35.22  Exchange of witness lists, statements

[[Page 142]]

          and exhibits.
35.23  Subpoenas for attendance at hearing.
35.24  Protective order.
35.25  Fees.
35.26  Form, filing and service of papers.
35.27  Computation of time.
35.28  Motions.
35.29  Sanctions.
35.30  The hearing and burden of proof.
35.31  Determining the amount of penalties and assessments.
35.32  Location of hearing.
35.33  Witnesses.
35.34  Evidence.
35.35  The record.
35.36  Post-hearing briefs.
35.37  Initial decision.
35.38  Reconsideration of initial decision.
35.39  Appeal to authority head.
35.40  Stays ordered by the Department of Justice.
35.41  Stay pending appeal.
35.42  Judicial review.
35.43  Collection of civil penalties and assessments.
35.44  Right to administrative offset.
35.45  Deposit in Treasury of United States.
35.46  Compromise or settlement.
35.47  Limitations.

    Authority:  31 U.S.C. 3801-3812.

    Source:  55 FR 23424, June 8, 1990, unless otherwise noted.



Sec. 35.1  General.

    (a) Basis. This part implements the Program Fraud Civil Remedies Act 
of 1986, Public Law 99-509, sections. 6101-6104, 100 Stat. 1874 (October 
21, 1986), codified at 31 U.S.C. 3801-3812. 31 U.S.C. 3809 of the 
statute requires each authority head to promulgate regulations necessary 
to implement the provisions of the statute.
    (b) Purpose. This part establishes administrative procedures for 
imposing civil penalties and assessments against persons who make, 
submit, or present, or cause to be made, submitted, or presented, false 
fictitious, or fraudulent claims or written statements to authorities or 
to their agents; and specifies the hearing and appeal rights of persons 
subject to allegations of liability for such penalties and assessments.
    (c) Special considerations abroad. Where a party, witness or 
material evidence in a proceeding under these regulations is located 
abroad, the investigating official, reviewing official or ALJ, as the 
case may be, may adjust the provisions below for service, filing of 
documents, time limitations, and related matters to meet special 
problems arising out of that location.



Sec. 35.2  Definitions.

    (a) ALJ means an Administrative Law Judge in the authority appointed 
pursuant to 5 U.S.C. 3105 or detailed to the authority pursuant to 5 
U.S.C. 3344.
    (b) Authority means the United States Department of State.
    (c) Authority head means the Under Secretary for Management.
    (d) Benefit means, in the context of ``statement,'' anything of 
value, including but not limited to, any advantage, preference, 
privilege, license, permit, favorable decision, ruling, status, or loan 
gurarantee.
    (e) Claim means any request, demand, or submission--
    (1) Made to the authority for property, services, or money 
(including money representing grants, loans, insurance, or benefits);
    (2) Made to a recipient of property, services, or money from the 
authority or to a party to a contract with the authority--
    (i) For property or services if the United States--
    (A) Provided such property or services;
    (B) Provided any portion of the funds for the purchase of such 
property or services; or
    (C) Will reimburse such recipient or party for the purchase of such 
property or services; or
    (ii) For the payment of money (including money representing grants, 
loans, insurance or benefits) if the United States--
    (A) Provided any portion of the money requested or demanded; or
    (B) Will reimburse such recipient or party for any portion of the 
money paid on such request or demand; or
    (3) Made to the authority which has the effect of decreasing an 
obligation to pay or account for property, services or money.
    (f) Complaint means the administrative complaint served by the 
reviewing official on the defendant under Sec. 35.7.
    (g) Defendant means any person alleged in a complaint under 
Sec. 35.7 to be liable for a civil penalty or assessment under 
Sec. 35.3.

[[Page 143]]

    (h) Department means the Department of State.
    (i) Government means the United States Government.
    (j) Individual means a natural person.
    (k) Initial decision means the written decision of the ALJ required 
by Sec. 35.10 or Sec. 35.37, and includes a revised initial decision 
issued following a remand or a motion for reconsideration.
    (l) Investigating official means the Inspector General of the 
Department of State or an officer or employee of the Office of Inspector 
General designated by the Inspector General and serving in a position 
for which the rate of basic pay is not less than the minimum rate of 
basic pay for grade GS-16 under the General Schedule.
    (m) Knows or has reason to know means that a person, with respect to 
a claim or statement--
    (1) Has actual knowledge that the claim or statement is false, 
fictitious, or fraudulent;
    (2) Acts in deliberate ignorance of the truth or falsity of the 
claim or statement; or
    (3) Acts in reckless disregard of the truth or falsity of the claim 
or statement.
    (n) Makes, wherever it appears, shall include the terms presents, 
submits, and causes to be made, presented, or submitted. As the context 
requires, making or made, shall likewise include the corresponding forms 
of such terms.
    (o) Person means any individual, partnership, corporation, 
association or private organization, and includes the plural of the 
term.
    (p) Representative means an attorney who is a member in good 
standing of the bar of any state, territory, or possession of the United 
States, or of the District of Columbia, or the Commonwealth of Puerto 
Rico.
    (q) Representative for the Authority means the Counsel to the 
Inspector General.
    (r) Reviewing official means the chief Financial Officer of the 
Department or her or his designee who is--
    (1) Not subject to supervision by, or required to report to, the 
investigating official;
    (2) Not employed in the organizational unit of the authority in 
which the investigating official is employed; and
    (3) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16 under the 
General Schedule.
    (s) Statement means any representation, certification, affirmation, 
document, record, or accounting or bookkeeping entry made--
    (1) With respect to a claim or to obtain the approval or payment of 
a claim (including relating to eligibility to make a claim); or
    (2) With respect to (including relating to eligibility for)--
    (i) A contract with, or a bid or proposal for a contract with; or
    (ii) A grant, loan or benefit from, the authority, or any state, 
political subdivision of a state, or other party, if the United States 
Government provides any portion of the money or property under such 
contract or for such grant, loan, or benefit, or if the Government will 
reimburse such state, political subdivision, or party for any portion of 
the money or property under such contract or for such grant, loan, or 
benefit.



Sec. 35.3  Basis for civil penalties and assessments.

    (a) Claims. (1) Except as provided in paragraph (c) of this section, 
any person who makes a claim that the person knows or has reason to know 
the following shall be subject, in addition to any other remedy that may 
be prescribed by law, to a civil penalty of not more than $5,000 for 
each such claim:
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which asserts 
a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that--
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and
    (C) Is a statement in which the person making the statement has a 
duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed.

[[Page 144]]

    (2) Each voucher, invoice, claim form, or other individual request 
or demand for property, services, or money constitutes a separate claim.
    (3) A claim shall be considered made to the authority, recipient, or 
party when such claim is actually made to an agent, fiscal intermediary, 
or other entity, including any state or political subdivision thereof, 
acting for or on behalf of the authority, recipient, or party.
    (4) Each claim for property, services, or money is subject to a 
civil penalty regardless of whether such property, services, or money is 
actually delivered or paid.
    (5) If the Government has made any payment (including transferred 
property or provided services) on a claim, a person subject to a civil 
penalty under paragraph (a)(1) of this section shall also be subject to 
an assessment of not more than twice the amount of such claim or that 
portion thereof that is determined to be in violation of paragraph 
(a)(1) of this section. Such assessment shall be in lieu of damages 
sustained by the Government because of such claim.
    (b) Statements. (1) Except as provided in paragraph (c) of this 
section, any person who makes a written statement that--
    (i) The person knows or has reason to know--
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a mateial 
fact that the person making the statment has a duty to include in such 
statement; and
    (ii) Contains or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the contents of the 
statement, shall be subject, in addition to any other remedy that may be 
prescribed by law, to a civil penalty of not more than $5,000 for each 
such statement.
    (2) Each written representation, certification, or affirmation 
constitutes a separate statement.
    (3) A statement shall be considered made to the authority when such 
statement is actually made to an agent, fiscal intermediary, or other 
entity, including any state or political subdivision thereof, acting for 
or on behalf of the authority.
    (c) No proof of specific intent to defraud is required to establish 
liability under this section.
    (d) In any case in which it is determined that more than one person 
is liable for making a claim or statement under this section, each such 
person may be held liable for a civil penalty under this section.
    (e) In any case in which it is determined that more than one person 
is liable for making a claim under this section on which the Government 
has made payment (including transferred property or provided services), 
an assessment may be imposed against any such person or jointly and 
severally against any combination of such persons.



Sec. 35.4  Investigation.

    (a) If an investigating official concludes that a subpoena pursuant 
to the authority conferred by 31 U.S.C. 3804(a) is warranted--
    (1) The subpoena so issued shall notify the person to whom it is 
addressed of the authority under which the subpoena is issued (and, in 
the case of a subpoena to be served outside the jurisdiction of the 
United States, the basis for such service), and shall identify the 
records or documents sought;
    (2) The investigating official may designate a person to act on his 
or her behalf to receive the documents sought; and
    (3) The person receiving such subpoena shall be required to tender 
to the investigating official or the person designated to receive the 
documents a certification that the documents sought have been produced, 
or that such documents are not available and the reasons therefore, or 
that such documents, suitably identified, have been withheld based upon 
the assertion of an identified privilege.
    (b) If the investigating official concludes that an action under the 
Program Fraud Civil Remedies Act may be warranted, the investigating 
official shall submit a report containing the findings and conclusions 
of such investigation to the reviewing official.

[[Page 145]]

    (c) Nothing in this section shall preclude or limit an investigating 
official's discretion to refer allegations directly to the Department of 
Justice for suit under the False Claims Act or other civil relief, or to 
preclude or limit such official's discretion to defer or postpone a 
report or referral to the reviewing official to avoid interference with 
a criminal investigation or prosecution.
    (d) Nothing in this section modifies any responsibility of an 
investigating official to report violations of criminal law to the 
Attorney General.



Sec. 35.5  Review by the reviewing official.

    (a) If, based on the report of the investigating official under 
Sec. 35.4(b), the reviewing official determines that there is adequate 
evidence to believe that a person is liable under Sec. 35.3 of this 
part, the reviewing official shall transmit to the Attorney General a 
written notice of the reviewing official's intention to issue a 
complaint under Sec. 35.7.
    (b) Such notice shall include--
    (1) A statement of the reviewing official's reasons for issuing a 
complaint;
    (2) A statement specifying the evidence that supports the 
allegations of liability;
    (3) A description of the claims or statements upon which the 
allegations of liability are based;
    (4) An estimate of the amount of money or the value of property, 
services, or other benefits requested or demanded in violation of 
Sec. 35.3;
    (5) A statement of any exculpatory or mitigating circumstances that 
may relate to the claims or statements known by the reviewing official 
or the investigating official; and
    (6) A statement that there is a reasonable prospect of collecting an 
appropriate amount of penalties and assessments.



Sec. 35.6  Prerequisites for issuing a complaint.

    (a) The reviewing official may issue a complaint under Sec. 35.7 
only if--
    (1) The Department of Justice approves the issuance of a complaint 
in a written statement described in 31 U.S.C. 3803(b)(1); and
    (2) In the case of allegations of liability under Sec. 35.3(a) with 
respect to a claim, the reviewing official determines that, with respect 
to such claim or a group of related claims submitted at the same time 
such claim is submitted (as defined in paragraph (b) of this section), 
the amount of money or the value of property or services demanded or 
requested in violation of Sec. 35.3(a) does not exceed $150,000.
    (b) For purposes of this section, a related group of claims 
submitted at the same time shall include only those claims arising from 
the same transaction (e.g., grant, loan, application, or contract) that 
are submitted simultaneously as part of a single request, demand or 
submission.
    (c) Nothing in this section shall be construed to limit the 
reviewing official's authority to join in a single complaint against a 
person's claims that are unrelated or were not submitted simultaneously, 
regardless of the amount of money, or the value of property or services, 
demanded or requested.



Sec. 35.7  Complaint.

    (a) On or after the date the Department of Justice approves the 
issuance of a complaint in accordance with 31 U.S.C. 3803(b)(1), the 
reviewing official may serve a complaint on the defendant, as provided 
in Sec. 35.8.
    (b) The complaint shall state--
    (1) The allegations of liability against the defendant, including 
the statutory basis for liability, an identification of the claims or 
statements that are the basis for the alleged liability, and the reasons 
why liability allegedly arises from such claims or statements;
    (2) The maximum amount of penalties and assessments for which the 
defendant may be held liable;
    (3) Instructions for filing an answer to request a hearing, 
including a specific statement of the defendant's right to request a 
hearing by filing an answer and to be represented by a representative; 
and
    (4) That failure to file an answer within 30 days of service of the 
complaint will result in the imposition of the maximum amount of 
penalties and

[[Page 146]]

assessments without right to appeal, as provided in Sec. 35.10.
    (c) At the same time the reviewing official serves the complaint, he 
or she shall serve the defendant with a copy of these regulations.



Sec. 35.8  Service of complaint.

    (a) Service of a complaint must be made by certified or registered 
mail or by delivery in any manner authorized by Rule 4(d) of the Federal 
Rules of Civil Procedure. Service is complete upon receipt.
    (b) Proof of service, stating the name and address of the person on 
whom the complaint was served, and the manner and date of service, may 
be made by--
    (1) Affidavit of the individual serving the complaint by delivery;
    (2) A United States Postal Service return receipt card acknowledging 
receipt;
    (3) Written acknowledgment of receipt by the defendant or his or her 
representative; or
    (4) In case of service abroad authenticated in accordance with the 
Convention on the Service Abroad of Judicial and Extra Judicial 
Documents in Civil or Commercial Matters.



Sec. 35.9  Answer.

    (a) The defendant may request a hearing by filing an answer with the 
reviewing official within 30 days of service of the complaint. An answer 
shall be deemed to be a request for hearing.
    (b) In the answer, the defendant--
    (1) Shall admit or deny each of the allegations of liability made in 
the complaint;
    (2) Shall state any defense on which the defendant intends to rely;
    (3) May state any reasons why the defendant contends that the 
penalties and assessments should be less than the statutory maximum; and
    (4) Shall state the name, address and telephone number of the person 
authorized by the defendant to act as defendant's representative, if 
any.
    (c) If the defendant is unable to file an answer meeting the 
requirements of paragraph (b) of this section within the time provided, 
the defendant may, before the expiration of 30 days from service of the 
complaint, file with the reviewing official a general answer denying 
liability and requesting a hearing, and a request for an extension of 
time within which to file an answer meeting the requirements of 
paragraph (b) of this section. The reviewing official shall file 
promptly with the ALJ the complaint, the general answer denying 
liability, and the request for an extension of time as provided in 
Sec. 35.10. For good cause shown, the ALJ may grant the defendant up to 
30 additional days within which to file an answer meeting the 
requirements of paragraph (b) of this section.



Sec. 35.10  Default upon failure to file an answer.

    (a) If the defendant does not file an answer within the time 
prescribed in Sec. 35.9(a), the reviewing official may refer the 
complaint to the ALJ.
    (b) Upon the referral of the complaint, the ALJ shall promptly serve 
on defendant in the manner prescribed in Sec. 35.8, a notice that an 
initial decision will be issued under this section.
    (c) If the defendant fails to answer, the ALJ shall assume the facts 
alleged in the complaint to be true, and, if such facts established 
liability under Sec. 35.3, the ALJ shall issue an initial decision 
imposing the maximum amount of penalties and assessments allowed under 
the statute.
    (d) Except as otherwise provided in this section, by failing to file 
a timely answer, the defendant waives any right to further review of the 
penalties and assessments imposed under paragraph (c) of this section, 
and the initial decision shall become final and binding upon the parties 
30 days after it was issued.
    (e) If, before such an initial decision becomes final, the defendant 
files a motion with the ALJ seeking to reopen on the grounds that 
extraordinary circumstances prevented the defendant from filing an 
answer, the initial decision shall be stayed pending the ALJ's decision 
on the motion.
    (f) If, on such motion, the defendant can demonstrate extraordinary 
circumstances excusing the failure to file a timely answer, the ALJ 
shall withdraw the initial decision in paragraph (c) of this section, if 
such a decision

[[Page 147]]

has been issued, and shall grant the defendant an opportunity to answer 
the complaint.
    (g) A decision of the ALJ denying a defendant's motion under 
paragraph (e) of this section is not subject to reconsideration under 
Sec. 35.38.
    (h) The defendant may appeal to the authority head the decision 
denying a motion to reopen by filing a notice of appeal with the 
authority head within 15 days after the ALJ denies the motion. The 
timely filing of a notice of appeal shall stay the initial decision 
until the authority head decides the issue.
    (i) If the defendant files a timely notice of appeal with the 
authority head, the ALJ shall forward the record of the proceeding to 
the authority head.
    (j) The authority head shall decide expeditiously whether 
extraordinary circumstances excuse the defendant's failure to file a 
timely answer based solely on the record before the ALJ.
    (k) If the authority head decides that extraordinary circumstances 
excused the defendant's failure to file a timely answer, the authority 
head shall remand the case to the ALJ with instructions to grant the 
defendant an opportunity to answer.
    (l) If the authority head decides that the defendant's failure to 
file a timely answer is not excused, the authority head shall reinstate 
the initial decision of the ALJ, which shall become final and binding 
upon the parties 30 days after the authority head issues such decision.



Sec. 35.11  Referral of complaint and answer to the ALJ.

    Upon receipt of an answer, the reviewing official shall file the 
complaint and answer with the ALJ.



Sec. 35.12  Notice of hearing.

    (a) When the ALJ receives the complaint and answer, the ALJ shall 
promptly serve a notice of hearing upon the defendant in the manner 
prescribed by Sec. 35.8. At the same time, the ALJ shall send a copy of 
such notice to the representative for the Authority.
    (b) Such notice shall include--
    (1) The tentative time and place, and the nature of the hearing;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The matters of fact and law to be asserted;
    (4) A description of the procedures for the conduct of the hearing;
    (5) The name, address, and telephone number of the representative of 
the Government and of the defendant, if any; and
    (6) Such other matters as the ALJ deems appropriate.



Sec. 35.13  Parties to the hearing.

    (a) The parties to the hearing shall be the defendant and the 
Authority.
    (b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the 
False Claims Act may participate in these proceedings to the extent 
authorized by the provisions of that Act.



Sec. 35.14  Separation of functions.

    (a) The investigating official, the reviewing official, and any 
employee or agent of the authority who takes part in investigating, 
preparing, or presenting a particular case may not, in such case or a 
factually related case--
    (1) Participate in the hearing as the ALJ;
    (2) Participate or advise in the initial decision or the review of 
the initial decision by the authority head, except as a witness or a 
representative in public proceedings; or
    (3) Make the collection of penalties and assessments under 31 U.S.C. 
3806.
    (b) The ALJ shall not be responsible to, or subject to the 
supervision or direction of the investigating official or the reviewing 
official.
    (c) Except as provided in paragraph (a) of this section, the 
representative for the Government may be employed anywhere in the 
authority, including in the offices of either the investigating official 
or the reviewing official.



Sec. 35.15  Ex parte contacts.

    No party or person (except employees of the ALJ's office) shall 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking

[[Page 148]]

routine questions concerning administrative functions or procedures.



Sec. 35.16  Disqualification of reviewing official or ALJ.

    (a) A reviewing official or ALJ in a particular case may disqualify 
herself or himself at any time.
    (b) A party may file with the ALJ a motion for disqualification of a 
reviewing official or an ALJ. Such motion shall be accompanied by an 
affidavit alleging personal bias or other reason for disqualification.
    (c) Such motion and affidavit shall be filed promptly upon the 
party's discovery of reasons requiring disqualification, or such objects 
shall be deemed waived
    (d) Such affidavit shall state specific facts that support the 
party's belief that personal bias or other reason for disqualification 
exists and the time and circumstances of the party's discovery of such 
facts. It shall be accompanied by a certificate of the representative of 
record that it is made in good faith.
    (e) Upon the filing of such a motion and affidavit, the ALJ shall 
proceed no further in the case until he or she resolves the matter of 
disq ualification in accordance with paragraph (f) of this section.
    (f) If the ALJ--
    (1) Determines that a reviewing official is disqualified, the ALJ 
shall dismiss the complaint without prejudice;
    (2) Disqualifies himself or herself, the case shall be reassigned 
promptly to another ALJ; or
    (3) Denies a motion to disqualify, the authority head may determine 
the mater only as part of his or her review of the initial decision upon 
appeal, if any.



Sec. 35.17  Rights of parties.

    Except as otherwise limited by this part, all parties may--
    (a) Be accompanied, represented, and advised by a representative;
    (b) Participate in any conference held by the ALJ;
    (c) Conduct discovery;
    (d) Agree to stipulations of fact or law, which shall be made part 
of the record;
    (e) Present evidence relevant to the issues at the hearing;
    (f) Present and cross-examine witnesses;
    (g) Present oreal arguments at the hearing as permitted by the ALJ; 
and
    (h) Submit written briefs and proposed findings of fact and 
conclusions of law after the hearing.



Sec. 35.18  Authority of the ALJ.

    (a) The ALJ shall conduct a fair and impartial hearing, avoid delay, 
maintain order, and assure that a record of the proceeding is made.
    (b) The ALJ has the authority to--
    (1) Set and change the date, time, and place of the hearing upon 
reasonable notice to the parties;
    (2) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (3) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (4) Administer oaths and affirmations;
    (5) Issue subpoenas to be served within the United States requiring 
the attendance of witnesses and the production of documents at 
depositions or at hearings. Subpoenas to be served outside the 
jurisdiction of the United States shall state on their face the 
authority therefore;
    (6) Rule on motions and other procedural matters;
    (7) Regulate the scope and timing of discovery;
    (8) Regulate the course of the hearing and the conduct of 
representatives and parties;
    (9) Examine witnesses;
    (10) Receive, rule on, exclude, or limit evidence;
    (11) Upon motion of a party, take official notice of facts;
    (12) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment where there is no disputed issue of material fact;
    (13) Conduct any conference, argument, or hearing on motions in 
person or by telephone; and
    (14) Exercise such other authority as is necessary to carry out the 
responsibilities of the ALJ under this part.

[[Page 149]]

    (c) The ALJ does not have the authority to find treaties and other 
international agreements or federal statutes or regulations invalid.



Sec. 35.19  Prehearing conferences.

    (a) The ALJ may schedule prehearing conferences as appropriate.
    (b) Upon the motion of any party, the ALJ shall schedule at least 
one prehearing conference at a reasonable time in advance of the 
hearing.
    (c) The ALJ may use prehearing conferences to discuss the following:
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations and admissions of fact or as to the contents and 
authenticity of documents;
    (4) Whether the parties can agree to submission of the case on a 
stipulated record;
    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument;
    (6) Limitation of the number of witnesses;
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (8) Discovery;
    (9) The time and place for the hearing; and
    (10) Such other matters as may tend to expedite the fair and just 
disposition of the proceedings.
    (d) The ALJ may issue an order containing all matters agreed upon by 
the parties or ordered by the ALJ at a prehearing conference.



Sec. 35.20  Disclosure of documents.

    (a) Upon written request to the reviewing official, the defendant 
may review any relevant and material documents, transcripts, records, 
and other materials that relate to the allegations set out in the 
complaint and upon which the findings and conclusions of the 
investigating official under Sec. 35.4(b) are based, unless such 
materials are subject to a privilege under federal law or classified 
pursuant to Executive Order. Upon payment of fees for duplication, the 
defendant may obtain copies of such documents.
    (b) Upon written request to the reviewing official, the defendant 
also may obtain a copy of all exculpatory information in the possession 
of the reviewing official or investigating official relating to the 
allegations in the complaint, even if it is contained in a document that 
would otherwise be privileged. If the document would otherwise be 
privileged, only that portion containing exculpatory information must be 
disclosed.
    (c) The notice sent to the Attorney General from the reviewing 
official as described in Sec. 35.5 is not discoverable under any 
circumstances.
    (d) The defendant may file a motion to compel disclosure of the 
documents subject to the provisions of this section. Such a motion may 
only be filed with the ALJ following the filing of an answer pursuant to 
Sec. 35.9.



Sec. 35.21  Discovery.

    (a) The following types of discovery are authorized:
    (1) Requests for production of documents for inspection and copying;
    (2) Requests for admissions of the authenticity of any relevant 
document or of the truth of any relevant fact;
    (3) Written interrogatories; and
    (4) Depositions.
    (b) For the purpose of this section and Secs. 35.22 and 35.23, the 
term ``documents'' includes information, documents, reports, answers, 
records, accounts, papers, and other data and documentary evidence. 
Nothing contained herein shall be interpreted to require the creation of 
a document.
    (c) Unless mutually agreed to by the parties, discovery is available 
only as ordered by the ALJ. The ALJ shall regulate the timing of 
discovery.
    (d) Motions for discovery. (1) A party seeking discovery may file a 
motion with the ALJ. Such a motion shall be accompanied by a copy of the 
requested discovery, or in the case of depositions, a summary of the 
scope of the proposed deposition.
    (2) Within ten days of service, a party may file an opposition to 
the motion and/or a motion for protective order as provided in 
Sec. 35.24.

[[Page 150]]

    (3) The ALJ may grant a motion for discovery only if he finds that 
the discovery sought--
    (i) Is necessary for the expeditious, fair, and reasonable 
consideration of the issues;
    (ii) Is not unduly costly or burdensome;
    (iii) Will not unduly delay the proceeding; and
    (iv) Does not seek privileged or classified information.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.
    (5) The ALJ may grant discovery subject to a protective order under 
Sec. 35.24.
    (e) Depositions. (1) If a motion for deposition is granted, the ALJ 
shall issue a subpoena for the deponent, which may require the deponent 
to produce documents. The subpoena shall specify the time and place at 
which the deposition will be held.
    (2) The party seeking to depose shall serve the subpoena in the 
manner prescribed in Sec. 35.8.
    (3) The deponent may file with the ALJ a motion to quash the 
subpoena or a motion for a protective order within ten days of service.
    (4) The party seeking to depose shall provide for the taking of a 
verbatim transcript of the deposition, which it shall make available to 
all other parties for inspection and copying.
    (f) Each party shall bear its own costs of discovery.



Sec. 35.22  Exchange of witness lists, statements and exhibits.

    (a) At least 15 days before the hearing or at such other time as may 
be ordered by the ALJ, the parties shall exchange witness lists, copies 
of prior statements of proposed witnesses, and copies of proposed 
hearing exhibits, including copies of any written statements that the 
party intends to offer in lieu of live testimony in accordance with 
Sec. 35.33(b). At the time the above documents are exchanged, any party 
that intends to rely on the transcript of deposition testimony in lieu 
of live testimony at the hearing, if permitted by the ALJ, shall provide 
each party with a copy of the specific pages of the transcript it 
intends to introduce into evidence.
    (b) If a party objects, the ALJ shall not admit into evidence the 
testimony of any witness whose name does not appear on the witness list 
or any exhibit not provided to the opposing party as provided above 
unless the ALJ finds good cause for the failure or that there is no 
prejudice to the objecting party.
    (c) Unless another party objects within the time set by the ALJ, 
documents exchanged in accordance with paragraph (a) of this section 
shall be deemed to be authentic for the purpose of admissibility at the 
hearing.



Sec. 35.23  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may request that the ALJ issue a subpoena.
    (b) A subpoena requiring the attendance and testimony of an 
individual may also require the individual to produce documents at the 
hearing.
    (c) A party seeking a subpoena shall file a written request therefor 
not less than 15 days before the day fixed for the hearing unless 
otherwise allowed by the ALJ for good cause shown. Such request shall 
specify any documents to be produced and shall designate the witnesses 
and describe the address and location thereof with sufficient 
particularity to permit such witnesses to be found.
    (d) The subpoena shall specify the time and place at which the 
witness is to appear and any documents the witness is to produce.
    (e) The party seeking the subpoena shall serve it in the manner 
prescribed in Sec. 35.8. A subpoena on a party or upon an individual 
under the control of a party may be served within the United States by 
first class mail.
    (f) A party or the individual to whom the subpoena is directed may 
file with the ALJ a motion to quash the subpoena within ten days after 
service or on or before the time specified in the subpoena for 
compliance if it is less than ten days after service.



Sec. 35.24  Protective order.

    (a) A party or a prospective witness or deponent may file a motion 
for a protective order with respect to discovery sought by an opposing 
party or

[[Page 151]]

with respect to the hearing, seeking to limit the availability or 
disclosure of evidence.
    (b) In issuing a protective order, the ALJ may make any order which 
justice requires to protect a party or person from annoyance, 
embarrassment, oppression, or undue burden or expense, including one or 
more of the following:
    (1) That the discovery not be had;
    (2) That the discovery may be had only on specified terms and 
conditions, including a designation of the time or place;
    (3) That the discovery may be had only through a method of discovery 
other than that requested;
    (4) That certain matters not be inquired into, or that the scope of 
discovery be limited to certain matters;
    (5) That discovery be conducted with no one present except persons 
designated by the ALJ;
    (6) That the contents of discovery or evidence be sealed;
    (7) That a deposition after being sealed be opened only by order of 
the ALJ;
    (8) That a trade secret or other confidential research, development, 
commercial information, classified material, or facts pertaining to any 
criminal investigation, proceeding, or other administrative 
investigation not be disclosed or be disclosed only in a designated way; 
or
    (9) That the parties simultaneously file specified documents or 
information enclosed in sealed envelopes to be opened as directed by the 
ALJ.



Sec. 35.25  Fees.

    The party requesting a subpoena shall pay the cost of the fees and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in United States District Court. A check 
for witness fees and mileage shall accompany the subpoena when served, 
except that when a subpoena is issued on behalf of the authority, a 
check for witness fees and mileage need not accompany the subpoena.



Sec. 35.26  Form, filing and service of papers.

    (a) Form. (1) Documents filed with the ALJ shall include an original 
and two copies.
    (2) Every pleading and paper filed in the proceeding shall contain a 
caption setting forth the title of the action, the case number assigned 
by the ALJ, a designation of the paper (e.g., motion to quash subpoena), 
and shall be in English or accompanied by an English translation.
    (3) Every pleading and paper shall be signed by, and shall contain 
the address and telephone number of the party or the person on whose 
behalf the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed. Date of 
mailing may be established by a certificate from the party or its 
representative or by proof that the document was sent by certified or 
registered mail.
    (b) Service. A party filing a document with the ALJ shall, at the 
time of filing, serve a copy of such document on every other party. 
Service upon any party of any document other than the complaint or 
notice of hearing, shall be made by delivering or mailing a copy to the 
party's last known address. When a party is represented by a 
representative, service shall be made upon such representative in lieu 
of the actual party.
    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, shall be proof of service.



Sec. 35.27  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued thereunder, the time begins with the day following the act, 
event, or default, and includes the last day of the period, unless it is 
a Saturday, Sunday, or legal holiday observed by the Federal Government, 
in which event it includes the next business day.
    (b) When the period of time allowed is less than seven days, 
intermediate Saturdays, Sundays, and legal holidays observed by the 
Federal Government

[[Page 152]]

shall be excluded from the computation.
    (c) Where a document has been served or issued by mail, or by 
airmail abroad, an additional five days will be added to the time 
permitted for any response.



Sec. 35.28  Motions.

    (a) Any application to the ALJ for an order or ruling shall be by 
motion. Motions shall state the relief sought, the authority relied 
upon, and the facts alleged, and shall be filed with the ALJ and served 
on all other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions shall be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 15 days after a written motion is served, or such other 
time as may be fixed by the ALJ, any party may file a response to such 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses thereto has expired, except upon consent of the parties 
or following a hearing on the motion, but may overrule or deny such 
motion without awaiting a response.
    (e) The ALJ shall make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.



Sec. 35.29  Sanctions.

    (a) The ALJ may sanction a person, including any party or 
representative for--
    (1) Failing to comply with an order, rule, or procedure governing 
the proceeding;
    (2) Failing to prosecute or defend an action; or
    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Any such sanction, including but not limited to those listed in 
paragraphs (c), (d), and (e) of this section, shall reasonably relate to 
the severity and nature of the failure or misconduct.
    (c) When a party fails to comply with an order, including an order 
for taking a deposition, the production of evidence within the party's 
control, or a request for admission, the ALJ may--
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) In the case of requests for admission, deem each matter of which 
an admission is requested to be admitted;
    (3) Prohibit the party failing to comply with such order from 
introducing evidence concerning, or otherwise relying upon, testimony 
relating to the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with such request.
    (d) If a party fails to prosecute or defend an action under this 
part commenced by service of a notice of hearing, the ALJ may dismiss 
the action or may issue an initial decision imposing penalties and 
assessments.
    (e) The ALJ may refuse to consider any motion, request, response, 
brief or other document which is not filed in a timely fashion.



Sec. 35.30  The hearing and burden of proof.

    (a) The ALJ shall conduct a hearing on the record in order to 
determine whether the defendant is liable for a civil penalty or 
assessment under Sec. 35.3 and, if so, the appropriate amount of any 
such civil penalty or assessment considering any aggravating or 
mitigating factors.
    (b) The authority shall prove defendant's liability and any 
aggravating factors by a preponderance of the evidence.
    (c) The defendant shall prove any affirmative defenses and any 
mitigating factors by a preponderance of the evidence.
    (d) The hearing shall be open to the public unless otherwise ordered 
by the ALJ for good cause shown.



Sec. 35.31  Determining the amount of penalties and assessments.

    (a) In determining an appropriate amount of civil penalties and 
assessments, the ALJ and the authority head, upon appeal, should 
evaluate any circumstances that mitigate or aggravate the violation and 
should articulate in their opinions the reasons that support the 
penalties and assessments they impose. Because of the intangible

[[Page 153]]

costs of fraud, the expense of investigating such conduct, and the need 
to deter others who might be similarly tempted, ordinarily double 
damages and a significant civil penalty should be imposed.
    (b) Although not exhaustive, the following factors are among those 
that may influence the ALJ and the authority head in determining the 
amount of penalties and assessments to impose with respect to the 
misconduct (i.e., the false, fictitious, or fraudulent claims or 
statements) charged in the complaint:
    (1) The number of false, fictitious, or fraudulent claims or 
statements;
    (2) The time period over which such claims or statements were made;
    (3) The degree of the defendant's culpability with respect to the 
misconduct;
    (4) The amount of money or the value of the property, services, or 
benefit falsely claimed;
    (5) The value of the Government's actual loss as a result of the 
misconduct, including foreseeable consequential damages and the costs of 
investigation;
    (6) The relationship of the amount imposed as civil penalties to the 
amount of the Government's loss;
    (7) The potential or actual impact of the misconduct upon national 
defense, public health or safety, or public confidence in the management 
of government programs and operations, including particularly the impact 
on the intended beneficiaries of such programs;
    (8) Whether the defendant has engaged in a pattern of the same or 
similar misconduct;
    (9) Whether the defendant attempted to conceal the misconduct;
    (10) The degree to which the defendant has involved others in the 
misconduct or in concealing it;
    (11) Where the misconduct of employees or agents is imputed to the 
defendant, the extent to which the defendant's practices fostered or 
attempted to preclude such misconduct;
    (12) Whether the defendant cooperated in or obstructed an 
investigation of the misconduct;
    (13) Whether the defendant assisted in identifying and prosecuting 
other wrongdoers;
    (14) The complexity of the program or transaction, and the degree of 
the defendant's sophistication with respect to it, including the extent 
of the defendant's prior participation in the program or in similar 
transactions;
    (15) Whether the defendant has been found, in any criminal, civil, 
or administrative proceeding to have engaged in similar misconduct or to 
have dealt dishonestly with the Government of the United States or of a 
state, directly or indirectly; and
    (16) The need to deter the defendant and others from engaging in the 
same or similar misconduct.
    (c) Nothing in this section shall be construed to limit the ALJ or 
the authority head from considering any other factors that in any given 
case may mitigate or aggravate the offense for which penalties and 
assessments are imposed.



Sec. 35.32  Location of hearing.

    (a) The hearing may be held--
    (1) In any judicial district of the United States in which the 
defendant resides or transacts business;
    (2) In any judicial district of the United States in which the claim 
or statement in issue was made; or
    (3) In such other place within the United States as may be agreed 
upon by the defendant and the ALJ.
    (b) Each party shall have the opportunity to present argument with 
respect to the location of the hearing.
    (c) The hearing shall be held at the place and at the time ordered 
by the ALJ.



Sec. 35.33  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing shall be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony may be admitted in the 
form of a written statement or deposition. Any such written statement 
must be provided to all other parties along with the last known address 
of such witness, in a manner which allows sufficient time for other 
parties to subpoena such witness for cross-examination at the hearing. 
Prior written statements of witnesses proposed to testify at the hearing 
and deposition transcripts

[[Page 154]]

shall be exchanged as provided in Sec. 35.22(a).
    (c) The ALJ shall exercise reasonable control over the mode and 
order of interrogating witnesses and presenting evidence in order to 
make--
    (1) The interrogation and presentation effective for the 
ascertainment of the truth;
    (2) To avoid needless consumption of time; and
    (3) To protect witnesses from harassment or undue embarrassment.
    (d) The ALJ shall permit the parties to conduct such cross-
examination as may be required for a full and true disclosure of the 
facts.
    (e) At the discretion of the ALJ, a witness may be cross-examined on 
matters relevant to the proceeding without regard to the scope of his or 
her direct examination. To the extent permitted by the ALJ, cross-
examination on matters outside the scope of direct examination shall be 
conducted in the manner of direct examination and may proceed by leading 
questions only if the witness is a hostile witness, an adverse party, or 
a witness identified with an adverse party.
    (f) Upon motion of any party, the ALJ shall order witnesses excluded 
so that they cannot hear the testimony of other witnesses. This rule 
does not authorize exclusion of--
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party designated by the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an individual employed by the 
Government engaged in assisting the representative for the Government.



Sec. 35.34  Evidence.

    (a) The ALJ shall determine the admissibility of evidence.
    (b) Except as provided herein, the ALJ shall not be bound by the 
Federal Rules of Evidence. However, the ALJ may apply the Federal Rules 
of Evidence where appropriate, e.g., to exclude unreliable evidence.
    (c) The ALJ shall exclude irrelevant and immaterial evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighed by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence may be excluded if it is classified 
or otherwise privileged under Federal law.
    (f) Evidence concerning offers or compromise or settlement shall be 
inadmissible to the extent provided in Rule 408 of the Federal Rules of 
Evidence.
    (g) The ALJ shall permit the parties to introduce rebuttal witnesses 
and evidence.
    (h) All documents and other evidence offered or taken for the record 
shall be open to examination by all parties, unless otherwise ordered by 
the ALJ pursuant to Sec. 35.24.



Sec. 35.35  The record.

    (a) The hearing will be recorded and transcribed. Transcripts may be 
obtained following the hearing from the ALJ at a cost not to exceed the 
actual cost of duplication.
    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, and all papers and requests filed in the 
proceeding constitute the record for the decision by the ALJ and the 
authority head.
    (c) The record may be inspected and copied (upon payment of a 
reasonable fee) by anyone, unless otherwise ordered by the ALJ pursuant 
to Sec. 35.24.



Sec. 35.36  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. In any 
event, any party may file a post-hearing brief. The ALJ shall fix the 
time for filing such briefs, not to exceed 60 days from the date the 
parties receive the transcript of the hearing or, if applicable, the 
stipulated record. Such briefs may be accompanied by proposed findings 
of fact and conclusions of law. The ALJ may permit the parties to file 
reply briefs.



Sec. 35.37  Initial decision.

    (a) The ALJ shall issue an initial decision based only on the 
record, which

[[Page 155]]

shall contain findings of fact, conclusions of law, and the amount of 
any penalties and assessments imposed.
    (b) The findings of fact shall include a finding on each of the 
following issues:
    (1) Whether the claims or statements identified in the complaint, or 
any portions thereof, violate Sec. 35.3; and
    (2) If the person is liable for penalties or assessments, the 
appropriate amount of any such penalties or assessments considering any 
mitigating or aggravating factors that he or she finds in the case, such 
as those described in Sec. 35.31.
    (c) The ALJ shall promptly serve the initial decision on all parties 
within 90 days after the time for submission of post-hearing briefs and 
reply briefs (if permitted) has expired. The ALJ shall at the same time 
serve all defendants with a statement describing the right of any 
defendant determined to be liable for a civil penalty or assessment to 
file a motion for reconsideration with the ALJ or a notice of appeal 
with the authority head. If the ALJ fails to meet the deadline contained 
in this paragraph, he or she shall notify the parties of the reason for 
the delay and shall set a new deadline.
    (d) Unless the initial decision of the ALJ is timely appealed to the 
authority head, or a motion for reconsideration of the initial decision 
is timely filed, the initial decision shall constitute the final 
decision of the authority head and shall be final and binding on the 
parties 30 days after it is issued by the ALJ.



Sec. 35.38  Reconsideration of initial decision.

    (a) Except as provided in paragraph (d) of this section, any party 
may file a motion for reconsideration of the initial decision within 20 
days of receipt of the initial decision. If service was made by mail 
within the United States, receipt will be presumed to be five days from 
the date of mailing in the absence of contrary proof.
    (b) Every such motion must set forth the matters claimed to have 
been erroneously decided and the nature of the alleged errors. Such 
motion shall be accompanied by a supporting brief.
    (c) Responses to such motions shall be allowed only upon request of 
the ALJ.
    (d) No party may file a motion for reconsideration of an initial 
decision that has been revised in response to a previous motion for 
reconsideration.
    (e) The ALJ may dispose of a motion for reconsideration by denying 
it or by issuing a revised initial decision.
    (f) If the ALJ denies a motion for reconsideration of the initial 
decision, the initial decision shall constitute the final decision of 
the authority head and shall be final and binding on the parties 30 days 
after the ALJ denies the motion, unless the initial decision is timely 
appealed to the authority head in accordance with Sec. 35.39.
    (g) If the ALJ issues a revised initial decision, that decision 
shall constitute the final decision of the authority head and shall be 
final and binding on the parties 30 days after it is issued, unless it 
is timely appealed to the authority head in accordance with Sec. 35.39.



Sec. 35.39  Appeal to authority head.

    (a) Any defendant who has filed a timely answer and who is 
determined in an initial decision to be liable for a civil penalty or 
assessment may appeal such decision to the authority head by filing a 
notice of appeal with the authority head in accordance with this 
section.
    (b)(1) No notice of appeal may be filed until the time period for 
filing a motion for reconsideration under Sec. 35.38 has expired.
    (2) If a motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ denies the motion or 
issues a revised initial decision, whichever applies.
    (3) If no motion for reconsideration is timely filed, a notice of 
appeal must be filed within 30 days after the ALJ issues the initial 
decision.
    (4) The authority head may extend the initial 30-day period for an 
additional 30 days if the defendant files with the authority head a 
request for an extension within the initial 30-day period and shows good 
cause.
    (c) If the defendant files a timely notice of appeal with the 
authority head and the time for filing motions for reconsideration under 
Sec. 35.38 has expired,

[[Page 156]]

the ALJ shall forward the record of the proceeding to the authority 
head.
    (d) A notice of appeal shall be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions.
    (e) The representative for the Government may file a brief in 
opposition to exceptions within 30 days of receiving the notice of 
appeal and accompanying brief.
    (f) There is no right to appear personally before the authority 
head.
    (g) There is no right to appeal any interlocutory ruling by the ALJ.
    (h) In reviewing the initial decision, the authority head shall not 
consider any objection that was not raised before the ALJ unless a 
demonstration is any objection that was not raised before the ALJ unless 
a demonstration is made of extraordinary circumstances causing the 
failure to raise the objection.
    (i) If any party demonstrates to the satisfaction of the authority 
head that additional evidence not presented at such hearing is material 
and that there were reasonable grounds for the failure to present such 
evidence at such hearing, the authority head shall remand the matter to 
the ALJ for consideration of such additional evidence.
    (j) The authority head may affirm, reduce, reverse, compromise, 
remand, or settle any penalty or assessment, determined by the ALJ in 
any initial decision.
    (k) The authority head shall promptly serve each party to the appeal 
with a copy of the decision of the authority head and a statement 
describing the right of the defendant to seek judicial review.
    (l) Unless a petition for review is filed as provided in 31 U.S.C. 
3805 after a defendant has exhausted all administrative remedies under 
this part and within 60 days after the date on which the authority head 
serves the defendant with a copy of the authority head's decision, a 
determination that a defendant is liable under Sec. 35.3 is final and is 
not subject to judicial review.



Sec. 35.40  Stays ordered by the Department of Justice.

    If at any time the Attorney General or an Assistant Attorney General 
designated by the Attorney General transmits to the authority head a 
written finding that continuation of the administrative process 
described in this part with respect to a claim or statement may 
adversely affect any pending or potential criminal or civil action 
related to such claim or statement, the authority head shall stay the 
process immediately. The authority head may order the process resumed 
only upon receipt of the written authorization of the Attorney General.



Sec. 35.41  Stay pending appeal.

    (a) An initial decision is stayed automatically pending disposition 
of a motion for reconsideration or of an appeal to the authority head.
    (b) No administrative stay is available following a final decision 
of the authority head.



Sec. 35.42  Judicial review.

    Section 3805 of title 31, United States Code, authorizes judicial 
review by an appropriate United States District Court of a final 
decision of the authority head imposing penalties or assessments under 
this part and specifies the procedures for such review.



Sec. 35.43  Collection of civil penalties and assessments.

    Sections 3806 and 3808(b) of title 31, United States Code, authorize 
actions for collection of civil penalties and assessments imposed under 
this part and specify the procedures for such actions.



Sec. 35.44  Right to administrative offset.

    The amount of any penalty or assessment which has become final, or 
for which a judgment has been entered under Sec. 35.42 or Sec. 35.43, or 
any amount agreed upon in a compromise or settlement under Sec. 35.46, 
may be collected by administrative offset under 31 U.S.C. 3716, except 
that an administrative offset may not be made under this subsection 
against a refund of an overpayment of federal taxes, then or later

[[Page 157]]

owing by the United States to the defendant.



Sec. 35.45  Deposit in Treasury of United States.

    All amounts collected pursuant to this part shall be deposited as 
miscellaneous receipts in the Treasury of the United States, except as 
provided in 31 U.S.C. 3806(g).



Sec. 35.46  Compromise or settlement.

    (a) Parties may make offers of compromise or settlement at any time.
    (b) The reviewing official has the exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
reviewing official is permitted to issue a complaint and before the date 
on which the ALJ issues an initial decision.
    (c) The authority head has exclusive authority to compromise or 
settle a case under this part at any time after the date on which the 
ALJ issues an initial decision, except during the pendency of any review 
under Sec. 35.42 or during the pendency of any action to collect 
penalties and assessments under Sec. 35.43.
    (d) The Attorney General has exclusive authority to compromise or 
settle a case under this part during the pendency of any review under 
Sec. 35.42 or of any action to recover penalties and assessments under 
31 U.S.C. 3806.
    (e) The investigating official may recommend settlement terms to the 
reviewing official, the authority head, or the Attorney General, as 
appropriate. The reviewing official may recommend settlement terms to 
the authority head, or the Attorney General, as appropriate.
    (f) Any compromise or settlement must be in writing.



Sec. 35.47  Limitations.

    (a) The notice of hearing with respect to a claim or statement must 
be served in the manner specified in Sec. 35.8 within six years after 
the date on which such claim or statement is made.
    (b) If the defendant fails to file a timely answer, service of 
notice under Sec. 35.10(b) shall be deemed a notice of hearing for 
purposes of this section.
    (c) The statute of limitations may be extended by agreement of the 
parties.

[[Page 158]]



                           SUBCHAPTER E--VISAS





PART 40--REGULATIONS PERTAINING TO BOTH NONIMMIGRANTS AND IMMIGRANTS UNDER THE IMMIGRATION AND NATIONALITY ACT, AS AMENDED--Table of Contents




                      Subpart A--General Provisions

Sec.
40.1  Definitions.
40.2  Documentation of nationals.
40.3  Entry into areas under U.S. administration.
40.4  Furnishing records and information from visa files for court 
          proceedings.
40.5  [Reserved]
40.6  Basis for refusal.
40.7--40.8  [Reserved]
40.9  Classes of inadmissible aliens.

               Subpart B--Medical Grounds of Ineligibility

40.11  Medical grounds of ineligibility.
40.12--40.19  [Reserved]

  Subpart C--Criminal and Related Grounds--Conviction of Certain Crimes

40.21  Crimes involving moral turpitude and controlled substance 
          violators.
40.22  Multiple criminal convictions.
40.23  Controlled substance traffickers. [Reserved]
40.24  Prostitution and commercialized vice.
40.25  Certain aliens involved in serious criminal activity who have 
          asserted immunity from prosecution. [Reserved]
40.26--40.29  [Reserved]

                 Subpart D--Security and Related Grounds

40.31  General. [Reserved]
40.32  Terrorist activities. [Reserved]
40.33  Foreign policy. [Reserved]
40.34  Immigrant membership in totalitarian party.
40.35  Participants in Nazi persecutions or genocide. [Reserved]
40.36--40.39  [Reserved]

                        Subpart E--Public Charge

40.41  Public charge.
40.42--40.49  [Reserved]

 Subpart F--Labor Certification and Qualification for Certain Immigrants

40.51  Labor certification.
40.52  Unqualified physicians.
40.53  Uncertified foreign health-care workers. [Reserved]
40.54--40.59  [Reserved]

          Subpart G--Illegal Entrants and Immigration Violators

40.61  Aliens present without admission or parole.
40.62  Failure to attend removal proceedings.
40.63  Misrepresentation; Falsely claiming citizenship.
40.64  Stowaways.
40.65  Smugglers.
40.66  Subject of civil penalty.
40.67  Student visa abusers.
40.68  Aliens subject to INA 222(g).
40.69  [Reserved]

                  Subpart H--Documentation Requirements

40.71  Documentation requirements for immigrants.
40.72  Documentation requirements for nonimmigrants.
40.73--40.79  [Reserved]

                  Subpart I--Ineligible for Citizenship

40.81  Ineligible for citizenship.
40.82  Alien who departed the United States to avoid service in the 
          Armed Forces.
40.83--40.89  [Reserved]

                  Subpart J--Aliens Previously Removed

40.91  Certain aliens previously removed.
40.92  Aliens unlawfully present.
40.93  Aliens unlawfully present after previous immigration violation.
40.94-40.99  [Reserved]

                        Subpart K--Miscellaneous

40.101  Practicing polygamists.
40.102  Guardian required to accompany excluded alien.
40.103  International child abduction.
40.104  Unlawful voters.
40.105  Former citizens who renounced citizenship to avoid taxation.
40.106-40.110  [Reserved]

                  Subpart L--Failure to Comply with INA

40.201  Failure of application to comply with INA.
40.202  Certain former exchange visitors.
40.203  Alien entitled to A, E, or G nonimmigrant classification.
40.204  Certain immigrant visa applicants.
40.205  Applicant for immigrant visa under INA 203(c).
40.206  Frivolous applications. [Reserved]
40.207--40.210  [Reserved]

[[Page 159]]

              Subpart M--Waiver of Ground of Ineligibility

40.301  Waiver for ineligible nonimmigrants under INA 212(d)(3)(A).

    Authority:  8 U.S.C. 1104; Pub.L. 104-208, 110 Stat. 3009; 22 U.S.C. 
2651a.

    Source:  56 FR 30422, July 2, 1991, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 40.1  Definitions.

    The following definitions supplement definitions contained in the 
Immigration and Nationality Act (INA). As used in these regulations, the 
term:
    (a) Accompanying or accompanied by means not only an alien in the 
physical company of a principal alien but also an alien who is issued an 
immigrant visa within 4 months of either the date of issuance of a visa 
to, or the date of adjustment of status in the United States of, the 
principal alien, or the date on which the principal alien personally 
appears and registers before a consular officer abroad to confer 
alternate foreign state chargeability or immigrant status upon a spouse 
or child. An ``accompanying'' relative may not precede the principal 
alien to the United States.
    (b) Act means the Immigration and Nationality Act (or INA), as 
amended.
    (c) Competent officer, as used in INA 101(a)(26), means a ``consular 
officer'' as defined in INA 101(a)(9).
    (d) Consular officer, as defined in INA 101(a)(9) includes 
commissioned consular officers and the Deputy Assistant Secretary for 
Visa Services, and such other officers as the Deputy Assistant Secretary 
may designate for the purpose of issuing nonimmigrant and immigrant 
visas, but does not include a consular agent, an attache or an assistant 
attache. For purposes of this regulation, the term ``other officers'' 
includes civil service visa examiners employed by the Department of 
State for duty at visa-issuing offices abroad, upon certification by the 
chief of the consular section under whose direction such examiners are 
employed that the examiners are qualified by knowledge and experience to 
perform the functions of a consular officer in the issuance or refusal 
of visas. The designation of visa examiners shall expire upon 
termination of the examiners' employment for such duty and may be 
terminated at any time for cause by the Deputy Assistant Secretary. The 
assignment by the Department of any foreign service officer to a 
diplomatic or consular office abroad in a position administratively 
designated as requiring, solely, partially, or principally, the 
performance of consular functions, and the initiation of a request for a 
consular commission, constitutes designation of the officer as a 
``consular officer'' within the meaning of INA 101(a)(9).
    (e) Department means the Department of State of the United States of 
America.
    (f) Dependent area means a colony or other component or dependent 
area overseas from the governing foreign state, natives of which are 
subject to the limitation prescribed by INA 202(c).
    (g) Documentarily qualified means that the alien has reported that 
all the documents specified by the consular officer as sufficient to 
meet the requirements of INA 222(b) have been obtained, and that 
necessary clearance procedures of the consular office have been 
completed. This term shall be used only with respect to the alien's 
qualification to apply formally for an immigrant visa; it bears no 
connotation that the alien is eligible to receive a visa.
    (h) Entitled to immigrant classification means that the alien:
    (1) Is the beneficiary of an approved petition granting immediate 
relative or preference status;
    (2) Has satisfied the consular officer as to entitlement to special 
immigrant status under INA 101(a)(27) (A) or (B);
    (3) Has been selected by the annual selection system to apply under 
INA 203(c); or
    (4) Is an alien described in Sec. 40.51(c).
    (i) With respect to alternate chargeability pursuant to INA 202(b), 
the term ``foreign state'' is not restricted to those areas to which the 
numerical limitation prescribed by INA 202(a) applies but includes 
dependent areas, as defined in this section.
    (j) INA means the Immigration and Nationality Act, as amended.

[[Page 160]]

    (k) INS means the Immigration and Naturalization Service.
    (l) Native shall mean born within the territory of a foreign state, 
or entitled to be charged for immigration purposes to that foreign state 
pursuant to section 202(b) of the Immigration and Nationality Act, as 
amended.
    (m) Not subject to numerical limitation means that the alien is 
entitled to immigrant status as an immediate relative within the meaning 
of INA 201(b)(2)(i), or as a special immigrant within the meaning of INA 
101(a)(27) (A) and (B), unless specifically subject to a limitation 
other than under INA 201(a), (b), or (c).
    (n) Parent, father, and mother, as defined in INA 101(b)(2), are 
terms which are not changed in meaning if the child becomes 21 years of 
age or marries.
    (o) Port of entry means a port or place designated by the 
Commissioner of Immigration and Naturalization at which an alien may 
apply to INS for admission into the United States.
    (p) Principal alien means an alien from whom another alien derives a 
privilege or status under the law or regulations.
    (q) Regulation means a rule which is established under the 
provisions of INA 104(a) and is duly published in the Federal Register.
    (r) Son or daughter includes only a person who would have qualified 
as a ``child'' under INA 101(b)(1) if the person were under 21 and 
unmarried.
    (s) Western Hemisphere means North America (including Central 
America), South America and the islands immediately adjacent thereto 
including the places named in INA 101(b)(5).
[56 FR 30422, July 2, 1991, as amended at 56 FR 43552, Sept. 3, 1991; 59 
FR 15300, Mar. 31, 1994; 61 FR 1835, Jan. 24, 1996]



Sec. 40.2  Documentation of nationals.

    (a) Nationals of the United States. A national of the United States 
shall not be issued a visa or other documentation as an alien for entry 
into the United States.
    (b) Former Nationals of the United States. A former national of the 
United States who seeks to enter the United States must comply with the 
documentary requirements applicable to aliens under the INA.



Sec. 40.3  Entry into areas under U.S. administration.

    An immigrant or nonimmigrant seeking to enter an area which is under 
U.S. administration but which is not within the ``United States'', as 
defined in INA 101(a)(38), is not required by the INA to be documented 
with a visa unless the authority contained in INA 215 has been invoked.



Sec. 40.4  Furnishing records and information from visa files for court proceedings.

    Upon receipt of a request for information from a visa file or record 
for use in court proceedings, as contemplated in INA 222(f), the 
consular officer must, prior to the release of the information, submit 
the request together with a full report to the Department.



Sec. 40.5  [Reserved]



Sec. 40.6  Basis for refusal.

    A visa can be refused only upon a ground specifically set out in the 
law or implementing regulations. The term ``reason to believe'', as used 
in INA 221(g), shall be considered to require a determination based upon 
facts or circumstances which would lead a reasonable person to conclude 
that the applicant is ineligible to receive a visa as provided in the 
INA and as implemented by the regulations. Consideration shall be given 
to any evidence submitted indicating that the ground for a prior refusal 
of a visa may no longer exist. The burden of proof is upon the applicant 
to establish eligibility to receive a visa under INA 212 or any other 
provision of law or regulation.



Secs. 40.7--40.8  [Reserved]



Sec. 40.9  Classes of inadmissible aliens.

    Subparts B through L describe classes of inadmissible aliens who are 
ineligible to receive visas and who shall be ineligible for admission 
into the United States, except as otherwise provided in the Immigration 
and Nationality Act, as amended.
[61 FR 59184, Nov. 21, 1996]

[[Page 161]]



               Subpart B--Medical Grounds of Ineligibility



Sec. 40.11  Medical grounds of ineligibility.

    (a) Decision on eligibility based on findings of medical doctor. A 
finding of a panel physician designated by the post in whose 
jurisdiction the examination is performed pursuant to INA 212(a)(1) 
shall be binding on the consular officer, except that the officer may 
refer a panel physician finding in an individual case to USPHS for 
review.
    (b) Waiver of ineligibility--INA 212(g). If an immigrant visa 
applicant is inadmissible under INA 212(a)(1)(A)(i), (ii), or (iii) but 
is qualified to seek the benefits of INA 212(g)(1)(A) or (B), 
212(g)(2)(C), or 212(g)(3), the consular officer shall inform the alien 
of the procedure for applying to INS for relief under the applicable 
provision of law. A visa may not be issued to the alien until the 
consular officer has received notification from INS of the approval of 
the alien's application under INA 212(g), unless the consular officer 
has been delegated authority by the Attorney General to grant the 
particular waiver under INA 212(g).
    (c) Waiver authority--INA 212(g)(2)(A) and (B). The consular officer 
may waive section 212(a)(1)(A)(ii) visa ineligibility if the alien 
qualifies for such waiver under the provisions of INA 212(g)(2)(A) or 
(B).
[56 FR 30422, July 2, 1991, as amended at 62 FR 67567, Dec. 29, 1997]



Secs. 40.12--40.19  [Reserved]



  Subpart C--Criminal and Related Grounds--Conviction of Certain Crimes



Sec. 40.21  Crimes involving moral turpitude and controlled substance violators.

    (a) Crimes involving moral turpitude--(1) Acts must constitute a 
crime under criminal law of jurisdiction where they occurred. Before a 
finding of ineligibility under INA 212(a)(2)(A)(i)(I) may be made 
because of an admission of the commission of acts which constitute the 
essential elements of a crime involving moral turpitude, it must first 
be established that the acts constitute a crime under the criminal law 
of the jurisdiction where they occurred. A determination that a crime 
involves moral turpitude shall be based upon the moral standards 
generally prevailing in the United States.
    (2) Conviction for crime committed under age 18. An alien shall not 
be ineligible to receive a visa under INA 212(a)(2)(A)(i)(I) by reason 
of any offense committed prior to the alien's fifteenth birthday. Nor 
shall an alien be ineligible to receive a visa under INA 
212(a)(2)(A)(i)(I) by reason of any offense committed between the 
alien's fifteenth and eighteenth birthdays unless such alien was tried 
and convicted as an adult for a felony involving violence as defined in 
section 1(l) and section 16 of title 18 of the United States Code. An 
alien tried and convicted as an adult for a violent felony offense, as 
so defined, committed after having attained the age of fifteen years, 
shall be subject to the provisions of INA 212(a)(2)(A)(i)(I) regardless 
of whether at that time juvenile courts existed within the jurisdiction 
of the convictions.
    (3) Two or more crimes committed under age 18. An alien convicted of 
a crime involving moral turpitude or admitting the commission of acts 
which constitute the essential elements of such a crime and who has 
committed an additional crime involving moral turpitude shall be 
ineligible under INA 212(a)(2)(A)(i)(I), even though the crimes were 
committed while the alien was under the age of 18 years.
    (4) Conviction in absentia. A conviction in absentia of a crime 
involving moral turpitude does not constitute a conviction within the 
meaning of INA 212(a)(2)(A)(i)(I).
    (5) Effect of pardon by appropriate U.S. authorities/foreign states. 
An alien shall not be considered ineligible under INA 212(a)(2)(A)(i)(I) 
by reason of a conviction of a crime involving moral turpitude for which 
a full and unconditional pardon has been granted by the President of the 
United States, by the Governor of a State of the United States, by the 
former High Commissioner for Germany acting pursuant to Executive Order 
10062, or by the United States Ambassador to the Federal Republic of

[[Page 162]]

Germany acting pursuant to Executive Order 10608. A legislative pardon 
or a pardon, amnesty, expungement of penal record or any other act of 
clemency granted by a foreign state shall not serve to remove a ground 
of ineligibility under INA 212(a)(2)(A)(i)(I).
    (6) Political offenses. The term ``purely political offense'', as 
used in INA 212(a)(2)(A)(i)(I), includes offenses that resulted in 
convictions obviously based on fabricated charges or predicated upon 
repressive measures against racial, religious, or political minorities.
    (7) Waiver of ineligibility--INA 212(h). If an immigrant visa 
applicant is ineligible under INA 212(a)(2)(A)(i)(I) but is qualified to 
seek the benefits of INA 212(h), the consular officer shall inform the 
alien of the procedure for applying to INS for relief under that 
provision of law. A visa may not be issued to the alien until the 
consular officer has received notification from INS of the approval of 
the alien's application under INA 212(h).
    (b) Controlled substance violators--(1) Date of conviction not 
pertinent. An alien shall be ineligible under INA 212(a)(2)(A)(i)(II) 
irrespective of whether the conviction for a violation of or for 
conspiracy to violate any law or regulation relating to a controlled 
substance, as defined in the Controlled Substance Act (21 U.S.C. 802), 
occurred before, on, or after October 27, 1986.
    (2) Waiver of ineligibility--INA 212(h). If an immigrant visa 
applicant is ineligible under INA 212(a)(2)(A)(i)(II) but is qualified 
to seek the benefits of INA 212(h), the consular officer shall inform 
the alien of the procedure for applying to INS for relief under that 
provision of law. A visa may not be issued to the alien until the 
consular officer has received notification from INS of the approval of 
the alien's application under INA 212(h).



Sec. 40.22  Multiple criminal convictions.

    (a) Conviction(s) for crime(s) committed under age 18. An alien 
shall not be ineligible to receive a visa under INA 212(a)(2)(B) by 
reason of any offense committed prior to the alien's fifteenth birthday. 
Nor shall an alien be ineligible under INA 212(a)(2)(B) by reason of any 
offense committed between the alien's fifteenth and eighteenth birthdays 
unless such alien was tried and convicted as an adult for a felony 
involving violence as defined in section 1(l) and section 16 of Title 18 
of the United States Code. An alien, tried and convicted as an adult for 
a violent felony offense, as so defined, committed after having attained 
the age of fifteen years, and who has also been convicted of at least 
one other such offense or any other offense committed as an adult, shall 
be subject to the provisions of INA 212(a)(2)(B) regardless of whether 
at that time juvenile courts existed within the jurisdiction of the 
conviction.
    (b) Conviction in absentia. A conviction in absentia shall not 
constitute a conviction within the meaning of INA 212(a)(2)(B).
    (c) Effect of pardon by appropriate U.S. authorities/foreign states. 
An alien shall not be considered ineligible under INA 212(a)(2)(B) by 
reason in part of having been convicted of an offense for which a full 
and unconditional pardon has been granted by the President of the United 
States, by the Governor of a State of the United States, by the former 
High Commissioner for Germany acting pursuant to Executive Order 10062, 
or by the United States Ambassador to the Federal Republic of Germany 
acting pursuant to Executive Order 10608. A legislative pardon or a 
pardon, amnesty, expungement of penal record or any other act of 
clemency granted by a foreign state shall not serve to remove a ground 
of ineligibility under INA 212(a)(2)(B).
    (d) Political offense. The term ``purely political offense'', as 
used in INA 212(a)(2)(B), includes offenses that resulted in convictions 
obviously based on fabricated charges or predicated upon repressive 
measures against racial, religious, or political minorities.
    (e) Waiver of ineligibility--INA 212(h). If an immigrant visa 
applicant is ineligible under INA 212(a)(2)(B) but is qualified to seek 
the benefits of INA 212(h), the consular officer shall inform the alien 
of the procedure for applying to INS for relief under that provision of 
law. A visa may not be issued to the

[[Page 163]]

alien until the consular officer has received notification from INS of 
the approval of the alien's application under INA 212(h).
[56 FR 30422, July 2, 1991, as amended at 62 FR 67567, Dec. 29, 1997]



Sec. 40.23  Controlled substance traffickers. [Reserved]



Sec. 40.24  Prostitution and commercialized vice.

    (a) Activities within 10 years preceding visa application. An alien 
shall be ineligible under INA 212(a)(2)(D) only if--
    (1) The alien is coming to the United States solely, principally, or 
incidentally to engage in prostitution, or has engaged in prostitution, 
or the alien directly or indirectly procures or attempts to procure, or 
procured or attempted to procure or to import prostitutes or persons for 
the purposes of prostitution, or receives or received, in whole or in 
part, the proceeds of prostitution; and
    (2) The alien has performed one of the activities listed in 
Sec. 40.24(a)(1) within the last ten years.
    (b) Prostitution defined. The term ``prostitution'' means engaging 
in promiscuous sexual intercourse for hire. A finding that an alien has 
``engaged'' in prostitution must be based on elements of continuity and 
regularity, indicating a pattern of behavior or deliberate course of 
conduct entered into primarily for financial gain or for other 
considerations of material value as distinguished from the commission of 
casual or isolated acts.
    (c) Where prostitution not illegal. An alien who is within one or 
more of the classes described in INA 212(a)(2)(D) is ineligible to 
receive a visa under that section even if the acts engaged in are not 
prohibited under the laws of the foreign country where the acts 
occurred.
    (d) Waiver of ineligibility--INA 212(h). If an immigrant visa 
applicant is ineligible under INA 212(a)(2)(D) but is qualified to seek 
the benefits of INA 212(h), the consular officer shall inform the alien 
of the procedure for applying to INS for relief under that provision of 
law. A visa may not be issued to the alien until the consular officer 
has received notification from INS of the approval of the alien's 
application under INA 212(h).



Sec. 40.25  Certain aliens involved in serious criminal activity who have asserted immunity from prosecution. [Reserved]



Secs. 40.26--40.29  [Reserved]



                 Subpart D--Security and Related Grounds



Sec. 40.31  General. [Reserved]



Sec. 40.32  Terrorist activities. [Reserved]



Sec. 40.33  Foreign policy. [Reserved]



Sec. 40.34  Immigrant membership in totalitarian party.

    (a) Definition of affiliate. The term affiliate, as used in INA 
212(a)(3)(D), means an oganization which is related to, or identified 
with, a proscribed association or party, including any section, 
subsidiary, branch, or subdivision thereof, in such close association as 
to evidence an adherence to or a furtherance of the purposes and 
objectives of such association or party, or as to indicate a working 
alliance to bring to fruition the purposes and objectives of the 
proscribed association or party. An organization which gives, loans, or 
promises support, money, or other thing of value for any purpose to any 
proscribed association or party is presumed to be an affiliate of such 
association or party, but nothing contained in this paragraph shall be 
construed as an exclusive definition of the term affiliate.
    (b) Service in Armed Forces. Service, whether voluntary or not, in 
the armed forces of any country shall not be regarded, of itself, as 
constituting or establishing an alien's membership in, or affiliation 
with, any proscribed party or organization, and shall not, of itself, 
constitute a ground of ineligibility to receive a visa.
    (c) Voluntary Service in a Political Capacity. Voluntary service in 
a political capacity shall constitute affiliation with the political 
party or organization in power at the time of such service.
    (d) Voluntary Membership After Age 16. If an alien continues or 
continued membership in or affiliation with a proscribed organization on 
or after

[[Page 164]]

reaching 16 years of age, only the alien's activities after reaching 
that age shall be pertinent to a determination of whether the 
continuation of membership or affiliation is or was voluntary.
    (e) Operation of Law Defined. The term operation of law, as used in 
INA 212(a)(3)(D), includes any case wherein the alien automatically, and 
without personal acquiescence, became a member of or affiliated with a 
proscribed party or organization by official act, proclamation, order, 
edict, or decree.
    (f) Membership in Organization Advocating Totalitarian Dictatorship 
in the United States. In accordance with the definition of totalitarian 
party contained in INA 101(a)(37), a former or present voluntary member 
of, or an alien who was, or is, voluntarily affiliated with a 
noncommunist party, organization, or group, or of any section, 
subsidiary, branch, affiliate or subdivision thereof, which during the 
time of its existence did not or does not advocate the establishment in 
the United States of a totalitarian dictatorship, is not considered 
ineligible under INA 212(a)(3)(D) to receive a visa.
    (g) Waiver of ineligibility--212(a)(3)(D)(iv). lf an immigrant visa 
applicant is ineligible under INA 212(a)(3)(D) but is qualified to seek 
the benefits of INA 212(a)(3)(D)(iv), the consular officer shall inform 
the alien of the procedure for applying to INS for relief under that 
provision of law. A visa may not be issued to the alien until the 
consular officer has received notification from INS of the approval of 
the alien's application under INA 212(a)(3)(D)(iv).



Sec. 40.35  Participants in Nazi persecutions or genocide.

    (a) Participation in Nazi persecutions. [Reserved]
    (b) Participation in genocide. [Reserved]



Secs. 40.36--40.39  [Reserved]



                        Subpart E--Public Charge



Sec. 40.41  Public charge.

    (a) Basis for Determination of Ineligibility. Any determination that 
an alien is ineligible under INA 212(a)(4) must be predicated upon 
circumstances indicating that, notwithstanding any affidavit of support 
that may have been filed on the alien's behalf, the alien is likely to 
become a public charge after admission, or, if applicable, that the 
alien has failed to fulfill the affidavit of support requirement of INA 
212(a)(4)(C).
    (b)  Affidavit of Support. Any alien seeking an immigrant visa under 
INA 201(b)(2), 203(a), or 203(b), based upon a petition filed by a 
relative of the alien (or in the case of a petition filed under INA 
203(b) by an entity in which a relative has a significant ownership 
interest), shall be required to present to the consular officer an 
affidavit of support on a form that complies with terms and conditions 
established by the Attorney General.
    (c) Joint Sponsors. Submission of one or more additional affidavits 
of support by a joint sponsor/sponsors is required whenever the relative 
sponsor's household income and significant assets, and the immigrant's 
assets, do not meet the Federal poverty line requirements of INA 213A.
    (d) Posting of Bond. A consular officer may issue a visa to an alien 
who is within the purview of INA 212(a)(4) (subject to the affidavit of 
support requirement and attribution of sponsor's income and resources 
under section 213A), upon receipt of a notice from INS of the giving of 
a bond or undertaking in accordance with INA 213 and INA 221(g), and 
provided further that the officer is satisfied that the giving of such 
bond or undertaking removes the likelihood that the alien will become a 
public charge within the meaning of this section of the law and that the 
alien is otherwise eligible in all respects.
    (e) Prearranged Employment. An immigrant visa applicant relying on 
an offer of prearranged employment to establish eligibility under INA 
212(a)(4), other than an offer of employment certified by the Department 
of Labor pursuant to INA 212(a)(5)(A), must provide written confirmation 
of the relevant information sworn and subscribed to before a notary 
public by the employer or an authorized employee or agent of the 
employer. The signer's printed

[[Page 165]]

name and position or other relationship with the employer must accompany 
the signature.
    (f) Use of Federal Poverty Line Where INA 213A Not Applicable. An 
immigrant visa applicant, not subject to the requirements of INA 213A, 
and relying solely on personal income to establish eligibility under INA 
212(a)(4), who does not demonstrate an annual income above the Federal 
poverty line, as defined in INA 213A (h), and who is without other 
adequate financial resources, shall be presumed ineligible under INA 
212(a)(4).
[62 FR 67564, Dec. 29, 1997]



Secs. 40.42--40.49  [Reserved]



 Subpart F--Labor Certification and Qualification for Certain Immigrants



Sec. 40.51  Labor certification.

    (a) INA 212(a)(5) applicable only to certain immigrant aliens. INA 
212(a)(5)(A) applies only to immigrant aliens described in INA 203(b)(2) 
or (3) who are seeking to enter the United States for the purpose of 
engaging in gainful employment.
    (b) Determination of need for alien's labor skills. An alien within 
one of the classes to which INA 212(a)(5) applies as described in 
Sec. 40.51(a) who seeks to enter the United States for the purpose of 
engaging in gainful employment, shall be ineligible under INA 
212(a)(5)(A) to receive a visa unless the Secretary of Labor has 
certified to the Attorney General and the Secretary of State, that
    (1) There are not sufficient workers in the United States who are 
able, willing, qualified, (or equally qualified in the case of aliens 
who are members of the teaching profession or who have exceptional 
ability in the sciences or the arts) and available at the time of 
application for a visa and at the place to which the alien is destined 
to perform such skilled or unskilled labor, and
    (2) The employment of such alien will not adversely affect the wages 
and working conditions of the workers in the United States similarly 
employed.
    (c) Labor certification not required in certain cases. A spouse or 
child accompanying or following to join an alien spouse or parent who is 
a beneficiary of a petition approved pursuant to INA 203(b)(2) or (3) is 
not considered to be within the purview of INA 212(a)(5).
[56 FR 30422, July 2, 1991, as amended at 61 FR 1835, Jan. 24, 1996]



Sec. 40.52  Unqualified physicians.

    INA 212(a)(5)(B) applies only to immigrant aliens described in INA 
203(b) (2) or (3).
[61 FR 1835, Jan. 24, 1996, as amended at 62 FR 67567, Dec. 29, 1997]



Sec. 40.53  Uncertified foreign health-care workers. [Reserved]



Secs. 40.54--40.59  [Reserved]



          Subpart G--Illegal Entrants and Immigration Violators



Sec. 40.61  Aliens present without admission or parole.

    INA 212(a)(6)(A)(i) does not apply at the time of visa issuance.
[62 FR 67567, Dec. 29, 1997]



Sec. 40.62  Failure to attend removal proceedings.

    An alien who without reasonable cause failed to attend, or to remain 
in attendance at, a hearing initiated on or after April 1, 1997, under 
INA 240 to determine inadmissibility or deportability shall be 
ineligible for a visa under INA 212(a)(6)(B) for five years following 
the alien's subsequent departure or removal from the United States.
[62 FR 67567, Dec. 29, 1997]



Sec. 40.63  Misrepresentation; Falsely claiming citizenship.

    (a) Fraud and misrepresentation and INA 212(a)(6)(C) applicability 
to certain refugees. An alien who seeks to procure, or has sought to 
procure, or has procured a visa, other documentation, or entry into the 
United States or other benefit provided under the INA by fraud or by 
willfully misrepresenting a material fact at any time shall be 
ineligible under INA 212(a)(6)(C); Provided, That the provisions of this 
paragraph are not applicable if the fraud or misrepresentation was 
committed by an alien at the time the alien sought

[[Page 166]]

entry into a country other than the United States or obtained travel 
documents as a bona fide refugee and the refugee was in fear of being 
repatriated to a former homeland if the facts were disclosed in 
connection with an application for a visa to enter the United States: 
Provided further, That the fraud or misrepresentation was not committed 
by such refugee for the purpose of evading the quota or numerical 
restrictions of the U.S. immigration laws, or investigation of the 
alien's record at the place of former residence or elsewhere in 
connection with an application for a visa.
    (b) Misrepresentation in application under Displaced Persons Act or 
Refugee Relief Act. Subject to the conditions stated in INA 
212(a)(6)(c)(i), an alien who is found by the consular officer to have 
made a willful misrepresentation within the meaning of section 10 of the 
Displaced Persons Act of 1948, as amended, for the purpose of gaining 
admission into the United States as an eligible displaced person, or to 
have made a material misrepresentation within the meaning of section 
11(e) of the Refugee Relief Act of 1953, as amended, for the purpose of 
gaining admission into the United States as an alien eligible thereunder 
, shall be considered ineligible under the provisions of INA 
212(a)(6)(C).
    (c) Waiver of ineligibility--INA 212(i). If an immigrant applicant 
is ineligible under INA 212(a)(6)(C) but is qualified to seek the 
benefits of INA 212(i), the consular officer shall inform the alien of 
the procedure for applying to INS for relief under that provision of 
law. A visa may not be issued to the alien until the consular officer 
has received notification from INS of the approval of the alien's 
application under INA 212(i).
[56 FR 30422, July 2, 1991, as amended at 61 FR 1835, Jan. 24, 1996]



Sec. 40.64  Stowaways.

    INA 212(a)(6)(D) is not applicable at the time of visa application.



Sec. 40.65  Smugglers.

    (a) General. A visa shall not be issued to an alien who at any time 
knowingly has encouraged, induced, assisted, abetted, or aided any other 
alien to enter or to try to enter the United States in violation of law.
    (b) Waiver of ineligibility--INA 212(d)(11). If an immigrant 
applicant is ineligible under INA 212(a)(6)(E) but is qualified to seek 
the benefits of INA 212(d)(11), the consular officer shall inform the 
alien of the procedure for applying to INS for relief under that 
provision of law. A visa may not be issued to the alien until the 
consular officer has received notification from INS of the approval of 
the alien's application under INA 212(d)(11).



Sec. 40.66  Subject of civil penalty.

    (a) General. An alien who is the subject of a final order imposing a 
civil penalty for a violation under INA 274C shall be ineligible for a 
visa under INA 212(a)(6)(F).
    (b) Waiver of ineligibility. If an applicant is ineligible under 
paragraph (a) of this section but appears to the consular officer to 
meet the prerequisites for seeking the benefits of INA 212(d)(12), the 
consular officer shall inform the alien of the procedure for applying to 
INS for relief under that provision of law. A visa may not be issued to 
the alien until the consular officer has received notification from INS 
of the approval of the alien's application under INA 212(d)(12).
[62 FR 67567, Dec. 29, 1997]



Sec. 40.67  Student visa abusers.

    An alien ineligible under the provisions of INA 212(a)(6)(G) shall 
not be issued a visa unless the alien has complied with the time 
limitation set forth therein.
[62 FR 67568, Dec. 29, 1997]



Sec. 40.68  Aliens subject to INA 222(g).

    An alien who, under the provisions of INA 222(g), has voided a 
nonimmigrant visa by remaining in the United States beyond the period of 
authorized stay is ineligible for a new nonimmigrant visa unless the 
alien complies with the requirements in 22 CFR 41.101 (b) or (c) 
regarding the place of application.
[63 FR 671, Jan. 7, 1998]

[[Page 167]]



Sec. 40.69  [Reserved]



                  Subpart H--Documentation Requirements



Sec. 40.71  Documentation requirements for immigrants.

    INA 212(a)(7)(A) is not applicable at the time of visa application. 
(For waiver of documentary requirements for immigrants see 22 CFR 42.1 
and 42.2.)



Sec. 40.72  Documentation requirements for nonimmigrants.

    A passport which is valid indefinitely for the return of the bearer 
to the country whose government issued such passport shall be deemed to 
have the required minimum period of validity as specified in INA 
212(a)(7)(B).



Secs. 40.73--40.79  [Reserved]



                 Subpart I--Ineligible for Citizenship.



Sec. 40.81  Ineligible for citizenship.

    An alien shall be ineligible to receive an immigrant visa under INA 
212(a)(8)(A) if the applicant is ineligible for citizenship.



Sec. 40.82  Alien who departed the United States to avoid service in the armed forces.

    (a) Applicability to immigrants. INA 212(a)(8)(A) applies to 
immigrant visa applicants who have departed from or remained outside the 
United States between September 8, 1939 and September 24, 1978, to avoid 
or evade training or service in the United States Armed Forces.
    (b) Applicability to nonimmigrants. INA 212(a)(8)(B) applies to 
nonimmigrant visa applicants who have departed from or remained outside 
the United States between September 8, 1939 and September 24, 1978 to 
avoid or evade training or service in the U.S. Armed Forces except an 
alien who held nonimmigrant status at the time of such departure.



Secs. 40.83--40.89  [Reserved]



                  Subpart J--Aliens Previously Removed

    Source:  61 FR 59184, Nov. 21, 1996, unless otherwise noted.



Sec. 40.91  Certain aliens previously removed.

    (a) 5-year bar. An alien who has been found inadmissible, whether as 
a result of a summary determination of inadmissibility at the port of 
entry under INA 235(b)(1) or of a finding of inadmissibility resulting 
from proceedings under INA 240 initiated upon the alien's arrival in the 
United States, shall be ineligible for a visa under INA 212(a)(9)(A)(i) 
for 5 years following removal from the United States if prior to the 
alien's reembarkation at a place outside the United States that is the 
alien's first such removal.
    (b) 10-year bar. An alien who has otherwise been removed from the 
United States under any provision of law, or who departed while an order 
of removal was in effect, is ineligible for a visa under INA 
212(a)(9)(A)(ii) for 10 years following such removal or departure from 
the United States.
    (c) 20-year bar. An alien who has been removed from the United 
States two or more times shall be ineligible for a visa under INA 
212(a)(9)(A)(i) or INA 212(a)(9)(A)(ii), as appropriate, for 20 years 
following the most recent such removal or departure.
    (d) Permanent bar. If an alien who has been removed has also been 
convicted of an aggravated felony, the alien is permanently ineligible 
for a visa under INA 212(a)(9)(A)(i) or 212(a)(9)(A)(ii), as 
appropriate.
    (e) Exceptions. An alien shall not be ineligible for a visa under 
INA 212(a)(9)(A)(i) or (ii) if the Attorney General has consented to the 
alien's application for admission.
[62 FR 67568, Dec. 29, 1997]



Sec. 40.92  Aliens unlawfully present.

    (a) 3-year bar. An alien described in INA 212(a)(9)(B)(i)(I) shall 
be ineligible for a visa for 3 years following departure from the United 
States.

[[Page 168]]

    (b) 10-year bar. An alien described in INA 212(a)(9)(B)(i)(II) shall 
be ineligible for a visa for 10 years following departure from the 
United States.
    (c) Waiver. If a visa applicant is inadmissible under paragraph (a) 
or (b) of this section but appears to the consular officer to meet the 
prerequisites for seeking the benefits of INA 212(a)(9)(B)(v), the alien 
shall be informed of the procedure for applying to INS for relief under 
that provision of law.
[62 FR 67568, Dec. 29, 1997]



Sec. 40.93  Aliens unlawfully present after previous immigration violation.

    An alien described in INA 212(a)(9)(C)(i) is permanently ineligible 
for a visa unless the Attorney General consents to the alien's 
application for readmission not less than 10 years following the alien's 
last departure from the United States. Such application for readmission 
shall be made prior to the alien's reembarkation at a place outside the 
United States.
[62 FR 67568, Dec. 29, 1997]



Secs. 40.94-40.99  [Reserved]



                        Subpart K--Miscellaneous

    Source:  56 FR 30422, July 2, 1991, unless otherwise noted. 
Redesignated at 61 FR 59184, Nov. 21, 1996.



Sec. 40.101  Practicing polygamists.

    An immigrant alien shall be ineligible under INA 212(a)(9)(A) only 
if the alien is coming to the United States to practice polygamy.



Sec. 40.102  Guardian required to accompany excluded alien.

    INA 212(a)(9)(B) is not applicable at the time of visa application.



Sec. 40.103  International child abduction.

    An alien who would otherwise be ineligible under INA 212(a)(9)(C)(i) 
shall not be ineligible under such paragraph if the U.S. citizen child 
in question is physically located in a foreign state which is party to 
the Hague Convention on the Civil Aspects of International Child 
Abduction.
[61 FR 1833, Jan. 24, 1996]



Sec. 40.104  Unlawful voters.

    An alien who at any time has voted in violation of any Federal, 
State, or local constitutional provision, statute, ordinance or 
regulation is ineligible for a visa under INA 212(a)(10)(D).
[62 FR 67568, Dec. 29, 1997]



Sec. 40.105  Former citizens who renounced citizenship to avoid taxation.

    An alien who is a former citizen of the United States, who on or 
after September 30, 1996, has officially renounced United States 
citizenship and who has been determined by the Attorney General to have 
renounced citizenship to avoid United States taxation, is ineligible for 
a visa under INA 212(a)(10)(E).
[62 FR 67568, Dec. 29, 1997]



Secs. 40.106-40.110  [Reserved]



                  Subpart L--Failure to Comply with INA

    Source:  56 FR 30422, July 2, 1991, unless otherwise noted. 
Redesignated at 61 FR 59184, Nov. 21, 1996.



Sec. 40.201  Failure of application to comply with INA.

    (a) Refusal under INA 221(g). The consular officer shall refuse an 
alien's visa application under INA 221(g)(2) as failing to comply with 
the provisions of INA or the implementing regulations if:
    (1) The applicant fails to furnish information as required by law or 
regulations;
    (2) The application contains a false or incorrect statement other 
than one which would constitute a ground of ineligibility under INA 
212(a)(6)(C);
    (3) The application is not supported by the documents required by 
law or regulations;
    (4) The applicant refuses to be fingerprinted as required by 
regulations;
    (5) The necessary fee is not paid for the issuance of the visa or, 
in the case of an immigrant visa, for the application therefor;
    (6) In the case of an immigrant visa application, the alien fails to 
swear to,

[[Page 169]]

or affirm, the application before the consular officer; or
    (7) The application otherwise fails to meet specific requirements of 
law or regulations for reasons for which the alien is responsible.
    (b) Reconsideration of refusals. A refusal of a visa application 
under paragraph (a)(1) of this section does not bar reconsideration of 
the application upon compliance by the applicant with the requirements 
of INA and the implementing regulations or consideration of a subsequent 
application submitted by the same applicant.
[56 FR 30422, July 2, 1991, as amended at 61 FR 1835, Jan. 24, 1996. 
Redesignated at 61 FR 59184, Nov. 21, 1996]



Sec. 40.202  Certain former exchange visitors.

    An alien who was admitted into the United States as an exchange 
visitor, or who acquired such status after admission, and who is within 
the purview of INA 212(e) as amended by the Act of April 7, 1970, (84 
Stat. 116) and by the Act of October 12, 1976, (90 Stat. 2301), is not 
eligible to apply for or receive an immigrant visa or a nonimmigrant 
visa under INA 101(a)(15) (H), (K), or (L), notwithstanding the approval 
of a petition on the alien's behalf, unless:
    (a) It has been established that the alien has resided and has been 
physically present in the country of the alien's nationality or last 
residence for an aggregate of at least 2 years following the termination 
of the alien's exchange visitor status as required by INA 212(e), or
    (b) The foreign residence requirement of INA 212(e) has been waived 
by the Attorney General in the alien's behalf.



Sec. 40.203  Alien entitled to A, E, or G nonimmigrant classification.

    An alien entitled to nonimmigrant classification under INA 
101(a)(15) (A), (E), or (G) who is applying for an immigrant visa and 
who intends to continue the activities required for such nonimmigrant 
classification in the United States is not eligible to receive an 
immigrant visa until the alien executes a written waiver of all rights, 
privileges, exemptions and immunities which would accrue by reason of 
such occupational status.



Sec. 40.204  Certain Immigrant Visa Applicants.

    An alien who has been physically present in the United States shall 
not be eligible to receive an immigrant visa within ninety days 
following departure therefrom unless:
    (a) the alien was maintaining a lawful nonimmigrant status at the 
time of such departure, or
    (b) the alien is the spouse or unmarried child of an individual who 
obtained temporary or permanent resident status under INA 210 or 245A or 
section 202 of the Immigration Reform and Control Act of 1986 at any 
date, who:
    (1) as of May 5, 1988, was the unmarried child or spouse of the 
individual who obtained temporary or permanent resident status under INA 
210 or 245A or section 202 of the Immigration Reform and Control Act of 
1986;
    (2) entered the United States before May 5, 1988, resided in the 
United States on May 5, 1988, and is not a lawful permanent resident; 
and
    (3) applied for benefits under section 301(a) of the Immigration Act 
of 1990.
[59 FR 51369, Oct. 11, 1994. Redesignated at 61 FR 59184, Nov. 21, 1996]



Sec. 40.205  Applicant for immigrant visa under INA 203(c).

    An alien shall be ineligible to receive a visa under INA 203(c) if 
the alien does not have a high school education or its equivalent, as 
defined in 22 CFR 42.33(a)(2), or does not have, within the five years 
preceding the date of application for such visa, at least two years of 
work experience in an occupation which requires at least two years of 
training or experience.
[59 FR 55045, Nov. 3, 1994. Redesignated at 61 FR 59184, Nov. 21, 1996]



Sec. 40.206  Frivolous applications [Reserved]



Secs. 40.207-40.210  [Reserved]



              Subpart M--Waiver of Ground of Ineligibility

    Source:  56 FR 30422, July 2, 1991, unless otherwise noted. 
Redesignated at 61 FR 59184, Nov. 21, 1996]

[[Page 170]]



Sec. 40.301  Waiver for ineligible nonimmigrants under INA 212(d)(3)(A).

    (a) Report or recommendation to Department. Except as provided in 
paragraph (b) of this section, consular officers may, upon their own 
initiative, and shall, upon the request of the Secretary of State or 
upon the request of the alien, submit a report to the Department for 
possible transmission to the Attorney General pursuant to the provisions 
of INA 212(d)(3)(A) in the case of an alien who is classifiable as a 
nonimmigrant but who is known or believed by the consular officer to be 
ineligible to receive a nonimmigrant visa under the provisions of INA 
212(a), other than INA 212(a) (3)(A), (3)(C) or (3)(E).
    (b) Recommendation to designated INS officer abroad. A consular 
officer may, in certain categories defined by the Secretary of State, 
recommend directly to designated INS officers that the temporary 
admission of an alien ineligible to receive a visa be authorized under 
INA 212(d)(3)(A).
    (c) Attorney General may impose conditions. When the Attorney 
General authorizes the temporary admission of an ineligible alien as a 
nonimmigrant and the consular officer is so informed, the consular 
officer may proceed with the issuance of a nonimmigrant visa to the 
alien, subject to the conditions, if any, imposed by the Attorney 
General.



PART 41--VISAS: DOCUMENTATION OF NONIMMIGRANTS UNDER THE IMMIGRATION AND NATIONALITY ACT, AS AMENDED--Table of Contents




  Subpart A--Passport and Visas Not Required for Certain Nonimmigrants

Sec.
41.1  Exemption by law or treaty from passport and visa requirements.
41.2  Waiver by Secretary of State and Attorney General of passport and/
          or visa requirements for certain categories of nonimmigrants.
41.3  Waiver by joint action of consular and immigration officers of 
          passport and/or visa requirements.

               Subpart B--Classification of Nonimmigrants

41.11  Entitlement to nonimmigrant status.
41.12  Classification symbols.

                 Subpart C--Foreign Government Officials

41.21  General.
41.22  Officials of foreign governments.
41.23  Accredited officials in transit.
41.24  International organization aliens.
41.25  NATO representatives, officials, and employees.
41.26  Diplomatic visas.
41.27  Official visas.

                      Subpart D--Temporary Visitors

41.31  Temporary visitors for business or pleasure.
41.32  Nonresident alien Mexican border crossing identification cards; 
          combined border crossing identification cards and B-1/B-2 
          visitor visa.
41.33  Nonresident alien Canadian border crossing identification card 
          (BCC).

                 Subpart E--Crewman and Crew-List Visas

41.41  Crewmen.
41.42  Crew-list visas.

                   Subpart F--Business and Media Visas

41.51  Treaty trader or treaty investor.
41.52  Information media representative.
41.53  Temporary workers and trainees.
41.54  Intracompany transferees (executives, managers, and specialists).
41.55  Aliens with extraordinary ability.
41.56  Athletes, artists and entertainers.
41.57  International cultural exchange visitors.
41.58  Aliens in religious occupations.
41.59  Professionals under the North American Free Trade Agreement.

                Subpart G--Students and Exchange Visitors

41.61  Students--academic and nonacademic.
41.62  Exchange visitors.

                        Subpart H--Transit Aliens

41.71  Transit aliens.

              Subpart I--Fiance(e)s and Other Nonimmigrants

41.81  Fiance(e) of a U.S. citizen.
41.82  Certain parents and children of section 101(a)(27)(I) special 
          immigrants [Reserved].
41.83  Certain witnesses and informants.

              Subpart J--Application for Nonimmigrant Visa

41.101  Place of application.
41.102  Personal appearance of applicant.
41.103  Filing an application and Form OF-156.

[[Page 171]]

41.104  Passport requirements.
41.105  Supporting documents and fingerprinting.
41.106  Processing.
41.107  Visa fees.
41.108  Medical examination.

                Subpart K--Issuance of Nonimmigrant Visa

41.111  Authority to issue visa.
41.112  Validity of visa.
41.113  Procedures in issuing visas.
41.114  Transfer of visas.

                   Subpart L--Refusals and Revocations

41.121  Refusal of individual visas.
41.122  Revocation of visas.

    Authority:  INA 104, 66 Stat. 174, 8 U.S.C. 1104; sec. 109(b)(1), 91 
Stat. 847; sec. 204, 104 Stat. 5019, 8 U.S.C. 1101 note.

    Source:  52 FR 42597, Nov. 5, 1987, unless otherwise noted.



   Subpart A-Passport and Visas Not Required for Certain Nonimmigrants



Sec. 41.1  Exemption by law or treaty from passport and visa requirements.

    Nonimmigrants in the following categories are exempt from the 
passport and visa requirements of INA 212(a)(7)(B)(i)(I), (i)(II):
    (a) Alien members of the U.S. Armed Forces. An alien member of the 
U.S. Armed Forces in uniform or bearing proper military identification, 
who has not been lawfully admitted for permanent residence, coming to 
the United States under official orders or permit of such Armed Forces 
(Sec. 284, 86 Stat. 232; 8 U.S.C. 1354).
    (b) American Indians born in Canada. An American Indian born in 
Canada, having at least 50 per centum of blood of the American Indian 
race (Sec. 289, 66 Stat. 234; 8 U.S.C. 1359.)
    (c) Aliens entering from Guam, Puerto Rico, or the Virgin Islands. 
An alien departing from Guam, Puerto Rico, or the Virgin Islands of the 
United States, and seeking to enter the continental United States or any 
other place under the jurisdiction of the United States (Sec. 212, 66 
Stat. 188; 8 U.S.C. 1182.)
    (d) Armed Services personnel of a NATO member. Personnel belonging 
to the armed services of a government which is a Party to the North 
Atlantic Treaty and which has ratified the Agreement Between the Parties 
to the North Atlantic Treaty Regarding the Status of Their Forces, 
signed at London on June 19, 1951, and entering the United States under 
Article III of that Agreement pursuant to an individual or collective 
movement order issued by an appropriate agency of the sending state or 
of NATO (TIAS 2846; 4 U.S.T. 1792.)
    (e) Armed Services personnel attached to a NATO headquarters in the 
United States. Personnel attached to a NATO Headquarters in the United 
States set up pursuant to the North Atlantic Treaty, belonging to the 
armed services of a government which is a Party to the Treaty and 
entering the United States in connection with their official duties 
under the provisions of the Protocol on the Status of International 
Military Headquarters Set Up Pursuant to the North Atlantic Treaty (TIAS 
2978; 5 U.S.T. 875.)
    (f) Aliens entering pursuant to International Boundary and Water 
Commission Treaty. All personnel employed either directly or indirectly 
on the construction, operation, or maintenance of works in the United 
States undertaken in accordance with the treaty concluded on February 3, 
1944, between the United States and Mexico regarding the functions of 
the International Boundary and Water Commission, and entering the United 
States temporarily in connection with such employment (59 Stat. 1252; TS 
994.)
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 61 
FR 1835, Jan. 24, 1996]



Sec. 41.2  Waiver by Secretary of State and Attorney General of passport and/or visa requirements for certain categories of nonimmigrants.

    Pursuant to the authority of the Secretary of State and the Attorney 
General under INA 212(d)(4), the passport and/or visa requirements of 
INA 212(a)(7)(B)(i)(I), (i)(II) are waived as specified below for the 
following categories of nonimmigrants:
    (a) Canadian nationals. A passport is not required except after a 
visit outside the Western Hemisphere. A visa is not required.
    (b) Aliens resident in Canada or Bermuda having a common nationality 
with

[[Page 172]]

nationals of Canada or with British subjects in Bermuda. A passport is 
not required except after a visit outside the Western Hemisphere. A visa 
is not required.
    (c) Bahamian nationals and British subjects resident in the Bahamas. 
A passport is required. A visa is not required if, prior to the 
embarkation of such an alien for the United States on a vessel or 
aircraft, the examining U.S. immigration officer at Freeport or Nassau 
determines that the individual is clearly and beyond a doubt entitled to 
admission.
    (d) British subjects resident in the Cayman Islands or in the Turks 
and Caicos Islands. A passport is required. A visa is not required if 
the alien arrives directly from the Cayman Islands or the Turks and 
Caicos Islands and presents a current certificate from the Clerk of 
Court of the Cayman Islands or the Turks and Caicos Islands indicating 
no criminal record.
    (e) British, French, and Netherlands nationals and nationals of 
certain adjacent islands of the Caribbean which are independent 
countries. A passport is required. A visa is not required of a British, 
French or Netherlands national, or of a national of Antigua, Barbados, 
Grenada, Jamaica, or Trinidad and Tobago, who has residence in British, 
French, or Netherlands territory located in the adjacent islands of the 
Caribbean area, or has residence in Antigua, Barbados, Grenada, Jamaica, 
or Trinidad and Tobago, if the alien:
    (1) Is proceeding to the United States as an agricultural worker; or
    (2) Is the beneficiary of a valid, unexpired, indefinite 
certification granted by the Department of Labor for employment in the 
Virgin Islands of the United States and is proceeding thereto for 
employment, or is the spouse or child of such an alien accompanying or 
following to join the alien.
    (f) Nationals and residents of the British Virgin Islands proceeding 
to the Virgin Islands of the United States. A passport is required. A 
visa is not required of a national of the British Virgin Islands who 
resides therein and is proceeding to the Virgin Islands of the United 
States.
    (g) Mexican nationals. (1) A visa and a passport are not required of 
a Mexican national in possession of a border crossing identification 
card and applying for admission as a temporary visitor for business or 
pleasure from contiguous territory.
    (2) A visa is not required of a Mexican national possessing a border 
crossing identification card and applying for admission to the United 
States as a temporary visitor for business or pleasure or in transit 
from noncontiguous territory.
    (3) A visa is not required of a Mexican national employed as a crew 
member on an aircraft belonging to a Mexican company authorized to 
engage in commercial transportation into the United States.
    (4) A visa is not required of a Mexican national bearing a Mexican 
diplomatic or official passport who is a military or civilian official 
of the Federal Government of Mexico entering the United States for a 
stay of up to 6 months for any purpose other than on assignment as a 
permanent employee to an office of the Mexican Federal Government in the 
United States. A visa is also not required of the official's spouse or 
any of the official's dependent family members under 19 years of age who 
hold diplomatic or official passports and are in the actual company of 
the official at the time of entry. This waiver does not apply to the 
spouse or any of the official's family members classifiable under INA 
101(a)(15) (F) or (M).
    (h) Natives and residents of the Trust Territory of the Pacific 
Islands. A visa and a passport are not required of a native and resident 
of the Trust Territory of the Pacific Islands who has proceeded in 
direct and continuous transit from the Trust Territory to the United 
States.
    (i) Aliens in immediate transit without visa (TWOV). A passport and 
visa are not required of an alien in immediate and continuous transit 
through the United States in accordance with the terms of an agreement 
entered into between the carrier and INS on Form I-426, Immediate and 
Continuous Transit Agreement Between a Transportation Line and United 
States of America, pursuant to INA 238(d) to ensure transit through and 
departure from the United States en route to a specified

[[Page 173]]

foreign country. The alien must be in possession of travel documentation 
establishing identity, nationality, and ability to enter a country other 
than the United States. This waiver of visa and passport requirement is 
not available to an alien who is a citizen of Afghanistan, Bangladesh, 
Cuba, India, Iran, Iraq, Libya, Pakistan, Sri Lanka, or a citizen of a 
Republic of the former Socialist Federal Republic of Yugoslavia which 
includes Bosnia, Croatia, Serbia, Montenegro, Slovenia, and Macedonia. 
This waiver of visa and passport requirements is also not available to 
an alien who is a citizen of North Korea (``Democratic Peoples' Republic 
of Korea'') or Vietnam (``Socialist Republic of Vietnam''), and is a 
resident of one of the said countries. It is, on a basis of reciprocity, 
available to a national of Albania, Bulgaria, Czechoslovakia, Estonia, 
the German Democratic Republic, Hungary, Latvia, Lithuania, Mongolian 
People's Republic, People's Republic of China, Poland, Romania, or the 
Union of Soviet Socialist Republic, resident in one of those countries, 
only if he is transiting the United States by aircraft of a 
transportation line signatory to an agreement with the Immigration and 
Naturalization Service on Form 1-426 on a direct through flight which 
will depart directly to a foreign place from the port of arrival.
    (j) Individual cases of unforeseen emergencies. A visa and passport 
are not required of an alien if, either prior to the alien's embarkation 
abroad or upon arrival at a port of entry, the responsible district 
director of the Immigration and Naturalization Service in charge of the 
port of entry concludes that the alien is unable to present the required 
documents because of an unforeseen emergency. Any waiver of the visa or 
passport requirement may be granted by the INS district director 
pursuant to INA 212(d)(4)(A) without the prior concurrence of the 
Department of State in each case in which the district director 
concludes that the alien's claim of emergency circumstances is 
legitimate and bona fide and that approval of the waiver would be 
appropriate under all of the attendant facts and circumstances.
    (k) Fiance(e) of a U.S. citizen. Notwithstanding the provisions of 
paragraphs (a) through (h) of this section, a visa is required of an 
alien described in such paragraphs who is classified, or who seeks 
classification, under INA 101(a)(15)(K).
    (l) Visa waiver pilot program. (1) Notwithstanding the provisions of 
paragraphs (a) through (k) of this section, a visa is not required of 
any person who seeks admission to the United States for a period of 90 
days or less as a visitor for business or pleasure and who is eligible 
to apply for admission to the United States as a Visa Waiver Pilot 
Program applicant.
    (2) Countries designated as pilot program countries under paragraph 
(l)(1), of this section are: the United Kingdom (effective July 1, 
1988); Japan (effective December 15, 1988); France and Switzerland 
(effective July 1, 1989); The Federal Republic of Germany and Sweden 
(effective July 15, 1989); Italy and The Netherlands (effective July 29, 
1989); Andorra, Austria, Belgium, Denmark, Finland, Iceland, 
Liechtenstein, Luxembourg, Monaco, New Zealand, Norway, San Marino, and 
Spain (effective October 1, 1991); Brunei (effective July 29, 1993); 
Ireland (effective April 1, 1995); Argentina (effective July 8, 1996); 
Australia (effective July 29, 1996) and Slovenia (effective September 
30, 1997).
    (m) Treaty Trader and Treaty Investor. Notwithstanding the 
provisions of paragraph (a) of this section, a visa is required of a 
Canadian national who is classified, or who seeks classification, under 
INA 101(a)(15)(E).
[52 FR 42597, Nov. 5, 1987, as amended at 53 FR 9110, Mar. 21, 1988; 53 
FR 50162, Dec. 13, 1988; 53 FR 53375, Dec. 30, 1988; 54 FR 27121, June 
27, 1989; 56 FR 30428, July 2, 1991; 56 FR 46717, Sept. 13, 1991; 58 FR 
40586, July 29, 1993; 58 FR 43439, Aug. 16, 1993; 59 FR 1473, Jan. 11, 
1994; 60 FR 15874, Mar. 28, 1995; 61 FR 35629, July 8, 1996; 61 FR 
39319, July 29, 1996; 62 FR 51031, Sept. 30, 1997]



Sec. 41.3  Waiver by joint action of consular and immigration officers of passport and/or visa requirements.

    Under the authority of INA 212(d)(4), the documentary requirements 
of INA 212(a)(7)(B)(i)(I), (i)(II) may be waived for any alien in whose 
case the consular officer serving the port or place

[[Page 174]]

of embarkation is satisfied after consultation with, and concurrence by, 
the appropriate immigration officer, that the case falls within any of 
the following categories:
    (a) Residents of foreign contiguous territory; visa and passport 
waiver. An alien residing in foreign contiguous territory who does not 
qualify for any waiver provided in Sec. 41.1 and is a member of a 
visiting group or excursion proceeding to the United States under 
circumstances which make it impractical to procure a passport and visa 
in a timely manner.
    (b) Aliens for whom passport extension facilities are unavailable; 
passport waiver. As alien whose passport is not valid for the period 
prescribed in INA 212(a)(7)(B)(i)(I) and who is embarking for the United 
States at a port or place remote from any establishment at which the 
passport could be revalidated.
    (c) Aliens precluded from obtaining passport extensions by foreign 
government restrictions; passport waiver. An alien whose passport is not 
valid for the period prescribed in INA 212(a)(7)(B)(i)(I) and whose 
government, as a matter of policy, does not revalidate passports more 
than 6 months prior to expiration or until the passport expires.
    (d) Emergent circumstances; visa waiver. An alien well and favorably 
known at the consular office, who was previously issued a nonimmigrant 
visa which has expired, and who is proceeding directly to the United 
States under emergent circumstances which preclude the timely issuance 
of a visa.
    (e) Members of armed forces of foreign countries; visa and passport 
waiver. An alien on active duty in the armed forces of a foreign country 
and a member of a group of such armed forces traveling to the United 
States, on behalf of the alien's government or the United Nations, under 
advance arrangements made with the appropriate military authorities of 
the United States. The waiver does not apply to a citizen or resident of 
Cuba, Mongolian People's Republic, North Korea (Democratic People's 
Republic of Korea), Vietnam (Socialist Republic of Vietnam), or the 
People's Republic of China.
    (f) Landed immigrants in Canada; passport waiver. An alien applying 
for a visa at a consular office in Canada:
    (1) Who is a landed immigrant in Canada;
    (2) Whose port and date of expected arrival in the United States are 
known; and
    (3) Who is proceeding to the United States under emergent 
circumstances which preclude the timely procurement of a passport or 
Canadian certificate of identity.
    (g) Authorization to individual consular office; visa and/or 
passport waiver. An alien within the district of a consular office which 
has been authorized by the Department, because of unusual circumstances 
prevailing in that district, to join with immigration officers abroad in 
waivers of documentary requirements in specific categories of cases, and 
whose case falls within one of those categories.
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 60 
FR 30188, June 8, 1995; 61 FR 1835, Jan. 24, 1996]



               Subpart B--Classification of Nonimmigrants



Sec. 41.11  Entitlement to nonimmigrant status.

    (a) Presumption of immigrant status and burden of proof. An 
applicant for a nonimmigrant visa, other than an alien applying for a 
visa under INA 101(a)(15) (H)(i) or (L), shall be presumed to be an 
immigrant until the consular officer is satisfied that the alien is 
entitled to a nonimmigrant status described in INA 101(a)(15) or 
otherwise established by law or treaty. The burden of proof is upon the 
applicant to establish entitlement for nonimmigrant status and the type 
of nonimmigrant visa for which application is made.
    (b) Aliens unable to establish nonimmigrant status. (1) A 
nonimmigrant visa shall not be issued to an alien who has failed to 
overcome the presumption of immigrant status established by INA 214(b).
    (2) In a borderline case in which an alien appears to be otherwise 
entitled to receive a visa under INA 101(a)(15)(B) or (F) but the 
consular officer concludes that the maintenance of the alien's status or 
the departure of the

[[Page 175]]

alien from the United States as required is not fully assured, a visa 
may nevertheless be issued upon the posting of a bond with the Attorney 
General under terms and conditions prescribed by the consular officer.
[52 FR 42597, Nov. 5, 1987, as amended at 61 FR 1835, Jan. 24, 1996]



Sec. 41.12  Classification symbols.

    A visa issued to a nonimmigrant alien within one of the classes 
described in this section shall bear an appropriate visa symbol to show 
the classification of the alien. The symbol shall be inserted in the 
space provided in the visa stamp. The following visa symbols shall be 
used:

                              Nonimmigrants                             
------------------------------------------------------------------------
      Symbol                Class                  Section of law       
------------------------------------------------------------------------
A-1...............  Ambassador, Public     101(a)(15)(A)(i).            
                     Minister, Career                                   
                     Diplomat or Consular                               
                     Officer, or                                        
                     Immediate Family.                                  
A-2...............  Other Foreign          101(a)(15)(A)(ii).           
                     Government Official                                
                     or Employee, or                                    
                     Immediate Family.                                  
A-3...............  Attendant, Servant,    101(a)(15)(A)(iii).          
                     or Personal Employee                               
                     of A-1 or A-2, or                                  
                     Immediate Family.                                  
B-1...............  Temporary Visitor for  101(a)(15)(B).               
                     Business.                                          
B-2...............  Temporary Visitor for  101(a)(15)(B).               
                     Pleasure.                                          
B-1/B-2...........  Temporary Visitor for  101(a)(15)(B).               
                     Business & Pleasure.                               
C-1...............  Alien in Transit.....  101(a)(15)(C).               
C-2...............  Alien in Transit to    101(a)(15)(C).               
                     United Nations                                     
                     Headquarters                                       
                     District Under Sec.                                
                     11.(3), (4), or (5)                                
                     of the Headquarters                                
                     Agreement.                                         
C-3...............  Foreign Government     212(d)(8).                   
                     Official, Immediate                                
                     Family, Attendant,                                 
                     Servant or Personal                                
                     Employee, in Transit.                              
D.................  Crewmember (Sea or     101(a)(15)(D).               
                     Air).                                              
E-1...............  Treaty Trader, Spouse  101(a)(15)(E)(i).            
                     or Child.                                          
E-2...............  Treaty Investor,       101(a)(15)(E)(ii).           
                     Spouse or Child.                                   
F-1...............  Student..............  101(a)(15)(F)(i).            
F-2...............  Spouse or Child of F-  101(a)(15)(F)(ii).           
                     1.                                                 
G-1...............  Principal Resident     101(a)(15)(G)(i).            
                     Representative of                                  
                     Recognized Foreign                                 
                     Government to                                      
                     International                                      
                     Organization, Staff,                               
                     or Immediate Family.                               
G-2...............  Other Representative   101(a)(15)(G)(ii).           
                     of Recognized                                      
                     Foreign Member                                     
                     Government to                                      
                     International                                      
                     Organization, or                                   
                     Immediate Family.                                  
G-3...............  Representative of      101(a)(15)(G)(iii).          
                     Nonrecognized                                      
                     Nonmember Foreign                                  
                     Government to                                      
                     International                                      
                     Organization, or                                   
                     Immediate Family.                                  
G-4...............  International          101(a)(15)(G)(iv).           
                     Organization Officer                               
                     or Employee, or                                    
                     Immediate Family.                                  
G-5...............  Attendant, Servant,    101(a)(15)(G)(v).            
                     or Personal Employee                               
                     of G-1 through G-4                                 
                     or Immediate Family.                               
H-1A..............  Registered Nurse.....  101(a)(15)(H)(i)(a).         
H-1B..............  Alien in a Specialty   101(a)(15)(H)(i)(b).         
                     Occupation                                         
                     (Profession).                                      
H-2A..............  Temporary Worker       101(a)(15)(H)(ii)(a).        
                     Performing                                         
                     Agricultural                                       
                     Services Unavailable                               
                     In the United States                               
                     (Petition filed on                                 
                     or After June 1,                                   
                     1987).                                             
H-2B..............  Temporary Worker       101(a)(15)(H)(ii)(b).        
                     Performing Other                                   
                     Services Unavailable                               
                     in the United States                               
                     (Petition filed on                                 
                     or After June 1,                                   
                     1987).                                             
H-3...............  Trainee..............  101(a)(15)(H)(iii).          
H-4...............  Spouse or Child of     101(a)(15)(H)(iv).           
                     Alien Classified H-                                
                     1A/B, H2A/B, or H-3.                               
I.................  Representative of      101(a)(15)(I).               
                     Foreign Information                                
                     Media, Spouse and                                  
                     Child.                                             
J-1...............  Exchange Visitor.....  101(a)(15)(J).               
J-2...............  Spouse or Child of J-  101(a)(15)(J).               
                     1.                                                 
K-1...............  Fiance(e) of United    101(a)(15)(K).               
                     States Citizen.                                    
K-2...............  Child of Fiance(e) of  101(a)(15)(K).               
                     U.S. Citizen.                                      
L-1...............  Intracompany           101(a)(15)(L).               
                     Transferee                                         
                     (Executive,                                        
                     Managerial, and                                    
                     Specialized                                        
                     Knowledge Personnel                                
                     Continuing                                         
                     Employment with                                    
                     International Firm                                 
                     or Corporation.                                    
L-2...............  Spouse or Child of     101(a)(15)(L).               
                     Intracompany                                       
                     Transferee.                                        
M-1...............  Vocational Student or  101(a)(15)(M).               
                     Other Nonacademic                                  
                     Student.                                           
M-2...............  Spouse or Child of M-  101(a)(15)(M).               
                     1.                                                 
N-8...............  Parent of an Alien     101(a)(15)(N)(i).            
                     Classified SK-3                                    
                     Special Immigrant.                                 
N-9...............  Child of N-8 or of an  101(a)(15)(N)(ii).           
                     SK-1, SK-2, or SK-4                                
                     Special Immigrant.                                 
NATO-1............  Principal Permanent    Art. 12, 5 UST 1094;         
                     Representative of     Art. 20, 5 UST 1098.         
                     Member State to NATO                               
                     (including any of                                  
                     its Subsidiary                                     
                     Bodies) Resident in                                
                     the U.S. and                                       
                     Resident Members of                                
                     Official Staff;                                    
                     Secretary General,                                 
                     Assistant Secretary                                
                     General, and                                       
                     Executive Secretary                                
                     of NATO; Other                                     
                     Permanent NATO                                     
                     Officials of Similar                               
                     Rank, or Immediate                                 
                     Family.                                            

[[Page 176]]

                                                                        
NATO-2............  Other Representative   Art. 13, 5 UST 1094;         
                     of member state to    Art. 1, 4 UST 1794.          
                     NATO (including any                                
                     of Subsidiary                                      
                     Bodies) including                                  
                     Representatives, its                               
                     Advisers and                                       
                     Technical Experts of                               
                     Delegations, Members                               
                     of Immediate Art. 3,                               
                     4 UST 1796 Family;                                 
                     Dependents of Member                               
                     of a Force Entering                                
                     in Accordance with                                 
                     the Provisions                                     
                     Status-of-Forces                                   
                     Agreement or in                                    
                     Accordance with the                                
                     provisions of the                                  
                     Protocol on the                                    
                     Status of                                          
                     International                                      
                     Military                                           
                     Headquarters;                                      
                     Members of Such a                                  
                     Force if Issued                                    
                     Visas.                                             
NATO-3............  Official Clerical      Art. 14, 5 UST 1096.         
                     Staff Accompanying                                 
                     Representative of                                  
                     Member State to NATO                               
                     (including any of                                  
                     its Subsidiary                                     
                     Bodies) or Immediate                               
                     Family.                                            
NATO-4............  Official of NATO       Art. 18, 5 UST 1098.         
                     (Other Than Those                                  
                     Classifiable as NATO-                              
                     1) or Immediate                                    
                     Family.                                            
NATO-5............  Expert, Other Than     Art. 21, 5 UST 1100.         
                     NATO Officials                                     
                     Classifiable Under                                 
                     the NATO-4, Employed                               
                     in Missions on                                     
                     Behalf of NATO, and                                
                     their Dependents.                                  
NATO-6............  Member of a Civilian   Art. 1, 4 UST 1794;          
                     Component             Art. 3, 5 UST 877.           
                     Accompanying a Force                               
                     Entering in                                        
                     Accordance with the                                
                     Provisions of the                                  
                     NATO Status-of-                                    
                     Forces Agreement;                                  
                     Member of a Civilian                               
                     Component Attached                                 
                     to or Employed by an                               
                     Allied Headquarters                                
                     Under the Protocol                                 
                     on the Status of                                   
                     International                                      
                     Military                                           
                     Headquarters Set Up                                
                     Pursuant to the                                    
                     North Atlantic                                     
                     Treaty; and their                                  
                     Dependents.                                        
NATO-7............  Attendant, Servant,    Art. 12-20;                  
                     or Personal Employee  5 UST 1094-1098.             
                     of NATO-1, NATO-2,                                 
                     NATO-3, NATO-4, NATO-                              
                     5, and NATO-6                                      
                     Classes, or                                        
                     Immediate Family.                                  
O-1...............  Alien with             101(a)(15)(O)(i).            
                     Extraordinary                                      
                     Ability in Sciences,                               
                     Arts, Education,                                   
                     Business or                                        
                     Athletics.                                         
O-2...............  Accompanying Alien...  101(a)(15)(O)(ii).           
O-3...............  Spouse or Child of O-  101(a)(15)(O)(iii).          
                     1 or O-2.                                          
P-1...............  Internationally        101(a)(15)(P)(i).            
                     Recognized Athlete                                 
                     or Member of                                       
                     Internationally                                    
                     Recognized                                         
                     Entertainment Group.                               
P-2...............  Artist or Entertainer  101(a)(15)(P)(ii).           
                     in a Reciprocal                                    
                     Exchange Program.                                  
P-3...............  Artist or Entertainer  101(a)(15)(P)(iii).          
                     in a Culturally                                    
                     Unique Program.                                    
P-4...............  Spouse or Child of P-  101(a)(15)(P)(iv).           
                     1, P-2, or P-3.                                    
Q-1...............  Participant in an      101(a)(15)(Q).               
                     International                                      
                     Cultural Exchange                                  
                     Program.                                           
R-1...............  Alien in a Religious   101(a)(15)(R).               
                     Occupation.                                        
R-2...............  Spouse or Child of R-  101(a)(15)(R).               
                     1.                                                 
S-7...............  Certain Aliens         101(a)(15)(S)(i).            
                     Supplying Critical                                 
                     Information Relating                               
                     to a Criminal                                      
                     Organization or                                    
                     Enterprise.                                        
S-8...............  Certain Aliens         101(a)(15)(S)(ii).           
                     Supplying Critical                                 
                     Information Relating                               
                     to Terrorism.                                      
TN................  NAFTA Professional...  214(e)(2).                   
TD................  Spouse or Child of     214(e)(2).                   
                     NAFTA Professional.                                
------------------------------------------------------------------------

[60 FR 10497, Feb. 27, 1995; as amended at 61 FR 1836, Jan. 24, 1996]



                 Subpart C--Foreign Government Officials



Sec. 41.21  General.

    (a) Definitions. In addition to pertinent INA definitions, the 
following definitions are applicable:
    (1) Accredited, as used in INA 101(a)(15)(A), 101(a)(15)(G), and 
212(d)(8), means an alien holding an official position, other than an 
honorary official position, with a government or international 
organization and possessing a travel document or other evidence of 
intention to enter or transit the United States to transact official 
business for that government or international organization.
    (2) Attendants, as used in INA 101(a)(15)(A)(iii), 101(a)(15)(G)(v), 
and 212(d)(8), and in the definition of the NATO-7 visa symbol, means 
aliens paid from the public funds of a foreign government or from the 
funds of an international organization, accompanying or following to 
join the principal alien to whom a duty or service is owed.
    (3) Immediate family, as used in INA 101(a)(15)(A), 101(a)(15)(G), 
and 212(d)(8), and in classification under the NATO-1 through NATO-5 
visa symbols, means the spouse and unmarried sons and daughters, whether 
by blood or adoption, who are not members of some other household, and 
who will reside regularly in the household of the principal alien. 
``Immediate family'' also includes any other close relatives of the 
principal alien or spouse who:
    (i) Are relatives of the principal alien or spouse by blood, 
marriage, or adoption;
    (ii) Are not members of some other household;

[[Page 177]]

    (iii) Will reside regularly in the household of the principal alien;
    (iv) Are recognized as dependents by the sending Government as 
demonstrated by eligibility for rights and benefits, such as the 
issuance of a diplomatic or official passport and travel and other 
allowances, which would be granted to the spouse and children of the 
principal alien; and
    (v) Are individually authorized by the Department.
    (4) Servants and personal employees, as used in INA 
101(a)(15)(A)(iii), 101(a)(15)(G)(v), and 212(d)(8), and in 
classification under the NATO-7 visa symbol, means aliens employed in a 
domestic or personal capacity by a principal alien, who are paid from 
the private funds of the principal alien and seek to enter the United 
States solely for the purpose of such employment.
    (b) Exception to passport validity requirement for aliens in certain 
A, G, and NATO classes. A nonimmigrant alien for whom the passport 
requirement of INA 212(a)(7)(B)(i)(I) has not been waived and who is 
within one of the classes:
    (1) Described in INA 101(a)(15)(A)(i) and (ii); or
    (2) Described in INA 101(a)(15)(G)(i), (ii), (iii), and (iv); or
    (3) NATO-1, NATO-2, NATO-3, NATO-4, or NATO-6 may present a passport 
which is valid only for a sufficient period to enable the alien to apply 
for admission at a port of entry prior to its expiration.
    (c) Exception to passport validity requirement for foreign 
government officials in transit. An alien classified C-3 under INA 
212(d)(8) needs to present only a valid unexpired visa and a travel 
document which is valid for entry into a foreign country for at least 30 
days from the date of application for admission into the United States.
    (d) Grounds for refusal of visas applicable to certain A, C, G, and 
NATO classes. (1) An A-1 or A-2 visa may not be issued to an alien the 
Department has determined to be persona non grata.
    (2) Only the provisions of INA 212(a) cited below apply to the 
indicated classes of nonimmigrant visa applicants:
    (i) Class A-1: INA 212(a) (3)(A), (3)(B), and (3)(C);
    (ii) Class A-2: INA 212(a) (3)(A), (3)(B), and (3)(C);
    (iii) Classes C-2 and C-3: INA 212(a) (3)(A), (3)(B), (3)(C), and 
(7)(B);
    (iv) Classes G-1, G-2, G-3, and G-4: INA 212(a) (3)(A), (3)(B), and 
(3)(C);
    (v) Classes NATO-1, NATO-2, NATO-3, NATO-4, and NATO-6: INA 212(a) 
(3)(A), (3)(B), and (3)(C);
    (3) An alien within class A-3 or G-5 is subject to all grounds of 
refusal specified in INA 212 which are applicable to nonimmigrants in 
general.
[52 FR 42597, Nov. 5, 1987; 53 FR 9111, Mar. 21, 1988, as amended at 56 
FR 30428, July 2, 1991]



Sec. 41.22  Officials of foreign governments.

    (a) Criteria for classification of foreign government officials. (1) 
An alien is classifiable A-1 or A-2 under INA 101(a)(15)(A) (i) or (ii) 
if the principal alien:
    (i) Has been accredited by a foreign government recognized de jure 
by the United States;
    (ii) Intends to engage solely in official activities for that 
foreign government while in the United States; and
    (iii) Has been accepted by the President, the Secretary of State, or 
a consular officer acting on behalf of the Secretary of State.
    (2) A member of the immediate family of a principal alien is 
classifiable A-1 or A-2 under INA 101(a)(15)(A) (i) or (ii) if the 
principal alien is so classified.
    (b) Classification under INA 101(a)(15)(A). An alien entitled to 
classification under INA 101(a)(15)(A) shall be classified under this 
section even if eligible for another nonimmigrant classification.
    (c) Classification of attendants, servants, and personal employees. 
An alien is classifiable as a nonimmigrant under INA 101(a)(15)(A)(iii) 
if the consular officer is satisfied that the alien qualifies under 
those provisions.
    (d) Referral to the Department of special cases concerning principal 
alien applicants. In any case in which there is uncertainty about the 
applicability of these regulations to a principal alien applicant 
requesting such nonimmigrant status, the matter shall be immediately 
referred to the Department for consideration as to whether

[[Page 178]]

acceptance of accreditation will be granted.
    (e) Change of classification to that of a foreign government 
official. In the case of an alien in the United States seeking a change 
of nonimmigrant classification under INA 248 to a classification under 
INA 101(a)(15)(A) (i) or (ii), the question of acceptance of 
accreditation is determined by the Department.
    (f) Termination of status. The Department may, in its discretion, 
cease to recognize as entitled to classification under INA 101(a)(15)(A) 
(i) or (ii) any alien who has nonimmigrant status under that provision.
    (g) Classification of foreign government official. A foreign 
government official or employee seeking to enter the United States 
temporarily other than as a representative or employee of a foreign 
government is not classifiable under the provisions of INA 
101(a)(15)(A).
    (h) Courier and acting courier on official business--(1) Courier of 
career. An alien regularly and professionally employed as a courier by 
the government of the country to which the alien owes allegiance is 
classifiable as a nonimmigrant under INA 101(a)(15)(A)(i), if the alien 
is proceeding to the United States on official business for that 
government.
    (2) Official acting as courier. An alien not regularly and 
professionally employed as a courier by the government of the country to 
which the alien owes allegiance is classifiable as a nonimmigrant under 
INA 101(a)(15)(A)(ii), if the alien is holding an official position and 
is proceeding to the United States as a courier on official business for 
that government.
    (3) Nonofficial serving as courier. An alien serving as a courier 
but not regularly and professionally employed as such who holds no 
official position with, or is not a national of, the country whose 
government the alien is serving, shall be classified as a nonimmigrant 
under INA 101(a)(15)(B).
    (i) Official of foreign government not recognized by the United 
States. An official of a foreign government not recognized de jure by 
the United States, who is proceeding to or through the United States on 
an official mission or to an international organization shall be 
classified as a nonimmigrant under INA 101(a)(15) (B), (C), or (G)(iii).



Sec. 41.23  Accredited officials in transit.

    An accredited official of a foreign government intending to proceed 
in immediate and continuous transit through the United States on 
official business for that government is entitled to the benefits of INA 
212(d)(8) if that government grants similar privileges to officials of 
the United States, and is classifiable C-3 under the provisions of INA 
101(a)(15)(C). Members of the immediate family, attendants, servants, or 
personal employees of such an official receive the same classification 
as the principal alien.



Sec. 41.24  International organization aliens.

    (a) Definition of international organization. ``International 
organization,'' means any public international organization which has 
been designated by the President by Executive Order as entitled to enjoy 
the privileges, exemptions, and immunities provided for in the 
International Organizations Immunities Act. (59 Stat. 669)
    (b) Aliens coming to international organizations. (1) An alien is 
classifiable under INA 101(a)(15)(G) if the consular officer is 
satisfied that the alien is within one of the classes described in that 
section and seeks to enter or transit the United States in pursuance of 
official duties. If the purpose of the entry or transit is other than 
pursuance of official duties, the alien is not classifiable under INA 
101(a)(15)(G).
    (2) An alien applying for a visa under the provisions of INA 
101(a)(15)(G) may not be refused solely on the grounds that the 
applicant is not a national of the country whose government the 
applicant represents.
    (3) An alien seeking to enter the United States as a foreign 
government representative to an international organization, who is also 
proceeding to the United States on official business as a foreign 
government official within the meaning of INA 101(a)(15)(A), shall be 
issued a visa under that section, if otherwise qualified.

[[Page 179]]

    (4) An alien not classifiable under INA 101(a)(15)(A) but entitled 
to classification under INA 101(a)(15)(G) shall be classified under the 
latter section, even if also eligible for another nonimmigrant 
classification.



Sec. 41.25  NATO representatives, officials, and employees.

    (a) Classification. An alien shall be classified under the symbol 
NATO-1, NATO-2, NATO-3, NATO-4, or NATO-5 if the consular officer is 
satisfied that the alien is seeking admission to the United States under 
the applicable provision of the Agreement on the Status of the North 
Atlantic Treaty Organization, National Representatives and International 
Staff, or is a member of the immediate family of an alien classified 
NATO-1 through NATO-5. (See Sec. 41.12 for classes of aliens entitled to 
classification under each symbol.)
    (b) Armed services personnel. Armed services personnel entering the 
United States in accordance with the provisions of the Agreement Between 
the Parties to the North Atlantic Treaty Regarding the Status of Their 
Forces or in accordance with the provisions of the Protocol on the 
Status of International Military Headquarters Set Up Pursuant to the 
North Atlantic Treaty may enter the United States under the appropriate 
treaty waiver of documentary requirements contained in Sec. 41.1 (d) or 
(e). If a visa is issued it is classifiable under the NATO-2 symbol.
    (c) Dependents of armed services personnel. Dependents of armed 
services personnel referred to in paragraph (b) of this section shall be 
classified under the symbol NATO-2.
    (d) Members of civilian components and dependents. Alien members of 
a civilian component accompanying a force entering in accordance with 
the provisions of the NATO Status-of-Forces Agreement, and dependents, 
or alien members of a civilian component attached to or employed by an 
Allied Headquarters under the Protocol on the Status of International 
Military Headquarters, and dependents shall be classified under the 
symbol NATO-6.
    (e) Attendant, servant, or personal employee of an alien classified 
NATO-1 through NATO-6. An alien attendant, servant, or personal employee 
of an alien classified NATO-1 through NATO-6, and any member of the 
immediate family of such attendant, servant, or personal employee, shall 
be classified under the symbol NATO-7.



Sec. 41.26  Diplomatic visas.

    (a) Definitions. (1) Diplomatic passport means a national passport 
bearing that title and issued by a competent authority of a foreign 
government.
    (2) Diplomatic visa means any nonimmigrant visa, regardless of 
classification, which bears that title and is issued in accordance with 
the regulations of this section.
    (3) Equivalent of a diplomatic passport means a national passport, 
issued by a competent authority of a foreign government which does not 
issue diplomatic passports to its career diplomatic and consular 
officers, indicating the career diplomatic or consular status of the 
bearer.
    (b) Place of application. With the exception of certain aliens in 
the United States issued nonimmigrant visas by the Department under the 
provisions of Sec. 41.111(b), application for a diplomatic visa shall be 
made at a diplomatic mission or at a consular office authorized to issue 
diplomatic visas, regardless of the nationality or residence of the 
applicant.
    (c) Classes of aliens eligible to receive diplomatic visas. (1) A 
nonimmigrant alien who is in possession of a diplomatic passport or its 
equivalent shall, if otherwise qualified, be eligible to receive a 
diplomatic visa irrespective of the classification of the visa under 
Sec. 41.12 if within one of the following categories:
    (i) Heads of states and their alternates;
    (ii) Members of a reigning royal family;
    (iii) Governors-general, governors, high commissioners, and similar 
high administrative or executive officers of a territorial unit, and 
their alternates;
    (iv) Cabinet ministers and their assistants holding executive or 
administrative positions not inferior to that of the head of a 
departmental division, and their alternates;
    (v) Presiding officers of chambers of national legislative bodies;

[[Page 180]]

    (vi) Justices of the highest national court of a foreign country;
    (vii) Ambassadors, public ministers, other officers of the 
diplomatic service and consular officers of career;
    (viii) Military officers holding a rank not inferior to that of a 
brigadier general in the United States Army or Air Force and Naval 
officers holding a rank not inferior to that of a rear admiral in the 
United States Navy;
    (ix) Military, naval, air and other attache and assistant attache 
assigned to a foreign diplomatic mission;
    (x) Officers of foreign-government delegations to international 
organizations so designated by Executive Order;
    (xi) Officers of foreign-government delegations to, and officers of, 
international bodies of an official nature, other than international 
organizations so designated by Executive Order;
    (xii) Officers of a diplomatic mission of a temporary character 
proceeding to or through the United States in the performance of their 
official duties;
    (xiii) Officers of foreign-government delegations proceeding to or 
from a specific international conference of an official nature;
    (xiv) Members of the immediate family of a principal alien who is 
within one of the classes described in paragraphs (c)(1)(i) to 
(c)(1)(xi) inclusive, of this section;
    (xv) Members of the immediate family accompanying or following to 
join the principal alien who is within one of the classes described in 
paragraphs (c)(1)(xii) and (c)(1)(xiii) of this section;
    (xvi) Diplomatic couriers proceeding to or through the United States 
in the performance of their official duties.
    (2) Aliens Classifiable G-4, who are otherwise qualified, are 
eligible to receive a diplomatic visa if accompanying these officers:
    (i) The Secretary General of the United Nations;
    (ii) An Under Secretary General of the United Nations;
    (iii) An Assistant Secretary General of the United Nations;
    (iv) The Administrator or the Deputy Administrator of the United 
Nations Development Program;
    (v) An Assistant Administrator of the United Nations Development 
Program;
    (vi) The Executive Director of the:
    (A) United Nation's Children's Fund;
    (B) United Nations Institute for Training and Research;
    (C) United Nations Industrial Development Organization;
    (vii) The Executive Secretary of the:
    (A) United Nations Economic Commission for Africa;
    (B) United Nations Economic Commission for Asia and the Far East;
    (C) United Nations Economic Commission for Latin America;
    (D) United Nations Economic Commission for Europe;
    (viii) The Secretary General of the United Nations Conference on 
Trade and Development;
    (ix) The Director General of the Latin American Institute for 
Economic and Social Planning;
    (x) The United Nations High Commissioner for Refugees;
    (xi) The United Nations Commissioner for Technical Cooperation;
    (xii) The Commissioner General of the United Nations Relief and 
Works Agency for Palestine Refugees in the Near East;
    (xiii) The spouse or child of any nonimmigrant alien listed in 
paragraphs (c)(2)(i) through (c)(2)(xii) of this section.
    (3) Other individual aliens or classes of aliens are eligible to 
receive diplomatic visas upon authorization of the Department, the Chief 
of a U.S. Diplomatic Mission, the Deputy Chief of Mission, the Counselor 
for Consular Affairs or the principal officer of a consular post not 
under the jurisdiction of a diplomatic mission.
[52 FR 42597, Nov. 5, 1987; 53 FR 9111, Mar. 21, 1988]



Sec. 41.27  Official visas.

    (a) Definition. Official visa means any nonimmigrant visa, 
regardless of classification, which bears that title and is issued in 
accordance with these regulations.
    (b) Place of application. Official visas are ordinarily issued only 
when application is made in the consular district of the applicant's 
residence. When directed by the Department, or in the discretion of the 
consular officer, official visas may be issued when application is made 
in a consular district in which the alien is physically present

[[Page 181]]

but does not reside. Certain aliens in the United States may be issued 
official visas by the Department under the provisions of Sec. 41.111(b).
    (c) Classes of aliens eligible to receive official visas. (1) A 
nonimmigrant within one of the following categories who is not eligible 
to receive a diplomatic visa shall, if otherwise qualified, be eligible 
to receive an official visa irrespective of classification of the visa 
under Sec. 41.12:
    (i) Aliens within a class described in Sec. 41.26(c)(2) who are 
ineligible to receive a diplomatic visa because they are not in 
possession of a diplomatic passport or its equivalent;
    (ii) Aliens classifiable under INA 101(a)(15)(A);
    (iii) Aliens, other than those described in Sec. 41.26(c)(3) who are 
classifiable under INA 101(a)(15)(G), except those classifiable under 
INA 101(a)(15)(G)(iii) unless the government of which the alien is an 
accredited representative is recognized de jure by the United States;
    (iv) Aliens classifiable under INA 101(a)(15)(C) as nonimmigrants 
described in INA 212(d)(8);
    (v) Members and members-elect of national legislative bodies;
    (vi) Justices of the lesser national and the highest state courts of 
a foreign country;
    (vii) Officers and employees of national legislative bodies 
proceeding to or through the United States in the performance of their 
official duties;
    (viii) Clerical and custodial employees attached to foreign-
government delegations to, and employees of, international bodies of an 
official nature, other than international organizations so designated by 
Executive Order, proceeding to or through the United States in the 
performance of their official duties;
    (ix) Clerical and custodial employees attached to a diplomatic 
mission of a temporary character proceeding to or through the United 
States in the performance of their official duties;
    (x) Clerical and custodial employees attached to foreign-government 
delegations proceeding to or from a specific international conference of 
an official nature;
    (xi) Officers and employees of foreign governments recognized de 
jure by the United States who are stationed in foreign contiguous 
territories or adjacent islands;
    (xii) Members of the immediate family, attendants, servants and 
personal employees of, when accompanying or following to join, a 
principal alien who is within one of the classes referred to or 
described in paragraphs (c)(1)(i) through (c)(1)(xi) inclusive of this 
section;
    (xiii) Attendants, servants and personal employees accompanying or 
following to join a principal alien who is within one of the classes 
referred to or described in paragraphs (c)(1)(i) through (c)(1)(xiii) 
inclusive of Sec. 41.26(c)(2).
    (2) Other individual aliens or classes of aliens are eligible to 
receive official visas upon the authorization of the Department, the 
Chief of a U.S. Diplomatic Mission, the Deputy Chief of Mission, the 
Counselor for Consular Affairs, or the principal officer of a consular 
post not under the jurisdiction of a diplomatic mission.
[52 FR 42597, Nov. 5, 1987; 53 FR 9111, Mar. 21, 1988]



                      Subpart D--Temporary Visitors



Sec. 41.31  Temporary visitors for business or pleasure.

    (a) Classification. An alien is classifiable as a nonimmigrant 
visitor for business (B-1) or pleasure (B-2) if the consular officer is 
satisfied that the alien qualifies under the provisions of INA 
101(a)(15)(B), and that:
    (1) The alien intends to leave the United States at the end of the 
temporary stay (consular officers are authorized, if departure of the 
alien as required by law does not seem fully assured, to require the 
posting of a bond with the Attorney General in a sufficient sum to 
ensure that at the end of the temporary visit, or upon failure to 
maintain temporary visitor status, or any status subsequently acquired 
under INA 248, the alien will depart from the United States);
    (2) The alien has permission to enter a foreign country at the end 
of the temporary stay; and

[[Page 182]]

    (3) Adequate financial arrangements have been made to enable the 
alien to carry out the purpose of the visit to and departure from the 
United States.
    (b) Definitions. (1) The term ``business,'' as used in INA 
101(a)(15)(B), refers to conventions, conferences, consultations and 
other legitimate activities of a commercial or professional nature. It 
does not include local employment or labor for hire. For the purposes of 
this section building or construction work, whether on-site or in plant, 
shall be deemed to constitute purely local employment or labor for hire; 
provided that the supervision or training of others engaged in building 
or construction work (but not the actual performance of any such 
building or construction work) shall not be deemed to constitute purely 
local employment or labor for hire if the alien is otherwise qualified 
as a B-1 nonimmigrant. An alien seeking to enter as a nonimmigrant for 
employment or labor pursuant to a contract or other prearrangement is 
required to qualify under the provisions of Sec. 41.53. An alien of 
distinguished merit and ability seeking to enter the United States 
temporarily with the idea of performing temporary services of an 
exceptional nature requiring such merit and ability, but having no 
contract or other prearranged employment, may be classified as a 
nonimmigrant temporary visitor for business.
    (2) The term pleasure, as used in INA 101(a)(15)(B), refers to 
legitimate activities of a recreational character, including tourism, 
amusement, visits with friends or relatives, rest, medical treatment, 
and activities of a fraternal, social, or service nature.
[52 FR 42597, Nov. 5, 1987; 53 FR 9172, Mar. 21, 1988]



Sec. 41.32  Nonresident alien Mexican border crossing identification cards; combined border crossing identification cards and B-1/B-2 visitor visa.

    (a) Border crossing identification cards (BCC)--(1) Posts authorized 
to issue. Consular officers assigned to consular offices in Ciudad 
Juarez, Hermosillo, Nuevo Laredo, Matamoros, and Tijuana may issue a 
nonresident alien border crossing identification card (BCC), as that 
term is defined in INA 101(a)(6), to a nonimmigrant alien who:
    (i) Is a citizen and resident of Mexico; and
    (ii) Is a temporary visitor who, if applying for a B-1 or B-2 
visitor visa for business or pleasure, would be eligible to receive such 
visa.
    (2) Procedures for application. A citizen of Mexico shall apply for 
a BCC on Form OF-156, Nonimmigrant Visa Application. The application 
shall be supported by:
    (i) Evidence of Mexican citizenship and residence;
    (ii) A valid or expired Mexican Federal passport or a valid Mexican 
identity document (Form FM13); and
    (iii) One photograph (1-\1/2\-inches square), if the alien is 16 
years of age or older. Each applicant shall appear in person before a 
consular officer and be interviewed regarding eligibility for a 
temporary visitor visa, unless personal appearance is waived by the 
officer.
    (3) Issuance and format. A Mexican BCC shall consist of a stamp 
placed in the alien's valid or expired Mexican Federal passport or valid 
Mexican identity document by a consular officer stationed at one of the 
posts designated in paragraph (a)(1) of this section. The stamps shall 
be numbered serially by each consular office beginning with the number 
``1'' on October 1 of each year. They must be in the format prescribed 
by the Department and contain the following data:
    (i) Post symbol;
    (ii) Number of the card;
    (iii) Title and location of the issuing office;
    (iv) Date of issuance;
    (v) Name(s) of the person(s) to whom issued; and
    (vi) Signature and title of the issuing officer.
    (b) Combined border crossing identification cards and B-1/B-2 
visitor visas (B-1/B-2--BCC)--(1) Posts authorized to issue. Consular 
officers assigned to any consular office in Mexico may issue a 
nonresident alien border crossing identification card, as that term is 
defined in INA 101(a)(6), in combination with a B-1/B-2 nonimmigrant 
visitor vias (B-1/B-2--BCC, to a nonimmigrant alien who:
    (i) Is a citizen of Mexico;

[[Page 183]]

    (ii) Seeks to enter the United States as a temporary visitor for 
business or pleasure as defined in INA 101(a)(15)(B) for periods of stay 
not exceeding 6 months; and
    (iii) Is otherwise eligible to receive a B-1 or B-2 temporary 
visitor visa or is the beneficiary of a waiver under INA 212(d)(3)(A) of 
a ground of ineligibility, which is valid for multiple applications for 
admission into the United States and for an indefinite period of time 
and which contains no restrictions as to extensions of temporary stay or 
itinerary.
    (2) Procedure for application. Application for a B-1/B-2--BCC may be 
made by a Mexican applicant at any U.S. consular office in Mexico on 
Form OF-156. The application shall be supported by:
    (i) Evidence of Mexican citizenship and residence;
    (ii) A valid Mexican Federal passport; and
    (iii) One photograph (1-\1/2\-inches square), if 16 years of age or 
older.

Each applicant shall appear in person before a consular officer to be 
interviewed regarding eligibility for a visitor visa, unless personal 
appearance is waived by the consular officer.
    (3) Issuance and format. A Mexican B-1/B-2--BCC shall consist of a 
numbered stamp placed in the alien's valid Mexican Federal passport by a 
consular officer in Mexico. The stamps shall be numbered serially by 
each consular office beginning with the number ``1'' on October 1 of 
each year. They must be in the format prescribed by the Department and 
contain the following data:
    (i) Post symbol;
    (ii) Number of the card;
    (iii) Title and location of the issuing office;
    (iv) Date of issuance;
    (v) Indicia ``Mexican Border Crossing Identification Card and B-1/B-
2 Nonimmigrant Visa'';
    (vi) Name(s) of the person(s) to whom issued;
    (vii) Caption ``Valid indefinitely for multiple applications for 
admission to the United States as a temporary visitor for business or 
pleasure'' in the middle portion of the stamp; and
    (viii) Signature and title of the issuing officer.
    (c) Validity. A Mexican BCC or B-1/B-2--BCC, issued pursuant to the 
provisions of this section, is valid until revoked. A BCC previously 
issued by a consular officer in Mexico on Form I-186, Nonresident Alien 
Mexican Border Crossing Card, or Form I-586, Nonresident Alien Border 
Crossing Card, is valid until revoked or voided, regardless of any 
expiration date on the card.
    (d) Revocation. A Mexican BCC or B-1/B-2--BCC may be revoked under 
the provisions of Sec. 41.122. Upon revocation, the consular or 
immigration officer shall cancel the card by writing or stamping the 
word ``Canceled'' plainly acoss the face of the card stamp and shall 
indicate the location of the consular or immigration office where the 
card was revoked.
    (e) Voidance of Mexican border crossing cards issued in Mexico on 
form I-186 or form I-586. A consular officer in Mexico may declare void, 
without notice, a BCC previously issued in Mexico on Form I-186 or Form 
I-586, upon a finding that the holder is ineligible to receive a 
nonimmigrant visas. The card must be surrendered immediately upon 
voidance.
    (f) Replacement. When a Mexican BCC or B-1/B-2--BCC issued under the 
provisions of this section has been lost, mutilated, or destroyed, the 
person to whom such card was issued may apply for a new card as provided 
in this section. A nonresident alien whose BCC previously issued on Form 
I-186 or Form I-586 by a consular officer in Mexico, has been lost, 
mutilated, or destroyed, may apply for a B-1/B-2--BCC at any consular 
office in Mexico, provided the alien qualifies under paragraph (b) of 
this section.
[52 FR 42597, Nov. 5, 1987; 53 FR 9111, Mar. 21, 1988]



Sec. 41.33  Nonresident alien Canadian border crossing identification card (BCC).

    (a) Aliens eligible to apply. A consular officer assigned to a 
consular office in Canada may issue a nonresident alien border crossing 
identification care (BCC), as that term is defined in INA 101(a)(6), to 
a nonimmigration alien who:

[[Page 184]]

    (1) Has been admitted to Canada for permanent residence as a landed 
immigrant;
    (2) Seeks to enter the United States from Canada, or will seek to 
enter the United States from Mexico and will not have visited any 
countries other than Mexico and the United States since departing 
Canada, only as a temporary visitor for business or pleasure as defined 
in INA 101(a)(15)(B) for periods of stay not exceeding 6 months; and
    (3) Is otherwise eligible to receive a temporary visitor visa or is 
the beneficiary of a waiver under INA 212(d)(3)(A) of a ground of 
ineligibility, which is valid for multiple applications for admission 
into the United States and for an indefinite period of time and which 
contains no restrictions as to extensions of temporary stay or 
itinerary.
    (b) Procedure for application. Application for a Canadian BCC shall 
be made on Form OF-156, Nonimmigrant Visa Application. The application 
shall be supported by:
    (1) Evidence of the applicant's landed immigrant status in Canada;
    (2) A valid or expired passport or other travel document showing 
origin, identity, and nationality, if any; and
    (3) One photograph (1\1/2\ inches square), if the applicant is 16 
years of age or over. Each applicant must appear in person before a 
consular officer and be interviewed regarding eligibility for a visitor 
visa unless personal appearance is waived by the consular officer.
    (c) Issuance and format of border crossing identification card. A 
Canadian BCC shall consist of a stamp placed in the alien's passport or 
other travel document by a consular officer in Canada. The stamps shall 
be numbered serially by each consular office beginning with the number 
``1'' on October 1 of each year. They shall be in the format prescribed 
by the Department and contain the following data:
    (1) Post symbol;
    (2) Number of the card;
    (3) Title and location of the issuing office;
    (4) Date of issuance;
    (5) Name(s) of the person(s) to whom issued; and
    (6) Signature and title of the issuing officer.
    (d) Validity of Canadian BCC. A Canadian BCC, issued pursuant to the 
provisions of this section, is valid until revoked.
    (e) Revocation of Canadian BCC. (1) A Canadian BCC shall be revoked 
by a consular officer if information is developed indicating that the 
holder is ineligible to receive a nonimmigrant visa, or by a District 
Director of the Immigration and Naturalization Service if it is found 
that the alien has violated the conditions of admission into the United 
States.
    (2) In canceling such a card the consular or immigration officer 
shall write or stamp the word ``Canceled'' plainly across the face of 
the card stamp, indicate the location of the consular or immigration 
office where the card was revoked and follow the procedures of 
Sec. 41.122.



                 Subpart E--Crewman and Crew-List Visas



Sec. 41.41  Crewmen.

    (a) Alien classifiable as crewman. An alien shall be classifiable as 
a nonimmigrant crewman upon establishing to the satisfaction of the 
consular officer the qualifications prescribed by INA 101(a)(15)(D) 
provided that the alien has permission to enter some foreign country 
after a temporary landing in the United States.
    (b) Alien not classifiable as crewman. An alien employed on board a 
vessel or aircraft in a capacity not required for normal operation and 
service, or an alien employed or listed as a regular member of the crew 
in excess of the number normally required, shall not be classified as a 
crewman.



Sec. 41.42  Crew-list visas.

    (a) Definition. A crew-list visa is a nonimmigrant visa issued on a 
manifest of crewmen of a vessel or aircraft and includes all aliens 
listed in the manifest unless otherwise stated. It constitutes a valid 
nonimmigrant visa within the meaning of INA 212(a)(7)(B)(i)(II).
    (b) Application. (1) A list of all alien crewmen serving on a vessel 
or aircraft proceeding to the United States and

[[Page 185]]

not in possession of a valid individual D visa or INS Form I-151, Alien 
Registration Receipt Card, shall be submitted in duplicate to a consular 
officer on INS Form I-418, Passenger List--Crew List, or other 
prescribed forms. The duplicate copy of Form I-418 must show in column 
(4) the date, city, and country of birth of each person listed and in 
column (5) the place of issuance and the issuing authority of the 
passport held by that person. For aircraft crewmen, the manifest issued 
by the International Civil Aviation Organization (ICAO) or Customs Form 
7507, General Declaration, may be used in lieu of Form I-418 if there is 
adequate space for the list of names.
    (2) The formal application for a crew-list visa is the crew list 
together with any other information the consular officer finds necessary 
to determine eligibility. No other application form is required.
    (3) The crew list submitted should contain in alphabetical order the 
names of those alien crew members to be considered for inclusion in a 
crew-list visa. If the list is not alphabetical, the consular officer 
may require a separate alphabetical listing if this will not unduly 
delay the departure of the vessel or aircraft.
    (4) If a vessel or aircraft destined to the United States will not 
call at a port or place where there is a consular office, the crew list 
can be submitted for visaing to a consular office at the place nearest 
the vessel's port of call.
    (c) Fee. A fee in an amount determined by the Schedule of Fees for 
Consular Services shall be charged for a crew-list visa except that no 
fee shall be charged in the case of an American vessel or aircraft.
    (d) Validity. A crew-list visa is valid for a period of 6 months 
from the date of issuance and for a single application for admission 
into the United States.
    (e) Procedure in issuing. (1) In issuing a crew-list visa the 
regular nonimmigrant visa stamp as prescribed in Sec. 41.113(d) shall be 
placed on the last page of the manifest immediately following the last 
name listed.
    (2) The symbol D shall be inserted in the space provided in the visa 
stamp.
    (3) The name of the vessel or identifying data regarding the 
aircraft shall be entered in the space provided for the name of the visa 
recipient.
    (4) The signature and title of the consular officer shall be 
recorded on the visa. The post impression seal shall be affixed on the 
visa stamp if the visa has been stamped by a rubber handstamp.
    (5) When a crew-list visa is issued, the consular officer delivers 
the original of the document to the master of the vessel or captain of 
the aircraft or to an authorized agent for presentation to the 
immigration officer at the first port of arrival in the U.S. The dated 
duplicate copy is retained for the consular files.
    (f) Supplemental crew-list visas. (1) A supplemental crew-list visa 
shall be issued at the consular office at which the crew-list visa was 
issued or at another consular office to cover any crewman signed on 
after the issuance of the crew-list visa and not in possession of a 
valid individual D visa.
    (2) If the crewman is substituted for another member previously 
included in the visa, the substitution shall be indicated in the 
supplemental crew list presented for visaing.
    (g) Exclusion from and refusal of, crew-list visas--(1) Exclusion 
from crew-list visa. If there is reason to believe that a crew list 
submitted for visaing contains the name of any person who is not a bona 
fide crewman or who is otherwise ineligible to receive an individual D 
visa under INA 101(a)(15)(D), the consular officer shall exclude any 
such person from the visa by listing the name of each excluded crew 
member below the visa stamp. An excluded crew member's name may not be 
stricken from the crew list.
    (2) Refusal of crew-list visa. A crew-list visa shall be refused if 
all aliens listed thereon are found by the consular officer not to be 
bona fide crewmen or otherwise ineligible to receive individual visas as 
crew members. In any case where a crew-list visa is refused, a full 
report shall be forwarded to reach the Department before the arrival of 
the vessel or aircraft at the first port of entry. In any case of 
refusal the original crew list shall be returned to the master, aircraft 
captain, or authorized

[[Page 186]]

agent, and the duplicate shall be filed in the consular office.
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 61 
FR 1836, Jan. 24, 1996]



                   Subpart F--Business and Media Visas



Sec. 41.51  Treaty trader or treaty investor.

    (a) Treaty trader. An alien is classifiable as a nonimmigrant treaty 
trader (E-1) if the consular officer is satisfied that the alien 
qualifies under the provisions of INA 101(a)(15)(E)(i) and that the 
alien:
    (1) Will be in the United States solely to carry on trade of a 
substantial nature, which is international in scope, either on the 
alien's behalf or as an employee of a foreign person or organization 
engaged in trade, principally between the United States and the foreign 
state of which the alien is a national, (consideration being given to 
any conditions in the country of which the alien is a national which may 
affect the alien's ability to carry on such substantial trade); and
    (2) Intends to depart from the United States upon the termination of 
E-1 status.
    (b) Treaty investor. An alien is classifiable as a nonimmigrant 
treaty investor (E-2) if the consular officer is satisfied that the 
alien qualifies under the provisions of INA 101(a)(15)(E)(ii) and that 
the alien:
    (1) Has invested or is actively in the process of investing a 
substantial amount of capital in bona fide enterprise in the United 
States, as distinct from a relatively small amount of capital in a 
marginal enterprise solely for the purpose of earning a living; and
    (2) Is seeking entry solely to develop and direct the enterprise; 
and
    (3) Intends to depart from the United States upon the termination of 
E-2 status.
    (c) Employee of treaty trader or treaty investor. An alien employee 
of a treaty trader may be classified E-1 and an alien employee of a 
treaty investor may be classified E-2 if the employee is in or is coming 
to the United States to engage in duties of an executive or supervisory 
character, or, if employed in a lesser capacity, the employee has 
special qualifications that make the services to be rendered essential 
to the efficient operation of the enterprise. The employer must be:
    (1) A person having the nationality of the treaty country, who is 
maintaining the status of treaty trader or treaty investor if in the 
United States or if not in the United States would be classifiable as a 
treaty trader or treaty investor; or
    (2) An organization at least 50% owned by persons having the 
nationality of the treaty country who are maintaining nonimmigrant 
treaty trader or treaty investor status if residing in the United States 
or if not residing in the United States who would be classifiable as 
treaty traders or treaty investors.
    (d) Spouse and children of treaty trader or treaty investor. The 
spouse and children of a treaty trader or treaty investor accompanying 
or following to join the principal alien are entitled to the same 
classification as the principal alien. The nationality of a spouse or 
child of a treaty trader or treaty investor is not material to the 
classification of the spouse or child under the provisions of INA 
101(a)(15)(E).
    (e) Representative of foreign information media. Representatives of 
foreign information media shall first be considered for possible 
classification as nonimmigrants under the provisions of INA 
101(a)(15)(I), before consideration is given to their possible 
classification as nonimmigrants under the provisions of INA 
101(a)(15)(E) and of this section.
    (f) Treaty country. A treaty country is for purposes of this section 
a foreign state with which a qualifying Treaty of Friendship, Commerce, 
and Navigation or its equivalent exists with the United States. A treaty 
country includes a foreign state that is accorded treaty visa privileges 
under INA 101(a)(15)(E) by specific legislation (other than the INA).
    (g) Nationality of the treaty country. The nationality of an 
individual treaty trader or treaty investor is determined by the 
authorities of the foreign state of which the alien claims nationality.

[[Page 187]]

In the case of an organization, ownership must be traced as best as is 
practicable to the individuals who ultimately own the organization.
    (h) Trade. The term ``trade'' as used in this section means the 
existing international exchange of items of trade for consideration 
between the United States and the treaty country. Existing trade 
includes successfully negotiated contracts binding upon the parties 
which call for the immediate exchange of items of trade. This exchange 
must be traceable and identifiable. Title to the trade item must pass 
from one treaty party to the other.
    (i) Item of trade. Items which qualify for trade within these 
provisions include but are not limited to goods, services, technology, 
monies, international banking, insurance, transportation, tourism, 
communications, and some news gathering activities.
    (j) Substantial trade. Substantial trade for the purposes of this 
section entails the quantum of trade sufficient to ensure a continuous 
flow of trade items between the United States and the treaty country. 
This continuous flow contemplates numerous exchanges over time rather 
than a single transaction, regardless of the monetary value. Although 
the monetary value of the trade item being exchanged is a relevant 
consideration, greater weight is given to more numerous exchanges of 
larger value. In the case of smaller businesses, an income derived from 
the value of numerous transactions which is sufficient to support the 
treaty trader and his or her family constitutes a favorable factor in 
assessing the existence of substantial trade.
    (k) Principal trade. Trade shall be considered to be principal trade 
between the United States and the treaty country when over 50% of the 
volume of international trade of the treaty trader is conducted between 
the United States and the treaty country of the treaty trader's 
nationality.
    (l) Investment. Investment means the treaty investor's placing of 
capital, including funds and other assets, at risk in the commercial 
sense with the objective of generating a profit. The treaty investor 
must be in possession of and have control over the capital invested or 
being invested. The capital must be subject to partial or total loss if 
investment fortunes reverse. Such investment capital must be the 
investor's unsecured personal business capital or capital secured by 
personal assets. Capital in the process of being invested or that has 
been invested must be irrevocably committed to the enterprise. The alien 
has the burden of establishing such irrevocable commitment given to the 
particular circumstances of each case. The alien may use any legal 
mechanism available, such as by placing invested funds in escrow pending 
visa issuance, that would not only irrevocably commit funds to the 
enterprise but that might also extend some personal liability protection 
to the treaty investor.
    (m) Bona fide enterprise. The enterprise must be a real and active 
commercial or entrepreneurial undertaking, producing some service or 
commodity for profit and must meet applicable legal requirements for 
doing business in the particular jurisdiction in the United States.
    (n) Substantial amount of capital. A substantial amount of capital 
constitutes that amount that is:
    (1)(i) Substantial in the proportional sense, i.e., in relationship 
to the total cost of either purchasing an established enterprise or 
creating the type of enterprise under consideration;
    (ii) Sufficient to ensure the treaty investor's financial commitment 
to the successful operation of the enterprise; and
    (iii) Of a magnitude to support the likelihood that the treaty 
investor will successfully develop and direct the enterprise.
    (2) Whether an amount of capital is substantial in the 
proportionality sense is understood in terms of an inverted sliding 
scale; i.e., the lower the total cost of the enterprise, the higher, 
proportionately, the investment must be to meet these criteria.
    (o) Marginal enterprise. A marginal enterprise is an enterprise that 
does not have the present or future capacity to generate more than 
enough income to provide a minimal living for the treaty investor and 
his or her family. An enterprise that does not have the capacity to 
generate such income but that has a present or future capacity to

[[Page 188]]

make a significant economic contribution is not a marginal enterprise. 
The projected future capacity should generally be realizable within five 
years from the date the alien commences normal business activity of the 
enterprise.
    (p) Solely to develop and direct. The business or individual treaty 
investor does or will develop and direct the enterprise by controlling 
the enterprise through ownership of at least 50% of the business, by 
possessing operational control through a managerial position or other 
corporate device, or by other means.
    (q) Executive or supervisory character. The executive or supervisory 
element of the employee's position must be a principal and primary 
function of the position and not an incidental or collateral function. 
Executive and/or supervisory duties grant the employee ultimate control 
and responsibility for the enterprise's overall operation or a major 
component thereof.
    (1) An executive position provides the employee great authority to 
determine policy of and direction for the enterprise.
    (2) A position primarily of supervisory character grants the 
employee supervisory responsibility for a significant proportion of an 
enterprise's operations and does not generally involve the direct 
supervision of low-level employees.
    (r) Special qualifications. Special qualifications are those skills 
and/or aptitudes that an employee in a lesser capacity brings to a 
position or role that are essential to the successful or efficient 
operation of the enterprise.
    (1) The essential nature of the alien's skills to the employing firm 
is determined by assessing the degree of proven expertise of the alien 
in the area of operations involved, the uniqueness of the specific skill 
or aptitude, the length of experience and/or training with the firm, the 
period of training or other experience necessary to perform effectively 
the projected duties, and the salary the special qualifications can 
command. The question of special skills and qualifications must be 
determined by assessing the circumstances on a case-by-case basis.
    (2) Whether the special qualifications are essential will be 
assessed in light of all circumstances at the time of each visa 
application on a case-by-case basis. A skill that is unique at one point 
may become commonplace at a later date. Skills required to start up an 
enterprise may no longer be essential after initial operations are 
complete and are running smoothly. Some skills are essential only in the 
short-term for the training of locally-hired employees. Long-term 
essentiality might, however, be established in connection with 
continuous activities in such areas as product improvement, quality 
control, or the provision of a service not generally available in the 
United States.
    (s) Labor disputes. Citizens of Canada or Mexico shall not be 
entitled to classification under this section if the Attorney General 
and the Secretary of Labor have certified that:
    (1) There is in progress a strike or lockout in the course of a 
labor dispute in the occupational classification at the place or 
intended place of employment; and
    (2) The alien has failed to establish that the aliens entry will not 
affect adversely the settlement of the strike or lockout or the 
employment of any person who is involved in the strike or lockout.
[62 FR 48154, Sept. 12, 1997]



Sec. 41.52  Information media representative.

    (a) Representative of foreign press, radio, film, or other 
information media. An alien is classifiable as a nonimmigrant 
information media representative if the consular officer is satisfied 
that the alien qualifies under the provisions of INA 101(a)(15)(I) and 
is a representative of a foreign press, radio, film, or other 
information medium having its home office in a foreign country, the 
government of which grants reciprocity for similar privileges to 
representatives of such a medium having home offices in the United 
States.
    (b) Classification when applicant eligible for both I visa and E 
visa. An alien who will be engaged in foreign information media 
activities in the United States and meets the criteria set forth in 
paragraph (a) of this section shall be classified as a nonimmigrant 
under

[[Page 189]]

INA 101(a)(15)(I) even if the alien may also be classifiable as a 
nonimmigrant under the provisions of INA 101(a)(15)(E).
    (c) Spouse and children of information media representative. The 
spouse or child of an information media representative is classifiable 
under INA 101(a)(15)(I) if accompanying or following to join the 
principal alien.



Sec. 41.53  Temporary workers and trainees.

    (a) Requirements for H classification. An alien shall be 
classifiable under INA 101(a)(15)(H) if:
    (1) The consular officer is satisfied that the alien qualifies under 
that section; and either
    (2) With respect to the principal alien, the consular officer has 
received official evidence of the approval by INS of a petition to 
accord such classification or of the extension by INS of the period of 
authorized entry in such classification; or
    (3) The consular officer is satisfied the alien is the spouse or 
child of an alien so classified and is accompanying or following to join 
the principal alien.
    (b) Petition approval. The approval of a petition by the Immigration 
and Naturalization Service does not establish that the alien is eligible 
to receive a nonimmigrant visa.
    (c) Validity of visa. The period of validity of a visa issued on the 
basis of paragraph (a) to this section must not exceed the period 
indicated in the petition, notification, or confirmation required in 
paragraph (a)(2) of this section.
    (d) Alien not entitled to H classification. The consular officer 
must suspend action on this alien's application and submit a report to 
the approving INS office if the consular officer knows or has reason to 
believe that an alien applying for a visa under INA 101(a)(15)(H) is not 
entitled to the classification as approved.
    (e) ``Trainee'' defined. The term Trainee, as used in INA 
101(a)(15)(H)(iii), means a nonimmigrant alien who seeks to enter the 
United States temporarily at the invitation of an individual, 
organization, firm, or other trainer for the purpose of receiving 
instruction in any field of endeavor (other than graduate medical 
education or training), including agriculture, commerce, communication, 
finance, government, transportation, and the professions.
    (f) Former exchange visitor. Former exchange visitors who are 
subject to the 2-year residence requirement of INA 212(e) are ineligible 
to apply for visas under INA 101(a)(15)(H) until they have fulfilled the 
residence requirement or obtained a waiver of the requirement.
[57 FR 31449, July 16, 1992; as amended at 61 FR 1833, Jan. 24, 1996]



Sec. 41.54  Intracompany transferees (executives, managers, and specialists).

    (a) Requirements for L classification. An alien shall be 
classifiable under the provisions of INA 101(a)(15)(L) if:
    (1) The consular officer is satisfied that the alien qualifies under 
that section; and either
    (2) In the case of an individual petition, the consular officer has 
received official evidence of the approval by INS of a petition to 
accord such classification or of the extension by INS of the period of 
authorized stay in such classification; or
    (3) In the case of a blanket petition, the alien has presented to 
the consular officer official evidence of the approval by INS of a 
blanket petition
    (i) listing only those intracompany relationships and positions 
found to qualify under INA 101(a)(15)(L) or
    (ii) to accord such classification to qualified aliens who are being 
transferred to qualifying positions identified in such blanket petition; 
or
    (4) The consular officer is satisfied the alien is the spouse or 
child of an alien so classified and is accompanying or following to join 
the principal alien.
    (b) Petition approval. The approval of a petition by INS does not 
establish that the alien is eligible to receive a nonimmigrant visa.
    (c) Validity of visa. (1) The period of validity of a visa issued on 
the basis of paragraph (a) to this section must not exceed the period 
indicated in the petition, notification, or confirmation required in 
paragraph (a)(2)(i) or (ii) of this section.
    (2) The period of validity of a visa issued on the basis of 
paragraph (a) to this section is not limited to the period

[[Page 190]]

of validity indicated in the blanket petition, notification, or 
confirmation required in paragraphs (a)(2)(iii) or (iv) of this section.
    (d) Alien not entitled to L-1 classification under individual 
petition. The consular officer must suspend action on the alien's 
application and submit a report to the approving INS office if the 
consular officer knows or has reason to believe that an alien applying 
for a visa as the beneficiary of an approved individual petition under 
INA 101(a)(15)(L) is not entitled to such classification as approved.
    (e) Labor disputes. Citizens of Canada or Mexico shall not be 
entitled to classification under this section if the Attorney General 
and the Secretary of Labor have certified that:
    (1) There is in progress a strike or lockout in the course of a 
labor dispute in the occupational classification at the place or 
intended place of employment; and
    (2) The alien has failed to establish that the alien's entry will 
not affect adversely the settlement of the strike or lockout or the 
employment of any person who is involved in the strike or lockout.
    (f) Alien not entitled to L-1 classification under blanket petition. 
The consular officer shall deny L classification based on a blanket 
petition if the documentation presented by the alien claiming to be a 
beneficiary thereof does not establish to the satisfaction of the 
consular officer that
    (1) The alien has been continuously employed by the same employer, 
an affiliate or a subsidiary thereof, for 1 year within the 3 years 
immediately preceding the application for the L visa;
    (2) The alien was occupying a qualifying position throughout that 
year; or
    (3) The alien is destined to a qualifying position identified in the 
petition and in an organization listed in the petition.
    (g) Former exchange visitor. Former exchange visitors who are 
subject to the 2-year foreign residence requirement of INA 212(e) are 
ineligible to apply for visas under INA 101(a)(15)(L) until they have 
fulfilled the residence requirement or obtained a waiver of the 
requirement.
[57 FR 31449, July 16, 1992, as amended at 58 FR 68527, Dec. 28, 1993; 
61 FR 1833, Jan. 24, 1996]



Sec. 41.55  Aliens with extraordinary ability.

    (a) Requirements for O classification. An alien shall be 
classifiable under the provisions of INA 101(a)(15)(O) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and either
    (2) With respect to the principal alien, the consular officer has 
received official evidence of the approval by INS of a petition to 
accord such classification or of the extension by INS of the period of 
authorized stay in such classification; or
    (3) The consular officer is satisfied the alien is the spouse or 
child of an alien so classified and is accompanying or following to join 
the principal alien.
    (b) Approval of visa. The approval of a petition by INS does not 
establish that the alien is eligible to receive a nonimmigrant visa.
    (c) Validity of visa. The period of validity of a visa issued on the 
basis of paragraph (a) to this section must not exceed the period 
indicated in the petition, notification, or confirmation required in 
paragraph (a)(2) of this section.
    (d) Alien not entitled to O classification. The consular officer 
must suspend action on the alien's application and submit a report to 
the approving INS office if the consular officer knows or has reason to 
believe that an alien applying for a visa under INA 101(a)(15)(O) is not 
entitled to the classification as approved.
[57 FR 31450, July 16, 1992; as amended at 61 FR 1833, Jan. 24, 1996]



Sec. 41.56  Athletes, artists and entertainers.

    (a) Requirements for P classification. An alien shall be 
classifiable under the provisions of INA 101(a)(15)(P) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and either
    (2) With respect to the principal alien, the consular officer has 
received official evidence of the approval by INS

[[Page 191]]

of a petition to accord such classification or of the extension by INS 
of the period of authorized stay in such classification; or
    (3) The consular officer is satisfied the alien is the spouse or 
child of an alien so classified and is accompanying or following to join 
the principal alien.
    (b) Approval of visa. The approval of a petition by INS does not 
establish that the alien is eligible to receive a nonimmigrant visa.
    (c) Validity of visa. The period of validity of a visa issued on the 
basis of paragraph (a) to this section must not exceed the period 
indicated in the petition, confirmation, or extension of stay required 
in paragraph (a)(2) of this section.
    (d) Alien not entitled to P classification. The consular officer 
must suspend action on the alien's application and submit a report to 
the approving INS office if the consular officer knows or has reason to 
believe that an alien applying for a visa under INA 101(a)(15)(P) is not 
entitled to the classification as approved.
[57 FR 31450, July 16, 1992; as amended at 61 FR 1833, Jan. 24, 1996]



Sec. 41.57  International cultural exchange visitors.

    (a) Requirements for Q classification. An alien shall be 
classifiable under the provisions of INA 101(a)(15)(Q) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and
    (2) The consular officer has received official evidence of the 
approval by INS of a petition or the extension by INS of the period of 
authorized stay in such classification.
    (b) Approval of petition. The approval of a petition by INS does not 
establish that the alien is eligible to receive a nonimmigrant visa.
    (c) Validity of visa. The period of validity of a visa issued on the 
basis of paragraph (a) of this section must not exceed the period 
indicated in the petition, notification, or confirmation required in 
paragraph (a)(2) of this section.
    (d) Alien not entitled to Q classification. The consular officer 
must suspend action on the alien's application and submit a report to 
the approving INS office if the consular officer knows or has reason to 
believe that an alien applying for a visa under INA 101(a)(15)(Q) is not 
entitled to the classification as approved.
[57 FR 31450, July 16, 1992; as amended at 61 FR 1833, Jan. 24, 1996]



Sec. 41.58  Aliens in religious occupations.

    (a) Requirements for ``R'' classification. An alien shall be 
classifiable under the provisions of INA 101(a)(15)(R) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and
    (2) The alien, for the 2 years immediately preceding the time of 
application for admission, has been a member of a religious denomination 
having a bona fide nonprofit, religious organization in the United 
States; and
    (3) The alien seeks to enter the United States solely for the 
purpose of
    (i) Carrying on the vocation of a minister of that religious 
denomination, or
    (ii) At the request of the organization, working in a professional 
capacity in a religious vocation or occupation for that organization, or
    (iii) At the request of the organization, working in a religious 
vocation or occupation for the organization, or for a bona fide 
organization which is affiliated with the religious denomination 
described in section 501(c)(3) of the Internal Revenue Code of 1986; and
    (4) The alien is seeking to enter the United States for a period not 
to exceed 5 years to perform the activities described in paragraph (3) 
of this section; or
    (5) The alien is the spouse or child of an alien so classified and 
is accompanying or following to join the principal alien.
    (b) Religious denomination. A religious denomination is a religious 
group or community of believers. Among the factors that may be 
considered in determining whether a group constitutes a bona fide 
religious denomination are the presence of some form of ecclesiastical 
government, a recognized creed and form of worship, a formal code of 
doctrine and discipline, religious services and ceremonies, established 
places of religious worship, and religious congregations. For purposes 
of this definition, an interdenominational religious

[[Page 192]]

organization which is exempt from taxation pursuant to section 501(c)(3) 
of the Internal Revenue Code of 1986 will be treated as a religious 
denomination.
    (c) Bona fide nonprofit religious organization in the United States. 
For purposes of this section, a bona fide nonprofit religious 
organization is an organization exempt from taxation as described in 
section 501(c)(3) of the Internal Revenue Code of 1986, as it relates to 
religious organizations, or one that has never sought such exemption but 
establishes to the satisfaction of the consular officer that it would be 
eligible therefore if it had applied for tax exempt status.
    (d) Bona fide organization which is affiliated with the religious 
denomination. A bona fide organization affiliated with the religious 
denomination is an organization which is both closely associated with 
the religious denomination and exempt from taxation as described in 
section 501(c)(3) of the Internal Revenue Code of 1986, as it relates to 
religious organizations.
    (e) Minister of religion. A minister is an individual who is duly 
authorized by a recognized religious denomination to conduct religious 
worship and to perform other duties usually performed by authorized 
members of the clergy of that religion. A minister does not include a 
lay preacher who is not authorized to perform such duties. In all cases, 
there must be a reasonable connection between the activities performed 
and the religious calling of a minister.
    (f) Professional capacity. Working in a professional capacity means 
engaging in an activity in a religious vocation or occupation which is 
defined by INA 101(a)(32) or for which the minimum of a United States 
baccalaureate degree or a foreign equivalent degree is required for 
entry into that field of endeavor.
    (g) Religious occupation. A religious occupation is the habitual 
employment or engagement in an activity which relates to a traditional 
religious function. Examples of individuals in religious occupations 
include, but are not limited to liturgical workers, religious 
instructors, religious counselors, cantors, catechists, workers in 
religious hospitals or religious health care facilities, missionaries, 
religious translators, or religious broadcasters. This group does not 
include janitors, maintenance workers, clerks, fund raisers, or persons 
solely involved in the solicitation of donations.
    (h) Religious vocation. A religious vocation is a calling to 
religious life evidenced by the demonstration of commitment practiced in 
the religious denomination, such as the taking of vows. Examples of 
individuals with a religious vocation include, but are not limited to 
nuns, monks, and religious brothers and sisters.
    (i) Alien not entitled to classification under INA 101(a)(15)(R). An 
alien who has spent 5 years in the United States under INA 101(a)(15)(R) 
is not entitled to classification and visa issuance under that section 
unless the alien has resided and been physically present outside the 
United States, except for brief visits to the United States for business 
or pleasure, for the immediate prior year.
[60 FR 42036, Aug. 15, 1995]



Sec. 41.59  Professionals under the North American Free Trade Agreement.

    (a) Requirements for classification as a NAFTA professional. An 
alien shall be classifiable under the provisions of INA 214(e) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and
    (2) In the case of citizens of Mexico, the consular officer has 
received from INS an approved petition according classification as a 
NAFTA Professional to the alien or official confirmation of such 
petition approval, or INS confirmation of the alien's authorized stay in 
such classification; or
    (3) In the case of citizens of Canada, the alien shall have 
presented to the consular officer sufficient evidence of an offer of 
employment in the United States requiring employment of a person in a 
professional capacity consistent with NAFTA Chapter 16 Annex 1603 
Appendix 1603.D.1 and sufficient evidence that the alien possesses the 
credentials of that profession as listed in said appendix; or

[[Page 193]]

    (4) The alien is the spouse or child of an alien so classified and 
is accompanying or following to join the principal alien.
    (b) Visa validity. The period of validity of a visa issued pursuant 
to paragraph (a) of this section may not exceed the period indicated in 
the petition, notification, or confirmation required in paragraph (a)(2) 
of this section. The approval of a petition by INS does not establish 
that the alien is eligible to receive a nonimmigrant visa. The period of 
validity of a visa issued pursuant to subparagraph (a)(3) of this 
section may not exceed the period established on a reciprocal basis.
    (c) Temporary entry. Temporary entry means an entry into the United 
States without the intent to establish permanent residence. The alien 
must satisfy the consular officer that the proposed stay is temporary. A 
temporary period has a reasonable, finite end that does not equate to 
permanent residence. The circumstances surrounding an application should 
reasonably and convincingly indicate that the alien's temporary work 
assignment in the United States will end predictably and that the alien 
will depart upon completion of the assignment.
    (d) Labor disputes. Citizens of Canada or Mexico shall not be 
entitled to classification under this section if the Attorney General 
and the Secretary of Labor have certified that:
    (1) There is in progress a strike or lockout in the course of a 
labor dispute in the occupational classification at the place or 
intended place of employment; and
    (2) The alien has failed to establish that the alien's entry will 
not affect adversely the settlement of the strike or lockout or the 
employment of any person who is involved in the strike or lockout.
[58 FR 68527, Dec. 28, 1993, as amended at 63 FR 10305, Mar. 3, 1998]



                Subpart G--Students and Exchange Visitors



Sec. 41.61  Students--academic and nonacademic.

    (a) Definitions--(1) Academic, in INA 101(a)(15)(F), refers to an 
established college, university, seminary, conservatory, academic high 
school, elementary school, or other academic institution, or a language 
training program.
    (2) Nonacademic, in INA 101(a)(15)(M), refers to an established 
vocational or other recognized nonacademic institution (other than a 
language training program).
    (b) Classification. (1) An alien is classifiable under INA 101(a) 
(15) (F) (i) of INA 101(a) (15) (M) (i) if the consular officer is 
satisfied that the alien qualifies under one of those sections, and:
    (i) The alien has been accepted for attendance solely for the 
purpose of pursuing a full course of study in an academic institution 
approved by the Attorney General for foreign students under INA 101(a) 
(15) (F) (i) or a nonacademic institution approved under INA 101(a) (15) 
(M) (i), as evidenced by submission of a Form I-20A-B, Certificate of 
Eligibility For Nonimmigrant (F-1) Student Status -- For Academic and 
Language Students, or Form I-20M-N, Certificate of Eligibility for 
Nonimmigrant (M-1) Student Status--For Vocational Students, properly 
completed and signed by the alien and a designated school official;
    (ii) The alien possesses sufficient funds to cover expenses while in 
the United States or can satisfy the consular officer that other 
arrangements have been made to meet those expenses;
    (iii) The alien, unless coming to participate exclusively in an 
English language training program, has sufficient knowledge of the 
English language to undertake the chosen course of study or training. If 
the alien's knowledge of English is inadequate, the consular officer may 
nevertheless find the alien so classifiable if the accepting institution 
offers English language training, and has accepted the alien expressly 
for a full course of study in a language with which the alien is 
familiar, or will enroll the alien in a combination of courses and 
English instruction which will constitute a full course of study; and
    (iv) The alien intends, and will be able, to depart upon termination 
of student status.
    (2) An alien otherwise qualified for classification as a student, 
who intends

[[Page 194]]

to study the English language exclusively, may be classified as a 
student under INA 101(a) (15) (F) (i) even though no credits are given 
by the accepting institution for such study. The accepting institution, 
however, must offer a full course of study in the English language and 
must accept the alien expressly for such study.
    (3) The alien spouse and minor children of an alien who has been or 
will be issued a visa under INA 101(a) (15) (F) (i) or 101(a) (15) (M) 
(i) may receive nonimmigrant visas under INA 101(a) (15) (F) (ii) or 
101(a) (15) (M) (ii) if the consular officer is satisfied that they will 
be accompanying or following to join the principal alien; that 
sufficient funds are available to cover their expenses in the United 
States; and, that they intend to leave the United States upon the 
termination of the status of the principal alien.
    (c) Posting of bond. In borderline cases involving an alien 
otherwise qualified for classification under INA 101(a) (15) (F), the 
consular officer is authorized to require the posting of a bond with the 
Attorney General in a sum sufficient to ensure that the alien will 
depart upon the conclusion of studies or in the event of failure to 
maintain student status.



Sec. 41.62  Exchange visitors.

    (a) J-1 classification. An alien is classifiable as an exchange 
visitor if qualified under the provisions of INA 101(a) (15) (J) and the 
consular officer is satisfied that the alien:
    (1) Has been accepted to participate, and intends to participate, in 
an exchange visitor program designed by the United States Information 
Agency as evidenced by the presentation of a properly executed Form IAP-
66, Certificate of Eligibility for Exchange Visitor (J-1) Status;
    (2) Has sufficient funds to cover expenses or has made other 
arrangements to provide for expenses;
    (3) Has sufficient knowledge of the English language to undertake 
the program for which selected, or, except for an alien coming to 
participate in a graduate medical education or training program, the 
sponsoring organization is aware of the language deficiency and has 
nevertheless indicated willingness to accept the alien; and
    (4) Meets the requirements of INA 212(j) if coming to participate in 
a graduate medical education or training program.
    (b) J-2 Classification. The spouse or minor child of an alien 
classified J-1 is classifiable J-2.
    (c) Applicability of INA 212(e). (1) An alien is subject to the 2-
year foreign residence requirement of INA 212(e) if:
    (i) The alien's participation in one or more exchange programs was 
wholly or partially financed, directly or indirectly, by the U.S. 
Government or by the government of the alien's country of nationality or 
last residence; or
    (ii) At the time of the issuance of an exchange visitor visa and 
admission to the United States, or, if not required to obtain a 
nonimmigrant visa, at the time of admission as an exchange visitor, or 
at the time of acquisition of such status after admission, the alien is 
a national and resident or, if not a national, a lawful permanent 
resident (or has status equivalent thereto) of a country which the 
Director of the United States Information Agency has designated, through 
publication by public notice in the Federal Register, as clearly 
requiring the services of persons engaged in the field of specialized 
knowledge or skill in which the alien will engage during the exchange 
visitor program; or
    (iii) The alien acquires exchange visitor status in order to receive 
graduate medical education or training in the United States.
    (2) For the purposes of this paragraph the terms financed directly 
and financed indirectly are defined as set forth in section Sec. 514.1 
of chapter V.
    (3) The country in which 2 years' residence and physical presence 
will satisfy the requirements of INA 212(e) in the case of an alien 
determined to be subject to such requirements is the country of which 
the alien is a national and resident, or, if not a national, a lawful 
permanent resident (or has status equivalent thereto).
    (4) If an alien is subject to the 2-year foreign residence 
requirement of INA 212(e), the spouse or child of that alien, 
accompanying or following to join the

[[Page 195]]

alien, is also subject to that requirement if admitted to the United 
States pursuant to INA 101(a) (15) (J) or if status is acquired pursuant 
to that section after admission.
    (d) Notification to alien concerning 2-year foreign residence 
requirement. Before the consular officer issues an exchange visitor 
visa, the consular officer must inform the alien whether the alien will 
be subject to the 2-year residence and physical presence requirement of 
INA 212(e) if admitted to the United States under INA 101(a) (15) (J) 
and, if so, the country in which 2 years' residence and physical 
presence will satisfy the requirement.



                        Subpart H--Transit Aliens



Sec. 41.71  Transit aliens.

    (a) Transit aliens--general. An alien is classifiable as a 
nonimmigrant transit alien under INA 101(a) (15) (C) if the consular 
officer is satisfied that the alien:
    (1) Intends to pass in immediate and continuous transit through the 
United States;
    (2) Is in possession of a common carrier ticket or other evidence of 
transportation arrangements to the alien's destination;
    (3) Is in possession of sufficient funds to carry out the purpose of 
the transit journey, or has sufficient funds otherwise available for 
that purpose; and
    (4) Has permission to enter some country other than the United 
States following the transit through the United States, unless the alien 
submits satisfactory evidence that such advance permission is not 
required.
    (b) Certain aliens in transit to United Nations. An alien within the 
provisions of paragraph (3), (4), or (5) of section 11 of the 
Headquarters Agreement with the United Nations, to whom a visa is to be 
issued for the purpose of applying for admission solely in transit to 
the United Nations Headquarters District, may upon request or at the 
direction of the Secretary of State be issued a nonimmigrant visa 
bearing the symbol C-2. If such a visa is issued, the recipient shall be 
subject to such restrictions on travel within the United States as may 
be provided in regulations prescribed by the Attorney General.



              Subpart I--Fiance(e)s and Other Nonimmigrants



Sec. 41.81  Fiance(e) of a U.S. Citizen.

    (a) Petition requirement. An alien is classifiable as a nonimmigrant 
fiance(e) under INA 101(a)(15)(K) if the consular officer is satisfied 
that the alien is qualified under that provision and the consular 
officer has received a petition filed by the U.S. citizen to confer 
nonimmigrant status as a fiance(e) on the alien, which has been approved 
by the INS under INA 214(d), or a notification of such approval from 
that Service.
    (b) Certification of legal capacity and intent to marry. Upon 
receipt of a petition approved by INS and the alien's sworn statement of 
ability and intent to conclude a valid marriage with the petitioner 
within 90 days of arrival in the United States, the consular officer 
shall grant the alien the nonimmigrant status accorded in the petition 
and shall determine the eligibility of the alien to receive a K-1 visa.
    (c) Eligibility as immigrant required. The consular officer, insofar 
as practicable, shall determine the eligibility of an alien to receive a 
nonimmigrant visa under INA 101(a)(15)(K) as if the alien were an 
applicant for an immigrant visa. If the consular officer determines that 
the alien would be eligible, under INA 212 (a) and (e) and in all other 
respects to receive an immigrant visa, except the alien shall be exempt 
from the labor certification requirement of INA 212(a)(5), the officer 
may issue a nonimmigrant visa under this section.
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991]



Sec. 41.82  Certain parents and children of section 101(a)(27)(I) special immigrants [Reserved]



Sec. 41.83  Certain witnesses and informants.

    (a) General. An alien shall be classifiable under the provisions of 
INA 101(a)(15)(S) if:
    (1) The consular officer is satisfied that the alien qualifies under 
the provisions of that section; and

[[Page 196]]

    (2)(i) The consular officer has received verification from the 
Department of State, Visa Office, that:
    (A) in the case of INA 101(a)(15)(S)(i) the INS has certified on 
behalf of the Attorney General that the alien is accorded such 
classification, or
    (B) in the case of INA 101(a)(15)(S)(ii) the Assistant Secretary of 
State for Consular Affairs on behalf of the Secretary of State and the 
INS on behalf of the Attorney General have certified that the alien is 
accorded such classification;
    (ii) and the alien is granted an INA 212(d)(1) waiver of any INA 
212(a) ground of ineligibility known at the time of verification.
    (b) Certification of S visa status. The certification of status 
under INA 101(a)(15)(S)(i) by the Attorney General or of status under 
INA 101(a)(15)(S)(ii) by the Secretary of State and the Attorney General 
acting jointly does not establish that the alien is eligible to receive 
a nonimmigrant visa.
    (c) Validity of visa. The period of validity of a visa authorized on 
the basis of paragraph (a) of this section shall not exceed the period 
indicated in the certification required in paragraph (b) and shall not 
in any case exceed the period of three years.
[61 FR 1838, Jan. 24, 1996]



              Subpart J--Application for Nonimmigrant Visa



Sec. 41.101  Place of application.

    (a) Application for regular visa made at jurisdictional consular 
office of alien's residence or physical presence. (1) An alien applying 
for a nonimmigrant visa shall make application at a consular office 
having jurisdiction over the alien's place of residence, or if the alien 
is a resident of Taiwan, at the American Institute in Taiwan, unless--
    (i) The alien is physically present in the United States and is 
entitled to apply for issuance or reissuance of a visa under the 
provisions of Sec. 41.111(b); or
    (ii) A consular office having jurisdiction over the area in which 
the alien is physically present but not resident has agreed, as a matter 
of discretion or at the direction of the Department, to accept the 
alien's application; or
    (iii) The alien is subject to INA 222(g) and must apply as set forth 
in paragraph (b) or (c) of this section.
    (2) The Deputy Assistant Secretary of State for Visa Services is 
authorized to designate the geographical area for which each consular 
office possesses jurisdiction to process nonimmigrant visa applications.
    (b) Place of application for persons subject to INA 222(g). 
Notwithstanding the requirements of paragraph (a) of this section, an 
alien whose prior nonimmigrant visa has been voided pursuant to INA 
222(g), who is applying for a new nonimmigrant visa, shall make 
application at a consular office which has jurisdiction in or for the 
country of the alien's nationality unless extraordinary circumstances 
have been determined to exist with respect to that alien as set forth in 
paragraph (c) of this section.
    (c) Exceptions based on extraordinary circumstances. (1) An alien 
physician serving in underserved areas of the United States under the 
provisions of INA 214(k) for whom an application for a waiver of the 2-
year foreign residence requirement and/or a petition to accord H-1B 
status was filed prior to the end of the alien's authorized period of 
stay and was subsequently approved, but whose authorized stay expired 
during the adjudication of such application(s), shall make application 
in accordance with paragraph (a) of this section.
    (2) Any other individual or group whose circumstances are determined 
to be extraordinary, in accordance with paragraph (d)(1) of this 
section, by the Deputy Assistant Secretary for Visa Services upon the 
favorable recommendation of an immigration or consular officer, shall 
make application in accordance with paragraph (a) of this section.
    (3) An alien who has, or immediately prior to the alien's last entry 
into the United States had, a residence in a country other than the 
country of the alien's nationality shall apply at a consular office with 
jurisdiction in or for the country of residence.
    (4) An alien who is a national and resident of a country in which 
there is no United States consular office shall

[[Page 197]]

apply at a consular office designated by the Deputy Assistant Secretary 
for Visa Services to accept immigrant visa applications from persons of 
that nationality.
    (5) An alien who possesses more than one nationality and who has, or 
immediately prior to the alien's last entry into the United States had, 
a residence in one of the countries of the alien's nationality shall 
apply at a consular office in the country of such residence.
    (d) Definitions relevant to INA 222(g). (1) Extraordinary 
circumstances--Extraordinary circumstances may be found where compelling 
humanitarian or national interests exist or where necessary for the 
effective administration of the immigration laws. Extraordinary 
circumstances shall not be found upon the basis of convenience or 
financial burden to the alien, the alien's relative, or the alien's 
employer.
    (2) Nationality--For purposes of paragraph (b) of this section, a 
stateless person shall be considered to be a national of the country 
which issued the alien's travel document.
    (e) Regular visa defined. ``Regular visa'' means a nonimmigrant visa 
of any classification which does not bear the title ``Diplomatic'' or 
``Official.'' A nonimmigrant visa is issued as a regular visa unless the 
alien falls within one of the classes entitled to a diplomatic or an 
official visa as described in Sec. 41.26(c) or Sec. 41.27(c).
[52 FR 42597, Nov. 5, 1987; 53 FR 9112, Mar. 21, 1988, as amended at 61 
FR 1522, Jan. 22, 1996; 61 FR 53058, Oct. 10, 1996; 61 FR 56439, Nov. 1, 
1996; 63 FR 671, Jan. 7, 1998]



Sec. 41.102  Personal appearance of applicant.

    (a) Personal appearance required or waived. Except as otherwise 
provided in this section, every alien seeking a nonimmigrant visa is 
required to apply in person before a consular officer. The requirement 
of personal appearance may be waived by the consular officer in the case 
of any alien who is:
    (1) A child under 14 years of age;
    (2) Within a class of nonimmigrants classifiable under the visa 
symbols A, C-2, C-3, G, or NATO;
    (3) An applicant for a diplomatic or official visa;
    (4) Within a class of nonimmigrants classifiable under the visa 
symbols B, C-1, H-1, or I;
    (5) Within a class of nonimmigrants classifiable under the visa 
symbol J-1 who qualifies as a leader in a field of specialized knowledge 
or skill and also is the recipient of a U.S. Government grant, and such 
an alien's spouse and children qualifying for J-2 classification;
    (6) An aircraft crewman, applying for a nonimmigrant visa under the 
provisions of INA 101(a)(15)(D), if the application is supported by a 
letter from the employing carrier certifying that the applicant is 
employed as an aircraft crewman, and the consular officer is satisfied 
that the personal appearance of the alien is not necessary to determine 
visa eligibility; or
    (7) A nonimmigrant in any category, provided the consular officer 
determines that a waiver of personal appearance in the individual case 
is warranted in the national interest or because of unusual 
circumstances, including hardship to the visa applicant.
    (b) Interview by consular officer. Except when the requirement of 
personal appearance has been waived by the consular officer pursuant to 
paragraph (a) of this section, each applicant for a nonimmigrant visa 
must be interviewed by a consular officer, who shall determine on the 
basis of the applicant's representations and the visa application and 
other relevant documentation (1) the proper nonimmigrant classification, 
if any, of the alien and (2) the alien's eligibility to receive a visa.
[52 FR 42597, Nov. 5, 1987; 53 FR 9112, Mar. 21, 1988]



Sec. 41.103  Filing an application and Form OF-156.

    (a) Filing an application--(1) Filing of application on Form OF-156 
required unless waived. The consular officer may waive submission of an 
application, under paragraph (a)(3) of this section, for certain aliens 
for whom personal appearance has been waived under Sec. 41.102. Except 
for persons for whom such waivers have been granted, every alien seeking 
a nonimmigrant visa must make application therefor on

[[Page 198]]

Form OF-156, Nonimmigrant Visa Application, unless a prior Form OF-156 
is readily available at the consular office which can be appropriately 
amended to bring the application up to date.
    (2) Filing of Form OF-156 by alien under 16 or physically incapable. 
The application for an alien under 16 years of age or one physically 
incapable of completing an application may be completed and executed by 
the alien's parent or guardian, or, if the alien has no parent or 
guardian, by any person having legal custody of, or a legitimate 
interest in, the alien.
    (3) Waiver of filing of application. (i) When personal appearance is 
waived under Sec. 41.102(a)(2) or (3) the consular officer may also 
waive the filing of a visa application.
    (ii) When personal appearance is waived under Sec. 41.102(a)(7), the 
consular officer may also waive the filing of a visa application in 
cases of hardship, emergency, or national interest.
    (iii) Even if personal appearance is waived pursuant to any other 
subparagraph of Sec. 41.102(a), the requirement for filing an 
application may not be waived.
    (b) Application form--(1) Preparation of Form OF-156, Nonimmigrant 
Visa Application. (i) The consular officer shall ensure that Form OF-156 
is fully and properly completed in accordance with the applicable 
regulations and instructions.
    (ii) If the filing of a visa application is waived by the consular 
officer, the officer shall prepare a Form OF-156 on behalf of the 
applicant, using the data available in the passport or other documents 
which have been submitted.
    (2) Additional information as part of application. The consular 
officer may require the submission of additional necessary information 
or question an alien on any relevant matter whenever the consular 
officer believes that the information provided in Form OF-156 is 
inadequate to permit a determination of the alien's eligibility to 
receive a nonimmigrant visa. Additional statements made by the alien 
become a part of the visa application. All documents required by the 
consular officer under the authority of Sec. 41.105(a) are considered 
papers submitted with the alien's application within the meaning of INA 
221(g)(1).
    (3) Signature. When personal appearance is required, Form OF-156 
shall be signed and verified by, or on behalf of, the applicant in the 
presence of the consular officer. If personal appearance is waived, but 
the submission of an application form by the alien is not waived, the 
form shall be signed by the applicant. If the filing of an application 
form is also waived, the consular officer shall indicate that the 
application has been waived on the Form OF-156 prepared on behalf of the 
applicant, as provided in paragraph (b)(1)(ii) of this section. The 
consular officer, in every instance, shall initial the Form OF-156 over 
or adjacent to the officer's name and title stamp.
    (4) Registration. Form OF-156, when duly executed, constitutes the 
alien's registration record for the purposes of INA 221(b).



Sec. 41.104  Passport requirements.

    (a) Passports defined. ``Passport'' as defined in INA 101(a)(30) is 
not limited to a national passport or to a single document. A passport 
may consist of two or more documents which, when considered together, 
fulfill the requirements of a passport, provided that the documentary 
evidence of permission to enter a foreign country has been issued by a 
competent authority and clearly meets the requirements of INA 
101(a)(30).
    (b) Passport requirement. Except for certain persons in the A, C-3, 
G, and NATO classifications and persons for whom the passport 
requirement has been waived pursuant to the provisions of INA 212(d)(4), 
every applicant for a nonimmigrant visa is required to present a 
passport, as defined above and in INA 101(a)(30), which is valid for the 
period required by INA 212(a)(7)(B)(i)(I).
    (c) A single passport including more than one person. The passport 
requirement for a nonimmigrant visa may be met by the presentation of a 
passport including more than one person, if such inclusion is authorized 
under the laws or regulations of the issuing authority and if a 
photograph of each visa applicant 16 years of age or over has been

[[Page 199]]

attached to the passport by the issuing authority.
    (d) Applicants for diplomatic visas. Every applicant for a 
diplomatic visa must present a diplomatic passport, or the equivalent 
thereof, having the period of validity required by INA 
212(a)(7)(B)(i)(I), unless such requirement has been waived pursuant to 
the authority contained in INA 212(d)(4) or unless the case falls within 
the provisions of Sec. 41.21(b).
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 61 
FR 1522, Jan. 22, 1996; 61 FR 53058, Oct. 10, 1996]



Sec. 41.105  Supporting documents and fingerprinting.

    (a) Supporting documents--(1) Authority to require documents. The 
consular officer is authorized to require documents considered necessary 
to establish the alien's eligibility to receive a nonimmigrant visa. All 
documents and other evidence presented by the alien, including briefs 
submitted by attorneys or other representatives, shall be considered by 
the consular officer.
    (2) Unobtainable documents. If the consular officer is satisfied 
that a document or record required under the authority of this section 
is unobtainable, the consular officer may accept satisfactory 
alternative pertinent evidence. A document or other record shall be 
considered unobtainable if it cannot be procured without causing the 
applicant or a member of the applicant's family actual hardship as 
distinct from normal delay and inconvenience.
    (3) Photographs required or waived. Except as otherwise provided in 
this paragraph, every applicant for a nonimmigrant visa must furnish 
photographs in such numbers as the consular officer may require. The 
photographs must be a reasonable recent likeness, 1\1/2\ by 1\1/2\ 
inches in size, unmounted, with no head covering, and showing a full, 
front-face view of the alien against a light background. The alien must 
sign (full name) the reverse side of the photographs. The photograph 
requirement may be waived by the consular officer for any alien who is:
    (i) Within a class of nonimmigrants classifiable under the visa 
symbol A, C-3, G, or NATO; or
    (ii) An applicant for a diplomatic or official visa; or
    (iii) Under 16 years of age.

A notation of any such waiver shall be made on the application in the 
space provided for the photograph. A new photograph need not be required 
by the consular officer, if there is readily available at post a 
photograph submitted with a prior application which reflects a 
reasonable current likeness of the applicant.
    (4) Police certificates. A police certificate is a certification by 
the police or other appropriate authorities stating what, if anything, 
their records show concerning the alien. An applicant for a nonimmigrant 
visa is required to present a police certificate if the consular officer 
has reason to believe that a police or criminal record exists, except 
that no police certificate is required in the case of an alien who is 
within a class of nonimmigrants classifiable under visa symbols A-1, A-
2, C-3, G-1 through G-4, NATO-1 through NATO-4 or NATO-6.
    (b) Fingerprinting. The consular officer may require an alien making 
a preliminary or informal application for a visa to have a set of 
fingerprints taken on Form AR-4, Alien Registration Fingerprint Chart, 
if the officer considers this necessary for the purposes of 
identification and investigation. Consular officers may use the 
fingerprint card in order to ascertain from the appropriate authorities 
whether they have information pertinent to the applicant's eligibility 
to receive a visa.
[52 FR 42597, Nov. 5, 1987; 53 FR 9112, 9172, Mar. 21, 1988, as amended 
at 61 FR 1522, Jan. 22, 1996; 61 FR 53058, Oct. 10, 1996]



Sec. 41.106  Processing.

    Consular officers must ensure that Form OF-156, Nonimmigrant Visa 
Application, is properly and promptly processed in accordance with the 
applicable regulations and instructions.



Sec. 41.107  Visa fees.

    (a) Fees based on reciprocity. The fees for the issuance of visas, 
including official visas, to nonimmigrant nationals or stateless 
residents of each foreign country shall be collected in the amounts 
prescribed by the Secretary of

[[Page 200]]

State unless, on the basis of reciprocity, no fee is chargeable. If 
practicable, fees will correspond to the total amount of all visa, 
entry, residence, or other similar fees, taxes or charges assessed or 
levied against nationals of the United States by the foreign countries 
of which such nonimmigrants are nationals or stateless residents.
    (b) Fees when more than one alien included in visa. A single 
nonimmigrant visa may be issued to include all eligible family members 
if the spouse and unmarried minor children of a principal alien are 
included in one passport. Each alien must execute a separate 
application. The name of each family member shall be inserted in the 
space provided in the visa stamp. The visa fee to be collected shall 
equal the total of the fees prescribed by the Secretary of State for 
each alien included in the visa, unless upon a basis of reciprocity a 
lesser fee is chargeable.
    (c) Certain aliens exempted from fees. Upon a basis of reciprocity, 
or as provided in section 13(a) of the Headquarters Agreement with the 
United Nations (61 Stat. 716; 22 U.S.C. 287, Note), no fee shall be 
collected for the issuance of a nonimmigrant visa to an alien who is 
within a class of nonimmigrants classifiable under the visa symbols A, 
G, C-2, C-3, or NATO, or who is issued a diplomatic visa.
    (d) Refund of fees. A fee collected for the issuance of a 
nonimmigrant visa is refundable only if the principal officer at a post 
or the officer in charge of a consular section determines that the visa 
was issued in error or could not be used as a result of action taken by 
the U.S. Government for which the alien was not responsible and over 
which the alien had no control.
    (e) Visa processing surcharge. In addition to the collection of the 
fee prescribed in paragraph (a) of this section, a consular officer 
shall collect or ensure the collection of a surcharge for the processing 
of applications for machine readable nonimmigrant visas and for machine 
readable combined border crossing cards in the amount specified by the 
Secretary of State from such applicants as the Secretary of State shall 
designate. Such surcharge is refundable only if, as a result of action 
taken by the U.S. Goverment for which the alien was not responsible and 
over which the alien had no control, the alien's application is not 
processed.
[52 FR 42597, Nov. 5, 1987, as amended at 59 FR 25325, May 16, 1994]



Sec. 41.108  Medical examination.

    (a) Requirements for medical examination. An applicant for a 
nonimmigrant visa shall be required to take a medical examination if:
    (1) The alien is an applicant for a K nonimmigrant visa as a 
fiance(e) of a U.S. citizen or as the child of such an applicant; or,
    (2) The alien is seeking admission for medical treatment and the 
consular officer considers a medical examination advisable; or,
    (3) The consular officer has reason to believe that a medical 
examination might disclose that the alien is medically ineligible to 
receive a visa.
    (b) Examination by panel physician. The required examination, which 
must be carried out in accordance with United States Public Health 
Service regulations, shall be conducted by a physician selected by the 
alien from a panel of physicians approved by the consular officer or, if 
the alien is in the United States, by a medical officer of the United 
States Public Health Service or by a contract physician from a list of 
physicians approved by the INS for the examination of INA 245 adjustment 
of status applicants.
    (c) Panel physician facility requirements. A consular officer may 
not include the name of a physician on the panel of physicians referred 
to in paragraph (b) of this section unless the physician has facilities 
to perform required serological and X-ray tests or is in a position to 
refer applicants to a qualified laboratory for such tests.



                Subpart K--Issuance of Nonimmigrant Visa



Sec. 41.111  Authority to issue visa.

    (a) Issuance outside the United States. Any consular officer is 
authorized to issue regular and official visas. Diplomatic visas may be 
issued only by:
    (1) A consular officer attached to a U.S. diplomatic mission, if 
authorized to do so by the Chief of Mission; or

[[Page 201]]

    (2) A consular officer assigned to a consular office under the 
jurisdiction of a diplomatic mission, if so authorized by the Department 
or the Chief, Deputy Chief, or Counselor for Consular Affairs of that 
mission, or, if assigned to a consular post not under the jurisdiction 
of a diplomatic mission, by the principal officer of that post.
    (b) Issuance in the United States in certain cases. The Director of 
the Visa Office of the Department and such other officers of the 
Department as the former may designate are authorized, in their 
discretion, to issue nonimmigrant visas, including diplomatic visas, to:
    (1) Qualified aliens who are currently maintaining status and are 
properly classifiable in the A, C-2, C-3, G or NATO category and intend 
to reenter the United States in that status after a temporary absence 
abroad and who also present evidence that:
    (i) They have been lawfully admitted in that status or have, after 
admission, had their classification changed to that status; and
    (ii) Their period of authorized stay in the United States in that 
status has not expired; and
    (2) Other qualified aliens who are currently maintaining status in 
an E, H, I, or L nonimmigrant category and intend to reenter the United 
States in that status after a temporary absence abroad and who also 
present evidence that;
    (i) They were previously issued visas at a consular office abroad 
and admitted to the United States in the status which they are currently 
maintaining; and
    (ii) Their period of authorized admission in that status has not 
expired.



Sec. 41.112  Validity of visa.

    (a) Significance of period of validity of visa. The period of 
validity of a nonimmigrant visa is the period during which the alien may 
use it in making application for admission. The period of visa validity 
has no relation to the period of time the immigration authorities at a 
port of entry may authorize the alien to stay in the United States.
    (b) Validity of visa and number of applications for admission. (1) 
Except as provided in paragraph (c) of this section, a nonimmigrant visa 
shall have the validity prescribed in schedules provided to consular 
officers by the Department, reflecting insofar as practicable the 
reciprocal treatment accorded U.S. nationals, U.S. permanent residents, 
or aliens granted refugee status in the U.S. by the government of the 
country of which the alien is a national, permanent resident, refugee or 
stateless resident.
    (2) Notwithstanding paragraph (b)(1) of this section, United States 
nonimmigrant visas shall have a maximum validity period of 10 years.
    (3) An unexpired visa is valid for application for admission even if 
the passport in which the visa is stamped has expired, provided the 
alien is also in possession of a valid passport issued by the 
authorities of the country of which the alien is a national.
    (c) Limitation on validity. If warranted in an individual case, a 
consular officer may issue a nonimmigrant visa for:
    (1) A period of validity that is less than that prescribed on a 
basis of reciprocity,
    (2) A number of applications for admission within the period of the 
validity of the visa that is less than that prescribed on a basis of 
reciprocity,
    (3) Application for admission at a specified port or at specified 
ports of entry, or
    (4) Use on and after a given date subsequent to the date of 
issuance.
    (d) Automatic extension of validity at ports of entry. (1) Provided 
that the requirements set out in paragraph (d)(2) of this section are 
fully met, the following provisions apply to nonimmigrant aliens seeking 
readmission at ports of entry:
    (i) The validity of an expired nonimmigrant visa issued under INA 
101(a)(15) may be considered to be automatically extended to the date of 
application for readmission, and
    (ii) In cases where the original nonimmigrant classification of an 
alien has been changed by INS to another nonimmigrant classification, 
the validity of an expired or unexpired nonimmigrant visa may be 
considered to be automatically extended to the date of application for 
readmission, and the

[[Page 202]]

visa may be converted as necessary to that changed classification.
    (2) The provisions in paragraph (d)(1) of this section are 
applicable only in the case of a nonimmigrant alien who:
    (i) Is in possession of a Form I-94, Arrival-Departure Record, 
endorsed by INS to show an unexpired period of initial admission or 
extension of stay, or, in the case of a qualified F or J student or 
exchange visitor or the accompanying spouse or child of such an alien, 
is in possession of a current Form I-20, Certificate of Eligibility for 
Nonimmigrant Student Status, or Form IAP-66, Certificate of Eligibility 
for Exchange Visitor Status, issued by the school the student has been 
authorized to attend by INS, or by the sponsor of the exchange program 
in which the alien has been authorized to participate by INS, and 
endorsed by the issuing school official or program sponsor to indicate 
the period of initial admission or extension of stay authorized by INS;
    (ii) Is applying for readmission after an absence not exceeding 30 
days solely in contiguous territory, or, in the case of a student or 
exchange visitor or accompanying spouse or child meeting the 
stipulations of paragraph (d)(2)(i) of this section, after an absence 
not exceeding 30 days in contiguous territory or adjacent islands other 
than Cuba;
    (iii) Has maintained and intends to resume nonimmigrant status;
    (iv) Is applying for readmission within the authorized period of 
initial admission or extension of stay;
    (v) Is in possession of a valid passport; and
    (vi) Does not require authorization for admission under INA 
212(d)(3).
    (3) The provisions in paragraphs (d)(1) and (d)(2) of this section 
shall not apply to nationals of Iraq.
[52 FR 42597, Nov. 5, 1987; 53 FR 9112, 9172, Mar. 21, 1988, as amended 
at 55 FR 36028, Oct. 31, 1990; 62 FR 24332, May 5, 1997]



Sec. 41.113  Procedures in issuing visas.

    (a) Visa evidenced by stamp placed in passport. Except as provided 
in paragraphs (b) of this section, a nonimmigrant visa shall be 
evidenced by a visa stamp placed in the alien's passport. The 
appropriate symbol as prescribed in 41.12 , showing the classification 
of the alien, shall be entered on the visa.
    (b) Cases in which visa not placed in passport. In the following 
cases the visa shall be placed on the prescribed Form OF-232. In issuing 
such a visa, a notation shall be made on the Form OF-232 on which the 
visa is placed specifying the pertinent subparagraph of this paragraph 
under which the action is taken.
    (1) The alien's passport was issued by a government with which the 
United States does not have formal diplomatic relations, unless the 
Department has specifically authorized the placing of the visa in such 
passport;
    (2) The alien's passport does not provide sufficient space for the 
visa;
    (3) The passport requirement has been waived; or
    (4) In other cases as authorized by the Department.
    (c) Visa stamp. A machine-readable nonimmigrant visa foil, or other 
indicia as directed by the Department, shall constitute a visa 
``stamp,'' and shall be in a format designated by the Department, and 
contain, at a minimum, the following data:
    (1) Full name of the applicant;
    (2) Visa type/class;
    (3) Location of the visa issuing office;
    (4) Passport number;
    (5) Sex;
    (6) Date of birth;
    (7) Nationality;
    (8) Number of applications for admission or the letter ``M'' for 
multiple entries;
    (9) Date of issuance;
    (10) Date of expiration;
    (11) Visa control number.
    (d) Insertion of name; petition and derivative status notation. (1) 
The surname and given name of the visa recipient shall be shown on the 
visa in the space provided.
    (2) If the visa is being issued upon the basis of a petition 
approved by the Attorney General, the number of the petition, if any, 
the period for which the alien's admission has been authorized, and the 
name of the petitioner shall be reflected in the annotation field on the 
visa.
    (3) In the case of an alien who derives status from a principal 
alien, the name and position of the principal alien shall

[[Page 203]]

be reflected in the annotation field of the visa.
    (e) Period of validity. If a nonimmigrant visa is issued for an 
unlimited number of applications for admission within the period of 
validity, the letter ``M'' shall be shown under the word ``entries''. 
Otherwise the number of permitted applications for admission shall be 
identified numerically. The date of issuance and the date of expiration 
of the visa shall be shown at the appropriate places in the visa by day, 
month and year in that order. The standard three letter abbreviation for 
the month shall be used in all cases.
    (f) Restriction to specified port of entry. If a nonimmigrant visa 
is valid for admission only at one or more specified ports of entry, the 
names of those ports shall be entered in the annotation field. In cases 
where there is insufficient room to list the ports of entry, they shall 
be listed by hand on a clean passport page. Reference shall be made in 
the visa's annotation field citing the passport page upon which the 
ports are listed.
    (g) Delivery of visa and disposition of Form OF-156. In issuing a 
nonimmigrant visa, the consular officer shall deliver the visaed 
passport, or the prescribed Form OF-232, which bears the visa, to the 
alien or, if personal appearance has been waived, to the authorized 
representative. The executed Form OF-156, Nonimmigrant Visa Application, 
and any additional evidence furnished by the alien in accordance with 
41.103(b) shall be retained in the consular files.
    (h) Disposition of supporting documents. Original supporting 
documents furnished by the alien shall be returned for presentation, if 
necessary, to the immigration authorities at the port of entry, and a 
notation to that effect shall be made on the Form OF-156. Duplicate 
copies may be retained in the consular files.
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 61 
FR 1523, Jan. 22, 1996; 61 FR 1836, Jan. 24, 1996; 61 FR 53058, Oct. 10, 
1996; 62 FR 24334, May 5, 1997]



Sec. 41.114  Transfer of visas.

    (a) Conditions for transfer. Upon the request of the bearer a valid 
nonimmigrant visa shall be transferred from one travel document to a 
different travel document which is valid for the required period if the 
bearer is found eligible to receive such a visa, except in a case in 
which the travel document containing the original visa has been lost or 
stolen. A visa may be transferred only if the new passport indicates 
that the alien's nationality is the same as when the visa was issued.
    (b) Procedure for transfer. Application for the transfer of a 
nonimmigrant visa from one passport to another shall be made on an 
appropriate form. The consular officer may waive the personal appearance 
of the alien. The issuance of a transferred visa shall be evidenced by 
placing the visa stamp with all of the original data in the alien's 
passport. The validity of the transferred visa shall be the same as that 
of the original visa. The transferred visa shall be valid for the number 
of applications for admission remaining as of the date of the transfer. 
The word ``TRANSFERRED'' shall be inserted on the upper margin of the 
visa stamp.
    (c) Cancellation of visa in old passport. Unless the passport in 
which the original visa was issued has been surrendered to the issuing 
authority, the original visa shall be canceled at the time of its 
transfer to the new travel document, except, when a visa is transferred 
for only some of several persons included in the original visa, that 
visa is not to be canceled but the names of the persons whose visas are 
transferred are to be stricken from the original visa.
    (d) Fee for transfer. No fee shall be charged for the transfer of a 
valid nonimmigrant visa.



                   Subpart L--Refusals and Revocations



Sec. 41.121  Refusal of individual visas.

    (a) Grounds for refusal. Nonimmigrant visa refusals must be based on 
legal grounds, that is, one or more provisions of INA 212(a) or (e), INA 
214(b), INA 221(g), or INA 222(g). Certain classes of nonimmigrant 
aliens are exempted from specific provisions of INA 212(a) under INA 
102, and, upon a basis of reciprocity, under INA 212(d)(8).

[[Page 204]]

When a visa application has been properly completed and executed in 
accordance with the provisions of INA and the implementing regulations, 
the consular officer must either issue or refuse the visa.
    (b) Refusal procedure. If a consular officer knows or has reason to 
believe that an alien is ineligible to receive a visa on grounds of 
ineligibility which cannot be overcome by the presentation of additional 
evidence, the officer shall refuse the visa and, if practicable, shall 
require a nonimmigrant visa application to be executed before the 
refusal is recorded. In the case of a visa refusal the consular officer 
shall inform the applicant of the provision of law or regulations upon 
which the refusal is based. If the alien fails to execute a visa 
application after being informed by the consular officer of a ground of 
ineligibility to receive a nonimmigrant visa, the visa shall be 
considered refused. The officer shall then insert the pertinent data on 
the visa application, noting the reasons for the refusal, and the 
application form shall be filed in the consular office. Upon refusing a 
nonimmigrant visa, the consular officer shall retain the original or a 
copy of each document upon which the refusal was based as well as each 
document indicating a possible ground of ineligibility and may return 
all other supporting documents supplied by the applicant.
    (c) Review of refusal at consular office. If the ground(s) of 
ineligibility upon which the visa was refused cannot be overcome by the 
presentation of additional evidence, the principal consular officer, or 
a specifically designated alternate, shall review the case without 
delay, record the review decision, and sign and date the prescribed 
form. If the ground(s) of ineligibility may be overcome by the 
presentation of additional evidence, and the applicant has indicated the 
intention to submit such evidence, a review of the refusal may be 
deferred for not more than 120 days. If the principal consular officer 
or alternate does not concur in the refusal, that officer shall either
    (1) Refer the case to the Department for an advisory opinion, or
    (2) Assume responsibility for the case by reversing the refusal.
    (d) Review of refusal by Department. The Department may request a 
consular officer in a specific case or in specified classes of cases to 
submit a report if a visa has been refused. The Department will review 
each report and may furnish an advisory opinion to the consular officer 
for assistance in considering the case further. If the officer believes 
that action contrary to an advisory opinion should be taken, the case 
shall be resubmitted to the Department with an explanation of the 
proposed action. Rulings of the Department concerning an interpretation 
of law, as distinguished from an application of the law to the facts, 
shall be binding upon consular officers.
[52 FR 42597, Nov. 5, 1987, as amended at 56 FR 30428, July 2, 1991; 63 
FR 671, Jan. 7, 1998]



Sec. 41.122  Revocation of visas.

    (a) Grounds for revocation by consular officers. A consular officer 
is authorized to revoke a nonimmigrant visa issued to an alien if:
    (1) The officer finds that the alien was not, or has ceased to be, 
entitled to the nonimmigrant classification under INA 101(a)(15) 
specified in the visa or that the alien was at the time the visa was 
issued, or has since become, ineligible under INA 212(a) to receive a 
visa;
    (2) The visa has been physically removed from the passport in which 
it was issued prior to the alien's embarkation upon a continuous voyage 
to the United States; or
    (3) For any of the reasons specified in paragraph (h) of this 
section if the visa has not been revoked by an immigration officer as 
authorized in that paragraph.
    (b) Notice of proposed revocation. When consideration is being given 
to the revocation of a nonimmigrant visa under paragraph (a)(1) or (2) 
of this section, the consular officer considering that action shall, if 
practicable, notify the alien to whom the visa was issued of intention 
to revoke the visa. The alien shall also be given an opportunity to show 
why the visa should not be revoked and requested to present the travel 
document in which the visa was originally issued.
    (c) Procedure for physically cancelling visas. A nonimmigrant visa 
which is revoked shall be canceled by writing or

[[Page 205]]

stamping the word ``REVOKED'' plainly across the face of the visa. The 
cancellation shall be dated and signed by the officer taking the action. 
The failure of the alien to present the visa for cancellation does not 
affect the validity of action taken to revoke it.
    (d) Notice to carriers. Notice of revocation shall be given to the 
master, aircraft captain, agent, owner, charterer, or consignee of the 
carrier or transportation line on which it is believed the alien intends 
to travel to the United States, unless the visa has been physically 
canceled as provided in paragraph (c) of this section.
    (e) Notice to Department. When a visa is revoked under paragraph 
(a)(1) or (2) of this section, the consular officer shall promptly 
submit notice of the revocation, including a full report on the facts in 
the case, to the Department for transmission to INS. A report is not 
required if the visa is physically canceled prior to the alien's 
departure for the United States except in cases involving A, G, C-2, C-
3, NATO, diplomatic or official visas.
    (f) Record of action. Upon revocation of a nonimmigrant visa under 
paragraph (a)(1) or (2) of this section, the consular officer shall 
complete for the post files a Certificate of Revocation by Consular 
Officer which includes a statement of the reasons for the revocation. If 
the revocation is effected at other than the issuing office, a copy of 
the Certificate of Revocation shall be sent to that office.
    (g) Reconsideration of revocation. (1) The consular office shall 
consider any evidence submitted by the alien or the alien's attorney or 
representative in connection with a request that the revocation be 
reconsidered. If the officer finds that the evidence is sufficient to 
overcome the basis for the revocation, a new visa shall be issued. A 
memorandum regarding the action taken and the reasons therefor shall be 
placed in the consular files and appropriate notification shall be made 
promptly to the carriers concerned, the Department, and the issuing 
office if notice of revocation has been given in accordance with 
paragraphs (d), (e), and (f) of this section.
    (2) In view of the provisions of Sec. 41.107(d) providing for the 
refund of fees when a visa has not been used as a result of action by 
the U.S. Government, a fee shall not be charged in connection with a 
reinstated visa.
    (h) Revocation of visa by immigration officer. An immigration 
officer is authorized to revoke a valid visa by physically canceling it 
in accordance with the procedure prescribed in paragraph (c) of this 
section if:
    (1) The alien obtains an immigrant visa or an adjustment of status 
to that of permanent resident;
    (2) The alien is ordered excluded from the United States pursuant to 
INA 235(c) or 236;
    (3) The alien is notified pursuant to INA 235(b) by an immigration 
officer at a port of entry that the alien appears to be inadmissible to 
the United States and the alien requests and is granted permission to 
withdraw the application for admission;
    (4) A final order of deportation or a final order granting voluntary 
departure with an alternate order of deportation is entered against the 
alien pursuant to INS regulations;
    (5) The alien has been permitted by INS to depart voluntarily from 
the United States pursuant to INS regulations;
    (6) A waiver of ineligibility pursuant to INA 212(d)(3)(A) on the 
basis of which the visa was issued to the alien is revoked by INS;
    (7) The visa is presented in connection with an application for 
admission to the United States by a person other than the alien to whom 
it was issued; or
    (8) The visa has been physically removed from the passport in which 
it was issued.



PART 42--VISAS: DOCUMENTATION OF IMMIGRANTS UNDER THE IMMIGRATION AND NATIONALITY ACT, AS AMENDED--Table of Contents




    Subpart A--Visa and Passport Not Required for Certain Immigrants

Sec.
42.1  Aliens not required to obtain immigrant visas.
42.2  Aliens not required to present passports.

[[Page 206]]

        Subpart B--Classification and Foreign State Chargeability

42.11  Classification symbols.
42.12  Rules of chargeability.

 Subpart C--Immigrants Not Subject to Numerical Limitations of INA 201 
                                 and 202

42.21  Immediate relatives.
42.22  Returning resident aliens.
42.23  Certain former U.S. citizens.

         Subpart D--Immigrants Subject to Numerical Limitations

42.31  Family-sponsored immigrants.
42.32  Employment-based preference immigrants.
42.33  Diversity immigrants.

                          Subpart E--Petitions

42.41  Effect of approved petition.
42.42  Petitions for immediate relative or preference status.
42.43  Suspension or termination of action in petition cases.

            Subpart F--Numerical Controls and Priority Dates

42.51  Department control of numerical limitations.
42.52  Post records of visa applications.
42.53  Priority date of individual applicants.
42.54  Order of consideration.
42.55  Reports on numbers and priority dates of applications on record.

               Subpart G--Application for Immigrant Visas

42.61  Place of application.
42.62  Personal appearance and interview of applicant.
42.63  Application forms and other documentation.
42.64  Passport requirements.
42.65  Supporting documents.
42.66  Medical examination.
42.67  Execution of application, registration, and fingerprinting.
42.68  Informal evaluation of family members if principal applicant 
          precedes them.

                 Subpart H--Issuance of Immigrant Visas

42.71  Authority to issue visas; visa fees.
42.72  Validity of visas.
42.73  Procedure in issuing visas.
42.74  Issuance of new or replacement visas.

     Subpart I--Refusal, Revocation, and Termination of Registration

42.81  Procedure in refusing individual visas.
42.82  Revocation of visas.
42.83  Termination of registration.

    Authority:  8 U.S.C. 1104.

    Source:  52 FR 42613, Nov. 5, 1987, unless otherwise noted.



    Subpart A--Visa and Passport Not Required for Certain Immigrants



Sec. 42.1  Aliens not required to obtain immigrant visas.

    An immigrant within any of the following categories is not required 
to obtain an immigrant visa:
    (a) Aliens lawfully admitted for permanent residence. An alien who 
has previously been lawfully admitted for permanent residence and who is 
not required under the regulations of INS to present a valid immigrant 
visa upon returning to the United States.
    (b) Alien members of U.S. Armed Forces. An alien member of the U.S. 
Armed Forces bearing military identification, who has previously been 
lawfully admitted for permanent residence and is coming to the United 
States under official orders or permit of those Armed Forces.
    (c) Aliens entering from Guam, Puerto Rico, or the Virgin Islands. 
An alien who has previously been lawfully admitted for permanent 
residence who seeks to enter the continental United States or any other 
place under the jurisdiction of the United States directly from Guam, 
Puerto Rico, or the Virgin Islands of the United States.
    (d) Child born after issuance of visa to accompanying parent. An 
alien child born after the issuance of an immigrant visa to an 
accompanying parent, who will arrive in the United States with the 
parent, and apply for admission during the period of validity of the 
visa issued to the parent.
    (e) Child born of a national or lawful permanent resident mother 
during her temporary visit abroad. An alien child born during the 
temporary visit abroad of a mother who is a national or lawful permanent 
resident of the United States if applying for admission within 2 years 
of birth and accompanied by either parent applying and eligible for 
readmission as a permanent resident upon that parent's first return to 
the United States after the child's birth.

[[Page 207]]

    (f) American Indians born in Canada. An American Indian born in 
Canada and having at least 50 per centum of blood of the American Indian 
race.



Sec. 42.2  Aliens not required to present passports.

    An immigrant within any of the following categories is not required 
to present a passport in applying for an immigrant visa:
    (a) Certain relatives of U.S. citizens. An alien who is the spouse, 
unmarried son or daughter, or parent, of a U.S. citizen, unless the 
alien is applying for a visa in the country of which the applicant is a 
national and the possession of a passport is required for departure.
    (b) Returning aliens previously lawfully admitted for permanent 
residence. An alien previously lawfully admitted for permanent residence 
who is returning from a temporary visit abroad, unless the alien is 
applying for a visa in the country of which the applicant is a national 
and the possession of a passport is required for departure.
    (c) Certain relatives of aliens lawfully admitted for permanent 
residence. An alien who is the spouse, unmarried son or daughter, or 
parent of an alien lawfully admitted for permanent residence, unless the 
alien is applying for a visa in the country of which the applicant is a 
national and the possession of a passport is required for departure.
    (d) Stateless persons. An alien who is a stateless person, and 
accompanying spouse and unmarried son or daughter.
    (e) Nationals of Communist-controlled countries. An alien who is a 
national of a Communist-controlled country and who is unable to obtain a 
passport from the government of that country, and accompanying spouse 
and unmarried son or daughter.
    (f) Alien members of U.S. Armed Forces. An alien who is a member of 
the U.S. Armed Forces.
    (g) Beneficiaries of individual waivers. (1) An alien who would be 
within one of the categories described in paragraphs (a) through (d) of 
this section except that the alien is applying for a visa in a country 
of which the applicant is a national and possession of a passport is 
required for departure, in whose case the passport requirement has been 
waived by the Secretary of State, as evidence by a specific instruction 
from the Department.
    (2) An alien unable to obtain a passport and not within any of the 
foregoing categories, in whose case the passport requirement imposed by 
Sec. 42.64(b) or by INS regulations has been waived by the Attorney 
General and the Secretary of State as evidenced by a specific 
instruction from the Department.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49680, Oct. 1, 1991]



        Subpart B--Classification and Foreign State Chargeability



Sec. 42.11  Classification symbols.

    A visa issued to an immigrant alien within one of the classes 
described below shall bear an appropriate visa symbol to show the 
classification of the alien.

                                                   Immigrants                                                   
----------------------------------------------------------------------------------------------------------------
         Symbol                             Class                                   Section of law              
----------------------------------------------------------------------------------------------------------------
                                               Immediate Relatives                                              
----------------------------------------------------------------------------------------------------------------
IR1.....................  Spouse of U.S. Citizen...................  201(b).                                    
IR2.....................  Child of U.S. Citizen....................  201(b).                                    
IR3.....................  Orphan Adopted Abroad by U.S. Citizen....  201(b).                                    
IR4.....................  Orphan to be Adopted In the United States  201(b).                                    
                           by U.S. Citizen.                                                                     
IR5.....................  Parent of U.S. Citizen at Least 21 Years   201(b).                                    
                           of Age.                                                                              
CR1.....................  Spouse of U.S. Citizen (Conditional        201(b) & 216(a)(1).                        
                           Status).                                                                             
CR2.....................  Child of U.S. Citizen (Conditional         201(b) & 216.                              
                           Status).                                                                             
IW1.....................  Certain Spouses of Deceased U.S. Citizens  201(b).                                    
IW2.....................  Child of IW1.............................  201(b).                                    
IB1.....................  Self-petition Spouse of U.S. Citizen.....  204(a)(1)(A)(iii).                         
IB2.....................  Self-petition child of U.S. Citizen......  204(a)(1)(A)(iv).                          
IB3.....................  Child of IB1.............................  204(a)(1)(A)(iii).                         

[[Page 208]]

                                                                                                                
VI5.....................  Parent of U.S. Citizen Who Acquired        201(b) & sec. 2 of the Virgin Islands,     
                           Permanent Resident Status Under the        Nonimmigrant Alien, Adjustment Act, (P.L. 
                           Virgin Islands Nonimmigrant Alien          97-271).                                  
                           Adjustment Act.                                                                      
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          Vietnam Amerasian Immigrants                                          
----------------------------------------------------------------------------------------------------------------
AM1.....................  Vietnam Amerasian Principal..............  584(b)(1)(A).                              
AM2.....................  Spouse or Child of AM1...................  584(b)(1)(B), and                          
AM3.....................  Natural Mother of Unmarried AM1 (and       584(b)(1)(C) of the Foreign Operations,    
                           Spouse or Child of Such Mother), or        Export Financing, and Related Programs    
                           Person Who has Acted in Effect as the      Appropriations Act, 1988 (As Contained in 
                           Mother, Father, or Next-of-Kin of          sec. 101(e) of P.L 100-202) as amended).  
                           Unmarried AM1 (and Spouse or Child of                                                
                           Such Person).                                                                        
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                               Special Immigrants                                               
----------------------------------------------------------------------------------------------------------------
SB1.....................  Returning Resident.......................  101(a)(27)(A).                             
SC1.....................  Person Who Lost U.S. Citizenship by        101(a)(27)(B) & 324(a).                    
                           Marriage.                                                                            
SC2.....................  Person Who Lost U.S. Citizenship by        101(a)(27)(B) & 327.                       
                           Serving in Foreign Armed Forces.                                                     
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          Family-Sponsored Preferences                                          
                                                                                                                
  Family 1st Preference                                                                                         
----------------------------------------------------------------------------------------------------------------
F11.....................  Unmarried Son or Daughter of U.S. Citizen  203(a)(1).                                 
F12.....................  Child of F11.............................  203(d).                                    
B11.....................  Self-petition Unmarried Son or Daughter    204(a)(1)(A)(iv) & 203(a)(1).              
                           of U.S. Citizen.                                                                     
B12.....................  Child of B11.............................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                             Family 2nd Preference (Subject to Country Limitations)                             
----------------------------------------------------------------------------------------------------------------
F21.....................  Spouse of Alien Resident.................  203(a)(2)(A).                              
F22.....................  Child of Alien Resident..................  203(a)(2)(A).                              
F23.....................  Child of F21 or F22......................  203(d).                                    
F24.....................  Unmarried Son or Daughter of Alien         203(a)(2)(B).                              
                           Resident.                                                                            
F25.....................  Child of F24.............................  203(d).                                    
C21.....................  Spouse of Alien Resident (Conditional)...  203(a)(2)(A) & 216.                        
C22.....................  Child of Alien Resident (Conditional)....  202(a)(2)(A) & 216.                        
C23.....................  Child of C21 or C22 (Conditional)........  203(d) & 216.                              
C24.....................  Unmarried Son or Daughter of Alien         203(a)(2)(B) & 216.                        
                           Resident (Conditional).                                                              
C25.....................  Child of F24 (Conditional)...............  203(d) & 216.                              
B21.....................  Self-petition Spouse of Lawful Permanent   204(a)(1)(B)(ii).                          
                           Resident.                                                                            
B22.....................  Self-petition Child of Lawful Permanent    204(a)(1)(B)(iii).                         
                           Resident.                                                                            
B23.....................  Child of B21 or B22......................  204(a)(1)(B)(ii).                          
B24.....................  Self-petition Unmarried Son or Daughter    203(d).                                    
                           of Lawful Permanent Resident.                                                        
B25.....................  Child of B24.............................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                             Family 2nd Preference (Exempt from Country Limitations)                            
----------------------------------------------------------------------------------------------------------------
FX1.....................  Spouse of Alien Resident.................  202(a)(4)(A) . 203(a)(2)(A).               
FX2.....................  Child of Alien Resident..................  202(a)4)(A) & 203(a)(2)(A).                
FX3.....................  Child of FX1 and FX2.....................  202(a)(4)(A) & 203(d) 203(a)(2)(A).        
CX1.....................  Spouse of Alien Resident (Conditional)...  202(a)(4)(A) & 216.                        
CX2.....................  Child of Alien Resident (Conditional)....  202(a)(4)(A) & 216.                        
CX3.....................  Child of CX1 & CX2 (Conditional).........  202(a)(4)(A) & 203(d) & 216.               
BX1.....................  Self-petition Spouse of Lawful Permanent   204(a)(1)(B)(ii).                          
                           Resident.                                                                            
BX2.....................  Self-petition Child of Lawful Permanent    204(a)(1)(B)(iii).                         
                           Resident.                                                                            
BX3.....................  Child of BX1 or BX2......................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                              Family 3rd Preference                                             
----------------------------------------------------------------------------------------------------------------
F31.....................  Married Son or Daughter of U.S. Citizen..  203(a)(3).                                 
F32.....................  Spouse of F31............................  203(d).                                    
F33.....................  Child of F31.............................  302(d).                                    
C31.....................  Married Son or Daughter of U.S. Citizen    216(a)(1).                                 
                           (Conditional).                                                                       
C32.....................  Spouse of C31 (Conditional)..............  203(d) & 216.                              
C33.....................  Child of C31 (Conditional)...............  203(d) & 216.                              
B31.....................  Self-petition Married Son or Daughter of   204(a)(1)(A)(iv) & 203(a)(3).              
                           U.S. Citizen.                                                                        

[[Page 209]]

                                                                                                                
B32.....................  Spouse of B31............................  203(d).                                    
B33.....................  Child of B31.............................  203(d).                                    
                                                                                                                
                                              Family 4th Preference                                             
                                                                                                                
----------------------------------------------------------------------------------------------------------------
F41.....................  Brother or Sister of U.S. Citizen........  203(a)(4).                                 
F42.....................  Spouse of F41............................  203(d).                                    
F43.....................  Child of F41.............................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                          Employment-Based Preferences                                          
                                                                                                                
                                  Employment 1st Preference (Priority Workers)                                  
                                                                                                                
----------------------------------------------------------------------------------------------------------------
E11.....................  Alien with Extraordinary Ability.........  203(b)(1)(A).                              
E12.....................  Outstanding Professor or Researcher......  203(b)(1)(B).                              
E13.....................  Multinational Executive or Manager.......  203(b)(1)(C).                              
E14.....................  Spouse of E11, E12, or E13...............  203(d).                                    
E15.....................  Child of E11, E12, or E13................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
      Employment 2nd Preference (Professionals Holding Advanced Degrees or Persons of Exceptional Ability)      
                                                                                                                
----------------------------------------------------------------------------------------------------------------
E21.....................  Professional Holding Advanced Degree or    203(b)(2).                                 
                           of Exceptional Ability.                                                              
E22.....................  Spouse of E21............................  203(d).                                    
E23.....................  Child of E21.............................  203(d).                                    
ES1.....................  Soviet Scientist (Prinicipal) Qualified    203(b)(2) and sec. 4 of the Soviet         
                           for Status Under Pub. L. 102-509.          Scientists Immigration.                   
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                  Employment 3rd Preference (Skilled Workers, Professionals, and Other Workers)                 
                                                                                                                
----------------------------------------------------------------------------------------------------------------
E31.....................  Skilled Worker...........................  203(b)(3)(A)(i).                           
E32.....................  Professional Holding Baccalaureate Degree  203(b)(3)(A)(ii).                          
E34.....................  Spouse of E31 or E32.....................  203(d)                                     
E35.....................  Child of E31 or E32......................  203(d).                                    
EW3.....................  Other Worker (Subgroup Numerical Limit)..  203(b)(3)(A)(iii).                         
EW4.....................  Spouse of EW3............................  203(d).                                    
EW5.....................  Child of EW3.............................  203(d).                                    
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                             Employment 4th Preference (Certain Special Immigrants)                             
                                                                                                                
----------------------------------------------------------------------------------------------------------------
SD1.....................  Minister of Religion.....................  101(a)(27)(C) . 203(b)(4).                 
SD2.....................  Spouse of SD1............................  101(a)(27)(C) & 203(b)(4).                 
SD3.....................  Child of SD1.............................  101(a)(27)(C) & 203(b)(4).                 
SE1.....................  Certain Employees or Former Employees of   101(a)(27)(D).                             
                           the U.S. Government Abroad.                                                          
SE2.....................  Spouse of SE1............................  101(a)(27)(D).                             
SE3.....................  Child of SE1.............................  101(a)(27)(D).                             
SEH.....................  Employee of the Mission in Hong Kong or    101(a)(27)(D) & Section 152 of the         
                           Immediate Family.                          Immigration Act of 1990.                  
SF1.....................  Certain Former Employees of the Panama     101(a)(27)(E).                             
                           Canal Company or Canal Zone Government.                                              
SF2.....................  Spouse or Child of SF1...................  101(a)(27)(E).                             
SG1.....................  Certain Former Employees of the U.S.       101(a)(27)(F).                             
                           Government in the Panama Canal Zone.                                                 
SG2.....................  Spouse or Child of SG1...................  101(a)(27)(F).                             
SH1.....................  Certain Former Employees of the Panama     101(a)(27)(G).                             
                           Canal Company or Canal Zone Government                                               
                           on April 1, 1979.                                                                    
SH2.....................  Spouse or Child of SH1...................  101(a)(27)(G).                             
SJ1.....................  Certain Foreign Medical Graduates          101(a)(27)(H).                             
                           (Adjustments Only).                                                                  
SJ2.....................  Accompanying Spouse or Child of SJ1......  101(a)(27)(H).                             
SK1.....................  Certain Retired International              101(a)(27)(I)(iii).                        
                           Organization Employees.                                                              
SK2.....................  Spouse SK1...............................  101(a)(27)(I)(iv).                         
SK3.....................  Certain Unmarried Son or Daughter of       101(a)(27)(I)(i).                          
                           International Organization Employee.                                                 
SK4.....................  Certain Surviving Spouses of Deceased      101(a)(27)(I)(ii).                         
                           International Organization Employee.                                                 
SL1.....................  Juvenile Court Dependent.................  101(a)(27)(J).                             
SM1.....................  Alien Recruited Outside the United States  101(a)(27)(K).                             
                           Who Has Served or is Enlisted to Serve                                               
                           in the U.S. Armed Forces for 12 Years                                                
                           (Became Eligible After the Date of                                                   
                           Enactment)..                                                                         

[[Page 210]]

                                                                                                                
SM2.....................  Spouse of SM1............................  101(a)(27)(K).                             
SM3.....................  Child of SM1.............................  101(a)(27)(K).                             
SM4.....................  Alien Recruited Outside the United States  101(a)(27)(K).                             
                           Who Has Served or is Enlisted to Serve                                               
                           in the U.S. Armed Forces for 12 Years                                                
                           (Became Eligible As of the Date of                                                   
                           Enactment).                                                                          
SM5.....................  Spouse or Child of SM4...................  101(a)(27)(K).                             
SR1.....................  Certain Religious Workers................  101(a)(27)(C)(ii)(II) & (III).             
SR2.....................  Spouse of SR1............................  101(a)(27)(C)(ii)(II) & (III).             
SR3.....................  Child of SR1.............................  101(a)(27)(C)(ii)(II) & (III).             
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                       Employment 5th Preference (Employment Reaction Conditional Status)                       
                                                                                                                
----------------------------------------------------------------------------------------------------------------
C51.....................  Employment Creation OUTSIDE Targeted       203(b)(5)(A).                              
                           Areas.                                                                               
C52.....................  Spouse of C51............................  203(d).                                    
C53.....................  Child of C51.............................  203(d).                                    
T51.....................  Employment Creation IN Targeted Rural/     203(b)(5)(B).                              
                           High Unemployment Area.                                                              
T52.....................  Spouse of T51............................  203(d).                                    
T53.....................  Child of T51.............................  203(d).                                    
R51.....................  Investor Pilot Program, Not in Targeted    203(b)(5) & Sec. 610 of the Departments of 
                           Area.                                      Commerce, Justice, and State, the         
                                                                      Judiciary and Related Agencies            
                                                                      Appropriations Act, 1993 (P.L. 102-395)   
                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                      Other Numerically Limited Categories                                      
                                                                                                                
                                   Diversity Immigrants (Beginning in FY 1995)                                  
                                                                                                                
----------------------------------------------------------------------------------------------------------------
DV1.....................  Diversity Immigrant......................  Section 203(c).                            
DV2.....................  Spouse of DV1............................  Section 203(c).                            
DV3.....................  Child of DV1.............................  Section 203(c).                            
                                                                                                                
----------------------------------------------------------------------------------------------------------------
           Transition for Employees of Certain U.S. Businesses in Hong Kong (Fiscal Years 1991-1993)*           
                                                                                                                
----------------------------------------------------------------------------------------------------------------
HK1.....................  Employee of U.S. Business in Hong Kong...  Section 124 of the Immigration Act of 1990.
HK2.....................  Spouse of HK1............................  Section 124 of the Immigration Act of 1990.
HK3.....................  Child of HK1.............................  Section 124 of the Immigration Act of 1990.
                                                                                                                
----------------------------------------------------------------------------------------------------------------
     Diversity Transition for Natives of Certain Adversely Affected Foreign States (Fiscal Years 1992-1995)     
                                                                                                                
----------------------------------------------------------------------------------------------------------------
AA1.....................  Diversity Transition Immigration.........  Section 132 of the Immigration Act of 1990.
AA2.....................  Spouse of AA1............................  Section 132 of the Immigration Act of 1990.
AA3.....................  Child of AA1.............................  Section 132 of the Immigration Act of 1990.
----------------------------------------------------------------------------------------------------------------
* Although these visas may no longer be issued, some HK visas remain valid through January 1, 2002.             

[60 FR 10499, Feb. 27, 1995, as amended at 62 FR 614, Jan. 6, 1997]



Sec. 42.12  Rules of chargeability.

    (a) Applicability. An immigrant shall be charged to the numerical 
limitation for the foreign state or dependent area of birth, unless the 
case falls within one of the exceptions to the general rule of 
chargeability provided by INA 202(b) and paragraphs (b) through (e) of 
this section to prevent the separation of families or the alien is 
classifiable under:
    (1) INA 201(b);
    (2) INA 101(a)(27) (A) or (B);
    (3) Section 112 of Public Law 101-649;
    (4) Section 124 of Public Law 101-649;
    (5) Section 132 of Public Law 101-649;
    (6) Section 134 of Public Law 101-649; or

[[Page 211]]

    (7) Section 584(b)(1) as contained in section 101(e) of Public Law 
100-202.
    (b) Exception for child. If necessary to prevent the separation of a 
child from the alien parent or parents, an immigrant child, including a 
child born in a dependent area, may be charged to the same foreign state 
to which a parent is chargeable if the child is accompanying or 
following to join the parent, in accordance with INA 202(b)(1).
    (c) Exception for spouse. If necessary to prevent the separation of 
husband and wife, an immigrant spouse, including a spouse born in a 
dependent area, may be charged to a foreign state to which a spouse is 
chargeable if accompanying or following to join the spouse, in 
accordance with INA 202(b)(2).
    (d) Exception for alien born in the United States. An immigrant who 
was born in the United States shall be charged to the foreign state of 
which the immigrant is a citizen or subject. If not a citizen or subject 
of any country, the alien shall be charged to the foreign state of last 
residence as determined by the consular officer, in accordance with INA 
202(b)(3).
    (e) Exception for alien born in foreign state in which neither 
parent was born or had residence at time of alien's birth. An alien who 
was born in a foreign state, as defined in Sec. 40.1, in which neither 
parent was born, and in which neither parent had a residence at the time 
of the applicant's birth, may be charged to the foreign state of either 
parent as provided in INA 202(b)(4). The parents of such an alien are 
not considered as having acquired a residence within the meaning of INA 
202(b)(4), if, at the time of the alien's birth within the foreign 
state, the parents were visiting temporarily or were stationed there in 
connection with the business or profession and under orders or 
instructions of an employer, principal, or superior authority foreign to 
such foreign state.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49681, Oct. 1, 1991]



 Subpart C--Immigrants Not Subject to Numerical Limitations of INA 201 
                                 and 202

    Source:  56 FR 49676, Oct. 1, 1991, unless otherwise noted.



Sec. 42.21  Immediate relatives.

    (a) Entitlement to status. An alien who is a spouse or child of a 
United States citizen, or a parent of a U.S. citizen at least 21 years 
of age, shall be classified as an immediate relative under INA 201(b) if 
the consular officer has received from INS an approved Petition to 
Classify Status of Alien Relative for Issuance of an Immigrant Visa, 
filed on the alien's behalf by the U.S. citizen and approved in 
accordance with INA 204, and the officer is satisfied that the alien has 
the relationship claimed in the petition. An immediate relative shall be 
documented as such unless the U.S. citizen refuses to file the required 
petition, or unless the immediate relative is also a special immigrant 
under INA 101(a)(27) (A) or (B) and not subject to any numerical 
limitation.
    (b) Spouse of a deceased U.S. Citizen. The spouse of a deceased U.S. 
citizen shall be entitled to immediate relative status after the date of 
the citizen's death provided he or she meets the criteria of INA 
201(b)(2)(A)(i) and the consular office has received an approved 
petition from the INS which accords such status, or official 
notification of such approval, and the consular officer is satisfied 
that the alien meets those criteria.



Sec. 42.22  Returning resident aliens.

    (a) Requirements for returning resident status. An alien shall be 
classifiable as a special immigrant under INA 101(a)(27)(A) if the 
consular officer is satisfied from the evidence presented that:
    (1) The alien had the status of an alien lawfully admitted for 
permanent residence at the time of departure from the United States;
    (2) The alien departed from the United States with the intention of 
returning and has not abandoned this intention; and
    (3) The alien is returning to the United States from a temporary 
visit abroad and, if the stay abroad was protracted, this was caused by 
reasons beyond the alien's control and for which the alien was not 
responsible.
    (b) Documentation needed. Unless the consular officer has reason to 
question the legality of the alien's previous admission for permanent 
residence or the

[[Page 212]]

alien's eligibility to receive an immigrant visa, only those records and 
documents required under INA 222(b) which relate to the period of 
residence in the United States and the period of the temporary visit 
abroad shall be required. If any required record or document is 
unobtainable, the provisions of Sec. 42.65(d) shall apply.
    (c) Relief provisions for certain returning resident aliens under 
INA 212(c). The exercise by the Attorney General of discretionary 
authority under INA 212(c) to grant relief from certain grounds of 
ineligibility (other than those specified therein) to certain returning 
resident aliens shall remove the alien's ineligibility to receive a visa 
only under the conditions specified in the Attorney General's order. 
This relief shall not apply to an alien who has been convicted of an 
aggravated felony and has served a term of imprisonment of at least 5 
years.
    (d) Returning resident alien originally admitted under the Act of 
December 28, 1945. An alien admitted into the United States under 
Section 1 of the Act of December 28, 1945 (``GI Brides Act'') shall not 
be refused an immigrant visa after a temporary absence abroad solely 
because of a mental or physical defect or defects that existed at the 
time of the original admission.



Sec. 42.23  Certain former U.S. citizens.

    (a) Women expatriates. An alien woman, regardless of marital status, 
shall be classifiable as a special immigrant under INA 101(a)(27)(B) if 
the consular officer is satisfied by appropriate evidence that she was 
formerly a U.S. citizen and that she meets the requirements of INA 
324(a).
    (b) Military expatriates. An alien shall be classifiable as a 
special immigrant under INA 101(a)(27)(B) if the consular officer is 
satisfied by appropriate evidence that the alien was formerly a U.S. 
citizen and that the alien lost citizenship under the circumstances set 
forth in INA 327.



         Subpart D--Immigrants Subject to Numerical Limitations

    Source:  56 FR 49676, Oct. 1, 1991, unless otherwise noted.



Sec. 42.31  Family-sponsored immigrants.

    (a) Entitlement to status. An alien shall be classifiable as a 
family-sponsored immigrant under INA 203(a) (1), (2), (3) or (4) if the 
consular officer has received from INS a Petition to Classify Status of 
Alien Relative for Issuance of Immigrant Visa approved in accordance 
with INA 204 to accord the alien such preference status, or official 
notification of such an approval, and the consular officer is satisfied 
that the alien has the relationship to the petitioner indicated in the 
petition. In the case of a petition according an alien status under INA 
203(a) (1) or (3) or status as an unmarried son or daughter under INA 
203(a)(2), the petitioner must be a ``parent'' as defined in INA 
101(b)(2) and 22 CFR 40.1. In the case of a petition to accord an alien 
status under INA 203(a)(4) filed on or after January 1, 1977, the 
petitioner must be at least twenty-one years of age.
    (b) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the child of a family-sponsored 
first, second, third or fourth preference immigrant or the spouse of a 
family-sponsored third or fourth preference immigrant, if not otherwise 
entitled to an immigrant status and the immediate issuance of a visa, is 
entitled to a derivative status corresponding to the classification and 
priority date of the beneficiary of the petition.
[56 FR 49676, Oct. 1, 1991, as amended at 61 FR 1836, Jan. 24, 1996]



Sec. 42.32  Employment-based preference immigrants.

    Aliens subject to the worldwide level specified in section 201(d) 
for employment-based immigrants in a fiscal year shall be allotted visas 
as indicated below.
    (a) First preference--Priority workers--(1) Entitlement to status. 
An alien shall be classifiable as an employment-based first preference 
immigrant under INA 203(b)(1) if the consular office has received from 
INS a Petition for Immigrant Worker approved in accordance with INA 204 
to accord the alien such

[[Page 213]]

Preference status, or official notification of such an approval, and the 
consular officer is satisfied that the alien is within one of the 
classes described in INA 203(b)(1).
    (2) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the child or spouse of an 
employment-based first preference immigrant, if not otherwise entitled 
to an immigrant status and the immediate issuance of a visa, is entitled 
to a derivative status corresponding to the classification and priority 
date of the beneficiary of the petition.
    (b) Second preference--Professionals with advanced degrees or 
persons of exceptional ability--(1) Entitlement to status. An alien 
shall be classifiable as an employment-based second preference immigrant 
under INA 203(b)(2) if the consular officer has received from INS a 
Petition for Immigrant Worker approved in accordance with INA 204 to 
accord the alien such preference status, or official notification of 
such an approval, and the consular officer is satisfied that the alien 
is within one of the classes described in INA 203(b)(2).
    (2) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the child or spouse of an 
employment-based second preference immigrant, if not otherwise entitled 
to an immigrant status and the immediate issuance of a visa, is entitled 
to a derivative status corresponding to the classification and priority 
date of the beneficiary of the petition.
    (c) Third preference--Skilled workers, professionals, other 
workers--(1) Entitlement to status. An alien shall be classifiable as an 
employment-based third preference immigrant under INA 203(b)(3) if the 
consular officer has received from INS a Petition for Immigrant Worker 
approved in accordance with INA 204 to accord the alien such preference 
status, or official notification of such an approval, and the consular 
officer is satisfied that the alien is within one of the classes 
described in INA 203(b)(3).
    (2) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the child or spouse of an 
employment-based third preference immigrant, if not otherwise entitled 
to an immigrant status and the immediate issuance of a visa, is entitled 
to a derivative status corresponding to the classification and priority 
date of the beneficiary of the petition.
    (d) Fourth preference--Special immigrants--(1) Religious workers--
(i) Classification based on qualifications under INA 101(A)(27)(C). An 
alien shall be classifiable under INA 203(b)(4) as a special immigrant 
described in INA 101(a)(27)(C) if:
    (A) The consular officer has received a petition approved by INS to 
accord such classification, or an official notification of such 
approval; and
    (B) The consular officer is satisfied from the evidence presented 
that the alien qualifies under that section; or
    (C) The consular officer is satisfied the alien is the spouse or 
child of a religious worker so classified and is accompanying or 
following to join the principal alien.
    (ii) Timeliness of application. An immigrant visa issued under INA 
203(b)(4) to an alien described in INA 101(a)(27)(C), other than a 
minister of religion, who qualifies as a ``religious worker'' as defined 
in 8 CFR 204.5 shall bear the usual validity except that in no case 
shall it be valid later than September 30, 2000.
    (2) Certain U.S. Government employees--(i) General. (A) An alien is 
classifiable under INA 203(b)(4) as a special immigrant described in INA 
101(a)(27)(D) if a petition to accord such status has been approved by 
the Secretary of State. An alien may file such a petition only after, 
but within one year of, notification from the Department that the 
Secretary of State has approved a recommendation from the Principal 
Officer that special immigrant status be accorded the alien in 
exceptional circumstances and has found it in the national interest so 
to do.
    (B) An alien may qualify as a special immigrant under INA 
101(a)(27)(D) on the basis of employment abroad with more than one 
agency of the U.S. Government provided the total amount of full-time 
service with the U.S. Government is 15 years or more.
    (C) Pursuant to INA 203(d), and whether or not named in the 
petition,

[[Page 214]]

the spouse or child of an alien classified under INA 203(b)(4), if not 
entitled to an immigrant status and the immediate issuance of a visa, is 
entitled to a derivative status corresponding to the classification and 
priority date of the beneficiary of the petition.
    (ii) Special immigrant status for certain aliens employed at the 
United States mission in Hong Kong. (A) An alien employed at the United 
States Consulate General in Hong Kong under the authority of the Chief 
of Mission or an alien employed pursuant to section 5913 of title 5 of 
the United States Code is eligible for classification under INA 
203(b)(4) as a special immigrant described in INA 101(a)(27)(D) 
provided:
    (1) The alien has performed faithfully for a total of three years or 
more;
    (2) The alien is a member of the immediate family of an employee 
entitled to such special immigrant status; and
    (3) The welfare of the alien or the family member is subject to 
clear threat due directly to the employee's employment with the United 
States Government or under a United States Government official; and
    (4) Subsequent to the Secretary's approval of the Principal 
Officer's recommendation and finding it in the national interest to do 
so, but within one year thereof, the alien has filed a petition for 
status under INA 203(b)(4) which the Secretary has approved.
    (B) An alien desiring to benefit from this provision must seek such 
status not later than January 1, 2002.
    (C) For purposes of Sec. 42.32(d)(2)(ii)(A), the term member of the 
immediate family means the definition (as of November 29, 1990) in 
Volume 6 of the Foreign Affairs Manual, section 117k, of a relative who 
has been living with the employee in the same household.
    (iii) Priority date. The priority date of an alien seeking status 
under INA 203(b)(4) as a special immigrant described in INA 
101(a)(27)(D) shall be the date on which the petition to accord such 
classification is filed. The filing date of the petition is that on 
which a properly completed form and the required fee are accepted by a 
Foreign Service post.
    (iv) Petition validity. Except as noted in this paragraph, the 
validity of a petition approved for classification under INA 203(b)(4) 
shall be six months beyond the date of the Secretary of State's approval 
thereof or the availability of a visa number, whichever is later. In 
cases described in Sec. 42.32(d)(2)(ii), the validity of the petition 
shall not in any case extend beyond January 1, 2002.
    (v) Extension of petition validity. If the principal officer of a 
post concludes that circumstances in a particular case are such that an 
extension of the validity of the Secretary's approval of special 
immigrant status or of the petition would be in the national interest, 
the principal officer shall recommend to the Secretary of State that 
such validity be extended for not more than one additional year.
    (vi) Fees. The Secretary of State shall establish a fee for the 
filing of a petition to accord status under INA 203(b)(4) which shall be 
collected following notification that the Secretary has approved status 
as a special immigrant under INA 101(a)(27)(D) for the alien.
    (vii) Delegation of authority to approve petitions. The authority to 
approve petitions to accord status under INA 203(b)(4) to an alien 
described in INA 101(a)(27)(D) is hereby delegated to the chief consular 
officer at the post of recommendation or, in the absence of the consular 
officer, to any alternate approving officer designated by the principal 
officer. Such authority may not be exercised until the Foreign Service 
post has received formal notification of the Secretary's approval of 
special immigrant status for the petitioning alien.
    (3) Panama Canal employees--(i) Entitlement to status. An alien who 
is subject to the numerical limitations specified in section 3201(c) of 
the Panama Canal Act of 1979, Public Law 96-70, is classifiable under 
INA 203(b)(4) as a special immigrant described in INA 101(a)(27) (E), 
(F) or (G) if the consular officer has received a petition approved by 
INS to accord such classification, or official notification of such an 
approval, and the consular officer is satisfied that the alien is within 
one of the classes described in INA 101(a)(27) (E), (F), or (G).
    (ii) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or

[[Page 215]]

not named in the petition, the spouse or child of any alien classified 
under INA 203(b)(4) as a special immigrant qualified under this section, 
if not otherwise entitled to an immigrant status and the immediate 
issuance of a visa, is entitled to a derivative status corresponding to 
the classification and priority date of the beneficiary of the petition.
    (4) Spouse and children of certain foreign medical graduates. The 
accompanying spouse and children of a graduate of a foreign medical 
school or of a person qualified to practice medicine in a foreign state 
who has adjusted status as a special immigrant under the provisions of 
INA 101(a)(27)(H) are classifiable under INA 203(b)(4) as special 
immigrants defined in INA 101(a)(27)(H) if the consular officer has 
received an approved petition from INS which accords such status and the 
consular officer is satisfied that the alien is within the class 
described in INA 101(a)(27)(H).
    (5) Certain International Organization employees--(i) Entitlement to 
status. An alien is classifiable under INA 203(b)(4) as a special 
immigrant described in INA 101(a)(27)(I) if the consular officer has 
received a petition approved by the INS to accord such classification or 
official notification of such approval, and the consular officer is 
satisfied from the evidence presented that the alien is within one of 
the classes described in that section.
    (ii) Timeliness of application. An alien accorded status under INA 
203(b)(4) because of qualification under INA 101(a)(27)(I) must appear 
for a final visa interview and issuance of the immigrant visa within six 
months of establishing entitlement to status.
    (6) Certain juvenile court dependents. An alien shall be 
classifiable under INA 203(b)(4) as a special immigrant defined in INA 
101(a)(27)(J) if the consular officer has received from INS an approved 
petition to accord such status, or an official notification of such an 
approval, and the consular officer is satisfied the alien is within the 
class described in that section.
    (7) Certain members of the United States Armed Forces recruited 
abroad--(i) Entitlement to status. An alien is classifiable under INA 
203(b)(4) as a special immigrant described in INA 101(a)(27)(K) if the 
consular office has received a petition approved by the INS to accord 
such classification, or official notification of such an approval, and 
the consular officer is satisfied from the evidence presented that the 
alien is within the class described in INA 101(a)(27)(K).
    (ii) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the spouse or child of any alien 
classified under INA 203(b)(4) as a special immigrant qualified under 
this section, if not otherwise entitled to an immigrant status and the 
immediate issuance of a visa, is entitled to a derivative status 
corresponding to the classification and priority date of the beneficiary 
of the petition.
    (e) Fifth preference--Employment-creation immigrants--(1) 
Entitlement to status. An alien shall be classifiable as a fifth 
preference employment-creation immigrant if the consular officer has 
received from INS an approved petition to accord such status, or 
official notification of such an approval, and the consular officer is 
satisfied that the alien is within the class described in INA 203(b)(5).
    (2) Entitlement to derivative status. Pursuant to INA 203(d), and 
whether or not named in the petition, the spouse or child of an 
employment-based fifth preference immigrant, if not otherwise entitled 
to an immigrant status and the immediate issuance of a visa, is entitled 
to a derivative status corresponding to the classification and priority 
date of the beneficiary of the petition.
[56 FR 49676, Oct. 1, 1991, as amended at 56 FR 51172, Oct. 10, 1991; 56 
FR 55077, Oct. 24, 1991; 60 FR 35839, July 12, 1995; 63 FR 4394, Jan. 
29, 1998]



Sec. 42.33  Diversity immigrants.

    (a) General--(1) Eligibility to compete for consideration under 
section 203(c). An alien shall be eligible to compete for consideration 
for visa issuance under INA 203(c) during a fiscal year only if he or 
she is a native of a low-admission foreign state, as determined by the 
Attorney General pursuant to INA 203(c)(1)(E)(i), with respect to the 
fiscal year in question; and if he or she has at least a high school 
education or its

[[Page 216]]

equivalent or, within the five years preceding the date of application 
for a visa, has two years of work experience in an occupation requiring 
at least two years training or experience.
    (2) Definition of high school education or its equivalent. For the 
purposes of this section, the phrase high school education or its 
equivalent shall mean successful completion of a twelve-year course of 
elementary and secondary education in the United States or successful 
completion in another country of a formal course of elementary and 
secondary education comparable to completion of twelve years' elementary 
and secondary education in the United States.
    (3) Determinations of work experience. The most recent edition of 
the Dictionary of Occupational Titles published by the Employment and 
Training Administration, United States Department of Labor, shall be 
controlling in determining whether a particular occupation is one 
``which requires at least 2 years of training or experience'' as 
provided in INA 203(c)(2).
    (4) Limitation on number of petitions per year. No more than one 
petition may be submitted by, or on behalf of, any alien for 
consideration during any single fiscal year. If two or more petitions 
for any single fiscal year are submitted by, or on behalf of, any alien, 
all such petitions shall be void and the alien by or for whom submitted 
shall not be eligible for consideration for visa issuance during the 
fiscal year in question.
    (5) Northern Ireland. For purposes of determining eligibility to 
file a petition for consideration under INA 203(c) for a fiscal year, 
the districts comprising that portion of the United Kingdom of Great 
Britain and Northern Ireland, known as ``Northern Ireland'', shall be 
treated as a separate foreign state. The districts comprising ``Northern 
Ireland'' are Antrim, Ards, Armagh, Ballymena, Ballymoney, Banbridge, 
Belfast, Carrickfergus, Castlereagh, Coleraine, Cookstown, Craigavon, 
Down, Dungannon, Fermanagh, Larne, Limavady, Lisburn, Londonderry, 
Magherafelt, Moyle, Newry and Mourne, Newtownabbey, North Down, Omagh, 
and Strabane.
    (b) Petition for consideration--(1) Form of petition. An alien 
claiming to be entitled to compete for consideration under INA 203(c) 
shall file a petition for such consideration. The petition shall consist 
of a sheet of paper on which shall be typed or legibly printed in the 
Roman alphabet the petitioner's name; date and place of birth (including 
city and country, province or other political subdivision of the 
country); the country of which the alien claims to be a native, if other 
than the country of birth; name[s] and date[s] and place[s] of birth of 
spouse and child[ren], if any; a current mailing address; and location 
of consular office nearest to current residence or, if in the United 
States, nearest to last foreign residence prior to entry into the United 
States. The alien shall sign his or her signature on the sheet of paper, 
using his or her usual signature. The alien shall also affix to the 
sheet of paper a recent photograph of himself or herself. The photograph 
shall be 1\1/2\ inches square (37mm  x  37mm) and the alien shall 
clearly print his or her name in the Roman alphabet on the reverse of 
the photograph before affixing the photograph to the sheet of paper.
    (2) Submission of petition--(i) General. A petition for 
consideration for visa issuance under INA 203(c) shall be submitted by 
mail to the address designated by the Department for that purpose. The 
Department shall establish a period of not less than thirty days during 
each fiscal year during which petitions for consideration during the 
next following fiscal year may be submitted. Each fiscal year, the 
Department shall give timely notice of both the mailing address and the 
exact dates of the application period, through publication in the 
Federal Register and such other methods as will ensure the widest 
possible dissemination of the information, both abroad and within the 
United States.
    (ii) Form of mailing. Petitions for consideration under this section 
shall be submitted by normal surface or air mail only. Petitions 
submitted by hand, telegram, FAX, or by any means requiring any form of 
special handling or acknowledgement of receipt will not be given 
consideration. The petitioner shall type or print legibly, using the

[[Page 217]]

Roman alphabet, on the upper left-hand corner of the envelope in which 
the petition is mailed his or her full name and mailing address, and the 
name of the country of which the petitioner is a native, as shown on the 
petition itself. Envelopes shall be between 6 and 10 inches (15 cm to 25 
cm) in length and between 3 and one-half and 4 and one-half inches (9 cm 
to 11 cm) in width. Envelopes not bearing this information and/or not 
conforming to the restrictions as to size shall not be processed for 
consideration.
    (c) Processing of petitions. Envelopes received at the mailing 
address during the application period established for the fiscal year in 
question and meeting the requirements of subsection (b) shall be 
assigned a number in a separate numerical sequence established for each 
regional area specified in INA 203(c)(1)(F). Upon completion of the 
numbering of all envelopes, all numbers assigned for each region shall 
be separately rank-ordered at random by a computer using standard 
computer software for this purpose. The Department shall then select in 
the rank orders determined by the computer program a quantity of 
envelopes for each region estimated to be sufficient to ensure, to the 
extent possible, usage of all immigrant visas authorized under INA 
203(c) for the fiscal year in question.
    (d) Approval of petitions. Envelopes selected pursuant to paragraph 
(c) of this section shall be opened and reviewed. Petitions which are 
legible and contain the information specified in paragraph (b) of this 
section shall be approved for further consideration.
    (e) Validity of approved petitions. A petition approved pursuant to 
paragraph (d) of this section shall be valid for a period not to exceed 
Midnight of the last day of the fiscal year for which the petition was 
submitted.
    (f) Order of consideration. Further consideration for visa issuance 
of aliens whose petitions have been approved pursuant to paragraph (d) 
of this section shall be in the regional rank orders established 
pursuant to paragraph (c) of this section.
    (g) Further processing. The Department shall inform applicants whose 
petitions have been approved pursuant to paragraph (d) of this section 
of the steps necessary to meet the requirements of INA 222(b) in order 
to apply formally for an immigrant visa.
    (h) Maintenance of information concerning petitioners who are visa 
recipients. (1) The Department shall compile and maintain the following 
information concerning petitioners to whom immigrant visas are issued 
under INA 203(c):
    (i) age;
    (ii) country of birth;
    (iii) marital status;
    (iv) sex;
    (v) level of education; and
    (vi) occupation and level of occupational qualification.
    (2) Names of visa recipients shall not be maintained in connection 
with this information and the information shall be compiled and 
maintained in such form that the identity of visa recipients cannot be 
determined therefrom.
    (i) Processing fee. In addition to collecting the immigrant visa 
application and, if applicable, issuance fees, as provided in 
Sec. 42.71(b) of this part, the consular officer shall also collect from 
each applicant for a visa under the Diversity Immigrant Visa Program 
such processing fee as the Secretary of State shall prescribe.
[59 FR 15301, Mar. 31, 1994; as amended at 61 FR 1524, Jan. 22, 1996]



                          Subpart E--Petitions



Sec. 42.41  Effect of approved petition.

    Consular officers are authorized to grant to an alien the immediate 
relative or preference status accorded in a petition approved in the 
alien's behalf upon receipt of the approved petition or official 
notification of its approval. The status shall be granted for the period 
authorized by law or regulation. The approval of a petition does not 
relieve the alien of the burden of establishing to the satisfaction of 
the consular officer that the alien is eligible in all respects to 
receive a visa.
[56 FR 49682, Oct. 1, 1991]



Sec. 42.42  Petitions for immediate relative or preference status.

    Petition for immediate relative or preference status. The consular 
officer may

[[Page 218]]

not issue a visa to an alien as an immediate relative entitled to status 
under 201(b), a family-sponsored immigrant entitled to preference status 
under 203(a)(1)-(4), or an employment-based preference immigrant 
entitled to status under INA 203(b)(1)-(5), unless the officer has 
received a petition filed and approved in accordance with INA 204 or 
official notification of such filing and approval.
[56 FR 49682, Oct. 1, 1991]



Sec. 42.43  Suspension or termination of action in petition cases.

    (a) Suspension of action. The consular officer shall suspend action 
in a petition case and return the petition, with a report of the facts, 
for reconsideration by INS if the petitioner requests suspension of 
action, or if the officer knows or has reason to believe that approval 
of the petition was obtained by fraud, misrepresentation, or other 
unlawful means, or that the beneficiary is not entitled, for some other 
reason, to the status approved.
    (b) Termination of action. (1) The consular officer shall terminate 
action in a petition case upon receipt from INS of notice of revocation 
of the petition in accordance with INS regulations.
    (2) The consular officer shall terminate action in a petition case 
subject to the provisions of INA 203(g) in accordance with the 
provisions of Sec. 42.83.
[56 FR 49682, Oct. 1, 1991]



            Subpart F--Numerical Controls and Priority Dates

    Source:  56 FR 51174, Oct. 10, 1991, unless otherwise noted.



Sec. 42.51  Department control of numerical limitations.

    (a) Centralized control. (1) Centralized control of the numerical 
limitations on immigration specified in INA 201, 202, and 203 is 
established in the Department. The Department shall limit the number of 
immigrant visas that may be issued and the number of adjustments of 
status that may be granted to aliens subject to these numerical 
limitations to a number:
    (i) Not to exceed 27 percent of the world-wide total made available 
under INA 203 (a), (b) and (c) in any of the first three quarters of any 
fiscal year; and
    (ii) Not to exceed, in any month of a fiscal year, 10% of the world-
wide total made available under INA 203 (a), (b) and (c) plus any 
balance remaining from authorizations for preceding months in the same 
fiscal year.
    (2) The Department shall control the limitation set forth in section 
112 of the Immigration Act of 1990, under which not more than 10% of the 
total numbers plus any numbers remaining from authorizations for 
preceding months shall be allocated in any month of a fiscal year.
    (b) Allocation of numbers. Within the foregoing limitations, the 
Department shall allocate immigrant visa numbers for use in connection 
with the issuance of immigrant visas and adjustments based on the 
chronological order of the priority dates of visa applicants classified 
under INA 203 (a) and (b) reported by consular officers pursuant to 
Sec. 42.55(b) and of applicants for adjustment of status as reported by 
officers of the INS, taking into account the requirements of INA 202(e) 
in such allocations. In the case of applicants under INA 203(c), visa 
numbers shall be allocated within the limitation for each specified 
geographical region in the random order determined in accordance with 
sec. 42.33(c) of this part.
    (c) Recaptured visa numbers. An immigrant visa number shall be 
returned to the Department for reallocation within the fiscal year in 
which the visa was issued when:
    (1) An immigrant having an immigrant visa is excluded from the 
United States and deported;
    (2) An immigrant does not apply for admission to the United States 
before the expiration of the validity of the visa;
    (3) An alien having a preference immigrant visa is found not to be a 
preference immigrant; or
    (4) An immigrant visa is revoked pursuant to Sec. 42.82.
    (d) Aliens subject to Panama Canal Act. Centralized control of the 
numerical limitations on immigration specified in section 3201 of the 
Panama Canal Act of 1979 is established in the Department. The 
Department shall limit the

[[Page 219]]

number of visas that may be issued and the number of adjustments of 
status that may be granted to immigrants qualifying for visas under INA 
203(b)(4) as aliens described in INA 101(a)(27) (E), (F) and (G) to a 
number not to exceed a total of 5,000 in any fiscal year beginning on or 
after October 1, 1979. If an alien as so described is excluded from the 
United States and deported or does not apply for admission to the United 
States before the expiration of the validity of the visa, or if a visa 
issued to such an alien is revoked pursuant to Sec. 42.82, that fact 
shall be reported to the Department for recapture of the Panama Canal 
Act number.
[56 FR 51174, Oct. 10, 1991, as amended at 59 FR 15302, Mar. 31, 1994]



Sec. 42.52  Post records of visa applications.

    (a) Waiting list. Records of individual visa applicants entitled to 
an immigrant classification and their priority dates shall be maintained 
at posts at which immigrant visas are issued. These records shall 
indicate the chronological and preferential order in which consideration 
may be given to immigrant visa applications within the several immigrant 
classifications subject to the numerical limitations specified in INA 
201, 202, and 203. Similar records shall be kept for the classes 
specified in INA 201(b)(2) and 101(a)(27) (A) and (B) which are not 
subject to numerical limitations. The records which pertain to 
applicants subject to numerical limitations constitute ``waiting lists'' 
within the meaning of INA 203(e)(3) as redesignated by the Immigration 
Act of 1990.
    (b) Entitlement to immigrant classification. An alien shall be 
entitled to immigrant classification if the alien:
    (1) Is the beneficiary of an approved petition according immediate 
relative or preference status;
    (2) Has satisfied the consular officer that the alien is entitled to 
special immigrant status under INA(101)(a)(27) (A) or (B);
    (3) Is entitled to status as a Vietnam Amerasian under section 
584(b)(1) of section 101(e) of Public Law 100-202 as amended by Public 
Law 101-167 and re-amended by Public Law 101-513; or
    (4) Beginning in FY-95, is entitled to status as a diversity 
immigrant under INA 203(c).
    (c) Record made when entitlement to immigrant classification is 
established. (1) A record that an alien is entitled to an immigrant visa 
classification shall be made on Form OF-224, Immigrant Visa Control 
Card, or through the automated system in use at selected posts, whenever 
the consular officer is satisfied--or receives evidence--that the alien 
is within the criteria set forth in paragraph (b) of this section.
    (2) A separate record shall be made of family members entitled to 
derivative immigrant status whenever the consular officer determines 
that a spouse or child is chargeable to a different foreign state or 
other numerical limitation than the principal alien. The provisions of 
INA 202(b) are to be applied as appropriate when either the spouse or 
parent is reached on the waiting list.
    (3) A separate record shall be made of a spouse or child entitled to 
derivative immigrant status whenever the consular officer determines 
that the principal alien intends to precede the family.
[56 FR 51174, Oct. 9, 1991, as amended at 61 FR 1836, Jan. 24, 1996]



Sec. 42.53  Priority date of individual applicants.

    (a) Preference applicant. The priority date of a preference visa 
applicant under INA 203 (a) or (b) shall be the fiing date of the 
approved petition that accorded preference status.
    (b) Former Western Hemisphere applicant with priority date prior to 
January 1, 1977. Notwithstanding the provisions of paragraph (a) of this 
section, an alien who, prior to January 1, 1977, was subject to the 
numerical limitation specified in section 21(e) of the Act of October 3, 
1965, and who was registered as a Western Hemisphere immigrant with a 
priority date prior to January 1, 1977, shall retain that priority date 
as a preference immigrant upon approval of a petition according status 
under INA 203 (a) or (b).
    (c) Derivative priority date for spouse or child of principal alien. 
A spouse or child of a principal alien acquired prior to the principal 
alien's admission shall be

[[Page 220]]

entitled to the priority date of the principal alien, whether or not 
named in the immigrant visa application of the principal alien. A child 
born of a marriage which existed at the time of a principal alien's 
admission to the United States is considered to have been acquired prior 
to the principal alien's admission.



Sec. 42.54  Order of consideration.

    (a) General. Consular officers shall request applicants to take the 
steps necessary to meet the requirements of INA 222(b) in order to apply 
formally for a visa as follows:
    (1) In the chronological order of the priority dates of all 
applicants within each of the immigrant classifications specified in INA 
203 (a) and (b); and
    (2) Beginning with fiscal year 1995, in the random order established 
by the Secretary of State for each region for the fiscal year for 
applicants entitled to status under INA 203(c).
    (b) [Reserved]
[56 FR 51174, Oct. 10, 1991, as amended at 59 FR 15302, Mar. 31, 1994; 
61 FR 1836, Jan. 24, 1996]



Sec. 42.55  Reports on numbers and priority dates of applications on record.

    (a) Consular officers shall report periodically, as the Department 
may direct, the number and priority dates of all applicants subject to 
the numerical limitations prescribed in INA 201, 202, and 203 whose 
immigrant visa applications have been recorded in accordance with 
Sec. 42.52(c).
    (b) Documentarily qualified applicants. Consular officers shall also 
report periodically, as the Department may direct, the number and 
priority dates of all applicants described in paragraph (a) of this 
section who have informed the consular office that they have obtained 
the documents required under INA 222(b), for whom the necessary 
clearance procedures have been completed.
[56 FR 51174, Oct. 10, 1991, as amended at 61 FR 1836, Jan. 24, 1996]



               Subpart G--Application for Immigrant Visas



Sec. 42.61  Place of application.

    (a) Alien to apply in consular district of residence. Unless 
otherwise directed by the Department, an alien applying for an immigrant 
visa shall make application at the consular office having jurisdiction 
over the alien's place of residence; except that, unless otherwise 
directed by the Department, an alien physically present in an area but 
having no residence therein may make application at the consular office 
having jurisdiction over that area if the alien can establish that he or 
she will be able to remain in the area for the period required to 
process the application. Finally, a consular office may, as a matter of 
discretion, or shall, at the direction of the Department, accept an 
immigrant visa application from an alien who is neither a resident of, 
nor physically present in, the area designated for that office for such 
purpose. For the purposes of this section, an alien physically present 
in the United States shall be considered to be a resident of the area of 
his or her last residence prior to entry into the United States.
    (b) Transfer of immigrant visa cases. (1) All documents, papers, and 
other evidence relating to an applicant whose case is pending or has 
been refused at one post may be transferred to another post at the 
applicant's request and risk when there is reasonable justification for 
the transfer and the transferring post has no reason to believe that the 
alien will be unable to appear at the receiving post.
    (2) Any approved petition granting immediate relative or preference 
status should be included among the documents when a case is transferred 
from one post to another.
    (3) In no case may a visa number be transferred from one post to 
another. A visa number which cannot be used as a result of the transfer 
must be returned to the Department immediately.
[52 FR 42613, Nov. 5, 1987, as amended at 59 FR 39955, Aug. 4, 1994]

[[Page 221]]



Sec. 42.62  Personal appearance and interview of applicant.

    (a) Personal appearance of applicant before consular officer. Every 
alien applying for an immigrant visa, including an alien whose 
application is executed by another person pursuant to Sec. 42.63(a)(2), 
shall be required to appear personally before a consular officer for the 
execution of the application or, if in Taiwan, before a designated 
officer of the American Institute in Taiwan, except that the personal 
appearance of any child under the age of 14 may be waived at the 
officer's discretion.
    (b) Interview by consular officer. Every alien executing an 
immigrant visa application must be interviewed by a consular officer who 
shall determine on the basis of the applicant's representations and the 
visa application and other relevant ducumentation--
    (1) The proper immigrant classification, if any, of the visa 
applicant, and
    (2) The applicant's eligibility to receive a visa.

The officer has the authority to require that the alien answer any 
question deemed material to these determinations.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49682, Oct. 1, 1991]



Sec. 42.63  Application forms and other documentation.

    (a) Application Forms--(1) Application on Form OF-230 Required. 
Every alien applying for an immigrant visa must make application on Form 
OF-230, Application for Immigrant Visa and Alien Registration. This 
requirement may not be waived. Form OF-230 consists of parts I and II 
which, together, are meant in any reference to this Form.
    (2) Application of alien under 14 or physically incapable. The 
application on Form OF-230 for an alien under 14 years of age or one 
physically incapable of completing an application may be executed by the 
alien's parent or guardian, or, if the alien has no parent or guardian, 
by any person having legal custody of, or a legitimate interest in, the 
alien.
    (b) Preparation of forms. The consular officer shall ensure that 
Form OF-230 and all other forms an alien is required to submit are fully 
and properly completed in accordance with the applicable regulations and 
instructions.
    (c) Additional information as part of application. The officer may 
require the submission of additional information or question the alien 
on any relevant matter whenever the officer believes that the 
information provided in Form OF-230 is inadequate to determine the 
alien's eligibility to receive an immigrant visa. Additional statements 
made by the alien become a part of the visa application. All documents 
required under the authority of Sec. 42.62 are considered papers 
submitted with the alien's application within the meaning of INA 
221(g)(1).
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49682, Oct. 1, 1991; 61 
FR 1836, Jan. 24, 1996]



Sec. 42.64  Passport requirements.

    (a) Passport defined. Passport, as defined in INA 101(a)(30), is not 
limited to a national passport or to a single document. A passport may 
consist of two or more documents which, when considered together, 
fulfill the requirements of a passport, provided that documentary 
evidence of permission to enter a foreign country has been issued by a 
competent authority and clearly meets the requirements of INA 
101(a)(30).
    (b) Passport validity requirements. Except as provided in Sec. 42.2, 
every applicant for an immigrant visa shall present a passport, as 
defined in INA 101(a)(30), that is valid for at least 60 days beyond the 
period of validity of the visa. The 60-day additional validity 
requirement does not apply to an applicant who would be excepted as 
provided in Sec. 42.2 were it not for the fact that the applicant is 
applying in the country of which the applicant is a national and the 
possession of a passport is required for departure. Such an applicant 
may be issued a visa valid for 4 months or for such shorter period as 
will assure its expiration in unison with the passport.
    (c) A single passport including more than one person. The passport 
requirement of this section may be met by the presentation of a passport 
including more than one person, if such inclusion is authorized under 
the laws or regulations of the issuing authority and if a photograph of 
each person 16 years of

[[Page 222]]

age or over is attached to the passport by the issuing authority.
[52 FR 42613, Nov. 5, 1987; 53 FR 9112, Mar. 21, 1988]



Sec. 42.65  Supporting documents.

    (a) Authority to require documents. The consular officer is 
authorized to require documents considered necessary to establish the 
alien's eligibility to receive an immigrant visa. All such documents 
submitted and other evidence presented by the alien, including briefs 
submitted by attorneys or other representatives, shall be considered by 
the officer.
    (b) Basic documents required. An alien applying for an immigrant 
visa shall be required to furnish, if obtainable: A copy of a police 
certificate or certificates; a certified copy of any existing prison 
record, military record, and record of birth; and a certified copy of 
all other records or documents which the consular officer considers 
necessary.
    (c) Definitions. (1) Police certificate means a certification by the 
police or other appropriate authorities reporting information entered in 
their records relating to the alien. In the case of the country of an 
alien's nationality and the country of an alien's current residence (as 
of the time of visa application) the term ``appropriate police 
authorities'' means those of a country, area or locality in which the 
alien has resided for at least six months. In the case of all other 
countries, areas, or localities, the term ``appropriate police 
authorities'' means the authorities of any country, area, or locality in 
which the alien has resided for at least one year. A consular officer 
may require a police certificate regardless of length of residence in 
any country if he or she has reason to believe that a police record 
exists in the country, area, or locality concerned.
    (2) Prison record means an official document containing a report of 
the applicant's record of confinement and conduct in a penal or 
correctional institution.
    (3) Military record means an official document containing a complete 
record of the applicant's service and conduct while in military service, 
including any convictions of crime before military tribunals as 
distinguished from other criminal courts. A certificate of discharge 
from the military forces or an enrollment book belonging to the 
applicant shall not be acceptable in lieu of the official military 
record, unless it shows the alien's complete record while in military 
service. The applicant may, however, be required to present for 
inspection such a discharge certificate or enrollment book if deemed 
necessary by the consular officer to establish the applicant's 
eligibility to receive a visa.
    (4) A certified copy of an alien's record of birth means a 
certificate issued by the official custodian of birth records in the 
country of birth showing the date and place of birth and the parentage 
of the alien, based upon the original registration of birth.
    (5) Other records or documents include any records or documents 
establishing the applicant's relationship to a spouse or children, if 
any, and any records or documents pertinent to a determination of the 
applicant's identity, classification, or any other matter relating to 
the applicant's visa eligibility.
    (d) Unobtainable documents. (1) If the consular officer is 
satisfied, or the catalogue of available documents prepared by the 
Department indicates, that any document or record required under this 
section is unobtainable, the officer may permit the immigrant to submit 
other satisfactory evidence in lieu of such document or record. A 
document or other record shall be considered unobtainable if it cannot 
be procured without causing to the applicant or a family member actual 
hardship as opposed to normal delay and inconvenience.
    (2) If the consular officer determines that a supporting document, 
as described in paragraph (b) of this section, is in fact unobtainable, 
although the catalogue of available documents shows it is available, the 
officer shall affix to the visa application a signed statement 
describing in detail the reasons for considering the record or document 
unobtainable and for accepting the particular secondary evidence 
attached to the visa.
    (e) Authenticity of records and documents. If the consular officer 
has reason to believe that a required record or

[[Page 223]]

document submitted by an applicant is not authentic or has been altered 
or tampered with in any material manner, the officer shall take such 
action as may be necessary to determine its authenticity or to ascertain 
the facts to which the record or document purports to relate.
    (f) Photographs. Every alien shall furnish color photographs of the 
number and specifications prescribed by the Department, except that, in 
countries where facilities for producing color photographs are 
unavailable as determined by the consular officer, black and white 
photographs may be substituted.
[52 FR 42613, Nov. 5, 1987, as amended at 55 FR 29015, July 17, 1990; 56 
FR 49682, Oct. 1, 1991]



Sec. 42.66  Medical examination.

    (a) Medical examination required of all applicants. Before the 
issuance of an immigrant visa, the consular officer shall require every 
alien, regardless of age, to undergo a medical examination in order to 
determine eligibility to receive a visa.
    (b) Examination by physician from approved panel. The required 
examination shall be conducted in accordance with requirements and 
procedures established by the United States Public Health Service and by 
a physician selected by the alien from a panel of physicians approved by 
the consular officer.
    (c) Facilities required for panel physician. A consular officer 
shall not include the name of a physician on the panel of physicians 
referred to in paragraph (b) of this section unless the physician has 
facilities to perform required serological and X-ray tests or is in a 
position to refer applicants to a qualified laboratory for such tests.



Sec. 42.67  Execution of application, registration, and fingerprinting.

    (a) Execution of visa application--(1) Application fee. A fee is 
prescribed for each application for an immigrant visa. It shall be 
collected prior to the execution of the application and a receipt shall 
be issued.
    (2) Oath and signature. The applicant shall be required to read the 
Form OF-230, Application for Immigrant Visa and Alien Registration, when 
it is completed, or it shall be read to the alien in the alien's 
language, or the alien otherwise informed of its full contents. Aliens 
shall be asked whether they are willing to subscribe thereto. If the 
alien is not willing to subscribe to the application unless changes are 
made in the information stated therein, the required changes shall be 
made. The application shall then be sworn to or affirmed and signed by 
or on behalf of the applicant before a consular officer, or a designated 
officer of the American Institute of Taiwan, who shall then sign the 
application over the officer's title.
    (b) Registration. Form OF-230, when duly executed, shall constitute 
the alien's registration record for the purposes of INA 221(b).
    (c) Fingerprinting. An alien may be required at any time prior to 
the execution of Form OF-230 to have a set of fingerprints taken if such 
procedure is necessary for purposes of identification or investigation.
[52 FR 42613, Nov. 5, 1987, as amended at 55 FR 29015, July 17, 1990; 56 
FR 49682, Oct. 1, 1991]



Sec. 42.68  Informal evaluation of family members if principal applicant precedes them.

    (a) Preliminary determination of visa eligibility. If a principal 
applicant proposes to precede the family to the United States, the 
consular officer may arrange for an informal examination of the other 
members of the principal applicant's family in order to determine 
whether there exists at that time any mental, physical, or other ground 
of ineligibility on their part to receive a visa.
    (b) When family member ineligible. In the event the consular officer 
finds that any member of such family would be ineligible to receive an 
immigrant visa, the principal applicant shall be informed and required 
to acknowledge receipt of this information in writing.
    (c) No guarantee of future eligibility. A determination in 
connection with an informal examination that an alien appears to be 
eligible for a visa carries no assurance that the alien will be issued 
an immigrant visa in the future. The

[[Page 224]]

principal applicant shall be so informed and required to acknowledge 
receipt of this information in writing. The question of visa eligibility 
can be determined definitively only at the time the family member 
applies for a visa.



                 Subpart H--Issuance of Immigrant Visas



Sec. 42.71  Authority to issue visas; visa fees.

    (a) Authority to issue visas. Consular officers are authorized to 
issue immigrant visas at designated consular offices abroad pursuant to 
INA 101(a)(16), 221(a), and 224. (Consular offices authorized to issue 
immigrant visas are listed periodically in Visa Office Bulletins 
published by the Department of State.) A consular officer assigned to 
duty in the territory of a country against which the sanctions provided 
in INA 243(g) have been invoked shall not issue an immigrant visa to an 
alien who is a national, citizen, subject, or resident of that country, 
unless the officer has been informed that the sanction has been waived 
by INS in the case of an individual alien or a specified class of 
aliens.
    (b) Immigrant visa fees. Fees are prescribed by the Secretary of 
State for the execution of an application for, and the issuance of, an 
immigrant visa. The application fee shall be collected prior to the visa 
interview and execution of the application. The issuance fee shall be 
collected after completion of the visa interview and prior to issuance 
of the visa. A fee receipt shall be issued for each fee. A fee collected 
for the application for or issuance of an immigrant visa is refundable 
only if the principal officer at a post or the officer in charge of a 
consular section determines that the visa was issued in error or could 
not be used as a result of action by the U.S. Government over which the 
alien had no control and for which the alien was not responsible.



Sec. 42.72  Validity of visas.

    (a) Period of validity. With the exception indicated herein, the 
period of validity of an immigrant visa shall not exceed six months, 
beginning with the date of issuance. Any visa issued to a child lawfully 
adopted by a U.S. citizen and spouse while such citizen is serving 
abroad in the U.S. Armed Forces, is employed abroad by the U.S. 
Government, or is temporarily abroad on business, however, shall be 
valid until such time, for a period not to exceed 3 years, as the 
adoptive citizen parent returns to the United States in the course of 
that parent's military service, U.S. Government employment, or business.
    (b) Extension of period of validity. If the visa was originally 
issued for a period of validity less than the maximum authorized by 
paragraph (a) of this section, the consular officer may extend the 
validity of the visa up to but not exceeding the maximum period 
permitted. If an immigrant applies for an extension at a consular office 
other than the issuing office, the consular officer shall, unless the 
officer is satisfied beyond doubt that the alien is eligible for the 
extension, communicate with the issuing office to determine if there is 
any objection to an extension. In extending the period of validity, the 
officer shall make an appropriate notation on the visa of the new 
expiration date, sign the document with title indicated, and impress the 
seal of the office thereon.
    (c) No fee for extension of period of validity. No fee shall be 
charged for extending the period of validity of an immigrant visa.
    (d) Age and marital status in relation to validity of certain 
immigrant visas. In accordance with Sec. 42.64(b), the validity of a 
visa may not extend beyond a date sixty days prior to the expiration of 
the passport. The period of validity of a visa issued to an immigrant as 
a child shall not extend beyond the day immediately proceding the date 
on which the alien becomes 21 years of age. The consular officer shall 
warn an alien, when appropriate, that the alien will be admissible as 
such an immigrant only if unmarried and under 21 years of age at the 
time of application for admission at a U.S. port of entry. The consular 
officer shall also warn an alien issued a visa as a first or second 
preference immigrant as an unmarried son or daughter of a citizen or 
lawful permanent resident of the United States that the alien will be 
admissible

[[Page 225]]

as such an immigrant only if unmarried at the time of application for 
admission at a U.S. port of entry.
    (e) Aliens entitled to the benefits of sections 154 (a) and (b) of 
Pub. L. 101-649. (1) Notwithstanding the provisions of paragraphs (a) 
through (d) of this section, the period of validity of an immigrant visa 
issued to an immigrant described in paragraph (e)(2) of this section 
may, at the request of the applicant, be extended until January 1, 2002, 
if the applicant so requests either at the time of issuance of the visa 
or within six months thereafter. If an applicant entitled to issuance of 
an immigrant visa having an extended period of validity fails to request 
extended validity at the time of issuance but subsequently, within six 
months thereafter, requests that the validity be extended pursuant to 
this paragraph, the consular officer shall issue a replacement visa to 
the alien in accordance with the provisions of Sec. 42.74(b).
    (2) An immigrant may request the extended period of validity 
provided for in paragraph (e)(1) of this section if he or she is
    (i) Resident in Hong Kong as of the date of enactment of Public Law 
101-649;
    (ii) Chargeable to the foreign state limitation for Hong Kong; and
    (iii) Classifiable, during fiscal year 1991, as a preference 
immigrant under section 203(a) (1), (2), (4), or (5) of the INA or, 
during fiscal year 1992 and thereafter, as a preference immigrant under 
section 203(a) (1), (2), (3), or (4), or 203(b)(1) of the INA.
    (3) An alien who elects to have the period of validity of his or her 
immigrant visa extended as provided in paragraph (e)(1) of this section 
and whose entitlement to the immigrant classification of such visa was 
based upon his or her status as a child at the time of issuance shall 
not cease to be entitled to such visa by reason of attaining age twenty-
one or marrying prior to his or her application for admission into the 
United States.
    (4) An alien who has elected to have the period of validity of his 
or her visa extended pursuant to paragraph (e)(1) of this section shall, 
if his or her contemplated date of application for admission into the 
United States is no later than six months following the date of visa 
issuance, notify the appropriate consular officer of his or her 
intention to travel to the United States for this purpose. The consular 
officer shall thereupon schedule an appointment with such alien for the 
purpose of determining whether or not the alien remains admissible into 
the United States as an immigrant. Such appointment shall be scheduled 
not sooner than six months preceding the alien's contemplated date of 
application for admission for permanent residence. If the consular 
officer determines that the alien continues to be admissible to the 
United States as an immigrant, he or she shall issue to the alien a 
duplicate immigrant visa as provided in Sec. 42.74 of this part except 
that the alien shall pay only a new issuance fee. If the consular 
officer determines that the alien has become inadmissible to the United 
States as an immigrant, he or she shall revoke the visa as provided in 
Sec. 42.82 of this part. A consular officer who issues a visa having an 
extended period of validity pursuant to this paragraph shall, at the 
time of visa issuance, inscribe on the face of the visa ``Section 154 
applies'' and shall notify in writing the alien concerned of this 
requirement.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 32323, July 16, 1991; 61 
FR 1836, Jan. 24, 1996; 62 FR 27694, May 21, 1997]



Sec. 42.73  Procedure in issuing visas.

    (a) Insertion of data. In issuing an immigrant visa, the issuing 
office shall insert the pertinent information in the designated blank 
spaces provided on Form OF-155A, Immigrant Visa and Alien Registration, 
in accordance with the instructions contained in this section.
    (1) A symbol as specified in Sec. 42.11 shall be used to indicate 
the classification of the immigrant.
    (2) An immigrant visa issued to an alien subject to numerical 
limitations shall bear a number allocated by the Department. The foreign 
state or dependent area limitation to which the alien is chargeable 
shall be entered in the space provided.
    (3) No entry need be made in the space provided for foreign state or 
other applicable area limitation on

[[Page 226]]

visas issued to aliens in the classifications set forth in 
Sec. 42.12(a)(1)-(7), but such visas may be numbered if a post 
voluntarily uses a consecutive post numbering system.
    (4) The date of issuance and the date of expiration of the visa 
shall be inserted in the proper places on the visa and show the day, 
month, and year in that order, with the name of the month spelled out, 
as in ``24 December 1986.''
    (5) In the event the passport requirement has been waived under 
Sec. 42.2, a notation shall be inserted in the space provided for the 
passport number, setting forth the authority (section and paragraph) 
under which the passport was waived.
    (6) A signed photograph shall be attached in the space provided on 
Form OF-155A by the use of a legend machine, unless specific 
authorization has been granted by the Department to use the impression 
seal.
    (b) Documents comprising an immigrant visa. An immigrant visa 
consists of Form OF-155A and Form OF-230, Application for Immigrant Visa 
and Alien Registration, properly executed, and a copy of each document 
required pursuant to Sec. 42.63.
    (c) Arrangement of visa documentation. Form OF-155A shall be placed 
immediately above Form OF-230 and the supporting documents attached 
thereto. Any document required to be attached to the visa, if furnished 
to the consular officer by the alien's sponsor or other person with a 
request that the contents not be divulged to the visa applicant, shall 
be placed in an envelope and sealed with the impression seal of the 
consular office before being attached to the visa. If an immigrant visa 
is issued to an alien in possession of a United States reentry permit, 
valid or expired, the consular officer shall attach the permit to the 
immigrant visa for disposition by INS at the port of entry. (Documents 
having no bearing on the alien's qualifications or eligiblity to receive 
a visa may be returned to the alien or to the person who furnished 
them.)
    (d) Signature, seal, and issuance of visa. The consular officer 
shall sign the visa (Form OF-155A) and impress the seal of the office on 
it so as to partially cover the photograph and the signature. The 
immigrant visa shall then be issued by delivery to the immigrant or the 
immigrant's authorized agent or representative.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49682, Oct. 1, 1991]



Sec. 42.74  Issuance of new or replacement visas.

    (a) New immigrant visa for a special immigrant under INA 
101(a)(27)(A) and (B).
    (1) The consular officer may issue a new immigrant visa to a 
qualified alien entitled to status under INA 101(a)(27)(A) or (B), who 
establishes:
    (i) That the original visa has been lost, mutilated or has expired, 
or
    (ii) The alien will be unable to use it during the period of its 
validity;
    (2) Provided:
    (i) The alien pays anew the statutory application and issuance fees; 
and
    (ii) The consular officer ascertains whether the original issuing 
office knows of any reason why a new visa should not be issued.
    (b) Replacement immigrant visa for an immediate relative or for an 
alien subject to numerical limitation.
    (1) A consular officer may issue a replacement visa under the 
original number of a qualified alien entitled to status under INA 
201(b)(2)(A)(i), INA 203(a), (b), or (c), or under INA 124, if--
    (i) The alien is unable to use the visa during the period of its 
validity due to reasons beyond the alien's control;
    (ii) The visa is issued during the same fiscal year in which the 
original visa was issued;
    (iii) The number has not been returned to the Department as a 
``recaptured visa number'';
    (iv) The alien pays anew the statutory application and issuance 
fees; and
    (v) The consular officer ascertain whether the original issuing 
office or knows of any reason why a new visa should not be issued.
    (2) In issuing a visa under this paragraph (b), the consular officer 
shall insert the word ``REPLACE'' on Form OF-155A, Immigrant Visa and 
Alien Registration, before the word ``IMMIGRANT'' in the title of the 
visa.
    (c) Duplicate visas issued within the validity period of the 
original visa. If the validity of a visa previously issued has not yet 
terminated and the original

[[Page 227]]

visa has been lost or mutilated, a duplicate visa may be issued 
containing all of the information appearing on the original visa, 
including the original issuance and expiration dates. The applicant 
shall execute a new application and provide copies of the supporting 
documents submitted in support of the original application. The alien 
must pay anew the application and issuance fees. In issuing a visa under 
this paragraph, the consular officer shall insert the word ``DUPLICATE'' 
on Form OF-155A before the word ``IMMIGRANT'' in the title of the visa.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49682, Oct. 1, 1991; 61 
FR 1836, Jan. 24, 1996; 63 FR 4393, Jan. 29, 1998]



     Subpart I--Refusal, Revocation, and Termination of Registration



Sec. 42.81  Procedure in refusing individual visas.

    (a) Issuance or refusal mandatory. When a visa application has been 
properly completed and executed before a consular officer in accordance 
with the provisions of INA and the implementing regulations, the 
consular officer shall either issue or refuse the visa. Every refusal 
shall be in conformance with the provisions of 22 CFR 40.6.
    (b) Refusal procedure. A consular officer may not refuse an 
immigrant visa until Form OF-230, Application for Immigrant Visa and 
Alien Registration, has been executed by the applicant. When an 
immigrant visa is refused, an appropriate record shall be made in 
duplicate on a form prescribed by the Department. The form shall be 
signed and dated by the consular officer. The consular officer shall 
inform the applicant of the provision of law or implementing regulation 
on which the refusal is based and of any statutory provisions under 
which administrative relief is available. Each document related to the 
refusal shall then be attached to Form OF-230 for retention in the 
refusal files. Any documents not related to the refusal shall be 
returned to the applicant. If the grounds of ineligibility may be 
overcome by the presentation of additional evidence and the applicant 
indicates an intention to submit such evidence, all documents may, with 
the consent of the alien, be retained in the consular files for a period 
not to exceed one year. If the refusal has not been overcome within one 
year, any documents not relating to the refusal shall be removed from 
the file and returned to the alien.
    (c) Review of refusal at consular office. If the grounds of 
ineligibility upon which the visa was refused cannot be overcome by the 
presentation of additional evidence, the principal consular officer at a 
post, or a specifically designated alternate, shall review the case 
without delay, record the review decision, and sign and date the 
prescribed form. If the grounds of ineligibility may be overcome by the 
presentation of additional evidence and the applicant indicates the 
intention to submit such evidence, a review of the refusal may be 
deferred. If the principal consular officer or alternate does not concur 
in the refusal, that officer shall either (1) refer the case to the 
Department for an advisory opinion, or (2) assume responsibility for 
final action on the case.
    (d) Review of refusal by Department. The Department may request a 
consular officer in an individual case or in specified classes of cases 
to submit a report if an immigrant visa has been refused. The Department 
will review each report and may furnish an advisory opinion to the 
consular officer for assistance in considering the case further. If the 
officer believes that action contrary to an advisory opinion should be 
taken, the case shall be resubmitted to the Department with an 
explanation of the proposed action. Rulings of the Department concerning 
an interpretation of law, as distinguished from an application of the 
law to the facts, are binding upon consular officers.
    (e) Reconsideration of refusal. If a visa is refused, and the 
applicant within one year from the date of refusal adduces further 
evidence tending to overcome the ground of ineligibility on which the 
refusal was based, the case shall be reconsidered. In such circumstance, 
an additional application fee shall not be required.
[52 FR 42613, Nov. 5, 1987; 53 FR 9112, Mar. 21, 1988]

[[Page 228]]



Sec. 42.82  Revocation of visas.

    (a) Grounds for revocation. Consular officers are authorized to 
revoke an immigrant visa under the following circumstances:
    (1) The consular officer knows, or after investigation is satisfied, 
that the visa was procured by fraud, a willfully false or misleading 
representation, the willful concealment of a material fact, or other 
unlawful means;
    (2) The consular officer obtains information establishing that the 
alien was otherwise ineligible to receive the particular visa at the 
time it was issued; or
    (3) The consular officer obtains information establishing that, 
subsequent to the issuance of the visa, a ground of ineligibility has 
arisen in the alien's case.
    (b) Notice of proposed revocation. The bearer of an immigrant visa 
which is being considered for revocation shall, if practicable, be 
notified of the proposed action, given an opportunity to show cause why 
the visa should not be revoked, and requested to present the visa to the 
consular office indicated in the notification of proposed cancellation.
    (c) Procedure in revoking visas. An immigrant visa which is revoked 
shall be canceled by writing the word ``REVOKED'' plainly across the 
face of the visa. The cancellation shall be dated and signed by the 
consular officer taking the action. The failure of an alien to present 
the visa for cancellation does not affect the validity of any action 
taken to revoke it.
    (d) Notice to carriers. Notice of revocation of a visa shall be 
given to the master, commanding officer, agent, owner, charterer, or 
consignee of the carrier or transportation line on which it is believed 
the alien intends to travel to the United States, unless the visa has 
been canceled as provided in paragraph (c) of this section.
    (e) Notice to Department. The consular officer shall promptly submit 
notice of the revocation, including a full report of the facts in the 
case, to the Department for transmission to the INS. A report is not 
required if the visa has been physically canceled prior to the alien's 
departure for the United States.
    (f) Record of action. Upon the revocation of an immigrant visa, the 
consular officer shall make appropriate notation for the post file of 
the action taken, including a statement of the reasons therefor, and if 
the revocation of the visa is effected at other than the issuing office, 
a report of the action taken shall be sent to that office.
    (g) Reconsideration of revocation. (1) The consular officer shall 
consider any evidence submitted by the alien or the alien's attorney or 
representative in connection with a request that the revocation of the 
visa be reconsidered. If the officer finds that the evidence is 
sufficient to overcome the basis for the revocation, a new visa shall be 
issued. A memorandum regarding the action taken and the reasons 
therefore shall be placed in the consular files and appropriate 
notification made promptly to the carriers concerned, the Department, 
and the issuing office if notice of revocation has been given in 
accordance with paragraphs (d), (e), and (f) of this section.
    (2) In view of the provisions of Sec. 42.71(b) providing for the 
refund of fees when the visa has not been used as a result of action by 
the U.S. Government, no fees shall be collected in connection with the 
application for or issuance of such a reinstated visa.



Sec. 42.83  Termination of registration.

    (a) Termination following failure of applicant to apply for visa. In 
accordance with INA 203(g), an alien's registration for an immigrant 
visa shall be terminated if, within one year after transmission of a 
notification of the availability of an immigrant visa, the applicant 
fails to apply for an immigrant visa.
    (b) Termination following visa refusal. An alien's registration for 
an immigrant visa shall be terminated if, within one year following the 
refusal of the immigrant visa application under INA 221(g), the alien 
has failed to present to a consular officer evidence purporting to 
overcome the basis for refusal.
    (c) Notice of termination. Upon the termination of registration 
under paragraph (a) or (b) of this section, the consular officer at the 
post where the alien is registered shall notify the alien of the 
termination. The consular officer

[[Page 229]]

shall also inform the alien of the right to have the registration 
reinstated if the alien, before the end of the second year after the 
missed appointment date if paragraph (a) applies, and before the end of 
the second year after the INA 221(g) refusal if paragraph (b) applies, 
establishes to the satisfaction of the consular officer that the failure 
to apply for an immigrant visa or to present evidence purporting to 
overcome the ineligibility under INA 221(g) was due to circumstances 
beyond the alien's control.
    (d) Reinstatement of registration. If the consular officer is 
satisfied that an alien, as provided for in paragraph (c) of this 
section, has established that failure to apply as scheduled for an 
immigrant visa or to present evidence purporting to overcome 
ineligibility under INA 221(g) was due to circumstances beyond the 
alien's control, the consular officer shall reinstate the alien's 
registration for an immigrant visa. Any petition approved under INA 
204(b) which had been automatically revoked as a result of the 
termination of registration shall be considered to be automatically 
reinstated if the registration is reinstated.
    (e) Interpretation of ``circumstances beyond alien's control''. For 
the purpose of this section, the term ``circumstances beyond the alien's 
control'' includes, but is not limited to, an illness or other physical 
disability preventing the alien from traveling, a refusal by the 
authorities of the country of an alien's residence to grant the alien 
permission to depart as an immigrant, and foreign military service.
[52 FR 42613, Nov. 5, 1987, as amended at 56 FR 49682, Oct. 1, 1991]



PARTS 43-44--(RESERVED)






PART 45--VISAS: DOCUMENTATION OF IMMIGRANTS UNDER SECTION 124 OF PUBLIC LAW 101-649--Table of Contents




Sec.
45.1  General.
45.2  Priority date of applicants.
45.3  Control of numerical limitations.
45.4  Period of validity of immigrant visas.
45.5  Redetermination of admissibility if visa validity extended.
45.6  Issuance of immigrant visa upon redetermination of admissibility.

    Authority:  8 U.S.C. 1104; 8 U.S.C. 1153 Note, unless otherwise 
noted.

    Source:  56 FR 32506, July 17, 1991, unless otherwise noted.



Sec. 45.1  General.

    Except as specifically provided in this part, the provisions of the 
INA, as amended, and of parts 40 and 42 of this chapter shall apply to 
application for, consideration of, and issuance or refusal of, immigrant 
visas under section 124 of Public Law 101-649.



Sec. 45.2  Priority date of applicants.

    The priority date of an alien who is the beneficiary of a petition 
approved by the Service to accord status under section 124 of Public Law 
101-649 shall be the filing date of the approved petition, as determined 
by the Immigration and Naturalization Service. The priority date of the 
spouse or child, accompanying or following to join such an alien shall 
be the priority date of the alien spouse or parent.



Sec. 45.3  Control of numerical limitation.

    (a) Centralized control. Centralized control of the numerical 
limitation specified in section 124 of Public Law 101-649 is established 
in the Department. In order to effect this control, the Department shall 
limit the number of immigrant visas and the number of adjustments of 
status that may be granted to aliens applying under section 124 of 
Public Law 101-649 to a number not to exceed 12,000 in any fiscal year 
and not to exceed in any month of a fiscal year 1,200 plus any balance 
remaining from authorizations for preceding months in the same fiscal 
year.
    (b) Allocation of immigrant visa numbers. Within the numerical 
limitations specified in paragraph (a) of this section and based on the 
chronological order of priority dates of applicants as established 
pursuant to Sec. 45.2 of this part, the Department shall allocate 
immigrant visa numbers for use in connection with the issuance of 
immigrant visas and the granting of adjustment of status to such aliens.

[[Page 230]]



Sec. 45.4  Period of validity of immigrant visas.

    The period of validity of an immigrant visa issued to an alien 
pursuant to the provisions of this part may, at the request of the 
applicant, be extended until January 1, 2002, if the applicant so 
requests either at the time of issuance of the visa or within four 
months thereafter. If the applicant fails to make such a request at the 
time of visa issuance but subsequently, within four months thereafter, 
makes such a request, the consular officer shall issue a replacement 
visa to the alien in accordance with the provisions of Sec. 42.74(b) of 
part 42 of this title.



Sec. 45.5  Redetermination of admissibility if visa validity extended.

    (a) An alien to whom an immigrant visa is issued pursuant to this 
part who elects to have the validity of the visa extended as provided in 
Sec. 45.4 shall have his or her admissibility redetermined prior to 
actual travel to the United States as follows:
    (1) If the alien is the beneficiary of a petition to accord status 
under section 124 of Public Law 101-649 which was supported by a 
specific offer of employment from the petitioning entity, or is the 
spouse or child of such an alien, a redetermination of admissibility is 
required only if the anticipated date of actual application for 
admission for permanent residence is more than four months following the 
date of visa issuance;
    (2) If the alien is the beneficiary of a petition to accord status 
under section 124 of Public Law 101-649 which was supported by a general 
assurance from the petitioning entity that an appropriate job would be 
made available to the alien upon entry, or is the spouse or child of 
such an alien, a redetermination of admissibility is required whenever 
the alien proposes to apply for admission for permanent residence, 
whether within four months of the date of visa issuance or later.
    (b) When an alien to whom an immigrant visa is issued pursuant to 
this part elects to have the validity of the visa extended pursuant to 
paragraph (a) of this section, the consular officer shall notify the 
alien in writing of the requirement for a redetermination of 
admissibility as provided in paragraph (a) and shall endorse the visa 
``section 154 applies.'' Thereafter, the alien shall, not sooner than 
four months preceding the contemplated date of application for admission 
for permanent residence notify the appropriate consular officer of his 
or her intention to travel to the United States for this purpose. The 
consular officer shall thereupon schedule an appointment with such alien 
for the purpose of determining whether or not the alien remains 
admissible into the United States for permanent residence. If the 
consular officer determines that the alien continues to be so 
admissible, he or she shall issue to the alien a duplicate immigrant 
visa as provided in Sec. 45.6 of this part. If the consular officer 
determines that the alien has become inadmissible to the United States, 
he or she shall revoke the visa as provided in Sec. 42.82 of part 42 of 
this title.
    (c) An alien who elects to have the period of validity of his or her 
immigrant visa extended pursuant to Sec. 45.4 and whose entitlement to 
the immigrant classification of such visa was based upon his or her 
status as a child at the time of visa issuance shall not cease to be 
entitled to such visa by reason of attaining age twenty-one or marrying 
prior to his or her application for admission for permanent residence.
    (d) An alien who seeks a redetermination of admissibility pursuant 
to paragraph (a) of this section shall not be found to be admissible 
unless he or she:
    (1) Has continued to be employed by the petitioning entity in a 
qualifying position since issuance of the visa and presents a letter 
describing the specific qualifying employment the alien will take up 
upon admission for permanent residence; or
    (2) Is the spouse or child accompanying or following to join such an 
alien.
    (e) For the purposes of this section, ``qualifying position'' shall 
include both the position occupied by the alien at the time the petition 
in the alien's behalf was approved and any other position within the 
petitioning entity's organization, regardless of geographical location, 
which would otherwise meet the requirements for approval of such a 
petition in the alien's behalf.

[[Page 231]]

For the purposes of this section, qualifying employment shall mean any 
position in the United States of the kind required for approval of such 
a petition.
[56 FR 32506, July 17, 1991, as amended at 61 FR 1837, Jan. 24, 1996]



Sec. 45.6  Issuance of immigrant visa upon redetermination of admissibility.

    When an alien to whom an immigrant visa having extended validity has 
been issued pursuant to Sec. 45.5 of this part applies for a 
redetermination of admissibility and the consular officer determines 
that the alien remains admissible to the United States, the consular 
officer shall issue to the alien a new immigrant visa valid for a period 
of four months. The applicant shall execute a new application and 
provide the necessary current supporting documents. The applicant shall 
pay a new issuance fee. The consular officer shall insert the word 
``DUPLICATE'' on Form OF-155A before the word ``IMMIGRANT'' on each 
immigrant visa issued pursuant to this section.



PART 46--CONTROL OF ALIENS DEPARTING FROM THE UNITED STATES--Table of Contents




Sec.
46.1  Definitions.
46.2  Authority of departure-control officer to prevent alien's 
          departure from the United States.
46.3  Aliens whose departure is deemed prejudicial to the interests of 
          the United States.
46.4  Procedure in case of alien prevented from departing from the 
          United States.
46.5  Hearing procedure before special inquiry officer.
46.6  Departure from the Canal Zone, the Trust Territory of the Pacific 
          Islands, or outlying possessions of the United States.
46.7  Instructions from the Administrator required in certain cases.

    Authority:  Secs. 104, 215, 66 Stat. 174, 190; 8 U.S.C. 1104, 1185.



Sec. 46.1  Definitions.

    For the purposes of this part:
    (a) The term alien means any person who is not a citizen or national 
of the United States.
    (b) The term Commissioner means the Commissioner of Immigration and 
Naturalization.
    (c) The term regional commissioner means an officer of the 
Immigration and Naturalization Service duly appointed or designated as a 
regional commissioner, or an officer who has been designated to act as a 
regional commissioner.
    (d) The term district director means an officer of the Immigration 
and Naturalization Service duly appointed or designated as a district 
director, or an officer who has been designated to act as a district 
director.
    (e) The term United States means the several States, the District of 
Columbia, the Canal Zone, Puerto Rico, the Virgin Islands, Guam, 
American Samoa, Swains Island, the Trust Territory of the Pacific 
Islands, and all other territory and waters, continental and insular, 
subject to the jurisdiction of the United States.
    (f) The term continental United States means the District of 
Columbia and the several States, except Alaska and Hawaii.
    (g) The term geographical part of the United States means (1) the 
continental United States, (2) Alaska, (3) Hawaii, (4) Puerto Rico, (5) 
the Virgin Islands, (6) Guam, (7) the Canal Zone, (8) American Samoa, 
(9) Swains Island, or (10) the Trust Territory of the Pacific Islands.
    (h) The term depart from the United States means depart by land, 
water, or air (1) from the United States for any foreign place, or (2) 
from one geographical part of the United States for a separate 
geographical part of the United States: Provided, That a trip or journey 
upon a public ferry, passenger vessel sailing coastwise on a fixed 
schedule, excursion vessel, or aircraft, having both termini in the 
continental United States or in any one of the other geographical parts 
of the United States and not touching any territory or waters under the 
jurisdiction or control of a foreign power, shall not be deemed a 
departure from the United States.
    (i) The term departure-control officer means any immigration officer 
as defined in the regulations of the Immigration and Naturalization 
Service who

[[Page 232]]

is designated to supervise the departure of aliens, or any officer or 
employee of the United States designated by the Governor of the Canal 
Zone, the High Commissioner of the Trust Territory of the Pacific 
Islands, or the governor of an outlying possession of the United States, 
to supervise the departure of aliens.
    (j) The term port of departure means a port in the continental 
United States, Alaska, Guam, Hawaii, Puerto Rico or the Virgin Islands, 
designated as a port of entry by the Attorney General or by the 
Commissioner, or in exceptional circumstances such other place as the 
departure-control officer may, in his discretion, designate in an 
individual case, or a port in American Samoa, Swains Island, the Canal 
Zone, or the Trust Territory of the Pacific Islands, designated as a 
port of entry by the chief executive officer thereof.
    (k) The term special inquiry officer shall have the meaning ascribed 
thereto in section 101(b)(4) of the Immigration and Nationality Act.
[22 FR 10827, Dec. 27, 1957, as amended at 25 FR 7022, July 23, 1960]



Sec. 46.2  Authority of departure-control officer to prevent alien's departure from the United States.

    (a) No alien shall depart, or attempt to depart, from the United 
States if his departure would be prejudicial to the interests of the 
United States under the provisions of Sec. 46.3. Any departure-control 
officer who knows or has reason to believe that the case of an alien in 
the United States comes within the provisions of Sec. 46.3 shall 
temporarily prevent the departure of such alien from the United States 
and shall serve him with a written temporary order directing him not to 
depart, or attempt to depart, from the United States until notified of 
the revocation of the order.
    (b) The written order temporarily preventing an alien, other than an 
enemy alien, from departing from the United States shall become final 15 
days after the date of service thereof upon the alien, unless prior 
thereto the alien requests a hearing as hereinafter provided. At such 
time as the alien is served with an order temporarily preventing his 
departure from the United States, he shall be notified in writing 
concerning the provisions of this paragraph, and shall be advised of his 
right to request a hearing if entitled thereto under Sec. 46.4. In the 
case of an enemy alien, the written order preventing departure shall 
become final on the date of its service upon the alien.
    (c) Any alien who seeks to depart from the United States may be 
required, in the discretion of the departure-control officer, to be 
examined under oath and to submit for official inspection all documents, 
articles, and other property in his possession which are being removed 
from the United States upon, or in connection with, the alien's 
departure. The departure-control officer may permit such other persons, 
including officials of the Department of State and interpreters, to 
participate in such examination or inspection and may exclude from 
presence at such examination or inspection any person whose presence 
would not further the objectives of such examination or inspection. The 
departure-control officer shall temporarily prevent the departure of any 
alien who refuses to submit to such examination or inspection, and may, 
if necessary to cause the alien to submit to such examination or 
inspection, take possession of the alien's passport or other travel 
document or issue a subpoena requiring the alien to submit to such 
examination or inspection.
[22 FR 10827, Dec. 27, 1957, as amended at 45 FR 64174, Sept. 29, 1980]



Sec. 46.3  Aliens whose departure is deemed prejudicial to the interests of the United States.

    The departure from the United States of any alien within one or more 
of the following categories shall be deemed prejudicial to the interest 
of the United States:
    (a) Any alien who is in possession of, and who is believed likely to 
disclose to unauthorized persons, information concerning the plans, 
preparations, equipment, or establishments for the national defense and 
security of the United States.
    (b) Any alien who seeks to depart from the United States to engage 
in, or who is likely to engage in, activities of any kind designed to 
obstruct, impede,

[[Page 233]]

retard, delay or counteract the effectiveness of the national defense of 
the United States or the measures adopted by the United States or the 
United Nations for the defense of any other country.
    (c) Any alien who seeks to depart from the United States to engage 
in, or who is likely to engage in, activities which would obstruct, 
impede, retard, delay, or counteract the effectiveness of any plans made 
or action taken by any country cooperating with the United States in 
measures adopted to promote the peace, defense, or safety of the United 
States or such other country.
    (d) Any alien who seeks to depart from the United States for the 
purpose of organizing, directing, or participating in any rebellion, 
insurrection, or violent uprising in or against the United States or a 
country allied with the United States, or of waging war against the 
United States or its allies, or of destroying, or depriving the United 
States of sources of supplies or materials vital to the national defense 
of the United States, or to the effectiveness of the measures adopted by 
the United States for its defense, or for the defense of any other 
country allied with the United States.
    (e) Any alien who is subject to registration for training and 
service in the Armed Forces of the United States and who fails to 
present a Registration Certificate (SSS Form No. 2) showing that he has 
complied with his obligation to register under the Universal Military 
Training and Service Act, as amended.
    (f) Any alien who is a fugitive from justice on account of an 
offense punishable in the United States.
    (g) Any alien who is needed in the United States as a witness in, or 
as a party to, any criminal case under investigation or pending in a 
court in the United States: Provided, That any alien who is a witness 
in, or a party to, any criminal case pending in any criminal court 
proceeding may be permitted to depart from the United States with the 
consent of the appropriate prosecuting authority, unless such alien is 
otherwise prohibited from departing under the provisions of this part.
    (h) Any alien who is needed in the United States in connection with 
any investigation or proceeding being, or soon to be, conducted by any 
official executive, legislative, or judicial agency in the United States 
or by any governmental committee, board, bureau, commission, or body in 
the United States, whether national, state, or local.
    (i) Any alien whose technical or scientific training and knowledge 
might be utilized by an enemy or a potential enemy of the United States 
to undermine and defeat the military and defensive operations of the 
United States or of any nation cooperating with the United States in the 
interests of collective security.
    (j) Any alien, where doubt exists whether such alien is departing or 
seeking to depart from the United States voluntarily except an alien who 
is departing or seeking to depart subject to an order issued in 
extradition, exclusion, or deportation proceedings.
    (k) Any alien whose case does not fall within any of the categories 
described in paragraphs (a) to (j), inclusive, of this section, but 
which involves circumstances of a similar character rendering the 
alien's departure prejudicial to the interests of the United States.

(Sec. 215, Immigration and Nationality Act, 66 Stat. 190, 8 U.S.C. 1185; 
Proc. No. 3004 of January 17, 1953)
[22 FR 10828, Dec. 27, 1957, as amended at 42 FR 19479, Apr. 14, 1977; 
45 FR 64174, Sept. 29, 1980]



Sec. 46.4  Procedure in case of alien prevented from departing from the United States.

    (a) Any alien, other than an enemy alien, whose departure has been 
temporarily prevented under the provisions of Sec. 46.2 may, within 15 
days of the service upon him of the written order temporarily preventing 
his departure, request a hearing before a special inquiry officer. The 
alien's request for a hearing shall be made in writing and shall be 
addressed to the district director having administrative jurisdiction 
over the alien's place of residence. If the alien's request for a 
hearing is timely made, the district director shall schedule a hearing 
before a special inquiry officer, and notice of such hearing shall be 
given to the alien. The notice of

[[Page 234]]

hearing shall, as specifically as security considerations permit, inform 
the alien of the nature of the case against him, shall fix the time and 
place of the hearing, and shall inform the alien of his right to be 
represented, at no expense to the Government, by counsel of his own 
choosing.
    (b) Every alien for whom a hearing has been scheduled under 
paragraph (a) of this section shall be entitled (1) to appear in person 
before the special inquiry officer, (2) to be represented by counsel of 
his own choice, (3) to have the opportunity to be heard and to present 
evidence, (4) to cross-examine the witnesses who appear at the hearing, 
except that if, in the course of the examination, it appears that 
further examination may divulge information of a confidential or 
security nature, the special inquiry officer may, in his discretion, 
preclude further examination of the witness with respect to such 
matters, (5) to examine any evidence in possession of the Government 
which is to be considered in the disposition of the case, provided that 
such evidence is not of a confidential or security nature the disclosure 
of which would be prejudicial to the interests of the United States, (6) 
to have the time and opportunity to produce evidence and witnesses on 
his own behalf, and (7) to reasonable continuances upon request, for 
good cause shown.
    (c) Any special inquiry officer who is assigned to conduct the 
hearing provided for in this section shall have the authority to: (1) 
Administer oaths and affirmations, (2) present and receive evidence, (3) 
interrogate, examine, and cross-examine under oath or affirmation both 
the alien and witnesses, (4) rule upon all objections to the 
introduction of evidence or motions made during the course of the 
hearing, (5) take or cause depositions to be taken, (6) issue subpoenas, 
and (7) take any further action consistent with applicable provisions of 
law, executive orders, proclamations, and regulations.
[22 FR 10828, Dec. 27, 1957, as amended at 27 FR 1358, Feb. 14, 1962]



Sec. 46.5  Hearing procedure before special inquiry officer.

    (a) The hearing before the special inquiry officer shall be 
conducted in accordance with the following procedure:
    (1) The special inquiry officer shall advise the alien of the rights 
and privileges accorded him under the provisions of Sec. 46.4.
    (2) The special inquiry officer shall enter of record (i) a copy of 
the order served upon the alien temporarily preventing his departure 
from the United States, and (ii) a copy of the notice of hearing 
furnished the alien.
    (3) The alien shall be interrogated by the special inquiry officer 
as to the matters considered pertinent to the proceeding, with 
opportunity reserved to the alien to testify thereafter in his own 
behalf, if he so chooses.
    (4) The special inquiry officer shall present on behalf of the 
Government such evidence, including the testimony of witnesses and the 
certificates or written statements of Government officials or other 
persons, as may be necessary and available. In the event such 
certificates or statements are recieved in evidence, the alien may 
request and, in the discretion of the special inquiry officer, be given 
an opportunity to interrogate such officials or persons, by deposition 
or otherwise, at a time and place and in a manner fixed by the special 
inquiry officer: Provided, That when in the judgment of the special 
inquiry officer any evidence relative to the disposition of the case is 
of a confidential or security nature the disclosure of which would be 
prejudicial to the interests of the United States, such evidence shall 
not be presented at the hearing but shall be taken into consideration in 
arriving at a decision in the case.
    (5) The alien may present such additional evidence, including the 
testimony of witnesses, as is pertinent and available.
    (b) A complete verbatim transcript of the hearing, except statements 
made off the record, shall be recorded. The alien shall be entitled, 
upon request, to the loan of a copy of the transcript, without cost, 
subject to reasonable conditions governing its use.

[[Page 235]]

    (c) Following the completion of the hearing, the special inquiry 
officer shall make and render a recommended decision in the case, which 
shall be governed by and based upon the evidence presented at the 
hearing and any evidence of a confidential or security nature which the 
Government may have in its possession. The decision of the special 
inquiry officer shall recommend (1) that the temporary order preventing 
the departure of the alien from the United States be made final, or (2) 
that the temporary order preventing the departure of the alien from the 
United States be revoked. This recommended decision of the special 
inquiry officer shall be made in writing and shall set forth the 
officer's reasons for such decision. The alien concerned shall at his 
request be furnished a copy of the recommended decision of the special 
inquiry officer, and shall be allowed a reasonable time, not to exceed 
10 days, in which to submit representations with respect thereto in 
writing.
    (d) As soon as practicable after the completion of the hearing and 
the rendering of a decision by the special inquiry officer, the district 
director shall forward the entire record of the case, including the 
recommended decision of the special inquiry officer and any written 
representations submitted by the alien, to the regional commissioner 
having jurisdiction over his district. After reviewing the record, the 
regional commissioner shall render a decision in the case, which shall 
be based upon the evidence in the record and on any evidence or 
information of a confidential or security nature which he deems 
pertinent. Whenever any decision is based in whole or in part on 
confidential or security information not included in the record, the 
decision shall state that such information was considered. A copy of the 
regional commissioner's decision shall be furnished the alien, or his 
attorney or representative. No administrative appeal shall lie from the 
regional commissioner's decision.
    (e) Notwithstanding any other provision of this part, the 
Administrator of the Bureau of Security and Consular Affairs referred to 
in section 104(b) of the Immigration and Nationality Act, or such other 
officers of the Department of State as he may designate, after 
consultation with the Commissioner, or such other officers of the 
Immigration and Naturalization Service as he may designate, may at any 
time permit the departure of an individual alien or of a group of aliens 
from the United States if he determines that such action would be in the 
national interest. If the Administrator specifically requests the 
Commissioner to prevent the departure of a particular alien or of a 
group of aliens, the Commissioner shall not permit the departure of such 
alien or aliens until he has consulted with the Administrator.
    (f) In any case arising under Secs. 46.1 to 46.7, the Administrator 
shall, at his request, be kept advised, in as much detail as he may 
indicate is necessary, of the facts and of any action taken or proposed.
[22 FR 10828, Dec. 27, 1957, as amended at 26 FR 3069, Apr. 11, 1961; 27 
FR 1358, Feb. 14, 1962]



Sec. 46.6  Departure from the Canal Zone, the Trust Territory of the Pacific Islands, or outlying possessions of the United States.

    (a) In addition to the restrictions and prohibitions imposed by the 
provisions of this part upon the departure of aliens from the United 
States, any alien who seeks to depart from the Canal Zone, the Trust 
Territory of the Pacific Islands, or an outlying possession of the 
United States shall comply with such other restrictions and prohibitions 
as may be imposed by regulations prescribed, with the concurrence of the 
Administrator of the Bureau of Security and Consular Affairs and the 
Commissioner, by the Governor of the Canal Zone, the High Commissioner 
of the Trust Territory of the Pacific Islands, or by the governor of an 
outlying possession of the United States, respectively. No alien shall 
be prevented from departing from such zone, territory, or possession 
without first being accorded a hearing as provided in Secs. 46.4 and 
46.5.
    (b) The Governor of the Canal Zone, the High Commissioner of the 
Trust Territory of the Pacific Islands, or the governor of any outlying 
possession of the United States shall have the authority to designate 
any employee or

[[Page 236]]

class of employees of the United States as hearing officers for the 
purpose of conducting the hearing referred to in paragraph (a) of this 
section. The hearing officer so designated shall exercise the same 
powers, duties, and functions as are conferred upon special inquiry 
officers under the provisions of this part. The chief executive officer 
of such zone, territory, or possession shall, in lieu of the regional 
commissioner, review the recommended decision of the hearing officer, 
and shall render a decision in any case referred to him, basing it on 
evidence in the record and on any evidence or information of a 
confidential or a security nature which he deems pertinent.
[22 FR 10829, Dec. 27, 1957, as amended at 26 FR 3069, Apr. 11, 1961]



Sec. 46.7  Instructions from the Administrator required in certain cases.

    In the absence of appropriate instructions from the Administrator of 
the Bureau of Security and Consular Affairs, departure-control officers 
shall not exercise the authority conferred by Sec. 46.2 in the case of 
any alien who seeks to depart from the United States in the status of a 
nonimmigrant under section 101(a)(15) (A) or (G) of the Immigration and 
Nationality Act, or in the status of a nonimmigrant under section 11(3), 
11 (4), or 11(5) of the Agreement between the United Nations and the 
United States of America regarding the Headquarters of the United 
Nations (61 Stat. 756): Provided, That in cases of extreme urgency, 
where the national security so requires, a departure-control officer may 
preliminarily exercise the authority conferred by Sec. 46.2 pending the 
outcome of consultation with the Administrator, which shall be 
undertaken immediately. In all cases arising under this section, the 
decision of the Administrator shall be controlling: Provided, That any 
decision to prevent the departure of an alien shall be based upon a 
hearing and record as prescribed in this part.
[26 FR 3069, Apr. 11, 1961; 26 FR 3188, Apr. 14, 1961]



PART 47--(RESERVED)




[[Page 237]]



                 SUBCHAPTER F--NATIONALITY AND PASSPORTS





PART 50--NATIONALITY PROCEDURES--Table of Contents




Sec.
50.1  Definitions.

Subpart A--Procedures for Determination of United States Nationality of 
                             a Person Abroad

50.2  Determination of U.S. nationality of persons abroad.
50.3  Application for registration.
50.4  Application for passport.
50.5  Application for registration of birth abroad.
50.6  Registration at the Department of birth abroad.
50.7  Consular Report of Birth Abroad of a Citizen of the United States 
          of America.
50.8  Certification of Report of Birth Abroad of a United States 
          Citizen.
50.9  Card of identity.
50.10  Certificate of nationality.
50.11  Certificate of identity for travel to the United States to apply 
          for admission.

           Subpart B--Retention and Resumption of Nationality

50.20  Retention of nationality.
50.30  Resumption of nationality.

                     Subpart C--Loss of Nationality

50.40  Certification of loss of U.S. nationality.
50.50  Renunciation of nationality.
50.51  Notice of right to appeal

    Authority:  Sec. 4, 63 Stat. 111, as amended, secs. 104s, 360, 66 
Stat. 174, 273; 22 U.S.C. 211a, 22 U.S.C. 2658, 2705, 8 U.S.C. 1104, 
1503.

    Source:  31 FR 13537, Oct. 20, 1966, unless otherwise noted.



Sec. 50.1  Definitions.

    The following definitions shall be applicable to this part:
    (a) United States means the continental United States, the State of 
Hawaii, the Commonwealth of Puerto Rico, the Virgin Islands of the 
United States, the Canal Zone, American Samoa, Guam and any other 
islands or territory over which the United States exercises 
jurisdiction.
    (b) Department means the Department of State of the United States of 
America.
    (c) Secretary means the Secretary of State.
    (d) National means a citizen of the United States or a noncitizen 
owing permanent allegiance to the United States.
    (e) Passport means a travel document issued under the authority of 
the Secretary of State attesting to the identity and nationality of the 
bearer.
    (f) Passport Agent means a person designated by the Department to 
accept passport applications.
    (g) Designated nationality examiner means a United States citizen 
employee of the Department of State assigned or employed abroad 
(permanently or temporarily) and designated by the Deputy Assistant 
Secretary of State for Overseas Citizen Services, to grant, issue and 
verify U.S. passports. A designated nationality examiner may adjudicate 
claims of acquisition and loss of United States nationality and 
citizenship as required for the purpose of providing passport and 
related services. The authority of designated nationality examiners 
shall include the authority to examine, adjudicate, approve and deny 
passport applications and applications for related services. The 
authority of designated nationality examiners shall expire upon 
termination of the employee's assignment for such duty and may also be 
terminated at any time by the Deputy Assistant Secretary for Overseas 
Citizen Services.
[31 FR 13537, Oct. 20, 1966, as amended at 31 FR 14521, Nov. 11, 1966; 
61 FR 43311, Aug. 22, 1996]



Subpart A--Procedures for Determination of United States Nationality of 
                             a Person Abroad



Sec. 50.2  Determination of U.S. nationality of persons abroad.

    The Department shall determine claims to United States nationality 
when made by persons abroad on the basis of an application for 
registration, for a passport, or for a Consular Report of Birth Abroad 
of a Citizen of the

[[Page 238]]

United States of America. Such determinations of nationality may be made 
abroad by a consular officer or a designated nationality examiner. A 
designated nationality examiner may accept and approve/disapprove 
applications for registration and accept and approve/disapprove 
applications for passports and issue passports. Under the supervision of 
a consular officer, designated nationality examiners shall accept, 
adjudicate, disapprove and provisionally approve applications for the 
Consular Report of Birth Abroad. A Consular Report of Birth Abroad may 
only be issued by a consular officer, who will review a designated 
nationality examiner's provisional approval of an application for such 
report and issue the report if satisfied that the claim to nationality 
has been established.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 43311, Aug. 22, 1996]



Sec. 50.3  Application for registration.

    (a) A person abroad who claims U.S. nationality, or a representative 
on his behalf, may apply at a consular post for registration to 
establish his claim to U.S. nationality or to make his residence in the 
particular consular area a matter of record.
    (b) The applicant shall execute the registration form prescribed by 
the Department and shall submit the supporting evidence required by 
subpart C of part 51 of this chapter. A diplomatic or consular officer 
or a designated nationality examiner shall determine the period of time 
for which the registration will be valid.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 43312, Aug. 22, 1996]



Sec. 50.4  Application for passport.

    A claim to U.S. nationality in connection with an application for 
passport shall be determined by posts abroad in accordance with the 
regulations contained in part 51 of this chapter.



Sec. 50.5  Application for registration of birth abroad.

    Upon application by the parent(s) or the child's legal guardian, a 
consular officer or designated nationality examiner may accept and 
adjudicate the application for a Consular Report of Birth Abroad of a 
Citizen of the United States of America for a child born in their 
consular district. In specific instances, the Department may authorize 
consular officers and other designated employees to adjudicate the 
application for a Consular Report of Birth Abroad of a child born 
outside his/her consular district. Under the supervision of a consular 
officer, designated nationality examiners shall accept, adjudicate, 
disapprove and provisionally approve applications for the Consular 
Report of Birth Abroad. The applicant shall be required to submit proof 
of the child's birth, identity and citizenship meeting the evidence 
requirements of subpart C of part 51 of this subchapter and shall 
include:
    (a) Proof of child's birth. Proof of child's birth usually consists 
of, but is not limited to, an authentic copy of the record of the birth 
filed with local authorities, a baptismal certificate, a military 
hospital certificate of birth, or an affidavit of the doctor or the 
person attending the birth. If no proof of birth is available, the 
person seeking to register the birth shall submit his affidavit 
explaining why such proof is not available and setting forth the facts 
relating to the birth.
    (b) Proof of child's citizenship. Evidence of parent's citizenship 
and, if pertinent, evidence of parent's physical presence in the United 
States as required for transmittal of claim of citizenship by the 
Immigration and Nationality Act of 1952 shall be submitted.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 43312, Aug. 22, 1996]



Sec. 50.6  Registration at the Department of birth abroad.

    In the time of war or national emergency, passport agents may be 
designated to complete consular reports of birth for children born at 
military facilities which are not under the jurisdiction of a consular 
office. An officer of the Armed Forces having authority to administer 
oaths may take applications for registration under this section.

[[Page 239]]



Sec. 50.7  Consular Report of Birth Abroad of a Citizen of the United States of America.

    (a) Upon application and the submission of satisfactory proof of 
birth, identity and nationality, and at the time of the reporting of the 
birth, the consular officer may issue to the parent or legal guardian, 
when approved and upon payment of a prescribed fee, a Consular Report of 
Birth Abroad of a Citizen of the United States of America.
    (b) Amended and replacement Consular Reports of Birth Abroad of a 
Citizen of the United States of America may be issued by the Department 
of State's Passport Office upon written request and payment of the 
required fee.
    (c) When it reports a birth under Sec. 50.6, the Department shall 
furnish the Consular Report of Birth Abroad of a Citizen of the United 
States of America to the parent or legal guardian upon application and 
payment of required fees.
[61 FR 43312, Aug. 22, 1996]



Sec. 50.8  Certification of Report of Birth Abroad of a United States Citizen.

    At any time subsequent to the issuance of a Consular Report of Birth 
Abroad of a Citizen of the United States of America, when requested and 
upon payment of the required fee, the Department of State's Passport 
Office may issue to the citizen, the citizen's parent or legal guardian 
a certificate entitled ``Certification of Report of Birth Abroad of a 
United States Citizen.''
[61 FR 43312, Aug. 22, 1996]



Sec. 50.9  Card of identity.

    When authorized by the Department, consular offices or designated 
nationality examiners may issue a card of identity for travel to the 
United States to nationals of the United States being deported from a 
foreign country, to nationals/citizens of the United States involved in 
a common disaster abroad, or to a returning national of the United 
States to whom passport services have been denied or withdrawn under the 
provisions of this part or parts 51 or 53 of this subchapter.
[61 FR 43312, Aug. 22, 1996]



Sec. 50.10  Certificate of nationality.

    (a) Any person who acquired the nationality of the United States at 
birth and who is involved in any judicial or administrative proceedings 
in a foreign state and needs to establish his U.S. nationality may apply 
for a certificate of nationality in the form prescribed by the 
Department.
    (b) An applicant for a certificate of nationality must submit 
evidence of his nationality and documentary evidence establishing that 
he is involved in judicial or administrative proceedings in which proof 
of his U.S. nationality is required.



Sec. 50.11  Certificate of identity for travel to the United States to apply for admission.

    (a) A person applying abroad for a certificate of identity under 
section 360(b) of the Immigration and Nationality Act shall complete the 
application form prescribed by the Department and submit evidence to 
support his claim to U.S. nationality.
    (b) When a diplomatic or consular officer denies an application for 
a certificate of identity under this section, the applicant may submit a 
written appeal to the Secretary, stating the pertinent facts, the 
grounds upon which U.S. nationality is claimed and his reasons for 
considering that the denial was not justified.
[31 FR 14521, Nov. 11, 1966]



           Subpart B--Retention and Resumption of Nationality



Sec. 50.20  Retention of nationality.

    (a) Section 351(b) of the Immigration and Nationality Act. (1) A 
person who desires to claim U.S. nationality under the provisions of 
section 351(b) of the Immigration and Nationality Act must, within the 
time period specified in the statute, assert a claim to U.S. nationality 
and subscribe to an oath of allegiance before a diplomatic or consular 
officer.
    (2) In addition, the person shall submit to the Department a 
statement reciting the person's identity and acquisition or derivation 
of U.S. nationality, the facts pertaining to the performance of any act 
which would otherwise have

[[Page 240]]

been expatriative, and his desire to retain his U.S. nationality.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 29652, 29653, June 12, 
1996]



Sec. 50.30  Resumption of nationality.

    (a) Section 324(c) of the Immigration and Nationality Act. (1) A 
woman formerly a citizen of the United States at birth who wishes to 
regain her citizenship under section 324(c) of the Immigration and 
Nationality Act may apply abroad to a diplomatic or consular officer on 
the form prescribed by the Department to take the oath of allegiance 
prescribed by section 337 of that Act.
    (2) The applicant shall submit documentary evidence to establish her 
eligibility to take the oath of allegiance. If the diplomatic or 
consular officer or the Department determines, when the application is 
submitted to the Department for decision, that the applicant is 
ineligible for resumption of citizenship because of section 313 of the 
Immigration and Nationality Act, the oath shall not be administered.
    (b) The Act of June 25, 1936. (1) A woman who has been restored to 
citizenship by the Act of June 25, 1936, as amended by the Act of July 
2, 1940, but who failed to take the oath of allegiance prior to December 
24, 1952, as prescribed by the nationality laws, may apply abroad to any 
diplomatic or consular officer to take the oath of allegiance as 
prescribed by section 337 of the Immigration and Nationality Act.
    (2) The applicant shall submit documentary evidence to establish her 
eligibility to take the oath of allegiance. If the diplomatic or 
consular officer or the Department determines, when the application is 
submitted to the Department, that the applicant is ineligible for 
resumption of citizenship under section 313 of the Immigration and 
Nationality Act, the oath shall not be administered.
    (c) Certification of repatriation. Upon request and payment of the 
prescribed fee, a diplomatic or consular officer or the Department shall 
issue a certified copy of the application and oath administered to a 
woman repatriated under this section.
    (d) Section 324(d)(1) of the Immigration and Nationality Act. (1) A 
former citizen of the United States who did not retain U.S. citizenship 
by failure to fulfill residency requirements as set out in Section 
201(g) of the 1940 Nationality Act or former 301(b) of the 1952 
Immigration and Nationality Act, may regain his/her U.S. citizenship 
pursuant to Section 324(d) INA, by applying abroad at a diplomatic or 
consular post, or in the U.S. at any Immigration and Naturalization 
Service office in the form and manner prescribed by the Department of 
State and the Immigration and Naturalization Service (INS).
    (2) The applicant shall submit documentary evidence to establish 
eligibility to take the oath of allegiance, which includes proof of 
birth abroad to a U.S. citizen parent between May 24, 1934 and December 
24, 1952. If the diplomatic, consular, INS, or passport officer 
determines that the applicant is ineligible to regain citizenship under 
section 313 INA, the oath shall not be administered.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 29653, June 12, 1996]



                     Subpart C--Loss of Nationality



Sec. 50.40  Certification of loss of U.S. nationality.

    (a) Administrative presumption. In adjudicating potentially 
expatriating acts pursuant to INA 349(a), the Department has adopted an 
administrative presumption regarding certain acts and the intent to 
commit them. U.S. evidence of intent to retain U.S. nationality. In 
these three classes of cases, intent to retain U.S. citizenship will be 
presumed. A person who affirmatively asserts to a consular officer, 
after he or she has committed a potentially expatriating act, that it 
was his or her intent to relinquish U.S. citizenship will lose his or 
her U.S. citizenship. In other loss of nationality cases, the consular 
officer will ascertain whether or not there is evidence of intent to 
relinquish U.S. nationality.
    (b) Whenever a person admits that he or she had the intent to 
relinquish citizenship by the voluntary and intentional performance of 
one of the acts specified in Section 349(a) of the Immigration and 
Nationality Act, and the person consents to the execution of an 
affidavit to that effect, the diplomatic

[[Page 241]]

or consular officer shall attach such affidavit to the certificate of 
loss of nationality.
    (c) Whenever a diplomatic or consular officer has reason to believe 
that a person, while in a foreign country, has lost his U.S. nationality 
under any provision of chapter 3 of title III of the Immigration and 
Nationality Act of 1952, or under any provision of chapter IV of the 
Nationality Act of 1940, as amended, he shall prepare a certificate of 
loss of nationality containing the facts upon which such belief is based 
and shall forward the certificate to the Department.
    (d) If the diplomatic or consular officer determines that any 
document containing information relevant to the statements in the 
certificate of loss of nationality should not be attached to the 
certificate, the person may summarize the pertinent information in the 
appropriate section of the certificate and send the documents together 
with the certificate to the Department.
    (e) If the certificate of loss of nationality is approved by the 
Department, a copy shall be forwarded to the Immigration and 
Naturalization Service, Department of Justice. The diplomatic or 
consular office in which the certificate was prepared shall then forward 
a copy of the certificate to the person to whom it relates or his 
representative.
[31 FR 13537, Oct. 20, 1996. Redesignated and amended at 61 FR 29652, 
June 12, 1996]



Sec. 50.50  Renunciation of nationality.

    (a) A person desiring to renounce U.S. nationality under section 
349(a)(5) of the Immigration and Nationality Act shall appear before a 
diplomatic or consular officer of the United States in the manner and 
form prescribed by the Department. The renunciant must include on the 
form he signs a statement that he absolutely and entirely renounces his 
U.S. nationality together with all rights and privileges and all duties 
of allegiance and fidelity thereunto pertaining.
    (b) The diplomatic or consular officer shall forward to the 
Department for approval the oath of renunciation together with a 
certificate of loss of nationality as provided by section 358 of the 
Immigration and Nationality Act. If the officer's report is approved by 
the Department, copies of the certificate shall be forwarded to the 
Immigration and Naturalization Service, Department of Justice, and to 
the person to whom it relates or his representative.
[31 FR 13537, Oct. 20, 1966, as amended at 61 FR 29653, June 12, 1996]



Sec. 50.51  Notice of right to appeal.

    When an approved certificate of loss of nationality or certificate 
of expatriation is forwarded to the person to whom it relates or his or 
her representative, such person or representative shall be informed of 
the right to appeal the Department's determination to the Board of 
Appellate Review (part 7 of this chapter) within one year after approval 
of the certificate of loss of nationality or the certificate of 
expatriation.
[44 FR 68827, Nov. 30, 1979. Redesignated at 61 FR 29653, June 12, 1996]



PART 51--PASSPORTS--Table of Contents




Sec.
51.1  Definitions.

                           Subpart A--General

51.2  Passport issued to nationals only.
51.3  Types of passports.
51.4  Validity of passports.
51.5  [Reserved]
51.6  Mutilation and alteration of passports.
51.7  Verification of passports.
51.8  Cancellation of previously issued passport.
51.9  Passport property of the U.S. Government.

                         Subpart B--Application

51.20  General.
51.21  Execution of passport application.
51.22  [Reserved]
51.23  Name of applicant to be used in passport.
51.24  Change of name.
51.25  Photographs.
51.26  Incompetents.
51.27  Minors.
51.28  Identity of applicant.
51.30  Persons unacceptable as witnesses.
51.31  Affidavit of identifying witness.
51.32  Amendment of passports.
51.33  Release of passport information.

[[Page 242]]

     Subpart C--Evidence of United States Citizenship or Nationality

51.40  Burden of proof.
51.41  Documentary evidence.
51.43  Persons born in the United States applying for a passport for the 
          first time.
51.44  Persons born abroad applying for a passport for the first time.

                              Married Women

51.45  Marriage to an alien prior to March 2, 1907.
51.46  Marriage to an alien between March 2, 1907, and September 22, 
          1922.
51.47  Marriage prior to September 22, 1922, to an alien who acquired 
          U.S. citizenship by naturalization prior to September 22, 
          1922.
51.48  Marriage between September 22, 1922, and March 3, 1931, to an 
          alien ineligible to citizenship.
51.49  Marriage on or after September 22, 1922, to an alien eligible to 
          naturalization.
51.50  Alien born woman--marriage to citizen prior to September 22, 
          1922.

                Citizenship by Act of Congress or Treaty

51.51  Former nationals of Spain or Denmark.
51.52  Citizenship by birth in territory under sovereignty of the United 
          States.
51.53  Proof of resumption of U.S. citizenship.
51.54  Requirement of additional evidence of U.S. citizenship.
51.55  Return or retention of evidence of citizenship.

                             Subpart D--Fees

51.60  Form of remittance.
51.61  Passport fees.
51.62  Exemption from payment of passport or execution fee.
51.63  Refunds.
51.64  Replacement passports.
51.65  Execution fee not refundable.
51.66  Expedited passport processing.

       Subpart E--Limitation on Issuance or Extension of Passports

51.70  Denial of passports.
51.71  Denial of passports to certain convicted drug traffickers.
51.72  Revocation or restriction of passports.
51.73  Passports invalid for travel into or through restricted areas.
51.74  Special validation of passports for travel to restricted areas.
51.75  Notification of denial or withdrawal of passport.
51.76  Surrender of passport.

           Subpart F--Procedures for Review of Adverse Action

51.80  Applicability of Secs. 51.81 through 51.89.
51.81  Time limits on hearing to review adverse action.
51.82  Notice of hearing.
51.83  Functions of the hearing officer.
51.84  Appearance at hearing.
51.85  Proceedings before the hearing officer.
51.86  Admissibility of evidence.
51.87  Privacy of hearing.
51.88  Transcript of hearing.
51.89  Decision of Assistant Secretary for Consular Affairs; notice of 
          right to appeal.

    Authority:  22 U.S.C. 211a, 212, 213, 214, 214a, 216, 217a, 2671(d); 
31 U.S.C. 9701; Sec. 129, Pub. L. 102-138, 105 Stat. 661; E.O. 11295, 36 
FR 10603, 3 CFR, 1966-1970 Comp., p. 570.

    Source:  31 FR 13540, Oct. 20, 1966, unless otherwise noted.



Sec. 51.1  Definitions.

    The following definitions shall be applicable to this part:
    (a) United States means the continental United States, the State of 
Hawaii, the Commonwealth of Puerto Rico, the Virgin Islands of the 
United States, the Canal Zone, American Samoa, Guam and any other 
islands or territory over which the United States exercises 
jurisdiction.
    (b) Department means the Department of State of the United States of 
America.
    (c) Secretary means the Secretary of State.
    (d) National means a citizen of the United States or a noncitizen 
owing permanent allegiance to the United States.
    (e) Passport means a travel document issued under the authority of 
the Secretary of State attesting to the identity and nationality of the 
bearer.
    (f) Passport Agent means a person designated by the Department to 
accept passport applications.
    (g) Passport Issuing Office means the Passport Office, a Passport 
Agency, a Passport Agent of the Department, or a Foreign Service Post 
authorized to issue passports.
    (h) Designated nationality examiner means a person designated under 
Sec. 50.1(g) of this subchapter.
[31 FR 13540, Oct. 20, 1966, as amended at 31 FR 14522, Nov. 11, 1966; 
61 FR 43312, Aug. 22, 1996]

[[Page 243]]



                           Subpart A--General



Sec. 51.2  Passport issued to nationals only.

    (a) A United States passport shall be issued only to a national of 
the United States (22 U.S.C. 212).
    (b) Unless authorized by the Department no person shall bear more 
than one valid or potentially valid U.S. passport at any one time.
[SD-165, 46 FR 2343, Jan. 9, 1981]



Sec. 51.3  Types of passports.

    (a) Regular passport. A regular passport is issued to a national of 
the United States proceeding abroad for personal or business reasons.
    (b) Official passport. An official passport is issued to an official 
or employee of the U.S. Government proceeding abroad in the discharge of 
official duties. Where appropriate, dependents of such persons may be 
issued official passports.
    (c) Diplomatic passport. A diplomatic passport is issued to a 
Foreign Service Officer, a person in the diplomatic service or to a 
person having diplomatic status either because of the nature of his or 
her foreign mission or by reason of the office he or she holds. Where 
appropriate, dependents of such persons may be issued diplomatic 
passports.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.4  Validity of passports.

    (a) Signature of bearer. A passport is valid only when signed by the 
bearer in the space designated for his signature.
    (b) Period of validity of a regular passport.
    (1) A regular passport issued on or after February 1, 1998, to an 
applicant 16 years of age or older is valid for 10 years from date of 
issue unless limited by the Secretary to a shorter period.
    (2) A regular passport issued on or after February 1, 1998 to an 
applicant under the age of 16 years is valid for 5 years from date of 
issue unless limited by the Secretary of State to a shorter period.
    (3) The period of validity of a regular passport issued on or after 
January 1, 1983, and before February 1, 1998, unless limited by the 
Secretary of State to a shorter period is: 10 years from date of issue 
if issued to an applicant age 18 or older; five years from date of issue 
if issued to an applicant under age 18.
    (4) The period of validity of a regular passport issued prior to 
January 1, 1983, is five years from date of issue.
    (c) Period of validity of an official passport. An official passport 
is normally valid for a period of 5 years from the date of issue as long 
as the bearer maintains the official status for which it is issued. It 
must be returned to the Department upon the termination of the bearer's 
official status.
    (d) Period of validity of a diplomatic passport. A diplomatic 
passport issued on or after January 1, 1977 is valid for a period of 
five (5) years or so long as the bearer maintains his/her diplomatic 
status, whichever is shorter. A diplomatic passport which has not 
expired must be returned to the Department upon the termination of the 
bearer's diplomatic status or at such other time as the Secretary shall 
determine. Any outstanding diplomatic passport issued before January 1, 
1977 will expire effective December 31, 1977.
    (e) Period of a regular passport issued for no fee. A regular 
passport for which payment of the fee has been excused is valid for a 
period of 5 years from the date of issue unless limited by the Secretary 
to a shorter period.
    (f) Limitation and extension of validity. The validity period of any 
passport may be limited by the Secretary to less than the normal 
validity period. Applications for extension of passports limited to less 
than the normal full validity period must be made in writing and must be 
submitted, with the passport, to a passport issuing Office. In no event 
may a passport be extended beyond the normal period of validity 
prescribed for such passport by paragraphs (b) through (e) of this 
section.
    (g) Cancellation of passport endorsed as valid only for travel to 
Israel. The validity of any passport which has been issued and endorsed 
as valid only for travel to Israel is cancelled effective April 25, 
1992. Where it is determined that its continued use is warranted, the 
validity of such passport may be

[[Page 244]]

renewed or extended for additional periods of two years upon 
cancellation of the Israel-only endorsement. In no event may the 
validity of such passport be extended beyond the normal period of 
validity prescribed for such passport by paragraphs (b) through (e) of 
this section.

(Sec. 1, 44 Stat. 887; sec. 1, 41 Stat. 750; sec. 2, 44 Stat. 887; sec. 
4, 63 Stat. 111, as amended (22 U.S.C. 211a, 214, 217a, 2658); E.O. 
11295, 36 FR 10603; 3 CFR 1966-70 Comp. p. 507)
[31 FR 13540, Oct. 20, 1966, as amended at 33 FR 12042, Aug. 24, 1968; 
42 FR 17869, Apr. 4, 1977; 47 FR 56329, Dec. 16, 1982; 57 FR 3282, Jan. 
29, 1992; 63 FR 7285, Feb. 13, 1998]



Sec. 51.5  [Reserved]



Sec. 51.6  Mutilation and alteration of passports.

    Any passport which has been materially changed in physical 
appearance or composition, or which includes unauthorized changes, 
obliterations, entries or photographs may be invalidated.



Sec. 51.7  Verification of passports.

    When required by the officials of a foreign government, an American 
Foreign Service office may verify a U.S. passport at the request of the 
bearer or of the foreign government.



Sec. 51.8  Cancellation of previously issued passport.

    (a) Upon applying for a new passport, an applicant shall submit for 
cancellation any previous passport still valid or potentially valid.
    (b) If an applicant is unable to produce such a passport for 
cancellation, he or she shall submit a signed statement setting forth 
the circumstances surrounding the disposition of the passport and if it 
is claimed to have been lost, the efforts made to recover it. A 
determination will then be made whether to issue a new passport and 
whether such passport shall be limited as to place and periods of 
validity.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 31 FR 14521, Nov. 11, 1966; 
49 FR 16989, Apr. 23, 1984]



Sec. 51.9  Passport property of the U.S. Government.

    A passport shall at all times remain the property of the United 
States and shall be returned to the Government upon demand.



                         Subpart B--Application



Sec. 51.20  General.

    An application for a passport or for an amendment of a passport 
shall be completed upon such forms as may be prescribed by the 
Department. The passport applicant shall truthfully answer all 
questions, and shall state each and every material matter of fact, 
pertaining to his or her eligibility for a passport. All information and 
evidence submitted in connection with an application shall be considered 
a part thereof.

(22 U.S.C. 2658 and 3926)
[33 FR 12043, Aug. 24, 1968, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.21  Execution of passport application.

    (a) First time applicants or persons who have not been issued a 
passport within the past twelve years. A person who has never been 
issued a passport in his or her own name, or who has not been issued a 
passport in his or her own name within 12 years of the date of a new 
application, shall appear in person before a person authorized by the 
Secretary to give oaths, verify the application by oath or affirmation 
before that authorized person, provide two recent photographs, and pay 
the established fees.
    (b) Persons authorized by the Secretary to give oaths. The following 
persons are authorized by the Secretary to give oaths for passport 
purposes unless withdrawn by the Secretary in an individual case:
    (1) A passport agent;
    (2) A clerk of any Federal court;
    (3) A clerk of any State court of record or a judge or clerk of any 
probate court;
    (4) A postal employee designated by the postmaster at a post office 
which has been selected to accept passport applications;

[[Page 245]]

    (5) A U.S. citizen employee of the Department of Defense designated 
by the Secretary of Defense to accept passport applications at a 
military installation within the continental United States selected to 
accept passport applications;
    (6) A diplomatic officer, a consular officer, an overseas 
nationality examiner, a consular agent or a notarial officer abroad; or
    (7) Any other persons specifically designated by the Secretary.
    (c) Persons in the United States who have previously been issued a 
full validity passport. A person in the United States who has been 
issued a passport in his or her own name may obtain a new passport by 
filling out and mailing a specially prescribed application together with 
his or her previous passport, two recent photographs, and the 
established fee to the nearest U.S. passport agency, provided:
    (1) The most recently issued previous passport was issued when the 
applicant was 18 years of age or older.
    (2) The application is made not more than 12 years following the 
issue date of the previous passport;
    (3) The most recently issued previous passport is submitted with the 
new application.
    (d) Persons outside of the United States who have previously been 
issued a full validity passport. In a foreign country in which a U.S. 
consular district has been designated by the Secretary to receive such 
passport applications, a person who has been issued a passport in his or 
her own name may obtain a new passport by filling out a specially 
prescribed application and sending it (by mail or as prescribed by the 
Secretary), together with his or her previous passport, two recent 
photographs, and the established fee to the consular office in the 
consular district in which he or she is present, provided:
    (1) The most recently issued passport was issued when the applicant 
was 18 years of age or older.
    (2) The application is made not more than 12 years following the 
issue date of the previous passport;
    (3) The most recently issued previous passport is submitted with the 
new application.
    (4) In a Consular district specifically authorized by the Secretary 
to waive personal appearance of minors in accordance with this 
subsection, a U.S. consular officer may waive the age requirement 
established for use of the mail application, where the consular officer 
determines that:
    (i) The minor and, if applicable, the U.S. citizen parent(s) or 
legal guardian are registered in that consular district;
    (ii) The minor is not subject to the provisions of subsection 51.27 
(c) or (d);
    (iii) The waiver of the age requirement is otherwise in the interest 
of consular efficiency; and,
    (iv) The waiver will not otherwise compromise the integrity of the 
passport application process.
[44 FR 19393, Apr. 3, 1979, as amended at SD-165, 46 FR 2343, Jan. 9, 
1981; 46 FR 16257, Mar. 12, 1981; 51 FR 20475, June 5, 1986; 55 FR 
21538, May 25, 1990; 57 FR 59807, Dec. 16, 1992; 61 FR 43312, Aug. 22, 
1996]



Sec. 51.22  [Reserved]



Sec. 51.23  Name of applicant to be used in passport.

    The passport application shall contain the full name of the 
applicant. The applicant shall explain any material discrepancies 
between the name to be placed in the passport and the name recited in 
the evidence of citizenship and identity submitted. The passport issuing 
office may require documentary evidence or affidavits of persons having 
knowledge of the facts to support the explanation of the discrepancies.
[SD-165, 46 FR 2343, Jan. 9, 1981]



Sec. 51.24  Change of name.

    An applicant whose name has been changed by court order or decree 
shall submit with his or her application a certified copy of the order 
or decree. An applicant who has changed his or her name by the adoption 
of a new name without formal court proceedings shall submit with his or 
her application evidence that he or she has publicly and exclusively 
used the adopted name over a long period of time.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]

[[Page 246]]



Sec. 51.25  Photographs.

    (a) Photographs of bearer. The applicant shall submit with his or 
her application duplicate photographs of the size specified in the 
application. The photographs should be sufficiently recent to be a good 
likeness of and satisfactorily identify the applicant. The photographs 
shall be signed in the same manner and form as required in the 
application.
    (b) Photographs of uniformed personnel. Only applicants who are in 
the active service of the Armed Forces and proceeding abroad in the 
discharge of their duties may submit photographs in the uniform of the 
Armed Forces of the United States.
    (c) Unacceptable photographs. A photograph with a waxed back or 
other coating which lessens adhesiveness is not acceptable. Newspaper or 
magazine pictures, snapshots, or full length photographs are not 
acceptable. Photographs of persons in the uniform of a civilian 
organization, except religious dress, will not generally be accepted.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 43 FR 1791, Jan. 12, 1978; 44 
FR 19394, Apr. 3, 1979; SD-165, 46 FR 2343, Jan. 9, 1981; 49 FR 16989, 
Apr. 23, 1984]



Sec. 51.26  Incompetents.

    A parent, a legal guardian, or a person in loco parentis shall 
execute a passport application on behalf of a person declared 
incompetent.



Sec. 51.27  Minors.

    (a) Definitions. A minor is an unmarried person under the age of 18 
years.
    (b) Execution of application for minors. (1) A minor of age 13 years 
or above shall execute an application on his or her own behalf unless in 
the judgment of the person before whom the application is executed it is 
not desirable for the minor to execute his or her own application. In 
such case it must be executed by a parent or guardian of the minor, or 
by a person in loco parentis.
    (2) A parent, a guardian, or person in loco parentis shall execute 
the application for minors under the age of 13 years. Applications may 
be executed by either parent, regardless of the parent's citizenship. 
Permission of or notification to the other parent will not be required 
unless such permission or notification is required by a court order 
registered with the Department of State by an objecting parent as 
provided in paragraph (d)(1) of this section.
    (3) The passport issuing office may require a minor under the age of 
18 years to obtain and submit the written consent of a parent, a legal 
guardian or a person in loco parentis to the issuance of the passport.
    (c) Objection by parent, guardian or person in loco parentis in 
cases not involving a custody dispute. At any time prior to the issuance 
of a passport to a minor, the application may be disapproved and a 
passport will be denied upon receipt of a written objection from a 
person having legal custody of the minor.
    (d) Objection by parent, guardian or person in loco parentis in 
cases where minors are the subject of a custody dispute.
    (1)(i) When there is a dispute concerning the custody of a minor, a 
passport may be denied if the Department has on file a court order 
granted by a court of competent jurisdiction in the United States or 
abroad which: (A) Grants sole custody to the objecting parent; or, (B) 
Establishes joint legal cutody; or, (C) Prohibits the child's travel 
without the permission of both parents or the court; or, (D) Requires 
the permission of both parents or the court for important decisions, 
unless permission is granted in writing as provided therein. (ii) For 
passport issuance purposes,a court order providing for joint legal 
custody will be interpreted as requiring the permission of both parents. 
The Department will consider a court of competent jurisdiction to be a 
U.S. state court or a foreign court located in the child's home state or 
place of habitual residence. Notwithstanding the existence of any such 
court order, a passport may be issued when compelling humanitarian or 
emergency reasons relating to the welfare of the child exist.
    (2) Either parent may obtain information regarding the application 
for and issuance of a passport to a minor unless the inquiring parent's 
parental rights have been terminated by a court

[[Page 247]]

order which has been registered with the appropriate office at the 
Department of State; provided, however, that the Department may deny 
such information to any parent if it determines that the minor is of 
sufficient maturity to assert a privacy interest in his/her own right, 
in which case the minor's written consent to disclosure shall be 
required.
    (3) The Department may require that conflicts regarding custody 
orders, whether domestic or foreign, be settled by the appropriate court 
before a passport may be issued.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 61 FR 6505, Feb. 21, 1996]



Sec. 51.28  Identity of applicant.

    (a) If the applicant is not personally known to the official 
receiving the application he or she shall establish his or her identity 
by the submission of a previous passport, other identifying documents or 
by an identifying witness.
    (b) If an applicant submits an application under the provisions of 
paragraph (c) of Sec. 51.21 he or she must submit a prior passport with 
his or her application.
    (c) Any official receiving an application for a passport or any 
Passport Issuing Office may require such additional evidence of identity 
as may be deemed necessary.

(22 U.S.C. 2658 and 3926)
[33 FR 12043, Aug. 24, 1968, as amended at SD-165, 46 FR 2343, Jan. 9, 
1981; 49 FR 16989, Apr. 23, 1984]



Sec. 51.30  Persons unacceptable as witnesses.

    The passport issuing office will not accept as witness to a passport 
application a person who has received or expects to receive a fee for 
his services in connection with executing the application or obtaining 
the passport.



Sec. 51.31  Affidavit of identifying witness.

    (a) An identifying witness shall execute an affidavit stating: That 
he or she resides at a specific address; that he or she knows or has 
reason to believe that the applicant is a citizen of the United States; 
the basis of his or her knowledge concerning the applicant; and that the 
information set out in his or her affidavit is true to the best of his 
or her knowledge and belief.
    (b) If the witness has a U.S. passport, he or she shall state the 
place of issue and, if possible, the number and approximate date of 
issue.
    (c) The identifying witness shall subscribe to his or her statement 
before the same person who took the passport application.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 31 FR 14522, Nov. 11, 1966; 
49 FR 16989, Apr. 23, 1984]



Sec. 51.32  Amendment of passports.

    Applicants for amendment of a passport shall be made on forms 
prescribed by the Department.
[SD-165, 46 FR 2343, Jan. 9, 1981]



Sec. 51.33  Release of passport information.

    Information in passport files is subject to the provisions of the 
Freedom of Information Act (FOIA) and the Privacy Act. Release of this 
information may be requested in accordance with the implementing 
regulations set forth in Subchapter R, Part 171 or Part 172 of this 
title.

(22 U.S.C. 2658 and 3926; 5 U.S.C. 552, 552a)
[61 FR 29940, June 13, 1996]



         Subpart C--Evidence of U.S. Citizenship or Nationality



Sec. 51.40  Burden of proof.

    The applicant has the burden of proving that he or she and any 
persons to be included in the passport are nationals of the United 
States.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.41  Documentary evidence.

    Every application shall be accompanied by evidence of the U.S. 
nationality of the applicant and of any other person to be extended 
passport services.

[[Page 248]]



Sec. 51.43  Persons born in the United States applying for a passport for the first time.

    (a) Primary evidence of birth in the United States. A person born in 
the United States in a place where official records of birth were kept 
at the time of his or her birth shall submit with the application for a 
passport a birth certificate under the seal of the official custodian of 
birth records. To be acceptable, a certificate must show the full name 
of the applicant place and date of birth, and that the record thereof 
was recorded at the time of birth or shortly thereafter.
    (b) Secondary evidence of birth in the United States. If the 
applicant cannot submit primary evidence of birth, he or she shall 
submit the best obtainable secondary evidence. If a person was born at a 
place in the United States when birth records were filed, he or she must 
submit a ``no record'' certification from the official custodian of such 
birth records before secondary evidence may be considered. The passport 
issuing office will consider, as secondary evidence, baptismal 
certificates, certificates of circumcision, or other documentary 
evidence created shortly after birth but not more than 5 years after 
birth, and/or affidavits of persons having personal knowledge of the 
facts of the birth.

(22 U.S.C. 2658 and 3926)
[38 FR 4667, Feb. 20, 1973, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.44  Persons born abroad applying for a passport for the first time.

    (a) Naturalization in on right. A person naturalized in his or her 
own right as a U.S. citizen shall submit with his or her application his 
or her certificate of naturalization.
    (b) Derivative citizenship at birth. (1) An applicant who claims to 
have derived citizenship by virtue of his or her birth abroad to a U.S. 
citizen parent or parents may submit his or her won certificate of 
citizenship (Section 1993, Revised Statutes, as amended by Act of May 
24, 1934; section 201 of the Nationality Act of 1940; section 301 of the 
Immigration and Nationality Act of 1952).
    (2) In lieu of a certificate of citizenship, the applicant may 
submit evidence of his or her parent(s)' citizenship at the time of his 
or her birth, and evidence of his or her and his or her parent(s)' 
residence and physical presence in the United States. The passport 
issuing office may require the applicant to establish the marriage of 
his or her parents and/or grandparents and his or her relationship to 
them.
    (c) Derivative citizenship subsequent to birth. (1) An applicant who 
claims U.S. citizenship by virtue of the naturalization of his or her 
parent or parents subsequent to his or her birth may submit his or her 
own certificate of citizenship.
    (2) In lieu of a certificate of citizenship the applicant may submit 
the naturalization certificate of the parent or parents through whom he 
or she claims U.S. citizenship. In this case, he or she must also show 
that he or she resided in the United States during minority as required 
by the law under which he or she claims citizenship.
    (3) If an applicant claims citizenship through a mother who resumed 
citizenship or parent who was repatriated, he or she must submit 
evidence thereof. The applicant must establish also that he or she 
resided in the United States for the period prescribed by law.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]

                              Married Women



Sec. 51.45  Marriage to an alien prior to March 2, 1907.

    A woman citizen of the United States who married an alien prior to 
March 2, 1907, did not lose her U.S. citizenship unless she acquired as 
a result of the marriage the nationality of her husband and thereafter 
took up a permanent residence abroad prior to September 22, 1922.



Sec. 51.46  Marriage to an alien between March 2, 1907, and September 22, 1922.

    (a) A woman citizen of the United States who married an alien 
between March 2, 1907, and September 22, 1922, lost her U.S. 
citizenship, except as provided in paragraph (b) of this section.

[[Page 249]]

At the termination of the marital relation she could resume her U.S. 
citizenship, if abroad, by registering as a U.S. citizen within 1 year 
with a Consul of the United States, or by returning to reside in the 
United States, or, if resident in the United States, by continuing to 
reside therein. (Section 3 of the Act of March 2, 1907.)
    (b) A woman citizen of the United States who married an alien 
between April 6, 1917, and July 2, 1921, did not lose her citizenship, 
if the marriage terminated by death or divorce prior to July 2, 1921, or 
if her husband became a U.S. citizen prior to that date. She may 
establish her citizenship by proving her U.S. citizenship prior to 
marriage and the termination of the marriage or acquisition of U.S. 
citizenship by her husband prior to July 2, 1921.



Sec. 51.47  Marriage prior to September 22, 1922, to an alien who acquired U.S. citizenship by naturalization prior to September 22, 1922.

    A woman citizen of the United States who lost her citizenship by 
virtue of her marriage to an alien between March 2, 1907, and September 
22, 1922, and who reacquired U.S. citizenship through the naturalization 
of her husband prior to September 22, 1922, may establish her U.S. 
citizenship by submitting her husband's certificate of naturalization.



Sec. 51.48  Marriage between September 22, 1922, and March 3, 1931, to an alien ineligible to citizenship.

    A woman citizen of the United States who lost her U.S. citizenship 
by virtue of her marriage to an alien ineligible to citizenship between 
September 22, 1922, and March 3, 1931, but who reacquired her 
citizenship by naturalization in accordance with applicable law shall 
submit with her application her certificate of naturalization (sec. 3 of 
the Act of Mar. 3, 1931).



Sec. 51.49  Marriage on or after September 22, 1922, to an alien eligible to naturalization.

    A woman citizen of the United States who on or after September 22, 
1922, married an alien eligible for naturalization did not thereby lose 
her U.S. citizenship and need only submit evidence of her own 
citizenship before a passport issuing office.



Sec. 51.50  Alien born woman--marriage to citizen prior to September 22, 1922.

    An alien woman who acquired U.S. citzenship by virtue of her 
marriage to a citizen of the United States prior to September 22, 1922, 
shall submit with her application evidence of her husband's citizenship 
and of the marriage. (Section 1994 of the Revised Statutes.)

                Citizenship by Act of Congress or Treaty



Sec. 51.51  Former nationals of Spain or Denmark.

    Former nationals of Spain or Denmark who acquired nationality or 
citizenship of the United States under an act of Congress or treaty by 
virtue of residence in territory under the sovereignty of the United 
States shall submit evidence of their former nationality and of their 
residence in such territory.



Sec. 51.52  Citizenship by birth in territory under sovereignty of the United States.

    A person claiming nationality or citizenship of the United States 
under an act of Congress or treaty by virtue of his or her birth in 
territory under the sovereignty of the United States shall submit 
evidence of his birth in such territory.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.53  Proof of resumption of U.S. citizenship.

    An applicant who claims that he or she resumed U.S. citizenship or 
was repatriated under any of the nationality laws of the United States 
shall submit with the application a certificate of naturalization, a 
certificate of repatriation or evidence of the fact that he or she took 
an oath of allegiance in accordance with the applicable provisions of 
the law. (Act of June 29, 1906, as amended by Act of May 9, 1918; Act of 
June 25, 1936, as amended by Act of July 2, 1940, sections 317(b) and 
323 of the Nationality Act of 1940 as amended

[[Page 250]]

by Acts of April 2, 1942, and August 7, 1946; Act of August 16, 1951, as 
amended by section 402(j) of the Immigration and Nationality Act of 
1952; sections 324 and 327 of the Immigration and Nationality Act of 
1952; Act of July 20, 1954).

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.54  Requirement of additional evidence of U.S. citizenship.

    Nothing contained in Secs. 51.43 through 51.53 shall prohibit the 
Department from requiring an applicant to submit other evidence deemed 
necessary to establish his or her U.S. citizenship or nationality.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.55  Return or retention of evidence of citizenship.

    The passport issuing office will generally return to the applicant 
evidence submitted in connection with an application for passport 
facilities. However, the passport issuing office may retain evidence 
when it deems necessary.



                             Subpart D--Fees



Sec. 51.60  Form of remittance.

    Passport fees in the United States shall be paid in U.S. currency or 
by draft, check, or money order payable to the Department of State or 
the Passport Office. Passport fees abroad shall be paid in U.S. 
currency, travelers checks, money order, or the equivalent value of the 
fees in local currency.
[31 FR 14522, Nov. 11, 1966]



Sec. 51.61  Passport fees.

    Fees, including execution fees, shall be collected for the following 
passport services in the amounts prescribed in the Schedule of Fees for 
Consular Services (22 CFR 22.1):
    (a) A fee for each passport issued, which fee shall vary depending 
on whether the passport is issued to a first-time applicant or a renewal 
applicant and on the age of the applicant. The passport issuance fee 
shall be paid by all applicants at the time of application, except as 
provided in Sec. 51.62(a).
    (b) A fee for execution of the passport application, except as 
provided in Sec. 51.62 (b), when the applicant is required to execute 
the application in person before a person authorized to administer oaths 
for passport purposes. This fee shall be collected as part of the 
passport issuance fee at the time of application and is not refundable 
(see 22 CFR 51.65). When execution services are provided by an official 
of a state or local government or of the United States Postal Service, 
the fee may be retained by that entity to cover the costs of service, 
pursuant to an appropriate agreement with the Department of State.
    (c) A fee for expedited services, if any, provided pursuant to 22 
CFR 51.66.
[63 FR 5103, Jan. 30, 1998]



Sec. 51.62  Exemption from payment of passport or execution fee.

    (a) The following persons are exempt from the payment of passport 
fees:
    (1) An officer or employee of the U.S. proceeding abroad on official 
business, or the members of his or her immediate family authorized to 
accompany or reside with him or her abroad. The applicant shall submit 
evidence of the official purpose of his or her travel and if applicable 
his or her authorization to have dependents accompany or reside with him 
or her abroad.
    (2) An American sailor who requires a passport in connection with 
his or her duties aboard an American flag-vessel.
    (3) A widow, child, parent, brother, or a sister of a deceased 
American service member proceeding abroad to visit the grave of such 
service member.
    (4) An employee of the United Seamen's Service who requires a 
passport for travel to assume or perform duties thereof. The applicant 
shall submit with his or her application a letter from the United 
Seamen's Service certifying that he or she is proceeding abroad on 
official business to provide facilities and services for U.S. merchant 
seamen.
    (b) No person described in paragraph (a) (1), (2), (3), or (4) of 
this section shall be required to pay an execution fee when his or her 
application is executed before a Federal official.


[[Page 251]]


(22 U.S.C. 2658 and 3926)
[33 FR 12043, Aug. 24, 1968, as amended at 37 FR 6053, Mar. 24, 1972; 49 
FR 16989, Apr. 23, 1984; Redesignated at 63 FR 5103, Jan. 30, 1998.]



Sec. 51.63  Refunds.

    A collected passport fee shall be refunded:
    (a) To any person exempt from the payment of passport fees under 
Sec. 51.62 from whom fees were erroneously collected.
    (b) To any person refused a visa within the United States by the 
appropriate officer of a foreign government, provided that the unused 
passport is returned and a written request for a refund is made within 6 
months of the date of issue of the passport.
    (c) To any applicant whose passport is not issued.
    (d) To the executor or administrator of the estate of the deceased 
bearer of an unused passport.
    (e) For procedures on refunds of $5.00 or less see Sec. 22.6(b) of 
this title.
    (f) The passport expedite fee will be refunded if the Passport 
Agency does not provide the requested expedited processing as defined in 
Sec. 51.66.
[33 FR 12043, Aug. 24, 1968, as amended at 52 FR 29515, Aug. 10, 1987; 
59 FR 48999, Sept. 26, 1994; Redesignated and amended at 63 FR 5103, 
Jan. 30, 1998]



Sec. 51.64  Replacement passports.

    A passport issuing office shall issue a replacement passport without 
payment of a fee:
    (a) To correct an error or rectify a mistake of the Department.
    (b) When exceptional circumstances exist as determined by the 
Secretary.
[31 FR 13540, Oct. 20, 1966. Redesignated at 63 FR 5103, Jan. 30, 1998]



Sec. 51.65  Execution fee not refundable.

    The fee for the execution of a passport application cannot be 
refunded.
[31 FR 13540, Oct. 20, 1966. Redesignated at 63 FR 5103, Jan. 30, 1998]



Sec. 51.66  Expedited passport processing.

    (a) Within the United States, an applicant for a passport service 
(including issuance, amendment, extension, or the addition of visa 
pages) may request expedited processing by a Passport Agency. All 
requests by applicants for in-person services at a Passport Agency shall 
be considered requests for expedited processing, unless the Department 
has determined that the applicant is required to apply at a U.S. 
Passport Agency.
    (b) Expedited passport processing shall mean completing processing 
within 3-business days commencing when the application reaches a 
Passport Agency or, if the application is already with a Passport 
Agency, commencing when the request for expedited processing is 
approved. The processing will be considered completed when the passport 
is ready to be picked up by the applicant or is mailed to the applicant.
    (c) A fee shall be collected for expedited processing service in the 
amount prescribed in the Schedule of Fees for Consular Services (22 CFR 
22.1). This amount will be in addition to any other applicable fee and 
does not include urgent mailing costs, if any.
    (d) A request for expedited processing normally will be accepted 
only if the applicant can document urgent departure with airline tickets 
showing confirmed reservation or similar evidence. The Passport Agency 
may decline to accept the request if it is apparent at the time it is 
made that the request cannot be granted.
    (e) The expedite fee may be waived only where the need for expedited 
processing was necessary due to Department error, mistake or delay.
[59 FR 49000, Sept. 26, 1994. Redesignated and amended at 63 FR 5103, 
Jan. 30, 1998]



       Subpart E--Limitation on Issuance or Extension of Passports



Sec. 51.70  Denial of passports.

    (a) A passport, except for direct return to the United States, shall 
not be issued in any case in which the Secretary of State determines or 
is informed by competent authority that:
    (1) The applicant is the subject of an outstanding Federal warrant 
of arrest for a felony, including a warrant issued under the Federal 
Fugitive Felon Act (18 U.S.C. 1073); or

[[Page 252]]

    (2) The applicant is subject to a criminal court order, condition of 
probation, or condition of parole, any of which forbids departure from 
the United States and the violation of which could result in the 
issuance of a Federal warrant of arrest, including a warrant issued 
under the Federal Fugitive Felon Act; or
    (3) The applicant is subject to a court order committing him or her 
to a mental institution; or
    (4) The applicant is the subject of a request for extradition or 
provisional arrest for extradition which has been presented to the 
government of a foreign country; or
    (5) The applicant is the subject of a subpoena issued pursuant to 
section 1783 of title 28, United States Code, in a matter involving 
Federal prosecution for, or grand jury investigation of, a felony; or
    (6) The applicant has not repaid a loan received from the United 
States as prescribed under Secs. 1.10 and 71.11 of this chapter; or
    (7) The applicant is in default on a loan received from the United 
States to effectuate his or her return from a foreign country in the 
course of travel abroad; or
    (8) The applicant has been certified by the Secretary of Health and 
Human Services as notified by a State agency under 42 U.S.C. 652(k) to 
be in arrears of child support in an amount exceeding $5,000.00.
    (b) A passport may be refused in any case in which the Secretary of 
State determines or is informed by competent authority that:
    (1) The applicant has not repaid a loan received from the United 
States to effectuate his or her return from a foreign country in the 
course of travel abroad; or
    (2) The applicant has been legally declared incompetent unless 
accompanied on his or her travel abroad by the guardian or other person 
responsible for the national's custody and well being; or
    (3) The applicant is under the age of 18 years, unmarried and not in 
the military service of the United States unless a person having legal 
custody of such national authorizes issuance of the passport and agrees 
to reimburse the United States for any monies advanced by the United 
States for the minor to return to the United States; or
    (4) The Secretary determines that the national's activities abroad 
are causing or are likely to cause serious damage to the national 
security or the foreign policy of the United States; or
    (5) The applicant has been the subject of a prior adverse action 
under this section or Sec. 51.71 and has not shown that a change in 
circumstances since the adverse action warrants issuance of a passport; 
or
    (6) The applicant is subject to an order of restraint or 
apprehension issued by an appropriate officer of the United States Armed 
Forces pursuant to chapter 47 of title 10 of the United States Code.

(Approved by the Office of Management and Budget under control number 
1405-0077)

[54 FR 8531, Mar. 1, 1989, as amended at 62 FR 62695, Nov. 25, 1997]



Sec. 51.71  Denial of passports to certain convicted drug traffickers.

    (a) A passport shall not be issued in any case in which the 
Secretary of State determines or is informed by competent authority that 
the applicant is subject to imprisonment or supervised release as the 
result of a felony conviction for a Federal or state drug offense if the 
individual used a U.S. passport or otherwise crossed an international 
border in committing the offense, including a felony conviction arising 
under:
    (1) The Controlled Substances Act (21 U.S.C. 801 et seq.) or the 
Controlled Substances Import and Export Act (21 U.S.C. 951 et seq.); or
    (2) Any Federal law involving controlled substances as defined in 
section 802 of the Controlled Substances Act (21 U.S.C. 801 et seq.); or
    (3) The Bank Secrecy Act (31 U.S.C. 5311 et seq.) or the Money 
Laundering Act (18 U.S.C. 1956 et seq.) if the Secretary of State is in 
receipt of information that supports the determination that the 
violation involved is related to ilicit production of or trafficking in 
a controlled substance; or

[[Page 253]]

    (4) Any state law involving the manufacture, distribution, or 
possession of a controlled substance.
    (b) A passport may be refused in any case in which the Secretary of 
State determines or is informed by competent authority that the 
applicant is subject to imprisonment or supervised release as the result 
of a misdemeanor conviction of a Federal or state drug offense if the 
individual used a U.S. passport or otherwise crossed an international 
border in committing the offense, other than a first conviction for 
possession of a controlled substance, including a misdemeanor conviction 
arising under:
    (1) The federal statutes described in Sec. 51.71(a); or
    (2) Any state law involving the manufacture, distribution, or 
possession of a controlled substance.
    (c) Notwithstanding paragraphs (a) and (b) of this section the 
Secretary of State may issue a passport when the competent authority 
confirms, or the Secretary of State otherwise finds, that emergency 
circumstances or humanitarian reasons exist.

(Approved by the Office of Management and Budget under control number 
1405-0077)

[54 FR 8532, Mar. 1, 1989]



Sec. 51.72  Revocation or restriction of passports.

    A passport may be revoked or restricted or limited where:
    (a) The national would not be entitled to issuance of a new passport 
under Sec. 51.70 or Sec. 51.71; or
    (b) The passport has been obtained by fraud, or has been 
fraudulently altered, or has been fraudulently misused.
[54 FR 8532, Mar. 1, 1989]



Sec. 51.73  Passports invalid for travel into or through restricted areas.

    (a) Unless specifically validated therefore, U.S. passports shall 
cease to be valid for travel into or through a country or area which the 
Secretary has determined is:
    (1) A country with which the United States is at war, or
    (2) A country or area where armed hostilities are in progress; or
    (3) A country or area in which there is imminent danger to the 
public health or physical safety of United States travelers.
    (b) Any determination made under paragraph (a) of this section shall 
be published in the Federal Register along with a statement of the 
circumstances requiring this restriction.
    (c) Unless limited to a shorter period, any such restriction shall 
expire at the end of one year from the date of publication of such 
notice in the Federal Register, unless extended or sooner revoked by the 
Secretary by public notice.
[45 FR 11128, Feb. 20, 1980. Redesignated at 54 FR 8532, Mar. 1, 1989]



Sec. 51.74  Special validation of passports for travel to restricted areas.

    (a) A United States National wishing a validation of his passport 
for travel to, in, or through a restricted country or area may apply for 
a special validation to the Office of Passport Services, a passport 
agency, or a foreign service post authorized to issue passports. The 
application shall be accompanied by evidence that the applicant falls 
within the standards set out in paragraph (c) of this section.
    (b) The Assistant Secretary of State for Consular Affairs or an 
authorized designee of that official shall decide whether or not to 
grant a special validation. The special validation shall be granted only 
when such action is determined to be in the national interest of the 
United States.
    (c) An application may be considered if:
    (1) The applicant is a professional reporter, the purpose of whose 
trip is to obtain, and make available to the public, information about 
the restricted area; or
    (2) The applicant is a representative of the American Red Cross; or
    (3) The applicant establishes that his or her trip is justified by 
compelling humanitarian considerations; or
    (4) The applicant's request is otherwise in the national interest.

(Sec. 1, 44 Stat. 887, as amended (22 U.S.C. 211a); sec. 4, 63 Stat. 
111, as amended (22 U.S.C. 2658); E.O. 11295, 36 FR 10603; 3 CFR 1966-70 
Comp., 507; E.O. 12211, 45 FR 26685)
[45 FR 30619, May 9, 1980. Redesignated at 54 FR 8532, Mar. 1, 1989]

[[Page 254]]



Sec. 51.75  Notification of denial or withdrawal of passport.

    Any person whose application for issuance of a passport has been 
denied, or who has otherwise been the subject of an adverse action taken 
on an individual basis with respect to his or her right to receive or 
use a passport shall be entitled to notification in writing of the 
adverse action. The notification shall set forth the specific reasons 
for the adverse action and the procedures for review available under 
Secs. 51.81 through 51.105.

(22 U.S.C. 2658 and 3926)
[33 FR 12043, Aug. 24, 1968, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.76  Surrender of passport.

    The bearer of a passport which is revoked shall surrender it to the 
Department or its authorized representative upon demand and upon his or 
her refusal to do so such passport may be invalidated by notifying the 
bearer in writing of the invalidation.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



           Subpart F--Procedures for Review of Adverse Action



Sec. 51.80  Applicability of Secs. 51.81 through 51.89.

    The provisions of Secs. 51.81 through 51.89 shall not apply to any 
action of the Secretary of State taken on an individual basis in 
denying, restricting, revoking or invalidating a passport or in any 
other way adversely affecting the ability of a person to receive or use 
a passport by reason of:
    (a) Noncitizenship.
    (b) Refusal under the provisions of Sec. 51.70(a)(8),
    (c) Refusal to grant a discretionary exception under the emergency 
or humanitarian relief provisions of Sec. 51.71(c), or
    (d) Refusal to grant a discretionary exception from geographical 
limitations of general applicability. The provisions of this subpart 
shall otherwise constitute the administrative remedies provided by the 
Department to persons who are the subject of adverse action under 
Sec. 51.70, Sec. 51.71 or Sec. 51.72.
[62 FR 62695, Nov. 25, 1997]



Sec. 51.81  Time limits on hearing to review adverse action.

    A person who has been the subject of an adverse action with respect 
to his or her right to receive or use a passport shall be entitled, upon 
request made within 60 days after receipt of notice of such adverse 
action, to require the Department or the appropriate Foreign Service 
post, as the case may be, to establish the basis for its action in a 
proceeding before a hearing officer. If no such request is made within 
60 days, the adverse action will be considered final and not subject to 
further administrative review. If such request is made within 60 days, 
the adverse action shall be automatically vacated unless such proceeding 
is initiated by the Department or the appropriate Foreign Service post, 
as the case may be, within 60 days after request, or such longer period 
as is requested by the person adversely affected and agreed to by the 
hearing officer.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.82  Notice of hearing.

    The person adversely affected shall receive not less than 5 business 
days' notice in writing of the scheduled date and place of the hearing.



Sec. 51.83  Functions of the hearing officer.

    The hearing officer shall act on all requests for review under 
Sec. 51.81. He shall make findings of fact and submit recommendations to 
the Administrator of the Bureau of Security and Consular Affairs. In 
making his or her findings and recommendations, the hearing officer 
shall not consider confidential security information unless that 
information is made available to the person adversely affected and is 
made part of the record of the hearing.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]

[[Page 255]]



Sec. 51.84  Appearance at hearing.

    The person adversely affected may appear at the hearing in person or 
with his or her attorney, or by his or her attorney. The attorney must 
possess the qualifications prescribed for practice before the Board of 
Appellate Review or be admitted to practice before the courts of the 
country in which the hearing is to be held.

(22 U.S.C. 2658 and 3926)
[36 FR 9068, May 19, 1971, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.85  Proceedings before the hearing officer.

    The person adversely affected may appear and testify in his or her 
own behalf and may himself, or by his or her attorney, present witnesses 
and offer other evidence and make argument. If any witness whom the 
person adversely affected wishes to call is unable to appear in person, 
the hearing officer may, in his or her discretion, accept an affidavit 
by the witness or order evidence to be taken by deposition. The person 
adversely affected shall be entitled to be informed of all the evidence 
before the hearing officer and of the source of such evidence, and shall 
be entitled to confront and cross-examine any adverse witness. The 
person shall, upon request by the hearing officer, confirm his or her 
oral statements in an affidavit for the record.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.86  Admissibility of evidence.

    The person adversely affected and the Department may introduce such 
evidence as the hearing officer deems proper. Formal rules of evidence 
shall not apply, but reasonable restrictions shall be imposed as to 
relevancy, competency and materiality of evidence presented.



Sec. 51.87  Privacy of hearing.

    The hearing shall be private. There shall be present at the hearing 
only the person adversely affected, his or her attorney, the hearing 
officer, official stenographers, employees of the Department directly 
concerned with the presentation of the case, and the witnesses. 
Witnesses shall be present at the hearing only while actually giving 
testimony or when otherwise directed by the hearing officer.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.88  Transcript of hearing.

    A complete verbatim stenographic transcript shall be made of the 
hearing by a qualified reporter, and the transcript shall constitute a 
permanent part of the record. Upon request, the appellant or his or her 
counsel shall be entitled to inspect the complete transcript and to 
purchase a copy thereof.

(22 U.S.C. 2658 and 3926)
[31 FR 13540, Oct. 20, 1966, as amended at 49 FR 16989, Apr. 23, 1984]



Sec. 51.89  Decision of Assistant Secretary for Consular Affairs; notice of right to appeal.

    The person adversely affected shall be promptly notified in writing 
of the decision of the Assistant Secretary for Consular Affairs and, if 
the decision is adverse to him or her, the notification shall state the 
reasons for the decision and inform him or her of the right to appeal 
the decision to the Board of Appellate Review (part 7 of this chapter) 
within 60 days after receipt of notice of the adverse decision. If no 
appeal is made within 60 days, the decision will be considered final and 
not subject to further administrative review.
[44 FR 68827, Nov. 30, 1979]



PART 52--MARRIAGES--Table of Contents




Sec.
52.1  Celebration of marriage.
52.2  Authentication of marriage and divorce documents.
52.3  Certification as to marriage laws.

    Authority:  Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658.



Sec. 52.1  Celebration of marriage.

    Foreign Service officers are forbidden to celebrate marriages.
[31 FR 13546, Oct. 20, 1966]

[[Page 256]]



Sec. 52.2  Authentication of marriage and divorce documents.

    (a) Whenver a consular officer is requested to authenticate the 
signature of local authorities on a document of marriage when he was not 
a witness to the marriage, he shall include in the body of his 
certificate of authentication the qualifying statement, ``For the 
contents of the annexed document, the Consulate (General) assumes no 
responsibility.''
    (b) A consular officer shall include the same statement in 
certificates of authentication accompanying decrees of divorce.
[31 FR 13546, Oct. 20, 1966. Redesignated at 51 FR 26247, July 22, 1986]



Sec. 52.3  Certification as to marriage laws.

    Although a consular officer may have knowledge respecting the laws 
of marriage, he shall not issue any official certificate with respect to 
such laws.
[31 FR 13546, Oct. 20, 1966. Redesignated at 51 FR 26247, July 22, 1986]



PART 53--PASSPORT REQUIREMENT AND EXCEPTIONS--Table of Contents




Sec.
53.1  Passport requirement.
53.2  Exceptions.
53.3  Attempt of a citizen to enter without a valid passport.
53.4  Optional use of a valid passport.

    Authority:  8 U.S.C. 1185; Proc. 3004, 18 FR 489, 3 CFR, 1949-1953 
Comp., p. 180.

    Source:  31 FR 13546, Oct. 20, 1966, unless otherwise noted.



Sec. 53.1  Passport requirement.

    Under section 215(b) of the Immigration and Nationality Act (8 
U.S.C. 1185(b), it is unlawful except as otherwise provided for any 
citizen of the United States to depart from or enter, or attempt to 
depart from or enter, the United States without a valid passport.



Sec. 53.2  Exceptions.

    A U.S. citizen is not required to bear a valid passport to enter or 
depart the United States:
    (a) When traveling directly between parts of the United States as 
defined in Sec. 50.1 of this chapter;
    (b) When traveling between the United States and any country, 
territory, or island adjacent thereto in North, South or Central America 
excluding Cuba; provided, that this exception is not applicable to any 
such person when proceeding to or arriving from a place outside the 
United States for which a valid passport is required under this part if 
such travel is accomplished within 60 days of departure from the United 
States via any country or territory in North, South or Central America 
or any island adjacent thereto;
    (c) When traveling as a bona fide seaman or air crewman who is the 
holder of record of a valid merchant mariner identification document or 
air crewman identification card;
    (d) When traveling as a member of the Armed Forces of the United 
States on active duty;
    (e) When he is under 21 years of age and is a member of the 
household of an official or employee of a foreign government or of the 
United Nations and is in possession of or included in a foreign 
passport;
    (f) When he is a child under 12 years of age and is included in the 
foreign passport of an alien parent; however, such child will be 
required to provide evidence of his U.S. citizenship when entering the 
United States;
    (g) When the citizen entering the United States presents a card of 
identity and registration issued by a consular office abroad to 
facilitate travel to the United States; or
    (h) When specifically authorized by the Secretary of State through 
appropriate official channels to depart from or enter the United States, 
as defined in Sec. 50.1 of this chapter. The fee for a waiver of the 
passport requirement under this section shall be collected in the amount 
prescribed in the Schedule of Fees for Consular Services (22 CFR 22.1).
[31 FR 13546, Oct. 20, 1966, as amended at 37 FR 11459, June 8, 1972; 51 
FR 26247, July 22, 1986]



Sec. 53.3  Attempt of a citizen to enter without a valid passport.

    The appropriate officer at the port of entry shall report to the 
Secretary of State for the purpose of invoking the

[[Page 257]]

waiver provisions of Sec. 53.2(h), any citizen of the United States who 
attempts to enter the United States contrary to the provisions of this 
part.



Sec. 53.4  Optional use of a valid passport.

    Nothing in this part shall be construed to prevent a citizen from 
using a valid passport in a case in which that passport is not required 
by this part 53, provided such travel is not otherwise prohibited.

[[Page 258]]



                        SUBCHAPTER G--[RESERVED]



[[Page 259]]



SUBCHAPTER H--PROTECTION AND WELFARE OF AMERICANS, THEIR PROPERTY AND ESTATES





PART 71--PROTECTION AND WELFARE OF CITIZENS AND THEIR PROPERTY--Table of Contents




                      Subpart A--General Activities

Sec.
71.1  Protection of Americans abroad.
71.2  Requests for naval force in foreign port.
71.3  American claimants to foreign estates and inheritances.
71.4  Real property of deceased American citizens.
71.5  Storage or safekeeping of private property.
71.6  Services for distressed Americans.
71.7  Reports on catastrophes abroad.
71.8  Assistance to American Red Cross.
71.9  Presentation of Americans at foreign courts.

   Subpart B--Emergency Medical/Dietary Assistance for U.S. Nationals 
                           Incarcerated Abroad

71.10  Emergency medical assistance.
71.11  Short-term full diet program.
71.12  Dietary supplements.

    Authority:  Sec. 4, 63 Stat. 111, as amended (22 U.S.C. 2658, 2670); 
Pub. L. 95-45 (91 Stat. 221).

    Source:  22 FR 10841, Dec. 27, 1957, unless otherwise noted.



                      Subpart A--General Activities



Sec. 71.1  Protection of Americans abroad.

    Officers of the Foreign Service shall perform such duties in 
connection with the protection of American nationals abroad as may be 
imposed upon them by rules and regulations prescribed by the Secretary 
of State.



Sec. 71.2  Requests for naval force in foreign port.

    Diplomatic representatives and consular officers shall not request 
the presence of a naval force in a foreign port unless a public 
emergency so necessitates. The request may be addressed to the officers 
in command of the naval force, in which event responsibility of action 
rests with them, or it may be addressed to the Department of State. In 
either case, the request should contain detailed reasons for its 
submission.



Sec. 71.3  American claimants to foreign estates and inheritances.

    Where treaty provisions, local laws, or established usage permit, a 
consular officer should protect the interests of American citizens 
claiming foreign estates and inheritances.



Sec. 71.4  Real property of deceased American citizens.

    In the absence of special provisions by treaty the devolution and 
transfer of real property are covered by the law of the place where the 
property is situated. When real property is left by the decedent within 
the country where death occurs, or where the decedent was domiciled at 
the time of death, the consular officer, or diplomatic officer, if there 
be no consular officer, should if feasible informally observe the 
proceedings and report to the diplomatic mission or the Department any 
apparent irregularity or unnecessary delay in settling the estate.



Sec. 71.5  Storage or safekeeping of private property.

    Except in a public emergency, no officer of the Foreign Service 
shall accept private property for storage or safekeeping in the office 
or for transmission to some other destination, unless it is property 
belonging to the estate of a deceased American citizen, or property over 
which the officer has jurisdiction as a result of a catastrophe at sea. 
In public emergencies, officers may accept private property for storage 
and safekeeping or for transmission to another destination, provided the 
owner signs a statement to the effect that the property is being 
accepted for deposit at his request, at his own risk, and with full 
knowledge that neither the Government of the United States nor any of 
its officers assumes responsibility therefor.

[[Page 260]]



Sec. 71.6  Services for distressed Americans.

    Officers of the Foreign Service shall extend every possible aid and 
assistance within their power to distressed American citizens within 
their districts, but they shall not expend the funds nor pledge the 
credit of the Government of the United States for this purpose, except 
in the case of American seamen, or except as authorized by the 
Department of State.



Sec. 71.7  Reports on catastrophes abroad.

    Whenever a great catastrophe occurs abroad, either on land or on 
sea, the officer within whose district the catastrophe takes place or 
into whose district the survivors are brought shall report immediately 
by telegraph the names of any American citizens who have been killed or 
injured and the names of American citizens known to be safe.



Sec. 71.8  Assistance to American Red Cross.

    Officers and employees of the Foreign Service may cooperate fully 
with the American Red Cross within their respective districts and 
subject to the limitations prescribed in Sec. 102.806 (22 CFR, 1947 
Supp.). They shall, however, avoid taking an active part in the 
solicitation of memberships or the collection of funds.



Sec. 71.9  Presentation of Americans at foreign courts.

    The chief of the mission concerned may exercise his discretion in 
the matter of procuring the presentation of American citizens at the 
court of the country to which he is accredited.



   Subpart B--Emergency Medical/Dietary Assistance for U.S. Nationals 
                           Incarcerated Abroad

    Source:  42 FR 60141, Nov. 25, 1977, unless otherwise noted.



Sec. 71.10  Emergency medical assistance.

    (a) Eligibility criteria. A U.S. national incarcerated abroad is 
considered eligible to receive funded medical treatment under the 
following general criteria:
    (1) Adequate treatment cannot or will not be provided by prison 
authorities or the host government;
    (2) All reasonable attempts to obtain private resources (prisoner's 
family, friends, etc.) have failed, or such resources do not exist;
    (3) There are medical indications that the emergency medical 
assistance is necessary to prevent, or attempt to prevent, the death of 
the prisoners, or failure to provide the serviced will cause permanent 
disablement.
    (b) Services covered. Funds, once approved, may be expended for:
    (1) Medical examination, when required;
    (2) Emergency treatment;
    (3) Non-elective surgery;
    (4) Medications and related medical supplies and equipment required 
on a routine basis to sustain life;
    (5) Preventive or protective medications and medical supplies and 
equipment (vaccinations, inoculations, etc.) required to combat epidemic 
conditions (general or intramural);
    (6) Childbirth attendance, including necessary medical care of 
newborn children; and
    (7) Within the consular district, transportation for the U.S. 
national and attendant(s) designated by incarcerating officials between 
the place of incarceration and the place(s) of treatment.
    (c) Consular responsibility. As soon as the consular officer is 
aware that a U.S. national prisoner in the consular district faces a 
medical crisis, the officer should take the following actions, setting 
forth the order or priority based on an evaluation of the facts 
received:
    (1) Make every effort to contact the ill or injured prisoner as soon 
as possible;
    (2) Take steps to obtain a professional medical diagnosis and 
prognosis of the ill or injured prisoner;
    (3) Determine as accurately as possible the estimated costs of 
recommended treatment or surgery;
    (4) Obtain the names and addreses of family or friends who might 
serve as a source of private funds for medical services, and attempt to 
obtain the necessary funds;

[[Page 261]]

    (5) Request the prisoner to execute a promissory note, since funds 
expended by the Department to cover medical services normally are on a 
reimbursable basis; and
    (6) Submit the above information, along with recommendations and 
evaluations, to the Department for approval and authorization.
    (d) Emergency expenditure authorization. When a medical emergency 
prohibits the delay inherent in contacting the Department and receiving 
authority to expend funds, the consular officer can expend up to an 
amount to be established by the Department without prior Departmental 
approval if:
    (1) Symptoms determine eligibility for emergency medical treatment; 
or
    (2) An immediate medical examination is warranted in order to verify 
the alleged abuse of a U.S. national prisoner by arresting or confining 
authorities; or
    (3) Immediate emergency medical treatment or surgery is necessary to 
prevent death or permanent disablement, and there is insufficient time 
to explore private funds or obtain Department approval; and
    (4) A promissory note already has been executed by the prisoner, or 
if the circumstances warrant, by the consular officer without recourse.



Sec. 71.11  Short-term full diet program.

    (a) Eligibility criteria. A prisoner is considered eligible for the 
short-term full diet program under the following general criteria:
    (1) The prisoner is to be or has been held in excess of one day in a 
holding jail or other facility;
    (2) Incarcerating officials do not provide the prisoner food, and 
food is not available from any other sources, including private funding 
from family or friends; and
    (3) If the funds exceed an amount to be established by the 
Department, the prisoner signs a promissory note for funds expended, 
since the assistance is on a normally reimbursable basis.
    (b) Consular responsibility. As soon as the consular officer is 
aware that a U.S. national is incarcerated in a facility wherein food is 
not routinely provided, the consular officer should:
    (1) Contact the prisoner in accordance with existing procedures;
    (2) Determine the normal cost of basic diet and best method of 
effecting payment;
    (3) Attempt to secure funds from private sources such as family or 
friends;
    (4) Because funds expended by the Department to cover the short-term 
full diet program normally are on a reimbursable basis, have the 
prisoner execute a promissory note; and
    (5) Contact the Department, providing the above information, for 
approval and authorization.
    (c) Emergency expenditure authorization. Since an immediate need for 
a short-term full diet program often prohibits the delay inherent in 
contacting the Department and receiving authority to expend funds, the 
consular officer can expend up to an amount to be established by the 
Department without prior Departmental approval if the prisoner's case 
meets the criteria established in paragraph (a) of this section. 
Expenditures above the predetermined limit must receive the prior 
approval of the Department.



Sec. 71.12  Dietary supplements.

    (a) Eligibility criteria. A prisoner is considered eligible for the 
dietary supplement program under the following general criteria:
    (1) An evaluation by a priviate physician, prison doctor, or other 
host country medical authority reveals that the prison diet does not 
meet the minimum requriements to sustain adequate health; or
    (2) If the evaluation in paragraph (a)(1) of this section is not 
available, an evaluation by either a regional medical officer or 
Departmental medical officer reveals that the prison diet does not 
provide the minimum requirements to sustain adequate health.
    (b) Consular responsibility. (1) When the consular officer is aware 
that the U.S. prisoner's diet does not provide the minimum requirements 
to sustain adequate health, the consular officer shall obtain the 
necessary dietary supplements and distribute them to the prisoner on a 
regular basis.
    (2) As soon as the consular officer believes that dietary 
supplements are being misused, the consular officer

[[Page 262]]

shall suspend provision of the dietary supplements and report the 
incident in full to the Department.



PART 72--DEATHS AND ESTATES--Table of Contents




               Reporting Deaths of United States Citizens

Sec.
72.1  Consular responsibility.
72.2  Exceptions to consular responsibility.
72.3  Telegraphic notifications of death.
72.4  Normal reporting procedure.
72.5  Reports of presumptive deaths.
72.6  Reports of deaths on the high seas.
72.7  Reports on deceased persons believed to be United States citizens.
72.8  Disposition of nationality documents.

                         Disposition of Remains

72.9  Consular responsibility.
72.10  Local burial.
72.11  Cremation.
72.12  Shipment of remains to the United States.
72.13  Remains requiring special handling.
72.14  Fees for disposing remains.

                  Personal Estates of Deceased Citizens

72.15  Statutory responsibility of consular officer.
72.16  Regulatory responsibility of consular officer.
72.17  Responsibility of consular agents.
72.18  Responsibility if legal representative is present.
72.19  Responsibility if trustee for personal estate is present.
72.20  Responsibility if ``partner in trade'' is present.
72.21  Responsibility if will intended to operate locally exists.
72.22  Responsibility if will intended to operate in the United States 
          exists.
72.23  Responsibility in case of Department of Defense personnel.
72.24  Responsibility in case of Coast Guard personnel.
72.25  Responsibility in case of citizens dying on the high seas.
72.26  Responsibility in case of seamen.
72.27  Responsibility in case of Foreign Service personnel.
72.28  Effects to be taken into possession.
72.29  Nominal possessions; property not normally taken into possession.
72.30  Bank deposits in foreign countries.
72.31  Action when immediate possession is impracticable.
72.32  Action when property is in other consular districts.
72.33  Official notification to legal representative.
72.34  [Reserved]
72.35  Procedure for inventorying and appraising effects.
72.36  Preparation and disposition of inventory.
72.37  Disposal of perishable property.
72.38  Collection of debts due deceased.
72.39  Payment of debts owed by deceased.
72.40  Consular officer not to act as administrator of estate.
72.41  Consular officer not to perform legal services or to employ 
          counsel.
72.42  Consular officer not to assume financial responsibility.
72.43  Conditions under which estate can be released by consular 
          officer.
72.44  Evidence of claimant's right to estate.
72.45  Shipment of personnel estate to the United States.
72.46  Consular action on disagreements between claimants.
72.47  Consular action on unproved claim to estate.
72.48  Consular action on unclaimed estates.
72.49  Disposition of estate upon departure of responsible officer.
72.50  Final statement of account.
72.51  Preparation and disposition of final statement of account.
72.52  Fee services.
72.53  No-fee services.
72.54  Estates of Government personnel exempt from fee assessments.
72.55  Estates of citizens dying on the high seas exempt from fee 
          assessments.

    Authority:  R.S. 1709, as amended, sec. 302, 60 Stat. 1001; 22 
U.S.C. 1175, 842.

    Source:  22 FR 10841, Dec. 27, 1957, unless otherwise noted.

               Reporting Deaths of United States Citizens



Sec. 72.1  Consular responsibility.

    (a) A consular officer (or in his absence a diplomatic officer) is 
responsible for reporting to the Department, to the legal 
representative, and to the closest known relative the deaths of all 
United States citizens occurring in his consular district except as 
otherwise provided in Sec. 72.2. In order that he may be informed of 
such deaths, the consular officer should enlist the cooperation and 
assistance of the local authorities and the members of the American 
community.
    (b) A consular agent is not authorized to report the deaths of 
United States citizens to the Department, to the legal representative 
and to the closest known relative. The consular agent should, however, 
immediately report the circumstances of the death to his principal 
consular officer, who then

[[Page 263]]

has the responsibility for reporting in the manner prescribed in this 
section through Sec. 72.8.



Sec. 72.2  Exceptions to consular responsibility.

    (a) Department of Defense personnel. The Department of Defense is 
required to report officially the deaths of its military and civilian 
personnel. However, if no representative of the Department of Defense is 
present in the consular district where the death occurs, the consular 
officer should inform the Mission in the country to which he is assigned 
regarding the circumstances, for action by the appropriate attache. In 
colonial or trustee areas, or in countries in which no Defense 
Department attaches are assigned, the consular officer should telegraph 
the particulars of the death to the Department of State, indicating the 
maximum length of time before local burial is mandatory, for action by 
the Department of Defense. All inquiries concerning the death of any 
person falling within this category should be referred to the Department 
of Defense, Washington, DC 20301. Instructions in this paragraph do not 
apply to reporting the deaths of dependents of Department of Defense 
personnel or to reporting the deaths of contractor personnel, i.e., 
United States civilians employed in foreign countries by commercial 
concerns operating under contract with the Department of Defense, or 
their dependents. The deaths of such persons should be reported in the 
manner prescribed in Sec. 72.4
    (b) Coast Guard personnel. The United States Coast Guard is required 
to report officially the deaths of its military and civilian personnel. 
If death occurs in any country in Europe or the British Isles in which a 
Coast Guard detail is not assigned, the consular officer should inform 
the Senior Coast Guard Merchant Marine Detail Officer (Europe), London, 
England, by telegraph. If the death occurs outside Europe or the British 
Isles, the consular officer should telegraph the particulars of the 
death to the Department of State, indicating the maximum length of time 
before local burial is mandatory, for action by the Coast Guard. All 
inquiries concerning the death of Coast Guard personnel should be 
referred to the Commandant, United States Coast Guard, Washington, DC 
20226. The instructions in this section do not apply to reporting the 
deaths of dependents of Coast Guard personnel. The deaths of such 
persons should be reported in the manner prescribed in Sec. 72.4.



Sec. 72.3  Telegraphic notifications of death.

    (a) Use of telegraph. When instructions must be obtained from the 
next of kin or other interested person in the United States as to 
disposition of the remains, notification of death should be sent by 
telegraph to the Department for forwarding. If available to the consular 
officer, the name and address of the next of kin or legal representative 
(Sec. 72.18) should be included in the message. Consular officers at 
posts in Canada and Mexico whose consular districts are contiguous to 
the United States may, in their discretion, communicate directly by 
telegraph with next of kin or legal representative, requesting 
instructions for disposition of the remains.
    (b) Content of notification. All such notifications should state the 
minimum cost of
    (1) Local burial;
    (2) Cremation (if applicable);
    (3) Embalming, preparing and shipping the remains; and
    (4) The maximum period of time before local burial is mandatory.
    (c) Payment of charges. The cost of these initial notifications of 
death by telegraph is a proper charge against offical funds. Subsequent 
telegrams relating to matters for personal decision are normally at the 
expense of interested parties.
[22 FR 10841, Dec. 27, 1957, as amended at 30 FR 4412, Apr. 6, 1965]



Sec. 72.4  Normal reporting procedure.

    (a) Purpose and use of Form FS-192. Form FS-192, ``Report of the 
Death of an American Citizen'', is an administrative report established 
for the purpose of providing essential facts concerning the death of a 
United States citizen, and should be used to report the death officially 
to the Department, to the legal representative, and to the closest known 
relative of the deceased.

[[Page 264]]

Notification of death by telegraph does not eliminate the necessity for 
reporting the death on Form FS-192.
    (b) Information required on Form FS-192. All information called for 
under the various headings of Form FS-192 should be supplied in as much 
detail as possible. When prolonged delay is experienced in procuring 
full data, the consular officer should prepare and distribute a 
preliminary report of death on Form FS-192, marking the report 
``Preliminary.'' This should be followed by a final and complete report 
as soon as full data are available. Expanded comments necessary to cover 
special circumstances concerning the death, should appear under the 
heading ``Remarks.'' When applicable, statements concerning the 
following subjects should also appear under the heading ``Remarks'':
    (1) Disposition made of the passport and certificate of 
naturalization (see Sec. 72.8);
    (2) If the deceased is known to have been the recipient of 
continuing payments other than salary from the Federal Government (e.g., 
retirement, social security, disability compensation, or veterans 
insurance or benefits), indication of the nature of the Payments 
received;
    (3) If the deceased is a Selective Service registrant of inductible 
age, his Selective Service registration number and the number and 
address of his Local Board, when known.
    (c) Signing and sealing of Form FS-192. All copies of the Form FS-
192 should be signed by the consular officer with his name and official 
title typed below, and the consular impression seal should be impressed 
on each copy.
    (d) Transmission of Form FS-192 to the Department. The original of 
Form FS-192 shall be sent to the Department, plus one additional copy 
for each agency concerned, if the deceased was:
    (1) A recipient of continuing payments other than salary from the 
Federal Government; or
    (2) An officer or employee of the Federal Government (other than 
Department of Defense or Coast Guard); or
    (3) A Selective Service registrant of inductible age.
    (e) Transmission of form to legal representative and next of kin. A 
copy of Form FS-192 should be sent to the legal representative. A copy 
should also be sent to the closest known relative of the deceased (or 
relatives, if there are two or more persons having equal interests). No 
fee is prescribed for sending one copy each of completed Form FS-192 to 
the legal representative and to the closest known relative or relatives.
    (f) Transmission of form to other consular districts. In the event 
that a part of the personal estate of the decedent is known to be in a 
consular district other than that in which the death occurs (see 
Sec. 72.32), a copy of Form FS-192 should be sent to the consular 
officer in the other district.
    (g) Supplying copies of form. Copies of Form FS-192 shall be 
supplied by the Department of State or by the Foreign Service post upon 
request to any person having valid need therefor. Charges are as 
prescribed in the Schedule of Fees (Sec. 21.1 of this chapter) or in the 
Tariff of Fees, Foreign Service of the United States of America 
(Sec. 22.1 of this chapter).



Sec. 72.5  Reports of presumptive deaths.

    (a) Provisional report. Upon the receipt of evidence that a United 
States citizen is missing and is presumed to be dead, a report should be 
submitted to the Department on Form FS-192, with the title amended to 
read ``Report of the Presumptive Death of an American Citizen.'' A 
statement should be inserted in the form under the heading ``Cause of 
Death'' such as the following: ``Reported missing, believed to be 
dead'', giving the source of the information upon which the presumption 
is based. A statement should also be included under the heading 
``Remarks'' showing the requirements of local law for the establishment 
of legal presumption of the death of missing persons; i.e., whether 
under local law the legal presumption of death automatically arises at 
the expiration of a stipulated lapse of time, or whether formal action 
is necessary to obtain legal confirmation of the death of missing 
persons.
    (b) Final report. In the event that the fact of death is 
established, a final complete report shall be submitted to the 
Department on Form FS-192

[[Page 265]]

marked ``Final Report,'' in which reference shall be made, under the 
heading ``Remarks'', to the provisional report. If feasible, a ``Final 
Report'' should be sumbitted at such time as legal presumption of death 
arises in accordance with local law.



Sec. 72.6  Reports of deaths on the high seas.

    (a) On vessels of United States registry. When a United States 
citizen (not a seaman) dies on board a vessel of the United States 
making a voyage from a port in the United States to any foreign port, 
the master of the vessel is required to enter the circumstances of the 
death in the official log book (46 U.S.C. 201). Customarily, these 
circumstances are reported to the consular officer at the first port of 
call. On the basis of the log entry, the consular officer should report 
the death on Form FS-192 in the manner prescribed for other United 
States citizens (see Sec. 72.4). A copy of the text of the log entry, 
certified by the master, should be retained with the office copy of Form 
FS-192.
    (b) On vessels of foreign registry. When a United States citizen 
dies on a vessel of foreign registry, all information obtained from the 
master of the vessel for purposes of reporting the death on Form FS-192, 
should be supported by a certified copy of the text of the log entry, if 
obtainable.



Sec. 72.7  Reports on deceased persons believed to be United States citizens.

    (a) Verification of citizenship. As Form FS-192 may be accepted in 
courts of law, or considered elsewhere, as evidence of United States 
citizenship at the time of death, the consular officer should consult 
the regulations describing the evidence of citizenship which is 
acceptable for passport and registration purposes and should exercise 
due care in determining the citizenship status of the deceased. In 
doubtful cases he should transmit the Form FS-192 to the Department 
under cover of a despatch stating that the citizenship of the deceased 
has not been verified. The Department will then determine whether Form 
FS-192 may be released to the legal representative, next of kin, or 
other interested person, and will inform the consular officer of 
whatever action is taken.
    (b) Presumptions as to citizenship status. When the deceased was not 
currently documented at a Foreign Service office as a United States 
citizen, it must be assumed that, if the deceased was--
    (1) A native citizen, he had retained United States citizenship at 
the time of death, in the absence of evidence of an affirmative act of 
expatriation under paragraph 1, section 2 of the act of March 2, 1907, 
section 401 of the Nationality Act of 1940, or section 340 or 350 of the 
Immigration and Nationality Act;
    (2) A naturalized citizen, he had retained United States citizenship 
at the time of death, in the absence of evidence that he had lost 
nationality of the United States by having a continuous residence for 
three years in the territory of a foreign state as provided in section 
352(a)(1) of the Immigration and Nationality Act, or by having a 
continuous residence for five years in any other foreign state or states 
as provided in section 352(a)(2) of the same act, unless there is 
evidence that his case comes within one of the exceptions established 
under section 353 or 354 of the act. Nationality may also have been lost 
under similar provisions contained in section 404 of the Nationality Act 
of 1940. The term residence as used herein means the place of general 
abode, and residence shall be considered continuous for the purpose of 
sections 350 and 352(a) (1) and (2) of the act where there is a 
continuity of stay but not necessarily an uninterrupted physical 
presence in a foreign state or states or outside the United States.



Sec. 72.8  Disposition of nationality documents.

    (a) Passport. The passport of a deceased United States citizen 
should be canceled by the consular officer and either returned to the 
Department or delivered to the person having a legitimate interest 
therein. Only a person who is included in the passport may be considered 
to have a legitimate interest in it. The date and place of death should 
be noted on the passport, and an appropriate notation made on Form FS-
192 (see Sec. 72.4(b)(1)).

[[Page 266]]

    (b) Certificate of naturalization. The certificate of naturalization 
of a deceased United States citizen should be taken up by the consular 
officer and forwarded to the Department for transmission to the 
Department of Justice; or, if the certificate is claimed by any person 
who may have a legitimate interest therein, it should be endorsed by the 
consular officer to show the date and place of death of the person to 
whom it was originally issued, and should then be delivered to the 
person entitled thereto, with appropriate notation made on Form FS-192 
(see Sec. 72.4(b)(1)).

                         Disposition of Remains



Sec. 72.9  Consular responsibility.

    (a) In the absence of relatives or other interested persons, the 
consular officer should exert all reasonable effort to carry out the 
expressed wishes of the deceased or next of kin as to local burial, 
cremation, or shipment of the remains, taking care that the legal 
requirements of the country are met. However, the consular officer is 
neither authorized nor expected to assume any financial responsibility 
for, or to incur any expense in connection with, the disposition of the 
remains of deceased persons unless specifically instructed to do so by 
the Department. When the next of kin or other interested person cannot 
be reached within the period provided by local law for the interment or 
preservation of dead bodies and sufficient funds can be realized from 
the personal estate of the deceased in the consular officer's 
possession, he should arrange for disposal of the reamins locally and 
draw funds from the estate to cover the costs (see Sec. 72.39; also 
Sec. 72.20 as regards withdrawals from bank accounts). If there are not 
sufficient funds in the estate to cover the costs, and funds are 
unobtainable from relatives or other interested persons, there may be no 
alternative but to accept disposal of the remains by the local 
authorities in accordance with local law or regulations. (See also 
Sec. 72.13 for remains requiring special handling.)
    (b) A consular agent may, upon instructions from his principal 
consular officer, arrange for the disposition of remains of deceased 
United States citizens. His principal consular officer has, in 
accordance with this section to Sec. 72.14, the responsibility for 
reporting to relatives and for complying with the laws of the country in 
which the death occurred as well as the requirements of the United 
States.



Sec. 72.10  Local burial.

    (a) Arrangements for funerals. When the responsibility for local 
burial falls on the consular officer (see Sec. 72.9), he should endeavor 
to carry out the expressed instructions of the deceased or, in the 
absence of such instructions, the wishes of the next of kin. Funeral 
services should be conducted in accordance with the rites of the 
religious faith of the deceased, if known. In each instance the consular 
officer should notify known friends of the deceased and other interested 
persons in the consular district (such as any American community 
organizations) of the date and place of the funeral. When practicable, 
the services should be attended by a member of the consular staff.
    (b) Report to relatives. The next of kin, or other person whose 
wishes have been considered in making the arrangements for local burial, 
should be informed by letter of any funeral service that is held.
    (c) Erection of markers. If the consular officer is requested to 
make arrangements for the erection of markers on graves, he may assist 
to the extent of ascertaining any feasible procedure for making local 
arrangements and effecting direct remittance for this purpose, and 
informing the interested party accordingly.
    (d) Upkeep of graves. The maintenance and repair of graves of 
persons whose remains are interred abroad, including officers and 
employees of the Foreign Service, is not a proper charge against 
official funds unless specifically authorized. If the consular officer 
is requested to make arrangements for the upkeep of graves, he may 
assist to the extent indicated in paragraph (c) of this section with 
respect to the erection of markers.



Sec. 72.11  Cremation.

    (a) Arrangements. When cremation is desired, and the facilities are 
available,

[[Page 267]]

the consular officer should see that all necessary arrangements are made 
if compatible with the requirements of the country in which the death 
occurred, having in mind particularly such local laws as may prohibit 
cremation unless specific request for such disposition was made in 
writing by the individual prior to death.
    (b) Disposition of ashes. Disposition of the ashes should be made in 
accordance with the expressed wishes of the deceased or the next of kin, 
or other interested person. If shipment to the United States is desired, 
only local health requirements must be met, as there are no sanitary 
requirements for entry of ashes into the United States. A marking should 
be made on, or a marker firmly affixed to, the container in which the 
ashes are shipped. The latter should be accompanied by--
    (1) An offical death certificate;
    (2) Cremation certificate;
    (3) Certificate from the crematorium stating that the container 
holds only the cremated remains of the deceased; and
    (4) A permit to export (if required locally).



Sec. 72.12  Shipment of remains to the United States.

    (a) Arrangements. Whenever the remains of persons who have died 
abroad, regardless of the nationality of the deceased, are to be shipped 
to the United States, the consular officer should assure himself that 
they are properly encased and accompanied by all necessary papers 
pertaining to the death, exhumation (if applicable) and preparation for 
shipment. The requirements of the country where the death occurred must 
be met at all times.
    (b) Local documents accompanying remains. The following documents 
should accompany the remains for shipment, attached to the consular 
mortuary certificate (see paragraph (d) of this section):
    (1) A certificate of death issued by the local registrar of deaths, 
or similar authority, identifying the remains, showing the place, date 
and cause of death as certified by the attending physician, with a 
listing of the cause of death conforming as far as practicable with the 
terminology of the International List of Causes of Death (needed to 
comply with United States Quarantine and interstate requirements);
    (2) The affidavit described in paragraph (c) of this section (for 
United States Customs), which also would generally include evidence of 
embalming, when applicable (needed to comply with the requirments for 
interstate shipment);
    (3) A ``transit permit'' authorizing export of the body out of the 
country, issued by the health authority at the port of embarkation, 
stating the date of its issuance, name of deceased, sex, race, age, 
cause and date of death (needed to comply with New York health 
requirements).
    (c) Packing and labeling of casket. In order to facilitate clearance 
through United States Customs at the port of entry, the undertaker, or 
whatever person is responsible for packing the body for shipment, should 
be required to make a sworn declaration--to be attached to the consular 
mortuary certificate (see paragraph (d) of this section)--that the 
casket or box contains only the body of the deceased and the necessary 
clothing and packing. The sworn declaration should be made, if 
practicable, before the consular officer; if not, it should be made 
before a qualified local official, whose signature and seal can be 
authenticated by the consular officer. The outer box should be labeled 
in conformity with port of entry health requirements.
    (d) Consular mortuary certificate. A consular mortuary certificate 
should be prepared indicating how the case is marked and addressed, 
means of transportation to the United States, name of carrier, date and 
place of shipment, port of entry and scheduled time of arrival. The 
documents listed in paragraph (b) of this section should be ribboned to 
the consular mortuary certificate, which should be signed by the 
consular officer and sealed with the consular press seal.



Sec. 72.13  Remains requiring special handling.

    (a) Foreign Service personnel. In the absence of relatives or other 
interested persons, the consular officer should make all necessary 
arrangements for

[[Page 268]]

the disposition of the remains of deceased officers and employees of the 
Foreign Service according to specific instructions from the Department.
    (b) Personnel of other Government agencies. The consular officer 
should extend to other departments or agencies of the United States 
Government all appropriate aid, in accordance with specific instructions 
received through the Department of State for the disposition of the 
remains of an employee who has died while serving in a foreign country.



Sec. 72.14  Fees for disposing remains.

    No fees are prescribed for services in connection with the 
disposition of remains of United States citizens or nationals. Fees for 
such services with respect to the remains of foreign nationals are as 
prescribed in the Schedule of Fees, 22 CFR 22.1.
[63 FR 6480, Feb. 9, 1998]

                  Personal Estates of Deceased Citizens



Sec. 72.15  Statutory responsibility of consular officer.

    Sections 1175-1179 of title 22 of the United States Code prescribe 
the statutory responsibility of officers of the United States Foreign 
Service for the personal estates of deceased United States citizens 
dying outside the United States.



Sec. 72.16  Regulatory responsibility of consular officer.

    Except as otherwise provided in Secs. 72.18 through 72.26, the 
consular officer (or in his absence a dipomatic officer) should take 
possession and dispose of the personal estates (other than the articles 
described in Secs. 72.29 and 72.30) of all United States citizens who 
die within his jurisdiction or were residing therein at the time of 
death. This responsibility should be discharged in accordance with the 
procedure prescribed herein so far as that procedure is authorized by:
    (a) Treaty provisions; or
    (b) The laws or authorities of the country wherein the estate is 
located; or
    (c) Established usage.



Sec. 72.17  Responsibility of consular agents.

    A consular agent has no statutory authority to take possession and 
dispose of the personal estate of a deceased citizen of the United 
States, except under the immediate supervision and as the agent of his 
principal consular officer. The consular agent, therefore, should 
immediately report the circumstances to, and request instructions from, 
his principal consular officer, who should assume the responsibility for 
taking possession and disposing of the personal estate in accordance 
with the regulations in this part.



Sec. 72.18  Responsibility if legal representative is present.

    According to law (22 U.S.C. 1175), the consular officer should not 
take possession or dispose of the personal estate of a deceased citizen 
who has left a legal representative in the country where the death 
occurred or in the country where he was residing at the time of death. 
As used here, the term ``legal representative'' means--
    (a) An executor designated by will or testament;
    (b) An administrator appointed in interstate proceedings;
    (c) An agent of executor or administrator qualifying by power of 
attorney;
    (d) A child of legal age;
    (e) A parent;
    (f) The next of kind (nearest blood relative);
    (g) The surviving spouse.



Sec. 72.19  Responsibility if trustee for personal estate is present.

    Likewise, the law (22 U.S.C. 1175) stipulates that the consular 
officer should not take possession or dispose of the personal estate of 
a deceased citizen who has left in the country where the death occurred, 
or in which he was residing at the time of death, a ``trustee by him 
appointed.'' The language of the statute includes any person, natural or 
juristic, appointed by the decedent in a will, or appointed by a deed to 
hold legal title to the personal property for the benefit of a named 
beneficiary.

[[Page 269]]



Sec. 72.20  Responsibility if ``partner in trade'' is present.

    Although the law (22 U.S.C. 1175) also relieves the consular officer 
of responsibility if a ``partner in trade'' is present, the death of one 
member of a partnership automatically dissolves this relationship. 
Consequently, the surviving partner or partners have no beneficial 
interest as ``partners in trade'' in the personal estate of the 
deceased. The duties and responsibilities of provisional conservator of 
the personal estate of the deceased cannot therefore be assumed by a 
surviving partner, unless he is duly authorized to act as a legal 
representative of the deceased. Accordingly, the presence of a former 
``partner in trade'' will not necessarily relieve the consular officer 
of his responsibility.



Sec. 72.21  Responsibility if will intended to operate locally exists.

    If a will is discovered which is intended to operate locally, and a 
local or domiciliary representative named by the decedent qualifies 
promptly and takes charge of the personal estate, the consular officer 
should assume no responsibility for the estate (Secs. 72.18 and 72.19), 
and should not take possession, inventory and dispose of the personal 
property and effects or in any way serve as agent for the local or 
domiciliary representative. However, if the laws of the country permit 
and if the local or domicillary representative does not qualify 
promptly, the consular officer may have take protective action in the 
interest of the estate to the extent of placing his seal on the personal 
property and effects of the decedent, such seal to be broken or removed 
only at the request of the local or domiciliary representative. 
Furthermore, he should see that the foreign authorities accord due 
recognition to the American interests involved and provide proper 
protection for the property under local procedures. If prolonged delays 
are encountered by the local or domiciliary representative in making 
arrangements to take charge of the personal estate, the consular officer 
may request that the will be offered for probate, if in his judgement 
such action is advisable in the interest of the estate.



Sec. 72.22  Responsibility if will intended to operate in the United States exists.

    If a will that is intended to operate in the United States is found 
among the effects taken into possession by the consular officer, it 
should be forwarded immediately to the person or persons designated, in 
the event that their whereabouts are known. When this is impossible, the 
will should be sent to the appropriate court in the State of the 
decedent's domicile. Special directions contained in the will for the 
conservation by the consular officer of the personal estate should be 
observed by him so far as the laws of the foreign country and these 
regulations permit him to act.



Sec. 72.23  Responsibility in case of Department of Defense personnel.

    The Department of Defense is required, in the absence of a legal 
representative or other authorized person (see Secs. 72.18 and 72.19), 
to assume responsibility for the disposition of the personal estates of 
its military and civilian personnel who have died abroad. However, when 
no representative of the Department of Defense, or other authorized 
person, is present at the time of death, the consular officer should 
take possession of the personal estate and hold it for disposition in 
accordance with instructions from the Department of Defense. No fee 
should be charged for services so rendered (Sec. 72.54). Instructions in 
this section do not apply to the personal estates of dependents of 
Department of Defense personnel; nor to contractor personnel, i.e., 
United States civilians employed in foreign countries by commercial 
concerns operating under contract with the Department of Defense, and 
their dependents. The estates of such persons should be disposed of in 
the manner prescribed by Secs. 72.28 to 72.51, if no legal 
representative is present.



Sec. 72.24  Responsibility in case of Coast Guard personnel.

    The United States Coast Guard is required, in the absence of a legal 
representative or other authorized person (see Secs. 72.18 and 72.19), 
to assume responsibility for the disposition of the

[[Page 270]]

personal estates of its military and civilian personnel who have died 
abroad. However, when no representative of the Coast Guard, or other 
authorized person is present at the time of death, the consular officer 
should take possession of the personal estate and hold it for 
disposition in accordance with instructions from the Commandant, United 
States Coast Guard. No fees should be charged for services so rendered 
(Sec. 72.54). Instructions in this section do not apply to the personal 
estates of dependents of Coast Guard personnel. The estates of such 
persons should be disposed of in the manner prescribed by Secs. 72.28 to 
72.51, if no legal representative is present.



Sec. 72.25  Responsibility in case of citizens dying on the high seas.

    (a) Consular responsibility not provided by statute. There is no 
express provision of law authorizing the consular officer to take 
possession and dispose of the personal estate of a citizen of the United 
States (not a seaman) who has died on the high seas.
    (b) When death occurs on board vessel of United States registry. If 
the death occurred on board a vessel of the United States, the master of 
the vessel, in the absence of a legal representative or other authorized 
person (see Secs. 72.18 and 72.19), should be requested to take custody 
and return the personal estate to the shipping company in the United 
States for forwarding to the legal representative or other authorized 
person.
    (c) When death occurs on board vessel of foreign registry. Death on 
board a vessel of foreign registry is considered to have occurred in the 
territory of the country of the ship's registry, and the estate laws of 
that country are applicable in such cases. In the absence of a legal 
representative or other authorized person (see Secs. 72.18 and 72.19), 
the consular officer should take possession and dispose of the personal 
estate, provided that the laws of the country of assignment as well as 
the laws of the country of the ship's registry permit. The procedure in 
such cases is identical with that followed in the disposition of the 
estate of any United States citizen who may have died within the 
consular district, except that no fees should be charged for services 
rendered (Sec. 72.55).



Sec. 72.26  Responsibility in case of seamen.

    See Secs. 85.4 to 85.9 of this chapter for regulations regarding the 
disposition of the personal estates of seamen who have died while 
serving as members of the crew of a vessel of the United States. The 
consular officer should take possession and dispose of the personal 
estates of United States citizens who have died while serving as seamen 
on board foreign vessels, in the manner prescribed by Sec. 72.25(c).



Sec. 72.27  Responsibility in case of Foreign Service personnel.

    In the absence of a legal representative or other authorized person, 
the consular officer should take possession and dispose of the personal 
estates of deceased Foreign Service personnel in the manner prescribed 
by these regulations for other deceased citizens of the United States, 
except that no fee should be charged (Sec. 72.54). Travel orders issued 
by the Department for shipment of the personal effects of deceased 
officers and employees of the Foreign Service constitute only 
administrative authorization to transport the effects to a given 
destination, and in no way relieve the consular officer of the 
responsibility for satisfying himself of a claimant's right to the 
personal estate prior to shipment (Sec. 72.43).



Sec. 72.28  Effects to be taken into possession.

    Although no limitations are placed by law (22 U.S.C. 1175) on the 
nature and extent of the personal property that should be taken into 
possession by the consular officer in the absence of a legal 
representative, experience has shown that the need exists to delimit by 
regulation the consular officer's obligations, but not his authority, in 
this regard. For example, the consular officer would not normally be 
expected to take physical possession of the articles covered in 
Sec. 72.29 unless the items are of such nature and quantity as to be 
readily included with the personal effects of the nature described in 
this section, or unless such action, when physically possible, is 
necessary for the preservation or protection of the property. The 
consular officer does, however, have responsibility for taking

[[Page 271]]

reasonable steps to safeguard the articles of the personal estate which 
he does not take into possession until disposition can be effected by 
the legal representative. The personal effects which the consular 
officer would normally take into possession in any event include the 
following:
    (a) Convertible assets, consisting of currency, redeemable 
transportation tickets, evidences of debts due and payable in the 
country of the officer's assignment, and any other instruments 
negotiable by the consular officer;
    (b) Perishable property (including most foodstuffs), having 
commercial value;
    (c) Luggage;
    (d) Wearing apparel;
    (e) Miscellaneous personal effects;
    (f) Jewelry, heirlooms and articles of sentimental value;
    (g) Non-negotiable instruments, defined as any document or 
instrument not saleable or transferrable by the consular officer, but 
which requires either the signature of the decedent or action by, or 
endorsement of, his legal representative; and includes transportation 
tickets not redeemed or redeemable by the consular officer, traveler's 
checks, promissory notes, evidences of debts not due and payable in the 
country of the officer's assignment, stocks, bonds or other similar 
instruments, bank books, books showing deposits in building and loan 
associations, etc. No fee is charged on non-negotiable instruments taken 
into possession by the consular officer; see Sec. 72.53.
    (h) Personal documents and papers.



Sec. 72.29  Nominal possessions; property not normally taken into possession.

    (a) The taking of articles of personal property into nominal 
possession from local officials or other persons, for the explicit 
purpose of on-the-spot release to the ``legal representative'' as 
defined in Sec. 72.18 against the latter's memorandum receipt 
discharging the consular officer without further accounting of any 
responsibility for articles so transferred by him, shall not be 
construed as the taking of custody by the officer. No fee shall be 
charged for the consular officer's service in effecting transfer of the 
articles in the manner described, provided that he is not required to 
prepare a consular inventory, appraise the articles, or list the 
contents of containers, and provided further that the effects are not 
taken in safekeeping upon official accountability.
    (b) The consular officer is not normally expected to take physical 
possession, as provisional conservator, of livestock or of articles of 
personal property which may be found in residences and places of storage 
such as furniture, household effects and furnishings, bulky works of 
art, etc., unless the items are of such nature and quantity as to be 
readily included with the personal effects (Sec. 72.28), or unless such 
action, when physically possible, is necessary for the preservation or 
protection of the property, especially where the articles are of 
considerable intrinsic value; nor is the consular officer normally 
expected to take into physical possession motor vehicles, airplanes, or 
powered watercraft. Personal property not taken into possession should, 
however, be safeguarded by affixing the consular seal on the premises or 
on the property (whichever is appropriate), provided the laws of the 
country permit; or by taking reasonable steps to ensure that such items 
are placed in safekeeping (at the expense of the estate) until action 
can be taken by the legal representative. In order to protect the 
interests of the estate, the consular officer should prepare a list, in 
quintuplicate, of the articles not taken into physical custody, with 
indication of safeguarding measures taken, for submission with the 
inventory of effects which must be prepared for all items in his 
possession (see Sec. 72.53). If the property which normally would be 
sealed by the consular officer is not immediately accessible, he should 
consider requesting the local authorities to seal the premises, or the 
property, or otherwise ensure that the property remains intact until 
consular seals can be placed thereon or the property placed in safe 
storage, or until the legal representative assumes responsibility 
therefor.



Sec. 72.30  Bank deposits in foreign countries.

    The existence of bank deposits when known should be reported to the 
legal

[[Page 272]]

representative, or other authorized person, who should be informed of 
the general procedure required by local law to withdraw such deposits 
and whether legal counsel is advisable for that purpose. There is no 
express provision of law authorizing the consular officer to withdraw or 
otherwise dispose of bank deposits in foreign countries left by deceased 
United States citizens. Such deposits, therefore, are considered for the 
purpose of the regulations in this part as forming no part of the 
personal estate of a decedent, and no Foreign Service fees are 
chargeable thereon (Sec. 72.53(c)). In the event that the consular 
officer is requested by the legal representative of the estate to 
withdraw bank balances on his behalf in order to defray local expenses 
in connection with the death and the settlement of the personal estate 
of the decedent, he may comply with such request if facilities are 
provided by the depository for this purpose. Funds withdrawn should be 
limited to the amount necessary to defray the expenses prescribed 
herein, and fees should be collected on the amount withdrawn, in 
accordance with Sec. 72.52.



Sec. 72.31  Action when immediate possession is impracticable.

    The law imposes no affirmative obligation upon the consular officer 
to travel long distances for the purpose of taking on-the-spot 
possession of a personal estate. If occasion to visit the locality where 
the death occurred coincides with the need to take action, the consular 
officer should avail himself of the occasion to assume custody of the 
effects. Normally, however, the consular officer's initial 
responsibility in such cases does not extend beyond reasonable efforts 
to obtain possession of the estate. He should communicate with the 
persons, officials, or organizations having custody of the effects, 
requesting that the effects be delivered to him, at the expense of the 
estate, for lawful disposition. If the local authorities should decline 
to surrender possession to the consular officer in a case where he feels 
that his right to take possession is clear, he may refer the matter to 
the mission. The consular officer's personal responsibility for any 
given item among the personal effects commences only when that item 
reaches his hand.



Sec. 72.32  Action when property is in other consular districts.

    If any portion of the personal estate is known to be in another 
consular district, mention of this should be made under ``Remarks'' in 
the Form FS-192; and a copy of this form should be sent to the consular 
officer concerned (see Sec. 72.4(f)) who should assume responsibility 
independently for taking possession and disposing of these effects in 
the manner prescribed herein. If the cash resources of the personal 
estate found in one consular district are insufficient to pay the 
decedent's debts in that district or in the country of the consular 
officer's assignment (see Sec. 72.39), the funds found among the 
personal effects in the other consular district may be utilized to pay 
the decedent's debts in both districts or countries. In such cases, the 
consular officer who effects the transfer of the funds should enter the 
disbursement in his final statement of account (see Sec. 72.51), 
including the funds transferred in the gross amount of the estate in his 
possession, for the assessment of fees as indicated in Secs. 72.52 to 
72.55. The funds transferred should also appear in the final statement 
of account of the consular officer receiving them as ``receipts'' and 
``disbursements'', stating the source. However, no fee should be charged 
on the amount involved (see Sec. 72.53(b)).



Sec. 72.33  Official notification to legal representative.

    The preparation and forwarding of Form FS-192 complies with the law 
(22 U.S.C. 1176) as regards notification of death to the legal 
representative as well as to the Secretary of State. Failing by direct 
means to locate a legal representative, the consular officer may, if 
required in connection with the settlement of the estate, have recourse 
to giving public notice of the death in ``one of the gazettes'' (i.e. 
any suitable periodical) in the consular district.

[[Page 273]]



Sec. 72.34  [Reserved]



Sec. 72.35  Procedure for inventorying and appraising effects.

    After taking possession of the personal estate of a deceased 
citizen, the consular officer should immediately inventory and appraise 
the personal effects on the basis of the local market value, article by 
article, with the assistance of two other persons who should join him in 
signing the inventory and in certifying to the accuracy of of the 
appraised value of each article inventoried. The inventory should 
include only that part of the personal estate actually taken into 
possession by the consular officer, regardless of value and the fact 
that the death may have occurred in one consular district and a portion 
of the personal effects may be found in another consular jurisdiction. 
Care should be exercised not to over-estimate the value of the personal 
effects, which is the basis on which Foreign Service fees will be 
charged (Sec. 72.52). The consular officer may, in his discretion, call 
upon professional appraisers at the expense of the estate when warranted 
by the nature of the personal effects, i.e., expensive jewelry, furs, 
etc.



Sec. 72.36  Preparation and disposition of inventory.

    The inventory of effects should be prepared in quintuplicate. All 
copies should be signed by the consular officer and the two persons who 
assisted in its preparation, and they should be disposed of in the 
following manner:
    (a) The original retained in the office files;
    (b) Two copies, under cover of a despatch, sent to the Department 
(one copy for transmission to the General Accounting Office);
    (c) One copy to the legal representative (two copies if the next of 
kin is the legal representative); and
    (d) One copy to the next of kin.



Sec. 72.37  Disposal of perishable property.

    As soon as practicable after the consular officer takes possession, 
the perishable portion of the personal estate having commercial value 
(including most foodstuffs) should be sold at auction, i.e., to the most 
favorable bidder, unless the amount involved does not justify such 
expenditure. A newspaper advertisement, written or oral requests for 
bids from any interested party, or the services of a professional 
auctioneer, may all serve the purpose of insuring an impartial sale. 
When the value of the goods or circumstances do not justify such action, 
the consular officer may proceed directly with the sale of the goods.



Sec. 72.38  Collection of debts due deceased.

    The consular officer should endeavor to collect only those debts due 
the decedent from persons or concerns in the country in which the death 
occurred or in the country in which the decedent was residing at the 
time of death. Debts so collected are regarded as part of the decedent's 
personal estate, and should be included in the gross amount thereof for 
the assessment of fees (Sec. 72.52).



Sec. 72.39  Payment of debts owed by deceased.

    (a) When cash resources suffice. The decedent's debts which the 
consular officer is reasonably certain are legitimately owed in the 
country in which the death occurred, or in the country in which he was 
residing at the time of death, including expenses incident to the 
disposition of the remains and the personal effects, should be paid out 
of the cash resources of the personal estate taken into possession by 
the consular officer; namely, money found among the personal effects, 
proceeds of the sale of the perishable property, or funds received 
through the collection of debts owed the decedent. See Sec. 72.32 in 
regard to the personal estate in another consular district. Any doubtful 
claim against the estate should be referred to the legal representative 
or other authorized person for consideration; a claim for damages for a 
negligent or wrongful act of the decedent is not a debt to be paid by 
the consular officer unless it has been reduced to judgment.
    (b) When cash resources are insufficient. In the event that the cash 
resources of the personal estate are not sufficient to pay the debts 
owing in the

[[Page 274]]

country in which the death occurred, or in the country in which the 
decedent was residing at the time of death, the consular officer should 
endeavor to obtain sufficient funds from the legal representative, next 
of kin or other interested person. See Sec. 72.32 concerning funds found 
in another consular district. Fees are not charged on funds so furnished 
(Sec. 72.53). If sufficient funds cannot be assembled from the foregoing 
sources, the consular officer should sell at auction (see Sec. 72.37), 
such portion of the personal estate as may be necessary to pay the debts 
and expenses. Should occasion arise for sale of motor vehicles, 
airplanes or powered watercraft, title to which and liens upon which in 
the United States and almost universally are matters of official record, 
care should be taken to conform with applicable registration 
requirements. Articles which are most marketable, and at the same time 
least likely to be desired by the heirs of the decedent, should be sold 
first. Jewelry, heirlooms and articles which may have sentimental value 
to relatives, regardless of intrinsic value, should be sold only in case 
of necessity, and in the order named. Members of the decedent's family 
should be notified of the necessity for the sale, if practicable, in 
order that they may purchase these articles if they desire. Proceeds 
from the sale are regarded as forming part of the personal estate and 
should be included in the gross amount thereof for the assessment of 
Foreign Service fees (see Sec. 72.52).



Sec. 72.40  Consular officer not to act as administrator of estate.

    The consular officer normally should not accept appointment from any 
foreign state or from a court in the United States to act as 
administrator, or to assist (except as provisional conservator) in 
administering the personal estate of a deceased citizen who has died, or 
was residing at the time of death, within his consular district. Neither 
should he accept appointment as guardian or in any other fiduciary 
capacity in the settlement of the estate without:
    (a) Having previously obtained the permission of the Secretary of 
State to accept such appointment; and
    (b) Having assured himself that he has authority so to act under 
treaty provisions, local law or usage.

If authorization is received as to appointment in any of the capacities 
indicated above, the consular officer will be required to execute bond, 
with surety to be approved by the Secretary of State (22 U.S.C. 1178, 
1179).



Sec. 72.41  Consular officer not to perform legal services or to employ counsel.

    Owing to the legal restriction against engaging in foreign business 
or professional activity (22 U.S.C. 805), the consular officer shall not 
act as attorney or agent for the estate. Neither shall he employ counsel 
at the expense of the United States Government, or the estate, in 
collecting and disposing of the personal estate of a deceased citizen. 
If legal assistance is requested of the consular officer, he may furnish 
the names of several attorneys or inform the inquirer as to sources 
through which the names of suitable attorneys may be obtained.



Sec. 72.42  Consular officer not to assume financial responsibility.

    The consular officer, as provisional conservator of the personal 
estate of a deceased citizen, is neither authorized nor expected to 
assume any financial responsibility, not to incur any expense in behalf 
of the estate, in excess of funds available for that purpose (see 
Sec. 72.39(a)).



Sec. 72.43  Conditions under which estate can be released by consular officer.

    The consular officer is responsible to the United States court 
having probate jurisdiction over the estate and to the parties in 
interest for the personal estate in his possession. He must be prepared 
to deliver the estate to, or otherwise dispose of it according to the 
wishes of, the legal representative of the decedent upon the 
presentation of satisfactory evidence of the latter's right to receive 
the estate, and upon the payment of the prescribed Foreign Service fees 
(Sec. 72.52). Determination of what constitutes satisfactory evidence of 
a claimant's right to the personal estate of a deceased citizen is also 
the responsibility of the consular officer. The

[[Page 275]]

consular officer, therefore, must satisfy himself that the evidence 
which he accepts is sufficient to relieve him as provisional 
conservator. Friends, traveling companions, employers, and business 
associates are not competent to relieve the consular officer of the 
duties and responsibilities enumerated in the regulations in this part, 
unless duly authorized as legal representatives of the estate (see 
Sec. 72.18). Satisfactory evidence of a claimant's right to the personal 
estate of a decedent may be supplied in the manner indicated in 
Sec. 72.44.



Sec. 72.44  Evidence of claimant's right to estate.

    (a) Letters testamentary. A certified copy of the letters 
testamentary (an instrument issued by a court of law under which a 
person, named as executor by a will, formally takes charge of the estate 
and proceeds to carry out the directions in the will) is prima-facie 
evidence of the executor's right to take possession of the personal 
estate.
    (b) Letters of administration. A certified copy of the letters of 
administration (an instrument issued by a court of law in intestate 
proceedings appointing an administrator to take charge of the property 
of a decedent) is prima-facie evidence of the administrator's right to 
take possession of the personal estate.
    (c) Affidavit of next of kin. When a decedent dies intestate, and 
the personal estate consists only of clothing and similiar personal 
effects appraised at little or no commercial value, or in cases where 
the consular officer is fully satisfied of the legal right of the 
claimant and the value of the estate does not warrant the expense of 
probate proceedings, he may be justified in considering as satisfactory 
evidence an affidavit executed by the decedent's next of kin. The 
affidavit of the next of kin should be corroborated by the sworn 
statements of two persons acquainted with the affiant and familiar with 
the facts of the case. In any event, the consular officer must satisfy 
himself of the legal right of the claimant or claimants to the 
decedent's effects before releasing the property that he has in his 
possession, and he must decide whether an affidavit is acceptable in 
lieu of a certified copy of the letters testamentary or the letters of 
administration.



Sec. 72.45  Shipment of personal estate to the United States.

    (a) When the consular officer is requested to ship to the United 
States the personal estate in his possession, he should deliver it to a 
forwarding company selected by the legal representative. Clearance by 
Customs in the United States will be facilitated if the personal estate 
is accompanied by a consular certificate identifying it and indicating 
its nature. If the entire shipment is covered by a single bill of 
lading, a certificate attached to the original bill of lading covering 
the shipment would be sufficient; otherwise a certificate should 
accompany each parcel, box or case.
    (b) Extra copies of the bill of lading can serve as a receipt from 
the forwarding company, one copy to be attached to the consular 
officer's final statement of account (Sec. 72.50), and one copy to be 
retained in the office files. If shipment by registered or insured 
parcel post, or by other safe means covered by receipt, is possible, 
there is no objection to forwarding the estate in this fashion, and 
postal or other receipts should be disposed of in the manner described 
above, with the original attached to the final statement of account. The 
personal effects of Foreign Service personnel (see Sec. 72.27) and of 
personnel of other Government agencies (except Department of Defense and 
Coast Guard personnel) should be consigned to the United States despatch 
agent at the port of entry, for forwarding to the legal representative.



Sec. 72.46  Consular action on disagreements between claimants.

    If rival claimants or administrators (administrators may be 
appointed in different jurisdictions) demand the personal estate in the 
consular officer's possession, he should refuse to deliver the estate 
until an agreement has been reached, or judgment rendered, as to which 
claimant or administrator should receive it, and the consular officer so 
informed in writing. If, after one year, agreement has not been reached

[[Page 276]]

between rival claimants, or judgment rendered, the consular officer 
should notify all parties concerned and sell the entire personal estate 
at auction in the manner prescribed by Sec. 72.37, with the exception of 
jewelry, heirlooms, and articles which may have sentimental value to 
relatives, regardless of intrinsic value. Should any of the personal 
property not have been taken into physical possession previously (see 
Sec. 72.29), the consular officer should take possession of such 
property and, after preparing a supplementary inventory in the manner 
prescribed in Secs. 72.35 and 72.36, include this portion of the estate 
with that already in his possession. The proceeds of the sale should be 
converted into United States dollars and after payment of local debts 
(Sec. 72.39) and collection of the fee prescribed by Sec. 72.52, should 
be transmitted, with any unsold portion of the estate in the consular 
officer's possession, to the Department of State for forwarding to the 
General Accounting Office for safekeeping and lawful disposition as 
conservator of the estate (22 U.S.C. 1175).



Sec. 72.47  Consular action on unproved claim to estate.

    If the evidence of a claimant's right to receive the estate is not 
considered sufficient to relieve the consular officer of his 
responsibility as provisional conservator, he may elect a period of 
time, not less than one year from the date of the decedent's death, 
within which settlement must be effected, in order to obviate 
interminable delay in disposing of the estate. In the consular officer's 
discretion, he may before releasing the estate, require the claimant to 
give bond in an amount fixed by the officer himself to run for such 
period of time as he may designate, in order to protect himself against 
other possible claims against the estate. If claim to the estate is 
still unproved at the expiration of the period set, or the claimant 
refuses to meet the conditions of any bond which the consular officer 
may require, the consular officer should dispose of the entire personal 
estate in the manner prescribed by Sec. 72.46.



Sec. 72.48  Consular action on unclaimed estates.

    If, after the expiration of one year from the date of the decedent's 
death, a legal representative has not appeared to claim the estate, the 
consular officer should dispose of the entire personal estate in the 
manner prescribed by Sec. 72.46.



Sec. 72.49  Disposition of estate upon departure of responsible officer.

    (a) Responsibility vested in officer, not post. For the purpose of 
the regulations in this part, the consular officer who actually takes 
possession and disposes of the personal estate of the deceased, i.e., 
the officer whose signature appears on the inventory of effects, is 
considered to be the responsible officer. Consequently, upon his 
departure from the post, either on transfer or extended leave, provision 
should be made for the disposition of any estate remaining unsettled at 
the time of his departure.
    (b) Procedure when estate held for less than one year. When the 
personal estate is held less than one year, the personal effects in the 
departing officer's possession should be turned over to another officer 
at the post against a receipt therefor, in triplicate, identifying the 
property and cash on hand by reference to the inventory (Secs. 72.35 and 
72.36) and the trust fund records of the post.
    (c) Procedure when estate held for more than one year. When the 
estate has been held for more than one year, the personal effects in the 
departing officer's possession should be forwarded to the Department for 
transmission to the General Accounting Office in the manner prescribed 
by Sec. 72.46 and accounted for in accordance with Sec. 72.50 unless 
circumstances as described in Secs. 72.46 and 72.47 warrant continuing 
efforts to effect agreement between rival claimants, or to establish an 
unproved claim. If the estate is not forwarded to the Department, it 
should be turned over to another officer at the post in the same manner 
authorized by paragraph (b) of this section.



Sec. 72.50  Final statement of account.

    The consular officer must account directly to the parties in 
interest and to the courts of law in estate matters. Consequently, he 
must keep an account

[[Page 277]]

of receipts and expenditures for the personal estate of the deceased; 
i.e., debit all moneys and effects which actually come into his 
possession, and credit all payments made on account of the estate. At 
such time as the consular officer is ready to deliver the estate, he 
should prepare his final statement of account, entering thereon the 
balance delivered to the legal representative or person designated by 
him (with name and address stipulated) or the balance forwarded to the 
Department for transmission to the General Accounting Office.



Sec. 72.51  Preparation and disposition of final statement of account.

    The final statement of account should be prepared in quadruplicate. 
All copies should be signed by the accountable officer and the consular 
impression seal impressed on each copy, and should be disposed of in the 
following manner:
    (a) The original should be sent to the legal representative with the 
final balance due the estate;
    (b) One copy retained in the office files; and
    (c) Two copies, under cover of a despatch, submitted to the 
Department (one copy for transmission to the General Accounting Office).

In all cases where the residue of the personal estate is to be 
transmitted to the General Accounting Office for safekeeping and 
disposition (see Secs. 72.46 to 72.48), the original should be sent to 
the Department, together with the two copies normally submitted, 
accompanied by a despatch giving detailed information concerning the 
efforts made by the consular officer to deliver the personal effects to 
a legal representative or other authorized person. Any information 
concerning the last known address of the decedent in the United States 
should also be supplied.



Sec. 72.52  Fee services.

    Fees are charged for overseeing the appraisal, sale and final 
disposition of the estate, disbursing funds, and forwarding securities, 
etc., as provided in the Schedule of Fees, 22 CFR 22.1.
[63 FR 6480, Feb. 9, 1998]



Sec. 72.53  No-fee services.

    Fees are not chargeable:
    (a) For taking possession of, making an inventory, placing the 
official seal on the estate (real or personal property), or for breaking 
or removing such seals (Secs. 72.28-72.29);
    (b) On funds furnished by relatives or other interested persons to 
cover expenses incident to the death and disposition of the remains, or 
for the settlement of the estate (Sec. 72.39(b));
    (c) On securities and other instruments not negotiated (or not 
negotiable) by the consular officer (Sec. 72.28(g)), or on bank 
deposits;
    (d) For releasing on the spot against memorandum receipt and without 
occasion either for safekeeping on official accountability or for 
consular inventory and appraisal, to the legal representative or other 
authorized person in the country, of personal property taken into 
nominal possession for the explicit purposes of transfer of custody 
(Sec. 72.29(a)).
[22 FR 10841, Dec. 27, 1957, as amended at 63 FR 6480, Feb. 9, 1998]



Sec. 72.54  Estates of Government personnel exempt from fee assessments.

    The personal estates of all officers and employees of the United 
States who die abroad while on official duty, including military and 
civilian personnel of the Department of Defense and United States Coast 
Guard (see Secs. 72.23 and 72.24) are exempt from the assessment of any 
Foreign Service fees.



Sec. 72.55  Estates of citizens dying on the high seas exempt from fee assessments.

    The personal estates of all United States citizens who have died on 
the high seas are exempt from the assessment of any Foreign Service fees 
(see Sec. 72.25).

[[Page 278]]



                    SUBCHAPTER I--SHIPPING AND SEAMEN





PART 89--PROHIBITIONS ON LONGSHORE WORK BY U.S. NATIONALS--Table of Contents




    Authority:  8 U.S.C. 1288, Public Law 101-649, 104 Stat. 4878.



Sec. 89.1  Prohibitions on Longshore work by U.S. nationals; listing by country.

    The Secretary of State has determined that, in the following 
countries, longshore work by crewmembers aboard United States vessels is 
prohibited by law, regulation, or in practice, with respect to the 
particular activities noted:

                                 Algeria

    (a) All longshore activities.

                                 Angola

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches
    (2) Rigging of ship's gear, and
    (3) Loading and discharge of cargo on board the ship if local labor 
is paid as if they had done the work.

                                Argentina

    (a) All longshore activities.
    (b) Exceptions:
    (1) Cargo tiedown and untying,
    (2) When a disaster occurs,
    (3) Provision of vessel supplies, and
    (4) Opening and closing of hatches.

                                Australia

    (a) All longshore activities.
    (b) Exceptions:
    (1) When shore labor cannot be obtained at rates prescribed by 
collective bargaining agreements,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 Bahamas

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment on board the ship,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear, and
    (4) Use of specialized equipment which port workers cannot handle 
alone, with the concurrence of the local longshore union.

                               Bangladesh

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment integral to the vessel when 
there is a shortage of port workers able to operate the equipment and 
with the permission of the port authority, and
    (2) Opening and closing of hatches.

                                 Belgium

    (a) All longshore activities.

                                 Belize

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                  Benin

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 Bermuda

    (a) Loading and discharge of cargo using cranes and loading 
equipment situated on the docks or wharves.
    (b) Line handling on the docks.

                                 Brazil

    (a) All longshore activities at public terminals.

                                Bulgaria

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear,

[[Page 279]]

    (4) Mooring and line handling, and
    (5) Operation of special equipment and discharge of dangerous cargo, 
with the preliminary authorization of the Port Administration and Harbor 
Master.

                                  Burma

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                Cameroon

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                 Canada

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches,
    (2) Cleaning of holds and tanks,
    (3) Loading of ship's stores,
    (4) Operation of onboard rented equipment,
    (5) Ballasting and deballasting,
    (6) Rigging of ship's gear,
    (7) Exceptions in connection with bulk cargo at Great Lakes ports 
only:
    (i) Handling of mooring lines on the dock when the vessel is made 
fast, shifted or let go,
    (ii) Moving the vessel to place it under shoreside loading and 
unloading equipment,
    (iii) Moving the vessel in position to unload the vessel onto 
specific cargo piles, hoppers or conveyor belt systems, and
    (iv) Operation of cargo related equipment integral to the vessel.
    (8) Operation of self-loading/unloading equipment and line handling 
by the crews of bulk vessels calling at private terminals, and
    (9) Operation of specialized self-loading/unloading log carriers on 
the Pacific Coast.

                               Cape Verde

    (a) All longshore activities.

                                  China

    (a) Handling of mooring lines.

                                Colombia

    (a) All longshore activities.
    (b) Exception: When local workers are unable or unavailable to 
provide longshore services.

                                 Comoros

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear, and
    (4) Other activities with government authorization.

                               Costa Rica

    (a) Operation of equipment fixed to the ground.

                              Cote d'Ivoire

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of automated ship's gear.

                                 Croatia

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment on board the ship when 
outside of port, and
    (2) Operation of specialized unloading equipment.

                                 Cyprus

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                Djibouti

    (a) All longshore activities.
    (b) Exception: Operation of cranes aboard ship.

                                Dominica

    (a) All longshore activities.

                           Dominican Republic

    (a) All longshore activities.
    (b) Exception: Operation of equipment with which local port workers 
are not familiar.

[[Page 280]]

                                 Ecuador

    (a) All longshore activities.

                                  Egypt

    (a) Cargo loading and unloading activities not on board the ship.

                               El Salvador

    (a) All longshore activities.

                                 Eritrea

    (a) All longshore activities.
    (b) Exception: Opening and closing of hatches and rigging of ship's 
gear if port labor is paid as if it had done the work.
    Estonia
    (a) All longshore activities.
    (b) Exceptions:
    (1) On-board mooring activities,
    (2) Replacement of lines,
    (3) Lifting and movement of ladders,
    (4) Movement of vessel's equipment,
    (5) Loading of food and vessel's equipment by cargo-related 
equipment of the vessel, and
    (6) Securing of general cargo, vehicles and containers to the 
vessel.

                                  Fiji

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo related equipment, except for discharging 
cargo,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 Finland

    (a) All longshore activities.
    (b) Exceptions, when not related to cargo loading and discharge:
    (1) Operation of cargo-related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 France

    (a) All longshore activities.
    (b) Exceptions:
    (1) Loading and discharge of the ship's own material and provisions 
if done by the ship's own equipment or by the owner of the merchandise 
using his own personnel,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear,
    (4) Operation of cargo-related equipment to shift cargo internally,
    (5) Handling operations connected with shipbuilding and refitting, 
and
    (6) Offloading fish by the crew or personnel working for the ship 
owner.

                                  Gabon

    (a) All longshore activities.
    (b) Exception: All longshore activities if local workers are paid as 
if they had done the work.

                                 Georgia

    (a) All longshore activities.
    (b) Exception: All longshore activities if local workers are paid as 
if they had done the work.

                                 Germany

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                  Ghana

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 Greece

    (a) Operation of shore-based equipment to load/unload a vessel.

                                Guatemala

    (a) All longshore activities.

                                 Guinea

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                 Guyana

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment aboard ship,
    (2) Opening and closing of hatches, and

[[Page 281]]

    (3) Rigging of ship's gear.

                                  Haiti

    (a) All longshore activities.

                                Honduras

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                Hong Kong

    (a) Operation of equipment on the pier.

                                 Iceland

    (a) All longshore activities.
    (b) Exception: Operation of shipboard equipment and cranes.

                                  India

    (a) All longshore activities.
    (b) Exception: Operation of shipboard equipment that local port 
workers cannot operate.

                                Indonesia

    (a) All longshore activities.
    (b) Exceptions:
    (1) With the permission of the port administrator, when no local 
port workers with requisite skills are available, and
    (2) In the event of an emergency.

                                 Ireland

    (a) All longshore activities.

                                 Israel

    (a) All longshore activities.

                                  Italy

    (a) Cargo loading, discharge and transfer without the permission of 
the Maritime Administration or the local port authority, if no office of 
the Maritime Administration is present, and a deposit for possible use 
of port stevedoring services.
    (b) Handling of lines on the dock and other longshore activities not 
immediate related to cargo handling.

                                 Jamaica

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of equipment integral to the vessel,
    (2) Opening and closing of hatches, jointly with local port workers, 
and
    (3) Rigging of ship's gear jointly with local port workers.

                                  Japan

    (a) All longshore activities.

                                 Jordan

    (a) All longshore activities.

                                  Kenya

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches,
    (2) Rigging of ship's gear,
    (3) In an emergency declared by the port authority, and
    (4) Direct transfer of cargo from one ship to another.

                                  Korea

    (a) All longshore activities.

                                 Kuwait

    (a) All longshore activities.
    (b) Exceptions, when activities are declined by port workers:
    (1) Operation of cargo-related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                                 Liberia

    (a) Longshore activities on shore.

                                Lithuania

    (a) The following activities in harbor:
    (1) Loading and discharge of cargo,
    (2) Maintenance of port equipment,
    (3) Receiving and fixing of dock ropes to harbor equipment,
    (4) Transportation of cargo within the port, and
    (5) Warehousing and security.
    (b) Exception: Opening and closing of hatches.

                               Madagascar

    (a) All longshore activities.

[[Page 282]]

                                Malaysia

    (a) All longshore activities.
    (b) Exception: Loading and discharge of hazardous materials.

                             Maldive Islands

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment aboard ship,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear, and
    (4) Other longshore activities within port limits, when authorized 
by the port authority in cases when the port authority is unable to 
provide longshore workers.

                                  Malta

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                               Mauritania

    (a) All longshore activities on shore.

                                Mauritius

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                 Mexico

    (a) All longshore activities.
    (b) Exception: Onboard activities if local workers are paid as if 
they had done the work.

                               Micronesia

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation and rigging of gear which local port workers cannot 
do, and
    (2) When no qualified citizens are available.

                                 Morocco

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of ship's gear which port workers cannot operate,
    (2) Opening and closing of hatches,
    (3) Rigging of ship's gear aboard ship, and
    (4) Fastening and unfastening containers.

                               Mozambique

    (a) All longshore activities on shore.

                                 Namibia

    (a) Longshore activities on shore.

                                  Nauru

    (a) All longshore activities.

                               Netherlands

    (a) All longshore activities.
    (b) Exception: Regular crew activities on board ship, including 
operation of cargo-related equipment, opening and closing of hatches, 
and rigging of ship's gear.

                          Netherlands Antilles

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of ship's gear,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                               New Zealand

    (a) All longshore activities.

                                Nicaragua

    (a) All longshore activities.
    (b) Exception: Shipboard activities if local workers are paid as if 
they had done the work.

                                Pakistan

    (a) Longshore activities on shore.
    (b) Handling of mooring lines.
    (c) Exception: Operation of equipment which dock workers are not 
capable of operating.

                                 Panama

    (a) All longshore activities.
    (b) Exceptions:
    (1) Rigging of ship's gear,
    (2) Cargo handling operations with ship's gear, when port authority 
equipment is not available to load or unload a vessel.

[[Page 283]]

                            Papua New Guinea

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                  Peru

    (a) All longshore activities.
    (b) Exceptions:
    (1) Handling of certain types of hazardous cargo, and
    (2) Operation of shipboard equipment requiring special training.

                               Philippines

    (a) All longshore activities.
    (b) Exceptions:
    (1) Activities on board ship, except for loading and discharge of 
cargo,
    (2) Longshore activities for hazardous or polluting cargoes, and
    (3) Longshore activities on government vessels.

                                 Poland

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment,
    (2) Opening and closing of hatches, and
    (3) Rigging of ship's gear.

                       Portugal (including Azores)

    (a) All longshore activities.
    (b) Exceptions:
    (1) Military operations,
    (2) Operations in an emergency, when under the supervision of the 
maritime authorities,
    (3) Security or inspection operations,
    (4) Loading and discharge of supplies for the vessel and its crew,
    (5) Loading and discharge of fuel and petroleum products at special 
terminals,
    (6) Loading and discharge of chemical products if required for 
safety reasons,
    (7) Placing of trailers and similar material in parking areas when 
done before loading or after discharge,
    (8) Cleaning of the vessel, and
    (9) Loading, discharge and disposal of merchandise in other boats.

                                  Qatar

    (a) All longshore activities.

                                 Romania

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of specialized shipboard equipment, and
    (2) Loading and discharge of cargo requiring special operations.

                                St. Lucia

    (a) All longshore activities.

                     St. Vincent and the Grenadines

    (a) All longshore activities.

                              Saudi Arabia

    (a) All longshore activities.

                                 Senegal

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches,
    (2) Rigging of ship's gear, and
    (3) Cargo handling when necessary to ensure the safety or stability 
of the vessel.

                               Seychelles

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                              Sierra Leone

    (a) All longshore activities.

                                Slovenia

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                             Solomon Islands

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                              South Africa

    (a) All longshore activities.
    (b) Exceptions:

[[Page 284]]

    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                  Spain

    (a) All longshore activities.

                                Sri Lanka

    (a) Longshore activities on shore.

                                 Sweden

    (a) Loading and discharge of cargo.
    (b) Rigging of cargo nets, straps and wires to make ready for 
loading by the crane.
    (c) Cargo handling.
    (d) Line handling on the dock.

                                 Taiwan

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment which local longshoremen 
cannot operate, and
    (2) Opening and closing of hatches operated automatically.

                                Tanzania

    (a) All longshore activities.
    (b) Exception: All longshore activities if local workers are paid as 
if they had done the work.

                                Thailand

    (a) Longshore activities on shore.
    (b) Exception: Longshore activities in private ports.

                                  Togo

    (a) All longshore activities.
    (b) Exceptions:
    (1) Operation of cargo-related equipment on board the ship, and
    (2) Opening and closing of hatches, upon the agreement of the port 
officer on duty.

                           Trinidad and Tobago

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, if done automatically, and
    (2) Rigging of ship's gear.

                                 Tunisia

    (a) All longshore activities.
    (b) Exception: When the number of local dock workers is insufficient 
or when the workers are not qualified to do the work.

                                 Uruguay

    (a) Stowing, unstowing, loading and discharge, and related 
activities on board ships in commercial ports.
    (b) Cargo handling on the docks and piers of commercial ports.
    (c) Exception: Activities usually performed by the ship's crew, 
including operation of cargo-related equipment, opening and closing of 
hatches and rigging of ship's gear.

                                 Vanuatu

    (a) All longshore activities on shore.

                                Venezuela

    (a) Longshore activities in private ports and terminals.

                              Western Samoa

    (a) All longshore activities.
    (b) Exceptions:
    (1) Opening and closing of hatches, and
    (2) Rigging of ship's gear.

                                  Yemen

    (a) All longshore activities.

                                  Zaire

    (a) All longshore activities.
    (b) Exception: Operation of cargo-related equipment, when authorized 
by the Port Authority.
[61 FR 29945, June 13, 1996]

[[Page 285]]



                SUBCHAPTER J--LEGAL AND RELATED SERVICES





PART 91--IMPORT CONTROLS--Table of Contents




Sec.
91.1  Answering inquiries regarding tariff acts and custom regulations.
91.2  Furnishing samples to collectors of customs or appraising 
          officers.
91.3  Assistance to Customs and Tariff Commission representatives.
91.4  Alcoholic liquors on vessels of not over 500 tons.

    Authority:  Sec. 4, 63 Stat. 111, as amended; 22 U.S.C. 2658.

    Source:  22 FR 10858, Dec. 27, 1957, unless otherwise noted.



Sec. 91.1  Answering inquiries regarding tariff acts and customs regulations.

    In replying to inquiries received from exporters, travelers, or 
other interested parties, concerning tariff acts or customs regulations, 
consular officers shall refrain from giving, or appearing to give, 
decisions pertaining to matters upon which hey are not competent to 
pass.



Sec. 91.2  Furnishing samples to collectors of customs or appraising officers.

    Upon the receipt of a request therefor from a collector of customs 
or appraising officer of the Government of the United States, a consular 
officer shall procure and forward samples of merchandise being imported 
or offered for importation into the United States from his particular 
district.



Sec. 91.3  Assistance to Customs and Tariff Commission representatives.

    Consular officers shall render all proper assistance to Customs and 
Tariff Commission representatives abroad to aid them in the performance 
of their official duties.



Sec. 91.4  Alcoholic liquors on vessels of not over 500 tons.

    (a) Upon request of interested shippers or masters of vessels at 
ports in the consular district other than the place where the consular 
office is situated, consular officers shall designate one or more 
reputable individuals residing in each such port, as authorized persons 
to witness the signatures of the masters of vessels of not over 500 net 
tons when affixed to declarations covering shipments of alcoholic 
liquors destined to the United States, and to issue certificates 
therefor as contemplated by section 7 of the Anti-Smuggling Act of 1935 
(49 Stat. 520; 19 U.S.C. 1707). Any person so designated by a consular 
officer to issue such certificates shall state in each of his 
certificates that he has no interest in the shipment described therein. 
Having delivered the original document to the master, he shall forward 
the duplicate to the consular office for retention.
    (b) Consular officers shall, with respect to declarations of masters 
of vessels of not over 500 net tons in instances in which the port of 
shipment is the same place as, or conveniently near to, the location of 
the consular office, supply their certifications directly as 
contemplated by the said section of the Anti-Smuggling Act. They shall 
retain, over the interval prescribed in the applicable records 
retirement schedule, a copy of each document so certified by them. They 
shall similarly retain the copies of the certifications supplied by 
authorized persons in outlying ports of the consular district, as set 
forth in the preceding subsection.
    (c) This section, read together with Sec. 4.13, title 19, of the 
Code of Federal Regulations, comprises the joint regulations 
contemplated for issuance by the Secretary of State and the Secretary of 
the Treasury under section 7 of the Anti-Smuggling Act of 1935.
[32 FR 12588, Aug. 30, 1967]



PART 92--NOTARIAL AND RELATED SERVICES--Table of Contents




                              Introduction

Sec.
92.1  Definitions.
92.2  Description of overseas notarial functions of the Department of 
          State, record of acts.
92.3  Consular districts.
92.4  Authority of notarizing officers of the Department of State under 
          the Federal law.
92.5    Acceptability of notarial acts under

[[Page 286]]

          State or territorial law.
92.6  Authority of notarizing officers under international practice.
92.7  Responsibility of notarizing officers of the Department of State.

                       General Notarial Procedures

92.8  Compliance with request for notarial services.
92.9  Refusals of requests for notarial services.
92.10  Specific waiver in notarial certificate.
92.11  Preparation of legal documents.
92.12  Necessity for certification of notarial acts.
92.13  Form of notarial certificate.
92.14  Venue on notarial certificates.
92.15  Signing notarial certificate.
92.16  Sealing the notarial certificate.
92.17  Fastening of pages.

                         Specific Notarial Acts

92.18  Oaths and affirmations defined.
92.19  Administering an oath.
92.20  Administering an affirmation.
92.21  Notarial certificate to oath or affirmation.
92.22  ``Affidavit'' defined.
92.23  Taking an affidavit.
92.24  Usual form of affidavit.
92.25  Title of affidavit.
92.26  Venue on affidavit.
92.27  Affiant's allegations in affidavit.
92.28  Signature of affiant on affidavit.
92.29  Oath or affirmation to affidavit.
92.30  ``Acknowledgment'' defined.
92.31  Taking an acknowledgment.
92.32  Notarial certificate to acknowledgment.
92.33  Execution of certificate of acknowledgment.
92.34  Fastening certificate to instrument.
92.35  Errors in certificate of acknowledgment.
92.36  ``Authentication'' defined.
92.37  Authentication procedure.
92.38  Forms of certificate of authentication.
92.39  Authenticating foreign public documents (Federal procedures).
92.40  Authentication of foreign extradition papers.
92.41  Limitations to be observed in authenticating documents.
92.42  Certification of copies of foreign records relating to land 
          titles.
92.43  Fees for notarial services and authentications.

                    Depositions and Letters Rogatory

92.49  ``Deposition'' defined.
92.50  Use of depositions in court actions.
92.51  Methods of taking depositions in foreign countries.
92.52  ``Deposition on notice'' defined.
92.53  ``Commission to take depositions'' defined.
92.54  ``Letters rogatory'' defined.
92.55  Consular authority and responsibility for taking depositions.
92.56  Summary of procedure for taking depositions.
92.57  Oral examination of witnesses.
92.58  Examination on basis of written interrogatories.
92.59  Recording of objections.
92.60    Examination procedures.
92.61  Transcription and signing of record of examination.
92.62  Captioning and certifying depositions.
92.63  Arrangement of papers.
92.64  Filing depositions.
92.65  Depositions to prove genuineness of foreign documents.
92.66  Depositions taken before foreign officials or other persons in a 
          foreign country.
92.67  Taking of depositions in United States pursuant to foreign 
          letters rogatory.
92.68  Foreign Service fees and incidental costs in the taking of 
          evidence.
92.69  Charges payable to foreign officials, witnesses, foreign counsel, 
          and interpreters.
92.70  Special fees for depositions in connection with foreign 
          documents.
92.71  Fees for letters rogatory executed by officials in the United 
          States.

                     Miscellaneous Notarial Services

92.72    Services in connection with patents and patent applications.
92.73  Services in connection with trademark registrations.
92.74  Services in connection with United States securities or interests 
          therein.
92.75  Services in connection with income tax returns.

         Copying, Recording, Translating and Procuring Documents

92.76  Copying documents.
92.77  Recording documents.
92.78  Translating documents.
92.79  Procuring copies of foreign public documents.
92.80  Obtaining American vital statistics records.

                          Quasi-Legal Services

92.81  Performance of legal services.
92.82  Recommending attorneys or notaries.
92.84  ``Legal process'' defined.
92.85  Service of legal process usually prohibited.
92.86  Consular responsibility for serving subpoenas.
92.87  Consular responsibility for serving orders to show cause.
92.88  Consular procedure.
92.89  Fees for service of legal process.
92.90  Delivering documents pertaining to the revocation of 
          naturalization.

[[Page 287]]

92.91  Service of documents at request of Congressional committees.
92.92  Service of legal process under provisions of State law.
92.93  Notarial services or authentications connected with service of 
          process by other persons.
92.94  Replying to inquiries regarding service of process or other 
          documents.
92.95  Transportation of witnesses to the United States.

    Authority:  22 U.S.C. 2658, unless otherwise noted.

    Source:  22 FR 10858, Dec. 27, 1957, unless otherwise noted.

                              Introduction



Sec. 92.1  Definitions.

    (a) In the United States the term notary or notary public means a 
public officer qualified and bonded under the laws of a particular 
jurisdiction for the performance of notarial acts, usually in connection 
with the execution of some document.
    (b) The term notarial act means an act recognized by law or usage as 
pertaining to the office of a notary public.
    (c) The term notarial certificate may be defined as the signed and 
sealed statement to which a ``notarial act'' is almost invariably 
reduced. The ``notarial certificate'' attests to the performance of the 
act by the notary, and may be an independent document or as in general 
American notarial practice, may be placed on or attached to the 
notarized document.
    (d) For purposes of this part, except Secs. 92.36 through 92.42 
relating to the authentication of documents, the term notarizing officer 
includes consular officers, officers of the Foreign Service who are 
secretaries of embassy or legation under Section 24 of the Act of August 
18, 1856, 11 Stat. 61, as amended (22 U.S.C. 4221), and such U.S. 
citizen Department of State employees as the Deputy Assistant Secretary 
of State for Overseas Citizens Services may designate for the purpose of 
performing notarial acts overseas pursuant to section 127(b) of the 
Foreign Relations Authorization Act, Fiscal Years 1994-1995, Pub. L. 
103-236, April 30, 1994 (``designated employees''). The authority of 
designated employees to perform notarial services shall not include the 
authority to perform authentications, to notarize patent applications, 
or take testimony in a criminal action or proceeding pursuant to a 
commission issued by a court in the United States, but shall otherwise 
encompass all notarial acts, including but not limited to administering 
or taking oaths, affirmations, affidavits or depositions.
    The notarial authority of a designated employee shall expire upon 
termination of the employee's assignment to such duty and may also be 
terminated at any time by the Deputy Assistant Secretary for Overseas 
Citizen Services.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51721, Oct. 3, 1995]



Sec. 92.2  Description of overseas notarial functions of the Department of State, record of acts.

    The overseas notarial function of notarizing officers of the 
Department of State is similar to the function of a notary public in the 
United States. See Sec. 22.5(b) of this chapter concerning the giving of 
receipts for fees collected and the maintenance of a register serving 
the same purposes as the record which notaries are usually expected or 
required to keep of their official acts.
[60 FR 51721, Oct. 3, 1995]



Sec. 92.3  Consular districts.

    Where consular districts have been established, the geographic 
limits of the district determine the area in which notarial acts can be 
performed by the notarizing officer. See Sec. 92.41 (b) regarding 
authentication of the seals and signatures of foreign officials outside 
the consular district.
[27 FR 12616, Dec. 20, 1962, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.4  Authority of notarizing officers of the Department of State under Federal law.

    (a) All notarizing officers are required, when application is made 
to them within the geographic limits of their consular district, to 
administer to and take from any person any oath, affirmation, affidavit, 
or deposition, and to perform any notarial act which any notary public 
is required or authorized by law to perform within the United States. 
The term ``notarial act''

[[Page 288]]

as used herein shall not include the performance of extraordinary acts, 
such as marriages, that have not been traditionally regarded as 
notarial, notwithstanding that notary publics may be authorized to 
perform such acts in some of the states of the United States. If a 
request is made to perform an act that the notarizing officer believes 
is not properly regarded as notarial within the meaning of this 
regulation, the officer shall not perform the act unless expressly 
authorized by the Department upon its determination that the act is a 
notarial act within the meaning of 22 U.S.C. 4215 and 4221. The language 
``within the limits of the consulate'' is construed to mean within the 
geographic limits of a consular district. With respect to notarial acts 
performed by notarizing officers away from their office, see Sec. 92.7. 
Notarial acts shall be performed only if their performance is authorized 
by treaty provisions or is permitted by the laws or authorities of the 
country wherein the notarizing officer is stationed.
    (b) These acts may be performed for any person regardless of 
nationality so long as the document in connection with which the 
notarial service is required is for use within the jurisdiction of the 
Federal Government of the United States or within the jurisdiction of 
one of the States or Territories of the United States. (However, see 
also Sec. 92.6.) Within the Federal jurisdiction of the United States, 
these acts, when certified under the hand and seal of office of the 
notarizing officer are valid and of like force and effect as if 
performed by any duly authorized and competent person within the United 
States. Documents bearing the seal and signature of a secretary of 
embassy or legation, consular officer (including consul general, vice 
consul or consular agent) are admissible in evidence within the Federal 
jurisdiction without proof of any such seal or signature being genuine 
or of the official character of the notarizing officer.
    (c) Every notarizing officer may perform notarial acts for use in 
countries occupied by the United States or under its administrative 
jurisdiction, provided the officer has reason to believe that the 
notarial act will be recognized in the country where it is intended to 
be used. These acts may be performed for United States citizens and for 
nationals of the occupied or administered countries, who reside outside 
such countries, except in areas where another government is protecting 
the interests of the occupied or administered country.
    (d) Chiefs of mission, that is, ambassadors and ministers, have no 
authority under Federal law to perform notarial acts except in 
connection with the authentication of extradition papers (see 
Sec. 92.40).
    (e) Consular agents have authority to perform notarial services but 
acting consular agents do not.
[22 FR 10858, Dec. 27, 1957, as amended at 27 FR 12616, Dec. 20, 1962; 
60 FR 51721, Oct. 3, 1995]



Sec. 92.5  Acceptability of notarial acts under State or territorial law.

    The acceptability with the jurisdiction of a State or Territory of 
the United States of a certificate of a notarial act performed by a 
notarizing officer depends upon the laws of the State or Territory.
[60 FR 51721, Oct. 3, 1995]



Sec. 92.6  Authority of notarizing officers under international practice.

    Although such services are not mandatory, notarizing officers may, 
as a courtesy, perform notarial acts for use in countries with which the 
United States has formal diplomatic and consular relations. Generally 
the applicant for such service will be a United States citizen or a 
national of the country in which the notarized document will be used. 
The notarizing officer's compliance with a request for a notarial 
service of this type should be based on the reasonableness of the 
request and the absence of any apparent irregularity. When a notarizing 
officer finds it advisable to do so, the officer may question the 
applicant to such extent as may be necessary to be assured of the 
reasonableness of the request and the absence of irregularity.
    (a) That his notarial certificate may reasonably be expected to 
satisfy the legal requirements of the country in which the notarized 
document will be used;

[[Page 289]]

    (b) That the notarial service is legally necessary and cannot be 
obtained otherwise than through a United States notarizing officer 
without loss or serious inconvenience to the applicant; and
    (c) That the notarial certifcate will be used solely for a well-
defined purpose, as represented by the applicant for the service. (See 
also Sec. 92.4(c) regarding notarial services for use in countries 
occupied by the United States or under its administrative jurisdiction.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51721, Oct. 3, 1995]



Sec. 92.7  Responsibility of notarizing officers of the Department of State.

    (a) As a rule notarial acts should be performed at the consular 
office. Where required by the circumstances of a particular case and 
subject to the reasonableness of the request notarial acts may be 
performed elsewhere within the limits of the consulate subject to the 
assessment of the applicable fees under subheading ``Services Rendered 
Outside of Office'' of the Tariff of Fees (Sec. 22.1(a) of this 
chapter), as well as to payment by the interested party of the officer's 
expenses in going to the place where the service is performed and 
returning to his office (Sec. 22.1(b) of this chapter).
    (b) As indicated in Secs. 92.4, 92.5, and 92.6, the authority of 
secretaries of embassy or legation as well as consular officers to 
perform notarial acts is generally recognized. However, the function is 
essentially consular, and notarial powers are in practice exercised by 
diplomatic officers only in the absence of a consular officer or U.S. 
citizen State Department employee designated to perform notarial 
functions as provided in Sec. 92.1(d). Performance of notarial acts by 
an officer assigned in dual diplomatic and consular capacity shall be 
performed in his/her consular capacity, except in special circumstances.
[27 FR 12616, Dec. 20, 1962, as amended at 60 FR 51721, Oct. 3, 1995]

                       General Notarial Procedures



Sec. 92.8  Compliance with request for notarial services.

    A notarizing officer should comply with all proper requests for the 
performance of notarial services within the limitations prescribed in 
this part. (See particularly Secs. 92.3 to 92.7). Moreover, as a 
representative of the United States Government, the notarizing officer, 
when acting in a notarial capacity, should take great care to prevent 
the use of his official seal in furthering any unlawful or clearly 
improper purpose. (See Sec. 92.9 regarding refusal to perform notarial 
services in certain cases.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51721, Oct. 3, 1995]



Sec. 92.9  Refusals of requests for notarial services.

    (a) A notarizing officer should refuse requests for notarial 
services, the performance of which is not authorized by treaty 
provisions or permitted by the laws or authorities of the country in 
which he is stationed. (See Sec. 92.4(a).) Also, a notarizing officer 
should refuse to perform notarial acts for use in transactions which may 
from time to time be prohibited by law or by regulations of the United 
States Government such, for example, as regulations based on the 
``Trading With the Enemy Act of 1917,'' as amended.
    (b) A notarizing officer is also authorized to refuse to perform a 
notarial act if he had reasonable grounds for believing that the 
document in connection with which his notarial act is requested will be 
used for a purpose patently unlawful, improper or inimical to the best 
interests of the United States. Requests for notarial services should be 
refused only after the most careful deliberation.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.10  Specific waiver in notarial certificate.

    If the notarizing officer has reason to believe that material 
statements in a document presented for notarization are false, and if no 
basis exists for refusing the notarial service in accordance with 
Sec. 92.9, he may consider the advisability of informing the applicant 
that he will perform the service only with a specific waiver of 
responsibility included in the notarial certificate. Furthermore, a 
notarizing officer may, in his discretion, add to the specific waiver in 
the notarial certificate a

[[Page 290]]

statement of verifiable facts known to him, which will reveal the 
falsity of material in the document. However, normally a notarizing 
officer shall exercise great caution not to limit the general privilege 
of a United States citizen while abroad to execute under oath any 
statement he sees fit to make, including mistaken, unnecessary, and even 
frivolous statements: Provided, That substantial and compelling reasons 
do not exist which impel restraining action on the part of the 
notarizing officer. On the other hand, experience has shown the 
desirability of including, as standard practice, a specific waiver of 
responsibility in all authentications (Sec. 92.38) executed in 
connection with divorce proceedings.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.11  Preparation of legal documents.

    (a) By attorneys. When a document has been prepared by an attorney 
for signature, a notarizing officer should not question the form of 
document unless it is obviously incorrect.
    (b) By notarizing officers. A notarizing officer should not usually 
prepare for private persons legal documents for signature and 
notarization. (However, see the provisions in Sec. 92.24 regarding the 
preparation of affidavits.) When asked to perform such a service, the 
notarizing officer should explain that the preparation of legal forms is 
normally the task of an attorney, that the forms used and the purposes 
for which they are used vary widely from jurisdiction to jurisdiction 
and that he could not guarantee the legal effectiveness of any document 
which he might prepare. The person desiring the preparation of a legal 
document should be referred to such publications as Jones Legal Forms 
and The Lawyers Directory with the suggestion that he select or adapt 
the form which appears best suited to his needs. The notarizing officer 
may, in his discretion, arrange to have a member of his office staff 
type the document. If the document is typed in the Foreign Service 
office, the fee for copying shall be collected as prescribed under the 
caption ``Copying and Recording'' of the Tariff of Fees, Foreign Service 
of the United States of America (Sec. 22.1 of this chapter).
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.12  Necessity for certification of notarial acts.

    A notarizing officer must execute a written certificate attesting to 
the performance of a notarial act. This certificate may be inserted on 
or appended to the notarized document (see Sec. 92.17 regarding the 
fastening of sheets). The certificate evidences the performance of the 
notarial act. Failure to execute this certificate renders the notarial 
act legally ineffective. Each notarial act should be evidenced by a 
separate certificate; two or more distinct notarial acts should not be 
attested to by one certificate.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51721, Oct. 3, 1995]



Sec. 92.13  Form of notarial certificate.

    The form of a notarial certificate depends on the nature of the 
notarial act it attests. (See Secs. 92.18 to 92.48 for discussions of 
the various forms of notarial certificates.) Rules pertaining to venue, 
and signing and sealing, are common to all notarial certificates.



Sec. 92.14  Venue on notarial certificates.

    (a) The term venue means the place where the certificate is 
executed. The venue must be shown on all notarial certificates to 
establish the qualifications and sphere of authority of the notarizing 
officer to perform the notarial act. The items characteristic of a 
typical venue, in the order of their appearance in the certificate, are 
as follows:
    (1) Name of the country (or dominion, Territory, colony, island, as 
appropriate);
    (2) Name of province or major administrative region (if none, this 
may be omitted);
    (3) Name of local community (city, town, or village);
    (4) Name of the Foreign Service post.
    (b) When a notarial act is performed, and the notarial certificate 
executed, at a locality in a consular district other than the locality 
in which the Foreign Service office is situated, the venue should 
mention only the name of

[[Page 291]]

the country (or dominion, territory, colony, island, as appropriate), 
and the name of the consular district.
    (c) The venue used at a Foreign Service post which has not been 
officially designated as an embassy, legation, consulate general, 
consulate, or consular agency should bear the notation ``American 
Consular Service'' in place of the post name.



Sec. 92.15  Signing notarial certificate.

    The notarizing officer should sign a notarial certificate on the 
lower right-hand side. The name and full official title of the 
notarizing officer should by typed, stamped with a rubber stamp, or 
printed in ink on two separate lines immediately below his signature. 
When the notarizing officer is assigned to a Foreign Service post in 
both a diplomatic and consular capacity, he should use his consular 
title in the notarial certificate. (See Sec. 92.7.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.16  Sealing the notarial certificate.

    The notarizing officer should seal a notarial certificate with the 
impression seal of the post on the lower left-hand side of the 
certificate. A notarial certificate executed at a Foreign Service post 
which has not been officially designated as an embassy, legation, 
consulate general, consulate, or consular agency should be sealed with 
an impression seal bearing the legend ``American Consular Service'' and 
the name of the locality.



Sec. 92.17  Fastening of pages.

    When the instrument or document to which a notarial act relates 
consists of more than one sheet, or when the notarial certificate will 
be attached and not written on the document itself, the notarizing 
officer should bring all the sheets comprising the document together 
under his official seal.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]

                         Specific Notarial Acts



Sec. 92.18  Oaths and affirmations defined.

    (a) Oath. An oath is an outward pledge given by the person taking it 
that his attestation or promise is made under an immediate sense of his 
responsibility to God. In a broad sense the word ``oath'' includes all 
forms of attestation by which a person signifies that he is bound in 
conscience to perform an act faithfully and truly, and in this sense it 
includes ``affirmation''.
    (b) Affirmation. An affirmation is a solemn and formal declaration 
or asseveration in the nature of an oath that a statement, or series of 
statements, is true. When an oath is required or authorized by law, an 
affirmation in lieu thereof may be taken by any person having 
conscientious scruples against taking an oath. As a general rule, an 
affirmation has the same legal force and effect as an oath.



Sec. 92.19  Administering an oath.

    The usual formula for administering an oath is as follows: The 
officer administering the oath requests the person taking the oath to 
raise his right hand while the officer repeats the following words: 
``You do solemnly swear that the statements set forth in this paper 
which you have here signed before me are true. So help you God.'' 
Whereupon the person taking the oath answers, ``I do.''



Sec. 92.20  Administering an affirmation.

    In administering an affirmation the procedure followed is generally 
the same as in the case of an oath, but the formula is varied by the use 
of the following words: ``You do solemnly, sincerely, and truly affirm 
and declare that . . ., and this you do under the pains and penalties of 
perjury.''



Sec. 92.21  Notarial certificate to oath or affirmation.

    The written statement attesting to the administration of an oath or 
affirmation is known as a jurat. The jurat must be signed and sealed by 
the notarizing officer (see Secs. 92.15 and 92.16 on signing and sealing 
notarial certificates).



Sec. 92.22  ``Affidavit'' defined.

    An affidavit is a written declaration under oath made before some 
person who has authority to administer oaths, without notice to any 
adverse party

[[Page 292]]

that may exist. One test of the sufficiency of an affidavit is whether 
it is so clear and certain that it will sustain an indictment for 
perjury, if found to be false. An affidavit differs from a deposition in 
that it is taken ex parte and without notice, while a deposition is 
taken after notice has been furnished to the opposite party, who is 
given an opportunity to cross-examine the witness.



Sec. 92.23  Taking an affidavit.

    The notarizing officer taking an affidavit should:
    (a) Satisfy himself, as far as possible, that his notarial act will 
be acceptable under the laws of the jurisdiction where the affidavit is 
to be used (see Sec. 92.5);
    (b) Require the personal appearance of the affiant at the time the 
affidavit is taken;
    (c) Require satisfactory identification of the affiant; and
    (d) Administer the oath to the affiant before the affiant signs the 
affidavit.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.24  Usual form of affidavit.

    Affidavits are usually drawn by competent attorneys or are set out 
in established forms. The form and substantive requirements of an 
affidavit depend principally upon the purpose for which it is made and 
the statutes of the jurisdiction where it is intended to be used. When a 
notarizing officer finds it necessary in the discharge of his official 
duties to prepare an affidavit, or when he assists a private person in 
preparing an affidavit (see Sec. 92.11(b)), he should, where possible, 
consult the pertinent statutory provisions.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.25  Title of affidavit.

    Generally an affidavit taken for use in a pending cause must be 
entitled in that cause so that it will show to what proceedings it is 
intended to apply, and may support an indictment for perjury in case it 
proves to be false. If there is no suit pending at the time the 
affidavit is taken or if the affidavit is not to be used in any cause in 
court, no title need be given.



Sec. 92.26  Venue on affidavit.

    The venue must always be given and should precede the body of the 
affidavit. (See Sec. 92.14 regarding venue on notarial certificates 
generally.)



Sec. 92.27  Affiant's allegations in affidavit.

    (a) Substance of allegations. Although a notarizing officer is 
generally not responsible for the correctness of the form of an 
affidavit or the manner in which the allegations therein are set forth 
(see Sec. 92.11(a) regarding the preparation of legal documents by 
attorneys; Sec. 92.11(b) regarding the preparation of legal documents by 
notarizing officers; and Sec. 92.24 regarding the form of an affidavit), 
he may, in appropriate instances, draw the affiant's attention to the 
following generally accepted criteria as regards the substance of the 
allegations:
    (1) Material facts within the personal knowledge of the affiant 
should be alleged directly and positively. Facts are not to be inferred 
where the affiant has it in his power to state them positively and 
fully.
    (2) If the matters stated in the affiant's affidavit rest upon 
information derived from others rather than on facts within his personal 
knowledge, he should aver that such matters are true to the best of his 
knowledge and belief.
    (3) If the allegations made on information and belief are material, 
the sources of information and grounds of belief should be set out and a 
good reason given why a positive statement could not be made.
    (4) If the conclusions of the affiant are drawn from the contents of 
documents, such contents should be set out or exhibited, so that the 
authority to whom the affidavit is presented may determine whether the 
affiant's deductions are well founded.
    (b) Veracity of allegations. Notarizing officers are not required to 
examine into the truth of the affiant's allegations or to pass upon any 
contentious questions involved. In many instances the matters referred 
to in an affidavit will be of a technical or special nature beyond the 
officer's general knowledge

[[Page 293]]

or experience. However, he may, in certain circumstances, refuse to take 
an affidavit. (See Sec. 92.9 regarding the types of situations in which 
an officer might properly refuse to perform a notarial service; also see 
Sec. 92.10 regarding the waiver and other statements which may be 
included in a notarial certificate where evidence exists of falsity in 
the affiant's declaration.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.28  Signature of affiant on affidavit.

    The signature of the affiant is indispensable. The affiant should 
always sign the affidavit in the presence of the notarizing officer.



Sec. 92.29  Oath or affirmation to affidavit.

    Affidavits made before notarizing officers must be sworn to or 
affirmed (see Sec. 92.23(d)).
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.30  Acknowledgment defined.

    An acknowledgment is a proceeding by which a person who has executed 
an instrument goes before a competent officer or court and declares it 
to be his act and deed to entitle it to be recorded or to be received in 
evidence without further proof of execution. An acknowledgment is almost 
never made under oath and should not be confused with an oath (see 
Sec. 92.18(a) for definition of oath). Moreover, an acknowledgment is 
not the same as an attestation, the latter being the act of witnessing 
the execution of an instrument and then signing it as a witness. 
Instruments requiring acknowledgment generally are those relating to 
land, such as deeds, mortgages, leases, contracts for the sale of land, 
and so on.



Sec. 92.31  Taking an acknowledgment.

    (a) Officers' assurance of acceptability of notarial act. A 
notarizing officer taking an acknowledgment should, if possible, 
ascertain the requirements of the jurisdiction in which the acknowledged 
document is to be used and execute the certificate in accordance with 
those requirements. Not all States or Territories will accept 
certificates of acknowledgment executed by notarizing officers other 
than consuls. Therefore, notarizing officers and consular agents who are 
called upon to perform this notarial act should consult the applicable 
State or territorial law to ascertain whether certificates of 
acknowledgment will be acceptable. (See Sec. 92.5 regarding 
acceptability of consular notarial acts under state or territorial law.) 
Furthermore, public policy generally forbids that the act of taking and 
certifying an acknowledgment be performed by a person financially or 
beneficially interested in the transaction to which the acknowledged 
document relates. Notarizing officers should keep this point in mind, 
especially in connection with acknowledgments by members of their 
families.
    (b) Personal appearance of grantor(s). A notarizing officer taking 
an acknowledgment should always require the personal appearance of the 
grantor(s), i.e., the person or persons who have signed the instrument 
to be acknowledged. Since the officer states in his certificate that the 
parties did personally appear before him, failure to observe this 
requirement invalidates the notarial act and makes the officer liable to 
the charge of negligence and of having executed a false certificate. A 
notarizing officer should never take an acknowledgment by telephone.
    (c) Satisfactory identification of grantor(s). The notarizing 
officer must be certain of the identity of the parties making an 
acknowledgment. If he is not personally acquainted with the parties, he 
should require from each some evidence of identity, such as a passport, 
police identity card, or the like. The laws of some States and 
Territories require that the identity of an acknowledger be proved by 
the oath of one or more ``credible witnesses'', and that a statement 
regarding the proving of identity in this manner be included in the 
certificate of acknowledgment. (See Sec. 92.32(b) regarding forms of 
certificates of acknowledgment generally.) Mere introduction of a person 
not known to the notarizing officer, without further proof of identity, 
is not considered adequate identification for acknowledgment purposes.

[[Page 294]]

    (d) Explanation of contents of instrument. The notarizing officer 
must assure himself that the person acknowledging an instrument 
understands the nature of the instrument. If the person does not 
understand it, the officer is legally and morally bound to explain the 
instrument in such a way as to make the person who has signed it realize 
the character and effect of his act. This duty is particularly important 
where the signer of a document has little or no knowledge of the 
language in which the document is written.
    (e) Acknowledgments of married women. Some of the States still 
require that a married woman who has executed an instrument of 
conveyance jointly with her husband be examined separately by the 
notarizing officer at the time the acknowledgments of the couple are 
taken. Notarizing officers should consult the applicable statutory 
provisions before taking the acknowledgments of a husband and wife to a 
document which they have both executed.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51722 and 51723, Oct. 
3, 1995]



Sec. 92.32  Notarial certificate to acknowledgment.

    (a) Title. The notarial certificate evidencing the taking of an 
acknowledgment is commonly known as a ``certificate of acknowledgment'' 
or sometimes simply as an ``acknowledgment.''
    (b) Form. The form of a certificate of acknowledgment varies widely 
depending on the laws of the jurisdiction where the acknowledged 
document is intended to be used, the purpose for which the document is 
intended, and the legal position of the persons who have executed it. 
Instruments to be acknowledged are frequently prepared on printed forms, 
the entire contract or deed being on one sheet together with the 
certificate of acknowledgment. Often the document, including the 
certificate of acknowledgment, is drawn up in advance by an attorney. In 
these cases, the notarizing officer may use the certificate which is 
already on the document, making whatever modifications are manifestly 
required to show that the certificate was executed by a notarizing 
officer. However, if he finds it necessary to prepare the certificate of 
acknowledgment, the officer should consult the appropriate reference 
work for guidance as to the proper form. When no prescribed form can be 
found, the officer should use the language in Form FS-88. Certificate of 
Acknowledgment of Execution of an Instrument, inserting the certificate 
immediately at the close of the deed on the last page if space permits, 
or, if a separate sheet is necessary, using the printed Form FS-88 
itself.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.33  Execution of certificate of acknowledgment.

    (a) When certificate should be executed. A notarizing officer should 
execute a certificate of acknowledgment immediately after the parties to 
the instrument have made their acknowledgment. Allowing several days or 
weeks to elapse between the time the acknowledgment is made and the 
certificate executed is undesirable, even though the officer may 
remember the acknowledgment act.
    (b) Venue. The venue must be shown as prescribed in Sec. 92.14.
    (c) Date. The date in the certificate must be the date the 
acknowledgment was made. This is not necessarily the same as the date 
the instrument was executed. In fact, there is no reason why an 
instrument may not be acknowledged a year or more after the date of its 
execution, or at different times and places by various grantors.
    (d) Names of parties. The name or names of the person or persons 
making the acknowledgment should appear in the certificate in the same 
form as they are set out in the acknowledged document, and in the same 
form as their signature on the instrument.
    (e) Additional statements. When executing a certificate of 
acknowledgment on Form FS-88, the notarizing officer may include any 
necessary additional statements in the blank space below the body of the 
certificate.
    (f) Signing and sealing certificate. The certificate of 
acknowledgment shall be signed and sealed as prescribed in Secs. 92.15 
and 92.16.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]

[[Page 295]]



Sec. 92.34  Fastening certificate to instrument.

    The proper place for the certificate of acknowledgment is after the 
signature of the parties to the instrument. If the instrument is a 
printed form, the certificate will almost invariably be a part of the 
form. When Form FS-88 is used or when the certificate must be prepared 
on a sheet separate from the instrument, it should be fastened to the 
instrument as the last sheet. The method of fastening notarial 
certificates is prescribed in Sec. 92.17.



Sec. 92.35  Errors in certificate of acknowledgment.

    A notarizing officer having taken an acknowledgment of an instrument 
and made a certificate of that fact cannot afterwards amend or change 
his certificate for the purpose of correcting a mistake. This can be 
done only by the parties reacknowledging the instrument. However, 
typographical errors may be corrected by striking out the erroneous 
characters and inserting the correct ones above. Such changes should be 
initiated by the parties who executed the instrument and by the 
notarizing officer.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.36  Authentication defined.

    An authentication is a certification of the genuineness of the 
official character, i.e., signature and seal, or position of a foreign 
official. It is an act done with the intention of causing a document 
which has been executed or issued in one jurisdiction to be recognized 
in another jurisdiction. Documents which may require authentication 
include legal instruments notarized by foreign notaries or other 
officials, and copies of public records, such as birth, death, and 
marriage certificates, issued by foreign record keepers.



Sec. 92.37  Authentication procedure.

    (a) The consular officer must compare the foreign official's seal 
and signature on the document he is asked to authenticate with a 
specimen of the same official's seal and signature on file either in the 
Foreign Service office or in a foreign public office to which he has 
access. If no specimen is available to the consular officer, he should 
require that each signature and seal be authenticated by some higher 
official or officials of the foreign government until there appears on 
the document a seal and signature which he can compare with a specimen 
available to him. However, this procedure of having a document 
authenticated by a series of foreign officials should be followed only 
where unusual circumstances, or the laws or regulations of the foreign 
country require it.
    (b) Where the State law requires the consular officer's certificate 
of authentication to show that the foreign official is empowered to 
perform a particular act, such as administering an oath or taking an 
acknowledgment, the consular officer must verify the fact that the 
foreign official is so empowered.
    (c) When the consular officer has satisfactorily identified the 
foreign seal and signature (and, where required, has verified the 
authority of the foreign official to perform a particular act), he may 
then execute a certificate of authentication, either placing this 
certificate on the document itself if space is available, or appending 
it to the document on a separate sheet (see Sec. 92.17 on the fastening 
of notarial certificates).



Sec. 92.38  Forms of certificate of authentication.

    The form of a certificate of authentication depends on the statutory 
requirements of the jurisdiction where the authenticated document will 
be used (see Sec. 92.39 regarding the provisions of Federal law). Before 
authenticating a document for use in a State or Territory of the United 
States, a consular officer should consult the pertinent law digest to 
ascertain what specific requirements must be met, or he should be guided 
by any special information he may receive from the attorney or other 
person requesting the document with regard to the applicable statutory 
requirements. (See Sec. 92.41(e) regarding material which should not be 
in the certificate of authentication.) If no provisions relating to 
authentications can be found in a particular State or Territorial law 
digest, and in the absence of any special information from

[[Page 296]]

the attorney or other person requesting the document, the officer should 
prepare the certificate of authentication in the form which seems best 
suited to the needs of the case. When in his opinion the circumstances 
seem to warrant, and always in connection with certificates of marriage 
or divorce decrees, a consular officer should include in the body of his 
certificate of authentication a qualifying statement reading as follows: 
``For the contents of the annexed document I assume no responsibility.''



Sec. 92.39  Authenticating foreign public documents (Federal procedures).

    (a) A copy of a foreign public document intended to be used as 
evidence within the jurisdiction of the Federal Government of the United 
States must be authenticated in accordance with the provisions of 
section 1 of the act of June 25, 1948, as amended (sec. 1, 62 Stat. 948, 
sec. 92(b), 63 Stat. 103; 28 U.S.C. 1741). This provision of Federal law 
provides that a copy of any foreign document of record, or on file in a 
public office of a foreign country or political subdivision thereof, if 
certified, by the lawful custodian thereof, may be admitted in evidence 
when authenticated by a certificate of a United States consular officer 
resident in the foreign country, under the seal of his office.
    (b) The consular officer's certificate should indicate that the copy 
has been certified by the lawful custodian.
    (c) In the absence of a consular officer of the United States as an 
officer resident in the State of the Vatican City, a copy of any 
document of record or on file in a public office of said State of the 
Vatican City, certified by the lawful custodian of such document may be 
authenticated by a consular officer of the United States resident in 
Rome, Italy (22 U.S.C. 1204).



Sec. 92.40  Authentication of foreign extradition papers.

    Foreign extradition papers are authenticated by chiefs of mission.



Sec. 92.41  Limitations to be observed in authenticating documents.

    (a) Unknown seals and signatures. A consular officer should not 
authenticate a seal and signature not known to him. See Sec. 92.37(a) 
regarding the necessity for making a comparison with a specimen seal and 
signature.
    (b) Foreign officials outside consular district. A consular officer 
should not authenticate the seals and signatures of foreign officials 
outside his consular district.
    (c) Officials in the United States. Consular officers are not 
competent to authenticate the seals and signatures of notaries public or 
other officials in the United States. However, diplomatic and consular 
officers stationed at a United States diplomatic mission may certify to 
the seal of the Department of State (not the signature of the Secretary 
of State) if this is requested or required in particular cases by the 
national authorities of the foreign country.
    (d) Photostat copies. Consular officers should not authenticate 
facsimiles of signatures and seals on photographic reproductions of 
documents. They may, however, authenticate original signatures and seals 
on such photographic reproductions.
    (e) Matters outside consular officer's knowledge. A consular officer 
should not include in his certificate of authentication statements which 
are not within his power or knowledge to make. Since consular officers 
are not expected to be familiar with the provisions of foreign law, 
except in a general sense, they are especially cautioned not to certify 
that a document has been executed or certified in accordance with 
foreign law, nor to certify that a document is a valid document in a 
foreign country.
    (f) United States officials in foreign countries. An authentication 
by a United States consular officer is performed primarily to cause the 
official characters and positions of foreign officials to be known and 
recognized in the United States. Consular officers should not, 
therefore, undertake to authenticate the seals and signatures of other 
United States officials who may be residing in their consular districts.
    (g) Officers of the Foreign Service in other countries. An officer 
of the Foreign Service stationed in one country

[[Page 297]]

is not expected to authenticate the signature or seal of an officer of 
the Foreign Service stationed in another country. When it is necessary 
for the seal and signature of an officer of the Foreign Service to be 
authenticated, such authentication will be done in the Department of 
State. An official of a foreign government requesting the authentication 
of the seal and signature of an officer of the United States Foreign 
Service who is, or was, stationed in another country should be informed 
that the document to be authenticated will have to be sent to the 
Department for this purpose. Any document bearing the seal and signature 
of an officer of the Foreign Service which is received at a Foreign 
Service post from a person in the United States with the request that it 
be further authenticated should be referred to the Department of State.



Sec. 92.42  Certification of copies of foreign records relating to land titles.

    In certifying documents of the kind described in title 28, section 
1742, of the United States Code, diplomatic and consular officers of the 
United States will conform to the Federal procedures for authenticating 
foreign public documents (Sec. 92.39), unless otherwise instructed in a 
specific case.



Sec. 92.43  Fees for notarial services and authentications.

    The fees for administering an oath or affirmation and making a 
certificate thereof, for the taking of an acknowledgment of the 
execution of a document and executing a certificate thereof, for 
certifying to the correctness of a copy of or an extract from a 
document, official or private, for authenticating a foreign document, or 
for the noting of a bill of exchange, certifying to protest, etc., are 
as prescribed under the caption Documentary services in the Schedule of 
Fees (Sec. 22.1 of this chapter), unless the service is performed under 
a ``no fee'' item of the same caption of the Schedule. If an oath or 
affirmation is administered concurrently to several persons and only one 
consular certificate (jurat) is executed, only one fee is collectible. 
If more than one person joins in making an acknowledgment but only one 
certificate is executed, only one fee shall be charged.
[22 FR 10858, Dec. 27, 1957, as amended at 63 FR 6480, Feb. 9, 1998]

                    Depositions and Letters Rogatory



Sec. 92.49  Deposition defined.

    A deposition is the testimony of a witness taken in writing under 
oath or affirmation, before some designated or appointed person or 
officer, in answer to interrogatories, oral or written. (For the 
distinction between a deposition and an affidavit see Sec. 92.22.)



Sec. 92.50  Use of depositions in court actions.

    Generally depositions may be taken and used in all civil actions or 
suits. In criminal cases in the United States, a deposition cannot be 
used, unless a statute has been enacted which permits a defendant in a 
criminal case to have a deposition taken in his own behalf, or unless 
the defendant consents to the taking of a deposition by the State for 
use by the prosecution. (For exception in connection with the proving of 
foreign documents for use in criminal actions, see Sec. 92.65.)



Sec. 92.51  Methods of taking depositions in foreign countries.

    Rule 28(b) of the Rules of Civil Procedure for the District Courts 
of the United States provides that depositions may be taken in foreign 
countries by any of the following four methods:
    (a) Pursuant to any applicable treaty or convention, or
    (b) Pursuant to a letter of request (whether or not captioned a 
letter rogatory), or
    (c) On notice before a person authorized to administer oaths in the 
place in which the examination is held, either by the law thereof or by 
the law of the United States. Notarizing officials as defined by 22 CFR 
92.1 are so authorized by the law of the United States, or
    (d) Before a person commissioned by the court, and a person so 
commissioned shall have the power by virtue of the commission to 
administer any necessary oath and take testimony.
[60 FR 51722, Oct. 3, 1995]

[[Page 298]]



Sec. 92.52  ``Deposition on notice'' defined.

    A deposition on notice is a deposition taken before a competent 
official after reasonable notice has been given in writing by the party 
or attorney proposing to take such deposition to the opposing party or 
attorney of record. Notarizing officers, as defined by 22 CFR 92.1, are 
competent officials for taking depositions on notice in foreign 
countries (see Sec. 92.51). This method of taking a deposition does not 
necessarily involve the issuance of a commission or other court order.
[60 FR 51722, Oct. 3, 1995]



Sec. 92.53  ``Commission to take depositions'' defined.

    A commission to take depositions is a written authority issued by a 
court of justice, or by a quasi-judicial body, or a body acting in such 
capacity, giving power to take the testimony of witnesses who cannot 
appear personally to be examined in the court or before the body issuing 
the commission. In Federal practice, a commission to take depositions is 
issued only when necessary or convenient, on application and notice. The 
commission indicates the action or hearing in which the depositions are 
intended to be used, and the person or persons required to take the 
depositions, usually by name or descriptive title (see Sec. 92.55 for 
manner of designating notarizing officers). Normally a commission is 
accompanied by detailed instructions for its execution.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.54  ``Letters rogatory'' defined.

    In its broader sense in international practice, the term letters 
rogatory denotes a formal request from a court in which an action is 
pending, to a foreign court to perform some judicial act. Examples are 
requests for the taking of evidence, the serving of a summons, subpoena, 
or other legal notice, or the execution of a civil judgment. In United 
States usage, letters rogatory have been commonly utilized only for the 
purpose of obtaining evidence. Requests rest entirely upon the comity of 
courts toward each other, and customarily embody a promise of 
reciprocity. The legal sufficiency of documents executed in foreign 
countries for use in judicial proceedings in the United States, and the 
validity of the execution, are matters for determination by the 
competent judicial authorities of the American jurisdiction where the 
proceedings are held, subject to the applicable laws of that 
jurisdiction. See Sec. 92.66 for procedures in the use of letters 
rogatory requesting the taking of depositions in foreign jurisdictions.



Sec. 92.55  Consular authority and responsibility for taking depositions.

    (a) Requests to take depositions or designations to execute 
commissions to take depositions. Any United States notarizing officer 
may be requested to take a deposition on notice, or designated to 
execute a commission to take depositions. A commission or notice should, 
if possible, identify the officer who is to take depositions by his 
official title only in the following manner: ``Any notarizing officer of 
the United States of America at (name of locality)''. The notarizing 
officer responsible for the performance of notarial acts at a post 
should act on a request to take a deposition on notice, or should 
execute the commission, when the documents are drawn in this manner, 
provided local law does not preclude such action. However, when the 
officer (or officers) is designated by name as well as by title, only 
the officer (or officers) so designated may take the depositions. In 
either instance, the officer must be a disinterested party. Rule 28(c) 
of the Rules of Civil Procedure for the district courts of the United 
States prohibits the taking of a deposition before a person who is a 
relative, employee, attorney or counsel of any of the parties, or who is 
a relative or employee of such attorney or counsel, or who is 
financially interested in the action.
    (b) Authority in Federal law. The authority for the taking of 
depositions, charging the appropriate fees, and imposing the penalty for 
giving false evidence is generally set forth in 22 U.S.C. 4215 and 4221. 
The taking of depositions for federal courts of the United States is 
further governed by the Federal Rules of Civil Procedure. For the 
provisions of law which govern particularly the taking of depositions to 
prove the

[[Page 299]]

genuineness of foreign documents which it is desired to introduce in 
evidence in any criminal action or proceeding is a United States federal 
court, see 18 U.S.C. 3491 through 3496.
    (c) Procedure where laws of the foreign country do not permit the 
taking of depositions. In countries where the right to take depositions 
is not secured by treaty, notarizing officers may take depositions only 
if the laws or authorities of the national government will permit them 
to do so. Notarizing officers in countries where the taking of 
depositions is not permitted who receive notices or commissions for 
taking depositions should return the documents to the parties from whom 
they are received explaining why they are returning them, and indicating 
what other method or methods may be available for obtaining the 
depositions, whether by letters rogatory or otherwise.
[60 FR 51722, Oct. 3, 1995]



Sec. 92.56  Summary of procedure for taking depositions.

    In taking a deposition on notice or executing a commission to take 
depositions, a notarizing officer should conform to any statutory 
enactments on the subject in the jurisdiction in which the depositions 
will be used. He should also comply with any special instructions which 
accompany the request for a deposition on notice or a commission. Unless 
otherwise directed by statutory enactments or special instructions, the 
officer should proceed as follows in taking depositions:
    (a) Request the witnesses, whose testimony is needed, to appear 
before him; or, at the request of any party to the action or proceeding, 
request designated persons to supply him or the requesting party with 
needed records or documents in their possession, or copies thereof;
    (b) When necessary, act as interpreter or translater, or see that 
arrangements are made for some qualified person to act in this capacity;
    (c) Before the testimony is taken, administer oaths (or affirmations 
in lieu thereof) to the interpreter or translator (if there is one), to 
the stenographer taking down the testimony, and to each witness;
    (d) Have the witnesses examined in accordance with the procedure 
described in Secs. 92.57 to 92.60;
    (e) Either record, or have recorded in his presence and under his 
direction, the testimony of the witnesses;
    (f) Take the testimony, or have it taken, stenographically in 
question-and-answer form and transcribed (see Sec. 92.58) unless the 
parties to the action agree otherwise (rules 30(c) and 31(b), Rules of 
Civil Procedure for the District Courts of the United States);
    (g) Be actually present throughout the examination of the witnesses, 
but recess the examination for reasonable periods of time and for 
sufficient reasons;
    (h) Mark or cause to be marked, by identifying exhibit numbers or 
letters, all documents identified by a witness or counsel and submitted 
for the record.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.57  Oral examination of witnesses.

    When a witness is examined on the basis of oral interrogatories, the 
counsel for the party requesting the deposition has the right to conduct 
a direct examination of the witness without interruption except in the 
form of objection by opposing counsel. The opposing counsel has the same 
right on cross-examination. Cross-examination may be followed by 
redirect and recross-examinations until the interrogation is complete. 
The notarizing officer taking the deposition should endeavor to restrain 
counsel from indulging in lengthy colloquies, digressions, or asides, 
and from attempts to intimidate or mislead the witness. The notarizing 
officer has no authority to sustain or overrule objections but should 
have them recorded as provided in Sec. 92.59. Instead of taking part in 
the oral examination of a witness, the parties notified of the taking of 
a deposition may transmit written interrogatories to the notarizing 
officer. The notarizing officer should then question the witness on the 
basis of the written interrogatories and should record the answers 
verbatim. (Rules 30 (c) and 31

[[Page 300]]

(b), Rules of Civil Procedure for the District Courts of the United 
States.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.58  Examination on basis of written interrogatories.

    Written interrogatories are usually divided into three parts:
    (a) The direct interrogatories or interrogatories in chief;
    (b) The cross-interrogatories; and
    (c) The redirect interrogatories.

Recross-interrogatories sometimes follow redirect interrogatories. The 
notarizing officer should not furnish the witness with a copy of the 
interrogatories in advance of the questioning, nor should he allow the 
witness to examine the interrogatories in advance of the questioning. 
Although it may be necessary for the officer, when communicating with 
the witness for the purpose of asking him to appear to testify, to 
indicate in general terms the nature of the evidence which is being 
sought, this information should not be given in such detail as to permit 
the witness to formulate his answers to the interrogatories prior to his 
appearance before the notarizing officer. The officer taking the 
deposition should put the interrogatories to the witness separately and 
in order. The written interrogatories should not be repeated in the 
record (unless special instructions to that effect are given), but an 
appropriate reference should be made thereto. These references should, 
of course, be followed by the witness' answers. All of the written 
interrogatories must be put to the witness, even though at some point 
during the examination the witness disclaims further knowledge of the 
subject. When counsel for all of the parties attend an examination 
conducted on written interrogatories, the notarizing officer may, all 
counsel having consented thereto, permit oral examination of the witness 
following the close of the examination upon written interrogatories. The 
oral examination should be conducted in the same manner and order as if 
not preceded by an examination upon written interrogatories.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995; 61 
FR 14375, Apr. 1, 1996]



Sec. 92.59  Recording of objections.

    All objections made at the time of the examination to the 
qualifications of the officer taking the deposition, or to the manner of 
taking it, or to the evidence presented, or to the conduct of any party, 
and any other objection to the proceedings must be noted in the 
deposition. Evidence objected to will be taken subject to the 
objections. (Rules 30 (c) and 31 (b), Rules of Civil Procedure for the 
District Courts of the United States.)



Sec. 92.60  Examination procedures.

    (a) Explaining interrogatory to witness. If the witness does not 
understand what an interrogatory means, the notarizing officer should 
explain it to him, if possible, but only so as to get an answer strictly 
responsive to the interrogatory.
    (b) Refreshing memory by reference to written records. A witness may 
be permitted to refresh his memory by referring to notes, papers or 
other documents. The notarizing officer should have such occurrence 
noted in the record of the testimony together with a statement of his 
opinion as to whether the witness was using the notes, papers or other 
documents to refresh his memory or for the sake of testifying to matters 
not then of his personal knowledge.
    (c) Conferring with counsel. When the witness confers with counsel 
before answering any interrogatory, the notarizing officer should have 
that fact noted in the record of the testimony.
    (d) Examining witness as to personal knowledge. The notarizing 
officer may at any time during the examination of a witness propound 
such inquiries as may be necessary to satisfy himself whether the 
witness is testifying from his personal knowledge of the subject matter 
of the examination.
    (e) Witness not to leave officer's presence. The notarizing officer 
should request the witness not to leave his presence during the 
examination, except during the recesses for meals, rest, etc., 
authorized in Sec. 92.56 (g). Failure of the witness to comply with this 
request must be noted in the record.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]

[[Page 301]]



Sec. 92.61  Transcription and signing of record of examination.

    After the examination of a witness is completed, the stenographic 
record of the examination must be fully transcribed and the 
transcription attached securely to any document or documents to which 
the testimony in the record pertains. (See Sec. 92.63 regarding the 
arrangement of papers.) The transcribed deposition must then be 
submitted to the witness for examination and read to or by him, unless 
such examination and reading are waived by the witness and by the 
parties to the action. Any changes in form or substance desired by the 
witness should be entered upon the deposition by the notarizing officer 
with a statement of the reasons given by the witness for making the 
changes. The witness should then sign the transcript of his deposition 
and should initial in the margin each correction made at his request. 
However, the signature and initials of the witness may be omitted if the 
parties to the action by stipulation waive the signing or if the witness 
is ill, refuses to sign, or cannot be found. If the deposition is not 
signed by the witness, the notarizing officer should sign it and should 
state on the record the reason for his action, i.e., the waiver of the 
parties, the illness or absence of the witness, or the refusal of the 
witness to sign, giving the reasons for such refusal. The deposition may 
then be used as though signed by the witness except when, on the motion 
to suppress, the court holds that the reasons given for the refusal to 
sign require the rejection of the deposition in whole or in part. (Rules 
30 (e) and 31 (b), Rules of Civil Procedure for the District Courts of 
the United States.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.62  Captioning and certifying depositions.

    The notarizing officer should prepare a caption for every 
deposition; should certify on the deposition that the witness was duly 
sworn by him and that the deposition is a true record of the testimony 
given by the witness; and should sign and seal the certification in the 
manner prescribed in Secs. 92.15 and 92.16. (Rules 30 (f) (1) and 31 
(b), Rules of Civil Procedures for the District Courts of the United 
States.)
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.63  Arrangement of papers.

    Unless special instructions to the contrary are received, the 
various papers comprising the completed record of the depositions should 
usually be arranged in the following order from bottom to top:
    (a) Commission to take depositions (or notice of taking 
depositions), with interrogatories, exhibits, and other supporting 
documents fastened thereto.
    (b) Statement of fees charged, if one is prepared on a separate 
sheet.
    (c) Record of the responses of the various witnesses, including any 
exhibits the witnesses may submit.
    (d) Closing certificate.

All of these papers should be fastened together with ribbon, the ends of 
which should be secured beneath the notarizing officer's seal affixed to 
the closing certificate.
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.64  Filing depositions.

    (a) Preparation and transmission of envelope. The notice or 
commission, the interrogatories, the record of the witnesses' answers, 
the exhibits, and all other documents and papers pertaining to the 
depositions should be fastened together (see Sec. 92.63 regarding the 
arrangement of papers) and should be enclosed in an envelope sealed with 
the wax engraving seal of the post. The envelope should be endorsed with 
the title of the action and should be marked and addressed. The sealed 
envelope should then be transmitted to the court in which the action is 
pending.
    (b) Furnishing copies. The original completed depositions should not 
be sent to any of the parties to the action or to their counsel. 
However, the notarizing officer may furnish a copy of a deposition to 
the deponent or to any party to the action upon the payment of the 
copying fee and if certification is desired under official seal that the 
copy is a true copy, the certification

[[Page 302]]

fee prescribed in the Tariff of Fees, Foreign Service of the United 
States of America (Sec. 22.1 of this chapter).
[22 FR 10858, Dec. 27, 1957, as amended at 60 FR 51723, Oct. 3, 1995]



Sec. 92.65  Depositions to prove genuineness of foreign documents.

    (a) Authority to execute commission. Under the provisions of section 
1 of the act of June 25, 1948, as amended (sec. 1, 62 Stat. 834, sec. 
53, 63 Stat. 96; 18 U.S.C. 3492), a diplomatic or consular officer may 
be commissioned by an United States court to take the testimony of a 
witness in a foreign country either on oral or written interrogatories, 
or partly on oral and partly on written interrogatories, for the purpose 
of determining the genuineness of any foreign document (any book, paper, 
statement, record, account, writing, or other document, or any portion 
thereof, of whatever character and in whatever form, as well as any copy 
thereof equally with the original, which is not in the United States) 
which it is desired to introduce in evidence in any criminal action or 
proceeding in any United States court under the provisions of section 1 
of the act of June 25, 1948 (sec. 1, 62 Stat. 945; 28 U.S.C. 1732). Such 
testimony may also be taken to determine whether the foreign document 
was made in the regular course of business and whether it was the 
regular course of business to make such document. The term ``business'' 
includes business, profession, occupation, and calling of every kind. 
(Sec. 1, 62 Stat. 945, 28 U.S.C. 1732.)
    (b) Disqualification to execute commission. Any diplomatic or 
consular officer to whom a commission is addressed to take testimony, 
who is interested in the outcome of the criminal action or proceeding in 
which the foreign documents in question are intended to be used or who 
has participated in the prosecution of such action or proceeding, 
whether by investigations, preparation of evidence, or otherwise, may be 
disqualified on his own motion or on that of the United States or any 
other party to such criminal action or proceeding made to the court from 
which the commission issued at any time prior to the execution thereof. 
If, after notice and hearing, the court grants the motion, it will 
instruct the diplomatic or consular officer thus disqualified to send 
the commission to any other diplomatic or consular officer of the United 
States named by the court, and such other officer should execute the 
commission according to its terms and will for all purposes be deemed 
the officer to whom the commission is addressed. (Section 1, 62 Stat. 
834, sec. 53, 63 Stat. 96; 18 U.S.C. 3492.)
    (c) Execution and return of commission. (1) Commissions issued in 
criminal cases under the authority of the act of June 25, 1948, as 
amended, to take testimony in connection with foreign documents should 
be executed and returned by officers of the Foreign Service in 
accordance with section 1 of that act, as amended (sec. l, 62 Stat. 835; 
18 U.S.C. 3493, 3494), and in accordance with any special instructions 
which may accompany the commission. For details not covered by such 
section or by special instructions, officers of the Foreign Service 
should be guided by such instructions as may be issued by the Department 
of State in connection with the taking of depositions generally. (See 
Secs. 92.55 to 92.64.)
    (2) Section 1 of the act of June 25, 1948 (sec. 1, 62 Stat. 835; 18 
U.S.C. 3493) provides that every person whose testimony is taken should 
be cautioned and sworn to testify the whole truth and should be 
carefully examined. The testimony should be reduced to writing or 
typewriting by the consular officer, or by some person under his 
personal supervision, or by the witness himself in the presence of the 
consular officer, and by no other person. After it has been reduced to 
writing or typewriting, the testimony must be signed by the witness. 
Every foreign document with respect to which testimony is taken must be 
annexed to such testimony and must be signed by each witness who appears 
for the purpose of establishing the genuineness of such document.
    (3) When counsel for all of the parties attend the examination of 
any witness whose testimony will be taken on written interrogatories, 
they may consent that oral interrogatories, in addition to those 
accompanying the commission, be put to the witness. The consular officer 
taking the testimony should require an interpreter to be

[[Page 303]]

present when his services are needed or are requested by any party or 
his attorney. (Section 1, 62 Stat. 835, 18 U.S.C. 3493.)
    (4) Section 1 of the act of June 25, 1948 (sec. 1, 62 Stat. 835; 18 
U.S.C. 3494) provides that the consular officer, who executes any 
commission authorized under the same section, as amended (sec. 1, 62 
Stat. 834, sec. 53, 63 Stat. 96; 18 U.S.C. 3492) and who is satisfied, 
upon all the testimony taken, that a foreign document is genuine, should 
certify such document to be genuine under the seal of his office. This 
certification must include a statement that the officer is not subject 
to disqualification under the provisions of section 1 of the act of June 
25, 1948, as amended (sec. 1, 62 Stat. 834, sec. 53, 63 Stat. 96; 18 
U.S.C. 3492). For purposes of assessment of fees, the issuance of this 
certificate shall be regarded as a part of the consular service of 
executing the commission, and no separate fee shall be charged for the 
certificate.
    (5) The consular officer should then forward such foreign documents, 
together with the record of all testimony taken and the commission which 
has been executed, to the Department of State for transmission to the 
clerk of the court from which the commission issued. (Section 1, 62 
Stat. 835; 18 U.S.C. 3494.) (See Sec. 92.64 regarding the filing of 
depositions generally.)

(Sec. 303, 60 Stat. 1002, 62 Stat. 836; 22 U.S.C. 843, 18 U.S.C. 3496, 
E.O. 10307; 16 FR 11907, 3 CFR 1949-1953 Comp., page 387)



Sec. 92.66  Depositions taken before foreign officials or other persons in a foreign country.

    (a) Customary practice. Under Federal law (Rule 28(b), Rules of 
Civil Procedure for the District Courts of the United States) and under 
the laws of some of the States, a commission to take depositions can be 
issued to a foreign official or to a private person in a foreign 
country. However, this method is rarely used; commissions are generally 
issued to U.S. notarizing officers. In those countries where U.S. 
notarizing officers are not permitted to take testimony (see 
Sec. 92.55(c)) and where depositions must be taken before a foreign 
authority, letters rogatory are usually issued to a foreign court.
    (b) Transmission of letters rogatory to foreign officials. Letters 
rogatory may often be sent direct from court to court. However, some 
foreign governments require that these requests for judicial aid be 
submitted through the diplomatic channel (i.e., that they be submitted 
to the Ministry for Foreign Affairs by the American diplomatic 
representative). A usual requirement is that the letters rogatory as 
well as the interrogatories and other papers included with them be 
accompanied by a complete translation into the language (or into one of 
the languages) of the country of execution. Another requirement is that 
provision be made for the payment of fees and expenses. Inquiries from 
interested parties or their attorneys, or from American courts, as to 
customary procedural requirements in given countries, may be addressed 
direct to the respective American embassies and legations in foreign 
capitals, or to the Department of State, Washington, DC 20520.
    (c) Return of letters rogatory executed by foreign officials. (1) 
Letters rogatory executed by foreign officials are returned through the 
same channel by which they were initially transmitted. When such 
documents are returned to a United States diplomatic mission, the 
responsible officer should endorse thereon a certificate stating the 
date and place of their receipt. This certificate should be appended to 
the documents as a separate sheet. The officer should then enclose the 
documents in an envelope sealed with the wax engraving seal of the post 
and bearing an endorsement indicating the title of the action to which 
the letters rogatory pertain. The name and address of the American 
judicial body from which the letters rogatory issued should also be 
placed on the envelope.
    (2) If the executed letters rogatory are returned to the diplomatic 
mission from the Foreign Office in an envelope bearing the seals of the 
foreign judicial authority who took the testimony, that sealed envelope 
should not be opened at the mission. The responsible officer should 
place a certificate on the envelope showing the date it was received at 
his office and indicating that

[[Page 304]]

it is being forwarded in the same condition as received from the foreign 
authorities. He should then place that sealed envelope in a second 
envelope, sealed with the wax engraving seal of the post, and bearing 
the title of the action and the name and address of the American 
judicial body from which the letters rogatory issued.
    (3) Charges should be made for executing either of the certificates 
mentioned in paragraphs (c) (1) and (2) of this section, as prescribed 
by item 67 of the Tariff of Fees, Foreign Service of the United States 
of America (Sec. 22.1 of this chapter), unless the service is 
classifiable in a no-fee category under the exemption for Federal 
agencies and corporations (item 83 of the same Tariff).
    (4) The sealed letters rogatory should be transmitted by appropriate 
means to the court in which the action is pending. See title 28, section 
1781, of the United States Code concerning the manner of making return 
to a court of the United States (Federal court).
    (d) Transmissions of commissions to foreign officials or other 
persons. A commission to take depositions which is addressed to an 
official or person in a foreign country other than a United States 
notarizing officer may be sent directly to the person designated. 
However, if such a commission is sent to the United States diplomatic 
mission in the country where the depositions are intended to be taken, 
it should be forwarded to the Foreign Office for transmission to the 
person appointed in the commission. If sent to a United States consular 
office, the commission may be forwarded by that office directly to the 
person designated, or, if the notarial officer deems it more advisable 
to do so, he may send the commission to the United States diplomatic 
mission for transmission through the medium of the foreign office.
[22 FR 10858, Dec. 27, 1957, as amended at 32 FR 11775, Aug. 16, 1967; 
60 FR 51722, Oct. 3, 1995]



Sec. 92.67  Taking of depositions in United States pursuant to foreign letters rogatory.

    (a) Authority and procedure. The taking of depositions by authority 
of State courts for use in the courts of foreign countries is governed 
by the laws of the individual States. As respects Federal practice, the 
district court of the district in which a person resides or is found may 
order him to give his testimony or statement or to produce a document or 
other thing for use in a proceeding in a foreign or international 
tribunal. The order may be made pursuant to a letter rogatory issued, or 
request made, by a foreign or international tribunal or upon the 
application of any interested person and may direct that the testimony 
or statement be given, or the document or other thing be produced, 
before a person appointed by the court. By virtue of his appointment, 
the person appointed has power to administer any necessary oath and take 
the testimony or statement. The order may prescribe the practice and 
procedure, which may be in whole or part the practice and procedure of 
the foreign country or the interntational tribunal, for taking the 
testimony or statement or producing the document or other thing. To the 
extent that the order does not prescribe otherwise, the testimony or 
statement shall be taken, and the document or other thing produced, in 
accordance with the Federal Rules of Civil Procedure. A person may not 
be compelled to give his testimony or statement or to produce a document 
or other thing in violation of any legally applicable privilege. This 
does not preclude a person within the United States from voluntarily 
giving his testimony or statement, or producing a document or other 
thing, for use in a proceeding in a foreign or international tribunal 
before any person or in any manner acceptable to him (28 U.S.C. 1782).
    (b) Formulation of letters rogatory. A letter rogatory customarily 
states the nature of the judicial assistance sought by the originating 
court, prays that this assistance be extended, incorporates an 
undertaking of future reciprocity in like circumstances, and makes some 
provision for payment of fees and costs entailed in its execution. As 
respects Federal practice, it is not

[[Page 305]]

required that a letter rogatory emanating from a foreign court be 
authenticated by a diplomatic or consular officer of the United States 
or that it be submitted through the diplomatic channel; the seal of the 
originating court suffices. When testimony is desired, the letter 
rogatory should state whether it is intended to be taken upon oral or 
written interrogatories. If the party on whose behalf the testimony is 
intended to be taken will not be represented by counsel, written 
interrogatories should be attached. Except where manifestly unneeded 
(e.g. a Spanish-language letter rogatory intended for execution in 
Puerto Rico) or dispensed with by arrangement with the court, letters 
rogatory and interrogatories in a foreign language should be accompanied 
by English translations.
    (c) Addressing letters rogatory. To avert uncertainties and minimize 
possibilities for refusal of courts to comply with requests contained in 
letters rogatory in the form in which they are presented, it is 
advisable that counsel for the parties in whose behalf testimony is 
sought ascertain in advance if possible, with the assistance of 
correspondent counsel in the United States or that of a consular 
representative or agent of his nation in the United States, the exact 
title of the court, Federal or State as the case may be, which will be 
prepared to entertain the letter rogatory. In Federal practice the 
following form of address is acceptable:

    The U.S. District Court for the ------ ---------------- (e.g. 
Northern, Southern) District of -------------------- (State) ----------
---------- (City) ------------------, (State)


In instances where it is not feasible to ascertain the correct form of 
address at the time of preparation of the letter rogatory, and it will 
be left for counsel in the United States, or a consul or agent in the 
United States of the nation of origin of the letter rogatory to effect 
its transmission to an appropriate court, the following form may be 
used: ``To the Appropriate Judicial Authority at (name of locality).''
    (d) Submitting letters rogatory to courts in the United States. A 
letter rogatory may be submitted to the clerk of the court of which 
assistance is sought, either in person or by mail. This may be direct by 
international mail from the originating foreign court. Alternatively, 
submission to the clerk of court may be effected in person or by mail by 
any party to the action at law or his attorney or agent, or by a 
consular officer or agent in the United States of the foreign national 
concerned. Finally, the Department of State has been authorized (62 
Stat. 949; 28 U.S.C. 1781) to receive a letter rogatory issued, or 
request made, by a foreign or international tribunal, to transmit it to 
the tribunal, officer, or agency in the United States to whom it is 
addressed, and to receive and return it after execution. This 
authorization does not preclude--
    (1) The transmittal of a letter rogatory or request directly from a 
foreign or international tribunal to the tribunal, officer, or agency in 
the United States to whom it is addressed and its return in the same 
manner; or
    (2) The transmittal of a letter rogatory or request directly from a 
tribunal in the United States to the foreign or international tribunal, 
officer, or agency to whom it is addressed and its return in the same 
manner.
[32 FR 11775, Aug. 16, 1967]



Sec. 92.68  Foreign Service fees and incidental costs in the taking of evidence.

    The fees for the taking of evidence by officers of the Foreign 
Service are as prescribed by the Tariff or Fees, Foreign Service of the 
United States of America (Sec. 22.1 of this chapter), under the caption 
``Services Relating to the Taking of Evidence,'' unless the service is 
performed for official use, which comes under the caption ``Exemption 
for Federal Agencies and Corporations'' of the same Tariff. See 
Sec. 22.6 of this chapter concerning the requirement for advance deposit 
of estimated fees. When the party on whose behalf the evidence is sought 
or his local representative is not present to effect direct payment of 
such incidental costs as postage or travel of witnesses, the advance 
deposit required by the officer shall be in an amount estimated as 
sufficient to cover these in addition to the fees proper. The same rule 
shall apply

[[Page 306]]

to charges for interpreting or for the taking and transcribing of a 
stenographic record when performed commercially rather than by staff 
members at Tariff of Fee rates.



Sec. 92.69  Charges payable to foreign officials, witnesses, foreign counsel, and interpreters.

    (a) Execution of letters rogatory by foreign officials. Procedures 
for payment of foreign costs will be by arrangement with the foreign 
authorities.
    (b) Execution of commissions by foreign officials or other persons 
abroad. Procedure for the payment of foreign costs will be as arranged, 
by the tribunal requiring the evidence, with its commissioner.
    (c) Witness fees and allowances when depositions are taken pursuant 
to commission from a Federal court. A witness attending in any court of 
the United States, or before a United States commissioner, or before any 
person authorized to take his deposition pursuant to any rule or order 
of a cut of the United States, shall receive $4 for each day's 
attendance and for the time necessarily occupied in going to and 
returning from the same, and 8 cents per mile for going from and 
returning to his place of residence. Witnesses who are not salaried 
employees of the Government and who are not in custody and who attend at 
points so far removed from their respective residence as to prohibit 
return thereto from day to day shall be entitled to an additional 
allowance of $8 per day for expenses of subsistence, including the time 
necessarily occupied in going to and returning from the place of 
attendance (28 U.S.C. 1821, Supp. IV). Witnesses giving depositions 
before consular officers pursuant to a commission issued by the Federal 
Court are entitled to these fees and allowances, and the officer shall 
make payment thereof in the same manner as payment is made of other 
expenses involved in the execution of the commission, charging the 
advance deposit provided by the party at whose request the depositions 
are taken (see Sec. 92.68). In any case to which the Government of the 
United States, or an officer or agency thereof, is a party, the United 
States marshal for the district will pay all fees of witnesses on the 
certificate of the United States Attorney or Assistant United States 
Attorney, and in the proceedings before a United States Commissioner, on 
the certificate of such commissioner (28 U.S.C. 1825).



Sec. 92.70  Special fees for depositions in connection with foreign documents.

    (a) Fees payable to witnesses. Each witness whose testimony is 
obtained under a commission to take testimony in connection wtih foreign 
documents for use in criminal cases shall be entitled to receive 
compensation at the rate of $15 a day for each day of attendance, plus 8 
cents a mile for going from his place of residence or business to the 
place of examination, and returning, by the shortest feasible route (18 
U.S.C. 3495 and 3496, and E.O. 10307, 3 CFR, 1949-1953 Comp.). When, 
however it is necessary to procure the attendance of a witness on behalf 
of the United States or an indigent party, an officer or agent of the 
United States may negotiate with the witness to pay compensation at such 
higher rate as may be approved by the Attorney General, plus the mileage 
allowance stated above (5 U.S.C. 341). The expense of the compensation 
and mileage of each witness will be borne by the party, or parties, 
applying for the commission unless the commission is accompanied by an 
order of court (18 U.S.C. 3495(b) that all fees, compensations, and 
other expenses authorized by these regulations are chargeable to the 
United States (18 U.S.C. 3495).
    (b) Fee payable to counsel. Each counsel who represents a party to 
the action or proceeding in the examination before the commissioner will 
receive compensation for each day of attendance at a rate of not less 
than $15 a day and not more than $50 a day, as agreed between him and 
the party whom he represents, plus such actual and necessary expenses as 
may be allowed by the commissioner upon verified statements filed with 
him. If the commission is issued on application of the United States, 
the compensation and expenses of counsel representing each party are 
chargeable to the United States under section 3495(b) of title 18 of the 
United States Code (18 U.S.C.

[[Page 307]]

3495 and 3496, and E.O. 10307, 3 CFR, 1949-1953 Comp.).
    (c) Fees payable to interpreters and translators. Each interpreter 
and translator employed by the commissioner under these regulations 
shall receive an allowance of $10 a day, plus 8 cents a mile for going 
from his place of residence or business to the place of examination and 
returning, by the shortest feasible route. The compensation and mileage 
of interpreters and translators shall be chargeable to the United 
States.
    (d) Time for paying fees. Witnesses, counsel, interpreters, and 
translators will be paid, in accordance with the foregoing regulations, 
by the commissioner at the conclusion of their services. Other expenses 
authorized by these regulations will be paid by the commissioner as they 
are incurred.
    (e) Payment of fees by the United States. When it appears that the 
commission was issued on application of the United States or when the 
commission is accompanied by an order of court that all fees, 
compensation, and other expenses authorized by these regulations are 
chargeable to the United States under section 3495(b) of title 18 of the 
United States Code, the commissioner shall execute the commission 
without charge for his service as commissioner in connection therewith. 
The Commissioner shall pay witnesses, counsel, interpreter, or 
translator, and other expenses authorized by these regulations through 
the disbursing officer in his area in accordance with instructions which 
will be issued in each case.
    (f) Payment of fees by other parties. When fees, compensation, and 
other expenses authorized by this section are chargeable to any party 
other than the United States, the commissioner shall undertake the 
execution of the commission only if such party deposits with the 
Department of State or with the appropriate Foreign Service post, in 
advance, an amount to be set by the court as apparently adequate to 
defray all fees, compensation, and other expenses authorized by this 
part. If the amount of the deposit is later found to be insufficient, 
the depositor shall be so notified, and the commissioner shall retain 
the commission and other papers until a sufficient supplemental amount 
has been deposited. If the amount of the deposit exceeds the aggregate 
amount of fees, compensation, and other expenses authorized by this 
part, the excess shall be returned to the party, or parties, entitled 
thereto. The commissioner shall pay witnesses, counsel, interpreter, or 
translator, and other expenses authorized by this section, from the 
proceeds of a check which the disbursing officer for his area will be 
authorized to draw on the Treasurer of the United States.



Sec. 92.71  Fees for letters rogatory executed by officials in the United States.

    Arrangements for the payment of fees should be made directly with 
the court in the United States by the party in the foreign country at 
whose request the depositions are taken, either through his legal 
representative in the United States or through the appropriate 
diplomatic or consular officer of his country in the United States. (See 
Sec. 92.67 regarding the execution of letters rogatory in the United 
States.)

                     Miscellaneous Notarial Services



Sec. 92.72  Services in connection with patents and patent applications.

    (a) Affidavit of applicant. The form of the affidavit of an 
applicant for a United States patent depends on who is making the 
application, the type of invention, and the circumstances of the case. 
Officers of the Foreign Service are not responsible for the correctness 
of form of such affidavits, and should not endeavor to advise in their 
preparation. Persons who inquire at a Foreign Service post regarding the 
filing of patent applications may be referred to the pamphlet entitled 
``General Information Concerning Patents,'' if copies thereof are 
available at the post.
    (b) Oath or affirmation of applicant--(1) Authority to administer 
oath or affirmation. When an applicant for a patent resides in a foreign 
country, his oath or affirmation may be made before any diplomatic or 
consular officer of the United States authorized to administer oaths, or 
before any officer having an official seal and authorized to administer 
oaths in the foreign country in which the applicant may be, whose 
authority shall be proved by certificate of

[[Page 308]]

a diplomatic or consular officer of the United States (35 U.S.C. 115). 
See paragraph (c) of this section regarding authentication of the 
authority of a foreign official. A notary or other official in a foreign 
country who is not authorized to administer oaths is not qualified to 
notarize an application for a United States patent.
    (2) Form of oath or affirmation. See Secs. 92.19 and 92.20 for usual 
forms of oaths and affirmations.
    (3) Execution of jurat. In executing the jurat, the officer should 
carefully observe the following direction with regard to ribboning and 
sealing: When the oath is taken before an officer in a country foreign 
to the United States, all the application papers, except the drawings, 
must be attached together and a ribbon passed one or more times through 
all the sheets of the application, except the drawings, and the ends of 
said ribbon brought together under the seal before the latter is affixed 
and impressed, or each sheet must be impressed with the official seal of 
the officer before whom the oath is taken. If the papers as filed are 
not properly ribboned or each sheet impressed with the seal, the case 
will be accepted for examination but before it is allowed, duplicate 
papers, prepared in compliance with the foregoing sentence, must be 
filed. (Rule 66, Rules of Practice of the United States Patent Office.)
    (c) Authentication of authority of foreign official--(1) Necessity 
for authentication. When the affidavit required in connection with a 
patent application been sworn to or affirmed before an official in a 
foreign country other than a diplomatic or consular officer of the 
United States, an officer of the Foreign Service authenticate the 
authority of the official administering the oath or affirmation (35 
U.S.C. 115). If the officer of the Foreign Service cannot authenticate 
the oath or affirmation, the document should be authenticated by a 
superior foreign official, or by a series of superior foreign officials 
if necessary. The seal and signature of the foreign official who affixes 
the last foreign authentication to the document should then be 
authenticated by the officer of the Foreign Service.
    (2) Use of permanent ink. All papers which will become a part of a 
patent application filed in the United States Patent Office must be 
legibly written or printed in permanent ink. (Rule 52, Rules of Practice 
of the United States Patent Office.) Consular certificates of 
authentication executed in connection with patent applications should 
preferably be prepared on a typewriter; they should not be prepared on a 
hectograph machine.
    (d) Authority of a foreign executor or administrator acting for 
deceased inventor. Legal representatives of deceased inventors and of 
those under legal incapacity may make application for patent upon 
compliance with the requirements and on the same terms and conditions 
applicable to the inventor (35 U.S.C. 117). The rules of the Patent 
Office require proof of the power or authority of the legal 
representative. See paragraph (c) of this section for procedure for 
authenticating the authority of a foreign official.
    (e) Assignments of patents and applications for patents. An 
application for a patent, or a patent, or any interest therein, may be 
assigned in law by an instrument in writing. The applicant, or the 
patentee, or his assigns or legal representatives, may grant and convey 
an exclusive right under the application for patent, or under the 
patent, to the whole or any specified part of the United States. Any 
such assignment, grant, or conveyance of any application for patent, or 
of any patent, may be acknowledged, in a foreign country, before ``a 
diplomatic or consular officer of the United States or an officer 
authorized to administer oaths whose authority is proved by a 
certificate of a diplomatic or consular officer of the United States'' 
(35 U.S.C. 261). See Sec. 92.37 regarding authentication of the 
authority of a foreign official.
    (f) Fees. The fee for administering an oath, taking an 
acknowledgment, or supplying an authentication, in connection with 
patent applications is as prescribed in item 49 of the Tariff of Fees, 
Foreign Service of the United States of America (Sec. 22.1 of this 
chapter).



Sec. 92.73  Services in connection with trademark registrations.

    (a) Authority and responsibility. Acknowledgments and oaths required 
in

[[Page 309]]

connection with applications for registration of trademarks may be made, 
in a foreign country, before any diplomatic or consular officer of the 
United States or before any official authorized to administer oaths in 
the foreign country whose authority must be proved by a certificate of a 
diplomatic or consular officer of the United States (15 U.S.C. 1061). 
The responsibility of officers of the Foreign Service in this connection 
is the same as that where notarial services in connection with patent 
applications are involved (see Sec. 92.72(a)). (See Sec. 92.72(c) 
regarding the authentication of the authority of a foreign official who 
performs a notarial service in connection with a patent application.)
    (b) Fees. The fee for administering an oath, taking an 
acknowledgment, or supplying an authentication, in connection with an 
application for registration of a trademark, or with the assignment or 
transfer of rights thereunder, is as prescribed in item 49 of the Tariff 
of Fees, Foreign Service of the United States of America (Sec. 22.1 of 
this chapter).



Sec. 92.74  Services in connection with United States securities or interests therein.

    (a) Authority and responsibility. Assignments or requests for 
payment of United States securities, or securities for which the 
Treasury Department acts as transfer agent, or powers of attorney in 
connection therewith where authorized by the Treasury Department, 
should, in a foreign country, be executed before a United States 
consular or diplomatic officer. However, if they are executed before a 
foreign official having power to administer oaths, the Treasury 
Department requires that the official character and jurisdiction on the 
foreign official be certified by a United States diplomatic or consular 
officer. (See Secs. 92.36 to 92.41 on authentications.)
    (b) Fees. Officers of the Foreign Service should charge no fees for 
notarial services they perform in connection with the execution of 
documents, including the certification or authentication of documents 
where necessary, which affect United States securities or securities for 
which the Treasury Department acts as transfer agent, or which may be 
required in the collection of interest thereon. Item 58(b) of the Tariff 
of Fees, Foreign Service of the United States of America (Sec. 22.1 of 
this chapter) applies in cases of this nature.



Sec. 92.75  Services in connection with income tax returns.

    (a) Responsibility. Officers of the Foreign Service are authorized 
to perform any and all notarial services which may be required in 
connection with the execution of Federal, state, territorial, municipal, 
or insular income tax returns. Officers should not give advice on the 
preparation of tax returns.
    (b) Fees. No charge under the caption ``Notarial Services and 
Authentications'' should be made for services performed in connection 
with the execution of tax returns for filing with the Federal or State 
Governments or political subdivisions thereof. When requested, see item 
58(d) of the Tariff of Fees, Foreign Service of the United States of 
America (Sec. 22.1 of this chapter).

         Copying, Recording, Translating and Procuring Documents



Sec. 92.76  Copying documents.

    (a) Consular authority. The consular officer is authorized to have 
documents, or abstracts therefrom, copied at a Foreign Service post, if 
he deems it advisable and it is practicable to do so. This service 
frequently is necessary in connection with the performance of certain 
notarial acts, such as the certification of copies of documents.
    (b) Fees. The charges for making copies of documents are as 
prescribed by the Tariff of Fees, Foreign Service of the United States 
of America (Sec. 22.1 of this chapter), under the caption ``Copying and 
Recording,'' unless the service is Performed for official use, which 
comes under the caption Exemption for Federal Agencies and Corporations 
of the same Tariff.



Sec. 92.77  Recording documents.

    (a) Consular authority. Consular officers may, at their discretion, 
accept for recording in the Miscellaneous Record Book of the office 
concerned

[[Page 310]]

unofficial documents such as deeds, leases, agreements, wills, and so 
on. The object of this service is primarily to afford United States 
citizens and interests the means of preserving, in official custody, 
records of their business and other transactions where other suitable 
facilities are not available locally for making such records. The 
recording of unofficial documents is not a notarial service, strictly 
speaking; however, the certifying of copies of documents thus recorded 
is a notarial service.
    (b) Recording procedure. Generally, before accepting a document for 
recording the consular officer should require satisfactory proof of its 
genuineness. The document should be copied, word for word, in the 
Miscellaneous Record Book. At the close of the record a statement that 
it is a true copy of the original should be entered and signed by the 
consular officer who copies or compares the record. In the margin of the 
first page where the document is recorded, the consular officer should 
note the following data:
    (1) By whom the document is presented for recording;
    (2) On whose behalf the service is requested;
    (3) Date and hour of presentation for recording;
    (4) How the authenticity of the document was proved (where 
appropriate); and
    (5) The name of the person by whom recorded (in his proper 
signature) and the name of the consular officer with whom compared (in 
his proper signature).
    (c) Certificate of recording. Ordinarily, a certificate of recording 
need not be issued. The original document may simply be endorsed: 
``Recorded at (name and location of consular office) this ---------- day 
of ------------------, 19----, in (here insert appropriate reference to 
volume of Miscellaneous Record Book)''. Below the endorsement should 
appear the notation regarding the service number, the Tariff item 
number, and the amount of the fee collected. When a certificate of 
recording is requested, the consular officer may issue it, if he sees 
fit to do so. The certificate may be either entered on the document, if 
space permits, or appended to the document as a separate sheet in the 
manner prescribed in Sec. 92.17.
    (d) Fees. The fee for recording unofficial documents at a Foreign 
Service post is as prescribed under the caption ``Copying and 
Recording'' of the Tariff of Fees, Foreign Service of the United States 
of America (Sec. 22.1 of this chapter). For purposes of assessment of 
fees, the issuance of certificates of recording, when requested, shall 
be regarded as part of the consular service of recording unofficial 
documents, and no separate fee shall be charged for the certificate.



Sec. 92.78  Translating documents.

    Officers of the Foreign Service are not authorized to translate 
documents or to certify to the correctness of translations. (However, 
see Sec. 92.56 with regard to interpreting and translating services 
which may be performed in connection with depositions.) They are 
authorized to administer to a translator an oath as to the correctness 
of a translation; to take an acknowledgment of the preparation of a 
translation; and to authenticate the seal and signature of a local 
official affixed to a translation. Separate fees should be charged for 
each of these services, as indicated under the caption ``Notarial 
Services and Authentications'' of the Tariff of Fees, Foreign Service of 
the United States of America (Sec. 22.1 of this chapter).



Sec. 92.79  Procuring copies of foreign public documents.

    (a) Nature of services. When requested to do so by United States 
citizens or by persons acting in behalf of United States citizens, a 
consular officer should endeavor to obtain from foreign officials copies 
of birth, death, and marriage certificates, or copies of other public 
records such as divorce decrees, probated wills, and so on. The interest 
of the party requesting the document should be clearly indicated, and 
there should be good reason for asking for the consular officer's 
assistance. Persons requesting documents for use in the preparation of 
family trees or in the compilation of genealogical studies should be 
referred to a local attorney

[[Page 311]]

or to a genealogical research bureau if one is available.
    (b) Payment of expenses involved--(1) Official funds not to be used. 
The use of official funds to pay for copies of or extracts from foreign 
public records obtained at the request of private persons is prohibited.
    (2) Payment of costs by Federal Government. In instances of requests 
emanating from departments or agencies of the Federal Government for 
copies of or extracts from foreign public records, the Department will 
issue to Foreign Service posts concerned appropriate instructions with 
respect to the payment of whatever local costs may be entailed if the 
documents cannot be obtained gratis from the local authorities.
    (3) Payment of costs by State or municipal governments. Should 
State, county, municipal or other authorities in the United States 
besides the Federal Government request the consular officer to obtain 
foreign documents, and express willingness to supply documents gratis in 
analogous circumstances, the consular officer may endeavor on that basis 
to obtain the desired foreign documents gratis. Otherwise, such 
authorities should be informed that they must pay the charges of the 
foreign officials, as well as any fees which it may be necessary for the 
consular officer to collect under the provisions of the Tariff of Fees, 
Foreign Service of the United States of America (Sec. 22.1 of this 
chapter).
    (4) Payment of costs by private persons. Before a consular officer 
endeavors to obtain a copy of a foreign public document in behalf of a 
private person, the person requesting the document should be required to 
make a deposit of funds in an amount sufficient to defray any charges 
which may be made by the foreign authorities, as well as the Foreign 
Service fee for authenticating the document, should authentication be 
desired.



Sec. 92.80  Obtaining American vital statistics records.

    Individuals who inquire as to means of obtaining copies of or 
extracts from American birth, death, marriage, or divorce records may be 
advised generally to direct their inquires to the Vital Statistics 
Office at the place where the record is kept, which is usually in the 
capital city of the State or Territory. Legal directories and other 
published works of references at the post may be of assistance in 
providing exact addresses, information about fees, etc. An inquirer who 
is not an American citizen may write directly to the diplomatic or 
appropriate consular representative of his own country for any needed 
assistance in obtaining a desired document.

                          Quasi-Legal Services



Sec. 92.81  Performance of legal services.

    (a) Legal services defined. The term ``legal services'' means 
services of the kind usually performed by attorneys for private persons 
and includes such acts as the drawing up of wills, powers of attorney, 
or other legal instruments.
    (b) Performance usually prohibited--(1) General prohibition; 
exceptions. Officers of the Foreign Service should not perform legal 
services except when instructed to do so by the Secretary of State, or 
in cases of sudden emergency when the interests of the United States 
Government, might be involved, or in cases in which no lawyer is 
available and refusal to perform the service would result in the 
imposition of extreme hardship upon a United States citizen. There is no 
objection, however, to permitting persons to use the legal references in 
the Foreign Service office giving specimen forms of wills, powers of 
attorney, etc.
    (2) Specific prohibitions and restrictions. See Sec. 72.41 of this 
chapter for prohibition of performance of legal services by consular 
officers in connection with decedents' estates. See Sec. 92.11 
restricting the preparation for private parties of legal documents for 
signature and notarization.
    (3) Acceptance of will for deposit prohibited. Wills shall not be 
accepted for safekeeping in the office safe. If a person desires to have 
his last will and testament made a matter of record in a Foreign Service 
establishment, the officer to whom application is made shall have the 
will copied in the Miscellaneous Record Book (Sec. 92.77) and charge the 
prescribed fee therefor.
    (c) Refusal of requests. In refusing requests for the performance of 
legal

[[Page 312]]

services, an officer of the Foreign Service should cite these 
regulations and should state clearly his reasons for refusing to act. In 
appropriate cases, the officer may furnish the inquirer with a copy of 
the annual list of attorneys (see Sec. 92.82) practicing in the consular 
district or he may refer the inquirer to the Department for a list of 
attorneys.
    (d) Waiver of responsibility. When an officer of the Foreign Service 
accedes to a request for the performance of a legal service, he should 
inform the applicant that the service is performed at the latter's risk 
and without any responsibility on the part of the United States 
Government or the officer performing the service.
    (e) Fees. No fee should be charged for any legal services which may 
be performed under these regulations, beyond the fees or charges for 
specific services enumerated in the Tariff of Fees, Foreign Service of 
the United States of America (Sec. 22.1 of this chapter).



Sec. 92.82  Recommending attorneys or notaries.

    (a) Assistance in selecting American lawyers. When any person in the 
district of a Foreign Service post desires to have the name of an 
attorney in the United States, the officer at the post may refer him to 
American law directories or other published references at his disposal, 
but he shall refrain from recommending any particular attorney.
    (b) Assistance in selecting foreign attorneys or notaries. Persons 
applying to a Foreign Service post for services of a legal or fiduciary 
character or for assistance in selecting an attorney or notary capable 
of rendering the services in view, may be furnished the names of several 
attorneys or notaries in the district, or referred to the lists to be 
found in American or foreign law directories or other published 
references. Alternatively, they may be referred to bar associations or, 
where applicable, to the organization charged by local law with the 
responsibility for providing legal assistance.
    (c) Agreements for referral of legal business prohibited. Officers 
of the Foreign Service shall not recommend particular attorneys or 
notaries to persons who apply to a Foreign Service post for legal 
assistance, nor shall they make agreements with attorneys or notaries 
for the referral to them of inquiries for legal assistance.



Sec. 92.84  Legal process defined.

    Legal process means a writ, warrant, mandate, or other process 
issuing from a court of justice. The term includes subpoenas, citations, 
and complaints.



Sec. 92.85  Service of legal process usually prohibited.

    The service of process and legal papers is not normally a Foreign 
Service function. Except when directed by the Department of State, 
officers of the Foreign Service are prohibited from serving process or 
legal papers or appointing other persons to do.
[32 FR 11776, Aug. 16, 1967]



Sec. 92.86  Consular responsibility for serving subpoenas.

    When directed by the Department of State, officers of the Foreign 
Service will serve a subpoena issued by a court of the United States on 
a national or resident of the United States who is in a foreign country 
unless such action is prohibited by the law of the foreign country.
[32 FR 11776, Aug. 16, 1967]



Sec. 92.87  Consular responsibility for serving orders to show cause.

    Officers of the Foreign Service are required to serve orders to show 
cause issued in contempt proceedings on a person who has failed or 
neglected to appear in answer to a subpoena served in accordance with 
the provisions of Sec. 92.86. (Section 1, 62 Stat. 949; 28 U.S.C. 1784.)



Sec. 92.88  Consular procedure.

    With regard to the serving of subpoenas and orders to show cause 
referred to in Secs. 92.86 and 92.87, section 1 of the act of June 25, 
1948 (sec. 1, 62 Stat. 819, 28 U.S.C. 1783), provides that the subpoena 
shall designate the time and place for appearance before the court of 
the United States, and shall issue to any consular officer of the United 
States in the foreign country. The consular officer is required to make 
personal service of the subpoena and any

[[Page 313]]

order to show cause, rule, judgment or decree on the request of the 
Federal court or its marshal, and to make return thereof to such court 
after tendering to the witness his necessary travel and attendance 
expenses, which will be determined by the court and sent with the 
subpoena. When the subpoena or order is forwarded to the officer, it is 
usually accompanied by instructions directing exactly how service should 
be made and how the return of service should be executed. These 
instructions should be followed carefully.



Sec. 92.89  Fees for service of legal process.

    No charge should be made for serving a subpoena or order to show 
cause issuing out of Federal court under the procedures set forth in 
Secs. 92.86 and 92.87. The taking of the affidavit of the officer 
effecting the service, or the performance of any other notarial act 
which may be involved in making the return, should be without charge, 
under the caption ``Exemption for Federal Agencies and Corporations'' of 
the Tariff of Fees, Foreign Service of the United States of America 
(Sec. 22.1 of this chapter).



Sec. 92.90  Delivering documents pertaining to the revocation of naturalization.

    Officers of the Foreign Service shall deliver, or assist in 
delivering, to designated persons, documents relating to proceedings in 
the cancellation of certificates of naturalization when such documents 
are forwarded by duly authorized officials of the Federal courts. The 
responsibility for furnishing detailed instructions on the procedure to 
be followed in delivering such documents rests with the court or with 
the United States attorney concerned, and officers should follow such 
instructions carefully.



Sec. 92.91  Service of documents at request of Congressional committees.

    Officers of the Foreign Service have no authority to serve upon 
persons in their consular districts legal process such as subpoenas or 
citations in connection with Congressional investigations. All requests 
for such service should be referred to the Department of State.



Sec. 92.92  Service of legal process under provisions of State law.

    It may be found that a State statue purporting to regulate the 
service of process in foreign countries is so drawn as to mention 
service by an American consular officer or a person appointed by him, 
without mention of or provision for alternate methods of service. State 
laws of this description do not operate in derogation of the laws of the 
foreign jurisdiction wherein it may be sought to effect service of legal 
process, and such State laws do not serve to impose upon American 
consular officers duties or obligations which they are unauthorized to 
accept under Federal law, or require them to perform acts contrary to 
Federal regulations (see Sec. 92.85).



Sec. 92.93  Notarial services or authentications connected with service of process by other persons.

    An officer of the Foreign Service may administer an oath to a person 
making an affidavit to the effect that legal process has ben served. 
When an affidavit stating that legal process has been served is executed 
before a foreign notary or other official, an officer of the Foreign 
Service may authenticate the official character of the person 
administering the oath. The fee for administering an oath to a person 
making an affidavit or for an authentication, as the case may be, is as 
prescribed under the caption ``Notarial Services and Authentications'' 
in the Tariff of Fees, Foreign Service of the United States of America 
(Sec. 22.1 of this chapter), unless the case is of such nature as to 
fall under the caption, ``Exemption for Federal Agencies and 
Corporations'' of the same Tariff.



Sec. 92.94  Replying to inquiries regarding service of process or other documents.

    Officers should make prompt and courteous replies to all inquiries 
regarding the service of legal process or documents of like nature, and 
should render such assistance as they properly

[[Page 314]]

can to the court and to interested parties. Such assistance could 
include furnishing information as to the standard procedure of the 
locality for service of legal papers, with the name and address of the 
local office having a bailiff authorized to effect and make return of 
service; it could include furnishing a list of local attorneys capable 
of making necessary arrangements; or it could, where appropriate, 
include a suggestion that the request of the American court might be 
presented to the foreign judicial authorities in the form of letters 
rogatory (see definition, Sec. 92.54, and procedures, Sec. 92.66 (b)). 
If the person upon whom the process is intended to be served is known to 
be willing to accept service, or if it is clear that it would be in his 
interest at least to be informed of the matter, the consular officer may 
suggest to the interested parties in the United States the drawings up 
of papers for voluntary execution by such person, such as a waiver of 
service or a document which would be acceptable to the American court to 
signify the person's entering an appearance in the action pending 
therein.



Sec. 92.95  Transportation of witnesses to the United States.

    Officers of the Foreign Service may at times be called upon to 
assist in arranging for the transportation to the United States of 
persons in foreign countries whose testimony is desired by the Attorney 
General in a case pending in a Federal court. Requests that the travel 
of such persons be facilitated originate in the Department of Justice, 
and special instructions in each case are transmitted to the appropriate 
Foreign Service post by the Department of State.



PART 93--SERVICE ON FOREIGN STATE--Table of Contents




Sec.
93.1  Service through the diplomatic channel.
93.2  Notice of suit (or of default judgment).



Sec. 93.1  Service through the diplomatic channel.

    (a) The Director of the Office of Special Consular Services in the 
Bureau of Security and Consular Affairs, Department of State (``The 
Director of Special Consular Services''), shall perform the duties of 
the Secretary of State under section 1608(a)(4) of title 28, United 
States Code.
    (b) When the clerk of the court concerned sends documents under 
section 1608(a)(4), of title 28, United States Code, the Director of 
Special Consular Services shall promptly ascertain if the documents 
include the required copies of the notice of suit and of the summons and 
complaint (or default judgment), and any required translations. If not, 
he shall promptly advise the clerk of the missing items.
    (c) Upon receiving the required copies of documents and any required 
translations, the Director of Special Consular Services shall promptly 
cause one copy of each such document and translation (``the documents'') 
to be delivered--
    (1) To the Embassy of the United States in the foreign state 
concerned, and the Embassy shall promptly deliver them to the foreign 
ministry or other appropriate authority of the foreign state, or
    (2) If the foreign state so requests or if otherwise appropriate, to 
the embassy of the foreign state in the District of Columbia, or
    (3) If paragraphs (c)(1) and (2) of this section are unavailable, 
through an existing diplomatic channel, such as to the embassy of 
another country authorized to represent the interests of the foreign 
state concerned in the United States.
    (d) The documents, when delivered under paragraph (c) of this 
section, shall be accompanied by a diplomatic note of transmittal, 
requesting that the documents be forwarded to the appropriate authority 
of the foreign state or political subdivision upon which service is 
being made. The note shall state that, under United States law, 
questions of jurisdiction and of state immunity must be addressed to the 
court and not to the Department of State, and that it is advisable to 
consult with an attorney in the United States.
    (e) If the documents are delivered under paragraph (c)(1) of this 
section, the Embassy of the United States shall

[[Page 315]]

promptly transmit by diplomatic pouch, to the Director of Special 
Consular Services, a certified copy of the diplomatic note of 
transmittal. If the documents are delivered under paragraph (c) (2) or 
(3) of this section, the Director of Special Consular Services shall 
prepare a certified copy of the diplomatic note of transmittal. In each 
case, the certification shall state the date and place the documents 
were delivered. The Director of Special Consular Services shall then 
promptly send the certified copy to the clerk of the court concerned.

(Sec. 1608(a), Foreign Sovereign Immunities Act of 1976, Pub. L. 94-583 
(28 U.S.C. 1608(a)); sec. 4, 63 Stat. 111, as amended (22 U.S.C. 2658))
[42 FR 6367, Feb. 2, 1977]



Sec. 93.2  Notice of suit (or of default judgment).

    (a) A Notice of Suit prescribed in section 1608(a) of title 28, 
United States Code, shall be prepared in the form that appears in the 
Annex to this section.
    (b) In preparing a Notice of Suit, a party shall in every instance 
supply the information specified in items 1 through 5 of the form 
appearing in the Annex to this section. A party shall also supply 
information specified in item 6, if notice of a default judgment is 
being served.
    (c) In supplying the information specified in item 5, a party shall 
in simplified language summarize the nature and purpose of the 
proceeding (including principal allegations and claimed bases of 
liability), the reasons why the foreign state or political subdivision 
has been named as a party in the proceeding, and the nature and amount 
of relief sought. The purpose of item 5 is to enable foreign officials 
unfamiliar with American legal documents to ascertain the above 
information.
    (d) A party may attach additional pages to the Notice of Suit to 
complete information under any item.
    (e) A party shall attach, as part of the Notice of Suit, a copy of 
the Foreign State Immunities Act of 1976 (Pub. L. 94-583; 90 Stat. 
2891).

                                  Annex

          Notice of Suit (or of Default Judgment 1)
---------------------------------------------------------------------------


    1 Relevant only if items 4 and 6 indicate that a default 
judgment has occurred.

    1. Title of legal proceeding; full name of court; case or docket 
number.
    2. Name of foreign state (or political subdivision) concerned:
    3. Identity of the other Parties:

                           Judicial Documents

    4. Nature of documents served (e.g., Summons and Complaint; Default 
Judgment):
    5. Nature and purpose of the proceedings; why the foreign state (or 
political subdivision) has been named; relief requested:
    6. Date of default judgment (if any):
    7. A response to a ``Summons'' and ``Complaint'' is required to be 
submitted to the court, not later than 60 days after these documents are 
received. The response may present jurisdictional defenses (including 
defenses relating to state immunity).
    8. The failure to submit a timely response with the court can result 
in a Default Judgment and a request for execution to satisfy the 
judgment. If a default judgment has been entered, a procedure may be 
available to vacate or open that judgment.
    9. Questions relating to state immunities and to the jurisdiction of 
United States courts over foreign states are governed by the Foreign 
Sovereign Immunities Act of 1976, which appears in sections 1330, 
1391(f), 1441(d), and 1602 through 1611, of Title 28, United States Code 
(Pub. L. 94-583; 90 Stat. 2891).

(Sec. 1608(a), Foreign Sovereign Immunities Act of 1976, Pub. L. 94-583 
(28 U.S.C. 1608(a)); sec. 4, 63 Stat. 111, as amended (22 U.S.C. 2658))
[42 FR 6367, Feb. 2, 1977]



PART 94--INTERNATIONAL CHILD ABDUCTION--Table of Contents




Sec.
94.1  Definitions.
94.2  Designation of Central Authority.
94.3  Functions of the Central Authority.
94.4  Prohibitions.
94.5  Application.
94.6  Procedures for children abducted to the United States.
94.7  Procedures for children abducted from the United States.
94.8  Interagency coordinating group.

    Authority:  Hague Convention on the Civil Aspects of International 
Child Abduction; the federal ``International Child Abduction Remedies 
Act,'' Pub. L. 100-300.

[[Page 316]]


    Source:  53 FR 23608, June 23, 1988, unless otherwise noted.



Sec. 94.1  Definitions.

    For purposes of this part--
    (a) Convention means the Hague Convention on the Civil Aspects of 
International Child Abduction, Appendix B to Department of State notice, 
51 FR 10498, March 26, 1986.
    (b) Contracting State means any country which is a party to the 
Convention.
    (c) Child and children mean persons under the age of sixteen.



Sec. 94.2  Designation of Central Authority.

    The Office of Children's Issues in the Bureau of Consular Affairs is 
designated as the U.S. Central Authority to discharge the duties which 
are imposed by the Convention and the International Child Abduction 
Remedies Act upon such authorities.
[60 FR 25843, May 15, 1995]



Sec. 94.3  Functions of the Central Authority.

    The U.S. Central Authority shall cooperate with the Central 
Authorities of other countries party to the Convention and promote 
cooperation by appropriate U.S. state authorities to secure the prompt 
location and return of children wrongfully removed to or retained in any 
Contracting State, to ensure that rights of custody and access under the 
laws of one Contracting State are effectively respected in the other 
Contracting States, and to achieve the other objects of the Convention. 
In performing its functions, the U.S. Central Authority may receive 
from, or transmit to, any department, agency, or instrumentality of the 
federal government, or of any state or foreign government, information 
necessary to locate a child or for the purpose of otherwise implementing 
the Convention with respect to a child.



Sec. 94.4  Prohibitions.

    (a) The U.S. Central Authority is prohibited from acting as an agent 
or attorney or in any fiduciary capacity in legal proceedings arising 
under the Convention. The U.S. Central Authority is not responsible for 
the costs of any legal representation or legal proceedings nor for any 
transportation expenses of the child or applicant. However, the U.S. 
Central Authority may not impose any fee in relation to the 
administrative processing of applications submitted under the 
Convention.
    (b) The U.S. Central Authority shall not be a repository of foreign 
or U.S. laws.



Sec. 94.5  Application.

    Any person, institution, or other body may apply to the U.S. Central 
Authority for assistance in locating a child, securing access to a 
child, or obtaining the return of a child that has been removed or 
retained in breach of custody rights. The application shall be made in 
the form prescribed by the U.S. Central Authority and shall contain such 
information as the U.S. Central Authority deems necessary for the 
purposes of locating the child and otherwise implementing the 
Convention. The application and any accompanying documents should be 
submitted in duplicate in English or with English translations. If 
intended for use in a foreign country, two additional copies should be 
provided in the language of the foreign country.



Sec. 94.6  Procedures for children abducted to the United States.

    The National Center for Missing and Exploited Children shall act 
under the direction of the U.S. Central Authority and shall perform the 
following operational functions with respect to all Hague Convention 
applications seeking the return of children wrongfully removed to or 
retained in the United States or seeking access to children in the 
United States:
    (a) Receive all applications on behalf of the U.S. Central 
Authority;
    (b) Confirm the child's location or, where necessary, seek to 
ascertain its location;
    (c) Seek to ascertain the child's welfare through inquiry to the 
appropriate state social service agencies and, when necessary, consult 
with those agencies about the possible need for provisional arrangements 
to protect the child or to prevent the child's removal from the 
jurisdiction of the state;
    (d) Seek through appropriate authorities (such as state social 
service

[[Page 317]]

agencies or state attorneys general or prosecuting attorneys), where 
appropriate, to achieve a voluntary agreement for suitable visitation 
rights by the applicant or for return of the child;
    (e) Assist applicants in securing information useful for choosing or 
obtaining legal representation, for example, by providing a directory of 
lawyer referral services, or pro bono listing published by legal 
professional organizations, or the name and address of the state 
attorney general or prosecuting attorney who has expressed a willingness 
to represent parents in this type of case and who is employed under 
state law to intervene on the applicant's behalf;
    (f) Upon request, seek from foreign Central Authorities information 
relating to the social background of the child;
    (g) Upon request, seek from foreign Central Authorities information 
regarding the laws of the country of the child's habitual residence;
    (h) Upon request, seek from foreign Central Authorities a statement 
as to the wrongfulness of the taking of the child under the laws of the 
country of the child's habitual residence;
    (i) Upon request, seek a report on the status of court action when 
no decision has been reached by the end of six weeks;
    (j) Consult with appropriate agencies (such as state social service 
departments, the U.S. Department of Health and Human Services, state 
attorneys general) about possible arrangements for temporary foster care 
and/or return travel for the child from the United States;
    (k) Monitor all cases in which assistance has been sought and 
maintain records on the procedures followed in each case and its 
disposition;
    (l) Perform such additional functions as set out in the 
``Cooperative Agreement Adjustment Notice'' between the Department of 
State, Department of Justice, and National Center for Missing and 
Exploited Children.
[53 FR 23608, June 23, 1988, as amended at 60 FR 66074, Dec. 21, 1995]



Sec. 94.7  Procedures for children abducted from the United States.

    Upon receipt of an application requesting access to a child or 
return of a child abducted from the United States and taken to another 
country party to the Convention, the U.S. Central Authority shall--
    (a) Review and forward the application to the Central Authority of 
the country where the child is believed located or provide the applicant 
with the necessary form, instructions, and the name and address of the 
appropriate Central Authority for transmittal of the application 
directly by the applicant;
    (b) Upon request, transmit to the foreign Central Authority requests 
for a report on the status of any court action when no decision has been 
reached by the end of six weeks;
    (c) Upon request, facilitate efforts to obtain from appropriate U.S. 
state authorities and transmit to the foreign Central Authority 
information regarding the laws of the child's state of habitual 
residence;
    (d) Upon request, facilitate efforts to obtain from appropriate U.S. 
state authorities and transmit to the foreign Central Authority a 
statement as to the wrongfulness of the taking of the child under the 
laws of the child's state of habitual residence;
    (e) Upon request, facilitate efforts to obtain from appropriate U.S. 
state authorities and transmit to the foreign Central Authority 
information relating to the social background of the child;
    (f) Upon request, be available to facilitate possible arrangements 
for temporary foster care and/or travel for the child from the foreign 
country to the United States;
    (g) Monitor all cases in which assistance has been sought; and
    (h) Perform such additional functions as the Assistant Secretary of 
State for Consular Affairs may from time to time direct.



Sec. 94.8  Interagency coordinating group.

    The U.S. Central Authority shall nominate federal employees and may, 
from time to time, nominate private citizens to serve on an interagency 
coordinating group to monitor the operation of the Convention and to 
provide

[[Page 318]]

advice on its implementation. This group shall meet from time to time at 
the request of the U.S. Central Authority.

[[Page 319]]



     SUBCHAPTER K--ECONOMIC, COMMERCIAL AND CIVIL AVIATION FUNCTIONS





PART 101--ECONOMIC AND COMMERCIAL FUNCTIONS--Table of Contents




Sec.
101.1  Protection of American interests.
101.2  Promotion of American interests.
101.3  Services for American businessmen and organizations.
101.4  Economic and commercial reporting.

    Authority:  Sec. 302, 60 Stat. 1001; 22 U.S.C. 842.

    Source:  22 FR 10871, Dec. 27, 1957, unless otherwise noted.



Sec. 101.1  Protection of American interests.

    Officers of the Foreign Service shall protect the rights and 
interests of the United States in its international agricultural, 
commercial, and financial relations. In pursuance of this duty, they 
shall:
    (a) Guard against the infringement of rights of American citizens in 
matters relating to commerce and navigation which are based on custom, 
international law, or treaty.
    (b) Observe, report on, and, whenever possible, endeavor to remove 
discriminations against American agricultural, commercial, and 
industrial interests in other countries.
    (c) Protect the national commercial reputation of the United States.



Sec. 101.2  Promotion of American interests.

    Officers of the Foreign Service shall further the agricultural and 
commercial interests of the United States:
    (a) By carefully studying and reporting on the potentialities of 
their districts as a market for American products or as a competitor of 
American products in international trade.
    (b) By investigating and submitting World Trade Directory Reports on 
the general standing and distributing capacity of foreign firms within 
their districts.
    (c) By preparing and submitting upon request trade lists of 
commercial firms within their districts.
    (d) By keeping constantly on the alert for and submitting immediate 
reports on concrete trade opportunities.
    (e) By endeavoring to create, within the scope of the duties to 
which they are assigned, a demand for American products within their 
districts.
    (f) By facilitating and reporting on proposed visits of alien 
businessmen to the United States.
    (g) By taking appropriate steps to facilitate the promotion of such 
import trade into the United States as the economic interests of the 
United States may require.



Sec. 101.3  Services for American businessmen and organizations.

    Officers of the Foreign Service shall perform the following-
enumerated services for American citizens and business organizations in 
connection with the conduct of foreign trade subject to such rules and 
limitations thereon as may be prescribed by the Secretary of State:
    (a) Answering trade inquiries.
    (b) Lending direct assistance to American citizens and business 
firms.
    (c) Encouraging the establishment of, and supporting, American 
chambers of commerce.
    (d) Preparing themselves for and, upon instructions, performing 
trade conference work when in the United States on leave, or otherwise.



Sec. 101.4  Economic and commercial reporting.

    Officers of the Foreign Service shall prepare and submit reports in 
connection with their duties of protecting and promoting American 
agricultural commercial interests and for the purpose of providing 
general information on economic developments within their respective 
districts for the Departments of State, Agriculture, and Commerce, and 
for other governmental departments and agencies, in accordance with such 
rules and regulations as the Secretary of State may prescribe.

[[Page 320]]



PART 102--CIVIL AVIATION--Table of Contents




           Subpart A--United States Aircraft Accidents Abroad

Sec.
102.8  Reporting accidents.
102.9  Arranging for entry and travel of investigating and airline 
          representatives.
102.10  Rendering assistance at the scene of the accident.
102.11  Arranging for the payment of expenses attendant upon an 
          accident.
102.12  Protective services for survivors.
102.13  Protective services with respect to deceased victims of 
          accidents.
102.14  Salvage of mail and other property.
102.15  Protection and preservation of wreckage.
102.16  Records and reports in connection with investigation.

 Foreign Aircraft Accidents Involving United States Persons or Property

102.17  Reports on accident.
102.18  Protection of United States citizens involved.
102.19  Protection of United States property.

  Subpart B--Recommendations to the President Under Section 801 of the 
                      Federal Aviation Act of 1958

102.21  Purpose.
102.22  [Reserved]
102.23  Applicability.
102.24  [Reserved]
102.25  Submission of comments.
102.26  [Reserved]
102.27  Docket.



           Subpart A--United States Aircraft Accidents Abroad

    Authority:  Sec. 302, 60 Stat. 1001; 22 U.S.C. 842.

    Source:  22 FR 10871, Dec. 27, 1957, unless otherwise noted.



Sec. 102.8  Reporting accidents.

    (a) To airline and Civil Aeronautics Administration representatives. 
If a scheduled United States air carrier is involved the airline 
representatives concerned will probably be the first to be informed of 
the accident, in which event he will be expected to report the accident 
to the Foreign Service post, to the nearest Civil Aeronautics 
Administration office, and to his home office in the United States. If 
this is not the case, the Foreign Service post should report promptly to 
the nearest office of the airline concerned and to the nearest office of 
the Civil Aeronautics Administration, any accident occurring to a 
scheduled civil air carrier of United States registry within its 
consular district. To be properly prepared, each post should obtain and 
have on file for ready reference, the address and telephone number of 
representatives of any United States airline engaged in scheduled 
operations within or over the post district.
    (b) To Department and supervisory Foreign Service offices. A Foreign 
Service post should report promptly to the Department accidents to any 
United States civil aircraft occurring in the post district. The report 
should summarize all available information and, in the case of a 
scheduled United States air carrier, should state whether the airline 
has taken over the responsibility of notifying the nearest Civil 
Aeronautics Administration field office. This report should be submitted 
by the most expeditious means possible (priority telephone or telegraph 
message) at Government expense. If the accident involves a private plane 
or non-scheduled air carrier, these circumstances should be reported, 
also whether the nearest office of the Civil Aeronautics Administration 
has been informed. In the latter case, the Department will ascertain 
from the Civil Aeronautics Board whether it desires to investigate the 
case, and inform the Foreign Service post accordingly. Consular posts 
should submit a similar report to their supervisory missions or to their 
supervisory consular offices in territories where there are no United 
States missions. Supplementary reports should be supplied the Department 
and the supervisory Foreign Service office whenever considered 
appropriate. A final report, after the urgency has diminished, and when 
the post's role is negligible should cover the post's activities in 
connection with the accident (see Sec. 102.16(b)).



Sec. 102.9  Arranging for entry and travel of investigating and airline representatives.

    Representatives of the Civil Aeronautics Board, the Civil 
Aeronautics Administration and the United States

[[Page 321]]

airline involved may not have the documents necessary for entry into the 
country where the accident occurred. The local Foreign Service post 
should lend all assistance possible in obtaining the entry of such 
representatives into the country where the accident occurred and in 
expediting their travel to the scene of the accident.



Sec. 102.10  Rendering assistance at the scene of the accident.

    Always in the case of a scheduled United States air carrier and 
whenever necessary in the case of a non-scheduled carrier or private 
plane, a local Foreign Service post should dispatch a member of its 
staff to the scene of the accident in order to insure that proper 
protection is afforded United States citizens and property involved in 
the accident and that any evidence as to the cause of the accident is 
preserved until the arrival of United States Government investigating 
personnel. (For steps to be taken when the aircraft was carrying a 
courier or diplomatic pouches, see Sec. 102.14(b).) In the absence of an 
airline representative, the Foreign Service representative should lend 
the competent local authorities all possible assistance compatible with 
the provisions of Sec. 102.11 in caring for the survivors, identifying 
and disposing of the remains of victims, salvaging and protecting 
property and preserving wreckage pending an investigation. If an airline 
representative is already at the scene of the accident or if one arrives 
shortly thereafter, the Foreign Service representative should assist him 
in the discharge of his recognized responsibilities in connection with 
passengers and cargo. However, the Foreign Service representative is 
also obligated to assist investigating personnel of the United States 
Government by preserving evidence as to the cause of the accident. Any 
attempt on the part of the airline representative to exceed his 
recognized sphere of activity should be called to the attention of the 
airline involved and the competent local authorities.



Sec. 102.11  Arranging for the payment of expenses attendant upon an accident.

    (a) The Department of State has no funds from which expenses 
attendant upon an accident to United States aircraft can be paid. In 
emergencies involving scheduled carriers and in the absence of airline 
representatives, or other authority, the Foreign Service post should 
request a deposit from the airline (through the Department if desired) 
with specific authorization to incur whatever financial obligations the 
airline is willing to assume for the hiring of guards (in case local 
police protection is considered inadequate), the provision of 
accommodations, medical care, and onward transportation for survivors 
and for other expenses resulting from the accident. In accidents 
involving a private plane or non-scheduled carrier, the Foreign Service 
post is not in a position to expend any funds without prior 
authorization from the Department. In such cases, and in extreme cases 
involving scheduled carriers, when airline and investigation personnel 
may be delayed in reaching the scene, the Foreign Service 
representative, as the representative of all segments of the United 
States Government in the area, should endeavor to protect and promote 
the interests of the Government, the airline, and the individual citizen 
by any means available to him that are consistent with these 
regulations, and should request funds and instructions as required from 
the Department.
    (b) The local Foreign Service post is not authorized to expend any 
funds for guarding the wreckage to preserve evidence as to the cause of 
the accident unless the Civil Aeronautics Board or the Civil Aeronautics 
Administration authorizes in advance the expenditure of such funds on a 
reimbursable basis. In the absence of such advance authorization, the 
Foreign Service post can arrange only for such protection as local 
authorities are willing to furnish gratuitously.
    (c) Voluntary services and personal services in excess of those 
authorized by law may be accepted and utilized in

[[Page 322]]

the case of an aircraft accident since the law which normally prohibits 
such acceptance (31 U.S.C. 665) does not apply ``in case of sudden 
emergency involving the loss of human life or the destruction of 
property''.



Sec. 102.12  Protective services for survivors.

    (a) Medical care and hospitalization. The Foreign Service 
representative should lend any assistance possible (see Secs. 102.10 and 
102.11) in arranging for the best medical and hospital attention 
available for injured survivors of the accident. If a scheduled United 
States carrier is involved in an accident, the primary responsibility 
for providing medical care for passengers and crew rests with the 
airline, and in such situations the Foreign Service representative 
should assist the airline in every way that is feasible (see 
Secs. 102.10 and 102.11).
    (b) Accommodation and onward transportation. If a scheduled United 
States carrier is involved in an accident, primary responsibility for 
providing accommodation and onward transportation for passengers and 
crew rests with the airline, and in such situations the Foreign Service 
representative should assist the airline in every way that is feasible 
(see Secs. 102.10 and 102.11). If the accident involves a private plane 
or non-scheduled carrier, he should assist passengers and members of the 
crew who do not require hospitalization in any way compatible with 
Secs. 102.10 and 102.11 in obtaining appropriate comfortable 
accommodations accessible from the scene of the accident. If 
practicable, surviving passengers should remain in the vicinity of the 
accident until the United States Government investigating personnel can 
obtain from them all information pertaining to the accident. Surviving 
passengers leaving the vicinity should furnish addresses at which they 
can be reached later. The Foreign Service representative should assist 
the passengers, insofar as he can under the provision of Secs. 102.10 
and 102.11, in obtaining necessary clearances from local authorities and 
in getting onward transportation by the most expeditious means of common 
carrier transportation available. The surviving aircraft crew will be 
expected to remain in the vicinity of the accident until otherwise 
instructed by the investigating personnel.



Sec. 102.13  Protective services with respect to deceased victims of accidents.

    (a) Interim disposition of remains. Generally, local authorities 
will assume custody of the remains of deceased victims of the accident 
and consign them to a mortuary until final disposition can be made.
    (b) Identification of remains. When necessary, the local Foreign 
Service post should assist in identifying the remains of United States 
citizens who are victims of the accident by requesting the Department to 
procure dental charts, passport application data and photographs, 
fingerprints, or other United States records.
    (c) Reports on deaths of United States citizens. The local Foreign 
Service post shall report the deaths of United States citizens occurring 
in an aircraft accident in accordance with the procedure prescribed in 
Secs. 72.1 to 72.8 of this chapter.
    (d) Disposition of remains. When a scheduled United States air 
carrier meets with an accident, the United States airline concerned will 
usually transport the identifiable remains of victims of the accident to 
the place of final interment designated by the next of kin. If the 
Foreign Service post is requested, or finds it necessary, to dispose of 
identifiable remains, it shall follow the procedure prescribed in 
Secs. 72.9 to 72.14 of this chapter. Where remains are unidentifiable, 
the local authorities may be expected to make final disposition of these 
remains locally in accordance with the health requirements of the 
country concerned, usually by common burial or by cremation, and without 
regard to the disposition desired by possible next of kin.



Sec. 102.14  Salvage of mail and other property.

    (a) Mail. Article 3, sections 6 and 7, of the Air Mail Provisions 
annexed to the Universal Postal Union Convention, Paris, 1947, provide 
that the personnel who survive the aircraft accident shall, when 
possible, deliver the mail to the

[[Page 323]]

post office nearest the place of the accident or to the one best-
qualified to reforward the mail. If the aircraft personnel are unable to 
do this, the local post office concerned shall make every effort, 
without delay, to take delivery of the mail and to forward it to the 
offices of designation by the most rapid means, after determining the 
condition of the correspondence and reconditioning it if damaged. Most 
post offices are familiar with these provisions, but if in any case the 
mail is not being properly cared for, the local Foreign Service post 
should bring the proper procedure to the attention of the nearest post 
office.
    (b) Diplomatic pouches. Immediately upon arriving at the scene of 
the accident, the Foreign Service representative should ascertain 
whether the aircraft was carrying a courier or diplomatic pouches. If a 
courier is found to be aboard, the same personal arrangements should be 
made for him as are made for other passengers (see Secs. 102.10 to 
102.13). An immediate search should also be made for whatever diplomatic 
pouches the courier may have been carrying and for any pouches that may 
have been carried as regular cargo. Usually, the cargo manifest will 
list diplomatic pouches carried as air freight or cargo. The passenger 
manifest normally will list the total number of pieces of luggage or 
pouches checked by a courier (if one is aboard), but since he usually 
carries his pouches with him into the cabin of the plane, the pouch 
invoices on his person or in his briefcase will offer positive proof of 
the number of pouches he had in his custody. If any are found, they 
should be cleared through appropriate government officials of the 
country and taken to the nearest United States Foreign Service office to 
await disposition instructions. If it is learned that the postal 
authorities have already recovered United States diplomatic pouches that 
may have been involved, these pouches should be obtained from the postal 
authorities and taken to the nearest United States Foreign Service 
office to await diposition instructions. A telegraphic message should be 
dispatched to the Department and to the regional courier office having 
jurisdiction over that area, giving a description of the pouches 
recovered. This description should include the office of addressor and 
addressee and the classification indicator (C, A, or S). The Department 
and the regional courier office will coordinate instructions to the 
office for the disposition of these pouches.
    (c) Baggage, personal effects and cargo. The Foreign Service 
representative should request the local authorities to arrange for the 
security storage and protection of such baggage, personal effects and 
cargo as is recoverable from the aircraft until the property can be 
released to its owners by local customs and accident investigating 
authorities, or by the courts. When released, the personal effects of 
United States citizens, who died in the accident, should be taken into 
possession and disposed of by the local Foreign Service post in 
accordance with the procedure prescribed in Secs. 72.15 to 72.55 of this 
chapter.



Sec. 102.15  Protection and preservation of wreckage.

    In so far as local law permits, the Foreign Service representative 
should see that arrangements are made (by the airline representative 
with the local authorities, if a scheduled carrier is involved) for the 
protection of the wrecked aircraft and its property contents against 
further damage, pilferage, and access by unauthorized persons, until the 
arrival of the accident investigation personnel. The prior removal of 
any of the wreckage or the contents of the aircraft should be prevented 
unless such action is necessitated by very compelling reasons, such as 
the need for treating the injured or for removing bodies, or when the 
wreckage constitutes a public hazard. When under the latter conditions 
the wreckage and contents of the aircraft must be moved or disturbed in 
any way, if possible, a record should be made or photographs taken 
showing the position and condition of the wreckage prior to disturbance. 
In the case of a private aircraft or non-scheduled carrier, protection 
should be arranged for the wrecked aircraft and its contents pending the 
receipt of information from the Department as to whether the Civil 
Aeronautics Board

[[Page 324]]

will investigate the case, and until final disposition is made of the 
property. If the owner of a private aircraft is killed in the wreck and 
is a United States citizen, the aircraft constitutes part of his 
personal estate and should be disposed of in accordance with the 
provisions of Secs. 72.15 to 72.55 of this chapter. For rules governing 
the payment of expenses in connection with the protection and 
preservation of wrecked United States aircraft, see Sec. 102.11.



Sec. 102.16  Records and reports in connection with investigation.

    (a) Records. The Foreign Service representative should maintain a 
record of the various transactions taking place prior to the arrival of 
airline, Civil Aeronautics Board and Civil Aeronautics Administration 
representatives. This record should include all pertinent details with 
respect to the disposition of persons and property, obligations assumed, 
arrangements made, et cetera, and should also include any statements 
made by witnesses.
    (b) Reports. Reports should be submitted to the Department for its 
information and the information of aviation authorities and other 
interested parties in the United States regarding the progress of any 
investigation which is held and its final outcome when known.

 Foreign Aircraft Accidents Involving United States Persons or Property



Sec. 102.17  Reports on accident.

    When an accident occurs to a foreign aircraft in the district of a 
Foreign Service post and United States citizens or property are 
involved, the local Foreign Service post shall report the disaster fully 
to the Department and to the supervisory mission (or the supervisory 
consular office where there is no mission).



Sec. 102.18  Protection of United States citizens involved.

    The local Foreign Service post shall follow substantially the 
procedures prescribed in Secs. 102.11 to 102.13 in protecting United 
States citizens (whether alive or dead) involved in a foreign aircraft 
accident.



Sec. 102.19  Protection of United States property.

    The local Foreign Service office shall follow substantially the 
procedures set forth in Secs. 102.11 and 102.14 in protecting United 
States mail and baggage, personal effects and cargo belonging to United 
States citizens.



  Subpart B--Recommendations to the President Under Section 801 of the 
                      Federal Aviation Act of 1958

    Authority:  Sec. 4, Act of May 26, 1949, as amended (63 Stat. 111; 
22 U.S.C. 2658); E.O. 11920 (June 11, 1976, 41 FR 23665).

    Source:  41 FR 31548, July 29, 1976, unless otherwise noted.



Sec. 102.21  Purpose.

    The purpose of this subpart is to set forth procedures for the 
receipt by the Department of State of comments from private parties on 
possible recommendations by the Department to the President on decisions 
of the Civil Aeronautics Board submitted for the President's approval 
under section 801 of the Federal Aviation Act of 1958, which relates to 
overseas and international air transportation.



Sec. 102.22  [Reserved]



Sec. 102.23  Applicability.

    (a) This subpart applies to all communications between private 
parties and officials or employees of the Department of State, including 
those stationed abroad, on matters set forth in Sec. 102.21 of this 
subpart.
    (b) This subpart applies, with respect to any particular proceeding 
before the Civil Aeronautics Board, from the time that the Board's 
decision has been submitted to the President for consideration until the 
President has issued a final decision with respect to that proceeding.



Sec. 102.24  [Reserved]



Sec. 102.25  Submission of comments.

    (a) All communications by private parties with Departmental 
officials or

[[Page 325]]

employees concerning a Presidential decision under section 801 of the 
Federal Aviation Act shall, whenever possible, be made in writing. Any 
such communication which is not made in writing shall be summarized by 
the official or employee of the Department who receives the 
communication.
    (b) All such summaries and written communications, except those 
relating to matters that are specifically authorized under criteria 
established by Executive Order to be kept confidential in the interest 
of national defense or foreign policy, are to be placed in a public 
docket and available for public inspection and copying and for 
responsive comment.



Sec. 102.26  [Reserved]



Sec. 102.27  Docket.

    (a) All comments submitted under this subpart shall reference the 
number of the Civil Aeronautics Board docket relating to the proceeding 
which is the subject of the comment.
    (b) The original and four copies of such comments may be mailed to 
the Director, Office of Aviation, Department of State, Washington, DC 
20520, or delivered to the Director, Office of Aviation, Room 5830, 
Department of State, Washington, DC 20520, 8:45 a.m. to 5:30 p.m. local 
time, Monday through Friday except Federal holidays. Written comments 
submitted to Department officials other than the Director of the Office 
of Aviation and summaries of oral communications prepared in accordance 
with Sec. 102.25(a) of this subpart shall be forwarded to the Director 
of the Office of Aviation.
    (c) All comments submitted under this subpart and placed in the 
docket, are available for public inspection and copying and for 
responsive comment at the address and times specified in paragraph (b) 
of this section.

[[Page 326]]



                        SUBCHAPTER L--[RESERVED]



[[Page 327]]



         SUBCHAPTER M--INTERNATIONAL TRAFFIC IN ARMS REGULATIONS





PART 120--PURPOSE AND DEFINITIONS--Table of Contents




Sec.
120.1  General authorities and eligibility.
120.2  Designation of defense articles and defense services.
120.3  Policy on designating and determining defense articles and 
          services.
120.4  Commodity jurisdiction.
120.5  Relation to regulations of other agencies.
120.6  Defense article.
120.7  Significant military equipment.
120.8  Major defense equipment.
120.9  Defense service.
120.10  Technical data.
120.11  Public domain.
120.12  Office of Defense Trade Controls.
120.13  United States.
120.14  Person.
120.15  U.S. person.
120.16  Foreign person.
120.17  Export.
120.18  Temporary import.
120.19  Reexport or retransfer.
120.20  License.
120.21  Manufacturing license agreement.
120.22  Technical assistance agreement.
120.23  Distribution agreement.
120.24  District Director of Customs.
120.25  Empowered Official.
120.26  Presiding Official.
120.27  U.S. criminal statutes.
120.28  Listing of forms referred to in this subchapter.
120.29  Missile Technology Control Regime.


    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; E.O. 11958, 42 FR 4311; 3 CFR, 
1977 Comp. p. 79; 22 U.S.C. 2658.


    Source:  58 FR 39283, July 22, 1993, unless otherwise noted.



Sec. 120.1  General authorities and eligibility.

    (a) Section 38 of the Arms Export Control Act (22 U.S.C. 2778) 
authorizes the President to control the export and import of defense 
articles and defense services. The statutory authority of the President 
to promulgate regulations with respect to exports of defense articles 
and defense services was delegated to the Secretary of State by 
Executive Order 11958, as amended (42 FR 4311). This subchapter 
implements that authority. By virtue of delegations of authority by the 
Secretary of State, these regulations are primarily administered by the 
Director of the Office of Defense Trade Controls, Bureau of Politico-
Military Affairs, Department of State.
    (b) Authorized Officials. All authorities conferred upon the 
Director of the Office of Defense Trade Controls by this subchapter may 
be exercised at any time by the Under Secretary of State for 
International Security Affairs, the Assistant Secretary of State for 
Politico-Military Affairs, or the Deputy Assistant Secretary of State 
for Politico-Military Affairs responsible for supervising the Office of 
Defense Trade Controls unless the Legal Adviser or the Assistant Legal 
Adviser for Politico-Military Affairs of the Department of State 
determines that any specific exercise of this authority under this 
subsection may be inappropriate.
    (c) Eligibility. Only U.S. persons (as defined in Sec. 120.15) and 
foreign governmental entities in the United States may be granted 
licenses or other approvals (other than retransfer approvals sought 
pursuant to this subchapter). Foreign persons (as defined in 
Sec. 120.16) other than governments are not eligible. U.S. persons who 
have been convicted of violating the criminal statutes enumerated in 
Sec. 120.27, who have been debarred pursuant to part 127 or 128 of this 
subchapter, who are the subject of an indictment involving the criminal 
statutes enumerated in Sec. 120.27, who are ineligible to contract with, 
or to receive a license or other form of authorization to import defense 
articles or defense services from any agency of the U.S. Government, who 
are ineligible to receive export licenses (or other forms of 
authorization to export) from any agency of the U.S. Government, who are 
subject to Department of State Suspension/Revocation under Sec. 126.7 
(a)(1)-(a)(7) of this

[[Page 328]]

subchapter, or who are ineligible under Sec. 127.6(c) of this subchapter 
are generally ineligible. Applications for licenses or other approvals 
will be considered only if the applicant has registered with the Office 
of Defense Trade Controls pursuant to part 122 of this subchapter. All 
applications and requests for approval must be signed by a U.S. person 
who has been empowered by the registrant to sign such documents.
    (d) The exemptions provided in this subchapter do not apply to 
transactions in which the exporter or any party to the export (as 
defined in Sec. 126.7(e) of this subchapter) is generally ineligible as 
set forth above in paragraph (c) of this section, unless an exception 
has been granted pursuant to Sec. 126.7(c) of this subchapter.



Sec. 120.2  Designation of defense articles and defense services.

    The Arms Export Control Act (22 U.S.C. 2778(a) and 2794(7)) provides 
that the President shall designate the articles and services deemed to 
be defense articles and defense services for purposes of this 
subchapter. The items so designated constitute the United States 
Munitions List and are specified in part 121 of this subchapter. Such 
designations are made by the Department of State with the concurrence of 
the Department of Defense. For a determination on whether a particular 
item is included on the U.S. Munitions List see Sec. 120.4(a).



Sec. 120.3  Policy on designating and determining defense articles and services.

    An article or service may be designated or determined in the future 
to be a defense article (see Sec. 120.6) or defense service (see 
Sec. 120.9) if it:
    (a) Is specifically designed, developed, configured, adapted, or 
modified for a military application, and
    (i) Does not have predominant civil applications, and
    (ii) Does not have performance equivalent (defined by form, fit and 
function) to those of an article or service used for civil applications; 
or
    (b) Is specifically designed, developed, configured, adapted, or 
modified for a military application, and has significant military or 
intelligence applicability such that control under this subchapter is 
necessary.
    The intended use of the article or service after its export (i.e., 
for a military or civilian purpose) is not relevant in determining 
whether the article or service is subject to the controls of this 
subchapter. Any item covered by the U.S. Munitions List must be within 
the categories of the U.S. Munitions List. The scope of the U.S. 
Munitions List shall be changed only by amendments made pursuant to 
section 38 of the Arms Export Control Act (22 U.S.C. 2778).



Sec. 120.4  Commodity jurisdiction.

    (a) The commodity jurisdiction procedure is used with the U.S. 
Government if doubt exists as to whether an article or service is 
covered by the U.S. Munitions List. It may also be used for 
consideration of a redesignation of an article or service currently 
covered by the U.S. Munitions List. The Department must submit a report 
to Congress at least 30 days before any item is removed from the U.S. 
Munitions List. Upon written request, the Office of Defense Trade 
Controls shall provide a determination of whether a particular article 
or service is covered by the U.S. Munitions List. The determination, 
consistent with Secs. 120.2, 120.3, and 120.4, entails consultation 
among the Departments of State, Defense, Commerce and other U.S. 
Government agencies and industry in appropriate cases.
    (b) Registration with the Office of Defense Trade Controls as 
defined in part 122 of this subchapter is not required prior to 
submission of a commodity jurisdiction request. If it is determined that 
the commodity is a defense article or service covered by the U.S. 
Munitions List, registration is required for exporters, manufacturers, 
and furnishers of defense articles and defense services (see part 122 of 
this subchapter).
    (c) Requests shall identify the article or service, and include a 
history of the product's design, development and use. Brochures, 
specifications and any other documentation related to the article or 
service shall be submitted in seven collated sets.

[[Page 329]]

    (d)(1) A determination that an article or service does not have 
predominant civil applications shall be made by the Department of State, 
in accordance with this subchapter, on a case-by-case basis, taking into 
account:
    (i) The number, variety and predominance of civil applications;
    (ii) The nature, function and capability of the civil applications; 
and
    (iii) The nature, function and capability of the military 
applications.
    (2) A determination that an article does not have the performance 
equivalent, defined by form, fit and function, to those used for civil 
applications shall be made by the Department of State, in accordance 
with this subchapter, on a case-by-case basis, taking into account:
    (i) The nature, function, and capability of the article;
    (ii) Whether the components used in the defense article are 
identical to those components originally developed for civil use.

    Note: The form of the item is its defined configuration, including 
the geometrically measured configuration, density, and weight or other 
visual parameters which uniquely characterize the item, component or 
assembly. For software, form denotes language, language level and media. 
The fit of the item is its ability to physically interface or 
interconnect with or become an integral part of another item. The 
function of the item is the action or actions it is designed to perform.

    (3) A determination that an article has significant military or 
intelligence applications such that it is necessary to control its 
export as a defense article shall be made, in accordance with this 
subchapter, on a case-by-case basis, taking into account:
    (i) The nature, function, and capability of the article;
    (ii) The nature of controls imposed by other nations on such items 
(including COCOM and other multilateral controls), and
    (iii) That items described on the COCOM Industrial List shall not be 
designated defense articles or defense services unless the failure to 
control such items on the U.S. Munitions List would jeopardize 
significant national security or foreign policy interests.
    (e) The Office of Defense Trade Controls will provide a preliminary 
response within 10 working days of receipt of a complete request for 
commodity jurisdiction. If after 45 days the Office of Defense Trade 
Controls has not provided a final commodity jurisdiction determination, 
the applicant may request in writing to the Director, Center for Defense 
Trade that this determination be given expedited processing.
    (f) State, Defense and Commerce will resolve commodity jurisdiction 
disputes in accordance with established procedures. State shall notify 
Defense and Commerce of the initiation and conclusion of each case.
    (g) A person may appeal a commodity jurisdiction determination by 
submitting a written request for reconsideration to the Director of the 
Center for Defense Trade. The Center for Defense Trade will provide a 
written response of the Director's determination within 30 days of 
receipt of the appeal. If desired, an appeal of the Director's decision 
can then be made directly to the Assistant Secretary for Politico-
Military Affairs.



Sec. 120.5  Relation to regulations of other agencies.

    If an article or service is covered by the U.S. Munitions List, its 
export is regulated by the Department of State, except as indicated 
otherwise in this subchapter. For the relationship of this subchapter to 
regulations of the Department of Commerce, the Department of Energy and 
the Nuclear Regulatory Commission, see Sec. 123.20 of this subchapter. 
The Treasury Department controls permanent imports of articles and 
services covered by the U.S. Munitions Import List from foreign 
countries by persons subject to U.S. jurisdiction (31 CFR part 505). The 
Department of Commerce regulates the export of items on the Commerce 
Control List (CCL) under the Export Administration Regulations (15 CFR 
parts 768-799).



Sec. 120.6  Defense article.

    Defense article means any item or technical data designated in 
Sec. 121.1 of this subchapter. The policy described in Sec. 120.3 is 
applicable to designations of additional items. This term includes 
technical data recorded or stored in any physical form, models, mockups 
or

[[Page 330]]

other items that reveal technical data directly relating to items 
designated in Sec. 121.1 of this subchapter. It does not include basic 
marketing information on function or purpose or general system 
descriptions.



Sec. 120.7  Significant military equipment.

    (a) Significant military equipment means articles for which special 
export controls are warranted because of their capacity for substantial 
military utility or capability.
    (b) Significant military equipment includes:
    (1) Items in Sec. 121.1 of this subchapter which are preceded by an 
asterisk; and
    (2) All classified articles enumerated in Sec. 121.1 of this 
subchapter.
[58 FR 39283, July 22, 1993, as amended at 62 FR 67275, Dec. 24, 1997]



Sec. 120.8  Major defense equipment.

    Pursuant to section 47(6) of the Arms Export Control Act (22 U.S.C. 
2794(6) note), major defense equipment means any item of significant 
military equipment (as defined in Sec. 120.7) on the U.S. Munitions List 
having a nonrecurring research and development cost of more than 
$50,000,000 or a total production cost of more than $200,000,000.



Sec. 120.9  Defense service.

    (a) Defense service means:
    (1) The furnishing of assistance (including training) to foreign 
persons, whether in the United States or abroad in the design, 
development, engineering, manufacture, production, assembly, testing, 
repair, maintenance, modification, operation, demilitarization, 
destruction, processing or use of defense articles;
    (2) The furnishing to foreign persons of any technical data 
controlled under this subchapter (see Sec. 120.10), whether in the 
United States or abroad; or
    (3) Military training of foreign units and forces, regular and 
irregular, including formal or informal instruction of foreign persons 
in the United States or abroad or by correspondence courses, technical, 
educational, or information publications and media of all kinds, 
training aid, orientation, training exercise, and military advice. (See 
also Sec. 124.1.)
    (b) [Reserved]
[62 FR 67275, Dec. 24, 1997]



Sec. 120.10  Technical data.

    (a) Technical data means, for purposes of this subchapter:
    (1) Information, other than software as defined in Sec. 120.10(4), 
which is required for the design, development, production, manufacture, 
assembly, operation, repair, testing, maintenance or modification of 
defense articles. This includes information in the form of blueprints, 
drawings, photographs, plans, instructions and documentation.
    (2) Classified information relating to defense articles and defense 
services;
    (3) Information covered by an invention secrecy order;
    (4) Software as defined in Sec. 121.8(f) of this subchapter directly 
related to defense articles;
    (5) This definition does not include information concerning general 
scientific, mathematical or engineering principles commonly taught in 
schools, colleges and universities or information in the public domain 
as defined in Sec. 120.11. It also does not include basic marketing 
information on function or purpose or general system descriptions of 
defense articles.
    (b) [Reserved]
[58 FR 39283, July 22, 1993, as amended at 61 FR 48831, Sept. 17, 1996]



Sec. 120.11  Public domain.

    (a) Public domain means information which is published and which is 
generally accessible or available to the public:
    (1) Through sales at newsstands and bookstores;
    (2) Through subscriptions which are available without restriction to 
any individual who desires to obtain or purchase the published 
information;
    (3) Through second class mailing privileges granted by the U.S. 
Government;
    (4) At libraries open to the public or from which the public can 
obtain documents;
    (5) Through patents available at any patent office;
    (6) Through unlimited distribution at a conference, meeting, 
seminar, trade

[[Page 331]]

show or exhibition, generally accessible to the public, in the United 
States;
    (7) Through public release (i.e., unlimited distribution) in any 
form (e.g., not necessarily in published form) after approval by the 
cognizant U.S. government department or agency (see also 
Sec. 125.4(b)(13) of this subchapter);
    (8) Through fundamental research in science and engineering at 
accredited institutions of higher learning in the U.S. where the 
resulting information is ordinarily published and shared broadly in the 
scientific community. Fundamental research is defined to mean basic and 
applied research in science and engineering where the resulting 
information is ordinarily published and shared broadly within the 
scientific community, as distinguished from research the results of 
which are restricted for proprietary reasons or specific U.S. Government 
access and dissemination controls. University research will not be 
considered fundamental research if:
    (i) The University or its researchers accept other restrictions on 
publication of scientific and technical information resulting from the 
project or activity, or
    (ii) The research is funded by the U.S. Government and specific 
access and dissemination controls protecting information resulting from 
the research are applicable.
    (b) [Reserved]



Sec. 120.12  Office of Defense Trade Controls.

    Office of Defense Trade Controls, Bureau of Politico-Military 
Affairs, Department of State, Washington, DC 20522-0602.



Sec. 120.13  United States.

    United States, when used in the geographical sense, includes the 
several states, the Commonwealth of Puerto Rico, the insular possessions 
of the United States, the District of Columbia, the Commonwealth of the 
Northern Mariana Islands, any territory or possession of the United 
States, and any territory or possession over which the United States 
exercises any powers of administration, legislation, and jurisdiction.



Sec. 120.14  Person.

    Person means a natural person as well as a corporation, business 
association, partnership, society, trust, or any other entity, 
organization or group, including governmental entities. If a provision 
in this subchapter does not refer exclusively to a foreign person 
(Sec. 120.16) or U.S. person (Sec. 120.15), then it refers to both.



Sec. 120.15  U.S. person.

    U.S. person means a person (as defined in section 120.14 of this 
part) who is lawful permanent resident as defined by 8 U.S.C. 
1101(a)(20) or who is a protected individual as defined by 8 U.S.C. 
1324b(a)(3). It also means any corporation, business association, 
partnership, society, trust, or any other entity, organization or group 
that is incorporated to do business in the United States. It also 
includes any governmental (federal, state or local) entity. It does not 
include any foreign person as defined in section 120.16 of this part.
[59 FR 25811, May 18, 1994]



Sec. 120.16  Foreign person.

    Foreign persons means any natural person who is not a lawful 
permanent resident as defined by 8 U.S.C. 1101(a)(20) or who is not a 
protected individual as defined by 8 U.S.C. 1324b(a)(3). It also means 
any foreign corporation, business association, partnership, trust, 
society or any other entity or group that is not incorporated or 
organized to do business in the United States, as well as international 
organizations, foreign governments and any agency or subdivision of 
foreign governments (e.g. diplomatic missions).
[59 FR 25811, May 18, 1994]



Sec. 120.17  Export.

    (a) Export means:
    (1) Sending or taking a defense article out of the United States in 
any manner, except by mere travel outside of the United States by a 
person whose personal knowledge includes technical data; or
    (2) Transferring registration, control or ownership to a foreign 
person of any aircraft, vessel, or satellite covered by

[[Page 332]]

the U.S. Munitions List, whether in the United States or abroad; or
    (3) Disclosing (including oral or visual disclosure) or transferring 
in the United States any defense article to an embassy, any agency or 
subdivision of a foreign government (e.g., diplomatic missions); or
    (4) Disclosing (including oral or visual disclosure) or transferring 
technical data to a foreign person, whether in the United States or 
abroad; or
    (5) Performing a defense service on behalf of, or for the benefit 
of, a foreign person, whether in the United States or abroad.
    (6) A launch vehicle or payload shall not, by reason of the 
launching of such vehicle, be considered an export for purposes of this 
subchapter. However, for certain limited purposes (see Sec. 126.1 of 
this subchapter), the controls of this subchapter may apply to any sale, 
transfer or proposal to sell or transfer defense articles or defense 
services.
    (b) [Reserved]



Sec. 120.18  Temporary import.

    Temporary import means bringing into the United States from a 
foreign country any defense article that is to be returned to the 
country from which it was shipped or taken, or any defense article that 
is in transit to another foreign destination. Temporary import includes 
withdrawal of a defense article from a customs bonded warehouse or 
foreign trade zone for the purpose of returning it to the country of 
origin or country from which it was shipped or for shipment to another 
foreign destination. Permanent imports are regulated by the Department 
of the Treasury (see 27 CFR parts 47, 178 and 179).



Sec. 120.19  Reexport or retransfer.

    Reexport or retransfer means the transfer of defense articles or 
defense services to an end use, end user or destination not previously 
authorized.



Sec. 120.20  License.

    License means a document bearing the word license issued by the 
Director, Office of Defense Trade Controls or his authorized designee 
which permits the export or temporary import of a specific defense 
article or defense service controlled by this subchapter.



Sec. 120.21  Manufacturing license agreement.

    An agreement (e.g., contract) whereby a U.S. person grants a foreign 
person an authorization to manufacture defense articles abroad and which 
involves or contemplates:
    (a) The export of technical data (as defined in Sec. 120.10) or 
defense articles or the performance of a defense service; or
    (b) The use by the foreign person of technical data or defense 
articles previously exported by the U.S. person. (See part 124 of this 
subchapter).



Sec. 120.22  Technical assistance agreement.

    An agreement (e.g., contract) for the performance of a defense 
service(s) or the disclosure of technical data, as opposed to an 
agreement granting a right or license to manufacture defense articles. 
Assembly of defense articles is included under this section, provided 
production rights or manufacturing know-how are not conveyed. Should 
such rights be transferred, Sec. 120.21 is applicable. (See part 124 of 
this subchapter).



Sec. 120.23  Distribution agreement.

    An agreement (e.g., a contract) to establish a warehouse or 
distribution point abroad for defense articles exported from the United 
States for subsequent distribution to entities in an approved sales 
territory (see part 124 of this subchapter).



Sec. 120.24  District Director of Customs.

    District Director of Customs means the District Directors of Customs 
at Customs Headquarters Ports (other than the port of New York City, New 
York, where it is the Area Director of Customs); the Regional 
Commissioners of Customs, the Deputy and Assistant Regional 
Commissioners of Customs for Customs Region II at the Port of New York, 
New York; and Port Directors at Customs ports not designated as 
Headquarters Ports.



Sec. 120.25  Empowered Official.

    (a) Empowered Official means a U.S. person who:

[[Page 333]]

    (1) Is directly employed by the applicant or a subsidiary in a 
position having authority for policy or management within the applicant 
organization; and
    (2) Is legally empowered in writing by the applicant to sign license 
applications or other requests for approval on behalf of the applicant; 
and
    (3) Understands the provisions and requirements of the various 
export control statutes and regulations, and the criminal liability, 
civil liability and administrative penalties for violating the Arms 
Export Control Act and the International Traffic in Arms Regulations; 
and
    (4) Has the independent authority to:
    (i) Enquire into any aspect of a proposed export or temporary import 
by the applicant, and
    (ii) Verify the legality of the transaction and the accuracy of the 
information to be submitted; and
    (iii) Refuse to sign any license application or other request for 
approval without prejudice or other adverse recourse.
    (b) [Reserved]



Sec. 120.26  Presiding Official.

    Presiding Official means a person authorized by the U.S. Government 
to conduct hearings in administrative proceedings.



Sec. 120.27  U.S. criminal statutes.

    (a) For purposes of this subchapter, the phrase U.S. criminal 
statutes means:
    (1) Section 38 of the Arms Export Control Act (22 U.S.C. 2778);
    (2) Section 11 of the Export Administration Act of 1979 (50 U.S.C. 
app. 2410);
    (3) Sections 793, 794, or 798 of title 18, United States Code 
(relating to espionage involving defense or classified information);
    (4) Section 16 of the Trading with the Enemy Act (50 U.S.C. app. 
16);
    (5) Section 206 of the International Emergency Economic Powers Act 
(relating to foreign assets controls; 50 U.S.C. 1705);
    (6) Section 30A of the Securities Exchange Act of 1934 (15 U.S.C. 
78dd-1) or section 104 of the Foreign Corrupt Practices Act (15 U.S.C. 
78dd-2);
    (7) Chapter 105 of title 18, United States Code (relating to 
sabotage);
    (8) Section 4(b) of the Internal Security Act of 1950 (relating to 
communication of classified information; 50 U.S.C. 783(b));
    (9) Sections 57, 92, 101, 104, 222, 224, 225, or 226 of the Atomic 
Energy Act of 1954 (42 U.S.C. 2077, 2122, 2131, 2134, 2272, 2274, 2275, 
and 2276);
    (10) Section 601 of the National Security Act of 1947 (relating to 
intelligence identities protection; 50 U.S.C. 421);
    (11) Section 603(b) or (c) of the Comprehensive Anti-Apartheid Act 
of 1986 (22 U.S.C. 5113(b) and (c)); and
    (12) Section 371 of title 18, United States Code (when it involves 
conspiracy to violate any of the above statutes).
    (b) [Reserved]



Sec. 120.28  Listing of forms referred to in this subchapter.

    The forms referred to in this subchapter are available from the 
following government agencies:
    (a) Department of State, Bureau of Politico-Military Affairs, Office 
of Defense Trade Controls, Washington, DC. 20522-0602.
    (1) Application/License for permanent export of unclassified defense 
articles and related technical data (Form DSP-5).
    (2) Application for registration (Form DSP-9).
    (3) Application/License for temporary import of unclassified defense 
articles (Form DSP-61).
    (4) Application/License for temporary export of unclassified defense 
articles (Form DSP-73).
    (5) Non-transfer and use certificate (Form DSP-83).
    (6) Application/License for permanent/temporary export or temporary 
import of classified defense articles and related classified technical 
data (Form DSP-85).
    (7) Authority to Export Defense Articles and Defense Services sold 
under the Foreign Military Sales program (Form DSP-94).
    (b) Department of Commerce, Bureau of Export Administration:
    (1) International Import Certificate (Form BXA-645P/ATF-4522/DSP-
53).
    (2) Shipper's Export Declaration (Form No. 7525-V).

[[Page 334]]

    (3) Department of Defense, Defense Security Assistance Agency: 
Letter of Offer and Acceptance (DD Form 1513).



Sec. 120.29  Missile Technology Control Regime.

    (a) For purposes of this subchapter, Missile Technology Control 
Regime (MTCR) means the policy statement between the United States, the 
United Kingdom, the Federal Republic of Germany, France, Italy, Canada, 
and Japan, announced on April 16, 1987, to restrict sensitive missile-
relevant transfers based on the MTCR Annex, and any amendments thereto;
    (b) The term MTCR Annex means the Guidelines and Equipment and 
Technology Annex of the MTCR, and any amendments thereto;
    (c) List of all items on the MTCR Annex. Section 71(a) of the Arms 
Export Control Act (22 U.S.C. Sec. 2797) refers to the establishment as 
part of the U.S. Munitions List of a list of all items on the MTCR 
Annex, the export of which is not controlled under section 6(l) of the 
Export Administration Act of 1979 (50 U.S.C. app. 2405(l)), as amended. 
In accordance with this provision, the list of MTCR Annex items shall 
constitute all items on the U.S. Munitions List in Sec. 121.16 of this 
subchapter.



PART 121--THE UNITED STATES MUNITIONS LIST--Table of Contents




                         Enumeration of Articles

Sec.
121.1  General. The United States Munitions List.
121.2  Interpretations of the U.S. Munitions List and the Missile 
          Technology Control Regime Annex.
121.3  Aircraft and related articles.
121.4  Amphibious vehicles.
121.5  Apparatus and devices under Category IV(c).
121.6  Cartridge and shell casings.
121.7  Chemical agents.
121.8  End-items, components, accessories, attachments, parts, firmware, 
          software and systems.
121.9  Firearms.
121.10  Forgings, castings and machined bodies.
121.11  Military demolition blocks and blasting caps.
121.12  Military explosives and propellants.
121.13  Military fuel thickeners.
121.14  [Reserved]
121.15  Vessels of war and special naval equipment.
121.16  Missile Technology Control Regime Annex.

    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629 Arms Export Control 
Act, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); E.O. 11958, 42 FR 4311; 
22 U.S.C. 2658.

    Source:  58 FR 39287, July 22, 1993, unless otherwise noted.

                         Enumeration of Articles



Sec. 121.1  General. The United States Munitions List.

    (a) The following articles, services and related technical data are 
designated as defense articles and defense services pursuant to sections 
38 and 47(7) of the Arms Export Control Act (22 U.S.C. 2778 and 
2794(7)). Changes in designations will be published in the Federal 
Register. Information and clarifications on whether specific items are 
defense articles and services under this subchapter may appear 
periodically in the Defense Trade News published by the Center for 
Defense Trade.
    (b) Significant military equipment: An asterisk precedes certain 
defense articles in the following list. The asterisk means that the 
article is deemed to be ``significant military equipment'' to the extent 
specified in Sec. 120.19. The asterisk is placed as a convenience to 
help identify such articles.
    (c) Missile Technology Control Regime Annex (MTCR). Certain defense 
articles and services are identified in Sec. 121.16 as being on the list 
of MTCR Annex items on the United States Munitions List. These are 
articles as specified in Sec. 120.29 of this subchapter and appear on 
the list at Sec. 121.16.

                          Category I--Firearms

    *(a) Nonautomatic, semi-automatic and fully automatic firearms to 
caliber .50 inclusive, and all components and parts for such firearms. 
(See Sec. 121.9 and Secs. 123.16-123.19 of this subchapter.)
    (b) Riflescopes manufactured to military specifications, and 
specifically designed or modified components therefor; firearm silencers 
and suppressors, including flash suppressors.
    *(c) Insurgency-counterinsurgency type firearms or other weapons 
having a special military application (e.g. close assault weapons 
systems) regardless of caliber and all components and parts therefor.

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    (d) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (c) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated SME.

                    Category II--Artillery Projectors

    *(a) Guns over caliber .50, howitzers, mortars, and recoilless 
rifles.
    *(b) Military flamethrowers and projectors.
    (c) Components, parts, accessories and attachments for the articles 
in paragraphs (a) and (b) of this category, including but not limited to 
mounts and carriages for these articles.
    (d) Technical data (as defined in 120.21 of this subchapter) and 
defense services (as defined in Sec. 120.8 of this subchapter) directly 
related to the defense articles enumerated in paragraphs (a) through (c) 
of this category. (See Sec. 125.4 of this subchapter for exemptions.) 
Technical data directly related to the manufacture or production of any 
defense articles enumerated elsewhere in this category that are 
designated as Significant Military Equipment (SME) shall itself be 
designated SME.

                        Category III--Ammunition

    *(a) Ammunition for the arms in Categories I and II of this section. 
(See Sec. 121.6.)
    (b) Components, parts, accessories, and attachments for articles in 
paragraph (a) of this category, including but not limited to cartridge 
cases, powder bags, bullets, jackets, cores, shells (excluding shotgun 
shells), projectiles, boosters, fuzes and components therefor, primers, 
and other detonating devices for such ammunition. (See Sec. 121.6.)
    (c) Ammunition belting and linking machines.
    *(d) Ammunition manufacturing machines and ammunition loading 
machines (except handloading ones).
    (e) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (d) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated SME.

   Category IV--Launch Vehicles, Guided Missiles, Ballistic Missiles, 
                   Rockets, Torpedoes, Bombs and Mines

    *(a) Rockets (including but not limited to meteorological and other 
sounding rockets), bombs, grenades, torpedoes, depth charges, land and 
naval mines, as well as launchers for such defense articles, and 
demolition blocks and blasting caps. (See Sec. 121.11.)
    *(b) Launch vehicles and missile and anti-missile systems including 
but not limited to guided, tactical and strategic missiles, launchers, 
and systems.
    (c) Apparatus, devices, and materials for the handling, control, 
activation, monitoring, detection, protection, discharge, or detonation 
of the articles in paragraphs (a) and (b) of this category. (See 
Sec. 121.5.)
    *(d) Missile and space launch vehicle powerplants.
    *(e) Military explosive excavating devices.
    *(f) Ablative materials fabricated or semi-fabricated from advanced 
composites (e.g., silica, graphite, carbon, carbon/carbon, and boron 
filaments) for the articles in this category that are derived directly 
from or specifically developed or modified for defense articles.
    *(g) Non/nuclear warheads for rockets and guided missiles.
    (h) All specifically designed or modified components, parts, 
accessories, attachments, and associated equipment for the articles in 
this category.
    (i) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (h) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated SME.

   Category V--Explosives, Propellants, Incendiary Agents, and Their 
                              Constituents

    *(a) Military explosives. (See Sec. 121.12.)
    *(b) Military fuel thickeners. (See Sec. 121.13.)
    (c) Propellants for the articles in Categories III and IV of this 
section. (See Sec. 121.14.)
    (d) Military pyrotechnics, except pyrotechnic materials having dual 
military and commercial use.
    (e) All compounds specifically formulated for the articles in this 
category.
    (f) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (e) of this category.

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(See Sec. 125.4 of this subchapter for exemptions.) Technical data 
directly related to the manufacture or production of any defense 
articles enumerated elsewhere in this category that are designated as 
Significant Military Equipment (SME) shall itself be designated SME.

        Category VI--Vessels of War and Special Naval Equipment.

    *(a) Warships, amphibious warfare vessels, landing craft, mine 
warfare vessels, patrol vessels and any vessels specifically designed or 
modified for military purposes. (See Sec. 121.15.)
    (b) Patrol craft without armor, armament or mounting surfaces for 
weapon systems more significant than .50 caliber machine guns or 
equivalent and auxiliary vessels. (See Sec. 121.15.)
    *(c) Turrets and gun mounts, arresting gear, special weapons 
systems, protective systems, submarine storage batteries, catapults, 
mine sweeping equipment (including mine countermeasures equipment 
deployed by aircraft) and other significant naval systems specifically 
designed or modified for combatant vessels.
    (d) Harbor entrance detection devices (magnetic, pressure, and 
acoustic) and controls therefor.
    *(e) Naval nuclear propulsion plants, their land prototypes, and 
special facilities for their construction, support, and maintenance. 
This includes any machinery, device, component, or equipment 
specifically developed, designed or modified for use in such plants or 
facilities. (See Sec. 123.20)
    (f) All specifically designed or modified components, parts, 
accessories, attachments, and associated equipment for the articles in 
paragraphs (a) through (e) of this category.
    (g) Technical data (as defined in Sec. 120.10) and defense services 
(as defined in Sec. 120.9) directly related to the defense articles 
enumerated in paragraphs (a) through (f) of this category. (See 
Sec. 125.4 for exemptions.) Technical data directly related to the 
manufacture or production of any defense articles enumerated elsewhere 
in this category that are designated as Significant Military Equipment 
(SME) shall itself be designated SME.

                Category VII--Tanks and Military Vehicles

    *(a) Military type armed or armored vehicles, military railway 
trains, and vehicles specifically designed or modified to accommodate 
mountings for arms or other specialized military equipment or fitted 
with such items.
    *(b) Military tanks, combat engineer vehicles, bridge launching 
vehicles, half-tracks and gun carriers.
    *(c) Self-propelled guns and howitzers.
    (d) Military trucks, trailers, hoists, and skids specifically 
designed, modified, or equipped to mount or carry weapons of Categories 
I, II and IV or for carrying and handling the articles in paragraph (a) 
of Categories III and IV.
    *(e) Military recovery vehicles.
    *(f) Amphibious vehicles. (See Sec. 121.4)
    *(g) Engines specifically designed or modified for the vehicles in 
paragraphs (a), (b), (c), and (f) of this category.
    (h) All specifically designed or modified components and parts, 
accessories, attachments, and associated equipment for the articles in 
this category, including but not limited to military bridging and deep 
water fording kits.
    (i) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (h) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated SME.

            Category VIII--Aircraft and Associated Equipment

    *(a) Aircraft, including but not limited to helicopters, non-
expansive balloons, drones, and lighter-than-air aircraft, which are 
specifically designed, modified, or equipped for military purposes. This 
includes but is not limited to the following military purposes: Gunnery, 
bombing, rocket or missile launching, electronic and other surveillance, 
reconnaissance, refueling, aerial mapping, military liaison, cargo 
carrying or dropping, personnel dropping, airborne warning and control, 
and military training. (See Sec. 121.3.)
    *(b) Military aircraft engines, except reciprocating engines, 
specifically designed or modified for the aircraft in paragraph (a) of 
this category.
    *(c) Cartridge-actuated devices utilized in emergency escape of 
personnel and airborne equipment (including but not limited to airborne 
refueling equipment) specifically designed or modified for use with the 
aircraft and engines of the types in paragraphs (a) and (b) of this 
category.
    (d) Launching and recovery equipment for the articles in paragraph 
(a) of this category, if the equipment is specifically designed or 
modified for military use. Fixed land-based arresting gear is not 
included in this category.
    *(e) Inertial navigation systems, aided or hybrid inertial 
navigation systems, Inertial Measurement Units (IMUs), and Attitude and 
Heading Reference Systems (AHRS) specifically designed, modified, or 
configured for military use and all specifically designed

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components, parts and accessories. For other inertial reference systems 
and related components refer to Category XII(d).
    (f) Developmental aircraft, engines, and components thereof 
specifically designed, modified, or equipped for military uses or 
purposes, or developed principally with U.S. Department of Defense 
funding, excluding such aircraft, engines, and components subject to the 
jurisdiction of the Department of Commerce.

    Note: Developmental aircraft, engines, and components thereof, 
having no commercial application at the time of this amendment and which 
have been specifically designed for military uses or purposes, or 
developed principally with U.S. Department of Defense funding, will be 
considered eligible for a CCL license when actually applied to a 
commercial aircraft or commercial aircraft engine program. Exporters may 
seek to establish commercial application either on a case-by-case basis 
through submission of documentation demonstrating application to a 
commercial program in requesting an export license application from 
Commerce in respect of a specific export or, in the case of use for 
broad categories of aircraft, engines, or components, a commodity 
jurisdiction from State.


    *(g) Ground effect machines (GEMS) specifically designed or modified 
for military use, including but not limited to surface effect machines 
and other air cushion vehicles, and all components, parts, and 
accessories, attachments, and associated equipment specifically designed 
or modified for use with such machines.
    (h) Components, parts, accessories, attachments, and associated 
equipment (including ground support equipment) specifically designed or 
modified for the articles in paragraphs (a) through (e) of this 
category, excluding aircraft tires and propellers used with 
reciprocating engines.
    (i) Technical data (as defined in Sec. 120.10) and defense services 
(as defined in Sec. 120.9) directly related to the defense articles 
enumerated in paragraphs (a) through (h) of this category (see 
Sec. 125.4 for exemptions), except for hot section technical data 
associated with commercial aircraft engines. Technical data directly 
related to the manufacture or production of any defense articles 
enumerated elsewhere in this category that are designated as Significant 
Military Equipment (SME) shall itself be designated SME.

                Category IX--Military Training Equipment

    (a) Military training equipment including but not limited to attack 
trainers, radar target trainers, radar target generators, gunnery 
training devices, antisubmarine warfare trainers, target equipment, 
armament training units, operational flight trainers, air combat 
training systems, radar trainers, navigation trainers, and simulation 
devices related to defense articles.
    (b) Components, parts, accessories, attachments, and associated 
equipment specifically designed or modified for the articles in 
paragraph (a) of this category.
    (c) Technical Data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
and (b) of this category. (See Sec. 125.4 for exemptions.).

               Category X--Protective Personnel Equipment

    (a) Body armor specifically designed, modified or equipped for 
military use; articles, including but not limited to clothing, designed, 
modified or equipped to protect against or reduce detection by radar, 
infrared (IR) or other sensors; military helmets equipped with 
communications hardware, optical sights, slewing devices or mechanisms 
to protect against thermal flash or lasers, excluding standard military 
helmets.
    (b) Partial pressure suits and liquid oxygen converters used in 
aircraft in Category VIII(a).
    (c) Protective apparel and equipment specifically designed or 
modified for use with the articles in paragraphs (a) through (d) in 
Category XIV.
    (d) Components, parts, accessories, attachments, and associated 
equipment specifically designed or modified for use with the articles in 
paragraphs (a), (b), and (c) of this category.
    (e) Technical Data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (d) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.)

                    Category XI--Military Electronics

    (a) Electronic equipment not included in Category XII of the U.S. 
Munitions List which is specifically designed, modified or configured 
for military application. This equipment includes but is not limited to:
    *(1) Underwater sound equipment to include active and passive 
detection, identification, tracking, and weapons control equipment.
    *(2) Underwater acoustic active and passive countermeasures and 
counter-countermeasures.
    (3) Radar systems, with capabilities such as:
    *(i) Search,
    *(ii) Acquisition,
    *(iii) Tracking,
    *(iv) Moving target indication,
    *(v) Imaging radar systems,

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    (vi) Any ground air traffic control radar which is specifically 
designed or modified for military application.
    *(4) Electronic combat equipment, such as:
    (i) Active and passive countermeasures,
    (ii) Active and passive counter-countermeasures, and
    (iii) Radios (including transceivers) specifically designed or 
modified to interfere with other communication devices or transmissions.
    *(5) Command, control and communications systems to include radios 
(transceivers), navigation, and identification equipment.
    (6) Computers specifically designed or developed for military 
application and any computer specifically modified for use with any 
defense article in any category of the U.S. Munitions List.
    (7) Any experimental or developmental electronic equipment 
specifically designed or modified for military application or 
specifically designed or modified for use with a military system.
    *(b) Electronic systems or equipment specifically designed, 
modified, or configured for intelligence, security, or military purposes 
for use in search, reconnaissance, collection, monitoring, direction-
finding, display, analysis and production of information from the 
electromagnetic spectrum and electronic systems or equipment designed or 
modified to counteract electronic surveillance or monitoring. A system 
meeting this definition is controlled under this subchapter even in 
instances where any individual pieces of equipment constituting the 
system may be subject to the controls of another U.S. Government agency. 
Such systems or equipment described above include, but are not limited 
to, those:
    (1) Designed or modified to use cryptographic techniques to generate 
the spreading code for spread spectrum or hopping code for frequency 
agility. This does not include fixed code techniques for spread 
spectrum.
    (2) Designed or modified using burst techniques (e.g., time 
compression techniques) for intelligence, security or military purposes.
    (3) Designed or modified for the purpose of information security to 
suppress the compromising emanations of information-bearing signals. 
This covers TEMPEST suppression technology and equipment meeting or 
designed to meet government TEMPEST standards. This definition is not 
intended to include equipment designed to meet Federal Communications 
Commission (FCC) commercial electro-magnetic interference standards or 
equipment designed for health and safety.
    (c) Components, parts, accessories, attachments, and associated 
equipment specifically designed or modified for use with the equipment 
in paragraphs (a) and (b) of this category, except for such items as are 
in normal commercial use.
    (d) Technical data (as defined in Sec. 120.21) and defense services 
(as defined in Sec. 120.8) directly related to the defense articles 
enumerated in paragraphs (a) through (c) of this category. (See 
Sec. 125.4 for exemptions.) Technical data directly related to the 
manufacture or production of any defense articles enumerated elsewhere 
in this category that are designated as Significant Military Equipment 
(SME) shall itself be designated as SME.

   Category XII--Fire Control, Range Finder, Optical and Guidance and 
                            Control Equipment

    *(a) Fire control systems; gun and missile tracking and guidance 
systems; gun range, position, height finders, spotting instruments and 
laying equipment; aiming devices (electronic, optic, and acoustic); bomb 
sights, bombing computers, military television sighting and viewing 
units, and periscopes for the articles of this section.
    *(b) Lasers specifically designed, modified or configured for 
military application including those used in military communication 
devices, target designators and range finders, target detection systems, 
and directed energy weapons.
    *(c) Infrared focal plane array detectors specifically designed, 
modified or configured for military use; image intensification and other 
night sighting equipment or systems specifically designed, modified, or 
configured for military use; second generation and above military image 
intensification tubes (defined below) specifically designed, developed, 
modified or configured for military use, and infrared, visible and 
ultraviolet devices specifically designed, developed, modified, or 
configured for military application. Military second and third 
generation image intensification tubes and military infrared focal plane 
arrays identified in this subparagraph are licensed by the Department of 
Commerce (ECCN 6A02A and 6A03A) when a part of a commercial system (i.e. 
those systems originally designed for commercial use). This does not 
include any military system comprised of non-military specification 
components. Replacement tubes or focal plane arrays identified in this 
paragraph being exported for commercial systems are subject to the 
controls of the ITAR.

    Note: Special Definition. For purposes of this subparagraph, second 
and third generation image intensification tubes are defined as having:


    A peak response within the 0.4 to 1.05 micron wavelength range and 
incorporating a microchannel plate for electron image amplification 
having a hold pitch (center-to-

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center spacing) of less than 25 microns and having either:
    (a) An S-20, S-25 or multialkali photocathode; or
    (b) A GaAs, GaInAs, or other compound semiconductor photocathode.

    *(d) Inertial platforms and sensors for weapons or weapon systems; 
guidance, control and stabilization systems except for those systems 
covered in Category VIII; astro-compasses and star trackers and military 
accelerometers and gyros. For aircraft inertial reference systems and 
related components refer to Category VIII.
    (e) Components, parts, accessories, attachments and associated 
equipment specifically designed or modified for the articles in 
paragraphs (a) through (d) of this category, except for such items as 
are in normal commercial use.
    (f) Technical data (as defined in Sec. 120.21) and defense services 
(as defined in Sec. 120.8) directly related to the defense articles 
enumerated in paragraphs (a) through (e) of this category. (See 
Sec. 125.4 for exemptions.) Technical data directly related to 
manufacture and production of any defense articles enumerated elsewhere 
in this category that are designated as Significant Military Equipment 
(SME) shall itself be designated as SME.

               Category XIII--Auxiliary Military Equipment

    (a) Cameras and specialized processing equipment therefor, 
photointerpretation, stereoscopic plotting, and photogrammetry equipment 
which are specifically designed or modified for military purposes, and 
components specifically designed or modified therefor;
    (b) Military Information Security Systems and equipment, 
cryptographic devices, software, and components specifically designed or 
modified therefor (i.e., such items when specifically designed, 
developed, configured, adapted or modified for military applications 
(including command, control and intelligence applications)). This 
includes:
    (1) Military cryptographic (including key management) systems, 
equipment, assemblies, modules, integrated circuits, components or 
software with the capability of maintaining secrecy or confidentiality 
of information or information systems, except cryptographic equipment 
and software as follows:
    (i) Tracking, telemetry and control (TT&C) encryption/decryption 
when embedded in a commercial communications satellite identified in 
ECCN 9A004a of the Export Administration Regulations; embedded means 
that the device or system cannot feasibility be removed from the 
satellite and that it cannot be used for other purposes.
    (2) Military cryptographic (including key management) systems, 
equipment, assemblies, modules, integrated circuits, components of 
software which have the capability of generating spreading or hopping 
codes for spread spectrum systems or equipment.
    (3) Military cryptanalytic systems, equipment, assemblies, modules, 
integrated circuits, components or software.
    (4) Military systems, equipment, assemblies, modules, integrated 
circuits, components or software providing certified or certifiable 
multi-level security or user isolation exceeding class B2 of the Trusted 
Computer System Evaluation Criteria (TCSEC) and software to certify such 
systems, equipment or software.
    (5) Ancillary equipment specifically designed or modified for 
paragraphs (b) (1), (2), (3), and (4) of this category.
    (c) Self-contained diving and underwater breathing apparatus as 
follows:
    (1) Closed and semi-closed circuits (rebreathing) apparatus;
    (2) Specially designed components for use in the conversion of open-
circuit apparatus to military use; and
    (3) Articles exclusively designed for military use with self-
contained diving and underwater swimming apparatus.
    (d) Carbon/carbon billets and preforms which are reinforced with 
continuous unidirectional tows, tapes, or woven cloths in three or more 
dimensional planes (i.e. 3D, 4D, etc.). This is exclusive of carbon/
carbon billets and preforms where reinforcement in the third dimension 
is limited to interlocking of adjacent layers only, and carbon/carbon 
3D, 4D, etc. end items which have not been specifically designed or 
modified for defense articles (e.g., brakes for commercial aircraft or 
high speed trains). Armor (e.g., organic, ceramic, metallic), and 
reactive armor which has been specifically designed or modified for 
defense articles. Structural materials including carbon/carbon and metal 
matrix composites, plate, forgings, castings, welding consumables and 
rolled and extruded shapes which have been specifically designed or 
modified for defense articles.
    (e) Concealment and deception equipment, including but not limited 
to special paints, decoys, and simulators and components, parts and 
accessories specifically designed or modified therefor.
    (f) Energy conversion devices for producing electrical energy from 
nuclear, thermal, or solar energy, or from chemical reaction which are 
specifically designed or modified for military application.
    (g) Chemiluminescent compounds and solid state devices specifically 
designed or modified for military application.
    (h) Devices embodying particle beam and electromagnetic pulse 
technology and associated components and subassemblies (e.g.,

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ion beam current injectors, particle accelerators for neutral or charged 
particles, beam handling and projection equipment, beam steering, fire 
control, and pointing equipment, test and diagnostic instruments, and 
targets) which are specifically designed or modified for directed energy 
weapon applications.
    (i) Metal embrittling agents.
    *(j) Hardware and equipment, which has been specifically designed or 
modified for military applications, that is associated with the 
measurement or modification of system signatures for detection of 
defense articles. This includes but is not limited to signature 
measurement equipment; prediction techniques and codes; signature 
materials and treatments; and signature control design methodology.
    (k) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
related to the defense articles listed in this category. (See Sec. 125.4 
of this subchapter for exemptions; see also Sec. 123.21 of this 
subchapter). Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated as SME.

   Category XIV--Toxicological Agents and Equipment and Radiological 
                                Equipment

    *(a) Chemical agents, including but not limited to lung irritants, 
vesicants, lachrymators, tear gases (except tear gas formulations 
containing 1% or less CN or CS), sternutators and irritant smoke, and 
nerve gases and incapacitating agents. (See Sec. 121.7.)
    *(b) Biological agents.
    *(c) Equipment for dissemination, detection, and identification of, 
and defense against, the articles in paragraphs (a) and (b) of this 
category.
    *(d) Nuclear radiation detection and measuring devices, manufactured 
to military specification.
    (e) Components, parts, accessories, attachments, and associated 
equipment specifically designed or modified for the articles in 
paragraphs (c) and (d) of this category.
    (f) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
related to the defense articles enumerated in paragraphs (a) through (e) 
of this category. (See Sec. 125.4 of this subchapter for exemptions; see 
also Sec. 123.21 of this subchapter). Technical data directly related to 
the manufacture or production of any defense articles enumerated 
elsewhere in this category that are designated as Significant Military 
Equipment (SME) shall itself be designated as SME.

        Category XV--Spacecraft Systems and Associated Equipment

    * (a) Spacecraft, including satellites, specifically designed or 
modified for military use.
    (b) Remote sensing satellite systems as follows:
    *(1) All Remote sensing satellites;
    (2) Ground control stations for remote sensing satellites as 
follows:
    (i) Ground control stations for telemetry, tracking and control of 
such satellites; or
    (ii) Passive ground stations for remote sensing satellites having 
any of the following characteristics:
    (A) Employing any of the cryptographic items controlled under 
Category XIII of this subchapter; or
    (B) Employing any uplink command capability.

    Note: For export licensing controls over any passive ground receive 
only stations for remote sensing satellites not having any of the above 
parameters nor any systems or major components controlled elsewhere 
under this subchapter, see the Commerce Control List.

    *(c) Military communications satellites or multi-mission satellites 
(including commercial communications satellites having additional, non-
communication mission(s) or payload(s) controlled under this subchapter 
but not including ground stations and their associated equipment and 
technical data not enumerated elsewhere in Sec. 121.1 of this 
subchapter; for controls on such ground stations see the Commerce 
Control List).
    (d) Global Positioning System (GPS) receiving equipment specifically 
designed, modified or configured for military use; or GPS receiving 
equipment with any of the following characteristics:
    (1) Designed for encryption or decryption (e.g., Y-Code) of GPS 
precise positioning service (PPS) signals;
    (2) Designed for producing navigation results above 60,000 feet 
altitude and at 1,000 knots velocity or greater;
    (3) Specifically designed or modified for use with a null steering 
antenna or including a null steering antenna designed to reduce or avoid 
jamming signals;
    (4) Designed or modified for use with unmanned air vehicle systems 
capable of delivering at least a 500 kg payload to a range of at least 
300 km.

    Note: GPS receivers designed or modified for use with military 
unmanned air vehicle systems with less capability are considered to be 
specifically designed, modified or configured for military use and 
therefore covered under this paragraph (d)(4).)

    Any GPS equipment not meeting this definition is subject to the 
jurisdiction of the

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Department of Commerce (DOC). Manufacturers or exporters of equipment 
under DOC jurisdiction are advised that the U.S. Government does not 
assure the availability of the GPS P-Code for civil navigation. It is 
the policy of the Department of Defense (DOD) that GPS receivers using 
P-Code without clarification as to whether or not those receivers were 
designed or modified to use Y-Code will be presumed to be Y-Code capable 
and covered under this paragraph. The DOD policy further requires that a 
notice be attached to all P-Code receivers presented for export. The 
notice must state the following: ``ADVISORY NOTICE: This receiver uses 
the GPS P-Code signal, which by U.S. policy, may be switched off without 
notice.''
    (e) Systems, components, parts, accessories, attachments, and 
associated equipment (including ground support equipment) specifically 
designed, modified or configured for the articles in paragraphs (a) 
through (d) of this category, except as provided in paragraph (c).
    (f) The following individual systems, components or parts (except 
when included in a commercial communications satellite licensed under 
ECCN 9A004a of the Export Administration Regulations):
    (1) Anti-jam systems with the ability to respond to incoming 
interference by adaptively reducing antenna gain (nulling) in the 
direction of the interference.
    (2) Antennas:
    (i) With aperture (overall dimension of the radiating portions of 
the antenna) greater than 30 feet; or
    (ii) With all sidelobes less than or equal to -35dB, relative to the 
peak of the main beam; or
    (iii) Designed, modified, or configured to provide coverage area on 
the surface of the earth less than 200 nautical miles in diameter, where 
``coverage area'' is defined as that area on the surface of the earth 
that is illuminated by the main beam width of the antenna (which is the 
angular distance between half power points of the beam).
    (3) Intersatellite data relay links that do not involve a ground 
relay terminal (``cross-links'').
    (4) Spaceborne regenerative baseband processing equipment.
    (5) Radiation-hardened microelectronic circuits that are 
specifically designed or rated to meet or exceed all five of the 
following characteristics:
    (i) A total dose of 5 x 105 Rads (SI);
    (ii) A dose rate upset of 5 x 108 Rads (SI)/Sec;
    (iii) A neutron dose of 1 x 1014 N/cm2;
    (iv) A single event upset of 1 x 10-7 or less error/bit/
day;
    (v) Single event latch-up free and having a dose rate latch-up of 
5 x 108 Rads(SI)/sec or greater.
    (6) Propulsion systems which permit acceleration of the satellite 
on-orbit (i.e., after mission orbit injection) at rates greater than 
0.1g.
    (7) Attitude control and determination systems designed to provide 
spacecraft pointing determination and control or payload pointing system 
control better than 0.02 degrees per axis.
    (8) Orbit transfer engines (``kick-motors'') which are embedded in 
the spacecraft. Orbit transfer engines which are not embedded in the 
spacecraft are controlled under Category IV of this subchapter (except 
as noted in the note for this paragraph (f)). Here ``embedded'' means 
that the device or system cannot feasibly be removed from the spacecraft 
and cannot be used for other purposes.
    (9) Cryptographic items described in Category XIII(b)(1)(x) of this 
subchapter.

    Note: Commercial communications satellites are subject to Commerce 
Licensing jurisdiction even if they include the individual munitions 
list systems, components or parts identified in paragraph (f) of this 
category. In all other cases, these systems, components or parts remain 
on the USML except non-embedded, solid propellant orbit transfer engines 
(``kick motors'') are subject to Commerce licensing jurisdiction (and 
not controlled under this subchapter) when they are to be utilized for a 
specific commercial communications satellite launch, provided the solid 
propellant ``kick motor'' being utilized is not specifically designed or 
modified for military use or capable of being restarted after 
achievement of mission orbit (such orbit transfer engines are always 
controlled under Category IV of this subchapter). Technical data (as 
defined in Sec. 120.10 of this subchapter) and defense services (as 
defined in Sec. 120.9 of this subchapter) related to the systems, 
components, or parts referred to in paragraph (f) of this cateory are 
always controlled under this subchapter, even when the satellite itself 
is licensed by the Department of Commerce.

    (g) Technical data (as defined in Sec. 120.10 of this subchapter) 
and defense services (as defined in Sec. 120.9 of this subchapter) 
directly related to paragraphs (a) through (f) of this category. (See 
Sec. 125.4 for exemptions.) Technical data directly related to the 
manufacture or production of any defense articles enumerated elsewhere 
in this category that are designated as Significant Military Equipment 
(SME) shall itself be designated SME. In addition, detailed design, 
development, production or manufacturing data for all spacecraft systems 
and for specifically designed or modified components for all spacecraft 
systems, regardless of which U.S. Government agency has jurisdiction for 
export of the spacecraft. (See Sec. 125.4 for exemptions.) This coverage 
by the U.S. Munitions List of detailed design, development, 
manufacturing or production information directly related to satellites 
which are not otherwise under the

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control of this section does not include that level of technical data 
(including marketing data) necessary and reasonable for a purchaser to 
have assurance that a U.S.-built item intended to operate in space has 
been designed, manufactured and tested in conformance with specified 
contract requirements (e.g., operational performance, reliability, 
lifetime, product quality, or delivery expectations), as well as data 
necessary to evaluate in-orbit anomalies and to operate and maintain 
associated ground equipment.

    Note 1: All defense services and technical assistance for satellites 
and/or launch vehicles, including compatibility, integration, or 
processing data, is controlled under this subchapter. Technical data 
provided to the launch provider (form, fit, function, mass, electrical, 
mechanical, dynamic/environmental, telemetry, safety, facility, launch 
pad access, and launch parameters) for commercial communications 
satellites that describe the interfaces for mating and parameters for 
launch (e.g., orbit, timing) of the satellite is under Commerce 
jurisdiction.

    Note 2: The international space station, being developed, launched 
and operated under the supervision of the National Aeronautics and Space 
Administration, is controlled for export purposes under the Export 
Administration Regulations.

         Category XVI--Nuclear Weapons Design and Test Equipment

    *(a) Any article, material, equipment, or device which is 
specifically designed or modified for use in the design, development, or 
fabrication of nuclear weapons or nuclear explosive devices. (See 
Sec. 123.21 of this subchapter and Department of Commerce Export 
Regulations, 15 CFR part 778).
    *(b) Any article, material, equipment, or device which is 
specifically designed or modified for use in the devising, carrying out, 
or evaluating of nuclear weapons tests or any other nuclear explosions, 
except such items as are in normal commercial use for other purposes.
    (c) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (b) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated SME.

Category XVII--Classified Articles, Technical Data and Defense Services 
                        Not Otherwise Enumerated

    *(a) All articles, technical data (as defined in Sec. 120.21 of this 
subchapter) and defense services (as defined in Sec. 120.8 of this 
subchapter) relating thereto which are classified in the interests of 
national security and which are not otherwise enumerated in the U.S. 
Munitions List.

                       Category XVIII--[Reserved]

                        Category XIX--[Reserved]

Category XX--Submersible Vessels, Oceanographic and Associated Equipment

    *(a) Submersible vessels, manned or unmanned, tethered or 
untethered, designed or modified for military purposes, or powered by 
nuclear propulsion plants.
    *(b) Swimmer delivery vehicles designed or modified for military 
purposes.
    (c) Equipment, components, parts, accessories, and attachments 
specifically designed or modified for any of the articles in paragraphs 
(a) and (b) of this category.
    (d) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (c) of this category. (See Sec. 125.4 of this subchapter for 
exemptions.) Technical data directly related to the manufacture or 
production of any defense articles enumerated elsewhere in this category 
that are designated as Significant Military Equipment (SME) shall itself 
be designated as SME.

                  Category XXI--Miscellaneous Articles

    (a) Any article not specifically enumerated in the other categories 
of the U.S. Munitions List which has substantial military applicability 
and which has been specifically designed or modified for military 
purposes. The decision on whether any article may be included in this 
category shall be made by the Director of the Office of Defense Trade 
Controls.
    (b) Technical data (as defined in Sec. 120.21 of this subchapter) 
and defense services (as defined in Sec. 120.8 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) of 
this category.
[58 FR 39287, July 22, 1993, as amended at 58 FR 47638, Sept. 10, 1993; 
58 FR 60115, Nov. 15, 1993; 59 FR 46548 and 46549, Sept. 9, 1994; 59 FR 
47800, Sept. 19, 1994; 61 FR 56895, Nov. 5, 1996; 61 FR 68633, Dec. 30, 
1996]

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Sec. 121.2  Interpretations of the U.S. Munitions List and the Missile Technology Control Regime Annex.

    The following interpretations (listed alphabetically) explain and 
amplify the terms used in Sec. 121.1. These interpretations have the 
same force as if they were a part of the U.S. Munitions List (USML) 
category to which they refer. In addition, all the items listed in 
Sec. 121.16 shall constitute all items on the United States Munitions 
List which are Missile Technology Control Regime Annex items in 
accordance with section 71(a) of the Arms Export Control Act.



Sec. 121.3  Aircraft and related articles.

    In Category VIII, aircraft means aircraft designed, modified, or 
equipped for a military purpose, including aircraft described as 
``demilitarized.'' All aircraft bearing an original military designation 
are included in Category VIII. However, the following aircraft are not 
included so long as they have not been specifically equipped, re-
equipped, or modified for military operations:
    (a) Cargo aircraft bearing ``C'' designations and numbered C-45 
through C-118 inclusive, C-121 through C-125 inclusive, and C-131, using 
reciprocating engines only.
    (b) Trainer aircraft bearing ``T'' designations and using 
reciprocating engines or turboprop engines with less than 600 horsepower 
(s.h.p.)
    (c) Utility aircraft bearing ``U'' designations and using 
reciprocating engines only.
    (d) All liaison aircraft bearing an ``L'' designation.
    (e) All observation aircraft bearing ``O'' designations and using 
reciprocating engines.



Sec. 121.4  Amphibious vehicles.

    An amphibious vehicle in Category VII(f) is an automotive vehicle or 
chassis which embodies all-wheel drive, is equipped to meet special 
military requirements, and which has sealed electrical systems or 
adaptation features for deep water fording.



Sec. 121.5  Apparatus and devices under Category IV(c).

    Category IV includes but is not limited to the following: Fuzes and 
components specifically designed, modified or configured for items 
listed in that category, bomb racks and shackles, bomb shackle release 
units, bomb ejectors, torpedo tubes, torpedo and guided missile 
boosters, guidance systems equipment and parts, launching racks and 
projectors, pistols (exploders), ignitors, fuze arming devices, 
intervalometers, thermal batteries, hardened missile launching 
facilities, guided missile launchers and specialized handling equipment, 
including transporters, cranes and lifts designed to handle articles in 
paragraphs (a) and (b) of this category for preparation and launch from 
fixed and mobile sites. The equipment in this category includes robots, 
robot controllers and robot end-effectors specially designed or modified 
for military applications.



Sec. 121.6  Cartridge and shell casings.

    Cartridge and shell casings are included in Category III unless, 
prior to export, they have been rendered useless beyond the possibility 
of restoration for use as a cartridge or shell casing by means of 
heating, flame treatment, mangling, crushing, cutting, or popping.



Sec. 121.7  Chemical agents.

    A chemical agent in Category XIV(a) is a substance having military 
application which by its ordinary and direct chemical action produces a 
powerful physiological effect. The term ``chemical agent'' includes, but 
is not limited to, the following chemical compounds:
    (a) Lung irritants:
    (1) Diphenylcyanoarsine (DC).
    (2) Fluorine (but not fluorene).
    (3) Trichloronitro methane (chloropicrin PS).
    (b) Vesicants:
    (1) B-Chlorovinyldichloroarsine (Lewisite, L).
    (2) Bis(dichloroethyl)sulphide (Mustard Gas, HD or H).
    (3) Ethyldichloroarsine (ED).
    (4) Methyldichloroarsine (MD).
    (c) Lachrymators and tear gases:
    (1) A-Bromobenzyl cyanide (BBC).
    (2) Chloroacetophenone (CN).

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    (3) Dibromodimethyl ether.
    (4) Dichlorodimethyl ether (ClCi).
    (5) Ethyldibromoarsine.
    (6) Phenylcarbylamine chloride.
    (7) Tear gas solutions (CNB and CNS).
    (8) Tear gas orthochlorobenzalmalononitrile (CS).
    (d) Sternutators and irritant smokes:
    (1) Diphenylamine chloroarsine (Adamsite, DM).
    (2) Diphenylchloroarsine (BA).
    (3) Liquid pepper.
    (e) Nerve agents, gases and aerosols. These are toxic compounds 
which affect the nervous system, such as:
    (1) Dimethylaminoethoxycyanophosphine oxide (GA).
    (2) Methylisopropoxyfluorophosphine oxide (GB).
    (3) Methylpinacolyloxyfluoriphosphine oxide (GD).
    (f) Antiplant chemicals, such as: Butyl 2-chloro-4-
fluorophenoxyacetate (LNF).



Sec. 121.8  End-items, components, accessories, attachments, parts, firmware, software and systems.

    (a) An end-item is an assembled article ready for its intended use. 
Only ammunition, fuel or another energy source is required to place it 
in an operating state.
    (b) A component is an item which is useful only when used in 
conjunction with an end-item. A major component includes any assembled 
element which forms a portion of an end-item without which the end-item 
is inoperable. (Example: Airframes, tail sections, transmissions, tank 
treads, hulls, etc.) A minor component includes any assembled element of 
a major component.
    (c) Accessories and attachments are associated equipment for any 
component, end-item or system, and which are not necessary for their 
operation, but which enhance their usefulness or effectiveness. 
(Examples: Military riflescopes, special paints, etc.)
    (d) A part is any single unassembled element of a major or a minor 
component, accessory, or attachment which is not normally subject to 
disassembly without the destruction or the impairment of design use. 
(Examples: Rivets, wire, bolts, etc.)
    (e) Firmware and any related unique support tools (such as 
computers, linkers, editors, test case generators, diagnostic checkers, 
library of functions and system test diagnostics) specifically designed 
for equipment or systems covered under any category of the U.S. 
Munitions List are considered as part of the end-item or component. 
Firmware includes but is not limited to circuits into which software has 
been programmed.
    (f) Software includes but is not limited to the system functional 
design, logic flow, algorithms, application programs, operating systems 
and support software for design, implementation, test, operation, 
diagnosis and repair. A person who intends to export software only 
should, unless it is specifically enumerated in Sec. 121.1 (e.g., 
XIII(b)), apply for a technical data license pursuant to part 125 of 
this subchapter.
    (g) A system is a combination of end-items, components, parts, 
accessories, attachments, firmware or software, specifically designed, 
modified or adapted to operate together to perform a specialized 
military function.



Sec. 121.9  Firearms.

    (a) Category I includes revolvers, pistols, rifles, carbines, fully 
automatic rifles, submachine guns, machine pistols and machine guns to 
caliber .50, inclusive. It includes combat shotguns. It excludes other 
shotguns with barrels 18inch; or longer, BB, pellet, and muzzle loading 
(black powder) firearms.
    (b) A firearm is a weapon not over .50 caliber which is designed to 
expel a projectile by the action of an explosive or which may be readily 
converted to do so.
    (c) A rifle is a shoulder firearm which can discharge a bullet 
through a rifled barrel 16 inches or longer.
    (d) A carbine is a lightweight shoulder firearm with a barrel under 
16 inches in length.
    (e) A pistol is a hand-operated firearm having a chamber integral 
with or permanently aligned with the bore.
    (f) A revolver is a hand-operated firearm with a revolving cylinder 
containing chambers for individual cartridges.
    (g) A submachine gun, ``machine pistol'' or ``machine gun'' is a 
firearm originally designed to fire, or capable

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of being fired, fully automatically by a single pull of the trigger.



Sec. 121.10  Forgings, castings and machined bodies.

    Articles on the U.S. Munitions List include articles in a partially 
completed state (such as forgings, castings, extrusions and machined 
bodies) which have reached a stage in manufacture where they are clearly 
identifiable as defense articles. If the end-item is an article on the 
U.S. Munitions List (including components, accessories, attachments and 
parts as defined in Sec. 121.8), then the particular forging, casting, 
extrusion, machined body, etc., is considered a defense article subject 
to the controls of this subchapter, except for such items as are in 
normal commercial use.



Sec. 121.11  Military demolition blocks and blasting caps.

    Military demolition blocks and blasting caps referred to in Category 
IV(a) do not include the following articles:
    (a) Electric squibs.
    (b) No. 6 and No. 8 blasting caps, including electric ones.
    (c) Delay electric blasting caps (including No. 6 and No. 8 
millisecond ones).
    (d) Seismograph electric blasting caps (including SSS, Static-
Master, Vibrocap SR, and SEISMO SR).
    (e) Oil well perforating devices.



Sec. 121.12  Military explosives and propellants.

    (a) Military Explosives in Category V are military explosives or 
energetic materials consisting of high explosives, propellants or low 
explosives, pyrotechnics and high energy solid or liquid fuels, 
including aircraft fuels specially formulated for military purposes. 
Military explosives are solid, liquid or gaseous substances or mixtures 
of substances which, in their application as primary, booster or main 
charges in warheads, demolition and other military applications, are 
required to detonate.
    Military explosives, military propellants and military pyrotechnics 
in Category V include substances or mixtures containing any of the 
following:
    (1) Spherical aluminum powder of particle size 60 micrometres or 
less manufactured from material with an aluminum content of 99% or more;
    (2) Metal fuels in particle sizes less than 60 micrometres whether 
spherical, atomized, spheroidal, flaked or ground, manufactured from 
material consisting of 99% or more of any of the following: Zirconium, 
magnesium and alloys of these; beryllium; fine iron powder with average 
particle size of 3 micrometres or less produced by reduction of iron 
oxide with hydrogen; boron or boron carbide fuels of 85% purity or 
higher and average particle size of 60 micrometers or less;
    (3) Any of the foregoing metals or alloys of paragraphs (a) (1) and 
(2) of this section, whether or not encapsulated in aluminum, magnesium, 
zirconium or beryllium;
    (4) Perchlorates, chlorates and chromates composited with powered 
metal or other high energy fuel components;
    (5) Nitroganidine (NQ);
    (6) With the exception of chlorinetrifluoride, compounds composed of 
fluorine and one or more of the following: Other halogens, oxygen, 
nitrogen;
    (7) Carboranes; decaborane; pentaborane and derivatives;
    (8) Cyclotetramethylenetetranitramine (HMX); octahydro-1,3,5,7-
tetranitro-1,3,5,7-tetrazine; 1,3,5,7-tetranitro-1,3,5,7-tetraza-
cyclooctane; (octogen, octogene);
    (9) Hexanitrostilbene (HNS);
    (10) Diaminotrinitrobenzene (DATB);
    (11) Triaminotrinitrobenzene (TATB);
    (12) Triaminoguanidinenitrate (TAGN);
    (13) Titanium subhydride of stiochiometry TiH 0.65-168;
    (14) Dinitroglycoluril (DNGU, DNGU); tetranitroglycoluril (TNGU, 
SORGUYL);
    (15) Tetranitrobenzotriazolobenzotriazole (TACOT);
    (16) Diaminohexanitrobiphenyl (DIPAM);
    (17) Picrylaminodinitropyridine (PYX);
    (18) 3-nitro-1,2,4-triazol-5-one (NTO or ONTA);

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    (19) Hydrazine in concentrations of 70% or more; hydrazine nitrate; 
hydrazine perchlorates; unsymmetrical dimethyl hydrazine; monomethyl 
hydrazine; symmetrical dimethyl hydrazine;
    (20) Ammonium perchlorate;
    (21) 2-(5-cyanotetrozolato) penta amminecobalt (III) perchlorate 
(CP);
    (22) cis-bis (5-nitrotetrazolato) penta amminechobalt (III) 
perchlorate (or BNCP);
    (23) 7-amino 4,6-dinitrobenzofurazane-1-oxide (ADNBF); amino 
dinitrobenzofuroxan;
    (24) 5,7-diamino-4,6-dinitrobenzofurazane-1-oxide, (CL-14 or 
diaminodinitrobenzofurozan);
    (25) 2,4,6-trinitro-2,4,6-triaza-cyclo-hexanone (K-6 or keto-RDX);
    (26) 2,4,6,8-tetranitro-2,4,6,8-tetraaza-bicyclo (3,3,0)-octanone-
3(tetranitrosemiglycouril, K-55, or keto-bicyclic HMX);
    (27) 1,1,3-trinitroazetidine (TNAZ);
    (28) 1,4,5,8-tetranitro-1,4,5,8-tetraazadecalin (TNAD);
    (29) Hexanitrohexaazaisowurtzitane (CL-20 or NNIW; and chlathrates 
of CL-20);
    (30) Polynitrocubanes with more than four nitro groups;
    (31) Ammonium dinitramide (ADN or SR-12);
    (32) Cyclotrimethylentrinitramine (RDX); cyclonite; T4; hexahydro-
1,3,5-trinitro-1,3,5-triazine; 1,3,5-trinitro-1,3,5-triaza-cyclohexane; 
hexogen, hexogene;
    (33) Hydroxylammonium nitrate (HAN); hydroxylammonium perchlorate 
(HAP);
    (34) Hydroxy terminated Polybutadiene (HTPB) with a hydroxyl 
functionality of less than 2.28, a hydroxyl value of less than 0.77 meq/
g, and a viscosity at 30 degrees C of less than 47 poise;
    (b) ``Additives'' include the following:
    (1) Glycidylazide Polymer (GAP) and its derivatives;
    (2) Polycyanodifluoroamino-

ethyleneoxide (PCDE);
    (3) Butanetrioltrinitrate (BTTN);
    (4) Bis-2-Fluoro-2,2-dinitroethylformal (FEFO);
    (5) Butadienenitrileoxide (BNO);
    (6) Catocene, N-butyl-ferrocene and other ferrocene derivatives;
    (7) 3-nitraza-1,5 pentane diisocyanate;
    (8) Bis(2,2-dinitropropyl) formal and acetal;
    (9) Energetic monomers, plasticisers and polymers containing nitro, 
azido, nitrate, nitraza or difluroamino groups;
    (10) 1,2,3-Tris [1,2-bis(difluoroamino)ethoxy] propane; Tris vinoxy 
propane adduct, (TVOPA);
    (11) Bisazidomethyloxetane and its polymers;
    (12) Nitratomethylmethyloxetane or poly (3-nitratomethyl, 3-methyl 
oxetane); (Poly-NIMMO); (NMMO);
    (13) Azidomethylmethyloxetane (AMMO) and its polymers;
    (14) Tetraethylenepentamine-

acrylonitrile (TEPAN); cyanoethylated polyamine and its salts;
    (15) Polynitroorthocarbonates;
    (16) Tetraethylenepentamine-

acrylonitrileglycidol (TEPANOL); cyanoethylated polyamine adducted with 
glycidol and its salts;
    (17) Polyfunctional aziridine amides with isophthalic, trimesic BITA 
or butylene imine trimesamide isoyanuric, or trimethyladipic backbone 
structures and 2-methyl or 2-ethyl substitutions on the aziridine ring;
    (18) Basic copper salicylate; lead salicylate;
    (19) Lead beta resorcylate;
    (20) Lead stannate, lead maleate, lead citrate;
    (21) Tris-1-(2-methyl)aziridinyl phosphine oxide (MAPO), bis(2-
methyl aziridinyl) 2-(2-hydroxypropanoxy) propylamino phosphine oxide 
(BOBBA 8), and other MAPO derivatives;
    (22) Bis(2-methyl aziridinyl) methylamino phosphine oxide (methyl 
BAPO);
    (23) Organo-metallic coupling agents, specifically:
    (i) Neopentyl (diallyl) oxy, tri [dioctyl] phosphato titanate or 
titanium IV, 2,2[bis 2-propenolatomethyl, butanolato or tris [dioctyl] 
phosphato-O], or LICA 12;
    (ii) Titanium IV, [(2-propenolato-1)methyl, N-propanolatemethyl] 
butanolato-1 or tris(dioctyl)pyrophosphato, or KR3538;
    (iii) Titanium IV, [2-propenolato-1)methyl, N-propanolatomethyl] 
butanolato-1; or tris(dioctyl) phosphate;

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    (24) FPF-1 poly-2,2,3,3,4,4-hexafluoro pentane-1,5-diolformal;
    (25) FPF-3 poly-2,4,4,5,5,6,6-heptafluoro-2-trifluoromethyl-3-
oxaheptane-1,7-diolformal;
    (26) Polyglycidylnitrate (PGN) or poly(nitratomethyl oxirane); 
(poly-GLYN) (PGN);
    (27) Lead-copper chelates of beta-resorcylate and/or salicylates;
    (28) Triphenyl bismuth (TPB);
    (29) bis-2-hydroxyethylglycolamide (BHEGA);
    (30) Superfine iron oxide (Fe2 O3 hematite) 
with a specific surface area greater than 250 m2/g and an 
average particle size of 0.003 micrometres or less;
    (31) N-methyl-p-nitroaniline;
    (c) ``Precursors'' include the following:
    (1) 1,2,4-trihydroxybutane (1,2,4-butanetriol);
    (2) Guanidine nitrate;
    (3) 1,3,5-trichlorobenzene;
    (4) Bischloromethyloxetane (BCMO);
    (5) Low (less than 10,000) molecular weight, alcohol-functionalised, 
poly(ephichlorohydrin); poly(ephichlorhydrindiol); and triol;
    (6) Propyleneimide, 2-methylaziridine;
    (7) 1,3,5,7,-tetraacetyl-1,3,5,7-tetraaza-cyclooctane (TAT);
    (8) Dinitroazetidine-t-butyl salt;
    (9) Hexabenzylhexaazaisowurtzitane (HBIW);
    (10) Tetraacetyldibenzylhexa-

azaisowurtzitane (TAIW);
    (11) 1,4,5,8-tetraazadecaline.
    (d) Military high energy solid or liquid fuels specially formulated 
for military purposes: (1) Aircraft fuels controlled by Sec. 121.12(a) 
are finished products not their independent constituents. (2) military 
materials containing thickeners for hydrocarbon fuels specially 
formulated for use in flamethrowers or incendiary munitions; metal 
stearates or palmates (also known as octol); and M1, M2 and M3 
thickeners;
    (e) Any substance, or mixture meeting the following performance 
requirements:
    (1) Any explosive with a detonation velocity greater than 8,700 m/s 
or a detonation pressure greater than 340 kilobars;
    (2) Other organic high explosives yielding detonation pressures of 
250 kilobars or greater that will remain stable at temperatures of 523 K 
(250 degrees C) or higher for periods of 5 minutes or longer;
    (3) Any other UN Class 1.1 solid propellant with a theoretical 
specific impulse (under standard conditions) greater than 250 seconds 
for non-metallized, or greater than 270 seconds for aluminized 
compositions;
    (4) Any UN Class 1.3 solid propellant with a theoretical specific 
impulse greater than 230 seconds for non-halogenized, 250 seconds for 
non-metallized and 266 seconds for metallized compositions;
    (5) Any other explosive, propellant or pyrotechnic that can sustain 
a steady-state burning rate greater than 38mm (1.5 in) per second under 
standard conditions of 68.9 bar (1,000 PSI) pressure and 294K (21 
degrees C);
    (6) Any other gun propellants having a force constant greater than 
1,200 kJ/kg;
    (7) Elastomer modified cast double based propellants (EMCDB) with 
extensibility at maximum stress greater than 5% at 233 K (-40 degrees 
C).
    (f) Liquid oxidizers comprised of or containing the following:
    (1) Inhibited red fuming nitric acid (IRFNA));
    (2) Oxygen difluoride.

    Note: Category V includes the following substances when compounded 
or mixed with military explosives, fuels or propellants controlled under 
this category:

--Ammonium picrate
--Black powder
--Hexanitrodiphenylamine
--Difluoroamine (HNF2)
--Nitrostarch
--Potassium nitrate
--Tetranitronaphthalene
--Trinitroanisol
--Trinitronaphthalene
--Trinitroxylene
--Fuming nitric acid non-inhibited and non-enriched
--Acetylene
--Propane
--Liquid oxygen
--Hydrogen peroxide in concentrations less than 85%
--Misch metal
--N-pyrrolidinone and l-methyl-2-pyrrolidinone
--Dioctylmaleate

[[Page 348]]

--Ethylhexylacrylate
--Triethylaluminum (TEA), trimethylaluminum (TMA) and other pyrophoric 
metal alkyls and aryls of lithium, sodium, magnesium, zinc or boron
--Nitrocellulose
--Nitroglycerin (or glyceroltrinitrate, trinitroglycerine (NG)
--2,4,6 trinitrotoluene (TNT)
--Pentaerythritol tetranitrate (PETN)
--Trinitrophenylmethylnitramine (Tetryl)
--Ethylenediaminedinitrate (EDDN)
--Lead azide, normal and basic lead styphnate, and primary explosives or 
priming composition containing azides or azide complexes
--Triethyleneglycoldinitrate (TEGDN)
--2,4,6-trinitroresorcinol (styphnic acid)
--Diethyldiphenyl urea, dimethyldiphenyl urea and methylethyldiphenyl 
urea (Centralites)
--N,N-diphenylurea (unsymmetrical diphenylurea)
--Methyl-N,N-diphenylurea (methyl unsymmetrical diphenylurea)
--Ethyl-N,N-diphenylurea (ethyl unsymmetrical diphenylurea)
--2-nitrodiphenylamine (2-NDPA)
--4-nitrodiphenylamine (4-NDPA)
--2,2-dinitropropanol
--Chlorinetrifluoride.
[58 FR 60113, Nov. 15, 1993]



Sec. 121.13  Military fuel thickeners.

    Military fuel thickeners in Category V include compounds (e.g., 
octal) or mixtures of such compounds (e.g., napalm) specifically 
formulated for the purpose of producing materials which, when added to 
petroleum products, provide a gel-type incendiary material for use in 
bombs, projectiles, flame throwers, or other defense articles.



Sec. 121.14  [Reserved]



Sec. 121.15  Vessels of war and special naval equipment.

    Vessels of war means vessels, waterborne or submersible, designed, 
modified or equipped for military purposes, including vessels described 
as developmental, ``demilitarized'' or decommissioned. Vessels of war in 
Category VI, whether developmental, ``demilitarized'' and/or 
decommissioned or not, include, but are not limited to, the following:
    (a) Combatant vessels: (1) Warships (including nuclear-powered 
versions):
    (i) Aircraft carriers.
    (ii) Battleships.
    (iii) Cruisers.
    (iv) Destroyers.
    (v) Frigates.
    (vi) Submarines.
    (2) Other Combatants:
    (i) Patrol Combatants (e.g., including but not limited to PHM).
    (ii) Amphibious Aircraft/Landing Craft Carriers.
    (iii) Amphibious Materiel/Landing Craft Carriers.
    (iv) Amphibious Command Ships.
    (v) Mine Warfare Ships.
    (vi) Coast Guard Cutters (e.g., including but not limited to: WHEC, 
WMEC).
    (b) Combatant Craft: (1) Patrol Craft (patrol craft described in 
Sec. 121.1, Category VI, paragraph (b) are considered non-combatant):
    (i) Coastal Patrol Combatants.
    (ii) River, Roadstead Craft (including swimmer delivery craft).
    (iii) Coast Guard Patrol Craft (e.g., including but not limited to 
WPB).
    (2) Amphibious Warfare Craft:
    (i) Landing Craft (e.g., including but not limited to LCAC).
    (ii) Special Warfare Craft (e.g., including but not limited to: 
LSSC, MSSC, SDV, SWCL, SWCM).
    (3) Mine Warfare Craft and Mine Countermeasures Craft (e.g., 
including but not limited to: MCT, MSB).
    (c) Non-Combatant Auxiliary Vessels and Support Ships:
    (1) Combat Logistics Support:
    (i) Underway Replenishment Ships.
    (ii) Surface Vessel and Submarine Tender/Repair Ships.
    (2) Support Ships:
    (i) Submarine Rescue Ships.
    (ii) Other Auxiliaries (e.g., including but not limited to: AGDS, 
AGF, AGM, AGOR, AGOS, AH, AP, ARL, AVB, AVM, AVT).
    (d) Non-Combatant Support, Service and Miscellaneous Vessels (e.g., 
including but not limited to: DSRV, DSV, NR, YRR).
[58 FR 60115, Nov. 15, 1993]



Sec. 121.16  Missile Technology Control Regime Annex.

    Some of the items on the Missile Technology Control Regime Annex are 
controlled by both the Department of Commerce on the Commodity Control 
List and by the Department of State on the United States Munitions List. 
To the extent an article is on the United

[[Page 349]]

States Munitions List, a reference appears in parentheses listing the 
U.S. Munitions List category in which it appears. The following items 
constitute all items on the Missile Technology Control Regime Annex 
which are covered by the U.S. Munitions List:

                           Item 1--Category I

    Complete rocket systems (including ballistic missile systems, space 
launch vehicles, and sounding rockets (see Sec. 121.1, Cat. IV(a) and 
(b)) and unmanned air vehicle systems (including cruise missile systems 
see Sec. 121.1, Cat. VIII (a), target drones and reconnaisance drones 
(see Sec. 121.1, Cat. VIII (a)) capable of delivering at least a 500 kg 
payload to a range of at least 300 km.

                           Item 2--Cateogry I

    Complete subsystems usable in the systems in Item 1 as follows:
    (a) Individual rocket stages (see Sec. 121.1, Cat. IV(h));
    (b) Reentry vehicles (see Sec. 121.1, Cat. IV(g)), and equipment 
designed or modified therefor, as follows, except as provided in Note 
(1) below for those designed for non-weapon payloads;
    (1) Heat shields and components thereof fabricated of ceramic or 
ablative materials (see Sec. 121.1, Cat. IV(f));
    (2) Heat sinks and components thereof fabricated of light-weight, 
high heat capacity materials;
    (3) Electronic equipment specially designed for reentry vehicles 
(see Sec. 121.1, Cat. XI(a)(7));
    (c) Solid or liquid propellant rocket engines, having a total 
impulse capacity of 1.1 x 10 N-sec (2.5 x 10 lb-sec) or greater (see 
Sec. 121.1, Cat. IV, (h)).
    (d) ``Guidance sets'' capable of achieving system accuracy of 3.33 
percent or less of the range (e.g., a CEP of 1 j,. or less at a range of 
300 km), except as provided in Note (1) below for those designed for 
missiles with a range under 300 km or manned aircraft (see Sec. 121.1, 
Cat. XII(d));
    (e) Thrust vector control sub-systems, except as provided in Note 
(1) below for those designed for rocket systems that do not exceed the 
range/payload capability of Item 1 (see Sec. 121.1, Cat. IV);
    (f) Warhead safing, arming, fuzing, and firing mechanisms, except as 
provided in Note (1) below for those designed for systems other than 
those in Item 1 (see Sec. 121.1, Cat. IV(h)).

                             Notes to Item 2

    (1) The exceptions in (b), (d), (e), and (f) above may be treated as 
Category II if the subsystem is exported subject to end use statements 
and quantity limits appropriate for the excepted end use stated above.
    (2) CEP (circle of equal probability) is a measure of accuracy, and 
defined as the radius of the circle centered at the target, at a 
specific range, in which 50 percent of the payloads impact.
    (3) A ``guidance set'' integrates the process of measuring and 
computing a vehicle's position and velocity (i.e. navigation) with that 
of computing and sending commands to the vehicle's flight control 
systems to correct the trajectory.
    (4) Examples of methods of achieving thrust vector control which are 
covered by (e) include:
    (i) Flexible nozzle;
    (ii) Fluid or secondary gas injection;
    (iii) Movable engine or nozzle; Deflection of exhaust gas stream 
(jet vanes or probes); or
    (v) Use of thrust tabs.

                           Item 3--Category II

    Propulsion components and equipment usable in the systems in Item 1, 
as follows:
    (a) Lightweight turbojet and turbofan engines (including) 
turbocompound engines) that are small and fuel efficient (see 
Sec. 121.1, both Cat. IV(h) and VIII(b));
    (b) Ramjet/Scramjet/pulse jet/combined cycle engines, including 
devices to regulate combustion, and specially designed components 
therefor (see Sec. 121.1, both Cat. IV(h) and Cat. VIII(b));
    (c) Rocket motor cases, ``interior lining'', ``insulation'' and 
nozzles therefor (see Sec. 121.1, Cat. IV(h) and Cat. V(c));
    (d) Staging mechanisms, separation mechanisms, and interstages 
therefor (see Sec. 121.1, Cat. IV(c) and (h));
    (e) Liquid and slurry propellant (including oxidizers) control 
systems, and specially designed components therefor, designed or 
modified to operate in vibration environments of more than 100 g RMS 
between 20 Hz and,000 Hz (see Sec. 121.1, Cat. IV(c) and (h));
    (f) Hybrid rocket motors and specially designed components therefor 
(see Sec. 121.1, Cat. IV(h)).

                             Notes to Item 3

    (1) Item 3(a) engines may be exported as part of a manned aircraft 
or in quantities appropriate for replacement parts for manned aircraft.
    (2) In Item 3(C), ``interior lining'' suited for the bond interface 
between the solid propellant and the case or insulating liner is usually 
a liquid polymer based dispersion of refractory or insulating materials, 
e.g., carbon filled HTPB or other polymer with added curing agents to be 
sprayed or screeded over a case interior (see Sec. 121.1, Cat. V(c)).
    (3) In Item 3(c), ``insulation'' intended to be applied to the 
components of a rocket

[[Page 350]]

motor, i.e., the case, nozzle inlets, case closures, includes cured or 
semi-cured compounded rubber sheet stock containing an insulating or 
refractory material. It may also be incorporated as stress relief boots 
or flaps.
    (4) The only servo valves and pumps covered in (e) above, are the 
following:
    (i) Servo valves designed for flow rates of 24 liters per minute or 
greater, at an absolute pressure of 7,000 kPa (1,000 psi) or greater, 
that have an actuator response time of less than 100 msec;
    (ii) Pumps, for liquid propellants, with shaft speeds equal to or 
greater than 8,000 RPM or with discharge pressures equal to or greater 
than 7,000 kPa (1,000 psi).
    (5) Item 3(e) systems and components may be exports as part of a 
satellite.

                           Item 4--Category II

    Propellants and constituent chemicals for propellants as follows: 
(see Sec. 121.1, Cat. V(c) and Sec. 121.12 and Sec. 121.14).
    (a) Propulsive substances:
    (1) Hydrazine with a concentration of more than 70 percent and its 
derivatives including monomethylhydrazine (MMH) (see 
Sec. 121.12(a)(22));
    (2) Unsymmetric dimethylhydrazine (UDHM) (see Sec. 121.12(a)(22));
    (3) Ammonium perchlorate (see Sec. 121.12(a)(23));
    (4) Spherical aluminum powder with particle of uniform diameter of 
less than 500 x 10-m (500 micrometer) and an aluminum content of 97 
percent or greater (see Sec. 121.12(a)(1));
    (5) Metal fuels in particle sizes less than 500 x 10-m (500 
Microns), whether spherical, atomized, spheroidal, flaked or ground, 
consisting of 97 percent or more of any of the following: zirconium, 
beryllium, boron, magnesium, zinc, and alloys of these (see 
Sec. 121.12(a)(2));
    (6) Nitro-amines (cyclotetramethylene-tetranitramene (HMX) (see 
Sec. 121.12(a)(11)), cyclotrimethylene-trinitramine (RDX)) (see 
121.12(a)(35));
    (7) Perchlorates, chlorates or chromates mixed with powdered metals 
or other high energy fuel components (see Sec. 121.12(a)(4);
    (8) Carboranes, decaboranes, pentaboranes and derivatives thereof 
(see Sec. 121.12(a)(10);
    (9) Liquid oxidizers, as follows:
    (i) Nitrogen dioxide/dinitrogen tetroxide (see Sec. 121.14.(g));
    (ii) Inhibited Red Fuming Nitric Acid (IRFNA) (see 
Sec. 121.12(f)(1);
    (iii) Compounds composed of flourine and one or more of other 
halogens, oxygen or nitrogen (see Sec. 121.12(a)(9).
    (b) Polymeric substances:
    (2) Hydroxy-terminated polybutadiene (HTPB) (see Sec. 121.12(a)(38);
    (3) Glycidyl azide polymer (GAP) (see Sec. 121.12(b)(1)).
    (c) Other high energy density propellants such as, Boron Slurry, 
having an energy density of 40 x 10 joules/kg or greater (see 
Sec. 121.12(a)(3)).
    (d) Other propellant additives and agents:
    (1) Bonding agents as follows:
    (i) tris(1-(2-methyl)aziridinyl phosphine oxide (MAPO) (see 
Sec. 121.12(b)(17));
    (ii) trimesol-1(2-ethyl)aziridine (HX-868, BITA) (see 
Sec. 121.12(b)(13));
    (iii) ``Tepanol'' (HX-878), reaction product of 
tetraethylenepentamine, acrylonitrile and glycidol (see 
Sec. 121.12.(b)(11));
    (iv) ``Tepan'' (HX-879), Reaction product of tet enepentamine and 
acrylonitrile (see Sec. 121.12(b)(11));
    (v) Polyfunctional aziridene amides with isophthalic, trimesic, 
isocyanuric, or trimethyladipic backbone also having a 2-methyl or 2-
ethyl aziridine group (HX-752, HX-872 and HX-877). (see 
Sec. 121.12(b)(13)).
    (2) Curing agents and catalysts as follows:
    (i) Triphenyl bismuth (TPB) (see Sec. 121.12(b)(23));
    (3) Burning rate modifiers as follows:
    (i) Catocene (see Sec. 121.12(b)(5));
    (ii) N-butyl-ferrocene (see Sec. 121.12(b)(5));
    (iii) Other ferrocene derivatives (see Sec. 121.12(b)).
    (4) Nitrate esters and nitrato plasticizers as follows:
    (i) 1,2,4-butanetriol trinitrate (BTTN) (see Sec. 121.12(b)(3));
    (5) Stabilizers as follows:
    (i) N-methyl-p-nitroaniline (see Sec. 121.12(d)(1)).

                           Item 8--Category II

    Structural materials usable in the systems in Item 1, as follows:
    (a) Composite structures, laminates, and manufactures thereof, 
including resin impregnated fibre prepregs and metal coated fibre 
preforms therefor, specially designed for use in the systems in Item 1 
and the subsystems in Item 2 made either with organix matrix or metal 
matrix utilizing fibrous or filamentary reinforcements having a specific 
tensile strength greater than 7.62 x 10\4\ m (3 x 10\6\ inches) and a 
specific modules greater than 3.18 x 10\6\ m (1.25 x 10\8\ inches), (see 
Sec. 121.1, Category IV (f), and Category XIII (d));
    (b) Resaturated pyrolized (i.e. carbon-carbon) materials designed 
for rocket systems, (see Sec. 121.1 Category IV (f));
    (c) Fine grain recrystallized bulk graphites (with a bulk density of 
at least 1.72 g/cc measured at 15 degrees C), pyrolytic, or fibrous 
reinforced graphites useable for rocket nozzles and reentry vehicle nose 
tips (see Sec. 121.1, Category IV (f) and Category XIII;
    (d) Ceramic composites materials (dielectric constant less than 6 at 
frequencies from 100 Hz to 10,000 MHz) for use in missile

[[Page 351]]

radomes, and bulk machinable silicon-carbide reinforced unfired ceramic 
useable for nose tips (see Sec. 121.1, Category IV (f));

                           Item 9--Category II

    Instrumentation, navigation and direction finding equipment and 
systems, and associated production and test equipment as follows; and 
specially designed components and software therefor:
    (a) Integrated flight instrument systems, which include 
gyrostabilizers or automatic pilots and integration software therefor; 
designed or modified for use in the systems in Item 1 (See Sec. 121.1, 
Category XII(d));
    (b) Gyro-astro compasses and other devices which derive position or 
orientation by means of automatically tracking celestrial bodies or 
satellites (see Sec. 121.1, Category XV(d));
    (c) Accelerometers with a threshold of 0.05 g or less, or a 
linearity error within 0.25 percent of full scale output, or both, which 
are designed for use in inertial navigation systems or in guidance 
systems of all types (see Sec. 121.1, Category VIII(e) and Category XII 
(d));
    (d) All types of gyros usable in the systems in Item 1, with a rated 
drift rate stability of less than 0.5 degree (1 sigma or rms) per hour 
in a 1 q environment (see Sec. 121.1, Category VIII(e) and Category 
XII(d));
    (e) Continuous output accelerometers or gyros of any type, specified 
to function at acceleration levels greater than 100 g (see Sec. 121.1, 
Category XII(d));
    (f) Inertial or other equipment using accelerometers described by 
subitems (c) and (e) above, and systems incorporating such equipment, 
and specially designed integration software therefor (see Sec. 121.1, 
Category VIII (e) and Category XII(d));

                             Notes to Item 9

    (1) Items (a) through (f) may be exported as part of a manned 
aircraft or satellite or in quantities appropriate for replacement parts 
for manned aircraft.
    (2) In subitem (d):
    (i) Drift rate is defined as the time rate of output deviation from 
the desired output. It consists of random and systematic components and 
is expressed as an equivalent angular displacement per unit time with 
respect to inertial space.
    (ii) Stability is defined as standard deviation (1 sigma) of the 
variation of a particular parameter from its calibrated value measured 
under stable temperature conditions. This can be expressed as a function 
of time.

                          Item 10--Category II

    Flight control systems and ``technology'' as follows; designed or 
modified for the systems in Item 1.
    (a) Hydraulic, mechanical, electro-optical, or electro-mechanical 
flight control systems (including fly-by-wire systems), (see Sec. 121.1, 
Category IV (h));
    (b) Attitude control equipment, (see Sec. 121.1, Category IV, (c) 
and (h));
    (c) Design technology for integration of air vehicle fuselage, 
propulsion system and lifting control surfaces to optimize aerodynamic 
performance throughout the flight regime of an unmanned air vehicle, 
(see Sec. 121.1, Category VIII (k));
    (d) Design technology for integration of the flight control, 
guidance, and propulsion data into a flight management system for 
optimization of rocket system trajectory, (see Sec. 121.1, Category IV 
(i)).

                             Note to Item 10

    Items (a) and (b) may be exported as part of a manned aircraft or 
satellite or in quantities appropriate for replacement parts for manned 
aircraft.

                          Item 11--Category II

    Avionics equipment, ``technology'' and components as follows; 
designed or modified for use in the systems in Item 1, and specially 
designed software therefor:
    (a) Radar and laser radar systems, including altimeters (see 
Sec. 121.1, Category XI(a)(3));
    (b) Passive sensors for determining bearings to specific 
electromagnetic sources (direction finding equipment) or terrain 
characteristics (see Sec. 121.1, Category XI(b) and (d));
    (c) Global Positioning System (GPS) or similar satellite receivers;
    (1) Capable of providing navigation information under the following 
operational conditions:
    (i) At speeds in excess of 515 m/sec (1,000 nautical miles/hours); 
and
    (ii) At altitudes in excess of 18 km (60,000 feet), (see Sec. 121.1, 
Category XV(d)(2); or
    (2) Designed or modified for use with unmanned air vehicles covered 
by Item 1 (see Sec. 121.1, Category XV(d)(4)).
    (d) Electronic assemblies and components specifically designed for 
military use and operation at temperatures in excess of 125 degrees C, 
(see Sec. 121.1, Category XI(a)(7)).
    (e) Design technology for protection of avionics and electrical 
subsystems against electromagnetic pulse (EMP) and electromagnetic 
interference (EMI) hazards from external sources, as follows, (see 
Sec. 121.1, Category XI (b)).
    (1) Design technology for shielding systems;
    (2) Design technology for the configuration of hardened electrical 
circuits and subsystems;
    (3) Determination of hardening criteria for the above.

[[Page 352]]

                            Notes to Item 11

    (1) Item 11 equipment may be exported as part of a manned aircraft 
or satellite or in quantities appropriate for replacement parts for 
manned aircraft.
    (2) Examples of equipment included in this Item:
    (i) Terrain contour mapping equipment;
    (ii) Scene mapping and correlation (both digital and analog) 
equipment;
    (iii) Doppler navigation radar equipment;
    (iv) Passive interferometer equipment;
    (v) Imaging sensor equipment (both active and passive);
    (3) In subitem (a), laser radar systems embody specialized 
transmission, scanning, receiving and signal processing techniques for 
utilization of lasers for echo ranging, direction finding and 
discrimination of targets by location, radial speed and body reflection 
characteristics.

                          Item 12--Category II

    Launch support equipment, facilities and software for the systems in 
Item 1, as follows:
    (a) Apparatus and devices designed or modified for the handling, 
control, activation and launching of the systems in Item 1, (see 
Sec. 121.1, Category IV(c));
    (b) Vehicles designed or modified for the transport, handling, 
control, activation and launching of the systems in Item 1, (see 
Sec. 121.1, Category VII(d));
    (c) Telemetering and telecontrol equipment usable for unmanned air 
vehicles or rocket systems, (see Sec. 121.1, Category XI(a));
    (d) Precision tracking systems:
    (1) Tracking systems which use a translb nv installed on the rocket 
system or unmanned air vehicle in conjunction with either surface or 
airborne references or navigation satellite systems to provide real-time 
measurements of in-flight position and velocity, (see Sec. 121.1, 
Category XI(a));
    (2) Range instrumention radars including associated optical/infrared 
trackers and the specially designed software therefor with all of the 
following capabilities (see Sec. 121.1, Category XI(a)(3)):
    (i) angular resolution better than 3 milli-radians (0.5 mils);
    (ii) range of 30 km or greater with a range resolution better than 
10 meters RMS;
    (iii) velocity resolution better than 3 meters per second.
    (3) Software which processes post-flight, recorded data, enabling 
determination of vehicle position throughout its flight path (see 
Sec. 121.1, Category IV(i)).

                          Item 13--Category II

    Analog computers, digital computers, or digital differential 
analyzers designed or modified for use in the systems in Item 1 (see 
Sec. 121.1, Category XI (a)(6), having either of the following 
characteristics:
    (a) Rated for continuous operation at temperature from below minus 
45 degrees C to above plus 55 degrees C; or
    (b) Designed as ruggedized or ``radiation hardened''.

                             Note to Item 13

    Item 13 equipment may be exported as part of a manned aircraft or 
satellite or in quantities appropriate for replacement parts for manned 
aircraft.

                          Item 14--Category II

    Analog-to-digital converters, usable in the system in Item 1, having 
either of the following characteristics:
    (a) Designed to meet military specifications for ruggedized 
equipment (see Sec. 121.1, Category XI(d)); or,
    (b) Designed or modified for military use (see Sec. 121.1, Category 
XI(d)); and being one of the following types:
    (1) Analog-to-digital converter ``microcircuits,'' which are 
``radiation hardened'' or have all of the following characteristics:
    (i) Having a resolution of 8 bits or more;
    (ii) Rated for operation in the temperature range from below minus 
54 degrees C to above plus 125 degrees C; and
    (iii) Hermetically sealed.
    (2) Electrical input type analog-to-digital converter printed 
circuit boards or modules, with all of the following characteristics:
    (i) Having a resolution of 8 bits or more;
    (ii) Rated for operation in the temperature range from below minus 
45 degrees C to above plus 55 degrees C; and
    (iii) Incorporated ``microcircuits'' listed in (1), above.

                          Item 16--Category II

    Specially designed software, or specially designed software with 
related specially designed hybrid (combined analog/digital) computers, 
for modeling, simulation, or design integration of the systems in Item 1 
and Item 2 (see Sec. 121.1, Category IV(i) and Category XI(a)(6)).

                             Note to Item 16

    The modelling includes in particular the aerodynamic and 
thermodynamic analysis of the system.

                          Item 17--Category II

    Materials, devices, and specially designed software for reduced 
observables such as radar reflectivity, ultraviolet/infrared signatures 
on acoustic signatures (i.e. stealth technology), for applications 
usable for the systems in Item 1 or Item 2 (see Sec. 121.1, Category 
XIII (e) and (k)), for example:

[[Page 353]]

    (a) Structural material and coatings specially designed for reduced 
radar reflectivity;
    (b) Coatings, including paints, specially designed for reduced or 
tailored reflectivity or emissivity in the microwave, infrared or 
ultraviolet spectra, except when specially used for thermal control of 
satellites.
    (c) Specially designed software or databases for analysis of 
signature reduction.
    (d) Specially designed radar cross section measurement systems (see 
Sec. 121.1, Category XI(a)(3)).

                          Item 18--Category II

    Devices for use in protecting rocket systems and unmanned air 
vehicles against nuclear effects (e.g. Electromagnetic Pulse (EMP), X-
rays, combined blast and thermal effects), and usable for the systems in 
Item 1, as follows (see Sec. 121.1, Category IV (c) and (h)):
    (a) ``Radiation Hardened'' ``microcircuits'' and detectors (see 
Sec. 121.1, Category XI(c)(3) Note: This commodity has been formally 
proposed for movement to category XV(e)(2) in the near future).
    (b) Radomes designed to withstand a combined thermal shock greater 
than 1000 cal/sq cm accompanied by a peak over pressure of greater than 
50 kPa (7 pounds per square inch) (see Sec. 121.1, Category IV(h)).

                           Note to Item 18(a)

    A detector is defined as a mechanical, electrical, optical or 
chemical device that automatically identifies and records, or registers 
a stimulus such as an environmental change in pressure or temperature, 
an electrical or electromagnetic signal or radiation from a radioactive 
material. The following pages were removed from the final itar for 
replacement by DTC's updated version section 6(l) of the Export 
Administration Act of 1979 (50 U.S.C. App. 2405(l)), as amended. In 
accordance with this provision, the list of MTCR Annex items shall 
constitute all items on the U.S. Munitions List in Sec. 121.16.



PART 122--REGISTRATION OF MANUFACTURERS AND EXPORTERS--Table of Contents




Sec.
122.1  Registration requirements.
122.2  Submission of registration statement.
122.3  Registration fees.
122.4  Notification of changes in information furnished by registrants.
122.5  Maintenance of records by registrants.

    Authority:  Secs. 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 U.S.C. 
2752, 2778); E.O. 11958, 42 FR 4311, 1977 Comp. p. 79; 22 U.S.C. 2658.

    Source:  58 FR 39298, July 22, 1993, unless otherwise noted.



Sec. 122.1  Registration requirements.

    (a) Any person who engages in the United States in the business of 
either manufacturing or exporting defense articles or furnishing defense 
services is required to register with the Office of Defense Trade 
Controls. Manufacturers who do not engage in exporting must nevertheless 
register.
    (b) Exemptions. Registration is not required for:
    (1) Officers and employees of the United States Government acting in 
an official capacity.
    (2) Persons whose pertinent business activity is confined to the 
production of unclassified technical data only.
    (3) Persons all of whose manufacturing and export activities are 
licensed under the Atomic Energy Act of 1954, as amended.
    (4) Persons who engage only in the fabrication of articles for 
experimental or scientific purpose, including research and development.
    (c) Purpose. Registration is primarily a means to provide the U.S. 
Government with necessary information on who is involved in certain 
manufacturing and exporting activities. Registration does not confer any 
export rights or privileges. It is generally a precondition to the 
issuance of any license or other approval under this subchapter.



Sec. 122.2  Submission of registration statement.

    (a) General. The Department of State Form DSP-9 (Registration 
Statement) and the transmittal letter required by paragraph (b) of this 
section must be submitted by an intended registrant with a payment by 
check or money order payable to the Department of State of one of the 
fees prescribed in Sec. 122.3(a) of this subchapter. The Registration 
Statement and transmittal letter must be signed by a senior officer who 
has been empowered by the intended registrant to sign such documents. 
The intended registrant shall also submit documentation that 
demonstrates that it is incorporated or otherwise authorized to do 
business in the United States. The Office of Defense Trade Controls will 
return to the sender any Registration Statement

[[Page 354]]

that is incomplete, or that is not accompanied by the required letter or 
payment of the proper registration fee.
    (b) Transmittal letter. A letter of transmittal, signed by an 
authorized senior officer of the intended registrant, shall accompany 
each Registration Statement.
    (1) The letter shall state whether the intended registrant, chief 
executive officer, president, vice-presidents, other senior officers or 
officials (e.g. comptroller, treasurer, general counsel) or any member 
of the board of directors:
    (i) Has ever been indicted for or convicted of violating any of the 
U.S. criminal statutes enumerated in Sec. 120.27 of this subchapter; or
    (ii) Is ineligible to contract with, or to receive a license or 
other approval to import defense articles or defense services from, or 
to receive an export license or other approval from, any agency of the 
U.S. Government.
    (2) The letter shall also declare whether the intended registrant is 
owned or controlled by foreign persons (as defined in Sec. 120.16 of 
this subchapter). If the intended registrant is owned or controlled by 
foreign persons, the letter shall also state whether the intended 
registrant is incorporated or otherwise authorized to engage in business 
in the United States.
    (c) Definition. For purposes of this section, ownership means that 
more than 50 percent of the outstanding voting securities of the firm 
are owned by one or more foreign persons. Control means that one or more 
foreign persons have the authority or ability to establish or direct the 
general policies or day-to-day operations of the firm. Control is 
presumed to exist where foreign persons own 25 percent or more of the 
outstanding voting securities if no U.S. persons control an equal or 
larger percentage. The standards for control specified in 22 CFR 60.2(c) 
also provide guidance in determining whether control in fact exists.



Sec. 122.3  Registration fees.

    (a) A person who is required to register may do so for a period up 
to 4 years upon submission of a completed form DSP-9, transmittal 
letter, and payment of a fee as follows:

1 year--$600
2 years--$1,200
3 years--$1,800
4 years--$2,200

    (b) Lapse in registration. A registrant who fails to renew a 
registration and, after an intervening period, seeks to register again 
must pay registration fees for any part of such intervening period 
during which the registrant engaged in the business of manufacturing or 
exporting defense articles or defense services.
    (c) Refund of fee. Fees paid in advance for future years of a 
multiple year registration will be refunded upon request if the 
registrant ceases to engage in the manufacture or export of defense 
articles and defense services. A request for a refund must be submitted 
to the Office of Defense Trade Controls prior to the beginning of any 
year for which a refund is claimed.
[58 FR 39298, July 22, 1993, as amended at 62 FR 27497, May 20, 1997]



Sec. 122.4  Notification of changes in information furnished by registrants.

    (a) A registrant must, within five days of the event, notify the 
Office of Defense Trade Controls by registered mail if:
    (1) Any of the persons referred to in Sec. 122.2(b) are indicted for 
or convicted of violating any of the U.S. criminal statutes enumerated 
in Sec. 120.27 of this subchapter, or become ineligible to contract 
with, or to receive a license or other approval to export or temporarily 
import defense articles or defense services from any agency of the U.S. 
government; or
    (2) There is a material change in the information contained in the 
Registration Statement, including a change in the senior officers; the 
establishment, acquisition or divestment of a subsidiary or foreign 
affiliate; a merger; a change of location; or the dealing in an 
additional category of defense articles or defense services.
    (b) A registrant must notify the Office of Defense Trade Controls by 
registered mail at least 60 days in advance of any intended sale or 
transfer to a foreign person of ownership or control of the registrant 
or any entity thereof.

[[Page 355]]

Such notice does not relieve the registrant from obtaining the approval 
required under this subchapter for the export of defense articles or 
defense services to a foreign person, including the approval required 
prior to disclosing technical data. Such notice provides the Office of 
Defense Trade Controls with the information necessary to determine 
whether the authority of section 38(g)(6) of the Arms Export Control Act 
regarding licenses or other approvals for certain sales or transfers of 
articles or data should be invoked (see Secs. 120.10 and 126.1(e) of 
this subchapter).
    (c) The new entity formed when a registrant merges with another 
company or acquires, or is acquired by, another company or a subsidiary 
or division of another company shall advise the Office of Defense Trade 
Controls of the following:
    (1) The new firm name and all previous firm names being disclosed;
    (2) The registration number that will survive and those that are to 
be discontinued (if any);
    (3) The license numbers of all approvals on which unshipped balances 
will be shipped under the surviving registration number, since any 
license not the subject of notification will be considered invalid; and
    (4) Amendments to agreements approved by the Office of Defense Trade 
Controls to change the name of a party to those agreements. The 
registrant must, within 60 days of this notification, provide to the 
Office of Defense Trade Controls a signed copy of an amendment to each 
agreement signed by the new U.S. entity, the former U.S. licensor and 
the foreign licensee. Any agreements not so amended will be considered 
invalid.
    (d) Prior approval by the Office of Defense Trade Controls is 
required for any amendment making a substantive change.



Sec. 122.5  Maintenance of records by registrants.

    (a) A person who is required to register must maintain records 
concerning the manufacture, acquisition and disposition of defense 
articles; the provision of defense services; and information on 
political contributions, fees, or commissions furnished or obtained, as 
required by part 130 of this subchapter. All such records must be 
maintained for a period of five years from the expiration of the license 
or other approval. The Director, Office of Defense Trade Controls, may 
prescribe a longer or shorter period in individual cases.
    (b) Records maintained under this section shall be available at all 
times for inspection and copying by the Director, Office of Defense 
Trade Controls or a person designated by the Director (the Director of 
the Diplomatic Security Service or a person designated by the Director 
of the Diplomatic Security Service or another designee), or the 
Commissioner of the U.S. Customs Service or a person designated by the 
Commissioner.



PART 123--LICENSES FOR THE EXPORT OF DEFENSE ARTICLES--Table of Contents




Sec.
123.1   Requirement for export or temporary import licenses.
123.2   Import jurisdiction.
123.3   Temporary import licenses.
123.4   Temporary import license exemptions.
123.5   Temporary export licenses.
123.6   Foreign trade zones and U.S. Customs bonded warehouses.
123.7   Exports to warehouses or distribution points outside the United 
          States.
123.8  Special controls on vessels, aircraft and satellites covered by 
          the U.S. Munitions List.
123.9  Country of ultimate destination and approval of reexports or 
          retransfers.
123.10  Non-transfer and use assurances.
123.11  Movements of vessels and aircraft covered by the U.S. Munitions 
          List outside the United States.
123.12  Shipments between U.S. possessions.
123.13  Domestic aircraft shipments via a foreign country.
123.14  Import certificate/delivery verification procedure.
123.15  Congressional notification for licenses.
123.16  Exemptions of general applicability.
123.17  Exports of firearms and ammunition.
123.18  Firearms for personal use of members of the U.S. Armed Forces 
          and civilian employees of the U.S. Government.
123.19  Canadian and Mexican border shipments.
123.20  Nuclear materials.
123.21  Duration, renewal and disposition of licenses.

[[Page 356]]

123.22  Filing of export licenses and Shipper's Export Declarations with 
          District Directors of Customs.
123.23  Monetary value of shipments.
123.24  Shipments by mail.
123.25  Amendments to licenses.
123.26  Recordkeeping requirement for exemptions.
123.27  Temporary export for personal use of Category XIII(b)(1) 
          cryptographic products.

    Authority:  Secs. 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 U.S.C. 
2752, 2778); 22 U.S.C. 2753; E.O. 11958, 42 FR 4311; 3 CFR 1977 Comp. 
79; 22 U.S.C. 2658.

    Source:  58 FR 39299, July 22, 1993, unless otherwise noted.



Sec. 123.1  Requirement for export or temporary import licenses.

    (a) Any person who intends to export or to import temporarily a 
defense article must obtain the approval of the Office of Defense Trade 
Controls prior to the export or temporary import, unless the export or 
temporary import qualifies for an exemption under the provisions of this 
subchapter. Applications for export or temporary import must be made as 
follows:
    (1) Applications for licenses for permanent export must be made on 
Form DSP-5 (unclassified);
    (2) Applications for licenses for temporary export must be made on 
Form DSP-73 (unclassified);
    (3) Applications for licenses for temporary import must be made on 
Form DSP-61 (unclassified); and
    (4) Applications for the export or temporary import of classified 
defense articles or classified technical data must be made on Form DSP-
85.
    (b) Applications for Department of State export licenses must be 
confined to proposed exports of defense articles including technical 
data.
    (c) As a condition to the issuance of a license or other approval, 
the Office of Defense Trade Controls may require all pertinent 
documentary information regarding the proposed transaction and proper 
completion of the application form as follows:
    (1) Form DSP-5, DSP-61, DSP-73, and DSP-85 applications must have an 
entry in each block where space is provided for an entry. All requested 
information must be provided.
    (2) Attachments and supporting technical data or brochures should be 
submitted in seven collated copies. Two copies of any freight forwarder 
lists must be submitted. If the request is limited to renewal of a 
previous license or for the export of spare parts, only two sets of any 
attachment (including freight forwarder lists) and one copy of the 
previous license should be submitted.
    (3) A certification letter signed by an empowered official must 
accompany all application submissions (see Sec. 126.13 of this 
subchapter).
    (4) An application for a license under this part for the permanent 
export of defense articles sold commercially must be accompanied by a 
copy of a purchase order, letter of intent or other appropriate 
documentation. In cases involving the U.S. Foreign Military Sales 
program, three copies of the relevant Department of Defense Form 1513 
are required, unless the procedures of Sec. 126.4(c) or Sec. 126.6 of 
this subchapter are followed.
    (5) Form DSP-83, duly executed, must accompany all license 
applications for the permanent export of significant military equipment, 
including classified hardware or classified technical data (see 
Secs. 123.10 and 125.3 of this subchapter).
    (6) A statement concerning the payment of political contributions, 
fees and commissions must accompany a permanent export application if 
the export involves defense articles or defense services valued in an 
amount of $500,000 or more and is being sold commercially to or for the 
use of the armed forces of a foreign country or international 
organization (see part 130 of this subchapter).
    (d) Provisions for furnishing the type of defense services described 
in Sec. 120.9(a) of this subchapter are contained in part 124 of this 
subchapter. Provisions for the export or temporary import of technical 
data and classified defense articles are contained in part 125 of this 
subchapter.
    (e) A request for a license for the export of unclassified technical 
data (DSP-5) related to a classified defense article should specify any 
classified

[[Page 357]]

technical data or material that subsequently will be required for export 
in the event of a sale.



Sec. 123.2  Import jurisdiction.

    The Department of State regulates the temporary import of defense 
articles. Permanent imports of defense articles into the United States 
are regulated by the Department of the Treasury (see 27 CFR parts 47, 
178 and 179).



Sec. 123.3  Temporary import licenses.

    (a) A license (DSP-61) issued by the Office of Defense Trade 
Controls is required for the temporary import and subsequent export of 
unclassified defense articles, unless exempted from this requirement 
pursuant to Sec. 123.4. This requirement applies to:
    (1) Temporary imports of unclassified defense articles that are to 
be returned directly to the country from which they were shipped to the 
United States;
    (2) Temporary imports of unclassified defense articles in transit to 
a third country;
    (b) A bond may be required as appropriate (see part 125 of this 
subchapter for license requirements for technical data and classified 
defense articles.)



Sec. 123.4  Temporary import license exemptions.

    (a) District Directors of Customs shall permit the temporary import 
(and subsequent export) without a license, for a period of up to 4 
years, of unclassified U.S.-origin defense articles (including any 
article manufactured abroad pursuant to U.S. Government approval) if the 
article temporarily imported:
    (1) Is serviced (e.g., inspection, testing, calibration or repair, 
including overhaul, reconditioning and one-to-one replacement of any 
defective articles, parts or components, but excluding any modification, 
enhancement, upgrade or other form of alteration or improvement that 
changes the basic performance of the article), and is subsequently 
returned to the country from which it was imported. Shipment may be made 
by the U.S. importer or a foreign government representative of the 
country from which the goods were imported; or
    (2) Is to be enhanced, upgraded or incorporated into another article 
which has already been authorized by the Office of Defense Trade 
Controls for permanent export; or
    (3) Is imported for the purpose of exhibition, demonstration or 
marketing in the United States and is subsequently returned to the 
country from which it was imported; or
    (4) Has been rejected for permanent import by the Department of the 
Treasury and is being returned to the country from which it was shipped; 
or
    (5) Is approved for such import under the U.S. Foreign Military 
Sales (FMS) program pursuant to an executed U.S. Department of Defense 
Letter of Offer and Acceptance (DD Form 1513).

    Note: These Exceptions do not apply to shipments that transit the 
U.S. to or from Canada (see Sec. 123.19 and Sec. 126.5 of this 
subchapter for exceptions).

    (b) District Directors of Customs shall permit the temporary import 
(but not the subsequent export) without a license of unclassified 
defense articles that are to be incorporated into another article, or 
modified, enhanced, upgraded, altered, improved or serviced in any other 
manner that changes the basic performance or productivity of the article 
prior to being returned to the country from which they were shipped or 
prior to being shipped to a third country. A DSP-5 is required for the 
reexport of such unclassified defense articles after incorporation into 
another article, modification, enhancement, upgrading, alteration or 
improvement.
    (c) Requirements. To use an exemption under Sec. 123.4 (a) or (b), 
the following criteria must be met:
    (1) The importer must meet the eligibility requirements set forth in 
Sec. 120.1(b) of this subchapter;
    (2) At the time of export, the ultimate consignee named on the 
Shipper's Export Declaration (SED) must be the same as the foreign 
consignee or end-user of record named at the time of import; and
    (3) As stated in Sec. 126.1 of this subchapter, the temporary import 
must not be from or on behalf of a proscribed country listed in that 
section unless an exception has been granted in accordance with 
Sec. 126.3 of this subchapter.

[[Page 358]]

    (d) Procedures. To the satisfaction of the District Director of 
Customs, the importer and exporter must comply with the following 
procedures:
    (1) At the time of temporary import--
    (i) File and annotate the applicable U.S. Customs document (e.g., 
Form CF 3461, 7512, 7501, 7523 or 3311) to read: ``This shipment is 
being imported in accordance with and under the authority of 22 CFR 
123.4(a) (identify subsection),'' and
    (ii) Include, on the invoice or other appropriate documentation, a 
complete list and description of the defense article(s) being imported, 
including quantity and U.S. dollar value; and
    (2) At the time of export, file with the District Director of 
Customs at the port of exit a Shipper's Export Declaration (Department 
of Commerce Form 7525-V) and include on the SED or as an attachment the 
following information:
    (i) the U.S. Customs entry document number or a copy of the U.S. 
Customs documentation under which the article was imported;
    (ii) the following statement: ``22 CFR (identify section) and 22 CFR 
120.1(b) applicable.''



Sec. 123.5  Temporary export licenses.

    (a) The Office of Defense Trade Controls may issue a license for the 
temporary export of unclassified defense articles (DSP-73). Such 
licenses are valid only if (1) the article will be exported for a period 
of less than 4 years and will be returned to the United States and (2) 
transfer of title will not occur during the period of temporary export. 
Accordingly, articles exported pursuant to a temporary export license 
may not be sold or otherwise permanently transferred to a foreign person 
while they are overseas under a temporary export license. A renewal of 
the license or other written approval must be obtained from the Office 
of Defense Trade Controls if the article is to remain outside the United 
States beyond the period for which the license is valid.
    (b) Requirements. Defense articles authorized for temporary export 
under this section may be shipped only from a port in the United States 
where a District Director of Customs is available, or from a U.S. Post 
Office (see 39 CFR part 20), as appropriate. The license for temporary 
export must be presented to the District Director of Customs who, upon 
verification, will endorse the exit column on the reverse side of the 
license. In some instances of the temporary export of technical data 
(e.g postal shipments), self-endorsement will be necessary (see 
Sec. 123.22(d)). The endorsed license for temporary export is to be 
retained by the licensee. In the case of a military aircraft or vessel 
exported under its own power, the endorsed license must be carried on 
board such vessel or aircraft as evidence that it has been duly 
authorized by the Department of State to leave the United States 
temporarily.
    (c) Upon the return to the United States of defense articles covered 
by a license for temporary export, the license will be endorsed in the 
entry column by the District Director of Customs. This procedure shall 
be followed for all exits and entries made during the period for which 
the license is valid. The licensee must send the license to the Office 
of Defense Trade Controls immediately upon expiration or after the final 
return of the defense articles approved for export, whichever occurs 
first.



Sec. 123.6  Foreign trade zones and U.S. Customs bonded warehouses.

    Foreign trade zones and U.S. Customs bonded warehouses are 
considered integral parts of the United States for the purpose of this 
subchapter. An export license is therefore not required for shipment 
between the United States and a foreign trade zone or a Customs bonded 
warehouse. In the case of classified defense articles, the provisions of 
the Department of Defense Industrial Security Manual will apply. An 
export license is required for all shipments of articles on the U.S. 
Munitions List from foreign trade zones and U.S. Customs bonded 
warehouses to foreign countries, regardless of how the articles reached 
the zone or warehouse.

[[Page 359]]



Sec. 123.7  Exports to warehouses or distribution points outside the United States.

    Unless the exemption under Sec. 123.16(b)(1) is used, a license is 
required to export defense articles to a warehouse or distribution point 
outside the United States for subsequent resale and will normally be 
granted only if an agreement has been approved pursuant to Sec. 124.14 
of this subchapter.



Sec. 123.8  Special controls on vessels, aircraft and satellites covered by the U.S. Munitions List.

    (a) Transferring registration or control to a foreign person of any 
aircraft, vessel, or satellite on the U.S. Munitions List is an export 
for purposes of this subchapter and requires a license or written 
approval from the Office of Defense Trade Controls. This requirement 
applies whether the aircraft, vessel, or satellite is physically located 
in the United States or abroad.
    (b) The registration in a foreign country of any aircraft, vessel or 
satellite covered by the U.S. Munitions List which is not registered in 
the United States but which is located in the United States constitutes 
an export. A license or written approval from the Office of Defense 
Trade Controls is therefore required. Such transactions may also require 
the prior approval of the Maritime Administration, the Federal Aviation 
Administration or other agencies of the U.S. Government.



Sec. 123.9  Country of ultimate destination and approval of reexports or retransfers.

    (a) The country designated as the country of ultimate destination on 
an application for an export license, or on a Shipper's Export 
Declaration where an exemption is claimed under this subchapter, must be 
the country of ultimate end-use. The written approval of the Office of 
Defense Trade Controls must be obtained before reselling, transferring, 
transshipping, or disposing of a defense article to any end user, end 
use or destination other than as stated on the export license, or on the 
Shipper's Export Declaration in cases where an exemption is claimed 
under this subchapter. Exporters must ascertain the specific end-user 
and end-use prior to submitting an application to the Office of Defense 
Trade Controls or claiming an exemption under this subchapter.
    (b) The exporter shall incorporate the following statement as an 
integral part of the bill of lading, and the invoice whenever defense 
articles on the U.S. Munitions List are to be exported:

    These commodities are authorized by the U.S. Government for export 
only to [country of ultimate destination] for use by [end-user]. They 
may not be transferred, transshipped on a non-continuous voyage, or 
otherwise be disposed of in any other country, either in their original 
form or after being incorporated into other end-items, without the prior 
written approval of the U.S. Department of State.''

    (c) A U.S. person or a foreign person requesting approval for the 
reexport or retransfer, or change in end-use, of a defense article shall 
submit a written request which shall be subject to all the documentation 
required for a permanent export license (see Sec. 123.1) and shall 
contain the following:
    (1) The license number under which the defense article was 
previously authorized for export from the United States;
    (2) A precise description, quantity and value of the defense 
article;
    (3) A description of the new end-use; and
    (4) Identification of the new end-user.
    (d) The written approval of the Office of Defense Trade Controls 
must be obtained before reselling, transferring, transshipping on a non-
continuous voyage, or disposing of a defense article in any country 
other than the country of ultimate destination, or anyone other than the 
authorized end-user, as stated on the Shipper's Export Declaration in 
cases where an exemption is claimed under this subchapter.
    (e) Reexports or retransfers of U.S.-origin components incorporated 
into a foreign defense article to a government of a NATO country, or the 
governments of Australia or Japan, are authorized without the prior 
written approval of the Office of Defense Trade Controls, provided:

[[Page 360]]

    (1) The U.S.-origin components were previously authorized for export 
from the United States, either by a license or an exemption;
    (2) The U.S.-origin components are not significant military 
equipment, the items are not major defense equipment sold under a 
contract in the amount of $14,000,000 ($14 million) or more; the 
articles are not defense articles or defense services sold under a 
contract in the amount of $50,000,000 ($50 million) or more; and are not 
identified in part 121 of this subchapter as Missile Technology Control 
Regime (MTCR) items; and
    (3) The person reexporting the defense article must provide written 
notification to the Office of Defense Trade Controls of the retransfer 
not later than 30 days following the reexport. The notification must 
state the articles being reexported and the recipient government.
    (4) In certain cases, the Director, Office of Defense Trade 
Controls, may place retransfer restrictions on a license prohibiting use 
of this exemption.



Sec. 123.10  Non-transfer and use assurances.

    (a) A nontransfer and use certificate (Form DSP-83) is required for 
the export of significant military equipment and classified articles 
including classified technical data. A license will not be issued until 
a completed Form DSP-83 has been received by the Office of Defense Trade 
Controls. This form is to be executed by the foreign consignee, foreign 
end-user, and the applicant. The certificate stipulates that, except as 
specifically authorized by prior written approval of the Department of 
State, the foreign consignee and foreign end-user will not reexport, 
resell or otherwise dispose of the significant military equipment 
enumerated in the application outside the country named as the location 
of the foreign end-use or to any other person.
    (b) The Office of Defense Trade Controls may also require a DSP-83 
for the export of any other defense articles or defense services.
    (c) When a DSP-83 is required for an export of any defense article 
or defense service to a non-governmental foreign end-user, the Office of 
Defense Trade Controls may require as a condition of issuing the license 
that the appropriate authority of the government of the country of 
ultimate destination also execute the certificate.



Sec. 123.11  Movements of vessels and aircraft covered by the U.S. Munitions List outside the United States.

    (a) A license issued by the Office of Defense Trade Controls is 
required whenever a privately-owned aircraft or vessel on the U.S. 
Munitions List makes a voyage outside the United States.
    (b) Exemption. An export license is not required when a vessel or 
aircraft referred to in paragraph (a) of this section departs from the 
United States and does not enter the territorial waters or airspace of a 
foreign country if no defense articles are carried as cargo. Such a 
vessel or aircraft may not enter the territorial waters or airspace of a 
foreign country before returning to the United States, or carry as cargo 
any defense article, without a temporary export license (Form DSP-73) 
from the Department of State. (See Sec. 123.5.)



Sec. 123.12  Shipments between U.S. possessions.

    An export license is not required for the shipment of defense 
articles between the United States, the Commonwealth of Puerto Rico, and 
U.S. possessions. A license is required, however, for the export of 
defense articles from these areas to foreign countries.



Sec. 123.13  Domestic aircraft shipments via a foreign country.

    A license is not required for the shipment by air of a defense 
article from one location in the United States to another location in 
the United States via a foreign country. The pilot of the aircraft must, 
however, file a written statement with the District Director of Customs 
at the port of exit in the United States. The original statement must be 
filed at the time of exit with the District Director of Customs. A 
duplicate must be filed at the port of reentry with the District 
Director of Customs, who will duly endorse it and transmit it to the 
District Director of

[[Page 361]]

Customs at the port of exit. The statement will be as follows:

    Domestic Shipment Via a Foreign Country of Articles on the U.S. 
                             Munitions List

    Under penalty according to Federal law, the undersigned certifies 
and warrants that all the information in this document is true and 
correct, and that the equipment listed below is being shipped from (U.S. 
port of exit) via (foreign country) to (U.S. port of entry), which is 
the final destination in the United States.

                        Description of Equipment

 Quantity:______________________________________________________________
 Equipment:_____________________________________________________________
 Value:_________________________________________________________________
 Signed:________________________________________________________________

    Endorsement: Customs Inspector.

 Port of Exit___________________________________________________________
 Date:__________________________________________________________________
 Signed:________________________________________________________________
    Endorsement: Customs Inspector.
 Port of Entry:_________________________________________________________
 Date:__________________________________________________________________



Sec. 123.14  Import certificate/delivery verification procedure.

    (a) The Import Certificate/Delivery Verification Procedure is 
designed to assure that a commodity imported into the territory of those 
countries participating in IC/DV procedures will not be diverted, 
transshipped, or reexported to another destination except in accordance 
with export control regulations of the importing country.
    (b) Exports. The Office of Defense Trade Controls may require the 
IC/DV procedure on proposed exports of defense articles to non-
government entities in those countries participating in IC/DV 
procedures. In such cases, U.S. exporters must submit both an export 
license application (the completed Form DSP-5) and the original Import 
Certificate, which must be provided and authenticated by the government 
of the importing country. This document verifies that the foreign 
importer complied with the import regulations of the government of the 
importing country and that the importer declared the intention not to 
divert, transship or reexport the material described therein without the 
prior approval of that government. After delivery of the commodities to 
the foreign consignee, the Department of State may also require U.S. 
exporters to furnish Delivery Verification documentation from the 
government of the importing country. This documentation verifies that 
the delivery was in accordance with the terms of the approved export 
license. Both the Import Certificate and the Delivery Verification must 
be furnished to the U.S. exporter by the foreign importer.
    (c) Triangular transactions. When a transaction involves three or 
more countries that have adopted the IC/DV procedure, the governments of 
these countries may stamp a triangular symbol on the Import Certificate. 
This symbol is usually placed on the Import Certificate when the 
applicant for the Import Certificate (the importer) states either (1) 
that there is uncertainty whether the items covered by the Import 
Certificate will be imported into the country issuing the Import 
Certificate; (2) that he or she knows that the items will not be 
imported into the country issuing the Import Certificate; or (3) that, 
if the items are to be imported into the country issuing the Import 
Certificate, they will subsequently be reexported to another 
destination. All parties, including the ultimate consignee in the 
country of ultimate destination, must be shown on the completed Import 
Certificate.



Sec. 123.15  Congressional notification for licenses.

    (a) All exports of major defense equipment, as defined in Sec. 120.8 
of this subchapter, sold under a contract in the amount of $14,000,000 
or more, or exports of defense articles and defense services sold under 
a contract in the amount of $50,000,000 or more, may take place only 
after the Office of Defense Trade Controls notifies the exporter through 
issuance of a license or other approval that Congress has not enacted a 
joint resolution prohibiting the export and:
    (1) In the case of a license for an export to the North Atlantic 
Treaty Organization, any member country of that Organization, or 
Australia, Japan or New Zealand, 15 calendar days have elapsed since 
receipt by the Congress of the certification required by 22 U.S.C. 
2776(c)(1); or

[[Page 362]]

    (2) In the case of a license for an export to any other destination, 
30 calendar days have elapsed since receipt by the Congress of the 
certification required by 22 U.S.C. 2776(c)(1).
    (b) Persons who intend to export defense articles and defense 
services pursuant to any exemption in this subchapter (e.g., Sec. 126.5 
of this subchapter) under the circumstances described in the first 
sentence of paragraph (a) of this section must notify the Office of 
Defense Trade Controls by letter of the intended export and, prior to 
transmittal to Congress, provide a signed contract and a DSP-83 signed 
by the applicant, the foreign consignee and end-user.
[62 FR 67275, Dec. 24, 1997]



Sec. 123.16  Exemptions of general applicability.

    (a) The following exemptions apply to exports of unclassified 
defense articles for which no approval is needed from the Office of 
Defense Trade Controls. These exemptions do not apply to: Proscribed 
destinations under Sec. 126.1 of this subchapter; exports for which 
Congressional notification is required (see Sec. 123.15 of this 
subchapter); MTCR articles; Significant Military Equipment (SME); and 
may not be used by persons who are generally ineligible as described in 
Sec. 120.1(c) of this subchapter. All shipments of defense articles, 
including those to and from Canada, require a Shipper's Export 
Declaration (SED) or notification letter. If the export of a defense 
article is exempt from licensing, the SED must cite the exemption. Refer 
to Sec. 123.22 for Shipper's Export Declaration and letter notification 
requirements.
    (b) The following exports are exempt from the licensing requirements 
of this subchapter.
    (1) District Directors of Customs shall permit the export without a 
license of defense hardware being exported in furtherance of a 
manufacturing license agreement, technical assistance agreement, 
distribution agreement or an arrangement for distribution of items 
identified in Category XIII(b)(1), approved in accordance with Part 124, 
provided that:
    (i) The defense hardware to be exported supports the activity and is 
identified by item, quantity and value in the agreement or arrangement; 
and
    (ii) Any provisos or limitations placed on the authorized agreement 
or arrangement are adhered to; and
    (iii) The exporter certifies on the Shipper's Export Declaration 
that the export is exempt from the licensing requirements of this 
subchapter. This is done by writing, ``22 CFR 123.16(b)(1) and the 
agreement or arrangement (identify/state number) applicable''; and
    (iv) The total value of all shipments does not exceed the value 
authorized in the agreement or arrangement.
    (v) In the case of a distribution agreement, export must be made 
directly to the approved foreign distributor.
    (2) District Directors of Customs shall permit the export of 
components or spare parts (for exemptions for firearms and ammunition 
see Sec. 123.17) without a license when the total value does not exceed 
$500 in a single transaction and:
    (i) The components or spare parts are being exported to support a 
defense article previously authorized for export; and
    (ii) The spare parts or components are not going to a distributor, 
but to a previously approved end-user of the defense articles; and
    (iii) The spare parts or components are not to be used to enhance 
the capability of the defense article;
    (iv) exporters shall not split orders so as not to exceed the dollar 
value of this exemption;
    (v) the exporter may not make more than 24 shipments per calender 
year to the previously authorized end user;
    (vi) The exporter must certify on the Shipper's Export Declaration 
that the export is exempt from the licensing requirements of this 
subchapter. This is done by writing 22 CFR 123.16(b)(2) applicable.
    (3) District Directors of Customs shall permit the export without a 
license, of packing cases specially designed to carry defense articles.
    (4) District Directors of Customs shall permit the export without a 
license, of unclassified models or mock-ups of defense articles, 
provided that

[[Page 363]]

such models or mock-ups are nonoperable and do not reveal any technical 
data in excess of that which is exempted from the licensing requirements 
of Sec. 125.4(b) of this subchapter and do not contain components 
covered by the U.S. Munitions List (see Sec. 120.6(b) of this 
subchapter). Some models or mockups built to scale or constructed of 
original materials can reveal technical data. U.S. persons who avail 
themselves of this exemption must provide a written certification to the 
District Director of Customs that these conditions are met. This 
exemption does not imply that the Office of Defense Trade Controls will 
approve the export of any defense articles for which models or mocks-ups 
have been exported pursuant to this exemption.
    (5) District Directors of Customs shall permit the temporary export 
without a license of unclassified defense articles to any public 
exhibition, trade show, air show or related event if that article has 
previously been licensed for a public exhibition, trade show, air show 
or related event and the license is still valid. U.S. persons who avail 
themselves of this exemption must provide a written certification to the 
District Director of Customs that these conditions are met.
    (6) For exemptions for firearms and ammunition for personal use 
refer to Sec. 123.17.
    (7) For exemptions for firearms for personal use of members of the 
U.S. Armed Forces and civilian employees see Sec. 123.18.
    (8) For exports to Canada refer to Sec. 126.5 of this subchapter.
    (9) District Directors of Customs shall permit the temporary export 
without a license by a U.S. person of any unclassified component, part, 
tool or test equipment to a subsidiary, affiliate or facility owned or 
controlled by the U.S. person (see Sec. 122.2(c) of this subchapter) if 
the component, part, tool or test equipment is to be used for 
manufacture, assembly, testing, production, or modification provided:
    (i) The U.S. person is registered with the Office of Defense Trade 
Controls and complies with all requirements set forth in part 122 of 
this subchapter;
    (ii) No defense article exported under this exemption may be sold or 
transferred without the appropriate license or other approval from the 
Office of Defense Trade Controls.
[58 FR 39299, July 22, 1993, as amended at 59 FR 29951, June 10, 1994; 
59 FR 45622, Sept. 2, 1994]



Sec. 123.17  Exports of firearms and ammunition.

    (a) Except as provided in Sec. 126.1 of this subchapter, District 
Directors of Customs shall permit the export without a license of 
components and parts for Category I(a) firearms, except barrels, 
cylinders, receivers (frames) or complete breach mechanisms when the 
total value does not exceed $500 wholesale in any transaction.
    (b) District Directors of Customs shall permit the export without a 
license of nonautomatic firearms covered by Category I(a) of Sec. 121.1 
of this subchapter if they were manufactured in or before 1898, or are 
replicas of such firearms.
    (c) District Directors of Customs shall permit U.S. persons to 
export temporarily from the United States without a license not more 
than three nonautomatic firearms in Category I(a) of Sec. 121.1 of this 
subchapter and not more than 1,000 cartridges therefor, provided that:
    (1) A declaration by the U.S. person and an inspection by a customs 
officer is made;
    (2) The firearms and accompanying ammunition must be with the U.S. 
person's baggage or effects, whether accompanied or unaccompanied (but 
not mailed); and
    (3) They must be for that person's exclusive use and not for 
reexport or other transfer of ownership. The foregoing exemption is not 
applicable to a crew-member of a vessel or aircraft unless the crew-
member declares the firearms to a Customs officer upon each departure 
from the United States, and declares that it is his or her intention to 
return the article(s) on each return to the United States. It is also 
not applicable to the personnel referred to in Sec. 123.18.
    (d) District Directors of Customs shall permit a foreign person to 
export without a license such firearms in Category I(a) of Sec. 121.1 of 
this subchapter and ammunition therefor as the foreign

[[Page 364]]

person brought into the United States under the provisions of 27 CFR 
178.115(d). (The latter provision specifically excludes from the 
definition of importation the bringing into the United States of 
firearms and ammunition by certain foreign persons for specified 
purposes).
    (e) District Directors of Customs shall permit U.S. persons to 
export without a license ammunition for nonautomatic firearms referred 
to in paragraph (a) of this section if the quantity does not exceed 
1,000 cartridges (or rounds) in any shipment. The ammunition must also 
be for personal use and not for resale or other transfer of ownership. 
The foregoing exemption is also not applicable to the personnel referred 
to in Sec. 123.18.



Sec. 123.18  Firearms for personal use of members of the U.S. Armed Forces and civilian employees of the U.S. Government.

    The following exemptions apply to members of the U.S. Armed Forces 
and civilian employees of the U.S. Government who are U.S. persons (both 
referred to herein as personnel). The exemptions apply only to such 
personnel if they are assigned abroad for extended duty. These 
exemptions do not apply to dependents.
    (a) Firearms. District Directors of Customs shall permit 
nonautomatic firearms in Category I(a) of Sec. 121.1 of this subchapter 
and parts therefor to be exported, except by mail, from the United 
States without a license if:
    (1) They are consigned to servicemen's clubs abroad for uniformed 
members of the U.S. Armed Forces; or,
    (2) In the case of a uniformed member of the U.S. Armed Forces or a 
civilian employee of the Department of Defense, they are for personal 
use and not for resale or other transfer of ownership, and if the 
firearms are accompanied by a written authorization from the commanding 
officer concerned; or
    (3) In the case of other U.S. Government employees, they are for 
personal use and not for resale or other transfer of ownership, and the 
Chief of the U.S. Diplomatic Mission or his designee in the country of 
destination has approved in writing to Department of State the import of 
the specific types and quantities of firearms into that country. The 
exporter shall provide a copy of this written statement to the District 
Director of Customs.
    (b) Ammunition. District Directors of Customs shall permit not more 
than 1,000 cartridges (or rounds) of ammunition for the firearms 
referred to in paragraph (a) of this section to be exported (but not 
mailed) from the United States without a license when the firearms are 
on the person of the owner or with his baggage or effects, whether 
accompanied or unaccompanied (but not mailed).



Sec. 123.19  Canadian and Mexican border shipments.

    A shipment originating in Canada or Mexico which incidentally 
transits the United States en route to a delivery point in the same 
country that originated the shipment is exempt from the requirement for 
an in transit license.



Sec. 123.20  Nuclear materials.

    (a) The provisions of this subchapter do not apply to equipment in 
Category VI(e) and Category XVI of Sec. 121.1 of this subchapter to the 
extent such equipment is under the export control of the Department of 
Energy or the Nuclear Regulatory Commission pursuant to the Atomic 
Energy Act of 1954, as amended, and the Nuclear Non-Proliferation Act of 
1978.
    (b) A license for the export of any machinery, device, component, 
equipment, or technical data relating to equipment referred to in 
Category VI(e) will not be granted unless the proposed export comes 
within the scope of an existing Agreement for Cooperation for Mutual 
Defense Purposes concluded pursuant to the Atomic Energy Act of 1954, as 
amended, with the government of the country to which the article is to 
be exported. Licenses may be granted in the absence of such an agreement 
only (1) if the proposed export involves an article which is identical 
to that in use in an unclassified civilian nuclear power plant, (2) if 
the proposed export has no relationship to naval nuclear propulsion, and 
(3) if it is not for use in a naval propulsion plant.

[[Page 365]]



Sec. 123.21  Duration, renewal and disposition of licenses.

    (a) A license is valid for four years. The license expires when the 
total value or quantity authorized has been shipped or when the date of 
expiration has been reached, whichever occurs first. Defense articles to 
be shipped thereafter require a new application and license. The new 
application should refer to the expired license. It should not include 
references to any defense articles other than those of the unshipped 
balance of the expired license.
    (b) Unused, expired, expended, suspended, or revoked licenses must 
be returned immediately to the Department of State.



Sec. 123.22  Filing of export licenses and Shipper's Export Declarations with District Directors of Customs.

    (a) The exporter must deposit the license with the District Director 
of Customs at the port of exit before shipment, unless paragraph (d) of 
this section or Sec. 125.9 applies (for exports by mail, see 
Sec. 123.24). Licenses for temporary export or temporary import are to 
be retained by the exporter and presented to the District Director of 
Customs at the time of import or export for endorsement. If necessary, 
the export may be made through a port other than the one designated on 
the license if the exporter complies with the procedures established by 
the U.S. Customs Service. Every license will be returned to the Office 
of Defense Trade Controls by the District Director of Customs when the 
total value or quantity authorized has been shipped or when the date of 
expiration is reached, whichever occurs first.
    (b) Before shipping any defense article, the exporter must also file 
a Shipper's Export Declaration with the District Director of Customs at 
the port of exit (unless otherwise exempt from filing a Shipper's Export 
Declaration). The District Director of Customs at the port of exit must 
authenticate the Shipper's Export Declaration, and endorse the license 
to show the shipments actually made. The District Director of Customs 
will return a copy of each authenticated Shipper's Export Declaration to 
the Office of Defense Trade Controls.
    (c) Except for the export of unclassified technical data, an 
exporter must file a Shipper's Export Declaration with District 
Directors of Customs or Postmasters in those cases in which no export 
license is required because of an exemption under this subchapter. The 
exporter must certify that the export is exempt from the licensing 
requirements of this subchapter by writing 22 CFR (identify section) and 
22 CFR 120.1(b) applicable on the Shipper's Export Declaration, and by 
identifying the section under which an exemption is claimed. A copy of 
each such declaration must be mailed immediately by the exporter to the 
Office of Defense Trade Controls.
    (d) A Shipper's Export Declaration is not required for exports of 
unclassified technical data. Exporters shall notify the Office of 
Defense Trade Controls of the initial export of the data by either 
returning the license after self endorsement or by sending a letter to 
the Office of Defense Trade Controls. The letter shall provide the 
method, date, license number and airway bill number (if applicable) of 
the shipment. The letter must be signed by an empowered official of the 
company and provided to the Office of Defense Trade Controls within 
thirty days of the initial export.
    (e) If a license for the export of unclassified defense articles, 
including technical data, is used but not endorsed by U.S. Customs or a 
Postmaster for whatever reason (e.g., electronic transmission, 
unavailability of Customs officer or Postmaster, etc.), the person 
exporting the article must self-endorse the license, showing when and 
how the export took place. Every license shall also be returned by the 
exporter to the Office of Defense Trade Controls when the total value or 
quantity authorized has been shipped or when the date of expiration is 
reached, whichever occurs first.
[58 FR 39299, July 22, 1993, as amended at 61 FR 48831, Sept. 17, 1996]



Sec. 123.23  Monetary value of shipments.

    District Directors of Customs shall permit the shipment of defense 
articles identified on any license when the

[[Page 366]]

total value of the export does not exceed the aggregate monetary value 
(not quantity) stated on the license by more than ten percent, provided 
that the additional monetary value does not make the total value of the 
license or other approval for the export of any major defense equipment 
sold under a contract reach $14,000,000 or more, and provided that the 
additional monetary value does not make defense articles or defense 
services sold under a contract reach the amount of $50,000,000 or more.



Sec. 123.24  Shipments by mail.

    A Shipper's Export Declaration must be authenticated before an 
article is actually sent abroad by mail (see Sec. 123.22(d)). The 
postmaster or exporter will endorse each license to show the shipments 
made. Every license must be returned by the exporter to the Office of 
Defense Trade Controls upon completion of the mailings.



Sec. 123.25  Amendments to licenses.

    (a) The Office of Defense Trade Controls may approve an amendment to 
a license for permanent export, temporary export and temporary import of 
unclassified defense articles. A suggested format is available from the 
Office of Defense Trade Controls.
    (b) The following types of amendments to a license that will be 
considered: Addition of U.S. freight forwarder or U.S. consignor; change 
due to an obvious typographical error; change in source of commodity; 
and change of foreign intermediate consignee if that party is only 
transporting the equipment and will not process (e.g., integrate, 
modify) the equipment. For changes in U.S. dollar value see Sec. 123.23.
    (c) The following types of amendments to a license will not be 
approved: Additional quantity, changes in commodity, country of ultimate 
destination, end-use or end-user, foreign consignee and/or extension of 
duration. The foreign intermediate consignee may only be amended if that 
party is acting as freight forwarder and the export does not involve 
technical data. A new license is required for these changes. Any new 
license submission must reflect only the unshipped balance of quantity 
and dollar value.



Sec. 123.26  Recordkeeping requirement for exemptions.

    When an exemption is claimed for the export of unclassified 
technical data, the exporter must maintain a record of each such export. 
The business record should include the following information: A 
description of the unclassified technical data, the name of the 
recipient end-user, the date and time of the export, and the method of 
transmission.



Sec. 123.27  Temporary export for personal use of Category XIII(b)(1) cryptographic products.

    (a) District Directors of Customs may permit a U.S. citizen or a 
U.S. person who is a lawful permanent resident as defined by 8 U.S.C. 
1101(a)(20) to temporarily export from the United States without a 
license not more than one each of any unclassified Category XIII(b)(1) 
cryptographic hardware product and not more than a single copy of each 
type of unclassified Category XIII(b)(1) cryptographic software product 
provided that:
    (1) The software product(s) are to be used only on a simultaneously 
temporarily exported Category XIII(b)(1) hardware product or a 
simultaneously exported item on the Commerce Control List (CCL); and
    (2) The cryptographic products covered by Category XIII(b)(1) are 
not destined for export to a destination listed in Sec. 126.1 of the 
ITAR (22 CFR 126.1) which is prohibited by a United Nations Security 
Council Resolution or to which the export (or for which the issuance of 
a license for the export) would be prohibited by a U.S. statute (e.g., 
by Section 40 of the Arms Export Control Act, 22 U.S.C. 2780, to 
countries that have been determined to have repeatedly provided support 
for acts of international terrorism--currently Cuba, Iran, Iraq, Libya, 
North Korea, Sudan and Syria); and
    (3)(i) The encryption products remain in the possession of the 
exporting person or the possession of another U.S. citizen or lawful 
permanent resident traveling with him/her, are for their exclusive use 
and not for copying, demonstration, marketing, sale, re-export or 
transfer of ownership or control. The export of cryptographic products

[[Page 367]]

identified in Category XIII(b)(1) in any other circumstances, for 
example, those in which a person contemplates sales, marketing, or 
demonstration must be licensed in accordance with policies and 
procedures established in this subchapter.
    (ii) Special definition. For purposes of paragraph (a)(3)(i) of this 
section, a product is considered to be in the possession of the exporter 
if:
    (A) The exporter takes normal precautions to ensure the security of 
the product by locking the product in a hotel room, safe, or other 
comparably secure location; and
    (B) While in transit, the exporter keeps the product in his/her 
carry-on luggage or locked in baggage accompanying the exporter which 
has been checked with the carrier; and
    (4) At the time of export from the U.S. and import into the U.S., 
the cryptographic products are with the individual's accompanying 
baggage or effects. They may not be exported or imported in 
unaccompanied baggage, mailed or transmitted by any other means (e.g., 
electronically); and, the cryptographic products must be returned to the 
U.S. at the completion of the stay abroad; and
    (5) The exporter, upon request of a U.S. Customs officer, will 
submit the products to inspection at the time of export and/or import.
    (b) Use of this exemption requires the exporter, in lieu of filing a 
Shippers' Export Declaration, to maintain, for a period of 5 years from 
the date of each temporary export, a record of that temporary export and 
the subsequent import. Included in this record must be a self 
certification that the individual complied with the conditions of 
paragraph (a) of this section and a self certification that he/she has 
no reason to believe that any of the temporarily exported cryptographic 
products were stolen, lost, copied, sold or otherwise compromised or 
transferred while abroad. The record should include the following 
information: A description of the unclassified cryptographic products; 
the countries entered, including the dates of entry and exit for each 
foreign country; and, the dates of temporary export from and subsequent 
import into the United States.
    (c) In any instance where a product exported under this exemption is 
stolen, lost, copied, sold or otherwise compromised or transferred while 
abroad, the exporting person must, within 10 days of his/her return to 
the United States, report the incident to the Department of State, 
Office of Defense Trade Controls, Washington, DC 20520-0602. Also, any 
person who knows or has reason to know that cryptographic products 
exported under this exemption are being transferred, exported, or used 
for any other activity which must be licensed or otherwise authorized in 
writing by the Department of State, should immediately inform the 
Department of State, Office of Defense Trade Controls, Washington DC 
20520-0602.
[61FR 6112, Feb. 16, 1996]



PART 124--AGREEMENTS, OFF-SHORE PROCUREMENT AND OTHER DEFENSE SERVICES--Table of Contents




Sec.
124.1  Manufacturing license agreements and technical assistance 
          agreements.
124.2  Exemptions for training and military service.
124.3  Exports of technical data in furtherance of an agreement.
124.4  Deposit of signed agreements with the Office of Defense Trade 
          Controls.
124.5  Proposed agreements that are not concluded.
124.6  Termination of manufacturing license agreements and technical 
          assistance agreements.
124.7  Information required in all manufacturing license agreements and 
          technical assistance agreements.
124.8  Clauses required both in manufacturing license agreements and 
          technical assistance agreements.
124.9  Additional clauses required only in manufacturing license 
          agreements.
124.10  Nontransfer and use assurances.
124.11  Certification to Congress for agreements.
124.12  Required information in letters of transmittal.
124.13  Procurement by United States persons in foreign countries 
          (offshore procurement).
124.14  Exports to warehouses or distribution points outside the United 
          States.
124.15  Arrangements for U.S. encryption (Category XIII(b)(1)) 
          distribution by manufacturers.

    Authority:  Sec. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2797);

[[Page 368]]

E.O. 11958, 42 FR 4311; 3 CFR 1977 Comp. p. 79; 22 U.S.C. 2658.

    Source:  58 FR 39305, July 22, 1993, unless otherwise noted.



Sec. 124.1  Manufacturing license agreements and technical assistance agreements.

    (a) The approval of the Office of Defense Trade Controls must be 
obtained before the defense services described in Sec. 120.9(a) of this 
subchapter may be furnished. In order to obtain such approval, the U.S. 
person must submit a proposed agreement to the Office of Defense Trade 
Controls. Such agreements are generally characterized as either 
Manufacturing license agreements, technical assistance agreements, 
distribution agreements or off-shore procurement agreements, and may not 
enter into force without the prior written approval of the Office of 
Defense Trade Controls. Once approved, the defense services described in 
the agreements may generally be provided without further licensing in 
accordance with Secs. 124.3 and 125.4(b)(2) of this subchapter. The 
requirements of this section apply whether or not technical data is to 
be disclosed or used in the performance of the defense services 
described in Sec. 120.9(a) of this subchapter (e.g., all the information 
relied upon by the U.S. person in performing the defense service is in 
the public domain or is otherwise exempt from the licensing requirements 
of this subchapter pursuant to Sec. 125.4 of this subchapter). This 
requirement also applies to the training of any foreign military forces, 
regular and irregular, in the use of defense articles. Technical 
assistance agreements must be submitted in such cases. In exceptional 
cases, The Office of Defense Trade Controls, upon written request, will 
consider approving the provision of defense services described in 
Sec. 120.9(a) of this subchapter by granting a license under part 125 of 
this subchapter. Also, see Sec. 126.8 of this subchapter for the 
requirements for prior approval of proposals relating to significant 
military equipment.
    (b) Classified Articles. Copies of approved agreements involving the 
release of classified defense articles will be forwarded by the Office 
of Defense Trade Controls to the Defense Investigative Service of the 
Department of Defense.
    (c) Amendments. Changes to the scope of approved agreements, 
including modifications, upgrades, or extensions must be submitted for 
approval. The amendments may not enter into force until approved by the 
Office of Defense Trade Controls.
    (d) Minor Amendments. Amendments which only alter delivery or 
performance schedules, or other minor administrative amendments which do 
not affect in any manner the duration of the agreement or the clauses or 
information which must be included in such agreements because of the 
requirements of this part, do not have to be submitted for approval. One 
copy of all such minor amendments must be submitted to the Office of 
Defense Trade Controls within thirty days after they are concluded.



Sec. 124.2  Exemptions for training and military service.

    (a) Technical assistance agreements are not required for the 
provision of training in the basic operation and maintenance of defense 
articles lawfully exported or authorized for export to the same 
recipient. This does not include training in intermediate and depot 
level maintenance.
    (b) Services performed as a member of the regular military forces of 
a foreign nation by U.S. persons who have been drafted into such forces 
are not deemed to be defense services for purposes of Sec. 120.9 of this 
subchapter.



Sec. 124.3  Exports of technical data in furtherance of an agreement.

    (a) Unclassified technical data. District Directors of Customs or 
postal authorities shall permit the export without a license of 
unclassified technical data if the export is in furtherance of a 
manufacturing license or technical assistance agreement which has been 
approved in writing by the Office of Defense Trade Controls and the 
technical data being exported does not exceed the scope or limitations 
of the relevant agreement. The U.S. party to the agreement must certify 
on the Shippers Export Declaration that the export does not exceed the 
scope of the

[[Page 369]]

agreement and any limitations imposed pursuant to this part. The 
approval of the Office of Defense Trade Controls must be obtained for 
the export of any unclassified technical data which may exceed the terms 
of the agreement.
    (b) Classified technical data. The export of classified information 
in furtherance of an approved manufacturing license or technical 
assistance agreement which provides for the transmittal of classified 
information does not require further approval from the Office of Defense 
Trade Controls when:
    (1) The United States party certifies to the Department of Defense 
transmittal authority that the classified information does not exceed 
the technical or product limitations in the agreement; and
    (2) The U.S. party complies with the requirements of the Department 
of Defense Industrial Security Manual concerning the transmission of 
classified information and any other requirements of cognizant U.S. 
departments or agencies.



Sec. 124.4  Deposit of signed agreements with the Office of Defense Trade Controls.

    (a) The United States party to a manufacturing license or a 
technical assistance agreement must file one copy of the concluded 
agreement with the Office of Defense Trade Controls not later than 30 
days after it enters into force. If the agreement is not concluded 
within one year of the date of approval, the Office of Defense Trade 
Controls must be notified in writing and be kept informed of the status 
of the agreement until the requirements of this paragraph or the 
requirements of Sec. 124.5 are satisfied.
    (b) In the case of concluded agreements involving coproduction or 
licensed production outside of the United States of defense articles of 
United States origin, a written statement must accompany filing of the 
concluded agreement with the Office of Defense Trade Controls, which 
shall include:
    (1) The identity of the foreign countries, international 
organization, or foreign firms involved;
    (2) A description and the estimated value of the articles authorized 
to be produced, and an estimate of the quantity of the articles 
authorized to be produced:
    (3) A description of any restrictions on third-party transfers of 
the foreign-manufactured articles; and
    (4) If any such agreement does not provide for United States access 
to and verification of quantities of articles produced overseas and 
their disposition in the foreign country, a description of alternative 
measures and controls to ensure compliance with restrictions in the 
agreement on production quantities and third-party transfers.
[62 FR 67276, Dec. 24, 1997]



Sec. 124.5  Proposed agreements that are not concluded.

    The United States party to any proposed manufacturing license 
agreement or technical assistance agreement must inform the Office of 
Defense Trade Controls if a decision is made not to conclude the 
agreement. The information must be provided within 60 days of the date 
of the decision. These requirements apply only if the approval of the 
Office of Defense Trade Controls was obtained for the agreement to be 
concluded (with or without any provisos).



Sec. 124.6  Termination of manufacturing license agreements and technical assistance agreements.

    The U. S. party to a manufacturing license or a technical assistance 
agreement must inform the Office of Defense Trade Controls in writing of 
the impending termination of the agreement not less than 30 days prior 
to the expiration date of such agreement.



Sec. 124.7  Information required in all manufacturing license agreements and technical assistance agreements.

    The following information must be included in all proposed 
manufacturing license agreements and technical assistance agreements. 
The information should be provided in terms which are as precise as 
possible. If the applicant believes that a clause or that required 
information is not relevant or necessary, the applicant may request the

[[Page 370]]

omission of the clause or information. The transmittal letter 
accompanying the agreement must state the reasons for any proposed 
variation in the clauses or required information.
    (1) The agreement must describe the defense article to be 
manufactured and all defense articles to be exported, including any test 
and support equipment or advanced materials. They should be described by 
military nomenclature, contract number, National Stock Number, nameplate 
data, or other specific information. Supporting technical data or 
brochures should be submitted in seven copies. Only defense articles 
listed in the agreement will be eligible for export under the exemption 
in Sec. 123.16(b)(1) of this subchapter.
    (2) The agreement must specifically describe the assistance and 
technical data, including the design and manufacturing know-how 
involved, to be furnished and any manufacturing rights to be granted;
    (3) The agreement must specify its duration; and
    (4) The agreement must specifically identify the countries or areas 
in which manufacturing, production, processing, sale or other form of 
transfer is to be licensed.



Sec. 124.8  Clauses required both in manufacturing license agreements and technical assistance agreements.

    The following statements must be included both in manufacturing 
license agreements and in technical assistance agreements:
    (1) ``This agreement shall not enter into force, and shall not be 
amended or extended, without the prior written approval of the 
Department of State of the U.S. Government.''
    (2) ``This agreement is subject to all United States laws and 
regulations relating to exports and to all administrative acts of the 
U.S. Government pursuant to such laws and regulations.''
    (3) ``The parties to this agreement agree that the obligations 
contained in this agreement shall not affect the performance of any 
obligations created by prior contracts or subcontracts which the parties 
may have individually or collectively with the U.S. Government.''
    (4) ``No liability will be incurred by or attributed to the U.S. 
Government in connection with any possible infringement of privately 
owned patent or proprietary rights, either domestic or foreign, by 
reason of the U.S. Government's approval of this agreement.''
    (5) ``The technical data or defense service exported from the United 
States in furtherance of this agreement and any defense article which 
may be produced or manufactured from such technical data or defense 
service may not be transferred to a person in a third country or to a 
national of a third country except as specifically authorized in this 
agreement unless the prior written approval of the Department of State 
has been obtained.''
    (6) ``All provisions in this agreement which refer to the United 
States Government and the Department of State will remain binding on the 
parties after the termination of the agreement.''



Sec. 124.9  Additional clauses required only in manufacturing license agreements.

    (a) Clauses for all manufacturing license agreements. The following 
clauses must be included only in manufacturing license agreements:
    (1) ``No export, sale, transfer, or other disposition of the 
licensed article is authorized to any country outside the territory 
wherein manufacture or sale is herein licensed without the prior written 
approval of the U.S. Government unless otherwise exempted by the U.S. 
Government. Sales or other transfers of the licensed article shall be 
limited to governments of countries wherein manufacture or sale is 
hereby licensed and to private entities seeking to procure the licensed 
article pursuant to a contract with any such government unless the prior 
written approval of the U.S. Government is obtained.''
    (2) ``It is agreed that sales by licensee or its sub-licensees under 
contracts made through the U.S. Government will not include either 
charges for patent rights in which the U.S. Government holds a royalty-
free license, or charges for data which the U.S. Government has a right 
to use and disclose to others, which are in the public domain, or which 
the U.S. Government

[[Page 371]]

has acquired or is entitled to acquire without restrictions upon their 
use and disclosure to others.''
    (3) ``If the U.S. Government is obligated or becomes obligated to 
pay to the licensor royalties, fees, or other charges for the use of 
technical data or patents which are involved in the manufacture, use, or 
sale of any licensed article, any royalties, fees or other charges in 
connection with purchases of such licensed article from licensee or its 
sub-licensees with funds derived through the U.S. Government may not 
exceed the total amount the U.S. Government would have been obligated to 
pay the licensor directly.''
    (4) ``If the U.S. Government has made financial or other 
contributions to the design and development of any licensed article, any 
charges for technical assistance or know-how relating to the item in 
connection with purchases of such articles from licensee or sub-
licensees with funds derived through the U.S. Government must be 
proportionately reduced to reflect the U.S. Government contributions, 
and subject to the provisions of paragraphs (a) (2) and (3) of this 
section, no other royalties, or fees or other charges may be assessed 
against U.S. Government funded purchases of such articles. However, 
charges may be made for reasonable reproduction, handling, mailing, or 
similar administrative costs incident to the furnishing of such data.''
    (5) ``The parties to this agreement agree that an annual report of 
sales or other transfers pursuant to this agreement of the licensed 
articles, by quantity, type, U.S. dollar value, and purchaser or 
recipient, shall be provided by (applicant or licensee) to the 
Department of State.'' This clause must specify which party is obligated 
to provide the annual report. Such reports may be submitted either 
directly by the licensee or indirectly through the licensor, and may 
cover calendar or fiscal years. Reports shall be deemed proprietary 
information by the Department of State and will not be disclosed to 
unauthorized persons. See Sec. 126.10(b) of this subchapter.
    (6) (Licensee) agrees to incorporate the following statement as an 
integral provision of a contract, invoice or other appropriate document 
whenever the licensed articles are sold or otherwise transferred:

    These commodities are authorized for export by the U.S. Government 
only to (country of ultimate destination or approved sales territory). 
They may not be resold, diverted, transferred, transshipped, or 
otherwise be disposed of in any other country, either in their original 
form or after being incorporated through an intermediate process into 
other end-items, without the prior written approval of the U.S. 
Department of State.

    (b) Special clause for agreements relating to significant military 
equipment. With respect to an agreement for the production of 
significant military equipment, the following additional provisions must 
be included in the agreement:
    (1) ``A completed nontransfer and use certificate (DSP-83) must be 
executed by the foreign end-user and submitted to the Department of 
State of the United States before any transfer may take place.''
    (2) ``The prior written approval of the U.S. Government must be 
obtained before entering into a commitment for the transfer of the 
licensed article by sale or otherwise to any person or government 
outside of the approved sales territory.''



Sec. 124.10  Nontransfer and use assurances.

    (a) Types of agreements requiring assurances. With respect to any 
manufacturing license agreement or technical assistance agreement which 
relates to significant military equipment or classified defense 
articles, including classified technical data, a Nontransfer and Use 
Certificate (Form DSP-83) (see Sec. 123.10 of this subchapter) signed by 
the applicant and the foreign party must be submitted to the Office of 
Defense Trade Controls. With respect to all agreements involving 
classified articles, including classified technical data, an authorized 
representative of the foreign government must sign the DSP-83 (or 
provide the same assurances in the form of a diplomatic note), unless 
the Office of Defense Trade Controls has granted an exception to this 
requirement. The Office of Defense Trade controls may require that a 
DSP-83 be provided in conjunction with

[[Page 372]]

an agreement that does not relate to significant military equipment or 
classified defense articles. The Office of Defense Trade Controls may 
also require with respect to any agreement that an appropriate authority 
of the foreign party's government also sign the DSP-83 (or provide the 
same assurances in the form of a diplomatic note).
    (b) Timing of submission of assurances. Submission of a Form DSP-83 
and/or diplomatic note must occur as follows:
    (1) Agreements which have been signed by all parties before being 
submitted to the Office of Defense Trade Controls may only be submitted 
along with any required DSP-83 and/or diplomatic note.
    (2) If an agreement has not been signed by all parties before being 
submitted, the required DSP-83 and/or diplomatic note must be submitted 
along with the signed agreement.

    Note: In no case may a transfer occur before a required DSP-83 and/
or diplomatic note has been submitted to the Office of Defense Trade 
Controls.

[59 FR 29951, June 10, 1994]



Sec. 124.11  Certification to Congress for agreements.

    Regardless of dollar value, a Technical Assistance Agreement or a 
Manufacturing License Agreement that involves the manufacture abroad of 
any item of significant military equipment (as defined in Sec. 120.7 of 
this subchapter) shall be certified to Congress by the Department as 
required by 22 U.S.C. 2776(d). Additionally, any technical assistance 
agreement or manufacturing license agreement providing for the export of 
major defense equipment, as defined in Sec. 120.8, sold under a contract 
in the amount of $14 million or more, or of defense articles or defense 
services sold under a contract in the amount of $50 million or more, 
shall be certified to Congress by the Department as required by 22 
U.S.C. 2776(c)(1). The Office of Defense Trade Controls will not approve 
agreements requiring Congressional notification unless Congress has not 
enacted a joint resolution prohibiting the agreement and:
    (a) In the case of an agreement for or in a country which is a 
member of the North Atlantic Treaty Organization or Australia, Japan, or 
New Zealand, at least 15 calendar days have elapsed since receipt by the 
Congress of the certification required by 22 U.S.C. 2776(d); or
    (b) In the case of an agreement for or in any other country, at 
least 30 calendar days have elapsed since receipt by the Congress of the 
certification required by 22 U.S.C. 2776(d).
[62 FR 67276, Dec. 24, 1997]



Sec. 124.12  Required information in letters of transmittal.

    (a) An application for the approval of a manufacturing license or 
technical assistance agreement with a foreign person must be accompanied 
by an explanatory letter. The original letter and seven copies of the 
letter and eight copies of the proposed agreement shall be submitted to 
the Office of Defense Trade Controls. The explanatory letter shall 
contain:
    (1) A statement giving the applicant's Defense Trade Controls 
registration number.
    (2) A statement identifying the licensee and the scope of the 
agreement.
    (3) A statement identifying the U.S. Government contract under which 
the equipment or technical data was generated, improved, or developed 
and supplied to the U.S. Government, and whether the equipment or 
technical data was derived from any bid or other proposal to the U.S. 
Government.
    (4) A statement giving the military security classification of the 
equipment or technical data.
    (5) A statement identifying any patent application which discloses 
any of the subject matter of the equipment or technical data covered by 
an invention secrecy order issued by the U.S. Patent and Trademark 
Office.
    (6) A statement of the actual or estimated value of the agreement, 
including the estimated value of all defense articles to be exported in 
furtherance of the agreement or amendments thereto. If the value is 
$500,000 or more, an additional statement must be made regarding the 
payment of political contributions, fees or commissions, pursuant to 
part 130 of this subchapter.
    (7) A statement indicating whether any foreign military sales 
credits or

[[Page 373]]

loan guarantees are or will be involved in financing the agreement.
    (8) The agreement must describe any classified information involved 
and identify, from Department of Defense form DD254, the address and 
telephone number of the U.S. Government office that classified the 
information.
    (9) For agreements that may require the export of classified 
information, the Defense Investigative Service cognizant security 
offices that have responsibility for the facilities of the U.S. parties 
to the agreement shall be identified. The facility security clearance 
codes of the U.S. parties shall also be provided.
    (b) The following statements must be made in the letter of 
transmittal:
    (1) ``If the agreement is approved by the Department of State, such 
approval will not be construed by (the applicant) as passing on the 
legality of the agreement from the standpoint of antitrust laws or other 
applicable statutes, nor will (the applicant) construe the Department's 
approval as constituting either approval or disapproval of any of the 
business terms or conditions between the parties to the agreement.''
    (2) ``The (applicant) will not permit the proposed agreement to 
enter into force until it has been approved by the Department of 
State.''
    (3) ``The (applicant) will furnish the Department of State with one 
copy of the signed agreement (or amendment) within 30 days from the date 
that the agreement is concluded and will inform the Department of its 
termination not less than 30 days prior to expiration and provide 
information on the continuation of any foreign rights or the flow of 
technical data to the foreign party. If a decision is made not to 
conclude the proposed agreement, the applicant will so inform the 
Department within 60 days.''
    (4) ``If this agreement grants any rights to sub-license, it will be 
amended to require that all sub-licensing arrangements incorporate all 
the provisions of the basic agreement that refer to the U.S. Government 
and the Department of State (i.e., 22 CFR 124.9 and 124.10).''



Sec. 124.13  Procurement by United States persons in foreign countries (offshore procurement).

    Notwithstanding the other provisions in part 124 of this subchapter, 
the Office of Defense Trade Controls may authorize by means of a license 
(DSP-5) the export of unclassified technical data to foreign persons for 
offshore procurement of defense articles, provided that:
    (a) The contract or purchase order for offshore procurement limits 
delivery of the defense articles to be produced only to the person in 
the United States or to an agency of the U.S. Government; and
    (b) The technical data of U.S.-origin to be used in the foreign 
manufacture of defense articles does not exceed that required for bid 
purposes on a build-to-print basis (build-to-print means producing an 
end-item (i.e., system, subsystem or component) from technical drawings 
and specifications (which contain no process or know-how information) 
without the need for additional technical assistance). Release of 
supporting documentation (e.g., acceptance criteria, object code 
software for numerically controlled machines) is permissible. Build-to-
print does not include the release of any information which discloses 
design methodology, engineering analysis, detailed process information 
or manufacturing know-how); and
    (c) The contract or purchase order between the person in the United 
States and the foreign person:
    (1) Limits the use of the technical data to the manufacture of the 
defense articles required by the contract or purchase order only; and
    (2) Prohibits the disclosure of the data to any other person except 
subcontractors within the same country; and
    (3) Prohibits the acquisition of any rights in the data by any 
foreign person; and
    (4) Provides that any subcontracts between foreign persons in the 
approved country for manufacture of equipment for delivery pursuant to 
the contract or purchase order contain all the limitations of this 
paragraph (c); and

[[Page 374]]

    (5) Requires the foreign person, including subcontractors, to 
destroy or return to the person in the United States all of the 
technical data exported pursuant to the contract or purchase order upon 
fulfillment of their terms; and
    (6) Requires delivery of the defense articles manufactured abroad 
only to the person in the United States or to an agency of the U.S. 
Government; and
    (d) The person in the United States provides the Office of Defense 
Trade Controls with a copy of each contract, purchase order or 
subcontract for offshore procurement at the time it is accepted. Each 
such contract, purchase order or subcontract must clearly identify the 
article to be produced and must identify the license number or exemption 
under which the technical data was exported; and
    (e) Licenses issued pursuant to this section must be renewed upon 
their expiration if offshore procurement is to extend beyond the period 
of validity of the license. If the technical data involved in an 
offshore procurement arrangement is otherwise exempt from the licensing 
requirements pursuant to Sec. 126.4 or Sec. 126.5 of this subchapter, 
the DSP-5 referred to in the first sentence of this section is not 
required. However, the exporter must comply with the other requirements 
of this section. The exemptions under Sec. 125.4 of this subchapter may 
not be used to establish offshore procurement arrangements.



Sec. 124.14  Exports to warehouses or distribution points outside the United States.

    (a) Agreements (e.g., contracts) between U.S. persons and foreign 
persons for the warehousing and distribution of defense articles must be 
approved by the Office of Defense Trade Controls before they enter into 
force. Such agreements will be limited to unclassified defense articles 
and must contain conditions for special distribution, end-use and 
reporting. Licenses for exports pursuant to such agreements must be 
obtained prior to exports of the defense articles unless an exemption 
under Sec. 123.16(b)(1) of this subchapter is applicable.
    (b) Required Information. Proposed warehousing and distribution 
agreements (and amendments thereto) shall be submitted to the Office of 
Defense Trade Controls for approval. The following information must be 
included in all such agreements:
    (1) A description of the defense articles involved including test 
and support equipment covered by the U.S. Munitions List. This shall 
include when applicable the military nomenclature, the Federal stock 
number, nameplate data, and any control numbers under which the defense 
articles were developed or procured by the U.S. Government. Only those 
defense articles specifically listed in the agreement will be eligible 
for export under the exemption in Sec. 123.16(b)(1) of this subchapter.
    (2) A detailed statement of the terms and conditions under which the 
defense articles will be exported and distributed;
    (3) The duration of the proposed agreement;
    (4) Specific identification of the country or countries that 
comprise the distribution territory. Distribution must be specifically 
limited to the governments of such countries or to private entities 
seeking to procure defense articles pursuant to a contract with a 
government within the distribution territory or to other eligible 
entities as specified by the Office of Defense Trade Controls. 
Consequently, any deviation from this condition must be fully explained 
and justified. A nontransfer and use certificate (DSP-83) will be 
required to the same extent required in licensing agreements under 
Sec. 124.9(b).
    (c) Required statements. The following statements must be included 
in all warehousing and distribution agreements:
    (1) ``This agreement shall not enter into force, and may not be 
amended or extended, without the prior written approval of the 
Department of State of U.S. Government.''
    (2) ``This agreement is subject to all United States laws and 
regulations related to exports and to all administrative acts of the 
United States Government pursuant to such laws and regulations.

[[Page 375]]

    (3) ``The parties to this agreement agree that the obligations 
contained in this agreement shall not affect the performance of any 
obligations created by prior contracts or subcontracts which the parties 
may have individually or collectively with the U.S. Government.''
    (4) ``No liability will be incurred by or attributed to the U.S. 
Government in connection with any possible infringement of privately 
owned patent or proprietary rights, either domestic or foreign by reason 
of the U.S. Government's approval of this agreement.''
    (5) ``No export, sale, transfer, or other disposition of the defense 
articles covered by this agreement is authorized to any country outside 
the distribution territory without the prior written approval of the 
Office of Defense Trade Controls of the U.S. Department of State.''
    (6) ``The parties to this agreement agree that an annual report of 
sales or other transfers pursuant to this agreement of the licensed 
articles, by quantity, type, U.S. dollar value, and purchaser or 
recipient shall be provided by (applicant or licensee) to the Department 
of State.'' This clause must specify which party is obligated to provide 
the annual report. Such reports may be submitted either directly by the 
licensee or indirectly through the licensor, and may cover calendar or 
fiscal years. Reports shall be deemed proprietary information by the 
Department of State and will not be disclosed to unauthorized persons. 
(See Sec. 126.10(b) of this subchapter.)
    (7) (Licensee) agrees to incorporate the following statement as an 
integral provision of a contract, invoice or other appropriate document 
whenever the articles covered by this agreement are sold or otherwise 
transferred:

    These commodities are authorized for export by the U.S. Government 
only to (country of ultimate destination or approved sales territory). 
They may not be resold, diverted, transferred, transshipped, or 
otherwise be disposed of in any other country, either in their original 
form or after being incorporated through an intermediate process into 
other end-items, without the prior written approval of the U.S. 
Department of State.
    (8) ``All provisions in this agreement which refer to the United 
States Government and the Department of State will remain binding on the 
parties after the termination of the agreement.''
    (9) Additional clause. Unless the articles covered by the agreement 
are in fact intended to be distributed to private persons or entities 
(e.g., sporting firearms for commercial resale, cryptographic devices 
and software for financial and business applications), the following 
clause must be included in all warehousing and distribution agreements: 
``Sales or other transfers of the licensed article shall be limited to 
governments of the countries in the distribution territory and to 
private entities seeking to procure the licensed article pursuant to a 
contract with a government within the distribution territory, unless the 
prior written approval of the U.S. Department of State is obtained.''
    (d) Special clauses for agreements relating to significant military 
equipment. With respect to agreements for the warehousing and 
distribution of significant military equipment, the following additional 
provisions must be included in the agreement:
    (1) A completed nontransfer and use certificate (DSP-83) must be 
executed by the foreign end-user and submitted to the U.S. Department of 
State before any transfer may take place.
    (2) The prior written approval of the U.S. Department of State must 
be obtained before entering into a commitment for the transfer of the 
licensed article by sale or otherwise to any person or government 
outside the approved distribution territory.
    (e) Transmittal Letters. Requests for approval of warehousing and 
distribution agreements with foreign persons must be made by letter. The 
original letter and seven copies of the letter and seven copies of the 
proposed agreement shall be submitted to the Office of Defense Trade 
Controls. The letter shall contain:
    (1) A statement giving the applicant's Defense Trade Controls 
registration number.
    (2) A statement identifying the foreign party to the agreement.
    (3) A statement identifying the defense articles to be distributed 
under the agreement.

[[Page 376]]

    (4) A statement identifying any U.S. Government contract under which 
the equipment may have been generated, improved, developed or supplied 
to the U.S. Government, and whether the equipment was derived from any 
bid or other proposal to the U.S. Government.
    (5) A statement that no classified defense articles or classified 
technical data are involved.
    (6) A statement identifying any patent application which discloses 
any of the subject matter of the equipment or related technical data 
covered by an invention secrecy order issued by the U.S. Patent and 
Trademark Office.
    (f) Required clauses. The following statements must be made in the 
letter of transmittal:
    (1) ``If the agreement is approved by the Department of State, such 
approval will not be construed by (applicant) as passing on the legality 
of the agreement from the standpoint of antitrust laws or other 
applicable statutes, nor will (the applicant) construe the Department's 
approval as constituting either approval or disapproval of any of the 
business terms or conditions between the parties to the agreement.''
    (2) ``The (applicant) will not permit the proposed agreement to 
enter into force until it has been approved by the Department of 
State.''
    (3) ``(Applicant) will furnish the Department of State with one copy 
of the signed agreement (or amendment thereto) within 30 days from the 
date that the agreement is concluded, and will inform the Department of 
its termination not less than 30 days prior to expiration. If a decision 
is made not to conclude the proposed agreement, (applicant) will so 
inform the Department within 60 days.''



Sec. 124.15  Arrangements for U.S. encryption (Category XIII(b)(1)) distribution by manufacturers.

    (a) Arrangements for the export of unclassified defense articles 
identified in Category XIII(b)(1) must be approved by the Office of 
Defense Trade Controls before they enter into force. Such arrangements 
will be limited to unclassified defense articles identified in Category 
XIII(b)(1) and must contain conditions for special distribution, end-use 
and reporting. Licenses for export pursuant to such arrangements must be 
obtained prior to export of the defense article unless an exemption 
under Sec. 123.16(b)(1) of this subchapter is applicable.
    (b) Required information. Proposed arrangements shall be submitted 
to the Office of Defense Trade Controls for review and approval. The 
following information must be included in all such proposed 
arrangements:
    (1) A description of the U.S. Munitions List articles involved. This 
shall include when applicable the Federal Stock Number, nameplate data, 
and any control numbers under which the articles were developed or 
procured by the U.S. Government;
    (2) A detailed statement of the terms and conditions under which the 
articles will be exported and distributed;
    (3) The duration of the proposed arrangement; and
    (4) Specific identification of the country or countries that 
comprise the distribution territory. A Nontransfer and Use Certificate 
(DSP-83) will be required in accordance with Sec. 123.10.
    (c) Required Statements. The following statements must be included 
in all arrangements:
    (1) This arrangement shall not enter into force, and shall not be 
amended or extended, without the prior written approval of the 
Department of State of the U.S. Government.
    (2) This arrangement is subject to all United States laws and 
regulations relating to exports and to all administrative acts of the 
U.S. Government pursuant to such laws and regulations.
    (3) The arrangement shall not affect the performance of any 
obligations created by prior contracts or subcontracts which the 
applicant may have individually or collectively with the U.S. 
Government.
    (4) No liability will be incurred by or attributed to the U.S. 
Government in connection with any possible infringement of privately 
owned patent or proprietary rights, either domestic or foreign, by 
reason of the U.S. Government's approval of this arrangement.
    (5) No export, sale, transfer, or other disposition of the U.S. 
Munitions List articles covered by this arrangement is authorized to any 
country outside the distribution territory without the prior

[[Page 377]]

written approval of the Office of Defense Trade Controls of the U.S. 
Department of State.
    (6) The applicant agrees that a semi-annual report of sales or other 
transfers pursuant to this arrangement of the licensed articles, by 
quantity, type, U.S. dollar value, and purchaser or recipient shall be 
provided by (applicant) to the Department of State. Such reports may 
cover calendar or fiscal years. Reporting shall continue until such time 
as all articles authorized under the arrangement or a permanent 
unclassified license (DSP-5) authorized in support of the arrangement 
have been reported. Reports shall be deemed proprietary information by 
the Department of State and will not be disclosed to unauthorized 
persons. (See Sec. 126.10(b) of this subchapter.)
    (7) The applicant agrees to notify (identify foreign end-user) of 
any end use or retransfer restrictions and (identify foreign end user) 
agrees to incorporate the following statement as an integral provision 
of a contract, invoice or other appropriate document when the articles 
covered by this arrangement are sold or otherwise transferred:
    ``These commodities are authorized for export by the U.S. Government 
only to (identify country of ultimate destination). They may not be 
resold, diverted, transferred, transshipped, or otherwise be disposed of 
in any other country, either in their original form or after being 
incorporated through an intermediate process into other end-items, 
without the prior written approval of the U.S. Department of State.''
    (8) All provisions in this arrangement which refer to the United 
States Government and the Department of State will remain binding on the 
applicant after the termination of the arrangement.
    (d) The license will be valid for four years and quantities and 
values should reflect those for this time period. No application will be 
accepted for any export for which Congressional notification is 
required.
    The application shall be filled out in accordance with the 
instructions; however, in this instance, foreign end-user, foreign 
consignee, and foreign intermediate consignees need not be identified. 
In each block state: ``The foreign person in this block will be reported 
in accordance with Sec. 124.15 of the ITAR.'' The provisions of 
Sec. 126.13(b) with regards to foreign consignee and foreign 
intermediate consignee need not be complied with at the time the 
application is transmitted but will be reported semi-annually.
    (e) Transmittal letter. Requests for approval of the arrangement 
must be made by letter. The original letter and seven copies of the 
proposed arrangement shall be submitted to the Office of Defense Trade 
Controls. The letter shall contain the following:
    (1) A statement giving the applicant's Defense Trade Controls 
registration number.
    (2) A statement identifying the country or countries to comprise the 
distribution territory.
    (3) A statement identifying the defense articles to be distributed 
under the arrangement.
    (4) A statement identifying any U.S. Government contract under which 
the equipment may have been generated, improved, developed or supplied 
to the U.S. Government, and whether the equipment was derived from any 
bid or other proposal to the U.S. Government.
    (5) A statement that no classified defense articles or classified 
technical data are involved.
    (6) A statement identifying any patent application which discloses 
any of the subject matter of the equipment or related technical data 
covered by an invention secrecy order issued by the U.S. Patent and 
Trademark Office.
    (7) A statement that the applicant will not permit any exports to 
take place until the arrangement and the export license have been 
approved by the Department of State.
[59 FR 45622, Sept. 2, 1994]



PART 125--LICENSES FOR THE EXPORT OF TECHNICAL DATA AND CLASSIFIED DEFENSE ARTICLES--Table of Contents




Sec.
125.1  Exports subject to this part.
125.2  Exports of unclassified technical data.
125.3  Exports of classified technical data and classified defense 
          articles.
125.4  Exemptions of general applicability.

[[Page 378]]

125.5  Exemptions for plant visits.
125.6  Certification requirements for exemptions.
125.7  Procedures for the export of classified technical data and other 
          classified defense articles.
125.8  Filing of licenses for exports of unclassified technical data.
125.9  Filing of licenses and other authorizations for exports of 
          classified technical data and classified defense articles.

    Authority:  Sections 2 and 38, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778); E.O. 11958, 42 FR 4311, 3 CFR, 1977 Comp. p.79; 22 
U.S.C. 2658.

    Source:  58 FR 39310, July 22, 1993, unless otherwise noted.



Sec. 125.1  Exports subject to this part.

    (a) The controls of this part apply to the export of technical data 
and the export of classified defense articles. Information which is in 
the public domain (see Sec. 120.11 of this subchapter and 
Sec. 125.4(b)(13)) is not subject to the controls of this subchapter.
    (b) A license for the export of technical data and the exemptions in 
Sec. 125.4 may not be used for foreign production purposes or for 
technical assistance unless the approval of the Office of Defense Trade 
Controls has been obtained. Such approval is generally provided only 
pursuant to the procedures specified in part 124 of this subchapter.
    (c) Technical data authorized for export may not be reexported, 
transferred or diverted from the country of ultimate end-use or from the 
authorized foreign end-user (as designated in the license or approval 
for export) or disclosed to a national of another country without the 
prior written approval of the Office of Defense Trade Controls.
    (d) The controls of this part apply to the exports referred to in 
paragraph (a) of this section regardless of whether the person who 
intends to export the technical data produces or manufactures defense 
articles if the technical data is determined by the Office of Defense 
Trade Controls to be subject to the controls of this subchapter.
    (e) The provisions of this subchapter do not apply to technical data 
related to articles in Category VI(e) and Category XVI. The export of 
such data is controlled by the Department of Energy and the Nuclear 
Regulatory Commission pursuant to the Atomic Energy Act of 1954, as 
amended, and the Nuclear Non-Proliferation Act of 1978.



Sec. 125.2  Exports of unclassified technical data.

    (a) A license (DSP-5) is required for the export of unclassified 
technical data unless the export is exempt from the licensing 
requirements of this subchapter. In the case of a plant visit, details 
of the proposed discussions must be transmitted to the Office of Defense 
Trade Controls for an appraisal of the technical data. Seven copies of 
the technical data or the details of the discussion must be provided.
    (b) Patents. A license issued by the Office of Defense Trade 
Controls is required for the export of technical data whenever the data 
exceeds that which is used to support a domestic filing of a patent 
application or to support a foreign filing of a patent application 
whenever no domestic application has been filed. Requests for the filing 
of patent applications in a foreign country, and requests for the filing 
of amendments, modifications or supplements to such patents, should 
follow the regulations of the U.S. Patent and Trademark Office in 
accordance with 37 CFR part 5. The export of technical data to support 
the filing and processing of patent applications in foreign countries is 
subject to regulations issued by the U.S. Patent and Trademark Office 
pursuant to 35 U.S.C. 184.
    (c) Disclosures. Unless otherwise expressly exempted in this 
subchapter, a license is required for the oral, visual or documentary 
disclosure of technical data by U.S. persons to foreign persons. A 
license is required regardless of the manner in which the technical data 
is transmitted (e.g., in person, by telephone, correspondence, 
electronic means, etc.). A license is required for such disclosures by 
U.S. persons in connection with visits to foreign diplomatic missions 
and consular offices.



Sec. 125.3  Exports of classified technical data and classified defense articles.

    (a) A request for authority to export defense articles, including 
technical data, classified by a foreign government or pursuant to 
Executive Order 12356, successor orders, or other legal

[[Page 379]]

authority must be submitted to the Office of Defense Trade Controls for 
approval. The application must contain full details of the proposed 
transaction. It should also list the facility security clearance code of 
all U.S. parties on the license and include the Defense Investigative 
Service cognizant security office of the party responsible for packaging 
the commodity for shipment. A nontransfer and use certificate (Form DSP-
83) executed by the applicant, foreign consignee, end-user and an 
authorized representative of the foreign government involved will be 
required.
    (b) Classified technical data which is approved by the Office of 
Defense Trade Controls either for export or reexport after a temporary 
import will be transferred or disclosed only in accordance with the 
requirements in the Department of Defense Industrial Security Manual. 
Any other requirements imposed by cognizant U.S. departments and 
agencies must also be satisfied.
    (c) The approval of the Office of Defense Trade Controls must be 
obtained for the export of technical data by a U.S. person to a foreign 
person in the U.S. or in a foreign country unless the proposed export is 
exempt under the provisions of this subchapter.
    (d) All communications relating to a patent application covered by 
an invention secrecy order are to be addressed to the U.S. Patent and 
Trademark Office (see 37 CFR 5.11).



Sec. 125.4  Exemptions of general applicability.

    (a) The following exemptions apply to exports of unclassified 
technical data for which approval is not needed from the Office of 
Defense Trade Controls. These exemptions, except for paragraph (b)(13) 
of this section, do not apply to exports to proscribed destinations 
under Sec. 126.1 of this subchapter or for persons considered generally 
ineligible under Sec. 120.1(c) of this subchapter. The exemptions are 
also not applicable for purposes of establishing offshore procurement 
arrangements. If Sec. 126.8 of this subchapter requirements are 
applicable, they must be met before an exemption under this section may 
be used. Transmission of classified information must comply with the 
requirements of the Department of Defense Industrial Security Manual and 
the exporter must certify to the transmittal authority that the 
technical data does not exceed the technical limitation of the 
authorized export.
    (b) The following exports are exempt from the licensing requirements 
of this subchapter.
    (1) Technical data, including classified information, to be 
disclosed pursuant to an official written request or directive from the 
U.S. Department of Defense;
    (2) Technical data, including classified information, in furtherance 
of a manufacturing license or technical assistance agreement approved by 
the Department of State under part 124 of this subchapter and which meet 
the requirements of Sec. 124.3 of this subchapter;
    (3) Technical data, including classified information, in furtherance 
of a contract between the exporter and an agency of the U.S. Government, 
if the contract provides for the export of the data and such data does 
not disclose the details of design, development, production, or 
manufacture of any defense article;
    (4) Copies of technical data, including classified information, 
previously authorized for export to the same recipient. Revised copies 
of such technical data are also exempt if they pertain to the identical 
defense article, and if the revisions are solely editorial and do not 
add to the content of technology previously exported or authorized for 
export to the same recipient;
    (5) Technical data, including classified information, in the form of 
basic operations, maintenance, and training information relating to a 
defense article lawfully exported or authorized for export to the same 
recipient. Intermediate or depot-level repair and maintenance 
information may be exported only under a license or agreement approved 
specifically for that purpose;
    (6) Technical data, including classified information, related to 
firearms not in excess of caliber .50 and ammunition for such weapons, 
except detailed design, development, production or manufacturing 
information;
    (7) Technical data, including classified information, being returned 
to the original source of import;

[[Page 380]]

    (8) Technical data directly related to classified information which 
has been previously exported or authorized for export in accordance with 
this part to the same recipient, and which does not disclose the details 
of the design, development, production, or manufacture of any defense 
article;
    (9) Technical data, including classified information, sent by a U.S. 
corporation to a U.S. person employed by that corporation overseas or to 
a U.S. Government agency. This exemption is subject to the limitations 
of Sec. 125.1(b) and may be used only if:
    (i) The technical data is to be used overseas solely by U.S. 
persons;
    (ii) If the U.S. person overseas is an employee of the U.S. 
Government or is directly employed by the U.S. corporation and not by a 
foreign subsidiary; and
    (iii) The classified information is sent overseas in accordance with 
the requirements of the Department of Defense Industrial Security 
Manual.
    (10) Disclosures of unclassified technical data in the U.S. by U.S. 
institutions of higher learning to foreign persons who are their bona 
fide and full time regular employees. This exemption is available only 
if:
    (i) The employee's permanent abode throughout the period of 
employment is in the United States;
    (ii) The employee is not a national of a country to which exports 
are prohibited pursuant to Sec. 126.1 of this subchapter; and
    (iii) The institution informs the individual in writing that the 
technical data may not be transferred to other foreign persons without 
the prior written approval of the Office of Defense Trade Controls;
    (11) Technical data, including classified information, for which the 
exporter, pursuant to an arrangement with the Department of Defense, 
Department of Energy or NASA which requires such exports, has been 
granted an exemption in writing from the licensing provisions of this 
part by the Office of Defense Trade Controls. Such an exemption will 
normally be granted only if the arrangement directly implements an 
international agreement to which the United States is a party and if 
multiple exports are contemplated. The Office of Defense Trade Controls, 
in consultation with the relevant U.S. Government agencies, will 
determine whether the interests of the United States Government are best 
served by expediting exports under an arrangement through an exemption 
(see also paragraph (b)(3) of this section for a related exemption);
    (12) Technical data which is specifically exempt under part 126 of 
this subchapter; or
    (13) Technical data approved for public release (i.e., unlimited 
distribution) by the cognizant U.S. Government department or agency or 
Directorate for Freedom of Information and Security Review. This 
exemption is applicable to information approved by the cognizant U.S. 
Government department or agency for public release in any form. It does 
not require that the information be published in order to qualify for 
the exemption.



Sec. 125.5  Exemptions for plant visits.

    (a) A license is not required for the oral and visual disclosure of 
unclassified technical data during the course of a classified plant 
visit by a foreign person, provided (1) the classified visit has itself 
been authorized pursuant to a license issued by the Office of Defense 
Trade Controls; or (2) the classified visit was approved in connection 
with an actual or potential government-to-government program or project 
by a U.S. Government agency having classification jurisdiction over the 
classified defense article or classified technical data involved under 
Executive Order 12356 or other applicable Executive Order; and (3) the 
unclassified information to be released is directly related to the 
classified defense article or technical data for which approval was 
obtained and does not disclose the details of the design, development, 
production or manufacture of any other defense articles. In the case of 
visits involving classified information, the requirements of the Defense 
Industrial Security Manual (Department of Defense Manual 5220.22M) must 
be met.
    (b) The approval of the Office of Defense Trade Controls is not 
required for the disclosure of oral and visual classified information to 
a foreign person

[[Page 381]]

during the course of a plant visit approved by the appropriate U.S. 
Government agency if (1) the requirements of the Defense Industrial 
Security Manual have been met, (2) the classified information is 
directly related to that which was approved by the U.S. Government 
agency, (3) it does not exceed that for which approval was obtained, and 
(4) it does not disclose the details of the design, development, 
production or manufacture of any defense articles.
    (c) A license is not required for the disclosure to a foreign person 
of unclassified technical data during the course of a plant visit 
(either classified or unclassified) approved by the Office of Defense 
Trade Controls or a cognizant U.S. Government agency provided the 
technical data does not contain information in excess of that approved 
for disclosure. This exemption does not apply to technical data which 
could be used for design, development, production or manufacture of a 
defense article.



Sec. 125.6  Certification requirements for exemptions.

    (a) To claim an exemption for the export of technical data under the 
provisions of Secs. 125.4 and 125.5, an exporter must certify that the 
proposed export is covered by a relevant paragraph of that section. For 
Sec. 125.4, certification consists of marking the package or letter 
containing the technical data: ``22 CFR 125.4 (identify subsection) 
applicable.'' This certification must be made in written form and 
retained in the exporter's files for a period of five years. A Shippers 
Export Declaration is not required for exports of unclassified technical 
data (see Sec. 123.22 (d) of this subchapter.
    (b) If a District Director of Customs or Postmaster is unavailable 
at the time of export, or if the export is via oral, visual, or 
electronic means, the exporter must also complete a written 
certification as indicated in paragraph (a) of this section.



Sec. 125.7  Procedures for the export of classified technical data and other classified defense articles.

    (a) All applications for the export or temporary import of 
classified technical data or other classified defense articles must be 
submitted to the Office of Defense Trade Controls on Form DSP-85.
    (b) An application for the export of classified technical data or 
other classified defense articles must be accompanied by seven copies of 
the data and a completed Form DSP-83 (see Sec. 123.10 of this 
subchapter). Only one copy of the data or descriptive literature must be 
provided if a renewal of the license is requested. All classified 
materials accompanying an application must be transmitted to the Office 
of Defense Trade Controls in accordance with the requirements of the 
Defense Industrial Security Manual (Department of Defense Manual Number 
5220.22-M).



Sec. 125.8  Filing of licenses for exports of unclassified technical data.

    (a) Licenses for the export of unclassified technical data must be 
presented to the appropriate District Director of Customs or Postmaster 
at the time of shipment or mailing. The District Director of Customs or 
Postmaster will endorse and transmit the licenses to the Office of 
Defense Trade Controls in accordance with the instructions contained on 
the reverse side of the license.
    (b) If a license for the export of unclassified technical data is 
used but not endorsed by U.S. Customs or a Postmaster for whatever 
reason (e.g., electronic transmission, unavailability of Customs officer 
or Postmaster, etc.), the person exporting the data must self-endorse 
the license, showing when and how the export took place. Every license 
must be returned to the Office of Defense Trade Controls when the total 
value authorized has been shipped or when the date of expiration has 
been reached, whichever occurs first.



Sec. 125.9  Filing of licenses and other authorizations for exports of classified technical data and classified defense articles.

    Licenses and other authorizations for the export of classified 
technical data or classified defense articles will be forwarded by the 
Office of Defense Trade Controls to the Defense Investigative Service of 
the Department of

[[Page 382]]

Defense in accordance with the provisions of the Department of Defense 
Industrial Security Manual. The Office of Defense Trade Controls will 
forward a copy of the license to the applicant for the applicant's 
information. The Defense Investigative Service will return the endorsed 
license to the Office of Defense Trade Controls upon completion of the 
authorized export or expiration of the license, whichever occurs first.



PART 126--GENERAL POLICIES AND PROVISIONS--Table of Contents




Sec.
126.1  Prohibited exports and sales to certain countries.
126.2  Temporary suspension or modification of this subchapter.
126.3  Exceptions.
126.4  Shipments by or for United States Government agencies.
126.5  Canadian exemptions.
126.6  Foreign-owned military aircraft and naval vessels, and the 
          Foreign Military Sales program.
126.7  Denial, revocation, suspension or amendment of licenses and other 
          approvals.
126.8  Proposals to foreign persons relating to significant military 
          equipment.
126.9  Advisory opinions.
126.10  Disclosure of information.
126.11  Relation to other provisions of law.
126.12  Continuation in force.
126.13  Required information.

    Authority:  Secs. 2, 38, 40, 42, and 71, Pub. L. 90-629, 90 Stat. 
744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); 22 U.S.C. 2778; E.O. 
11958, 42 FR 4311; 3 CFR, 1977 Comp., p. 79; 22 U.S.C. 2658; 22 U.S.C. 
287c; E.O. 12918, 59 FR 28205, 3 CFR, 1994 Comp., p. 899.

    Source:  58 FR 39312, July 22, 1993, unless otherwise noted.



Sec. 126.1  Prohibited exports and sales to certain countries.

    (a) General. It is the policy of the United States to deny licenses, 
other approvals, exports and imports of defense articles and defense 
services, destined for or originating in certain countries. This policy 
applies to Afghanistan, Armenia, Azerbaijan, Belarus, Cuba, Iran, Iraq, 
Libya, North Korea, Syria, Tajikistan, Ukraine, and Vietnam. This policy 
also applies to countries with respect to which the United States 
maintains an arms embargo (e.g. Burma, China, the Federal Republic of 
Yugoslavia (Serbia and Montenegro), Haiti, Liberia, Rwanda, Somalia, 
Sudan and Zaire) or whenever an export would not otherwise be in 
furtherance of world peace and the security and foreign policy of the 
United States. Comprehensive arms embargoes are normally the subject of 
a State Department notice published in the Federal Register. The 
exemptions provided in the regulations in this subchapter, except 
Secs. 123.17 and 125.4(b)(13) of this subchapter, do not apply with 
respect to articles originating in or for export to any proscribed 
countries or areas. With regard to Sec. 123.27 the exemption does not 
apply with respect to articles originating in or for export to countries 
prohibited by a United Nations Security Council Resolution or to which 
the export (or for which the issuance of a license for the export) would 
be prohibited by a U.S. statute (e.g. by Section 40 of the Arms Export 
Control Act, 22 U.S.C. 2780, to countries that have been determined to 
have repeatedly provided support for acts of international terrorism, 
i.e., Cuba, Iran, Iraq, Libya, North Korea, Sudan and Syria).
    (b) Shipments. A defense article licensed for export under this 
subchapter may not be shipped on a vessel, aircraft or other means of 
conveyance which is owned or operated by, or leased to or from, any of 
the proscribed countries or areas.
    (c) Exports and sales prohibited by United Nations Security Council 
embargoes. Whenever the United Nations Security Council mandates an arms 
embargo, all transactions which are prohibited by the embargo and which 
involve U.S. persons anywhere, or any person in the United States, and 
defense articles and services of a type enumerated on the United States 
Munitions List (22 CFR part 121), irrespective of origin, are prohibited 
under the ITAR for the duration of the embargo, unless the Department of 
State publishes a notice in the Federal Register specifying different 
measures. This would include, but is not limited to, transactions 
involving trade by U.S. persons who are located inside or outside of the 
United States in defense articles and services of U.S. or foreign

[[Page 383]]

origin which are located inside or outside of the United States.
    (d) Terrorism. Exports to countries which the Secretary of State has 
determined to have repeatedly provided support for act of international 
terrorism are contrary to the foreign policy of the United States and 
are thus subject to the policy specified in paragraph (a) of this 
section and the requirements of section 40 of the Arms Export Control 
Act (22 U.S.C. 2780) and the Omnibus Diplomatic Security and Anti-
Terrorism Act of 1986 (22 U.S.C. 4801, note). The countries in this 
category are: Cuba, Iran, Iraq, Libya, North Korea, Sudan and Syria. The 
same countries are identified pursuant to section 6(j) of the Export 
Administration Act, as amended (50 U.S.C. App. 2405(j)).
    (e) Proposed sales. No sale or transfer and no proposal to sell or 
transfer any defense articles, defense services or technical data 
subject to this subchapter may be made to any country referred to in 
this section (including the embassies or consulates of such a country), 
or to any person acting on its behalf, whether in the United States or 
abroad, without first obtaining a license or written approval of the 
Office of Defense Trade Controls. However, in accordance with paragraph 
(a) of this section, it is the policy of the Department of State to deny 
licenses and approvals in such cases. Any person who knows or has reason 
to know of such a proposed or actual sale, or transfer, of such 
articles, services or data must immediately inform the Office of Defense 
Trade Controls.
    (f) Angola. Consistent with U.N. Security Council Resolution 864 of 
September 15, 1993, an arms embargo exists with respect to UNITA. 
Accordingly, exports subject to this subchapter are prohibited in 
accordance with Security Council Resolution 864, Executive Order 12865 
of September 29, 1993, and the UNITA (Angola) Sanctions Regulations 
issued by the Office of Foreign Assets Control, Department of the 
Treasury, on December 10, 1993 (58 FR 64904).
[58 FR 39312, July 22, 1993, as amended at 59 FR 15625, Apr. 4, 1994; 59 
FR 42158, Aug. 17, 1994; 61 FR 6113, Feb. 16, 1996; 61 FR 36625, July 
12, 1996; 61 FR 41499, Aug. 9, 1996; 62 FR 37133, July 11, 1997]



Sec. 126.2  Temporary suspension or modification of this subchapter.

    The Director, Office of Defense Trade Controls, may order the 
temporary suspension or modification of any or all of the regulations of 
this subchapter in the interest of the security and foreign policy of 
the United States.



Sec. 126.3  Exceptions.

    In a case of exceptional or undue hardship, or when it is otherwise 
in the interest of the United States Government, the Director, Office of 
Defense Trade Controls may make an exception to the provisions of this 
subchapter.



Sec. 126.4  Shipments by or for United States Government agencies.

    (a) A license is not required for the temporary import, or temporary 
export, of any defense article, including technical data or the 
performance of a defense service, by or for any agency of the U.S. 
Government (1) for official use by such an agency, or (2) for carrying 
out any foreign assistance, cooperative project or sales program 
authorized by law and subject to control by the President by other 
means. This exemption applies only when all aspects of a transaction 
(export, carriage, and delivery abroad) are effected by a United States 
Government agency or when the export is covered by a United States 
Government Bill of Lading. This exemption, however, does not apply when 
a U.S. Government agency acts as a transmittal agent on behalf of a 
private individual or firm, either as a convenience or in satisfaction 
of security requirements. The approval of the Office of Defense Trade 
Controls must be obtained before defense articles previously exported 
pursuant to this exemption are permanently transferred (e.g., property 
disposal of surplus defense articles overseas) unless (i) the transfer 
is pursuant to a grant, sale, lease, loan or cooperative project under 
the Arms Export Control Act or a sale, lease or loan under the Foreign 
Assistance Act of 1961, as amended, or (ii) the defense articles have 
been rendered useless for military purposes beyond the possibility of 
restoration.

    Note: Special definition. For purposes of this section, defense 
articles exported abroad

[[Page 384]]

for incorporation into a foreign launch vehicle or for use on a foreign 
launch vehicle or satellite that is to be launched from a foreign 
country shall be considered a permanent export.

    (b) This section does not authorize any department or agency of the 
U.S. Government to make any export which is otherwise prohibited by 
virtue of other administrative provisions or by any statute.
    (c) A license is not required for the temporary import, or temporary 
or permanent export, of any classified or unclassified defense articles, 
including technical data or the performance of a defense service, for 
end-use by a U.S. Government Agency in a foreign country under the 
following circumstances:
    (1) The export or temporary import is pursuant to a contract with, 
or written direction by, an agency of the U.S. Government; and
    (2) The end-user in the foreign country is a U.S. Government agency 
or facility, and the defense articles or technical data will not be 
transferred to any foreign person; and
    (3) The urgency of the U.S. Government requirement is such that the 
appropriate export license or U.S. Government Bill of Lading could not 
have been obtained in a timely manner.
    (d) A Shipper's Export Declaration (SED), required under 
Sec. 123.22(c) of this subchapter, and a written statement by the 
exporter certifying that these requirements have been met must be 
presented at the time of export to the appropriate District Director of 
Customs or Department of Defense transmittal authority. A copy of the 
SED and the written certification statement shall be provided to the 
Office of Defense Trade Controls immediately following the export.



Sec. 126.5  Canadian exemptions.

    (a) District Directors of Customs and postmasters shall permit the 
permanent or temporary export or temporary import without a license of 
any unclassified equipment or unclassified technical data to Canada for 
end use in Canada by Canadian citizens or return to the United States, 
or from Canada for end use in the United States or return to a Canadian 
citizen in Canada, with the exception of the defense articles, defense 
services or related technical data.
    (b) Exceptions. The exemptions of this section do not apply to the 
following defense articles, defense services, or related technical data:
    (1) Fully automatic firearms and components and parts therefor in 
Category I(a) which are not for end use by the Federal Government, or a 
Provincial or Municipal Government of Canada;
    (2) Nuclear weapons strategic delivery systems and all components, 
parts, accessories, attachments specifically designed for such systems 
and associated equipment;
    (3) Nuclear weapon design and test equipment listed in Category XVI;
    (4) Naval nuclear propulsion equipment listed in Category VI(e);
    (5) Aircraft listed in Category VIII(a);
    (6) Submersible and oceanographic vessels and related articles 
listed in Category XX (a) through (d).
    (7) Defense articles, defense services, or related technical data 
for use by a foreign national other than a Canadian.
    (c) Related requirements. The foregoing exemption from obtaining an 
export license does not exempt an exporter from complying with the 
requirements set forth in Sec. 123.15 of this subchapter or from filing 
the Shipper's Export Declaration or notification letter required by 
Sec. 123.22 of this subchapter.
    (d) Part 124 agreements. The requirements of part 124 of this 
subchapter must be complied with in the situations contemplated in that 
part. For example, the exemptions of this section may not be used for 
the provision of defense services except pursuant to an approved 
manufacturing license agreement or technical assistance agreement.
[59 FR 29951, June 10, 1994]



Sec. 126.6  Foreign-owned military aircraft and naval vessels, and the Foreign Military Sales program.

    (a) A license from the Office of Defense Trade Controls is not 
required if:
    (1)(i) The article or technical data to be exported was sold, 
leased, or loaned

[[Page 385]]

by the Department of Defense to a foreign country or international 
organization pursuant to the Arms Export Control Act or the Foreign 
Assistance Act of 1961, as amended, and
    (ii) The article or technical data was delivered to representatives 
of such a country or organization in the United States; and
    (iii) The article or technical data is to be exported from the 
United States on a military aircraft or naval vessel of that government 
or organization or via the Defense Transportation Service (DTS).
    (b) Foreign military aircraft and naval vessels. A license is not 
required for the entry into the United States of military aircraft or 
naval vessels of any foreign state if no overhaul, repair, or 
modification of the aircraft or naval vessel is to be performed. 
However, Department of State approval for overflight (pursuant to the 49 
U.S.C. 1508) and naval visits must be obtained from the Bureau of 
Politico-Military Affairs, Office of International Security Operations.
    (c) Procedures for the Foreign Military Sales Program. (1) District 
Directors of Customs are authorized to permit the export and temporary 
import of classified and unclassified defense articles, defense services 
and technical data without a license if the articles or technical data 
were sold, leased or loaned by the U.S. Department of Defense to foreign 
governments or international organizations under the Foreign Military 
Sales (FMS) program of the Arms Export Control Act. This procedure may 
be used only if a proposed export is:
    (i) Pursuant to an executed U.S. Department of Defense Letter of 
Offer and Acceptance (DD Form 1513); and
    (ii) Accompanied by a properly executed DSP-94, or in the case of a 
classified shipment, an approved Letter of Offer and Acceptance; and
    (iii) Made by the relevant foreign diplomatic mission of the 
purchasing country or its authorized freight forwarder, provided that 
the freight forwarder is registered with the Office of Defense Trade 
Controls pursuant to part 122 of this subchapter, and, if classified 
defense articles or technical data are involved, has the requisite U.S. 
Government security clearance and a transportation plan has been 
approved as in Sec. 126.6(a)(1), above and the defense articles or 
technical data are shipped in compliance with the Department of Defense 
Industrial Security Manual.
    (2) Filing and documents.
    (i) The original copy of completed Form DSP-94, together with one 
copy of the corresponding authenticated DD Form 1513 and a Shipper's 
Export Declaration, must be filed with the District Director of Customs 
at the port of exit prior to actual shipment. An executed DD Form 1513 
is one which has been signed by:
    (A) an authorized Department of Defense representative and 
countersigned by the Comptroller, Defense Security Assistance Agency 
(DSAA); and
    (B) by an authorized representative of the foreign government.
    (ii) SED or Outbound Manifest. The Shipper's Export Declaration or, 
if authorized, the outbound manifest, must be annotated as follows:

    This shipment is being exported under the authority of Department of 
State Form DSP-94. It covers FMS Case (case identification), expiration 
date ____________. 22 CFR 126.6 applicable. The U.S. Government point of 
contact is ____________, telephone number ____________.



Sec. 126.7  Denial, revocation, suspension or amendment of licenses and other approvals.

    (a) Policy. Licenses or approvals shall be denied or revoked 
whenever required by any statute of the United States (see Secs. 127.6 
and 127.10 of this subchapter). Any application for an export license or 
other approval under this subchapter may be disapproved, and any license 
or other approval or exemption granted under this subchapter may be 
revoked, suspended, or amended without prior notice whenever:
    (1) The Department of State deems such action to be in furtherance 
of world peace, the national security or the foreign policy of the 
United States, or is otherwise advisable; or
    (2) The Department of State believes that 22 U.S.C. 2778, any 
regulation contained in this subchapter, or the terms

[[Page 386]]

of any U.S. Government export authorization (including the terms of a 
manufacturing license or technical assistance agreement, or export 
authorization granted pursuant to the Export Administration Act, as 
amended) has been violated by any party to the export or other person 
having significant interest in the transaction; or
    (3) An applicant is the subject of an indictment for a violation of 
any of the U.S. criminal statutes enumerated in Sec. 120.27 of this 
subchapter; or
    (4) An applicant or any party to the export or the agreement has 
been convicted of violating any of the U.S. criminal statutes enumerated 
in Sec. 120.27 of this subchapter; or
    (5) An applicant is ineligible to contract with, or to receive a 
license or other authorization to import defense articles or defense 
services from, any agency of the U.S. Government; or
    (6) An applicant, any party to the export or agreement, any source 
or manufacturer of the defense article or defense service or any person 
who has a significant interest in the transaction has been debarred, 
suspended, or otherwise is ineligible to receive an export license or 
other authorization from any agency of the U.S. government (e.g., 
pursuant to debarment by the Department of Commerce under 15 CFR part 
388 or by the Department of State under part 127 or 128 of this 
subchapter); or
    (7) An applicant has failed to include any of the information or 
documentation expressly required to support a license application or 
other request for approval under this subchapter or as required in the 
instructions in the applicable Department of State form; or
    (8) An applicant is subject to sanctions under other relevant U.S. 
laws (e.g., the Missile Technology Controls title of the National 
Defense Authorization Act for FY 1991 (Pub. L. 101-510); the Chemical 
and Biological Weapons Control and Warfare Elimination Act of 1991 (Pub. 
L. 102-182); or the Iran-Iraq Arms Non-Proliferation Act of 1992 (Pub. 
L. 102-484)).
    (b) Notification. The Office of Defense Trade Controls will notify 
applicants or licensees or other appropriate United States persons of 
actions taken pursuant to paragraph (a) of this section. The reasons for 
the action will be stated as specifically as security and foreign policy 
considerations permit.
    (c) Reconsideration. If a written request for reconsideration of an 
adverse decision is made within 30 days after a person has been informed 
of the decision, the U.S. person will be accorded an opportunity to 
present additional information. The case will then be reviewed by the 
Office of Defense Trade Controls.
    (d) Reconsideration of certain applications. Applications for 
licenses or other requests for approval denied for repeated failure to 
provide information or documentation expressly required will normally 
not be reconsidered during the thirty day period following denial. They 
will be reconsidered after this period only after a final decision is 
made on whether the applicant will be subject to an administrative 
penalty imposed pursuant to this subchapter. Any request for 
reconsideration shall be accompanied by a letter explaining the steps 
that have been taken to correct the failure and to ensure compliance 
with the requirements of this subchapter.
    (e) Special definition. For purposes of this section, the term party 
to the export means:
    (1) The chief executive officer, president, vice-presidents, other 
senior officers and officials (e.g., comptroller, treasurer, general 
counsel) and any member of the board of directors of the applicant;
    (2) The freight forwarders or designated exporting agent of the 
applicant; and
    (3) Any consignee or end-user of any item to be exported.



Sec. 126.8  Proposals to foreign persons relating to significant military equipment.

    (a) Certain proposals to foreign persons for the sale or manufacture 
abroad of significant military equipment require either the prior 
approval of, or prior notification to, the Office of Defense Trade 
Controls.
    (1) Sale of significant military equipment: Prior approval 
requirement. The approval of the Office of Defense Trade

[[Page 387]]

Controls is required before a U.S. person may make a proposal or 
presentation designed to constitute a basis for a decision on the part 
of any foreign person to purchase significant military equipment on the 
U.S. Munitions List whenever all the following conditions are met:
    (i) The value of the significant military equipment to be sold is 
$14,000,000 or more; and
    (ii) The equipment is intended for use by the armed forces of any 
foreign country other than a member of the North Atlantic Treaty 
Organization, Australia, New Zealand, or Japan; and
    (iii) The sale would involve the export from the United States of 
any defense article or the furnishing abroad of any defense service 
including technical data; and
    (iv) The identical significant military equipment has not been 
previously licensed for permanent export or approved for sale under the 
Foreign Military Sales Program of the Department of Defense, to any 
foreign country.
    (2) Sale of significant military equipment: Prior notification 
requirement. The Office Defense Trade Controls must be notified in 
writing at least thirty days in advance of any proposal or presentation 
concerning the sale of significant military equipment whenever the 
conditions specified in paragraphs (a)(1) (i) through (iii) of this 
section are met and the identical equipment has been previously licensed 
for permanent export or approved for sale under the FMS Program to any 
foreign country.
    (3) Manufacture abroad of significant military equipment: Prior 
approval requirement. The approval of the Office of Defense Trade 
Controls is required before a U.S. person may make a proposal or 
presentation designed to constitute a basis for a decision on the part 
of any foreign person to enter into any manufacturing license agreement 
or technical assistance agreement for the production or assembly of 
significant military equipment, regardless of dollar value, in any 
foreign country, whenever:
    (i) The equipment is intended for use by the armed forces of any 
foreign country; and
    (ii) The agreement would involve the export from the United States 
of any defense article or the furnishing abroad of any defense service 
including technical data.
    (b) Definition of proposal or presentation. The terms proposal or 
presentation (designed to constitute a basis for a decision to purchase 
and to enter into any agreement) mean the communication of information 
in sufficient detail that the person communicating that information 
knows or should know that it would permit an intended purchaser to 
decide either to acquire the particular equipment in question or to 
enter into the manufacturing license agreement or technical assistance 
agreement. For example, a presentation which describes the equipment's 
performance characteristics, price, and probable availability for 
delivery would require prior notification or approval, as appropriate, 
where the conditions specified in paragraph (a) of this section are met. 
By contrast, the following would not require prior notification or 
approval: Advertising or other reporting in a publication of general 
circulation; preliminary discussions to ascertain market potential; or 
merely calling attention to the fact that a company manufactures a 
particular item of significant military equipment.
    (c) Satisfaction of requirements. (1) The requirement of this 
section for prior approval is met by any of the following:
    (i) A written statement from the Office of Defense Trade Controls 
approving the proposed sale or agreement or approving the making of a 
proposal or presentation.
    (ii) A license issued under Sec. 125.2 or Sec. 125.3 of this 
subchapter for the export of technical data relating to the proposed 
sale or agreement to the country concerned.
    (iii) A temporary export license issued under Sec. 123.5 of this 
subchapter relating to the proposed sale or agreement for a 
demonstration to the armed forces of the country of export.
    (iv) With respect to manufacturing license agreements or technical 
assistance agreements, the application for export licenses pursuant to 
the two preceding subparagraphs must state

[[Page 388]]

that they are related to possible agreements of this kind.
    (2) The requirement of this section for prior notification is met by 
informing the Office of Defense Trade Controls by letter at least 30 
days before making the proposal or presentation. The letter must comply 
with the procedures set forth in paragraph (d) of this section and must 
identify the relevant license, approval, or FMS case by which the 
identical equipment had previously been authorized for permanent export 
or sale. The Office of Defense Trade Controls will provide written 
acknowledgement of such prior notification to confirm compliance with 
this requirement and the commencement of the 30-day notification period.
    (d) Procedures. Unless a license has been obtained pursuant to 
Sec. 126.8(c)(1) (ii) or (iii), a request for prior approval to make a 
proposal or presentation with respect to significant military equipment, 
or a 30-day prior notification regarding the sale of such equipment, 
must be made by letter to the Office of Defense Trade Controls. The 
letter must outline in detail the intended transaction, including usage 
of the equipment involved and the country (or countries) involved. Seven 
copies of the letter should be provided as well as seven copies of 
suitable descriptive information concerning the equipment.
    (e) Statement to accompany licensing requests. (1) Every application 
for an export license or other approval to implement a sale or agreement 
which meets the criteria specified in paragraph (a) of this section must 
be accompanied by a statement from the applicant which either:
    (i) Refers to a specific notification made or approval previously 
granted with respect to the transaction; or
    (ii) Certifies that no proposal or presentation requiring prior 
notification or approval has been made.
    (2) The Department of State may require a similar statement from the 
Foreign Military Sales contractor concerned in any case where the United 
States Government receives a request for a letter of offer for a sale 
which meets the criteria specified in paragraph (a) of this section.
    (f) Penalties. In addition to other remedies and penalties 
prescribed by law or this subchapter, a failure to satisfy the prior 
approval or prior notification requirements of this section may be 
considered to be a reason for disapproval of a license, agreement or 
sale under the FMS program.
    (g) License for technical data. Nothing in this section constitutes 
or is to be construed as an exemption from the licensing requirement for 
the export of technical data that is embodied in any proposal or 
presentation made to any foreign persons.



Sec. 126.9  Advisory opinions.

    Any person desiring information as to whether the Office of Defense 
Trade Controls would be likely to grant a license or other approval for 
the export of a particular defense article or defense service to a 
particular country may request an advisory opinion from the Office of 
Defense Trade Controls. These opinions are not binding on the Department 
of State and are revocable. A request for an advisory opinion must be 
made in writing and must outline in detail the equipment, its usage, the 
security classification (if any) of the articles or related technical 
data, and the country or countries involved. An original and seven 
copies of the letter must be provided along with seven copies of 
suitable descriptive information concerning the defense article or 
defense service.



Sec. 126.10  Disclosure of information.

    (a) Freedom of Information. Subchapter R of this title contains 
regulations on the availability to the public of information and records 
of the Department of State. The provisions of subchapter R apply to such 
disclosures by the Office of Defense Trade Controls.
    (b) Determinations required by law. Section 38(e) of the Arms Export 
Control Act (22 U.S.C. 2778) provides by reference to certain procedures 
of the Export Administrative Act that certain information required by 
the Department of State in connection with the licensing process may 
generally not be disclosed to the public unless certain determinations 
relating to the national interest are made in accordance with

[[Page 389]]

the procedures specified in that provision, except that the names of the 
countries and the types and quantities of defense articles for which 
licenses are issued under this section shall not be withheld from public 
disclosure unless the President determines that release of such 
information would be contrary to the national interest. Determinations 
required by section 38(e) shall be made by the Assistant Secretary for 
Political-Military Affairs.
    (c) Information required under part 130. Part 130 of this subchapter 
contains specific provisions on the disclosure of information described 
in that part.
    (d) National Interest Determinations. In accordance with section 
38(e) of the Arms Export Control Act (22 U.S.C. 2778(e)), the Secretary 
of State has determined that the following disclosures are in the 
national interest of the United States:
    (1) Furnishing information to foreign governments for law 
enforcement or regulatory purposes; and
    (2) Furnishing information to foreign governments and other agencies 
of the U.S. Government in the context of multilateral or bilateral 
export regimes (e.g., the Missile Technology Control Regime, the 
Australia Group, and CoCoM).
[58 FR 39312, July 22, 1993, as amended at 62 FR 67276, Dec. 24, 1997]



Sec. 126.11  Relations to other provisions of law.

    The provisions in this subchapter are in addition to, and are not in 
lieu of, any other provisions of law or regulations. The sale of 
firearms in the United States, for example, remains subject to the 
provisions of the Gun Control Act of 1968 and regulations administered 
by the Department of the Treasury. The performance of defense services 
on behalf of foreign governments by retired military personnel continues 
to require consent pursuant to Part 3a of this title. Persons who intend 
to export defense articles or furnish defense services should 
consequently not assume that satisfying the requirements of this 
subchapter relieves one of other requirements of law.



Sec. 126.12  Continuation in force.

    All determinations, authorizations, licenses, approvals of contracts 
and agreements and other action issued, authorized, undertaken, or 
entered into by the Department of State pursuant to section 414 of the 
Mutual Security Act of 1954, as amended, or under the previous 
provisions of this subchapter, continue in full force and effect until 
or unless modified, revoked or superseded by the Department of State.



Sec. 126.13  Required information.

    (a) All applications for licenses (DSP-5, DSP-61, DSP-73, and DSP-
85), all requests for approval of agreements and amendments thereto 
under part 124 of this subchapter, all requests for other written 
authorizations, and all 30-day prior notifications of sales of 
significant military equipment under Sec. 126.8(c) must include a letter 
signed by a responsible official empowered by the applicant and 
addressed to the Director, Office of Defense Trade Controls, stating 
whether:
    (1) The applicant or the chief executive officer, president, vice-
presidents, other senior officers or officials (e.g., comptroller, 
treasurer, general counsel) or any member of the board of directors is 
the subject of an indictment for or has been convicted of violating any 
of the U.S. criminal statutes enumerated in Sec. 120.27 of this 
subchapter since the effective date of the Arms Export Control Act, 
Public Law 94-329, 90 Stat. 729 (June 30, 1976);
    (2) The applicant or the chief executive officer, president, vice-
presidents, other senior officers or officials (e.g., comptroller, 
treasurer, general counsel) or any member of the board of directors is 
ineligible to contract with, or to receive a license or other approval 
to import defense articles or defense services from, or to receive an 
export license or other approval from, any agency of the U.S. 
Government;
    (3) To the best of the applicant's knowledge, any party to the 
export as defined in Sec. 126.7(e) has been convicted of violating any 
of the U.S. criminal statutes enumerated in Sec. 120.27 of this 
subchapter since the effective date of the Arms Export Control Act, 
Public Law 94-329, 90 Stat. 729 (June 30, 1976), or is ineligible to 
contract with, or to

[[Page 390]]

receive a license or other approval to import defense articles or 
defense services from, or to receive an export license or other approval 
from any agency of the U.S. government; and
    (4) The natural person signing the application, notification or 
other request for approval (including the statement required by this 
subsection) is a citizen or national of the United States, has been 
lawfully admitted to the United States for permanent residence (and 
maintains such a residence) under the Immigration and Nationality Act, 
as amended (8 U.S.C. 1101(a), section 101(a)20, 60 Stat. 163), or is an 
official of a foreign government entity in the United States.
    (b) In addition, all applications for licenses must include, on the 
application or an addendum sheet, the complete names and addresses of 
all U.S. consignors and freight forwarders, and all foreign consignees 
and foreign intermediate consignees involved in the transaction. If 
there are multiple consignors, consignees or freight forwarders, and all 
the required information cannot be included on the application form, an 
addendum sheet and seven copies containing this information must be 
provided. The addendum sheet must be marked at the top as follows: 
``Attachment to Department of State License From (insert DSP-5, 61, 73, 
or 85, as appropriate) for Export of (insert commodity) valued at 
(insert U.S. dollar amount) to (insert country of ultimate 
destination).'' The Office of Defense Trade Controls will impress one 
copy of the addendum sheet with the Department of State seal and return 
it to the applicant with each license. The sealed addendum sheet must 
remain attached to the license as an integral part thereof. District 
Directors of Customs and Department of Defense transmittal authorities 
will permit only those U.S. consignors or freight forwarders listed on 
the license or sealed addendum sheet to make shipments under the 
license, and only to those foreign consignees named on the documents. 
Applicants should list all freight forwarders who may be involved with 
shipments under the license to ensure that the list is complete and to 
avoid the need for amendments to the list after the license has been 
approved. If there are unusual or extraordinary circumstances that 
preclude the specific identification of all the U.S. consignors and 
freight forwarders and all foreign consignees, the applicant must 
provide a letter of explanation with each application.
    (c) In cases when foreign nationals are employed at or assigned to 
security-cleared facilities, provision by the applicant of a Technology 
Control Plan (available from the Defense Investigative Service) will 
facilitate processing.



PART 127--VIOLATIONS AND PENALTIES--Table of Contents




Sec.
127.1  Violations.
127.2  Misrepresentation and omission of facts.
127.3  Penalties for violations.
127.4  Authority of U.S. Customs Service officers.
127.5  Authority of the Defense Investigative Service.
126.6  Seizure and forfeiture in attempts at illegal exports.
127.7  Debarment.
127.8  Interim suspension.
127.9  Applicability of orders.
127.10  Civil penalty.
127.11  Past violations.
127.12  Voluntary disclosures.

    Authority:  Secs. 2, 38, and 42, Pub. L. 90-629, 90 Stat. 744 (22 
U.S.C. 2752, 2778, 2791); E.O. 11958, 42 FR 4311, 3 CFR, 1977 Comp., p. 
79; 22 U.S.C. 401; 22 U.S.C. 2658; 22 U.S.C. 2779a; 22 U.S.C. 2780.

    Source:  58 FR 39316, July 22, 1993, unless otherwise noted.



Sec. 127.1  Violations.

    (a) It is unlawful:
    (1) To export or attempt to export from the United States any 
defense article or technical data or to furnish any defense service for 
which a license or written approval is required by this subchapter 
without first obtaining the required license or written approval from 
the Office of Defense Trade Controls;
    (2) To import or attempt to import any defense article whenever a 
license is required by this subchapter without first obtaining the 
required license or written approval from the Office of Defense Trade 
Controls;

[[Page 391]]

    (3) To conspire to export, import, reexport or cause to be exported, 
imported or reexported, any defense article or to furnish any defense 
service for which a license or written approval is required by this 
subchapter without first obtaining the required license or written 
approval from the Office of Defense Trade Controls; or
    (4) To violate any of the terms or conditions of licenses or 
approvals granted pursuant to this subchapter.
    (b) Any person who is granted a license or other approval under this 
subchapter is responsible for the acts of employees, agents, and all 
authorized persons to whom possession of the licensed defense article or 
technical data has been entrusted regarding the operation, use, 
possession, transportation, and handling of such defense article or 
technical data abroad. All persons abroad subject to U.S. jurisdiction 
who obtain temporary custody of a defense article exported from the 
United States or produced under an agreement described in part 124 of 
this subchapter, and irrespective of the number of intermediate 
transfers, are bound by the regulations of this subchapter in the same 
manner and to the same extent as the original owner or transferer.
    (c) A person with knowledge that another person is then ineligible 
pursuant to Secs. 120.1(c) of this subchapter or 126.7 of this chapter, 
is then subject to an order of debarment, or interim suspension, may 
not, directly or indirectly, in any manner or capacity, without prior 
disclosure of the facts to, and written authorization from, the Office 
of Defense Trade Controls:
    (1) Apply for, obtain, or use any export control document as defined 
in Sec. 127.2(b) for such debarred, suspended, or ineligible person; or
    (2) Order, buy, receive, use, sell, deliver, store, dispose of, 
forward, transport, finance, or otherwise service or participate in any 
transaction which may involve any defense article or the furnishing of 
any defense service for which a license or approval is required by this 
subchapter for export, where such debarred, suspended, or ineligible 
person may obtain any benefit therefrom or have any direct or indirect 
interest therein.
    (d) No person may willfully cause, or aid, abet, counsel, demand, 
induce, procure or permit the commission of any act prohibited by, or 
the omission of any act required by 22 U.S.C. 2778, 22 U.S.C. 2779, or 
any regulation, license, approval, or order issued thereunder.



Sec. 127.2  Misrepresentation and omission of facts.

    (a) It is unlawful to use any export or temporary import control 
document containing a false statement or misrepresenting or omitting a 
material fact for the purpose of exporting any defense article or 
technical data or the furnishing of any defense service for which a 
license or approval is required by this subchapter. Any false statement, 
misrepresentation, or omission of material fact in an export or 
temporary import control document will be considered as made in a matter 
within the jurisdiction of a department or agency of the United States 
for the purposes of 18 U.S.C. 1001, 22 U.S.C. 2778 and 22 U.S.C. 2779.
    (b) For the purpose of this section, export or temporary import 
control documents include the following:
    (1) An application for a permanent export or a temporary import 
license and supporting documents.
    (2) Shipper's Export Declaration.
    (3) Invoice.
    (4) Declaration of destination.
    (5) Delivery verification.
    (6) Application for temporary export.
    (7) Application for registration.
    (8) Purchase order.
    (9) Foreign import certificate.
    (10) Bill-of-lading.
    (11) Airway bill.
    (12) Nontransfer and use certificate.
    (13) Any other document used in the regulation or control of a 
defense article, defense service or technical data for which a license 
or approval is required by this subchapter.



Sec. 127.3  Penalties for violations.

    Any person who willfully:
    (a) Violates any provision of section 38 or section 39 of the Arms 
Export Control Act (22 U.S.C. 2778 and 2779), or any undertaking 
specifically required by part 124 of this subchapter; or
    (b) In a registration, license application or report required by 
section 38 or

[[Page 392]]

section 39 of the Arms Export Control Act (22 U.S.C. 2278 and 2779) or 
by any rule or regulation issued under either section, makes any untrue 
statement of a material fact or omits a material fact required to be 
stated therein or necessary to make the statements therein not 
misleading, shall, upon conviction, be subject to a fine or 
imprisonment, or both, as prescribed by 22 U.S.C. 2778(c).



Sec. 127.4  Authority of U.S. Customs Service officers.

    (a) U.S. Customs Service officers may take appropriate action to 
ensure observance of this subchapter as to the export or the attempted 
export of any defense article or technical data, including the 
inspection of loading or unloading of any vessel, vehicle, or aircraft. 
This applies whether the export is authorized by license or by written 
approval issued under this subchapter.
    (b) U.S. Customs Service officers have the authority to investigate, 
detain or seize any export or attempted export of defense articles or 
technical data contrary to this subchapter.
    (c) Upon the presentation to a Customs Officer of a license or 
written approval authorizing the export of any defense article, the 
customs officer may require the production of other relevant documents 
and information relating to the proposed export. This includes an 
invoice, order, packing list, shipping document, correspondence, 
instructions, and the documents otherwise required by the U.S. Customs 
Service.



Sec. 127.5  Authority of the Defense Investigative Service.

    In the case of exports involving classified technical data or 
defense articles, the Defense Investigative Service may take appropriate 
action to ensure compliance with the Department of Defense Industrial 
Security Manual. Upon a request to the Defense Investigative Service 
regarding the export of any classified defense article or technical 
data, the Defense Investigative Service official or a designated 
government transmittal authority may require the production of other 
relevant documents and information relating to the proposed export.



Sec. 127.6  Seizure and forfeiture in attempts at illegal exports.

    (a) An attempt to export from the United States any defense articles 
in violation of the provisions of this subchapter constitutes an offense 
punishable under section 401 of title 22 of the United States Code. 
Whenever it is known or there is probable cause to believe that any 
defense article is intended to be or is being or has been exported or 
removed from the United States in violation of law, such article and any 
vessel, vehicle or aircraft involved in such attempt is subject to 
seizure, forfeiture and disposition as provided in section 401 of title 
22 of the United States Code.
    (b) Similarly, an attempt to violate any of the conditions under 
which a temporary export or temporary import license was issued pursuant 
to this subchapter or to violate the requirements of Sec. 123.2 of this 
subchapter also constitutes an offense punishable under section 401 of 
title 22 of the United States Code, and such article, together with any 
vessel, vehicle or aircraft involved in any such attempt is subject to 
seizure, forfeiture, and disposition as provided in section 401 of title 
22 of the United States Code.



Sec. 127.7  Debarment.

    (a) In implementing section 38 of the Arms Export Control Act, the 
Assistant Secretary of State for Politico-Military Affairs may prohibit 
any person from participating directly or indirectly in the export of 
defense articles, including technical data or in the furnishing of 
defense services for which a license or approval is required by this 
subchapter for any of the reasons listed below. Any such prohibition is 
referred to as a debarment for purposes of this subchapter. The 
Assistant Secretary of State for Politico-Military Affairs shall 
determine the appropriate period of time for debarment, which shall 
generally be for a period of three years.
    (b) Grounds. (1) The basis for a statutory debarment, as described 
in paragraph (c) of this section, is any conviction for violating the 
Arms Export Control Act (see Sec. 127.3 of this subchapter) or any 
conspiracy to violate the Arms Export Control Act.

[[Page 393]]

    (2) The basis for administrative debarment, described in part 128 of 
this subchapter, is any violation of 22 U.S.C. 2778 or any rule or 
regulation issued thereunder when such a violation is of such a 
character as to provide a reasonable basis for the Office of Defense 
Trade Controls to believe that the violator cannot be relied upon to 
comply with the statute or these rules or regulations in the future, and 
when such violation is established in accordance with part 128 of this 
subchapter.
    (c) Statutory Debarment. Section 38(g)(4) of the Arms Export Control 
Act prohibits the issuance of licenses to persons who have been 
convicted of violating the U.S. criminal statutes enumerated in 
Sec. 120.27 of this subchapter. Discretionary authority to issue 
licenses is provided, but only if certain statutory requirements are 
met. It is the policy of the Department of State not to consider 
applications for licenses or requests for approvals involving any person 
who has been convicted of violating the Arms Export Control Act or 
convicted of conspiracy to violate that Act for a three year period 
following conviction. Such individuals shall be notified in writing that 
they are debarred pursuant to this policy. A list of persons who have 
been convicted of such offenses and debarred for this reason shall be 
published periodically in the Federal Register. Debarment in such cases 
is based solely upon the outcome of a criminal proceeding, conducted by 
a court of the United States, that established guilt beyond a reasonable 
doubt in accordance with due process. The procedures of part 128 of this 
subchapter are not applicable in such cases.
    (d) Appeals. Any person who is ineligible pursuant to paragraph (c) 
of this section may appeal to the Under Secretary of State for 
International Security Affairs for reconsideration of the ineligibility 
determination. The procedures specified in Sec. 128.13 of this 
subchapter are applicable in such appeals.



Sec. 127.8  Interim suspension.

    (a) The Director of the Office of Defense Trade Controls is 
authorized to order the interim suspension of any person when the 
Director believes that grounds for debarment (as defined in Sec. 127.6 
of this part) exist and where and to the extent the Director finds that 
interim suspension is reasonably necessary to protect world peace or the 
security or foreign policy of the United States. The interim suspension 
orders prohibit that person from participating directly or indirectly in 
the export of any defense article or defense service for which a license 
or approval is required by this subchapter. The suspended person shall 
be notified in writing as provided in Sec. 127.6(c) of this part 
(statutory debarment) or Sec. 128.3 of this subchapter (administrative 
debarment), whichever is appropriate. In both cases, a copy of the 
interim suspension order will be served upon that person in the same 
manner as provided in Sec. 128.3 of this subchapter. The interim 
suspension order may be made immediately effective, without prior 
notice. The order will state the relevant facts, the grounds for 
issuance of the order, and describe the nature and duration of the 
interim suspension. No person may be suspended for a period exceeding 60 
days unless proceedings under Sec. 127.6(c) of this part or under part 
128 of this subchapter, or criminal proceedings, are initiated before 
the expiration of that period.
    (b) A motion or petition to vacate or modify an interim suspension 
order may be filed at any time with the Under Secretary of State for 
International Security Affairs. After a final decision is reached, the 
Director of the Office of Defense Trade Controls will issue an 
appropriate order disposing of the motion or petition and will promptly 
inform the respondent accordingly.



Sec. 127.9  Applicability of orders.

    For the purpose of preventing evasion, orders of the Assistant 
Secretary of State for Politico-Military Affairs, debarring a person 
under Sec. 127.6 and orders of the Director, Office of Defense Trade 
Controls, suspending a person under Sec. 127.7 may be made applicable to 
any other person who may then or thereafter (during the term of the 
order) be related to the debarred person by affiliation, ownership, 
control, position of responsibility, or other commercial connection. 
Appropriate notice

[[Page 394]]

and opportunity to respond to charges will be given.



Sec. 127.10  Civil penalty.

    (a) The Assistant Secretary of State for Political-Military Affairs, 
Department of State, is authorized to impose a civil penalty in an 
amount not to exceed that authorized by 22 U.S.C. 2778, 2779a and 2780 
for each violation of 22 U.S.C. 2778, 2779a and 2780, or any regulation, 
order, license or approval issued thereunder. This civil penalty may be 
either in addition to, or in lieu of, any other liability or penalty 
which may be imposed.
    (b) The Office of Defense Trade Controls may make:
    (1) The payment of a civil penalty under this section or
    (2) The completion of any administrative action pursuant to this 
part 127 or 128 of this subchapter a prior condition for the issuance, 
restoration, or continuing validity of any export license or other 
approval.
[58 FR 39316, July 22, 1993, as amended at 62 FR 67276, Dec. 24, 1997]



Sec. 127.11  Past violations.

    (a) Pursuant to section 38 of the Arms Export Control Act, licenses 
or other approvals may not be granted to persons who have been convicted 
of violating any of the U.S. criminal statutes enumerated in Sec. 120.27 
of this subchapter or who are ineligible to receive any export licenses 
from any agency of the U.S. government, subject to a narrowly defined 
statutory exception. This provision establishes a presumption of denial 
for licenses or other approvals involving such persons. This presumption 
is applied by the Office of Defense Trade Controls to all persons 
convicted or deemed ineligible in this manner since the effective date 
of the Arms Export Control Act (Pub. L. 94-329; 90 Stat. 729) (June 30, 
1976).
    (b) Policy. An exception to the policy of the Department of State to 
deny applications for licenses or other approvals that involve persons 
described in paragraph (a) of this section shall not be considered 
unless there are extraordinary circumstances surrounding the conviction 
or ineligibility to export, and only if the applicant demonstrates, to 
the satisfaction of the Bureau of Politico-Military Affairs, that the 
applicant has taken appropriate steps to mitigate any law enforcement 
and other legitimate concerns, and to deal with the causes that resulted 
in the conviction, ineligibility, or debarment. Any person described in 
paragraph (a) of this section who wishes to request consideration of any 
application must explain, in a letter to the Director, Office of Defense 
Trade Controls, the reasons why the application should be considered. If 
the Bureau of Politico-Military Affairs concludes that the application 
and written explanation have sufficient merit, it shall consult with the 
Office of the Legal Adviser and the Department of the Treasury regarding 
law enforcement concerns, and may also request the views of other 
departments, including the Department of Justice. If the Office of 
Defense Trade Controls does grant the license or other approval, 
subsequent applications from the same person need not repeat the 
information previously provided but should instead refer to the 
favorable decision.
    (c) Debarred persons. Persons debarred pursuant to Sec. 127.6(c) 
(statutory debarment) may not utilize the procedures provided by this 
section while the debarment is in force. Such persons may utilize only 
the procedures provided by Sec. 127.7(d) of this part.



Sec. 127.12  Voluntary disclosures.

    (a) General policy. The Department strongly encourages the 
disclosure of information to the Office of Defense Trade Controls by 
persons, firms or any organization that believe they may have violated 
any export control provision of the Arms Export Control Act, or any 
regulations, order, license, or other authorization issued under the 
Arms Export Control Act. Voluntary self-disclosure may be considered a 
mitigating factor in determining the administrative penalties, if any, 
that should be imposed by the Department. Failure to report such 
violation(s) may result in circumstances detrimental to U.S. national 
security and foreign policy interests.
    (b) Limitations. (1) The provisions of this section apply only when 
information is provided to the Office of Defense

[[Page 395]]

Trade Controls for its review in determining whether to take 
administrative action under part 128 of this subchapter concerning 
violation(s) of the export control provisions of the Arms Export Control 
Act and these regulations.
    (2) The provisions of this section apply only when information is 
received by the Office of Defense Trade Controls for review prior to 
such time that either the Department of State or any other agency, 
bureau or department of the United States Government obtains knowledge 
of either the same or substantially similar information from another 
source and commenced an investigation or inquiry that involves that 
information, and that is intended to determine whether the Arms Export 
Control Act or these regulations, or any other license, order or other 
authorization issued under the Arms Export Control Act has been 
violated.
    (3) It is possible that the activity in question--despite voluntary 
disclosure--might merit penalties, administrative actions, sanctions, or 
referrals to the Department of Justice for consideration as to whether 
criminal prosecution is warranted. In the latter case, the Office of 
Defense Trade Controls will notify the Department of Justice of the 
voluntary nature of the disclosure although the Department of Justice is 
not required to give that fact any weight. The Office of Defense Trade 
Controls has the sole discretion to consider whether ``voluntary 
disclosure,'' in context with other relevant information in a particular 
case, should be a mitigating factor in determining what, if any, 
administrative action will be imposed. Some of the mitigating factors 
the Office of Defense Trade Controls may consider are:
    (i) Whether the transaction would have been authorized had proper 
application been made;
    (ii) Why the violation(s) occurred;
    (iii) The degree of cooperation with the ensuing investigation;
    (iv) Whether the person or firm has instituted or improved an 
internal compliance program to reduce the likelihood of future 
violation(s);
    (v) Whether the person making the disclosure did so with the full 
knowledge and authorization of the firm's senior management. (If not, 
then a firm will not be deemed to have made a disclosure as covered in 
this section.)
    (4) The provisions of this section do not, nor should they be relied 
on, to create, confer, or grant any rights, benefits, privileges, or 
protection enforceable at law or in equity by any person, business, or 
entity in any civil, criminal, administrative, or other matter.
    (c) Notification. (1) Any person or firm wanting to disclose 
information that constitutes a voluntary self-disclosure should, in the 
manner outlined below, initially notify the Office of Defense Trade 
Controls as soon as possible after violation(s) are discovered and then 
conduct a thorough review of all export-related transactions where 
violation(s) are suspected.
    (2) Notification of violation(s) must be in writing and should 
include the following information:
    (i) A precise description of the nature and extent of the 
violation(s) (e.g., an unauthorized shipment, doing business with a 
party denied U.S. export privileges, etc.);
    (ii) The exact circumstances surrounding the violation(s) (a 
thorough explanation of why, when, where, and how the violation(s) 
occurred);
    (iii) The complete identities and addresses of all individuals and 
organizations, whether foreign or domestic, involved in the activities 
giving rise to the violation(s);
    (iv) Export license numbers, if applicable;
    (v) U.S. Munitions List category and subcategory, product 
descriptions, quantities, and characteristics of the commodities or 
technical data involved;
    (vi) A description of any corrective actions already undertaken;
    (vii) The name and address of the person(s) making the disclosure 
and a point of contact, if different, should further information be 
needed.
    (3) Factors to be considered include, for example, whether the 
violation(s) were intentional or inadvertent; the degree to which the 
person or firm responsible for the violation(s) making the disclosure 
was familiar with the laws and regulations; and whether the violator was 
the subject of prior administrative or criminal action under

[[Page 396]]

the AECA. In addition to immediately providing written notification, 
persons, firms, companies and organizations are strongly urged to 
conduct a thorough review of all export-related transactions where 
possible violation(s) are suspected.
    (d) Documentation. (1) The written disclosure should be accompanied 
by copies of those documents that substantiate it. Where appropriate, 
the documentation should include, but is not limited to:
    (i) Licensing documents (e.g., license applications, export licenses 
and end-user statements);
    (ii) Shipping documents (e.g., shipper's export declarations, airway 
bills and bills of lading);
    (iii) Any other relevant documents must be retained by the person 
making the disclosure until the Office of Defense Trade Controls 
requests them or until a final decision on the disclosed information has 
been made.
    (e) Certification. A certification must be submitted stating that 
all of the representations made in connection with the voluntary self-
disclosure are true and correct to the best of that person's knowledge 
and belief. Certifications made by a firm, corporation or any other 
organization should be executed by someone with the authority to do so.
    (f) Oral presentations. It is generally not necessary to augment the 
written presentation with an oral presentation. However, if the person 
making the disclosure believes a meeting is desirable, a request for one 
should be included with the written presentation.
    (g) Voluntary disclosures should be sent to:

    Compliance Analysis Division, PM/DTC, SA-6, room 200, Office of 
Defense Trade Controls, Bureau of Politico-Military Affairs, U.S. 
Department of State, Washington, DC 20522-0602.



PART 128--ADMINISTRATIVE PROCEDURES--Table of Contents




Sec.
128.1  Exclusion of functions from the Administrative Procedure Act.
128.2  Administrative Law Judge.
128.3  Institution of Administrative Proceedings.
128.4  Default.
128.5  Answer and demand for oral hearing.
128.6  Discovery.
128.7  Prehearing conference.
128.8  Hearings.
128.9  Proceedings before and report of Administrative Law Judge.
128.10  Disposition of proceedings.
128.11  Consent agreements.
128.12  Rehearings.
128.13  Appeals.
128.14  Confidentiality of proceedings.
128.15  Orders containing probationary periods.
128.16  Extension of time.
128.17  Availability of orders.

    Authority:  Secs. 2, 38, 40, 42, and 71, Arms Export Control Act. 90 
Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); E.O. 11958, 42 
FR 4311: 22 U.S.C. 2658; E.O. 12291, 46 FR 1981.

    Source:  58 FR 39320, July 22, 1993, unless otherwise noted.



Sec. 128.1  Exclusion of functions from the Administrative Procedure Act.

    The Arms Export Control Act authorizes the President to control the 
import and export of defense articles and services in furtherance of 
world peace and the security and foreign policy of the United States. It 
authorizes the Secretary of State to make decisions on whether license 
applications or other written requests for approval shall be granted, or 
whether exemptions may be used. It also authorizes the Secretary of 
State to revoke, suspend or amend licenses or other written approvals 
whenever the Secretary deems such action to be advisable. The 
administration of the Arms Export Control Act is a foreign affairs 
function encompassed within the meaning of the military and foreign 
affairs exclusion of the Administrative Procedure Act and is thereby 
expressly exempt from various provisions of that Act. Because the 
exercising of the foreign affairs function, including the decisions 
required to implement the Arms Export Control Act, is highly 
discretionary, it is excluded from review under the Administrative 
Procedure Act.
[61 FR 48831, Sept. 17, 1996]

[[Page 397]]



Sec. 128.2  Administrative Law Judge

    The Administrative Law Judge referred to in this part is an 
Administrative Law Judge appointed by the Department of State or of the 
Department of Commerce, as provided in 15 CFR 788.2. The Administrative 
Law Judge is authorized to exercise the powers and perform the duties 
provided for in Secs. 127.7, 127.8, and 128.3 through 128.16 of this 
subchapter.
[61 FR 48831, Sept. 17, 1996]



Sec. 128.3  Institution of Administrative Proceedings.

    (a) Charging letters. The Director, Office of Defense Trade 
Controls, with the concurrence of the Office of the Legal Adviser, 
Department of State, may initiate proceedings to impose debarment or 
civil penalties in accordance with Sec. 127.7 or Sec. 127.10 of this 
subchapter respectively. Administrative proceedings shall be initiated 
by means of a charging letter. The charging letter will state the 
essential facts constituting the alleged violation and refer to the 
regulatory or other provisions involved. It will give notice to the 
respondent to answer the charges within 30 days, as provided in 
Sec. 128.5(a), and indicate that a failure to answer will be taken as an 
admission of the truth of the charges. It will inform the respondent 
that he or she is entitled to an oral hearing if a written demand for 
one is filed with the answer or within seven (7) days after service of 
the answer. The respondent will also be informed that he or she may, if 
so desired, be represented by counsel of his or her choosing. Charging 
letters may be amended from time to time, upon reasonable notice.
    (b) Service. A charging letter is served upon a respondent:
    (1) If the respondent is a resident of the United States, when it is 
mailed postage prepaid in a wrapper addressed to the respondent at that 
person's last known address; or when left with the respondent or the 
agent or employee of the respondent; or when left at the respondent's 
dwelling with some person of suitable age and discretion then residing 
herein; or
    (2) If the respondent is a non-resident of the United States, when 
served upon the respondent by any of the foregoing means. If such 
methods of service are not practicable or appropriate, the charging 
letter may be tendered for service on the respondent to an official of 
the government of the country wherein the respondent resides, provided 
that there is an agreement or understanding between the United States 
Government and the government of the country wherein the respondent 
resident permitting this action.
[61 FR 48831, Sept. 17, 1996]



Sec. 128.4  Default.

    (a) Failure to answer. If the respondent fails to answer the 
charging letter, the respondent may be held in default. The case shall 
then be referred to the Administrative Law Judge for consideration in a 
manner as the Administrative Law Judge may consider appropriate. Any 
order issued shall have the same effect as an order issued following the 
disposition of contested charges.
    (b) Petition to set aside defaults. Upon showing good cause, any 
respondent against whom a default order has been issued may apply to set 
aside the default and vacate the order entered thereon. The petition 
shall be submitted to duplicate to the Assistant Secretary for 
Political-Military Affairs, U.S. Department of State, 2201 C Street, 
NW., Washington, DC 20520. The Director will refer the petition to the 
Administrative Law Judge for consideration and a recommendation. The 
Administrative law Judge will consider the application and may order a 
hearing and require the respondent to submit further evidence in support 
of his or her petition. The filing of a petition to set aside a default 
does not in any manner affect an order entered upon default and such 
order continues in full force and effect unless a further order is made 
modifying or terminating it.
[61 FR 48832, Sept. 17, 1996]



Sec. 128.5  Answer and demand for oral hearing.

    (a) When to answer. The respondent is required to answer the 
charging letter within 30 days after service.

[[Page 398]]

    (b) Contents of answer. An answer must be responsive to the charging 
letter. It must fully set forth the nature of the respondent's defense 
or defenses. In the answer, the respondent must admit or deny 
specifically each separate allegation of the charging letter, unless the 
respondent is without knowledge, in which case the respondent's answer 
shall so state and the statement shall operate as denial. Failure to 
deny or controvert any particular allegation will be deemed an admission 
thereof. The answer may set forth such additional or new matter as the 
respondent believes support a defense or claim of mitigation. Any 
defense or partial defense not specifically set forth in an answer shall 
be deemed waived. Evidence offered thereon by the respondent at a 
hearing may be refused except upon good cause being shown. If the 
respondent does not demand an oral hearing, he or she shall transmit, 
within seven (7) days after the service of his or her answer, original 
or photocopies of all correspondence, papers, records, affidavits, and 
other documentary or written evidence having any bearing upon or 
connection with the matters in issue. If any such materials are in 
language other than English, translations into English shall be 
submitted at the same time.
    (c) Submission of answer. The answer, written demand for oral 
hearing (if any) and supporting evidence required by Sec. 128.5(b) shall 
be in duplicate and mailed or delivered to the Office of Administrative 
Law Judge, United States Department of Commerce, Room H-6716. 14th 
Street and Constitution Avenue, NW., Washington, DC 20230. A copy shall 
be simultaneously mailed to the Director, Office of Defense Trade 
Controls, SA-6, Room 200, Department of State, Washington, DC 20522-
0602, or delivered to the 21st street entrance of the Department of 
State, 2201 C Street, NW., Washington, DC addressed to Director, Office 
of Defense Trade Controls, SA-6, Room 200, Department of State, 
Washington, DC 20522-0602.
[58 FR 39320, July 22, 1993, as amended at 61 FR 48832, Sept. 17, 1996]



Sec. 128.6  Discovery.

    (a) Discovery by the respondent. The respondent, through the 
Administrative Law Judge, may request from the Office of Defense Trade 
Controls any relevant information, not privileged, that may be necessary 
or helpful in preparing a defense. The Office of Defense Trade Controls 
may provide any relevant information, not privileged, that may be 
necessary or helpful in preparing a defense. The Office of Defense Trade 
Controls may supply summaries in place or original documents and may 
withhold information from discovery if the interests of national 
security or foreign policy so require, or if necessary to comply with 
any statute, executive order or regulation requiring that the 
information may not be disclosed. The respondent may request the 
Administrative Law Judge to request any relevant information, books, 
records, or other evidence, from any other person or government agency 
so long as the request is reasonable in scope and not unduly burdensome.
    (b) Discovery by the Office of Defense Trade Controls. The Office of 
Defense Trade Controls or the Administrative Law Judge may request from 
the respondent admissions of facts, answers to interrogatories, the 
production of books, records, or other relevant evidence, so long as the 
request is relevant and material, reasonable in scope, and not unduly 
burdensome.
    (c) Subpoenas. At the request of any party, the Administrative Law 
Judge may issue subpoenas, returnable before him, requiring the 
attendance of witnesses and the production of books, records, and other 
documentary or physical evidence determined by he Administrative Law 
Judge to be relevant and material to the proceedings, reasonable in 
scope, and not unduly burdensome.
    (d) Enforcement of discovery rights. If the Office of Defense Trade 
Controls fails to provide the respondent with information in its 
possession which is not otherwise available and which is necessary to 
the respondent's defense, the Administrative Law Judge may dismiss the 
charges on her or his own motion or on a motion of the respondent. If 
the respondent fails to respond with reasonable diligence to the 
requests for discovery by the Office of Defense Trade Controls or the 
Administrative Law Judge, on her or his own

[[Page 399]]

motion or motion of the Office of Defense Trade Controls, and upon such 
notice to the respondent as the Administrative Law Judge may direct, may 
strike respondent's answer and declare the respondent in default, or 
make any other ruling which the Administrative Law Judge deems necessary 
and just under the circumstances. If a third party fails to respond to 
the request for information, the Administrative Law Judge shall consider 
whether the evidence sought is necessary to a fair hearing, and if it is 
so necessary that a fair hearing may not be held without it, the 
Administrative Law Judge shall dismiss the charges.
[61 FR 48832, Sept. 17, 1996]



Sec. 128.7  Prehearing conference.

    (a)(1) The Administrative Law Judge may, upon his own motion or upon 
motion of any party, request the parties or their counsel to a 
prehearing conference to consider:
    (i) Simplification of issues;
    (ii) The necessity of desirability of amendments to pleadings;
    (iii) Obtaining stipulations of fact and of documents to avoid 
unnecessary proof; or
    (iv) Such other matter as may expedite the disposition of the 
proceeding.
    (2) The Administrative Law Judge will prepare a summary of the 
action agreed upon or taken at the conference, and will incorporate 
therein any written stipulations or agreements made by the parties.
    (3) The conference proceedings may be recorded magnetically or taken 
by a reporter and transcribed, and filed with the Administrative Law 
Judge.
    (b) If a conference is impracticable , the Administrative Law Judge 
may request the parties to correspond with the person to achieve the 
purposes of a conference. The Administrative Law Judge shall prepare a 
summary of action taken as in the case of a conference.
[61 FR 48832, Sept. 17, 1996]



Sec. 128.8  Hearings.

    (a) A respondent who had not filed a timely written answer is not 
entitled to a hearing, and the case may be considered by the 
Administrative Law Judge as provided in Sec. 128.4(a). If any answer is 
filed, but no oral hearing demanded, the Administrative Law Judge may 
proceed to consider the case upon the written pleadings and evidence 
available. The Administrative Law Judge may provide for the making of 
the record in such manner as the Administrative Law Judge deems 
appropriate. If respondent answers and demands an oral hearing, the 
Administrative Law Judge, upon due notice, shall set the case for 
hearing, unless a respondent has raised in his answer no issues of 
material fact to be determined. If respondent fails to appear at a 
scheduled hearing, the hearing nevertheless may proceed in respondent's 
absence. The respondent's failure to appear will not affect the validity 
of the hearing or any proceedings or action thereafter.
    (b) The Administrative Law Judge may administer oaths and 
affirmations. Respondent may be represented by counsel. Unless otherwise 
agreed by the parties and the Administrative Law Judge the proceeding 
will be taken by a reporter or by magnetic recording, transcribed, and 
filed with the Administrative Law Judge. Respondent may examine the 
transcript and may obtain a copy upon payment of proper costs.
[61 FR 48833, Sept. 17, 1996]



Sec. 128.9  Proceedings before and report of Administrative Law Judge.

    (a) The Administrative Law Judge may conform any part of the 
proceedings before him or her to the Federal Rules of Civil Procedure. 
The record may be made available in any other administrative or other 
proceeding involving the same respondent.
    (b) The Administrative Law Judge, after considering the record, will 
prepare a written report. The report will include findings of fact, 
findings of law, a finding whether a law or regulation has been 
violated, and the Administrative Law Judge's recommendations. It shall 
be transmitted to the Assistant Secretary for Political-Military 
Affairs, Department of State.
[61 FR 48833, Sept. 17, 1996]

[[Page 400]]



Sec. 128.10  Disposition of proceedings.

    Where the evidence is not sufficient to support the charges, the 
Director, Office of Defense Trade Controls or the Administrative Law 
Judge will dismiss the charges. Where the Administrative Law Judge finds 
that a violation has been committed, the Administrative Law Judge's 
recommendation shall be advisory only. The Assistant Secretary for 
Political-Military Affairs will review the record, consider the report 
of the Administrative Law Judge, and make an appropriate disposition of 
the case. The Director may issue an order debarring the respondent from 
participating in the export of defense articles or technical data or the 
furnishing of defense services as provided in Sec. 127.7 of this 
subchapter, impose a civil penalty as provided in Sec. 127.10 of this 
subchapter or take such action as the Administrative Law Judge deems 
appropriate. Any debarment order will be effective for the period of 
time specified therein and may contain such additional terms and 
conditions as are deemed appropriate. A copy of the order together with 
a copy of the Administrative Law Judge's report will be served upon the 
respondent.
[61 FR 48833, Sept. 17, 1996]



Sec. 128.11  Consent agreements.

    (a) The Office of Defense Trade Controls and the respondent may, by 
agreement, submit to the Administrative Law Judge a proposal for the 
issuance of a consent order. The Administrative Law Judge will review 
the facts of the case and the proposal and may conduct conferences with 
the parties and may require the presentation of evidence in the case. If 
the Administrative Law Judge does not approve the proposal, the 
Administrative Law Judge will notify the parties and the case will 
proceed as though no consent proposal had been made. If the proposal is 
approved, the Administrative Law Judge will report the facts of the case 
along with recommendations to the Assistant Secretary for Political-
Military Affairs. If the Assistant Secretary for Political-Military 
Affairs does not approve the proposal, the case will proceed as though 
no consent proposal had been made. If the Assistant Secretary for 
Political-Military Affairs approves the proposal, an appropriate order 
may be issued.
    (b) Cases may also be settled prior to service of a charging letter. 
In such an event, a proposed charging letter shall be prepared, and a 
consent agreement and order shall be submitted for the approval and 
signature of the Assistant Secretary for Political-Military Affairs, and 
no action by the Administrative Law Judge shall be required. Cases which 
are settled may not be reopened or appealed.
[61 FR 48833, Sept. 17, 1996]



Sec. 128.12  Rehearings.

    The Administrative Law Judge may grant a rehearing or reopen a 
proceeding at any time for the purpose of hearing any relevant and 
material evidence which was not known or obtainable at the time of the 
original hearing. A report for rehearing or reopening must contain a 
summary of such evidence, and must explain the reasons why it could not 
have been presented at the original hearing. The Administrative Law 
Judge will inform the parties of any further hearing, and will conduct 
such hearing and submit a report and recommendations in the same manner 
as provided for the original proceeding (Described in Sec. 128.10).
[61 FR 48833, Sept. 17, 1996]



Sec. 128.13  Appeals.

    (a) Filing of appeals. An appeal must be in writing, and be 
addressed to and filed with the Under Secretary of State for Arms 
Control and International Security Affairs, Department of State, 
Washington, DC 20520. An appeal from a final order denying export 
privileges or imposing civil penalties must be filed within 30 days 
after receipt of a copy of the order. If the Under Secretary cannot for 
any reason act on the appeal, he or she may designate another Department 
of State official to receive and act on the appeal.
    (b) Grounds and conditions for appeal. The respondent may appeal 
from the debarment or from the imposition of a civil penalty (except the 
imposition of civil penalties pursuant to a consent order pursuant to 
Sec. 128.11) upon the

[[Page 401]]

ground: (1) That the findings of a violation are not supported by any 
substantial evidence; (2) that a prejudicial error of law was committed: 
or (3) that the provisions of the order are arbitrary, capricious, or an 
abuse of discretion. The appeal must specify upon which of these grounds 
the appeal is based and must indicate from which provisions of the order 
the appeal is taken. An appeal from an order issued upon default will 
not be entertained if the respondent has failed to seek relief as 
provided in Sec. 128.4(b).
    (c) Matters considered on appeal. An appeal will be considered upon 
the basis of the assembled record. This record consists of (but is not 
limited to) the charging letter, the respondent's answer, the transcript 
or magnetic recording of the hearing before the Administrative Law 
Judge, the report of the Administrative Law Judge, the order of the 
Assistant Secretary for Political-Military Affairs, and any other 
relevant documents involved in the proceedings before the Administrative 
Law Judge. The Under Secretary of State for Arms Control and 
International Security Affairs may direct a rehearing and reopening 
before the Administrative Law Judge if he or she finds that the record 
is insufficient or that new evidence is relevant and material to the 
issues and was not known and was not available to the respondent at the 
time of the original hearings.
    (d) Effect of appeals. The taking of an appeal will not stay the 
operation of any order.
    (e) Preparation of appeals.--(1) General requirements. An appeal 
shall be in letter form. The appeal and accompanying material should be 
filed in duplicate, unless otherwise indicated, and a copy 
simultaneously mailed to the Director, Office of Defense Trade Controls, 
SA-6, Room 200, Department of State, Washington, DC 20522-0620 or 
delivered to the 21st street entrance of the Department of State, 2201 C 
Street, NW., Washington, DC addressed to Director, Office of Defense 
Trade Controls, SA-6, Room 200, Department of State, Washington, DC 
20522-0602.
    (2) Oral presentation. The Under Secretary of State for Arms Control 
and International Security Affairs may grant the appellant an 
opportunity for oral argument and will set the time and place for oral 
argument and will notify the parties, ordinarily at least 10 days before 
the date set.
    (f) Decisions. All appeals will be considered and decided within a 
reasonable time after they are filed. An appeal may be granted or denied 
in whole or in part, or dismissed at the request of the appellant. The 
decision of the Under Secretary of State for Arms Control and 
International Security Affairs will be final.
[58 FR 39320, July 22, 1993, as amended at 61 FR 48833, Sept. 17, 1996]



Sec. 128.14  Confidentiality of proceedings.

    Proceedings under this part are confidential. The documents referred 
to in Sec. 128.17 are not, however, deemed to be confidential. Reports 
of the Administrative Law Judge and copies of transcripts or recordings 
of hearings will be available to parties and, to the extent of their own 
testimony, to witnesses. All records are available to any U.S. 
Government agency showing a proper interest therein.
[61 FR 48834, Sept. 17, 1996]



Sec. 128.15  Orders containing probationary periods.

    (a) Revocation of probationary periods. A debarment or interim 
suspension order may set a probationary period during which the order 
may be held in abeyance for all or part of the debarment or suspension 
period, subject to the conditions stated therein. The Director, Office 
of Defense Trade Controls, may apply without notice to any person to be 
affected thereby, to the Administrative Law Judge for an order revoking 
probation when it appears that the conditions of the probation have been 
breached. The facts in support of the application will be presented to 
the Administrative Law Judge, who will report thereon and make a 
recommendation to the Assistant Secretary for Political-Military 
Affairs. The latter will make a determination whether to revoke 
probation and will issue an appropriate order.

[[Page 402]]

    (b) Hearings--(1) Objections upon notice. Any person affected by an 
application upon notice to revoke probation, within the time specified 
in the notice, may file objections with the Administrative Law Judge.
    (2) Objections to order without notice. Any person adversely 
affected by an order revoking probation, without notice may request that 
the order be set aside by filing his objections thereto with the 
Administrative Law Judge. The request will not stay the effective date 
of the order or revocation.
    (3) Requirements for filing objections. Objections filed with the 
Administrative Law Judge must be submitted in writing and in duplicate. 
A copy must be simultaneously submitted to the Office of Defense Trade 
Controls. Denials and admissions, as well as any mitigating 
circumstances, which the person affected intends to present must be set 
forth in or accompany the letter of objection and must be supported by 
evidence. A request for an oral hearing may be made at the time of 
filing objections.
    (4) Determination. The application and objections thereto will be 
referred to the Administrative Law Judge. An oral hearing if requested, 
will be conducted at an early convenient date, unless the objections 
filed raise no issues of material fact to be determined. The 
Administrative Law Judge will report the facts and make a recommendation 
to the Assistant Secretary for Political-Military Affairs, who will 
determine whether the application should be granted or denied and will 
issue an appropriate order. A copy of the order and of the 
Administrative Law Judge's report will be furnished to any person 
affected thereby.
    (5) Effect of revocation on other actions. The revocation of a 
probationary period will not preclude any other action concerning a 
further violation, even where revocation is based on the further 
violation.
[61 FR 48834, Sept. 17, 1996]



Sec. 128.16  Extension of time.

    The Administrative Law Judge, for good cause shown, may extend the 
time within which to prepare and submit an answer to a charging letter 
or to perform any other act required by this part.
[61 FR 48834, Sept. 17, 1996]



Sec. 128.17  Availability of orders.

    All charging letters, debarment orders, orders imposing civil 
penalties, probationary periods, and interim suspension orders are 
available for public inspection in the Public Reading Room of the 
Department of State.



PART 129--REGISTRATION AND LICENSING OF BROKERS--Table of Contents




Sec.
129.1  Purpose.
129.2  Definitions.
129.3  Requirement to register.
129.4  Registration statement and fees.
129.5  Policy on embargoes and other proscriptions.
129.6  Requirement for license/approval.
129.7  Prior approval (license).
129.8  Prior notification.
129.9  Reports.
129.10  Guidance.

    Authority:  Sec. 38, Pub. L. 104-164, 110 Stat. 1437, (22 U.S.C. 
2778).

    Source: 62 FR 67276, Dec. 24, 1997, unless otherwise noted.



Sec. 129.1  Purpose.

    Section 38(b)(1)(A)(ii) of the Arms Export Control Act (22 U.S.C. 
2778) provides that persons engaged in the business of brokering 
activities shall register and pay a registration fee as prescribed in 
regulations, and that no person may engage in the business of brokering 
activities without a license issued in accordance with the Act.



Sec. 129.2  Definitions.

    (a) Broker means any person who acts as an agent for others in 
negotiating or arranging contracts, purchases, sales or transfers of 
defense articles or defense services in return for a fee, commission, or 
other consideration.
    (b) Brokering activities means acting as a broker as defined in 
Sec. 129.2(a), and includes the financing, transportation, freight 
forwarding, or taking of any other action that facilitates the 
manufacture, export, or import of a defense article or defense service, 
irrespective of its origin. For example, this includes, but is not 
limited to, activities

[[Page 403]]

by U.S. persons who are located inside or outside of the United States 
or foreign persons subject to U.S. jurisdiction involving defense 
articles or defense services of U.S. or foreign origin which are located 
inside or outside of the United States. But, this does not include 
activities by U.S. persons that are limited exclusively to U.S. domestic 
sales or transfers (e.g., not for export or re-transfer in the United 
States or a foreign person).
    (c) The term ``foreign defense article or defense service'' includes 
any non-United States defense article or defense service of a nature 
described on the United States Munitions List regardless of whether such 
article or service is of United States origin or whether such article or 
service contains United States origin components.



Sec. 129.3  Requirement to Register.

    (a) Any U.S. person, wherever located, and any foreign person 
located in the United States or otherwise subject to the jurisdiction of 
the United States (notwithstanding Sec. 120.1(c)), who engages in the 
business of brokering activities (as defined in this part) with respect 
to the manufacture, export, import, or transfer of any defense article 
or defense service subject to the controls of this subchapter (see 
Sec. 121) or any ``foreign defense article or defense service'' (as 
defined in Sec. 129.2) is required to register with the Office of 
Defense Trade Controls.
    (b) Exemptions. Registration under this section is not required for:
    (1) Employees of the United States Government acting in official 
capacity.
    (2) Employees of foreign governments or international organizations 
acting in official capacity.
    (3) Persons exclusively in the business of financing, transporting, 
or freight forwarding, whose business activities do not also include 
brokering defense articles or defense services. For example, air 
carriers and freight forwarders who merely transport or arrange 
transportation for licensed United States Munitions List items are not 
required to register, nor are banks or credit companies who merely 
provide commercially available lines or letters of credit to persons 
registered in accordance with Part 122 of this subchapter required to 
register. However, banks, firms, or other persons providing financing 
for defense articles or defense services would be required to register 
under certain circumstances, such as where the bank or its employees are 
directly involved in arranging arms deals as defined in Sec. 129.2(a) or 
hold title to defense articles, even when no physical custody of defense 
articles is involved.



Sec. 129.4  Registration statement and fees.

    (a) General. The Department of State Form DSP-9 (Registration 
Statement) and a transmittal letter meeting the requirements of 
Sec. 122.2(b) of this subchapter must be submitted by an intended 
registrant with a payment by check or money order payable to the 
Department of State of one of the fees prescribed in Sec. 122.3(a) of 
this subchapter. The Registration Statement and transmittal letter must 
be signed by a senior officer who has been empowered by the intended 
registrant to sign such documents. The intended registrant shall also 
submit documentation that demonstrates that it is incorporated or 
otherwise authorized to do business in the United States.
    (b) A person required to register under this part who is already 
registered as a manufacturer or exporter in accordance with part 122 of 
this subchapter must also provide notification of this additional 
activity by submitting to the Office of Defense Trade Controls by 
registered mail a transmittal letter meeting the requirements of 
Sec. 122.2(b) and citing the existing registration, and must pay an 
additional fee according to the schedule prescribed in Sec. 122.3(a). 
Any person who registers coincidentally as a broker as defined in 
Sec. 129.2 of this subchapter and as a manufacturer or exporter must 
submit a Registration Statement that reflects the brokering activities, 
the Sec. 122.2(b) transmittal letter, as well as the additional fee for 
registration as a broker.
    (c) Other provisions of part 122, in particular, Sec. 122.4 
concerning notification of changes in information furnished by 
registrants and Sec. 122.5 concerning maintenance of records by 
registrants, apply equally to registration under this part (part 129).

[[Page 404]]



Sec. 129.5  Policy on embargoes and other proscriptions.

    (a) The policy and procedures set forth in this subparagraph apply 
to brokering activities defined in Sec. 129.2 of this subchapter, 
regardless of whether the persons involved in such activities have 
registered or are required to register under Sec. 129.3 of this 
subchapter.
    (b) No brokering activities or brokering proposals involving any 
country referred to in Sec. 126.1 of this subchapter may be carried out 
by any person without first obtaining the written approval of the Office 
of Defense Trade Controls.
    (c) No brokering activities or proposal to engage in brokering 
activities may be carried out or pursued by any person without the prior 
written approval of the Office of Defense Trade Controls in the case of 
other countries or persons identified from time to time by the 
Department of State through notice in the Federal Register, with respect 
to which certain limitations on defense articles or defense services are 
imposed for reasons of U.S. national security or foreign policy (e.g., 
Cyprus, Guatemala, Yemen) or law enforcement interests (e.g., an 
individual subject to debarment pursuant to Sec. 127.7 of this 
subchapter).
    (d) No brokering activities or brokering proposal may be carried out 
with respect to countries which are subject to United Nations Security 
Council arms embargo (see also Sec. 121.1(c)).
    (e) In cases involving countries or persons subject to paragraph 
(b), (c), or (d), above, it is the policy of the Department of State to 
deny requests for approval, and exceptions may be granted only rarely, 
if ever. Any person who knows or has reason to know of brokering 
activities involving such countries or persons must immediately inform 
the Office of Defense Trade Controls.



Sec. 129.6  Requirement for License/Approval.

    (a) No person may engage in the business of brokering activities 
without the prior written approval (license) of, or prior notification 
to, the Office of Defense Trade Controls, except as follows:
    (b) A license will not be required for:
    (1) Brokering activities undertaken by or for an agency of the 
United States Government--
    (i) for use by an agency of the United States Government; or
    (ii) for carrying out any foreign assistance or sales program 
authorized by law and subject to the control of the President by other 
means.
    (2) Brokering activities that are arranged wholly within and 
destined exclusively for the North Atlantic Treaty Organization, any 
member country of that Organization, Japan, Australia, or New Zealand, 
except in the case of the defense articles or defense services specified 
in Sec. 129.7(a) of this subchapter, for which prior approval is always 
required.



Sec. 129.7  Prior Approval (License).

    (a) The following brokering activities require the prior written 
approval of the Office of Defense Trade Controls:
    (1) Brokering activities pertaining to certain defense articles (or 
associated defense services) covered by or of a nature described by Part 
121, to or from any country, as follows:
    (i) Fully automatic firearms and components and parts therefor;
    (ii) Nuclear weapons strategic delivery systems and all components, 
parts, accessories, attachments specifically designed for such systems 
and associated equipment;
    (iii) Nuclear weapons design and test equipment of a nature 
described by Category XVI of Part 121;
    (iv) Naval nuclear propulsion equipment of a nature described by 
Category VI(e);
    (v) Missile Technology Control Regime Category I items 
(Sec. 121.16);
    (vi) Classified defense articles, services and technical data;
    (vii) Foreign defense articles or defense services (other than those 
that are arranged wholly within and destined exclusively for the North 
Atlantic Treaty Organization, Japan, Australia, or New Zealand (see 
Secs. 129.6(b)(2) and 129.7(a)).
    (2) Brokering activities involving defense articles or defense 
services covered by, or of a nature described by, Part 121, in addition 
to those specified

[[Page 405]]

in Sec. 129.7(a), that are designated as significant military equipment 
under this subchapter, for or from any country not a member of the North 
Atlantic Treaty Organization, Australia, New Zealand, or Japan whenever 
any of the following factors are present:
    (i) The value of the significant military equipment is $1,000,000 or 
more;
    (ii) The identical significant military equipment has not been 
previously licensed for export to the armed forces of the country 
concerned under this subchapter or approved for sale under the Foreign 
Military Sales Program of the Department of Defense;
    (iii) Significant military equipment would be manufactured abroad as 
a result of the articles or services being brokered; or
    (iv) The recipient or end user is not a foreign government or 
international organization.
    (b) The requirements of this section for prior written approval are 
met by any of the following:
    (1) A license or other written approval issued under parts 123, 124, 
or 125 of this subchapter for the permanent or temporary export or 
temporary import of the particular defense article, defense service or 
technical data subject to prior approval under this section, provided 
the names of all brokers have been identified in an attachment 
accompanying submission of the initial application; or
    (2) A written statement from the Office of Defense Trade Controls 
approving the proposed activity or the making of a proposal or 
presentation.
    (c) Requests for approval of brokering activities shall be submitted 
in writing to the Office of Defense Trade Controls by an empowered 
official of the registered broker; the letter shall also meet the 
requirements of Sec. 126.13 of this subchapter.
    (d) The request shall identify all parties involved in the proposed 
transaction and their roles, as well as outline in detail the defense 
article and related technical data (including manufacturer, military 
designation and model number), quantity and value, the security 
classification, if any, of the articles and related technical data, the 
country or countries involved, and the specific end use and end user(s).
    (e) The procedures outlined in Sec. 126.8(c) through (g) are equally 
applicable with respect to this section.



Sec. 129.8  Prior Notification.

    (a) Prior notification to the Office of Defense Trade Controls is 
required for brokering activities with respect to significant military 
equipment valued at less than $1,000,000, except for sharing of basic 
marketing information (e.g., information that does not include 
performance characteristics, price and probable availability for 
delivery) by U.S. persons registered as exporters under Part 122.
    (b) The requirement of this section for prior notification is met by 
informing the Office of Defense Trade Controls by letter at least 30 
days before making a brokering proposal or presentation. The Office of 
Defense Trade Controls will provide written acknowledgment of such prior 
notification to confirm compliance with this requirement and the 
commencement of the 30-day notification period.
    (c) The procedures outlined in Sec. 126.8(c) through (g) are equally 
applicable with respect to this section.



Sec. 129.9  Reports.

    (a) Any person required to register under this part shall provide 
annually a report to the Office of Defense Trade Controls enumerating 
and describing its brokering activities by quantity, type, U.S. dollar 
value, and purchaser(s) and recipient(s), license(s) numbers for 
approved activities and any exemptions utilized for other covered 
activities.



Sec. 129.10  Guidance.

    (a) Any person desiring guidance on issues related to this part, 
such as whether an activity is a brokering activity within the scope of 
this Part, or whether a prior approval or notification requirement 
applies, may seek guidance in writing from the Office of Defense Trade 
Controls. The procedures and conditions stated in Sec. 126.9 apply 
equally to requests under this section.

[[Page 406]]



PART 130--POLITICAL CONTRIBUTIONS, FEES AND COMMISSIONS--Table of Contents




Sec.
130.1  Purpose.
130.2  Applicant.
130.3  Armed forces.
130.4  Defense articles and defense services.
130.5  Fee or commission.
130.6  Political contribution.
130.7  Supplier.
130.8  Vendor.
130.9  Obligation to furnish information to the Office of Defense Trade 
          Controls.
130.10  Information to be furnished by applicant or supplier to the 
          Office of Defense Trade Controls.
130.11  Supplementary reports.
130.12  Information to be furnished by vendor to applicant or supplier.
130.13  Information to be furnished to applicant, supplier or vendor by 
          a recipient of a fee or commission.
130.14  Recordkeeping.
130.15  Confidential business information.
130.16  Other reporting requirements.
130.17  Utilization of and access to reports and records.

    Authority:  Sec. 39, Arms Export Control Act, 90 Stat. 767 (22 
U.S.C. 2779); E.O. 11958, 42 FR 4311, 3 CFR, 1977 Comp. p.79; 22 U.S.C. 
2658.

    Source:  58 FR 39323, July 22, 1993, unless otherwise noted.



Sec. 130.1  Purpose.

    Section 39(a) of the Arms Export Control Act (22 U.S.C. 2779) 
provides that the Secretary of State shall prescribe regulations with 
respect to reporting on certain payments relating to sales of defense 
articles and defense services. The provisions of this part implement 
that requirement. Definitions which apply to this part are contained in 
Secs. 130.2 through 130.8.



Sec. 130.2  Applicant.

    Applicant means any person who applies to the Office of Defense 
Trade Controls for any license or approval required under this 
subchapter for the export of defense articles or defense services valued 
in an amount of $500,000 or more which are being sold commercially to or 
for the use of the armed forces of a foreign country or international 
organization. This term also includes a person to whom the required 
license or approval has been given.



Sec. 130.3  Armed forces.

    Armed forces means the army, navy, marine, air force, or coast 
guard, as well as the national guard and national police, of a foreign 
country. This term also includes any military unit or military personnel 
organized under or assigned to an international organization.



Sec. 130.4  Defense articles and defense services.

    Defense articles and defense services have the meaning given those 
terms in paragraphs (3), (4) and (7) of section 47 of the Arms Export 
Control Act (22 U.S.C. 2794 (3), (4), and (7)). When used with reference 
to commercial sales, the definitions in Secs. 120.6 and 120.9 of this 
subchapter apply.



Sec. 130.5  Fee or commission.

    (a) Fee or commission means, except as provided in paragraph (b) of 
this section, any loan, gift, donation or other payment of $1,000 or 
more made, or offered or agreed to be made directly or indirectly, 
whether in cash or in kind, and whether or not pursuant to a written 
contract, which is:
    (1) To or at the direction of any person, irrespective of 
nationality, whether or not employed by or affiliated with an applicant, 
a supplier or a vendor; and
    (2) For the solicitation or promotion or otherwise to secure the 
conclusion of a sale of defense articles or defense services to or for 
the use of the armed forces of a foreign country or international 
organization.
    (b) The term fee or commission does not include:
    (1) A political contribution or a payment excluded by Sec. 130.6 
from the definition of political contribution:
    (2) A normal salary (excluding contingent compensation) established 
at an annual rate and paid to a regular employee of an applicant, 
supplier or vendor;
    (3) General advertising or promotional expenses not directed to any 
particular sale or purchaser; or
    (4) Payments made, or offered or agreed to be made, solely for the 
purchase by an applicant, supplier or vendor of specific goods or 
technical, operational or advisory services, which

[[Page 407]]

payments are not disproportionate in amount with the value of the 
specific goods or services actually furnished.



Sec. 130.6  Political contribution.

    Political contribution means any loan, gift, donation or other 
payment of $1,000 or more made, or offered or agreed to be made, 
directly or indirectly, whether in cash or in kind, which is:
    (a) To or for the benefit of, or at the direction of, any foreign 
candidate, committee, political party, political faction, or government 
or governmental subdivision, or any individual elected, appointed or 
otherwise designated as an employee or officer thereof; and
    (b) For the solicitation or promotion or otherwise to secure the 
conclusion of a sale of defense articles or defense services to or for 
the use of the armed forces of a foreign country or international 
organization. Taxes, customs duties, license fees, and other charges 
required to be paid by applicable law or regulation are not regarded as 
political contributions.



Sec. 130.7  Supplier.

    Supplier means any person who enters into a contract with the 
Department of Defense for the sale of defense articles or defense 
services valued in an amount of $500,000 or more under section 22 of the 
Arms Export Control Act (22 U.S.C. 2762).



Sec. 130.8  Vendor.

    (a) Vendor means any distributor or manufacturer who, directly or 
indirectly, furnishes to an applicant or supplier defense articles 
valued in an amount of $500,000 or more which are end-items or major 
components as defined in Sec. 121.8 of this subchapter. It also means 
any person who, directly or indirectly, furnishes to an applicant or 
supplier defense articles or services valued in an amount of $500,000 or 
more when such articles or services are to be delivered (or incorporated 
in defense articles or defense services to be delivered) to or for the 
use of the armed forces of a foreign country or international 
organization under:
    (1) A sale requiring a license or approval from the Office of 
Defense Trade Controls under this subchapter; or
    (2) A sale pursuant to a contract with the Department of Defense 
under section 22 of the Arms Export Control Act (22 U.S.C. 2762).
    (b) [Reserved]



Sec. 130.9  Obligation to furnish information to the Office of Defense Trade Controls.

    (a)(1) Each applicant must inform the Office of Defense Trade 
Controls as to whether applicant or its vendors have paid, or offered or 
agreed to pay, in respect of any sale for which a license or approval is 
requested:
    (i) Political contributions in an aggregate amount of $5,000 or 
more, or
    (ii) Fees or commissions in an aggregate amount of $100,000 or more.

If so, applicant must furnish to the Office of Defense Trade Controls 
the information specified in Sec. 130.10. The furnishing of such 
information or an explanation satisfactory to the Director of the Office 
of Defense Trade Controls as to why all the information cannot be 
furnished at that time is a condition precedent to the granting of the 
relevant license or approval.
    (2) The requirements of this paragraph do not apply in the case of 
an application with respect to a sale for which all the information 
specified in Sec. 130.10 which is required by this section to be 
reported shall already have been furnished.
    (b) Each supplier must inform the Office of Defense Trade Controls 
as to whether the supplier or its vendors have paid, or offered or 
agreed to pay, in respect of any sale:
    (1) Political contributions in an aggregate amount of $5,000 or 
more, or
    (2) Fees or commissions in an aggregate amount of $100,000 or more.

If so, supplier must furnish to the Office of Defense Trade Controls the 
information specified in Sec. 130.10. The information required to be 
furnished pursuant to this paragraph must be so furnished no later than 
30 days after the contract award to such supplier, or such earlier date 
as may be specified by the Department of Defense. For purposes of this 
paragraph, a contract

[[Page 408]]

award includes a purchase order, exercise of an option, or other 
procurement action requiring a supplier to furnish defense articles or 
defense services to the Department of Defense for the purposes of 
section 22 of the Arms Export Control Act (22 U.S.C. 2762).
    (c) In determining whether an applicant or its vendors, or a 
supplier or its vendors, as the case may be, have paid, or offered or 
agreed to pay, political contributions in an aggregate amount of $5,000 
or more in respect of any sale so as to require a report under this 
section, there must be included in the computation of such aggregate 
amount any political contributions in respect of the sale which are paid 
by or on behalf of, or at the direction of, any person to whom the 
applicant, supplier or vendor has paid, or offered or agreed to pay, a 
fee or commission in respect of the sale. Any such political 
contributions are deemed for purposes of this part to be political 
contributions by the applicant, supplier or vendor who paid or offered 
or agreed to pay the fee or commission.
    (d) Any applicant or supplier which has informed the Office of 
Defense Trade Controls under this section that neither it nor its 
vendors have paid, or offered or agreed to pay, political contributions 
or fees or commissions in an aggregate amount requiring the information 
specified in Sec. 130.10 to be furnished, must subsequently furnish such 
information within 30 days after learning that it or its vendors had 
paid, or offered or agreed to pay, political contributions or fees or 
commissions in respect of a sale in an aggregate amount which, if known 
to applicant or supplier at the time of its previous communication with 
the Office of Defense Trade Controls, would have required the furnishing 
of information under Sec. 130.10 at that time. Any report furnished 
under this paragraph must, in addition to the information specified in 
Sec. 130.10, include a detailed statement of the reasons why applicant 
or supplier did not furnish the information at the time specified in 
paragraph (a) or paragraph (b) of this section, as applicable.



Sec. 130.10  Information to be furnished by applicant or supplier to the Office of Defense Trade Controls.

    (a) Every person required under Sec. 130.9 to furnish information 
specified in this section in respect to any sale must furnish to the 
Office of Defense Trade Controls:
    (1) The total contract price of the sale to the foreign purchaser;
    (2) The name, nationality, address and principal place of business 
of the applicant or supplier, as the case may be, and, if applicable, 
the employer and title;
    (3) The name, nationality, address and principal place of business, 
and if applicable, employer and title of each foreign purchaser, 
including the ultimate end-user involved in the sale;
    (4) Except as provided in paragraph (c) of this section, a statement 
setting forth with respect to such sale:
    (i) The amount of each political contribution paid, or offered or 
agreed to be paid, or the amount of each fee or commission paid, or 
offered or agreed to be paid;
    (ii) The date or dates on which each reported amount was paid, or 
offered or agreed to be paid;
    (iii) The recipient of each such amount paid, or intended recipient 
if not yet paid;
    (iv) The person who paid, or offered or agreed to pay such amount; 
and
    (v) The aggregate amounts of political contributions and of fees or 
commission, respectively, which shall have been reported.
    (b) In responding to paragraph (a)(4) of this section, the statement 
must:
    (1) With respect to each payment reported, state whether such 
payment was in cash or in kind. If in kind, it must include a 
description and valuation thereof. Where precise amounts are not 
available because a payment has not yet been made, an estimate of the 
amount offered or agreed to be paid must be provided;
    (2) With respect to each recipient, state:
    (i) Its name;
    (ii) Its nationality;
    (iii) Its address and principal place of business;
    (iv) Its employer and title; and

[[Page 409]]

    (v) Its relationship, if any, to applicant, supplier, or vendor, and 
to any foreign purchaser or end-user.
    (c) In submitting a report required by Sec. 130.9, the detailed 
information specified in paragraph (a)(4) and (b) of this section need 
not be included if the payments do not exceed:
    (1) $2,500 in the case of political contributions; and
    (2) $50,000 in the case of fees or commissions.

In lieu of reporting detailed information with respect to such payments, 
the aggregate amount thereof must be reported, identified as 
miscellaneous political contributions or miscellaneous fees or 
commissions, as the case may be.
    (d) Every person required to furnish the information specified in 
paragraphs (a) and (b) of this section must respond fully to each 
subdivision of those paragraphs and, where the correct response is none 
or not applicable,'' must so state.



Sec. 130.11  Supplementary reports.

    (a) Every applicant or supplier who is required under Sec. 130.9 to 
furnish the information specified in Sec. 130.10 must submit a 
supplementary report in connection with each sale in respect of which 
applicant or supplier has previously been required to furnish 
information if:
    (1) Any political contributions aggregating $2,500 or more or fees 
or commissions aggregating $50,000 or more not previously reported or 
paid, or offered or agreed to be paid by applicant or supplier or any 
vendor;
    (2) Subsequent developments cause the information initially reported 
to be no longer accurate or complete (as in the case where a payment 
actually made is substantially different in amount from a previously 
reported estimate of an amount offered or agreed to be paid); or
    (3) Additional details are requested by the Office of Defense Trade 
Controls with respect to any miscellaneous payments reported under 
Sec. 130.10(c).
    (b) Supplementary reports must be sent to the Office of Defense 
Trade Controls within 30 days after the payment, offer or agreement 
reported therein or, when requested by the Office of Defense Trade 
Controls, within 30 days after such request, and must include:
    (1) Any information specified in Sec. 130.10 required or requested 
to be reported and which was not previously reported; and
    (2) The Defense Trade Control license number, if any, and the 
Department or Defense contract number, if any, related to the sale.



Sec. 130.12  Information to be furnished by vendor to applicant or supplier.

    (a) In order to determine whether it is obliged under Sec. 130.9 to 
furnish the information specified in Sec. 130.10 with respect to a sale, 
every applicant or supplier must obtain from each vendor, from or 
through whom the applicant acquired defense articles or defense services 
forming the whole or a part of the sale, a full disclosure by the vendor 
of all political contributions or fees or commission paid, by vendor 
with respect to such sale. Such disclosure must include responses to all 
the information pertaining to vendor required to enable applicant or 
supplier, as the case may be, to comply fully with Secs. 130.9 and 
130.10. If so required, they must include the information furnished by 
each vendor in providing the information specified.
    (b) Any vendor which has been requested by an applicant or supplier 
to furnish an initial statement under paragraph (a) of this section 
must, except as provided in paragraph (c) of this section, furnish such 
statement in a timely manner and not later than 20 days after receipt of 
such request.
    (c) If the vendor believes that furnishing information to an 
applicant or supplier in a requested statement would unreasonably risk 
injury to the vendor's commercial interests, the vendor may furnish in 
lieu of the statement an abbreviated statement disclosing only the 
aggregate amount of all political contributions and the aggregate amount 
of all fees or commissions which have been paid, or offered or agreed to 
be paid, or offered or agreed to be paid, by the vendor with respect to 
the sale. Any abbreviated statement furnished to an applicant or 
supplier under this paragraph must be accompanied by a certification 
that the requested information has been reported

[[Page 410]]

by the vendor directly to the Office of Defense Trade Controls. The 
vendor must simultaneously report fully to the Office of Defense Trade 
Controls all information which the vendor would otherwise have been 
required to report to the applicant or supplier under this section. Each 
such report must clearly identify the sale with respect to which the 
reported information pertains.
    (d)(1) If upon the 25th day after the date of its request to vendor, 
an applicant or supplier has not received from the vendor the initial 
statement required by paragraph (a) of this section, the applicant or 
supplier must submit to the Office of Defense Trade Controls a signed 
statement attesting to:
    (i) The manner and extent of applicant's or supplier's attempt to 
obtain from the vendor the initial statement required under paragraph 
(a) of this section;
    (ii) Vendor's failure to comply with this section; and
    (iii) The amount of time which has elapsed between the date of 
applicant's or supplier's request and the date of the signed statement;
    (2) The failure of a vendor to comply with this section does not 
relieve any applicant or supplier otherwise required by Sec. 130.9 to 
submit a report to the Office of Defense Trade Controls from submitting 
such a report.



Sec. 130.13  Information to be furnished to applicant, supplier or vendor by a recipient of a fee or commission.

    (a) Every applicant or supplier, and each vendor thereof;
    (1) In order to determine whether it is obliged under Sec. 130.9 or 
Sec. 130.12 to furnish information specified in Sec. 130.10 with respect 
to a sale; and
    (2) Prior to furnishing such information, must obtain from each 
person, if any, to whom it has paid, or offered or agreed to pay, a fee 
or commission in respect of such sale, a timely statement containing a 
full disclosure by such a person of all political contributions paid, or 
offered or agreed to be paid, by it or on its behalf, or at its 
direction, in respect of such sale. Such disclosure must include 
responses to all the information required to enable the applicant, 
supplier or vendor, as the case may be, to comply fully with 
Secs. 130.9, 130.10, and 130.12.
    (b) In obtaining information under paragraph (a) of this section, 
the applicant, supplier or vendor, as the case may be, must also require 
each person to whom a fee or commission is paid, or offered or agreed to 
be paid, to furnish from time to time such reports of its political 
contributions as may be necessary to enable the applicant, supplier or 
vendor, as the case may be, to comply fully with Secs. 130.9, 130.10, 
130.11, and 130.12.
    (c) The applicant supplier or vendor, as the case may be, must 
include any political contributions paid, or offered or agreed to be 
paid, by or on behalf of, or at the direction of, any person to whom it 
has paid, or offered or agreed to pay a fee or commission in determining 
whether applicant, supplier or vendor is required by Secs. 130.9, 
130.11, and 130.12 to furnish information specified in Sec. 130.10.



Sec. 130.14  Recordkeeping.

    Each applicant, supplier and vendor must maintain a record of any 
information it was required to furnish or obtain under this part and all 
records upon which its reports are based for a period of not less than 
five years following the date of the report to which they pertain.



Sec. 130.15  Confidential business information.

    (a) Any person who is required to furnish information under this 
part may identify any information furnished hereunder which the person 
considers to be confidential business information. No person, including 
any applicant or supplier, shall publish, divulge, disclose, or make 
known in any manner, any information so identified by a vendor or other 
person unless authorized by law or regulation.
    (b) For purposes of this section, confidential business information 
means commercial or financial information which by law is entitled to 
protection from disclosure. (See, e.g., 5 U.S.C. 552(b) (3) and (4); 18 
U.S.C. 1905; 22 U.S.C. 2778(e); Rule 26(c)(7), Federal Rules of Civil 
Procedure.)

[[Page 411]]



Sec. 130.16  Other reporting requirements.

    The submission of reports under this part does not relieve any 
person of any requirements to furnish information to any federal, state, 
or municipal agency, department or other instrumentality as required by 
law, regulation or contract.



Sec. 130.17  Utilization of and access to reports and records.

    (a) All information reported and records maintained under this part 
will be made available, upon request for utilization by standing 
committees of the Congress and subcommittees thereof, and by United 
States Government agencies, in accordance with section 39(d) of the Arms 
Export Control Act (22 U.S.C. 2779(d)), and reports based upon such 
information will be submitted to Congress in accordance with sections 
36(a)(8) and 36(b)(1) of that Act (22 U.S.C. 2776 (a)(8) and (b)(1)).
    (b) All confidential business information provided pursuant to this 
part shall be protected against disclosure to the extent provided by 
law.
    (c) Nothing in this section shall preclude the furnishing of 
information to foreign governments for law enforcement or regulatory 
purposes under international arrangements between the United States and 
any foreign government.

[[Page 412]]



                       SUBCHAPTER N--MISCELLANEOUS





PART 131--CERTIFICATES OF AUTHENTICATION--Table of Contents




Sec.
131.1  Certification of documents.
131.2  Refusal of certification for unlawful purpose.



Sec. 131.1  Certification of documents.

    The Authentication Officer, Acting Authentication Officer, or any 
Assistant Authentication Officer designated by either of the former 
officers may, and is hereby authorized to, sign and issue certificates 
of authentication under the seal of the Department of State for and in 
the name of the Secretary of State or the Acting Secretary of State. The 
form of authentication shall be as follows:

    In testimony whereof, I, ____________________, Secretary of State 
have hereunto caused the seal of the Department of State to be affixed 
and my name subscribed by the Authentication Officer, Acting 
Authentication Officer, or an Assistant Authentication Officer, of the 
said Department, at________. in ____________, this ________ day of 
________________ 19______

                                                    (Secretary of State)

 By_____________________________________________________________________

      (____________________ Authentication Officer, Department of State)

(22 U.S.C. 2651a)
[61 FR 39585, July 30, 1996]



Sec. 131.2  Refusal of certification for unlawful purpose.

    (a) The Department will not certify to a document when it has good 
reason to believe that the certification is desired for an unlawful or 
improper purpose. It is therefore the duty of the Authentication Officer 
to examine not only the document which the Deparment is asked to 
authenticate, but also the fundamental document to which previous seals 
or other certifications may have been affixed by other authorities. The 
Authentication Officer shall request such additional information as may 
be necessary to establish that the requested authentication will serve 
the interests of justice and is not contrary to public policy.
    (b) In accordance with section 3, paragraph 5 of the Export 
Administration Act of 1969 (83 Stat. 841, Pub. L. 91-184) approved 
December 30, 1969, documents which have the effect of furthering or 
supporting the restrictive trade practices or boycotts fostered or 
imposed by foreign countries against countries friendly to the United 
States shall be considered contrary to public policy for purposes of 
these regulations.

(R.S. 203. sec. 4, 63 Stat. 111, as amended, sec. 1733, 62 Stat. 946, 
secs. 104, 332, 66 Stat. 174, 252; 22 U.S.C. 2657, 2658, 28 U.S.C. 1733, 
8 U.S.C. 1104, 1443)
[22 FR 10882, Dec. 27, 1957, as amended at 30 FR 12732, Oct. 6, 1965; 
Dept. Reg. 108.621, 35 FR 8887, June 9, 1970]



PART 132--BOOKS, MAPS, NEWSPAPERS, ETC.--Table of Contents






Sec. 132.1  Purchase.

    The purchase by the Department of State of books, maps, newspapers, 
periodicals, and other publications shall be made without regard to the 
provisions of the act approved March 3, 1933 (sec. 2, 47 Stat. 1520; 41 
U.S.C. 10a), since determination has been made by the Secretary, as 
permitted by the provisions of the act, that such purchase is 
inconsistent with the public interest.

(80 Stat. 379; 5 U.S.C. 301)
[22 FR 10883, Dec. 27, 1957]



PART 134--EQUAL ACCESS TO JUSTICE ACT; IMPLEMENTATION--Table of Contents




                      Subpart A--General Provisions

Sec.
134.1  Purpose of these rules.
134.2  When the Act applies.
134.3  Proceedings covered.
134.4  Eligibility of applicants.
134.5  Standard for awards.
134.6  Allowable fees and expenses.
134.7  Rulemaking on maximum rates for attorney fees.
134.8  Official authorized to take final action under the Act.

[[Page 413]]

             Subpart B--Information Required From Applicants

134.11  Contents of application.
134.12  Net worth exhibit.
134.13  Documentation of fees and expenses.
134.14  When application may be filed.

           Subpart C--Procedures for Considering Applications

134.21  Filing and service of documents.
134.22  Answer to application.
134.23  Reply.
134.24  Comments by other parties.
134.25  Settlement.
134.26  Further proceedings.
134.27  Decision.
134.28  Further Department of State review.
134.29  Judicial review.
134.30  Payment of award.

    Authority:  Sec. 203(a)(1), Pub. L. 96-481, 94 Stat. 2325 (5 U.S.C. 
504(c)(1)).

    Source:  46 FR 58301, Dec. 1, 1981, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 134.1  Purpose of these rules.

    The Equal Access to Justice Act, 5 U.S.C. 504 (called ``the Act'' in 
this part), provides for the award of attorney fees and other expenses 
to eligible individuals and entities who are parties to certain 
administrative proceedings (called ``adversary adjudications'') before 
the Department of State. An eligible party may receive an award when it 
prevails over the Department of State, unless the Department of State's 
position in the proceeding was substantially justified or special 
circumstances make an award unjust. The rules in this part describe the 
parties eligible for awards and the proceedings that are covered. They 
also explain how to apply for awards, and the procedures and standards 
that the Department will observe to make them.



Sec. 134.2  When the Act applies.

    The Act applies to any adversary adjudication pending before the 
Department of State at any time between October 1, 1981 and September 
30, 1984. This includes proceedings begun before October 1, 1981 if 
final agency action has not been taken before that date, and proceedings 
pending on September 30, 1984, regardless of when they were initiated or 
when final agency action occurs.



Sec. 134.3  Proceedings covered.

    (a) The Act applies to adversary adjudications conducted by the 
Department of State. These are adjudications under 5 U.S.C. 554 in which 
the position of the Department of State is presented by an attorney or 
other representative who enters an appearance and participates in the 
proceeding. For the Department of State, the type of proceeding covered 
are proceedings relative to controlling export of defense articles 
through administrative sanctions pursuant to 22 U.S.C. 2778 and 50 
U.S.C. App. 2410 (c)(2)(B).
    (b) The Department of State may also designate a proceeding not 
listed in paragraph (a) of this section as an adversary adjudication for 
purposes of the Act by so stating in an order initiating the proceeding 
or designating the matter for hearing. The failure to designate a 
proceeding as an adversary adjudication shall not preclude the filing of 
an application by a party who believes the proceeding is covered by the 
Act; whether the proceeding is covered will then be an issue for 
resolution in proceedings on the application.
    (c) If a proceeding includes matters covered by the Act and matters 
specifically excluded from coverage, any award made will include only 
fees and expenses related to covered issues.



Sec. 134.4  Eligibility of applicants.

    (a) To be eligible for an award of attorney fees and other expenses 
under the Act, the applicant must be a party to the adversary 
adjudication for which it seeks an award. The term ``party'' is defined 
in 5 U.S.C. 551(3). The applicant must show by clear and convincing 
evidence that it meets all conditions of eligibility set out in this 
subpart and in subpart B and must submit additional information to 
verify its eligibility upon order by the adjudicative officer.
    (b) The types of eligible applicants are as follows:
    (1) An individual with a net worth of not more than $1 million;
    (2) The sole owner of an unincorporated business who has a net worth 
of not more than $5 million, including

[[Page 414]]

both personal and business interests, and not more than 500 employees;
    (3) A charitable or other tax-exempt organization described in 
section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) 
with not more than 500 employees;
    (4) A cooperative association as defined in section 15(a) of the 
Agricultural Marketing Act (12 U.S.C. 1141j(a)) with not more than 500 
employees; and
    (5) Any other partnership, corporation, association, or public or 
private organization with a net worth of not more than $5 million and 
not more than 500 employees.
    (c) For the purpose of eligibility, the net worth and number of 
employees of an applicant shall be determined as of the date the 
proceeding was initiated.
    (d) An applicant who owns an unincorporated business will be 
considered as an ``individual'' rather than a ``sole owner of an 
unincorporated business'' if the issues on which the applicant prevails 
are related primarily to personal interests rather than to business 
interests.
    (e) The employees of an applicant include all persons who regularly 
perform services for remuneration for the applicant, under the 
applicant's direction and control. Part-time employees shall be included 
on a proportional basis.
    (f) The net worth and number of employees of the applicant and all 
of its affiliates shall be aggregated to determine eligibility. Any 
individual, corporation or other entity that directly or indirectly 
controls or owns a majority of the voting shares or other interest of 
the applicant, or any corporation or other entity of which the applicant 
directly or indirectly owns or controls a majority of the voting shares 
or other interest, will be considered an affiliate for purposes of this 
part, unless the adjudicative officer determines that such treatment 
would be unjust and contrary to the purposes of the Act in light of the 
actual relationship between the affiliated entities. In addition, the 
adjudicative officer may determine that financial relationships of the 
applicant other than those described in this paragraph constitute 
special circumstances that would make an award unjust.
    (g) An applicant that participates in a proceeding primarily on 
behalf of one or more other persons or entities that would be ineligible 
is not itself eligible for an award.



Sec. 134.5  Standard for awards.

    (a) A prevailing applicant may receive an award for fees and 
expenses incurred in connection with a proceeding, or in a significant 
and discrete substantive portion of the proceeding, unless the position 
of the agency over which the applicant has prevailed was substantially 
justified. The burden of proof that an award should not be made to an 
eligible prevailing applicant is on the Department of State which may 
avoid an award by showing that its position was reasonable in law and 
fact.
    (b) An award will be reduced or denied if the applicant has unduly 
or unreasonably protracted the proceeding or if special circumstances 
make the award sought unjust.



Sec. 134.6  Allowable fees and expenses.

    (a) Awards will be based on rates customarily charged by persons 
engaged in the business of acting as attorneys, agents and expert 
witnesses, even if the services were made available without charge or at 
a reduced rate to the applicant.
    (b) No award for the fee of an attorney or agent under these rules 
may exceed $75.00 per hour. No award to compensate an expert witness may 
exceed the highest rate at which the Department of State pays expert 
witnesses, which is generally $50.00 per hour. However, an award may 
also include the reasonable expenses of the attorney, agent or witness 
as a separate item, if the attorney, agent or witness ordinarily charges 
clients separately for such expenses.
    (c) In determining the reasonableness of the fee sought for an 
attorney, agent or expert witness, the adjudicative officer shall 
consider the following:
    (1) If the attorney, agent or witness is in private practice, his or 
her customary fee for similar services, or, if an employee of the 
applicant, the fully allocated cost of the services;
    (2) The prevailing rate for similar services in the community in 
which the

[[Page 415]]

attorney, agent or witness ordinarily performs services;
    (3) The time actually spent in the representation of the applicant;
    (4) the time reasonably spent in light of the difficulty or 
complexity of the issues in the proceeding; and
    (5) Such other factors as may bear on the value of the services 
provided.
    (d) The reasonable cost of any study, analysis, engineering report, 
test, project or similar matter prepared on behalf of a party may be 
awarded, to the extent that the charge for the service does not exceed 
the prevailing rate for similar services, and the study or other matter 
was necessary for preparation of applicant's case.



Sec. 134.7  Rulemaking on maximum rates for attorney fees.

    (a) If warranted by an increase in the cost of living or by special 
circumstances (such as limited availability of attorneys qualified to 
handle certain types of proceedings), the Department of State may adopt 
regulations providing that attorney fees may be awarded at a rate higher 
than $75 per hour in some or all of the types of proceedings covered by 
this part. The Department of State will conduct any rulemaking 
proceedings for this purpose under the informal rulemaking procedures of 
the Administrative Procedure Act.
    (b) Any person may request the Department of State to initiate a 
rulemaking proceeding to increase the maximum rate for attorney fees. 
The request should identify the rate the person believes the Department 
of State should establish and the types of proceedings in which the rate 
should be used. It should also explain fully the reasons why the higher 
rate is warranted. The Department of State will respond to the request 
within 60 days after it is filed, by determining to initiate a 
rulemaking proceeding, denying the request, or taking other appropriate 
action.



Sec. 134.8  Official authorized to take final action under the Act.

    The Department of State official who renders the final agency 
decision in a covered proceeding is authorized to take final action on 
matters pertaining to the Equal Access to Justice Act as applied to the 
proceeding.



             Subpart B--Information Required From Applicants



Sec. 134.11  Contents of application.

    (a) An application for an award of fees and expenses under the Act 
shall identify the applicant and the proceeding for which an award is 
sought. The application shall show that the applicant has prevailed and 
identify the position of the Department of State in the proceeding that 
the applicant alleges was not substantially justified. Unless the 
applicant is an individual, the application shall also state the number 
of employees of the applicant and describe briefly the type and purpose 
of its organization or business.
    (b) The application shall also include a statement that the 
applicant's net worth does not exceed $1 million (if an individual) or 
$5 million (for all other applicants, including their affiliates). 
However, an applicant may omit this statement if:
    (1) It attaches a copy of a ruling by the Internal Revenue Service 
that it qualifies as an organization described in section 501(c)(3) of 
the Internal Revenue Code (26 U.S.C. 501(c)(3)) or, in the case of a 
tax-exempt organization not required to obtain a ruling from the 
Internal Revenue Service on its exempt status, a statement that 
describes the basis for the applicant's belief that it qualfies under 
such section; or
    (2) It states on the application that it is a cooperative 
association as defined in section 15(a) of the Agricultural Marketing 
Act (12 U.S.C. 1141j(a)).
    (c) The application shall state the amount of fees and expenses for 
which an award is sought.
    (d) The application may also include any other matters that the 
applicant wishes the Department of State to consider in determining 
whether and in what amount an award should be made.
    (e) The application shall be signed by the applicant or an 
authorized officer or attorney of the applicant. It shall also contain 
or be accompanied by a written verification under oath or under penalty 
of prejury that the information provided in the application is true and 
correct.

[[Page 416]]



Sec. 134.12  Net worth exhibit.

    (a) Each applicant except a qualifed tax-exempt organization or 
cooperative association must provide with its application a detailed 
exhibit showing the net worth of the applicant and any affiliates (as 
defined in Sec. 960.4(f)) when the proceeding was initiated. The exhibit 
may be in any form convenient to the applicant that provides full 
disclosure of the applicant's and its affiliates' assets and liabilities 
and is sufficient to determine whether the applicant qualifies under the 
standards in his part. The adjudicative officer may require an applicant 
to file additional information to determine its eligibility for an 
award.
    (b) Ordinarily, the net worth exhibit will be included in the public 
record of the proceeding. However, an applicant that objects to public 
disclosure of information in any portion of the exhibit and believes 
there are legal grounds for withholding it from disclosure may submit 
that portion of the exhibit directly to the adjudicative officer in a 
sealed envelope labeled ``Confidential Financial Information'', 
accompanied by a motion to withhold the information from public 
disclosure. The motion shall describe the information sought to be 
withheld and explain, in detail, why it falls within one or more of the 
specific exemptions from mandatory disclosure under the Freedom of 
Information Act, 5 U.S.C. 551(b) (1)-(9), why public disclosure of the 
information would adversely affect the applicant, and why disclosure is 
not required in the public interest. The material in question shall be 
served on counsel representing the agency against which the applicant 
seeks an award, but need not be served on any other party to the 
proceeding. If the adjudicative officer finds that the information 
should not be withheld from disclosure, it shall be placed in the public 
record of the proceeding. Otherwise, any request to inspect or copy the 
exhibit shall be disposed of in accordance with the Department of State 
established procedures under the Freedom of Information Act, part 6 of 
this title.



Sec. 134.13  Documentation of fees and expenses.

    The application shall be accompanied by full documentation of the 
fees and expenses, including the cost of any study, analysis, 
engineering report, test project or similar matter, for which an award 
is sought. A separate itemized statement shall be submitted for each 
professional firm or individual whose services are covered by the 
application, showing the hours spent in connection with the proceeding 
by each individual, a description of the specific services performed, 
the rate at which each fee has been computed, any expenses for which 
reimbursement is sought, the total amount claimed, and the total amount 
paid or payable by the applicant or by any other person or entity for 
the services provided. The adjudicative officer may require the 
applicant to provide vouchers, receipts, or other substantiation for any 
expenses claimed.



Sec. 134.14  When application may be filed.

    (a) An application may be filed whenever the applicant has prevailed 
in the proceeding or in a significant and discrete substantive portion 
of the proceeding, but in no case later than 30 days after the 
Department of State's final disposition of the proceeding.
    (b) If review or reconsideration is sought or taken of a decision as 
to which an applicant believes it has prevailed, proceedings for the 
award of fees shall be stayed pending final disposition of the 
underlying controversy.
    (c) For purposes of this rule, final disposition means the later of 
(1) the date on which an initial decision or other recommended 
disposition of the merits of the proceeding by an adjudicative officer 
or intermediate review board becomes administratively final; (2) 
issuance of an order disposing of any petitions for reconsideration of 
the Department of State's final order in the proceeding; (3) if no 
petition for reconsideration is filed, the last date on which such a 
petition could have been filed; or (4) issuance of a final order or any 
other final resolution of a proceeding, such as a settlement or 
voluntary

[[Page 417]]

dismissal, which is not subject to a petition for reconsideration or to 
a petition for judicial review; or (5) completion of judicial action on 
the underlying controversy and any subsequent Department of State action 
pursuant to judicial mandate.



           Subpart C--Procedures for Considering Applications



Sec. 134.21  Filing and service of documents.

    Any application for an award or other pleading or document related 
to an application shall be filed and served on all parties to the 
proceeding in the same manner as other pleadings in the proceeding, 
except as provided in Sec. 134.12(b) for confidential financial 
information.



Sec. 134.22  Answer to application.

    (a) Within 30 days after service of an application, counsel 
representing the Department of State may file an answer to the 
application. Unless the Department of State counsel requests an 
extension of time for filing or files a statement of intent to negotiate 
under paragraph (b) of this section, failure to file an answer within 
the 30 day period may be treated as a consent to the award requested.
    (b) If the Department of State counsel and the applicant believe 
that the issues in the fee application can be settled, they may jointly 
file a statement of their intent to negotiate a settlement. The filing 
of this statement shall extend the time for filing an answer for an 
additional 30 days, and further extensions may be granted by the 
adjudicative officer upon request by Department of State counsel and the 
applicant.
    (c) The answer shall explain in detail any objections to the award 
requested and identify the facts relied on in support of the Department 
of State position. If the answer is based on any alleged facts not 
already in the record of the proceeding the Department of State shall 
include with the answer either supporting affidavits or a request for 
further proceedings under Sec. 134.26.



Sec. 134.23  Reply.

    Within 15 days after service of an answer, the applicant may file a 
reply. If the reply is based on any alleged facts not already in the 
record of the proceeding, the applicant shall include with the reply 
either supporting affidavits or a request for further proceedings under 
Sec. 134.26.



Sec. 134.24  Comments by other parties.

    Any party to a proceeding other than the applicant and Department of 
State may file comments on an application within 30 days after it is 
served or on an answer within 15 days after it is served. A commenting 
party may not participate further in proceedings on the application 
unless the adjudicative officer determines that the public interest 
requires such participation in order to permit full exploration of 
matters raised in the comment.



Sec. 134.25  Settlement.

    The applicant and the Department of State may agree on a proposed 
settlement of the award before final action on the application, either 
in connection with a settlement of the underlying proceeding, or after 
the underlying proceeding has been concluded. If a prevailing party and 
Department of State counsel agree on a proposed settlement of an award 
before an application has been filed, the application shall be filed 
with the proposed settlement.



Sec. 134.26  Further proceedings.

    (a) Ordinarily, the determination of an award will be made on the 
basis of the written record. However, on request of either the applicant 
or Department of State counsel, or on his or her own initiative, the 
adjudicative officer may order further proceedings, such as an informal 
conference, oral argument, additional written submissions, or an 
evidentiary hearing. Such further proceedings shall be held only when 
necessary for full and fair resolution of the issues arising from the 
application, and shall be conducted as promptly as possible.
    (b) A request that the adjudicative officer order further 
proceedings under this section shall specifically identify

[[Page 418]]

the information sought or the disputed issues and shall explain why the 
additional proceedings are necessary to resolve the issues.



Sec. 134.27  Decision.

    The adjudicative officer shall issue an initial decision on the 
application as promptly as possible after completion of proceedings on 
the application. The decision shall include written fundings and 
conclusions on the applicant's eligibility and status as a prevailing 
party, and an explanation of the reasons for any difference between the 
amount requested and the amount awarded. The decision shall also 
include, if at issue, findings on whether the Department of State 
position was substantially justified, whether the applicant unduly 
protracted the proceedings, or whether special circumstances make an 
award unjust. If the applicant has sought an award against the 
Department of State and another agency, the decision shall allocate 
responsibility for payment of any award made between the Department of 
State and the other agency, and shall explain the reasons for the 
allocation made.



Sec. 134.28  Further Department of State review.

    Either the applicant or Department of State counsel may seek review 
of the initial decision. If neither the applicant nor the Department of 
State counsel seeks review, the initial decision shall become a final 
decision of the Department of State 30 days after it is issued. If 
review is taken the Judicial Officer will issue a final decision on the 
application or remand the application to the adjudicative officer for 
further proceedings.



Sec. 134.29  Judicial review.

    Judicial review of final Department of State decisions on awards as 
may be sought as provided in 5 U.S.C. 504(c)(2).



Sec. 134.30  Payment of award.

    An applicant seeking payment of an award shall submit to the 
Comptroller or other disbursing official of the Department of State a 
copy of the final decision granting the award accompanied by a statement 
that the applicant will not seek review of the decision in the United 
States courts. Requests for payment should be sent to: Executive 
Director, Office of the Comptroller, Room 1328, Department of State, 
2201 C Street, NW., Washington, DC 20520. The Department of State will 
pay the amount awarded to the applicant within 60 days, unless judicial 
review of the award or of the underlying decision of the adversary 
adjudication has been sought by the applicant or any other party to the 
proceeding.



PART 135--UNIFORM ADMINISTRATIVE REQUIREMENTS FOR GRANTS AND COOPERATIVE AGREEMENTS TO STATE AND LOCAL GOVERNMENTS--Table of Contents




                           Subpart A--General

Sec.
135.1  Purpose and scope of this part.
135.2  Scope of subpart.
135.3  Definitions.
135.4  Applicability.
135.5  Effect on other issuances.
135.6  Additions and exceptions.

                    Subpart B--Pre-Award Requirements

135.10  Forms for applying for grants.
135.11  State plans.
135.12  Special grant or subgrant conditions for ``high-risk'' grantees.

                   Subpart C--Post-Award Requirements

                        Financial Administration

135.20  Standards for financial management systems.
135.21  Payment.
135.22  Allowable costs.
135.23  Period of availability of funds.
135.24  Matching or cost sharing.
135.25  Program income.
135.26  Non-Federal audit.

                    Changes, Property, and Subawards

135.30  Changes.
135.31  Real property.
135.32  Equipment.
135.33  Supplies.
135.34  Copyrights.
135.35  Subawards to debarred and suspended parties.
135.36  Procurement.
135.37  Subgrants.

              Reports, Records, Retention, and Enforcement

135.40  Monitoring and reporting program performance.

[[Page 419]]

135.41  Financial reporting.
135.42  Retention and access requirements for records.
135.43  Enforcement.
135.44  Termination for convenience.

                 Subpart D--After-the-Grant Requirements

135.50  Closeout.
135.51  Later disallowances and adjustments.
135.52  Collection of amounts due.

                   Subpart E--Entitlements [Reserved]

    Authority:  22 U.S.C. 2658.

    Source:  53 FR 8049, 8087, Mar. 11, 1988, unless otherwise noted.



                           Subpart A--General



Sec. 135.1  Purpose and scope of this part.

    This part establishes uniform administrative rules for Federal 
grants and cooperative agreements and subawards to State, local and 
Indian tribal governments.



Sec. 135.2  Scope of subpart.

    This subpart contains general rules pertaining to this part and 
procedures for control of exceptions from this part.



Sec. 135.3  Definitions.

    As used in this part:
    Accrued expenditures mean the charges incurred by the grantee during 
a given period requiring the provision of funds for: (1) Goods and other 
tangible property received; (2) services performed by employees, 
contractors, subgrantees, subcontractors, and other payees; and (3) 
other amounts becoming owed under programs for which no current services 
or performance is required, such as annuities, insurance claims, and 
other benefit payments.
    Accrued income means the sum of: (1) Earnings during a given period 
from services performed by the grantee and goods and other tangible 
property delivered to purchasers, and (2) amounts becoming owed to the 
grantee for which no current services or performance is required by the 
grantee.
    Acquisition cost of an item of purchased equipment means the net 
invoice unit price of the property including the cost of modifications, 
attachments, accessories, or auxiliary apparatus necessary to make the 
property usable for the purpose for which it was acquired. Other charges 
such as the cost of installation, transportation, taxes, duty or 
protective in-transit insurance, shall be included or excluded from the 
unit acquisition cost in accordance with the grantee's regular 
accounting practices.
    Administrative requirements mean those matters common to grants in 
general, such as financial management, kinds and frequency of reports, 
and retention of records. These are distinguished from ``programmatic'' 
requirements, which concern matters that can be treated only on a 
program-by-program or grant-by-grant basis, such as kinds of activities 
that can be supported by grants under a particular program.
    Awarding agency means (1) with respect to a grant, the Federal 
agency, and (2) with respect to a subgrant, the party that awarded the 
subgrant.
    Cash contributions means the grantee's cash outlay, including the 
outlay of money contributed to the grantee or subgrantee by other public 
agencies and institutions, and private organizations and individuals. 
When authorized by Federal legislation, Federal funds received from 
other assistance agreements may be considered as grantee or subgrantee 
cash contributions.
    Contract means (except as used in the definitions for ``grant'' and 
``subgrant'' in this section and except where qualified by ``Federal'') 
a procurement contract under a grant or subgrant, and means a 
procurement subcontract under a contract.
    Cost sharing or matching means the value of the third party in-kind 
contributions and the portion of the costs of a federally assisted 
project or program not borne by the Federal Government.
    Cost-type contract means a contract or subcontract under a grant in 
which the contractor or subcontractor is paid on the basis of the costs 
it incurs, with or without a fee.
    Equipment means tangible, nonexpendable, personal property having a 
useful life of more than one year and an acquisition cost of $5,000 or 
more per unit. A grantee may use its own definition of equipment 
provided that

[[Page 420]]

such definition would at least include all equipment defined above.
    Expenditure report means: (1) For nonconstruction grants, the SF-269 
``Financial Status Report'' (or other equivalent report); (2) for 
construction grants, the SF-271 ``Outlay Report and Request for 
Reimbursement'' (or other equivalent report).
    Federally recognized Indian tribal government means the governing 
body or a governmental agency of any Indian tribe, band, nation, or 
other organized group or community (including any Native village as 
defined in section 3 of the Alaska Native Claims Settlement Act, 85 Stat 
688) certified by the Secretary of the Interior as eligible for the 
special programs and services provided by him through the Bureau of 
Indian Affairs.
    Government means a State or local government or a federally 
recognized Indian tribal government.
    Grant means an award of financial assistance, including cooperative 
agreements, in the form of money, or property in lieu of money, by the 
Federal Government to an eligible grantee. The term does not include 
technical assistance which provides services instead of money, or other 
assistance in the form of revenue sharing, loans, loan guarantees, 
interest subsidies, insurance, or direct appropriations. Also, the term 
does not include assistance, such as a fellowship or other lump sum 
award, which the grantee is not required to account for.
    Grantee means the government to which a grant is awarded and which 
is accountable for the use of the funds provided. The grantee is the 
entire legal entity even if only a particular component of the entity is 
designated in the grant award document.
    Local government means a county, municipality, city, town, township, 
local public authority (including any public and Indian housing agency 
under the United States Housing Act of 1937) school district, special 
district, intrastate district, council of governments (whether or not 
incorporated as a nonprofit corporation under state law), any other 
regional or interstate government entity, or any agency or 
instrumentality of a local government.
    Obligations means the amounts of orders placed, contracts and 
subgrants awarded, goods and services received, and similar transactions 
during a given period that will require payment by the grantee during 
the same or a future period.
    OMB means the United States Office of Management and Budget.
    Outlays (expenditures) mean charges made to the project or program. 
They may be reported on a cash or accrual basis. For reports prepared on 
a cash basis, outlays are the sum of actual cash disbursement for direct 
charges for goods and services, the amount of indirect expense incurred, 
the value of in-kind contributions applied, and the amount of cash 
advances and payments made to contractors and subgrantees. For reports 
prepared on an accrued expenditure basis, outlays are the sum of actual 
cash disbursements, the amount of indirect expense incurred, the value 
of inkind contributions applied, and the new increase (or decrease) in 
the amounts owed by the grantee for goods and other property received, 
for services performed by employees, contractors, subgrantees, 
subcontractors, and other payees, and other amounts becoming owed under 
programs for which no current services or performance are required, such 
as annuities, insurance claims, and other benefit payments.
    Percentage of completion method refers to a system under which 
payments are made for construction work according to the percentage of 
completion of the work, rather than to the grantee's cost incurred.
    Prior approval means documentation evidencing consent prior to 
incurring specific cost.
    Real property means land, including land improvements, structures 
and appurtenances thereto, excluding movable machinery and equipment.
    Share, when referring to the awarding agency's portion of real 
property, equipment or supplies, means the same percentage as the 
awarding agency's portion of the acquiring party's total costs under the 
grant to which the acquisition costs under the grant to which the 
acquisition cost of the property was charged. Only costs are to be 
counted--not the value of third-party in-kind contributions.

[[Page 421]]

    State means any of the several States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency or instrumentality of a 
State exclusive of local governments. The term does not include any 
public and Indian housing agency under United States Housing Act of 
1937.
    Subgrant means an award of financial assistance in the form of 
money, or property in lieu of money, made under a grant by a grantee to 
an eligible subgrantee. The term includes financial assistance when 
provided by contractual legal agreement, but does not include 
procurement purchases, nor does it include any form of assistance which 
is excluded from the definition of ``grant'' in this part.
    Subgrantee means the government or other legal entity to which a 
subgrant is awarded and which is accountable to the grantee for the use 
of the funds provided.
    Supplies means all tangible personal property other than 
``equipment'' as defined in this part.
    Suspension means depending on the context, either (1) temporary 
withdrawal of the authority to obligate grant funds pending corrective 
action by the grantee or subgrantee or a decision to terminate the 
grant, or (2) an action taken by a suspending official in accordance 
with agency regulations implementing E.O. 12549 to immediately exclude a 
person from participating in grant transactions for a period, pending 
completion of an investigation and such legal or debarment proceedings 
as may ensue.
    Termination means permanent withdrawal of the authority to obligate 
previously-awarded grant funds before that authority would otherwise 
expire. It also means the voluntary relinquishment of that authority by 
the grantee or subgrantee. ``Termination'' does not include: (1) 
Withdrawal of funds awarded on the basis of the grantee's underestimate 
of the unobligated balance in a prior period; (2) Withdrawal of the 
unobligated balance as of the expiration of a grant; (3) Refusal to 
extend a grant or award additional funds, to make a competing or 
noncompeting continuation, renewal, extension, or supplemental award; or 
(4) voiding of a grant upon determination that the award was obtained 
fraudulently, or was otherwise illegal or invalid from inception.
    Terms of a grant or subgrant mean all requirements of the grant or 
subgrant, whether in statute, regulations, or the award document.
    Third party in-kind contributions mean property or services which 
benefit a federally assisted project or program and which are 
contributed by non-Federal third parties without charge to the grantee, 
or a cost-type contractor under the grant agreement.
    Unliquidated obligations for reports prepared on a cash basis mean 
the amount of obligations incurred by the grantee that has not been 
paid. For reports prepared on an accrued expenditure basis, they 
represent the amount of obligations incurred by the grantee for which an 
outlay has not been recorded.
    Unobligated balance means the portion of the funds authorized by the 
Federal agency that has not been obligated by the grantee and is 
determined by deducting the cumulative obligations from the cumulative 
funds authorized.



Sec. 135.4  Applicability.

    (a) General. Subparts A through D of this part apply to all grants 
and subgrants to governments, except where inconsistent with Federal 
statutes or with regulations authorized in accordance with the exception 
provision of Sec. 135.6, or:
    (1) Grants and subgrants to State and local institutions of higher 
education or State and local hospitals.
    (2) The block grants authorized by the Omnibus Budget Reconciliation 
Act of 1981 (Community Services; Preventive Health and Health Services; 
Alcohol, Drug Abuse, and Mental Health Services; Maternal and Child 
Health Services; Social Services; Low-Income Home Energy Assistance; 
States' Program of Community Development Block Grants for Small Cities; 
and Elementary and Secondary Education other than programs administered 
by the Secretary of Education under title V, subtitle D, chapter 2, 
section 583--the Secretary's discretionary grant

[[Page 422]]

program) and titles I-III of the Job Training Partnership Act of 1982 
and under the Public Health Services Act (section 1921), Alcohol and 
Drug Abuse Treatment and Rehabilitation Block Grant and part C of title 
V, Mental Health Service for the Homeless Block Grant).
    (3) Entitlement grants to carry out the following programs of the 
Social Security Act:
    (i) Aid to Needy Families with Dependent Children (title IV-A of the 
Act, not including the Work Incentive Program (WIN) authorized by 
section 402(a)19(G); HHS grants for WIN are subject to this part);
    (ii) Child Support Enforcement and Establishment of Paternity (title 
IV-D of the Act);
    (iii) Foster Care and Adoption Assistance (title IV-E of the Act);
    (iv) Aid to the Aged, Blind, and Disabled (titles I, X, XIV, and 
XVI-AABD of the Act); and
    (v) Medical Assistance (Medicaid) (title XIX of the Act) not 
including the State Medicaid Fraud Control program authorized by section 
1903(a)(6)(B).
    (4) Entitlement grants under the following programs of The National 
School Lunch Act:
    (i) School Lunch (section 4 of the Act),
    (ii) Commodity Assistance (section 6 of the Act),
    (iii) Special Meal Assistance (section 11 of the Act),
    (iv) Summer Food Service for Children (section 13 of the Act), and
    (v) Child Care Food Program (section 17 of the Act).
    (5) Entitlement grants under the following programs of The Child 
Nutrition Act of 1966:
    (i) Special Milk (section 3 of the Act), and
    (ii) School Breakfast (section 4 of the Act).
    (6) Entitlement grants for State Administrative expenses under The 
Food Stamp Act of 1977 (section 16 of the Act).
    (7) A grant for an experimental, pilot, or demonstration project 
that is also supported by a grant listed in paragraph (a)(3) of this 
section;
    (8) Grant funds awarded under subsection 412(e) of the Immigration 
and Nationality Act (8 U.S.C. 1522(e)) and subsection 501(a) of the 
Refugee Education Assistance Act of 1980 (Pub. L. 96-422, 94 Stat. 
1809), for cash assistance, medical assistance, and supplemental 
security income benefits to refugees and entrants and the administrative 
costs of providing the assistance and benefits;
    (9) Grants to local education agencies under 20 U.S.C. 236 through 
241-1(a), and 242 through 244 (portions of the Impact Aid program), 
except for 20 U.S.C. 238(d)(2)(c) and 240(f) (Entitlement Increase for 
Handicapped Children); and
    (10) Payments under the Veterans Administration's State Home Per 
Diem Program (38 U.S.C. 641(a)).
    (b) Entitlement programs. Entitlement programs enumerated above in 
Sec. 135.4(a) (3) through (8) are subject to subpart E.



Sec. 135.5  Effect on other issuances.

    All other grants administration provisions of codified program 
regulations, program manuals, handbooks and other nonregulatory 
materials which are inconsistent with this part are superseded, except 
to the extent they are required by statute, or authorized in accordance 
with the exception provision in Sec. 135.6.



Sec. 135.6  Additions and exceptions.

    (a) For classes of grants and grantees subject to this part, Federal 
agencies may not impose additional administrative requirements except in 
codified regulations published in the Federal Register.
    (b) Exceptions for classes of grants or grantees may be authorized 
only by OMB.
    (c) Exceptions on a case-by-case basis and for subgrantees may be 
authorized by the affected Federal agencies.



                    Subpart B--Pre-Award Requirements



Sec. 135.10  Forms for applying for grants.

    (a) Scope. (1) This section prescribes forms and instructions to be 
used by governmental organizations (except hospitals and institutions of 
higher education operated by a government) in applying for grants. This 
section is not applicable, however, to formula grant programs which do 
not require

[[Page 423]]

applicants to apply for funds on a project basis.
    (2) This section applies only to applications to Federal agencies 
for grants, and is not required to be applied by grantees in dealing 
with applicants for subgrants. However, grantees are encouraged to avoid 
more detailed or burdensome application requirements for subgrants.
    (b) Authorized forms and instructions for governmental 
organizations. (1) In applying for grants, applicants shall only use 
standard application forms or those prescribed by the granting agency 
with the approval of OMB under the Paperwork Reduction Act of 1980.
    (2) Applicants are not required to submit more than the original and 
two copies of preapplications or applications.
    (3) Applicants must follow all applicable instructions that bear OMB 
clearance numbers. Federal agencies may specify and describe the 
programs, functions, or activities that will be used to plan, budget, 
and evaluate the work under a grant. Other supplementary instructions 
may be issued only with the approval of OMB to the extent required under 
the Paperwork Reduction Act of 1980. For any standard form, except the 
SF-424 facesheet, Federal agencies may shade out or instruct the 
applicant to disregard any line item that is not needed.
    (4) When a grantee applies for additional funding (such as a 
continuation or supplemental award) or amends a previously submitted 
application, only the affected pages need be submitted. Previously 
submitted pages with information that is still current need not be 
resubmitted.



Sec. 135.11  State plans.

    (a) Scope. The statutes for some programs require States to submit 
plans before receiving grants. Under regulations implementing Executive 
Order 12372, ``Intergovernmental Review of Federal Programs,'' States 
are allowed to simplify, consolidate and substitute plans. This section 
contains additional provisions for plans that are subject to regulations 
implementing the Executive order.
    (b) Requirements. A State need meet only Federal administrative or 
programmatic requirements for a plan that are in statutes or codified 
regulations.
    (c) Assurances. In each plan the State will include an assurance 
that the State shall comply with all applicable Federal statutes and 
regulations in effect with respect to the periods for which it receives 
grant funding. For this assurance and other assurances required in the 
plan, the State may:
    (1) Cite by number the statutory or regulatory provisions requiring 
the assurances and affirm that it gives the assurances required by those 
provisions,
    (2) Repeat the assurance language in the statutes or regulations, or
    (3) Develop its own language to the extent permitted by law.
    (d) Amendments. A State will amend a plan whenever necessary to 
reflect:
    (1) New or revised Federal statutes or regulations or;
    (2) A material change in any State law, organization, policy, or 
State agency operation. The State will obtain approval for the amendment 
and its effective date but need submit for approval only the amended 
portions of the plan.



Sec. 135.12  Special grant or subgrant conditions for ``high-risk'' grantees.

    (a) A grantee or subgrantee may be considered ``high risk'' if an 
awarding agency determines that a grantee or subgrantee:
    (1) Has a history of unsatisfactory performance, or
    (2) Is not financially stable, or
    (3) Has a management system which does not meet the management 
standards set forth in this part, or
    (4) Has not conformed to terms and conditions of previous awards, or
    (5) Is otherwise not responsible; and if the awarding agency 
determines that an award will be made, special conditions and/or 
restrictions shall correspond to the high risk condition and shall be 
included in the award.
    (b) Special conditions or restrictions may include:
    (1) Payment on a reimbursement basis;

[[Page 424]]

    (2) Withholding authority to proceed to the next phase until receipt 
of evidence of acceptable performance within a given funding period;
    (3) Requiring additional, more detailed financial reports;
    (4) Additional project monitoring;
    (5) Requiring the grante or subgrantee to obtain technical or 
management assistance; or
    (6) Establishing additional prior approvals.
    (c) If an awarding agency decides to impose such conditions, the 
awarding official will notify the grantee or subgrantee as early as 
possible, in writing, of:
    (1) The nature of the special conditions/restrictions;
    (2) The reason(s) for imposing them;
    (3) The corrective actions which must be taken before they will be 
removed and the time allowed for completing the corrective actions and
    (4) The method of requesting reconsideration of the conditions/
restrictions imposed.



                   Subpart C--Post-Award Requirements

                        Financial Administration



Sec. 135.20  Standards for financial management systems.

    (a) A State must expand and account for grant funds in accordance 
with State laws and procedures for expending and accounting for its own 
funds. Fiscal control and accounting procedures of the State, as well as 
its subgrantees and cost-type contractors, must be sufficient to--
    (1) Permit preparation of reports required by this part and the 
statutes authorizing the grant, and
    (2) Permit the tracing of funds to a level of expenditures adequate 
to establish that such funds have not been used in violation of the 
restrictions and prohibitions of applicable statutes.
    (b) The financial management systems of other grantees and 
subgrantees must meet the following standards:
    (1) Financial reporting. Accurate, current, and complete disclosure 
of the financial results of financially assisted activities must be made 
in accordance with the financial reporting requirements of the grant or 
subgrant.
    (2) Accounting records. Grantees and subgrantees must maintain 
records which adequately identify the source and application of funds 
provided for financially-assisted activities. These records must contain 
information pertaining to grant or subgrant awards and authorizations, 
obligations, unobligated balances, assets, liabilities, outlays or 
expenditures, and income.
    (3) Internal control. Effective control and accountability must be 
maintained for all grant and subgrant cash, real and personal property, 
and other assets. Grantees and subgrantees must adequately safeguard all 
such property and must assure that it is used solely for authorized 
purposes.
    (4) Budget control. Actual expenditures or outlays must be compared 
with budgeted amounts for each grant or subgrant. Financial information 
must be related to performance or productivity data, including the 
development of unit cost information whenever appropriate or 
specifically required in the grant or subgrant agreement. If unit cost 
data are required, estimates based on available documentation will be 
accepted whenever possible.
    (5) Allowable cost. Applicable OMB cost principles, agency program 
regulations, and the terms of grant and subgrant agreements will be 
followed in determining the reasonableness, allowability, and 
allocability of costs.
    (6) Source documentation. Accounting records must be supported by 
such source documentation as cancelled checks, paid bills, payrolls, 
time and attendance records, contract and subgrant award documents, etc.
    (7) Cash management. Procedures for minimizing the time elapsing 
between the transfer of funds from the U.S. Treasury and disbursement by 
grantees and subgrantees must be followed whenever advance payment 
procedures are used. Grantees must establish reasonable procedures to 
ensure the receipt of reports on subgrantees' cash balances and cash 
disbursements in sufficient time to enable them to prepare complete and 
accurate cash transactions reports to the awarding agency. When advances 
are made by letter-

[[Page 425]]

of-credit or electronic transfer of funds methods, the grantee must make 
drawdowns as close as possible to the time of making disbursements. 
Grantees must monitor cash drawdowns by their subgrantees to assure that 
they conform substantially to the same standards of timing and amount as 
apply to advances to the grantees.
    (c) An awarding agency may review the adequacy of the financial 
management system of any applicant for financial assistance as part of a 
preaward review or at any time subsequent to award.



Sec. 135.21  Payment.

    (a) Scope. This section prescribes the basic standard and the 
methods under which a Federal agency will make payments to grantees, and 
grantees will make payments to subgrantees and contractors.
    (b) Basic standard. Methods and procedures for payment shall 
minimize the time elapsing between the transfer of funds and 
disbursement by the grantee or subgrantee, in accordance with Treasury 
regulations at 31 CFR part 205.
    (c) Advances. Grantees and subgrantees shall be paid in advance, 
provided they maintain or demonstrate the willingness and ability to 
maintain procedures to minimize the time elapsing between the transfer 
of the funds and their disbursement by the grantee or subgrantee.
    (d) Reimbursement. Reimbursement shall be the preferred method when 
the requirements in paragraph (c) of this section are not met. Grantees 
and subgrantees may also be paid by reimbursement for any construction 
grant. Except as otherwise specified in regulation, Federal agencies 
shall not use the percentage of completion method to pay construction 
grants. The grantee or subgrantee may use that method to pay its 
construction contractor, and if it does, the awarding agency's payments 
to the grantee or subgrantee will be based on the grantee's or 
subgrantee's actual rate of disbursement.
    (e) Working capital advances. If a grantee cannot meet the criteria 
for advance payments described in paragraph (c) of this section, and the 
Federal agency has determined that reimbursement is not feasible because 
the grantee lacks sufficient working capital, the awarding agency may 
provide cash or a working capital advance basis. Under this procedure 
the awarding agency shall advance cash to the grantee to cover its 
estimated disbursement needs for an initial period generally geared to 
the grantee's disbursing cycle. Thereafter, the awarding agency shall 
reimburse the grantee for its actual cash disbursements. The working 
capital advance method of payment shall not be used by grantees or 
subgrantees if the reason for using such method is the unwillingness or 
inability of the grantee to provide timely advances to the subgrantee to 
meet the subgrantee's actual cash disbursements.
    (f) Effect of program income, refunds, and audit recoveries on 
payment. (1) Grantees and subgrantees shall disburse repayments to and 
interest earned on a revolving fund before requesting additional cash 
payments for the same activity.
    (2) Except as provided in paragraph (f)(1) of this section, grantees 
and subgrantees shall disburse program income, rebates, refunds, 
contract settlements, audit recoveries and interest earned on such funds 
before requesting additional cash payments.
    (g) Withholding payments. (1) Unless otherwise required by Federal 
statute, awarding agencies shall not withhold payments for proper 
charges incurred by grantees or subgrantees unless--
    (i) The grantee or subgrantee has failed to comply with grant award 
conditions or
    (ii) The grantee or subgrantee is indebted to the United States.
    (2) Cash withheld for failure to comply with grant award condition, 
but without suspension of the grant, shall be released to the grantee 
upon subsequent compliance. When a grant is suspended, payment 
adjustments will be made in accordance with Sec. 135.43(c).
    (3) A Federal agency shall not make payment to grantees for amounts 
that are withheld by grantees or subgrantees from payment to contractors 
to assure satisfactory completion of work. Payments shall be made by the 
Federal agency when the grantees or

[[Page 426]]

subgrantees actually disburse the withheld funds to the contractors or 
to escrow accounts established to assure satisfactory completion of 
work.
    (h) Cash depositories. (1) Consistent with the national goal of 
expanding the opportunities for minority business enterprises, grantees 
and subgrantees are encouraged to use minority banks (a bank which is 
owned at least 50 percent by minority group members). A list of minority 
owned banks can be obtained from the Minority Business Development 
Agency, Department of Commerce, Washington, DC 20230.
    (2) A grantee or subgrantee shall maintain a separate bank account 
only when required by Federal-State agreement.
    (i) Interest earned on advances. Except for interest earned on 
advances of funds exempt under the Intergovernmental Cooperation Act (31 
U.S.C. 6501 et seq.) and the Indian Self-Determination Act (23 U.S.C. 
450), grantees and subgrantees shall promptly, but at least quarterly, 
remit interest earned on advances to the Federal agency. The grantee or 
subgrantee may keep interest amounts up to $100 per year for 
administrative expenses.



Sec. 135.22  Allowable costs.

    (a) Limitation on use of funds. Grant funds may be used only for:
    (1) The allowable costs of the grantees, subgrantees and cost-type 
contractors, including allowable costs in the form of payments to fixed-
price contractors; and
    (2) Reasonable fees or profit to cost-type contractors but not any 
fee or profit (or other increment above allowable costs) to the grantee 
or subgrantee.
    (b) Applicable cost principles. For each kind of organization, there 
is a set of Federal principles for determining allowable costs. 
Allowable costs will be determined in accordance with the cost 
principles applicable to the organization incurring the costs. The 
following chart lists the kinds of organizations and the applicable cost 
principles.

                                                                        
------------------------------------------------------------------------
           For the costs of a--                Use the principles in--  
------------------------------------------------------------------------
State, local or Indian tribal government..  OMB Circular A-87.          
Private nonprofit organization other than   OMB Circular A-122.         
 an (1) institution of higher education,                                
 (2) hospital, or (3) organization named                                
 in OMB Circular A-122 as not subject to                                
 that circular.                                                         
Educational institutions..................  OMB Circular A-21.          
For-profit organization other than a        48 CFR Part 31. Contract    
 hospital and an organization named in OBM   Cost Principles and        
 Circular A-122 as not subject to that       Procedures, or uniform cost
 circular.                                   accounting standards that  
                                             comply with cost principles
                                             acceptable to the Federal  
                                             agency.                    
------------------------------------------------------------------------



Sec. 135.23  Period of availability of funds.

    (a) General. Where a funding period is specified, a grantee may 
charge to the award only costs resulting from obligations of the funding 
period unless carryover of unobligated balances is permitted, in which 
case the carryover balances may be charged for costs resulting from 
obligations of the subsequent funding period.
    (b) Liquidation of obligations. A grantee must liquidate all 
obligations incurred under the award not later than 90 days after the 
end of the funding period (or as specified in a program regulation) to 
coincide with the submission of the annual Financial Status Report (SF-
269). The Federal agency may extend this deadline at the request of the 
grantee.



Sec. 135.24  Matching or cost sharing.

    (a) Basic rule: Costs and contributions acceptable. With the 
qualifications and exceptions listed in paragraph (b) of this section, a 
matching or cost sharing requirement may be satisfied by either or both 
of the following:
    (1) Allowable costs incurred by the grantee, subgrantee or a cost-
type contractor under the assistance agreement. This includes allowable 
costs borne by non-Federal grants or by others cash donations from non-
Federal third parties.
    (2) The value of third party in-kind contributions applicable to the 
period to which the cost sharing or matching requirements applies.
    (b) Qualifications and exceptions--(1) Costs borne by other Federal 
grant agreements. Except as provided by Federal statute, a cost sharing 
or matching requirement may not be met by costs

[[Page 427]]

borne by another Federal grant. This prohibition does not apply to 
income earned by a grantee or subgrantee from a contract awarded under 
another Federal grant.
    (2) General revenue sharing. For the purpose of this section, 
general revenue sharing funds distributed under 31 U.S.C. 6702 are not 
considered Federal grant funds.
    (3) Cost or contributions counted towards other Federal costs-
sharing requirements. Neither costs nor the values of third party in-
kind contributions may count towards satisfying a cost sharing or 
matching requirement of a grant agreement if they have been or will be 
counted towards satisfying a cost sharing or matching requirement of 
another Federal grant agreement, a Federal procurement contract, or any 
other award of Federal funds.
    (4) Costs financed by program income. Costs financed by program 
income, as defined in Sec. 135.25, shall not count towards satisfying a 
cost sharing or matching requirement unless they are expressly permitted 
in the terms of the assistance agreement. (This use of general program 
income is described in Sec. 135.25(g).)
    (5) Services or property financed by income earned by contractors. 
Contractors under a grant may earn income from the activities carried 
out under the contract in addition to the amounts earned from the party 
awarding the contract. No costs of services or property supported by 
this income may count toward satisfying a cost sharing or matching 
requirement unless other provisions of the grant agreement expressly 
permit this kind of income to be used to meet the requirement.
    (6) Records. Costs and third party in-kind contributions counting 
towards satisfying a cost sharing or matching requirement must be 
verifiable from the records of grantees and subgrantee or cost-type 
contractors. These records must show how the value placed on third party 
in-kind contributions was derived. To the extent feasible, volunteer 
services will be supported by the same methods that the organization 
uses to support the allocability of regular personnel costs.
    (7) Special standards for third party in-kind contributions. (i) 
Third party in-kind contributions count towards satisfying a cost 
sharing or matching requirement only where, if the party receiving the 
contributions were to pay for them, the payments would be allowable 
costs.
    (ii) Some third party in-kind contributions are goods and services 
that, if the grantee, subgrantee, or contractor receiving the 
contribution had to pay for them, the payments would have been an 
indirect costs. Costs sharing or matching credit for such contributions 
shall be given only if the grantee, subgrantee, or contractor has 
established, along with its regular indirect cost rate, a special rate 
for allocating to individual projects or programs the value of the 
contributions.
    (iii) A third party in-kind contribution to a fixed-price contract 
may count towards satisfying a cost sharing or matching requirement only 
if it results in:
    (A) An increase in the services or property provided under the 
contract (without additional cost to the grantee or subgrantee) or
    (B) A cost savings to the grantee or subgrantee.
    (iv) The values placed on third party in-kind contributions for cost 
sharing or matching purposes will conform to the rules in the succeeding 
sections of this part. If a third party in-kind contribution is a type 
not treated in those sections, the value placed upon it shall be fair 
and reasonable.
    (c) Valuation of donated services--(1) Volunteer services. Unpaid 
services provided to a grantee or subgrantee by individuals will be 
valued at rates consistent with those ordinarily paid for similar work 
in the grantee's or subgrantee's organization. If the grantee or 
subgrantee does not have employees performing similar work, the rates 
will be consistent with those ordinarily paid by other employers for 
similar work in the same labor market. In either case, a reasonable 
amount for fringe benefits may be included in the valuation.
    (2) Employees of other organizations. When an employer other than a 
grantee, subgrantee, or cost-type contractor furnishes free of charge 
the services of an employee in the employee's normal line of work, the 
services will be valued

[[Page 428]]

at the employee's regular rate of pay exclusive of the employee's fringe 
benefits and overhead costs. If the services are in a different line of 
work, paragraph (c)(1) of this section applies.
    (d) Valuation of third party donated supplies and loaned equipment 
or space. (1) If a third party donates supplies, the contribution will 
be valued at the market value of the supplies at the time of donation.
    (2) If a third party donates the use of equipment or space in a 
building but retains title, the contribution will be valued at the fair 
rental rate of the equipment or space.
    (e) Valuation of third party donated equipment, buildings, and land. 
If a third party donates equipment, buildings, or land, and title passes 
to a grantee or subgrantee, the treatment of the donated property will 
depend upon the purpose of the grant or subgrant, as follows:
    (1) Awards for capital expenditures. If the purpose of the grant or 
subgrant is to assist the grantee or subgrantee in the acquisition of 
property, the market value of that property at the time of donation may 
be counted as cost sharing or matching,
    (2) Other awards. If assisting in the acquisition of property is not 
the purpose of the grant or subgrant, paragraphs (e)(2) (i) and (ii) of 
this section apply:
    (i) If approval is obtained from the awarding agency, the market 
value at the time of donation of the donated equipment or buildings and 
the fair rental rate of the donated land may be counted as cost sharing 
or matching. In the case of a subgrant, the terms of the grant agreement 
may require that the approval be obtained from the Federal agency as 
well as the grantee. In all cases, the approval may be given only if a 
purchase of the equipment or rental of the land would be approved as an 
allowable direct cost. If any part of the donated property was acquired 
with Federal funds, only the non-federal share of the property may be 
counted as cost-sharing or matching.
    (ii) If approval is not obtained under paragraph (e)(2)(i) of this 
section, no amount may be counted for donated land, and only 
depreciation or use allowances may be counted for donated equipment and 
buildings. The depreciation or use allowances for this property are not 
treated as third party in-kind contributions. Instead, they are treated 
as costs incurred by the grantee or subgrantee. They are computed and 
allocated (usually as indirect costs) in accordance with the cost 
principles specified in Sec. 135.22, in the same way as depreciation or 
use allowances for purchased equipment and buildings. The amount of 
depreciation or use allowances for donated equipment and buildings is 
based on the property's market value at the time it was donated.
    (f) Valuation of grantee or subgrantee donated real property for 
construction/acquisition. If a grantee or subgrantee donates real 
property for a construction or facilities acquisition project, the 
current market value of that property may be counted as cost sharing or 
matching. If any part of the donated property was acquired with Federal 
funds, only the non-federal share of the property may be counted as cost 
sharing or matching.
    (g) Appraisal of real property. In some cases under paragraphs (d), 
(e) and (f) of this section, it will be necessary to establish the 
market value of land or a building or the fair rental rate of land or of 
space in a building. In these cases, the Federal agency may require the 
market value or fair rental value be set by an independent appraiser, 
and that the value or rate be certified by the grantee. This requirement 
will also be imposed by the grantee on subgrantees.



Sec. 135.25  Program income.

    (a) General. Grantees are encouraged to earn income to defray 
program costs. Program income includes income from fees for services 
performed, from the use or rental of real or personal property acquired 
with grant funds, from the sale of commodities or items fabricated under 
a grant agreement, and from payments of principal and interest on loans 
made with grant funds. Except as otherwise provided in regulations of 
the Federal agency, program income does not include interest on grant 
funds, rebates, credits, discounts, refunds, etc. and interest earned on 
any of them.

[[Page 429]]

    (b) Definition of program income. Program income means gross income 
received by the grantee or subgrantee directly generated by a grant 
supported activity, or earned only as a result of the grant agreement 
during the grant period. ``During the grant period'' is the time between 
the effective date of the award and the ending date of the award 
reflected in the final financial report.
    (c) Cost of generating program income. If authorized by Federal 
regulations or the grant agreement, costs incident to the generation of 
program income may be deducted from gross income to determine program 
income.
    (d) Governmental revenues. Taxes, special assessments, levies, 
fines, and other such revenues raised by a grantee or subgrantee are not 
program income unless the revenues are specifically identified in the 
grant agreement or Federal agency regulations as program income.
    (e) Royalties. Income from royalties and license fees for 
copyrighted material, patents, and inventions developed by a grantee or 
subgrantee is program income only if the revenues are specifically 
identified in the grant agreement or Federal agency regulations as 
program income. (See Sec. 135.34.)
    (f) Property. Proceeds from the sale of real property or equipment 
will be handled in accordance with the requirements of Secs. 135.31 and 
135.32.
    (g) Use of program income. Program income shall be deducted from 
outlays which may be both Federal and non-Federal as described below, 
unless the Federal agency regulations or the grant agreement specify 
another alternative (or a combination of the alternatives). In 
specifying alternatives, the Federal agency may distinguish between 
income earned by the grantee and income earned by subgrantees and 
between the sources, kinds, or amounts of income. When Federal agencies 
authorize the alternatives in paragraphs (g) (2) and (3) of this 
section, program income in excess of any limits stipulated shall also be 
deducted from outlays.
    (1) Deduction. Ordinarily program income shall be deducted from 
total allowable costs to determine the net allowable costs. Program 
income shall be used for current costs unless the Federal agency 
authorizes otherwise. Program income which the grantee did not 
anticipate at the time of the award shall be used to reduce the Federal 
agency and grantee contributions rather than to increase the funds 
committed to the project.
    (2) Addition. When authorized, program income may be added to the 
funds committed to the grant agreement by the Federal agency and the 
grantee. The program income shall be used for the purposes and under the 
conditions of the grant agreement.
    (3) Cost sharing or matching. When authorized, program income may be 
used to meet the cost sharing or matching requirement of the grant 
agreement. The amount of the Federal grant award remains the same.
    (h) Income after the award period. There are no Federal requirements 
governing the disposition of program income earned after the end of the 
award period (i.e., until the ending date of the final financial report, 
see paragraph (a) of this section), unless the terms of the agreement or 
the Federal agency regulations provide otherwise.



Sec. 135.26  Non-Federal audit.

    (a) Basic rule. Grantees and subgrantees are responsible for 
obtaining audits in accordance with the Single Audit Act Amendments of 
1996 (31 U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of 
States, Local Governments, and Non-Profit Organizations.'' The audits 
shall be made by an independent auditor in accordance with generally 
accepted government auditing standards covering financial audits.
    (b) Subgrantees. State or local governments, as those terms are 
defined for purposes of the Single Audit Act Amendments of 1996, that 
provide Federal awards to a subgrantee, which expends $300,000 or more 
(or other amount as specified by OMB) in Federal awards in a fiscal 
year, shall:
    (1) Determine whether State or local subgrantees have met the audit 
requirements of the Act and whether subgrantees covered by OMB Circular 
A-110, ``Uniform Administrative Requirements for Grants and Agreements 
with

[[Page 430]]

Institutions of Higher Education, Hospitals, and Other Non-Profit 
Organizations,'' have met the audit requirements of the Act. Commercial 
contractors (private for-profit and private and governmental 
organizations) providing goods and services to State and local 
governments are not required to have a single audit performed. State and 
local governments should use their own procedures to ensure that the 
contractor has complied with laws and regulations affecting the 
expenditure of Federal funds;
    (2) Determine whether the subgrantee spent Federal assistance funds 
provided in accordance with applicable laws and regulations. This may be 
accomplished by reviewing an audit of the subgrantee made in accordance 
with the Act, Circular A-110, or through other means (e.g., program 
reviews) if the subgrantee has not had such an audit;
    (3) Ensure that appropriate corrective action is taken within six 
months after receipt of the audit report in instance of noncompliance 
with Federal laws and regulations;
    (4) Consider whether subgrantee audits necessitate adjustment of the 
grantee's own records; and
    (5) Require each subgrantee to permit independent auditors to have 
access to the records and financial statements.
    (c) Auditor selection. In arranging for audit services, Sec. 135.36 
shall be followed.
[53 FR 8049, 8087, Mar. 11, 1988, as amended at 62 FR 45939, 45941, Aug. 
29, 1997]

                    Changes, Property, and Subawards



Sec. 135.30  Changes.

    (a) General. Grantees and subgrantees are permitted to rebudget 
within the approved direct cost budget to meet unanticipated 
requirements and may make limited program changes to the approved 
project. However, unless waived by the awarding agency, certain types of 
post-award changes in budgets and projects shall require the prior 
written approval of the awarding agency.
    (b) Relation to cost principles. The applicable cost principles (see 
Sec. 135.22) contain requirements for prior approval of certain types of 
costs. Except where waived, those requirements apply to all grants and 
subgrants even if paragraphs (c) through (f) of this section do not.
    (c) Budget changes--(1) Nonconstruction projects. Except as stated 
in other regulations or an award document, grantees or subgrantees shall 
obtain the prior approval of the awarding agency whenever any of the 
following changes is anticipated under a nonconstruction award:
    (i) Any revision which would result in the need for additional 
funding.
    (ii) Unless waived by the awarding agency, cumulative transfers 
among direct cost categories, or, if applicable, among separately 
budgeted programs, projects, functions, or activities which exceed or 
are expected to exceed ten percent of the current total approved budget, 
whenever the awarding agency's share exceeds $100,000.
    (iii) Transfer of funds allotted for training allowances (i.e., from 
direct payments to trainees to other expense categories).
    (2) Construction projects. Grantees and subgrantees shall obtain 
prior written approval for any budget revision which would result in the 
need for additional funds.
    (3) Combined construction and nonconstruction projects. When a grant 
or subgrant provides funding for both construction and nonconstruction 
activities, the grantee or subgrantee must obtain prior written approval 
from the awarding agency before making any fund or budget transfer from 
nonconstruction to construction or vice versa.
    (d) Programmatic changes. Grantees or subgrantees must obtain the 
prior approval of the awarding agency whenever any of the following 
actions is anticipated:
    (1) Any revision of the scope or objectives of the project 
(regardless of whether there is an associated budget revision requiring 
prior approval).
    (2) Need to extend the period of availability of funds.
    (3) Changes in key persons in cases where specified in an 
application or a grant award. In research projects, a change in the 
project director or principal investigator shall always require approval 
unless waived by the awarding agency.

[[Page 431]]

    (4) Under nonconstruction projects, contracting out, subgranting (if 
authorized by law) or otherwise obtaining the services of a third party 
to perform activities which are central to the purposes of the award. 
This approval requirement is in addition to the approval requirements of 
Sec. 135.36 but does not apply to the procurement of equipment, 
supplies, and general support services.
    (e) Additional prior approval requirements. The awarding agency may 
not require prior approval for any budget revision which is not 
described in paragraph (c) of this section.
    (f) Requesting prior approval. (1) A request for prior approval of 
any budget revision will be in the same budget formal the grantee used 
in its application and shall be accompanied by a narrative justification 
for the proposed revision.
    (2) A request for a prior approval under the applicable Federal cost 
principles (see Sec. 135.22) may be made by letter.
    (3) A request by a subgrantee for prior approval will be addressed 
in writing to the grantee. The grantee will promptly review such request 
and shall approve or disapprove the request in writing. A grantee will 
not approve any budget or project revision which is inconsistent with 
the purpose or terms and conditions of the Federal grant to the grantee. 
If the revision, requested by the subgrantee would result in a change to 
the grantee's approved project which requires Federal prior approval, 
the grantee will obtain the Federal agency's approval before approving 
the subgrantee's request.



Sec. 135.31  Real property.

    (a) Title. Subject to the obligations and conditions set forth in 
this section, title to real property acquired under a grant or subgrant 
will vest upon acquisition in the grantee or subgrantee respectively.
    (b) Use. Except as otherwise provided by Federal statutes, real 
property will be used for the originally authorized purposes as long as 
needed for that purposes, and the grantee or subgrantee shall not 
dispose of or encumber its title or other interests.
    (c) Disposition. When real property is no longer needed for the 
originally authorized purpose, the grantee or subgrantee will request 
disposition instructions from the awarding agency. The instructions will 
provide for one of the following alternatives:
    (1) Retention of title. Retain title after compensating the awarding 
agency. The amount paid to the awarding agency will be computed by 
applying the awarding agency's percentage of participation in the cost 
of the original purchase to the fair market value of the property. 
However, in those situations where a grantee or subgrantee is disposing 
of real property acquired with grant funds and acquiring replacement 
real property under the same program, the net proceeds from the 
disposition may be used as an offset to the cost of the replacement 
property.
    (2) Sale of property. Sell the property and compensate the awarding 
agency. The amount due to the awarding agency will be calculated by 
applying the awarding agency's percentage of participation in the cost 
of the original purchase to the proceeds of the sale after deduction of 
any actual and reasonable selling and fixing-up expenses. If the grant 
is still active, the net proceeds from sale may be offset against the 
original cost of the property. When a grantee or subgrantee is directed 
to sell property, sales procedures shall be followed that provide for 
competition to the extent practicable and result in the highest possible 
return.
    (3) Transfer of title. Transfer title to the awarding agency or to a 
third-party designated/approved by the awarding agency. The grantee or 
subgrantee shall be paid an amount calculated by applying the grantee or 
subgrantee's percentage of participation in the purchase of the real 
property to the current fair market value of the property.



Sec. 135.32  Equipment.

    (a) Title. Subject to the obligations and conditions set forth in 
this section, title to equipment acquired under a grant or subgrant will 
vest upon acquisition in the grantee or subgrantee respectively.
    (b) States. A State will use, manage, and dispose of equipment 
acquired

[[Page 432]]

under a grant by the State in accordance with State laws and procedures. 
Other grantees and subgrantees will follow paragraphs (c) through (e) of 
this section.
    (c) Use. (1) Equipment shall be used by the grantee or subgrantee in 
the program or project for which it was acquired as long as needed, 
whether or not the project or program continues to be supported by 
Federal funds. When no longer needed for the original program or 
project, the equipment may be used in other activities currently or 
previously supported by a Federal agency.
    (2) The grantee or subgrantee shall also make equipment available 
for use on other projects or programs currently or previously supported 
by the Federal Government, providing such use will not interfere with 
the work on the projects or program for which it was originally 
acquired. First preference for other use shall be given to other 
programs or projects supported by the awarding agency. User fees should 
be considered if appropriate.
    (3) Notwithstanding the encouragement in Sec. 135.25(a) to earn 
program income, the grantee or subgrantee must not use equipment 
acquired with grant funds to provide services for a fee to compete 
unfairly with private companies that provide equivalent services, unless 
specifically permitted or contemplated by Federal statute.
    (4) When acquiring replacement equipment, the grantee or subgrantee 
may use the equipment to be replaced as a trade-in or sell the property 
and use the proceeds to offset the cost of the replacement property, 
subject to the approval of the awarding agency.
    (d) Management requirements. Procedures for managing equipment 
(including replacement equipment), whether acquired in whole or in part 
with grant funds, until disposition takes place will, as a minimum, meet 
the following requirements:
    (1) Property records must be maintained that include a description 
of the property, a serial number or other identification number, the 
source of property, who holds title, the acquisition date, and cost of 
the property, percentage of Federal participation in the cost of the 
property, the location, use and condition of the property, and any 
ultimate disposition data including the date of disposal and sale price 
of the property.
    (2) A physical inventory of the property must be taken and the 
results reconciled with the property records at least once every two 
years.
    (3) A control system must be developed to ensure adequate safeguards 
to prevent loss, damage, or theft of the property. Any loss, damage, or 
theft shall be investigated.
    (4) Adequate maintenance procedures must be developed to keep the 
property in good condition.
    (5) If the grantee or subgrantee is authorized or required to sell 
the property, proper sales procedures must be established to ensure the 
highest possible return.
    (e) Disposition. When original or replacement equipment acquired 
under a grant or subgrant is no longer needed for the original project 
or program or for other activities currently or previously supported by 
a Federal agency, disposition of the equipment will be made as follows:
    (1) Items of equipment with a current per-unit fair market value of 
less than $5,000 may be retained, sold or otherwise disposed of with no 
further obligation to the awarding agency.
    (2) Items of equipment with a current per unit fair market value in 
excess of $5,000 may be retained or sold and the awarding agency shall 
have a right to an amount calculated by multiplying the current market 
value or proceeds from sale by the awarding agency's share of the 
equipment.
    (3) In cases where a grantee or subgrantee fails to take appropriate 
disposition actions, the awarding agency may direct the grantee or 
subgrantee to take excess and disposition actions.
    (f) Federal equipment. In the event a grantee or subgrantee is 
provided federally-owned equipment:
    (1) Title will remain vested in the Federal Government.
    (2) Grantees or subgrantees will manage the equipment in accordance 
with Federal agency rules and procedures, and submit an annual inventory 
listing.
    (3) When the equipment is no longer needed, the grantee or 
subgrantee will

[[Page 433]]

request disposition instructions from the Federal agency.
    (g) Right to transfer title. The Federal awarding agency may reserve 
the right to transfer title to the Federal Government or a third part 
named by the awarding agency when such a third party is otherwise 
eligible under existing statutes. Such transfers shall be subject to the 
following standards:
    (1) The property shall be identified in the grant or otherwise made 
known to the grantee in writing.
    (2) The Federal awarding agency shall issue disposition instruction 
within 120 calendar days after the end of the Federal support of the 
project for which it was acquired. If the Federal awarding agency fails 
to issue disposition instructions within the 120 calendar-day period the 
grantee shall followSec. 135.32(e).
    (3) When title to equipment is transferred, the grantee shall be 
paid an amount calculated by applying the percentage of participation in 
the purchase to the current fair market value of the property.



Sec. 135.33  Supplies.

    (a) Title. Title to supplies acquired under a grant or subgrant will 
vest, upon acquisition, in the grantee or subgrantee respectively.
    (b) Disposition. If there is a residual inventory of unused supplies 
exceeding $5,000 in total aggregate fair market value upon termination 
or completion of the award, and if the supplies are not needed for any 
other federally sponsored programs or projects, the grantee or 
subgrantee shall compensate the awarding agency for its share.



Sec. 135.34  Copyrights.

    The Federal awarding agency reserves a royalty-free, nonexclusive, 
and irrevocable license to reproduce, publish or otherwise use, and to 
authorize others to use, for Federal Government purposes:
    (a) The copyright in any work developed under a grant, subgrant, or 
contract under a grant or subgrant; and
    (b) Any rights of copyright to which a grantee, subgrantee or a 
contractor purchases ownership with grant support.



Sec. 135.35  Subawards to debarred and suspended parties.

    Grantees and subgrantees must not make any award or permit any award 
(subgrant or contract) at any tier to any party which is debarred or 
suspended or is otherwise excluded from or ineligible for participation 
in Federal assistance programs under Executive Order 12549, ``Debarment 
and Suspension.''



Sec. 135.36  Procurement.

    (a) States. When procuring property and services under a grant, a 
State will follow the same policies and procedures it uses for 
procurements from its non-Federal funds. The State will ensure that 
every purchase order or other contract includes any clauses required by 
Federal statutes and executive orders and their implementing 
regulations. Other grantees and subgrantees will follow paragraphs (b) 
through (i) in this section.
    (b) Procurement standards. (1) Grantees and subgrantees will use 
their own procurement procedures which reflect applicable State and 
local laws and regulations, provided that the procurements conform to 
applicable Federal law and the standards identified in this section.
    (2) Grantees and subgrantees will maintain a contract administration 
system which ensures that contractors perform in accordance with the 
terms, conditions, and specifications of their contracts or purchase 
orders.
    (3) Grantees and subgrantees will maintain a written code of 
standards of conduct governing the performance of their employees 
engaged in the award and administration of contracts. No employee, 
officer or agent of the grantee or subgrantee shall participate in 
selection, or in the award or administration of a contract supported by 
Federal funds if a conflict of interest, real or apparent, would be 
involved. Such a conflict would arise when:
    (i) The employee, officer or agent,
    (ii) Any member of his immediate family,
    (iii) His or her partner, or
    (iv) An organization which employs, or is about to employ, any of 
the above, has a financial or other interest in the firm selected for 
award. The

[[Page 434]]

grantee's or subgrantee's officers, employees or agents will neither 
solicit nor accept gratuities, favors or anything of monetary value from 
contractors, potential contractors, or parties to subagreements. Grantee 
and subgrantees may set minimum rules where the financial interest is 
not substantial or the gift is an unsolicited item of nominal intrinsic 
value. To the extent permitted by State or local law or regulations, 
such standards or conduct will provide for penalties, sanctions, or 
other disciplinary actions for violations of such standards by the 
grantee's and subgrantee's officers, employees, or agents, or by 
contractors or their agents. The awarding agency may in regulation 
provide additional prohibitions relative to real, apparent, or potential 
conflicts of interest.
    (4) Grantee and subgrantee procedures will provide for a review of 
proposed procurements to avoid purchase of unnecessary or duplicative 
items. Consideration should be given to consolidating or breaking out 
procurements to obtain a more economical purchase. Where appropriate, an 
analysis will be made of lease versus purchase alternatives, and any 
other appropriate analysis to determine the most economical approach.
    (5) To foster greater economy and efficiency, grantees and 
subgrantees are encouraged to enter into State and local 
intergovernmental agreements for procurement or use of common goods and 
services.
    (6) Grantees and subgrantees are encouraged to use Federal excess 
and surplus property in lieu of purchasing new equipment and property 
whenever such use is feasible and reduces project costs.
    (7) Grantees and subgrantees are encouraged to use value engineering 
clauses in contracts for construction projects of sufficient size to 
offer reasonable opportunities for cost reductions. Value engineering is 
a systematic and creative anaylsis of each contract item or task to 
ensure that its essential function is provided at the overall lower 
cost.
    (8) Grantees and subgrantees will make awards only to responsible 
contractors possessing the ability to perform successfully under the 
terms and conditions of a proposed procurement. Consideration will be 
given to such matters as contractor integrity, compliance with public 
policy, record of past performance, and financial and technical 
resources.
    (9) Grantees and subgrantees will maintain records sufficient to 
detail the significant history of a procurement. These records will 
include, but are not necessarily limited to the following: rationale for 
the method of procurement, selection of contract type, contractor 
selection or rejection, and the basis for the contract price.
    (10) Grantees and subgrantees will use time and material type 
contracts only--
    (i) After a determination that no other contract is suitable, and
    (ii) If the contract includes a ceiling price that the contractor 
exceeds at its own risk.
    (11) Grantees and subgrantees alone will be responsible, in 
accordance with good administrative practice and sound business 
judgment, for the settlement of all contractual and administrative 
issues arising out of procurements. These issues include, but are not 
limited to source evaluation, protests, disputes, and claims. These 
standards do not relieve the grantee or subgrantee of any contractual 
responsibilities under its contracts. Federal agencies will not 
substitute their judgment for that of the grantee or subgrantee unless 
the matter is primarily a Federal concern. Violations of law will be 
referred to the local, State, or Federal authority having proper 
jurisdiction.
    (12) Grantees and subgrantees will have protest procedures to handle 
and resolve disputes relating to their procurements and shall in all 
instances disclose information regarding the protest to the awarding 
agency. A protestor must exhaust all administrative remedies with the 
grantee and subgrantee before pursuing a protest with the Federal 
agency. Reviews of protests by the Federal agency will be limited to:
    (i) Violations of Federal law or regulations and the standards of 
this section (violations of State or local law will be under the 
jurisdiction of State or local authorities) and

[[Page 435]]

    (ii) Violations of the grantee's or subgrantee's protest procedures 
for failure to review a complaint or protest. Protests received by the 
Federal agency other than those specified above will be referred to the 
grantee or subgrantee.
    (c) Competition. (1) All procurement transactions will be conducted 
in a manner providing full and open competition consistent with the 
standards of Sec. 135.36. Some of the situations considered to be 
restrictive of competition include but are not limited to:
    (i) Placing unreasonable requirements on firms in order for them to 
qualify to do business,
    (ii) Requiring unnecessary experience and excessive bonding,
    (iii) Noncompetitive pricing practices between firms or between 
affiliated companies,
    (iv) Noncompetitive awards to consultants that are on retainer 
contracts,
    (v) Organizational conflicts of interest,
    (vi) Specifying only a ``brand name'' product instead of allowing 
``an equal'' product to be offered and describing the performance of 
other relevant requirements of the procurement, and
    (vii) Any arbitrary action in the procurement process.
    (2) Grantees and subgrantees will conduct procurements in a manner 
that prohibits the use of statutorily or administratively imposed in-
State or local geographical preferences in the evaluation of bids or 
proposals, except in those cases where applicable Federal statutes 
expressly mandate or encourage geographic preference. Nothing in this 
section preempts State licensing laws. When contracting for 
architectural and engineering (A/E) services, geographic location may be 
a selection criteria provided its application leaves an appropriate 
number of qualified firms, given the nature and size of the project, to 
compete for the contract.
    (3) Grantees will have written selection procedures for procurement 
transactions. These procedures will ensure that all solicitations:
    (i) Incorporate a clear and accurate description of the technical 
requirements for the material, product, or service to be procured. Such 
description shall not, in competitive procurements, contain features 
which unduly restrict competition. The description may include a 
statement of the qualitative nature of the material, product or service 
to be procured, and when necessary, shall set forth those minimum 
essential characteristics and standards to which it must conform if it 
is to satisfy its intended use. Detailed product specifications should 
be avoided if at all possible. When it is impractical or uneconomical to 
make a clear and accurate description of the technical requirements, a 
``brand name or equal'' description may be used as a means to define the 
performance or other salient requirements of a procurement. The specific 
features of the named brand which must be met by offerors shall be 
clearly stated; and
    (ii) Identify all requirements which the offerors must fulfill and 
all other factors to be used in evaluating bids or proposals.
    (4) Grantees and subgrantees will ensure that all prequalified lists 
of persons, firms, or products which are used in acquiring goods and 
services are current and include enough qualified sources to ensure 
maximum open and free competition. Also, grantees and subgrantees will 
not preclude potential bidders from qualifying during the solicitation 
period.
    (d) Methods of procurement to be followed--(1) Procurement by small 
purchase procedures. Small purchase procedures are those relatively 
simple and informal procurement methods for securing services, supplies, 
or other property that do not cost more than the simplified acquisition 
threshold fixed at 41 U.S.C. 403(11) (currently set at $100,000). If 
small purchase procedures are used, price or rate quotations shall be 
obtained from an adequate number of qualified sources.
    (2) Procurement by sealed bids (formal advertising). Bids are 
publicly solicited and a firm-fixed-price contract (lump sum or unit 
price) is awarded to the responsible bidder whose bid, conforming with 
all the material terms and conditions of the invitation for bids, is the 
lowest in price. The sealed bid method is the preferred method for 
procuring construction, if the conditions in Sec. 135.36(d)(2)(i) apply.

[[Page 436]]

    (i) In order for sealed bidding to be feasible, the following 
conditions should be present:
    (A) A complete, adequate, and realistic specification or purchase 
description is available;
    (B) Two or more responsible bidders are willing and able to compete 
effectively and for the business; and
    (C) The procurement lends itself to a firm fixed price contract and 
the selection of the successful bidder can be made principally on the 
basis of price.
    (ii) If sealed bids are used, the following requirements apply:
    (A) The invitation for bids will be publicly advertised and bids 
shall be solicited from an adequate number of known suppliers, providing 
them sufficient time prior to the date set for opening the bids;
    (B) The invitation for bids, which will include any specifications 
and pertinent attachments, shall define the items or services in order 
for the bidder to properly respond;
    (C) All bids will be publicly opened at the time and place 
prescribed in the invitation for bids;
    (D) A firm fixed-price contract award will be made in writing to the 
lowest responsive and responsible bidder. Where specified in bidding 
documents, factors such as discounts, transportation cost, and life 
cycle costs shall be considered in determining which bid is lowest. 
Payment discounts will only be used to determine the low bid when prior 
experience indicates that such discounts are usually taken advantage of; 
and
    (E) Any or all bids may be rejected if there is a sound documented 
reason.
    (3) Procurement by competitive proposals. The technique of 
competitive proposals is normally conducted with more than one source 
submitting an offer, and either a fixed-price or cost-reimbursement type 
contract is awarded. It is generally used when conditions are not 
appropriate for the use of sealed bids. If this method is used, the 
following requirements apply:
    (i) Requests for proposals will be publicized and identify all 
evaluation factors and their relative importance. Any response to 
publicized requests for proposals shall be honored to the maximum extent 
practical;
    (ii) Proposals will be solicited from an adequate number of 
qualified sources;
    (iii) Grantees and subgrantees will have a method for conducting 
technical evaluations of the proposals received and for selecting 
awardees;
    (iv) Awards will be made to the responsible firm whose proposal is 
most advantageous to the program, with price and other factors 
considered; and
    (v) Grantees and subgrantees may use competitive proposal procedures 
for qualifications-based procurement of architectural/engineering (A/E) 
professional services whereby competitors' qualifications are evaluated 
and the most qualified competitor is selected, subject to negotiation of 
fair and reasonable compensation. The method, where price is not used as 
a selection factor, can only be used in procurement of A/E professional 
services. It cannot be used to purchase other types of services though 
A/E firms are a potential source to perform the proposed effort.
    (4) Procurement by noncompetitive proposals is procurement through 
solicitation of a proposal from only one source, or after solicitation 
of a number of sources, competition is determined inadequate.
    (i) Procurement by noncompetitive proposals may be used only when 
the award of a contract is infeasible under small purchase procedures, 
sealed bids or competitive proposals and one of the following 
circumstances applies:
    (A) The item is available only from a single source;
    (B) The public exigency or emergency for the requirement will not 
permit a delay resulting from competitive solicitation;
    (C) The awarding agency authorizes noncompetitive proposals; or
    (D) After solicitation of a number of sources, competition is 
determined inadequate.
    (ii) Cost analysis, i.e., verifying the proposed cost data, the 
projections of the data, and the evaluation of the specific elements of 
costs and profits, is required.
    (iii) Grantees and subgrantees may be required to submit the 
proposed procurement to the awarding agency for

[[Page 437]]

pre-award review in accordance with paragraph (g) of this section.
    (e) Contracting with small and minority firms, women's business 
enterprise and labor surplus area firms. (1) The grantee and subgrantee 
will take all necessary affirmative steps to assure that minority firms, 
women's business enterprises, and labor surplus area firms are used when 
possible.
    (2) Affirmative steps shall include:
    (i) Placing qualified small and minority businesses and women's 
business enterprises on solicitation lists;
    (ii) Assuring that small and minority businesses, and women's 
business enterprises are solicited whenever they are potential sources;
    (iii) Dividing total requirements, when economically feasible, into 
smaller tasks or quantities to permit maximum participation by small and 
minority business, and women's business enterprises;
    (iv) Establishing delivery schedules, where the requirement permits, 
which encourage participation by small and minority business, and 
women's business enterprises;
    (v) Using the services and assistance of the Small Business 
Administration, and the Minority Business Development Agency of the 
Department of Commerce; and
    (vi) Requiring the prime contractor, if subcontracts are to be let, 
to take the affirmative steps listed in paragraphs (e)(2) (i) through 
(v) of this section.
    (f) Contract cost and price. (1) Grantees and subgrantees must 
perform a cost or price analysis in connection with every procurement 
action including contract modifications. The method and degree of 
analysis is dependent on the facts surrounding the particular 
procurement situation, but as a starting point, grantees must make 
independent estimates before receiving bids or proposals. A cost 
analysis must be performed when the offeror is required to submit the 
elements of his estimated cost, e.g., under professional, consulting, 
and architectural engineering services contracts. A cost analysis will 
be necessary when adequate price competition is lacking, and for sole 
source procurements, including contract modifications or change orders, 
unless price resonableness can be established on the basis of a catalog 
or market price of a commercial product sold in substantial quantities 
to the general public or based on prices set by law or regulation. A 
price analysis will be used in all other instances to determine the 
reasonableness of the proposed contract price.
    (2) Grantees and subgrantees will negotiate profit as a separate 
element of the price for each contract in which there is no price 
competition and in all cases where cost analysis is performed. To 
establish a fair and reasonable profit, consideration will be given to 
the complexity of the work to be performed, the risk borne by the 
contractor, the contractor's investment, the amount of subcontracting, 
the quality of its record of past performance, and industry profit rates 
in the surrounding geographical area for similar work.
    (3) Costs or prices based on estimated costs for contracts under 
grants will be allowable only to the extent that costs incurred or cost 
estimates included in negotiated prices are consistent with Federal cost 
principles (see Sec. 135.22). Grantees may reference their own cost 
principles that comply with the applicable Federal cost principles.
    (4) The cost plus a percentage of cost and percentage of 
construction cost methods of contracting shall not be used.
    (g) Awarding agency review. (1) Grantees and subgrantees must make 
available, upon request of the awarding agency, technical specifications 
on proposed procurements where the awarding agency believes such review 
is needed to ensure that the item and/or service specified is the one 
being proposed for purchase. This review generally will take place prior 
to the time the specification is incorporated into a solicitation 
document. However, if the grantee or subgrantee desires to have the 
review accomplished after a solicitation has been developed, the 
awarding agency may still review the specifications, with such review 
usually limited to the technical aspects of the proposed purchase.
    (2) Grantees and subgrantees must on request make available for 
awarding agency pre-award review procurement

[[Page 438]]

documents, such as requests for proposals or invitations for bids, 
independent cost estimates, etc. when:
    (i) A grantee's or subgrantee's procurement procedures or operation 
fails to comply with the procurement standards in this section; or
    (ii) The procurement is expected to exceed the simplified 
acquisition threshold and is to be awarded without competition or only 
one bid or offer is received in response to a solicitation; or
    (iii) The procurement, which is expected to exceed the simplified 
acquisition threshold, specifies a ``brand name'' product; or
    (iv) The proposed award is more than the simplified acquisition 
threshold and is to be awarded to other than the apparent low bidder 
under a sealed bid procurement; or
    (v) A proposed contract modification changes the scope of a contract 
or increases the contract amount by more than the simplified acquisition 
threshold.
    (3) A grantee or subgrantee will be exempt from the pre-award review 
in paragraph (g)(2) of this section if the awarding agency determines 
that its procurement systems comply with the standards of this section.
    (i) A grantee or subgrantee may request that its procurement system 
be reviewed by the awarding agency to determine whether its system meets 
these standards in order for its system to be certified. Generally, 
these reviews shall occur where there is a continuous high-dollar 
funding, and third-party contracts are awarded on a regular basis.
    (ii) A grantee or subgrantee may self-certify its procurement 
system. Such self-certification shall not limit the awarding agency's 
right to survey the system. Under a self-certification procedure, 
awarding agencies may wish to rely on written assurances from the 
grantee or subgrantee that it is complying with these standards. A 
grantee or subgrantee will cite specific procedures, regulations, 
standards, etc., as being in compliance with these requirements and have 
its system available for review.
    (h) Bonding requirements. For construction or facility improvement 
contracts or subcontracts exceeding the simplified acquisition 
threshold, the awarding agency may accept the bonding policy and 
requirements of the grantee or subgrantee provided the awarding agency 
has made a determination that the awarding agency's interest is 
adequately protected. If such a determination has not been made, the 
minimum requirements shall be as follows:
    (1) A bid guarantee from each bidder equivalent to five percent of 
the bid price. The ``bid guarantee'' shall consist of a firm commitment 
such as a bid bond, certified check, or other negotiable instrument 
accompanying a bid as assurance that the bidder will, upon acceptance of 
his bid, execute such contractual documents as may be required within 
the time specified.
    (2) A performance bond on the part of the contractor for 100 percent 
of the contract price. A ``performance bond'' is one executed in 
connection with a contract to secure fulfillment of all the contractor's 
obligations under such contract.
    (3) A payment bond on the part of the contractor for 100 percent of 
the contract price. A ``payment bond'' is one executed in connection 
with a contract to assure payment as required by law of all persons 
supplying labor and material in the execution of the work provided for 
in the contract.
    (i) Contract provisions. A grantee's and subgrantee's contracts must 
contain provisions in paragraph (i) of this section. Federal agencies 
are permitted to require changes, remedies, changed conditions, access 
and records retention, suspension of work, and other clauses approved by 
the Office of Federal Procurement Policy.
    (1) Administrative, contractual, or legal remedies in instances 
where contractors violate or breach contract terms, and provide for such 
sanctions and penalties as may be appropriate. (Contracts more than the 
simplified acquisition threshold)
    (2) Termination for cause and for convenience by the grantee or 
subgrantee including the manner by which it will be effected and the 
basis for settlement. (All contracts in excess of $10,000)

[[Page 439]]

    (3) Compliance with Executive Order 11246 of September 24, 1965, 
entitled ``Equal Employment Opportunity,'' as amended by Executive Order 
11375 of October 13, 1967, and as supplemented in Department of Labor 
regulations (41 CFR chapter 60). (All construction contracts awarded in 
excess of $10,000 by grantees and their contractors or subgrantees)
    (4) Compliance with the Copeland ``Anti-Kickback'' Act (18 U.S.C. 
874) as supplemented in Department of Labor regulations (29 CFR Part 3). 
(All contracts and subgrants for construction or repair)
    (5) Compliance with the Davis-Bacon Act (40 U.S.C. 276a to 276a-7) 
as supplemented by Department of Labor regulations (29 CFR Part 5). 
(Construction contracts in excess of $2000 awarded by grantees and 
subgrantees when required by Federal grant program legislation)
    (6) Compliance with Sections 103 and 107 of the Contract Work Hours 
and Safety Standards Act (40 U.S.C. 327-330) as supplemented by 
Department of Labor regulations (29 CFR Part 5). (Construction contracts 
awarded by grantees and subgrantees in excess of $2000, and in excess of 
$2500 for other contracts which involve the employment of mechanics or 
laborers)
    (7) Notice of awarding agency requirements and regulations 
pertaining to reporting.
    (8) Notice of awarding agency requirements and regulations 
pertaining to patent rights with respect to any discovery or invention 
which arises or is developed in the course of or under such contract.
    (9) Awarding agency requirements and regulations pertaining to 
copyrights and rights in data.
    (10) Access by the grantee, the subgrantee, the Federal grantor 
agency, the Comptroller General of the United States, or any of their 
duly authorized representatives to any books, documents, papers, and 
records of the contractor which are directly pertinent to that specific 
contract for the purpose of making audit, examination, excerpts, and 
transcriptions.
    (11) Retention of all required records for three years after 
grantees or subgrantees make final payments and all other pending 
matters are closed.
    (12) Compliance with all applicable standards, orders, or 
requirements issued under section 306 of the Clean Air Act (42 U.S.C. 
1857(h)), section 508 of the Clean Water Act (33 U.S.C. 1368), Executive 
Order 11738, and Environmental Protection Agency regulations (40 CFR 
part 15). (Contracts, subcontracts, and subgrants of amounts in excess 
of $100,000).
    (13) Mandatory standards and policies relating to energy efficiency 
which are contained in the state energy conservation plan issued in 
compliance with the Energy Policy and Conservation Act (Pub. L. 94-163, 
89 Stat. 871).
[53 FR 8049, 8087, Mar. 11, 1988, as amended at 60 FR 19639, 19642, Apr. 
19, 1995]



Sec. 135.37  Subgrants.

    (a) States. States shall follow state law and procedures when 
awarding and administering subgrants (whether on a cost reimbursement or 
fixed amount basis) of financial assistance to local and Indian tribal 
governments. States shall:
    (1) Ensure that every subgrant includes any clauses required by 
Federal statute and executive orders and their implementing regulations;
    (2) Ensure that subgrantees are aware of requirements imposed upon 
them by Federal statute and regulation;
    (3) Ensure that a provision for compliance with Sec. 135.42 is 
placed in every cost reimbursement subgrant; and
    (4) Conform any advances of grant funds to subgrantees substantially 
to the same standards of timing and amount that apply to cash advances 
by Federal agencies.
    (b) All other grantees. All other grantees shall follow the 
provisions of this part which are applicable to awarding agencies when 
awarding and administering subgrants (whether on a cost reimbursement or 
fixed amount basis) of financial assistance to local and Indian tribal 
governments. Grantees shall:
    (1) Ensure that every subgrant includes a provision for compliance 
with this part;
    (2) Ensure that every subgrant includes any clauses required by 
Federal

[[Page 440]]

statute and executive orders and their implementing regulations; and
    (3) Ensure that subgrantees are aware of requirements imposed upon 
them by Federal statutes and regulations.
    (c) Exceptions. By their own terms, certain provisions of this part 
do not apply to the award and administration of subgrants:
    (1) Section 135.10;
    (2) Section 135.11;
    (3) The letter-of-credit procedures specified in Treasury 
Regulations at 31 CFR part 205, cited in Sec. 135.21; and
    (4) Section 135.50.

              Reports, Records, Retention, and Enforcement



Sec. 135.40  Monitoring and reporting program performance.

    (a) Monitoring by grantees. Grantees are responsible for managing 
the day-to-day operations of grant and subgrant supported activities. 
Grantees must monitor grant and subgrant supported activities to assure 
compliance with applicable Federal requirements and that performance 
goals are being achieved. Grantee monitoring must cover each program, 
function or activity.
    (b) Nonconstruction performance reports. The Federal agency may, if 
it decides that performance information available from subsequent 
applications contains sufficient information to meet its programmatic 
needs, require the grantee to submit a performance report only upon 
expiration or termination of grant support. Unless waived by the Federal 
agency this report will be due on the same date as the final Financial 
Status Report.
    (1) Grantees shall submit annual performance reports unless the 
awarding agency requires quarterly or semi-annual reports. However, 
performance reports will not be required more frequently than quarterly. 
Annual reports shall be due 90 days after the grant year, quarterly or 
semi-annual reports shall be due 30 days after the reporting period. The 
final performance report will be due 90 days after the expiration or 
termination of grant support. If a justified request is submitted by a 
grantee, the Federal agency may extend the due date for any performance 
report. Additionally, requirements for unnecessary performance reports 
may be waived by the Federal agency.
    (2) Performance reports will contain, for each grant, brief 
information on the following:
    (i) A comparison of actual accomplishments to the objectives 
established for the period. Where the output of the project can be 
quantified, a computation of the cost per unit of output may be required 
if that information will be useful.
    (ii) The reasons for slippage if established objectives were not 
met.
    (iii) Additional pertinent information including, when appropriate, 
analysis and explanation of cost overruns or high unit costs.
    (3) Grantees will not be required to submit more than the original 
and two copies of performance reports.
    (4) Grantees will adhere to the standards in this section in 
prescribing performance reporting requirements for subgrantees.
    (c) Construction performance reports. For the most part, on-site 
technical inspections and certified percentage-of-completion data are 
relied on heavily by Federal agencies to monitor progress under 
construction grants and subgrants. The Federal agency will require 
additional formal performance reports only when considered necessary, 
and never more frequently than quarterly.
    (d) Significant developments. Events may occur between the scheduled 
performance reporting dates which have significant impact upon the grant 
or subgrant supported activity. In such cases, the grantee must inform 
the Federal agency as soon as the following types of conditions become 
known:
    (1) Problems, delays, or adverse conditions which will materially 
impair the ability to meet the objective of the award. This disclosure 
must include a statement of the action taken, or contemplated, and any 
assistance needed to resolve the situation.
    (2) Favorable developments which enable meeting time schedules and 
objectives sooner or at less cost than anticipated or producing more 
beneficial results than originally planned.

[[Page 441]]

    (e) Federal agencies may make site visits as warranted by program 
needs.
    (f) Waivers, extensions. (1) Federal agencies may waive any 
performance report required by this part if not needed.
    (2) The grantee may waive any performance report from a subgrantee 
when not needed. The grantee may extend the due date for any performance 
report from a subgrantee if the grantee will still be able to meet its 
performance reporting obligations to the Federal agency.



Sec. 135.41  Financial reporting.

    (a) General. (1) Except as provided in paragraphs (a) (2) and (5) of 
this section, grantees will use only the forms specified in paragraphs 
(a) through (e) of this section, and such supplementary or other forms 
as may from time to time be authorized by OMB, for:
    (i) Submitting financial reports to Federal agencies, or
    (ii) Requesting advances or reimbursements when letters of credit 
are not used.
    (2) Grantees need not apply the forms prescribed in this section in 
dealing with their subgrantees. However, grantees shall not impose more 
burdensome requirements on subgrantees.
    (3) Grantees shall follow all applicable standard and supplemental 
Federal agency instructions approved by OMB to the extend required under 
the Paperwork Reduction Act of 1980 for use in connection with forms 
specified in paragraphs (b) through (e) of this section. Federal 
agencies may issue substantive supplementary instructions only with the 
approval of OMB. Federal agencies may shade out or instruct the grantee 
to disregard any line item that the Federal agency finds unnecessary for 
its decisionmaking purposes.
    (4) Grantees will not be required to submit more than the original 
and two copies of forms required under this part.
    (5) Federal agencies may provide computer outputs to grantees to 
expedite or contribute to the accuracy of reporting. Federal agencies 
may accept the required information from grantees in machine usable 
format or computer printouts instead of prescribed forms.
    (6) Federal agencies may waive any report required by this section 
if not needed.
    (7) Federal agencies may extend the due date of any financial report 
upon receiving a justified request from a grantee.
    (b) Financial Status Report--(1) Form. Grantees will use Standard 
Form 269 or 269A, Financial Status Report, to report the status of funds 
for all nonconstruction grants and for construction grants when required 
in accordance with Sec. 135.41(e)(2)(iii) of this section.
    (2) Accounting basis. Each grantee will report program outlays and 
program income on a cash or accrual basis as prescribed by the awarding 
agency. If the Federal agency requires accrual information and the 
grantee's accounting records are not normally kept on the accural basis, 
the grantee shall not be required to convert its accounting system but 
shall develop such accrual information through and analysis of the 
documentation on hand.
    (3) Frequency. The Federal agency may prescribe the frequency of the 
report for each project or program. However, the report will not be 
required more frequently than quarterly. If the Federal agency does not 
specify the frequency of the report, it will be submitted annually. A 
final report will be required upon expiration or termination of grant 
support.
    (4) Due date. When reports are required on a quarterly or semiannual 
basis, they will be due 30 days after the reporting period. When 
required on an annual basis, they will be due 90 days after the grant 
year. Final reports will be due 90 days after the expiration or 
termination of grant support.
    (c) Federal Cash Transactions Report--(1) Form. (i) For grants paid 
by letter or credit, Treasury check advances or electronic transfer of 
funds, the grantee will submit the Standard Form 272, Federal Cash 
Transactions Report, and when necessary, its continuation sheet, 
Standard Form 272a, unless the terms of the award exempt the grantee 
from this requirement.
    (ii) These reports will be used by the Federal agency to monitor 
cash advanced to grantees and to obtain disbursement or outlay 
information for

[[Page 442]]

each grant from grantees. The format of the report may be adapted as 
appropriate when reporting is to be accomplished with the assistance of 
automatic data processing equipment provided that the information to be 
submitted is not changed in substance.
    (2) Forecasts of Federal cash requirements. Forecasts of Federal 
cash requirements may be required in the ``Remarks'' section of the 
report.
    (3) Cash in hands of subgrantees. When considered necessary and 
feasible by the Federal agency, grantees may be required to report the 
amount of cash advances in excess of three days' needs in the hands of 
their subgrantees or contractors and to provide short narrative 
explanations of actions taken by the grantee to reduce the excess 
balances.
    (4) Frequency and due date. Grantees must submit the report no later 
than 15 working days following the end of each quarter. However, where 
an advance either by letter of credit or electronic transfer of funds is 
authorized at an annualized rate of one million dollars or more, the 
Federal agency may require the report to be submitted within 15 working 
days following the end of each month.
    (d) Request for advance or reimbursement--(1) Advance payments. 
Requests for Treasury check advance payments will be submitted on 
Standard Form 270, Request for Advance or Reimbursement. (This form will 
not be used for drawdowns under a letter of credit, electronic funds 
transfer or when Treasury check advance payments are made to the grantee 
automatically on a predetermined basis.)
    (2) Reimbursements. Requests for reimbursement under nonconstruction 
grants will also be submitted on Standard Form 270. (For reimbursement 
requests under construction grants, see paragraph (e)(1) of this 
section.)
    (3) The frequency for submitting payment requests is treated in 
Sec. 135.41(b)(3).
    (e) Outlay report and request for reimbursement for construction 
programs--(1) Grants that support construction activities paid by 
reimbursement method. (i) Requesters for reimbursement under 
construction grants will be submitted on Standard Form 271, Outlay 
Report and Request for Reimbursement for Construction Programs. Federal 
agencies may, however, prescribe the Request for Advance or 
Reimbursement form, specified in Sec. 135.41(d), instead of this form.
    (ii) The frequency for submitting reimbursement requests is treated 
in Sec. 135.41(b)(3).
    (2) Grants that support construction activities paid by letter of 
credit, electronic funds transfer or Treasury check advance. (i) When a 
construction grant is paid by letter of credit, electronic funds 
transfer or Treasury check advances, the grantee will report its outlays 
to the Federal agency using Standard Form 271, Outlay Report and Request 
for Reimbursement for Construction Programs. The Federal agency will 
provide any necessary special instruction. However, frequency and due 
date shall be governed by Sec. 135.41(b) (3) and (4).
    (ii) When a construction grant is paid by Treasury check advances 
based on periodic requests from the grantee, the advances will be 
requested on the form specified in Sec. 135.41(d).
    (iii) The Federal agency may substitute the Financial Status Report 
specified in Sec. 135.41(b) for the Outlay Report and Request for 
Reimbursement for Construction Programs.
    (3) Accounting basis. The accounting basis for the Outlay Report and 
Request for Reimbursement for Construction Programs shall be governed by 
Sec. 135.41(b)(2).



Sec. 135.42  Retention and access requirements for records.

    (a) Applicability. (1) This section applies to all financial and 
programmatic records, supporting documents, statistical records, and 
other records of grantees or subgrantees which are:
    (i) Required to be maintained by the terms of this part, program 
regulations or the grant agreement, or
    (ii) Otherwise reasonably considered as pertinent to program 
regulations or the grant agreement.
    (2) This section does not apply to records maintained by contractors 
or subcontractors. For a requirement to place a provision concerning 
records in certain kinds of contracts, see Sec. 135.36(i)(10).

[[Page 443]]

    (b) Length of retention period. (1) Except as otherwise provided, 
records must be retained for three years from the starting date 
specified in paragraph (c) of this section.
    (2) If any litigation, claim, negotiation, audit or other action 
involving the records has been started before the expiration of the 3-
year period, the records must be retained until completion of the action 
and resolution of all issues which arise from it, or until the end of 
the regular 3-year period, whichever is later.
    (3) To avoid duplicate recordkeeping, awarding agencies may make 
special arrangements with grantees and subgrantees to retain any records 
which are continuously needed for joint use. The awarding agency will 
request transfer of records to its custody when it determines that the 
records possess long-term retention value. When the records are 
transferred to or maintained by the Federal agency, the 3-year retention 
requirement is not applicable to the grantee or subgrantee.
    (c) Starting date of retention period--(1) General. When grant 
support is continued or renewed at annual or other intervals, the 
retention period for the records of each funding period starts on the 
day the grantee or subgrantee submits to the awarding agency its single 
or last expenditure report for that period. However, if grant support is 
continued or renewed quarterly, the retention period for each year's 
records starts on the day the grantee submits its expenditure report for 
the last quarter of the Federal fiscal year. In all other cases, the 
retention period starts on the day the grantee submits its final 
expenditure report. If an expenditure report has been waived, the 
retention period starts on the day the report would have been due.
    (2) Real property and equipment records. The retention period for 
real property and equipment records starts from the date of the 
disposition or replacement or transfer at the direction of the awarding 
agency.
    (3) Records for income transactions after grant or subgrant support. 
In some cases grantees must report income after the period of grant 
support. Where there is such a requirement, the retention period for the 
records pertaining to the earning of the income starts from the end of 
the grantee's fiscal year in which the income is earned.
    (4) Indirect cost rate proposals, cost allocations plans, etc. This 
paragraph applies to the following types of documents, and their 
supporting records: Indirect cost rate computations or proposals, cost 
allocation plans, and any similar accounting computations of the rate at 
which a particular group of costs is chargeable (such as computer usage 
chargeback rates or composite fringe benefit rates).
    (i) If submitted for negotiation. If the proposal, plan, or other 
computation is required to be submitted to the Federal Government (or to 
the grantee) to form the basis for negotiation of the rate, then the 3-
year retention period for its supporting records starts from the date of 
such submission.
    (ii) If not submitted for negotiation. If the proposal, plan, or 
other computation is not required to be submitted to the Federal 
Government (or to the grantee) for negotiation purposes, then the 3-year 
retention period for the proposal plan, or computation and its 
supporting records starts from end of the fiscal year (or other 
accounting period) covered by the proposal, plan, or other computation.
    (d) Substitution of microfilm. Copies made by microfilming, 
photocopying, or similar methods may be substituted for the original 
records.
    (e) Access to records--(1) Records of grantees and subgrantees. The 
awarding agency and the Comptroller General of the United States, or any 
of their authorized representatives, shall have the right of access to 
any pertinent books, documents, papers, or other records of grantees and 
subgrantees which are pertinent to the grant, in order to make audits, 
examinations, excerpts, and transcripts.
    (2) Expiration of right of access. The rights of access in this 
section must not be limited to the required retention period but shall 
last as long as the records are retained.
    (f) Restrictions on public access. The Federal Freedom of 
Information Act (5 U.S.C. 552) does not apply to records Unless required 
by Federal, State, or local law, grantees and subgrantees are

[[Page 444]]

not required to permit public access to their records.



Sec. 135.43  Enforcement.

    (a) Remedies for noncompliance. If a grantee or subgrantee 
materially fails to comply with any term of an award, whether stated in 
a Federal statute or regulation, an assurance, in a State plan or 
application, a notice of award, or elsewhere, the awarding agency may 
take one or more of the following actions, as appropriate in the 
circumstances:
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the grantee or subgrantee or more severe enforcement 
action by the awarding agency,
    (2) Disallow (that is, deny both use of funds and matching credit 
for) all or part of the cost of the activity or action not in 
compliance,
    (3) Wholly or partly suspend or terminate the current award for the 
grantee's or subgrantee's program,
    (4) Withhold further awards for the program, or
    (5) Take other remedies that may be legally available.
    (b) Hearings, appeals. In taking an enforcement action, the awarding 
agency will provide the grantee or subgrantee an opportunity for such 
hearing, appeal, or other administrative proceeding to which the grantee 
or subgrantee is entitled under any statute or regulation applicable to 
the action involved.
    (c) Effects of suspension and termination. Costs of grantee or 
subgrantee resulting from obligations incurred by the grantee or 
subgrantee during a suspension or after termination of an award are not 
allowable unless the awarding agency expressly authorizes them in the 
notice of suspension or termination or subsequently. Other grantee or 
subgrantee costs during suspension or after termination which are 
necessary and not reasonably avoidable are allowable if:
    (1) The costs result from obligations which were properly incurred 
by the grantee or subgrantee before the effective date of suspension or 
termination, are not in anticipation of it, and, in the case of a 
termination, are noncancellable, and,
    (2) The costs would be allowable if the award were not suspended or 
expired normally at the end of the funding period in which the 
termination takes effect.
    (d) Relationship to debarment and suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude grantee or subgrantee from being subject to 
``Debarment and Suspension'' under E.O. 12549 (see Sec. 135.35).



Sec. 135.44  Termination for convenience.

    Except as provided in Sec. 135.43 awards may be terminated in whole 
or in part only as follows:
    (a) By the awarding agency with the consent of the grantee or 
subgrantee in which case the two parties shall agree upon the 
termination conditions, including the effective date and in the case of 
partial termination, the portion to be terminated, or
    (b) By the grantee or subgrantee upon written notification to the 
awarding agency, setting forth the reasons for such termination, the 
effective date, and in the case of partial termination, the portion to 
be terminated. However, if, in the case of a partial termination, the 
awarding agency determines that the remaining portion of the award will 
not accomplish the purposes for which the award was made, the awarding 
agency may terminate the award in its entirety under either Sec. 135.43 
or paragraph (a) of this section.



                 Subpart D--After-The-Grant Requirements



Sec. 135.50  Closeout.

    (a) General. The Federal agency will close out the award when it 
determines that all applicable administrative actions and all required 
work of the grant has been completed.
    (b) Reports. Within 90 days after the expiration or termination of 
the grant, the grantee must submit all financial, performance, and other 
reports required as a condition of the grant. Upon request by the 
grantee, Federal agencies may extend this timeframe. These may include 
but are not limited to:
    (1) Final performance or progress report.

[[Page 445]]

    (2) Financial Status Report (SF 269) or Outlay Report and Request 
for Reimbursement for Construction Programs (SF-271) (as applicable).
    (3) Final request for payment (SF-270) (if applicable).
    (4) Invention disclosure (if applicable).
    (5) Federally-owned property report. In accordance with 
Sec. 135.32(f), a grantee must submit an inventory of all federally 
owned property (as distinct from property acquired with grant funds) for 
which it is accountable and request disposition instructions from the 
Federal agency of property no longer needed.
    (c) Cost adjustment. The Federal agency will, within 90 days after 
receipt of reports in paragraph (b) of this section, make upward or 
downward adjustments to the allowable costs.
    (d) Cash adjustments. (1) The Federal agency will make prompt 
payment to the grantee for allowable reimbursable costs.
    (2) The grantee must immediately refund to the Federal agency any 
balance of unobligated (unencumbered) cash advanced that is not 
authorized to be retained for use on other grants.



Sec. 135.51  Later disallowances and adjustments.

    The closeout of a grant does not affect:
    (a) The Federal agency's right to disallow costs and recover funds 
on the basis of a later audit or other review;
    (b) The grantee's obligation to return any funds due as a result of 
later refunds, corrections, or other transactions;
    (c) Records retention as required in Sec. 135.42;
    (d) Property management requirements in Secs. 135.31 and 135.32; and
    (e) Audit requirements in Sec. 135.26.



Sec. 135.52  Collection of amounts due.

    (a) Any funds paid to a grantee in excess of the amount to which the 
grantee is finally determined to be entitled under the terms of the 
award constitute a debt to the Federal Government. If not paid within a 
reasonable period after demand, the Federal agency may reduce the debt 
by:
    (1) Making an adminstrative offset against other requests for 
reimbursements,
    (2) Withholding advance payments otherwise due to the grantee, or
    (3) Other action permitted by law.
    (b) Except where otherwise provided by statutes or regulations, the 
Federal agency will charge interest on an overdue debt in accordance 
with the Federal Claims Collection Standards (4 CFR Ch. II). The date 
from which interest is computed is not extended by litigation or the 
filing of any form of appeal.



                   Subpart E--Entitlements [Reserved]



PART 136--PERSONAL PROPERTY DISPOSITION AT POSTS ABROAD--Table of Contents




Sec.
136.1  Purpose.
136.2  Authority.
136.3  Definitions.
136.4  Restrictions on dispositions of personal property.
136.5  Chief of mission policies, rules or procedures.
136.6  Contractors.

    Authority:  22 U.S.C. 4341.

    Source:  53 FR 23188, June 20, 1988, unless otherwise noted.



Sec. 136.1  Purpose.

    The primary purpose of these regulations is to ensure that employees 
and members of their families do not profit personally from sales or 
other transactions with persons who are not themselves entitled to 
exemption from import restrictions, duties, or taxes.



Sec. 136.2  Authority.

    Section 303(a) of the State Department Basic Authorities Act of 1956 
authorizes the Secretary of State to issue regulations to carry out the 
purposes of title III of that Act.



Sec. 136.3  Definitions.

    (a) Basis of an item shall include the initial price paid (or retail 
value at the time of acquisition if acquired by gift), inland and 
overseas transportation costs (if not reimbursed by the United States 
Government), shipping insurance, taxes, customs fees, duties or

[[Page 446]]

other charges, and capital improvements, but shall not include insurance 
on an item while in use or storage, maintenance, repair or related 
costs, or financing charges.
    (b) Charitable contribution means a contribution or gift as defined 
in section 170(c) of the Internal Revenue Code, or other similar 
contribution or gift to a bona fide charitable foreign entity as 
determined pursuant to policies, rules or procedures issued by the chief 
of mission pursuant to Sec. 136.5(b).
    (c) Chief of mission has the meaning given such term by section 
102(e) of the Foreign Service Act of 1980 (22 U.S.C. 2902(3).
    (d) Contractor means: (1) An individual employed by personal 
services contract pursuant to section 2(c) of the State Department Basic 
Authorities Act of 1956 (22 U.S.C. 2669(c)), pursuant to section 
636(a)(3) of the Foreign Assistance Act of 1961 (22 U.S.C. 2396(a)(3)), 
or pursuant to any other similar authority including, in the case of an 
organization performing services under such authority, an individual 
involved in the performance of such service; and (2) any other 
individual or firm that enjoys exemptions from import limitations, 
customs duties or taxes on personal property from a foreign country in 
connection with performance of a contract for goods or services when 
such contract is with the United States Government or an agency or 
instrumentality thereof or when such contract is directly financed by 
grant assistance from the United States Government or an agency or 
instrumentality thereof and the individual or firm is a party to the 
contract, a subcontractor, or an employee of a contractor or 
subcontractor.
    (e) Employee means an individual who is under the jurisdiction of a 
chief of mission to a foreign country as provided under section 207 of 
the Foreign Service Act of 1980. (22 U.S.C. 3927) and who is--
    (1) An employee as defined by section 2105 of title 5, United States 
Code;
    (2) An officer or employee of the United States Postal Service or of 
the Postal Rate Commission;
    (3) A member of a uniformed service who is not under the command of 
an area military commander, or
    (4) An expert or consultant as authorized pursuant to section 3109 
of title 5, United States Code, with the United States or any agency, 
department, or establishment thereof; but is not a national or permanent 
resident of the foreign country in which employed.
    (f) Family member means any member of the family of an employee who 
is entitled to exemption from import limitation, customs duties, or 
taxes which would otherwise apply by virtue of his or her status as a 
dependent or member of the household of the employee.
    (g) Foreign country means any country or territory, excluding the 
United States, the Commonwealth of Puerto Rico, the Commonwealth of the 
Northern Mariana Islands, the Trust Territory of the Pacific Islands, 
American Samoa, Guam, the Virgin Islands, and other territories and 
possessions of the United States.
    (h) Except as otherwise provided by a chief of mission in policies, 
rules or procedures issued pursuant to Sec. 136.5(b), an item shall be 
deemed of ``minimal value'' if its acquisition cost in U.S. dollars (or 
retail value if received as a gift) is within the limit determined by 
the Administrator of General Services for ``minimal value'' of foreign 
gifts under 5 U.S.C. 7342, currently $180. For purposes of determining 
``minimal value,'' all constitutent parts of components of an audio or 
visual system, automobile, boat, computer system, or other integrated 
machine, system or item of equipment must be valued as a single item 
even if acquired separately, except that spare or superseded parts 
(e.g., an old set of tires that has been replaced on vehicle) may be 
valued as separate items.
    (i) Personal property means any item of personal property, including 
automobiles, computers, boats, audio and video equipment and any other 
items acquired for personal use, except that items properly determined 
to be of ``minimal value'' shall not be subject to limitations on 
disposition except for purposes of Sec. 136.4(d) or as prescribed in 
policies, rules or procedures issued by a chief of mission.
    (j) Profit means any proceeds (including cash and other valuable 
consideration but not including amounts of

[[Page 447]]

such proceeds given as charitable contributions) for the sale, 
disposition or assignment of personal property in excess of the basis 
for such property.



Sec. 136.4  Restrictions on dispositions of personal property.

    (a) An employee or family member shall not sell, assign or otherwise 
dispose of personal property within a foreign country except with the 
prior written approval of the chief of mission or designee, except where 
the category of dispositions has been authorized to be undertaken 
without prior written approval in policies, rules or procedures issued 
by the chief of mission (cf. Sec. 136.5(b)(1)).
    (b) An employee or family member shall not retain any profit from 
the sale, assignment or other disposition within a foreign country of 
personal property that was imported into or purchased in that foreign 
country and that, by virtue of the official status of the employee, was 
exempt from import restrictions, customs duties, or taxes which would 
otherwise apply, when such sale, assignment or other disposition is made 
to persons not entitled to exemptions from import restrictions, duties, 
or taxes. An employee or family member shall not profit from an indirect 
disposition to persons not entitled to such exemptions, such as sale 
through a third country diplomat acting as a middleman, where the 
employee or family member knows or should know that the property is 
being acquired by the third party for resale to persons not entitled to 
exemptions, except that this restriction shall not apply to sales of 
personal property to official agencies of the foreign country in 
accordance with the laws or regulations of that country.
    (c) Profits obtained from dispositions of personal property by an 
employee or family member that cannot be retained under paragraph (b) of 
this section including any interest earned by the employee or family 
member on such profits, shall be disposed of within 90 days of receipt 
by contribution or gift as defined in section 170(c) of the Internal 
Revenue Code or by other similar contribution or gift to a bona fide 
charitable foreign entity as designated by the chief of mission pursuant 
to Sec. 136.5(b)(11) of this part.
    (d) Except as authorized in advance by the chief of mission on a 
case-by-case basis, no employee or family member shall sell, assign or 
otherwise dispose of personal property within a foreign country that was 
not acquired for bona fide personal use. There shall be a presumption 
that property that is new, unused or held by the employer or family 
member in unusual or commercial quantities was not acquired for bona 
fide personal use. For purposes of this subsection, there is no 
exemption for items of minimal value Sec. 136.3(h)).
    (e) No employee or family member shall import, sell, assign or 
otherwise dispose of personal property within a foreign country in a 
manner that violates the law or regulations of that country or governing 
international law.
    (f) Violations of the restrictions or requirements of paragraphs (a) 
through (e) of this section shall be grounds for disciplinary actions 
against the employee in accordance with the employing agency's 
procedures and regulations. Employees shall be responsible for ensuring 
compliance with these regulations by family members.
    (g) For purposes of computing profits on personal property 
dispositions subject to these regulations, where acquisition and 
disposition of the property were transacted in different currencies, 
proceeds received and costs incurred in a foreign currency shall be 
valued in United States dollars at the time of receipt or payment at the 
rate of exchange that was in effect for reverse accommodation exchanges 
at U.S. missions at the time of such receipt or payment. Where property 
was acquired and sold in the same currency, no conversion is required.



Sec. 136.5  Chief of mission policies, rules or procedures.

    (a) Each chief of mission shall establish a procedure under which 
employees may request approval for the sale of personal property and for 
conversion of proceeds of such sale from local currency into U.S. 
dollars, if applicable. This procedure may be modified to meet local 
conditions, but must

[[Page 448]]

produce a documentary record to be held by the post of the following:
    (1) The employee's signed request for permission to sell personal 
property, and, if applicable, to convert local currency proceeds to U.S. 
dollars;
    (2) A description of each item of personal property having more than 
minimal value, and the cost basis and actual sales price for each item;
    (3) All profits received and whether profit is retainable;
    (4) Donation to charities or other authorized recipients of non-
retainable profits;
    (5) Approvals to sell and, if applicable, to exchange proceeds, with 
any restrictions or refusals of the employee's request noted, signed by 
the chief of mission or designee; and
    (6) For privately owned vehicle transactions, data on purchaser and 
statement that customs requirements have been met and title has been 
transferred or arranged with an agent identified on document.
    (b) In order to ensure that due account is taken of local 
conditions, including applicable laws, markets, exchange rate factors, 
and accommodation exchange facilities, the chief of mission to each 
foreign country is authorized to establish policies, rules, and 
procedures governing the disposition of personal property by employees 
and family members in that country under the chief of mission's 
jurisdiction. Policies, rules and procedures issued by the chief of 
mission shall be consistent with the general restrictions set forth in 
Sec. 136.4 and may include at least the following:
    (1) Identification of categories of dispositions (e.g., sales of 
minimal value items) that may be made without prior written approval;
    (2) Identification of categories of individuals or entities to whom 
sales of personal property can be made without restrictions on profits 
(e.g., other employees, third country diplomats), individuals or 
entities to whom sales can be made but profits not retained, and 
individuals or entities to whom sales may not be made;
    (3) Requirements to report the total estimated and actual proceeds 
for all minimal value items, even if such items are otherwise exempted 
from limitations on profits of sale;
    (4) Categories of items of personal property excluded from 
restrictions on disposition because generally exempt from taxation and 
import duties under local law;
    (5) More restrictive definition of ``minimal value'' (see 
Sec. 136.3(h) of this part);
    (6) Limitations on manner of disposition (e.g., restrictions on 
advertising or yard sales);
    (7) Limitations on total proceeds that may be generated by 
dispositions of personal property, including limitations on proceeds 
from disposition of ``minimal value'' items;
    (8) Limitations on total profits that may be generated by 
dispositions of personal property, including limitations on profits from 
dispositions of ``minimal value'' items;
    (9) Limitations on total proceeds from dispositions of personal 
property that may be converted into dollars by reverse accommodation 
exchange;
    (10) Limitations on the timing and number of reverse accommodation 
exchanges permitted for proceeds of dispositions of personal property 
(e.g., only in last six months of tour and no more than two exchange 
conversions);
    (11) Designation of bona fide charitable foreign entities to whom an 
employee or family member may donate profits that cannot be retained 
under these regulations.
    (12) Designation of post officials authorized to approve on behalf 
of chief of mission employee requests for permission to sell personal 
property and requests to convert local currency proceeds of sale to U.S. 
dollars by reverse accommodation exchange.
    (c) All policies, rules, and procedures that are issued by the chief 
of mission pursuant to paragraphs (a) and (b) of this section shall be 
announced by notice circulated to all affected mission employees and 
copies of all such policies, rules and procedures shall be made readily 
accessible to all affected employees and family members.
    (d) Violations of restrictions or requirements established by a 
chief of mission in policies, rules, or procedures issued by a chief of 
mission pursuant to paragraphs (a) and (b) of this section

[[Page 449]]

shall be grounds for disciplinary actions against the employee in 
accordance with the employing agency's procedures and regulations. 
Employees shall ensure compliance by family members with policies, rules 
or procedures issued by the chief of mission.



Sec. 136.6  Contractors.

    To the extent that contractors enjoy importation or tax privileges 
in a foreign country because of their contractual relationship to the 
United States Government, contracting agencies shall include provisions 
in their contracts that require the contractors to observe the 
requirements of these regulations and all policies, rules, and 
procedures issued by the chief of mission in that foreign country.



PART 137--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)--Table of Contents




                           Subpart A--General

Sec.
137.100  Purpose.
137.105  Definitions.
137.110  Coverage.
137.115  Policy.

                       Subpart B--Effect of Action

137.200  Debarment or suspension.
137.205  Ineligible persons.
137.210  Voluntary exclusion.
137.215  Exception provision.
137.220  Continuation of covered transactions.
137.225  Failure to adhere to restrictions.

                          Subpart C--Debarment

137.300  General.
137.305  Causes for debarment.
137.310  Procedures.
137.311  Investigation and referral.
137.312  Notice of proposed debarment.
137.313  Opportunity to contest proposed debarment.
137.314  Debarring official's decision.
137.315  Settlement and voluntary exclusion.
137.320  Period of debarment.
137.325  Scope of debarment.

                          Subpart D--Suspension

137.400  General.
137.405  Causes for suspension.
137.410  Procedures.
137.411  Notice of suspension.
137.412  Opportunity to contest suspension.
137.413  Suspending official's decision.
137.415  Period of suspension.
137.420  Scope of suspension.

       Subpart E--Responsibilities of GSA, Agency and Participants

137.500  GSA responsibilities.
137.505  Department responsibilities.
137.510  Participants' responsibilities.

          Subpart F--Drug-Free Workplace Requirements (Grants)

137.600  Purpose.
137.605  Definitions.
137.610  Coverage.
137.615  Grounds for suspension of payments, suspension or termination 
          of grants, or suspension or debarment.
137.620  Effect of violation.
137.625  Exception provision.
137.630  Certification requirements and procedures.
137.635  Reporting of and employee sanctions for convictions of criminal 
          drug offenses.

Appendix A to Part 137--Certification Regarding Debarment, Suspension, 
          and Other Responsibility Matters--Primary Covered Transactions
Appendix B to Part 137--Certification Regarding Debarment, Suspension, 
          Ineligibility and Voluntary Exclusion--Lower Tier Covered 
          Transactions
Appendix C to Part 137--Certification Regarding Drug-Free Workplace 
          Requirements

    Authority:  E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); 22 U.S.C. 2658.

    Source:  53 FR 19178 and 19204, May 26, 1988, unless otherwise 
noted.

    Cross Reference: See also Office of Management and Budget notices 
published at 55 FR 21679, May 25, 1990 and 60 FR 33036, June 26, 1995.



                           Subpart A--General



Sec. 137.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded

[[Page 450]]

from Federal financial and nonfinancial assistance and benefits under 
Federal programs and activities. Debarment or suspension of a 
participant in a program by one agency shall have governmentwide effect.
    (b) These regulations implement section 3 of E.O. 12549 and the 
guidelines promulgated by the Office of Management and Budget under 
section 6 of the E.O. by:
    (1) Prescribing the programs and activities that are covered by the 
governmentwide system;
    (2) Prescribing the governmentwide criteria and governmentwide 
minimum due process procedures that each agency shall use;
    (3) Providing for the listing of debarred and suspended 
participants, participants declared ineligible (see definition of 
``ineligible'' in Sec. 137.105), and participants who have voluntarily 
excluded themselves from participation in covered transactions;
    (4) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion; and
    (5) Offering such other guidance as necessary for the effective 
implementation and administration of the governmentwide system.
    (c) These regulations also implement Executive Order 12689 (3 CFR, 
1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 
2455, 108 Stat. 3327) by--
    (1) Providing for the inclusion in the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs all persons proposed for 
debarment, debarred or suspended under the Federal Acquisition 
Regulation, 48 CFR Part 9, subpart 9.4; persons against which 
governmentwide exclusions have been entered under this part; and persons 
determined to be ineligible; and
    (2) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion.
    (d) Although these regulations cover the listing of ineligible 
participants and the effect of such listing, they do not prescribe 
policies and procedures governing declarations of ineligibility.
[60 FR 33040, 33045, June 26, 1995]



Sec. 137.105  Definitions.

    The following definitions apply to this part:
    Adequate evidence. Information sufficient to support the reasonable 
belief that a particular act or omission has occurred.
    Affiliate. Persons are affiliates of each other if, directly or 
indirectly, either one controls or has the power to control the other, 
or, a third person controls or has the power to control both. Indicia of 
control include, but are not limited to: interlocking management or 
ownership, identity of interests among family members, shared facilities 
and equipment, common use of employees, or a business entity organized 
following the suspension or debarment of a person which has the same or 
similar management, ownership, or principal employees as the suspended, 
debarred, ineligible, or voluntarily excluded person.
    Agency. Any executive department, military department or defense 
agency or other agency of the executive branch, excluding the 
independent regulatory agencies.
    Civil judgment. The disposition of a civil action by any court of 
competent jurisdiction, whether entered by verdict, decision, 
settlement, stipulation, or otherwise creating a civil liability for the 
wrongful acts complained of; or a final determination of liability under 
the Program Fraud Civil Remedies Act of 1988 (31 U.S.C. 3801-12).
    Conviction. A judgment or conviction of a criminal offense by any 
court of competent jurisdiction, whether entered upon a verdict or a 
plea, including a plea of nolo contendere.
    Debarment. An action taken by a debarring official in accordance 
with these regulations to exclude a person from participating in covered 
transactions. A person so excluded is ``debarred.''
    Debarring official. An official authorized to impose debarment. The 
debarring official is either:
    (1) The agency head, or
    (2) An official designated by the agency head.
    Department. Department of State.
    Indictment. Indictment for a criminal offense. An information or 
other filing by competent authority charging a

[[Page 451]]

criminal offense shall be given the same effect as an indictment.
    Ineligible. Excluded from participation in Federal nonprocurement 
programs pursuant to a determination of ineligibility under statutory, 
executive order, or regulatory authority, other than Executive Order 
12549 and its agency implementing regulations; for exemple, excluded 
pursuant to the Davis-Bacon Act and its implementing regulations, the 
equal employment opportunity acts and executive orders, or the 
environmental protection acts and executive orders. A person is 
ineligible where the determination of ineligibility affects such 
person's eligibility to participate in more than one covered 
transaction.
    Legal proceedings. Any criminal proceeding or any civil judicial 
proceeding to which the Federal Government or a State or local 
government or quasi-governmental authority is a party. The term includes 
appeals from such proceedings.
    List of Parties Excluded from Federal Procurement and Nonprocurement 
Programs. A list compiled, maintained and distributed by the General 
Services Administration (GSA) containing the names and other information 
about persons who have been debarred, suspended, or voluntarily excluded 
under Executive Orders 12549 and 12689 and these regulations or 48 CFR 
part 9, subpart 9.4, persons who have been proposed for debarment under 
48 CFR part 9, subpart 9.4, and those persons who have been determined 
to be ineligible.
    Notice. A written communication served in person or sent by 
certified mail, return receipt requested, or its equivalent, to the last 
known address of a party, its identified counsel, its agent for service 
of process, or any partner, officer, director, owner, or joint venturer 
of the party. Notice, if undeliverable, shall be considered to have been 
received by the addressee five days after being properly sent to the 
last address known by the agency.
    Participant. Any person who submits a proposal for, enters into, or 
reasonably may be expected to enter into a covered transaction. This 
term also includes any person who acts on behalf of or is authorized to 
commit a participant in a covered transaction as an agent or 
representative of another participant.
    Person. Any individual, corporation, partnership, association, unit 
of government or legal entity, however organized, except: foreign 
governments or foreign governmental entities, public international 
organizations, foreign government owned (in whole or in part) or 
controlled entities, and entities consisting wholly or partially of 
foreign governments or foreign governmental entities.
    Preponderance of the evidence. Proof by information that, compared 
with that opposing it, leads to the conclusion that the fact at issue is 
more probably true than not.
    Principal. Officer, director, owner, partner, key employee, or other 
person within a participant with primary management or supervisory 
responsibilities; or a person who has a critical influence on or 
substantive control over a covered transaction, whether or not employed 
by the participant. Persons who have a critical influence on or 
substantive control over a covered transaction are:
    (1) Principal investigators.
    (2) [Reserved]
    Proposal. A solicited or unsolicited bid, application, request, 
invitation to consider or similar communication by or on behalf of a 
person seeking to participate or to receive a benefit, directly or 
indirectly, in or under a covered transaction.
    Respondent. A person against whom a debarment or suspension action 
has been initiated.
    State. Any of the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, any territory or possession 
of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers that instrumentality to be an agency of the 
State government.
    Suspending official. An official authorized to impose suspension. 
The suspending official is either:
    (1) The agency head, or

[[Page 452]]

    (2) An official designated by the agency head.
    Suspension. An action taken by a suspending official in accordance 
with these regulations that immediately excludes a person from 
participating in covered transactions for a temporary period, pending 
completion of an investigation and such legal, debarment, or Program 
Fraud Civil Remedies Act proceedings as may ensue. A person so excluded 
is ``suspended.''
    Voluntary exclusion or voluntarily excluded. A status of 
nonparticipation or limited participation in covered transactions 
assumed by a person pursuant to the terms of a settlement.
[53 FR 19178, May 26, 1988, as amended at 60 FR 33041, 33045, June 26, 
1995]



Sec. 137.110  Coverage.

    (a) These regulations apply to all persons who have participated, 
are currently participating or may reasonably be expected to participate 
in transactions under Federal nonprocurement programs. For purposes of 
these regulations such transactions will be referred to as ``covered 
transactions.''
    (1) Covered transaction. For purposes of these regulations, a 
covered transaction is a primary covered transaction or a lower tier 
covered transaction. Covered transactions at any tier need not involve 
the transfer of Federal funds.
    (i) Primary covered transaction. Except as noted in paragraph (a)(2) 
of this section, a primary covered transaction is any nonprocurement 
transaction between an agency and a person, regardless of type, 
including: grants, cooperative agreements, scholarships, fellowships, 
contracts of assistance, loans, loan guarantees, subsidies, insurance, 
payments for specified use, donation agreements and any other 
nonprocurement transactions between a Federal agency and a person. 
Primary covered transactions also include those transactions specially 
designated by the U.S. Department of Housing and Urban Development in 
such agency's regulations governing debarment and suspension.
    (ii) Lower tier covered transaction. A lower tier covered 
transaction is:
    (A) Any transaction between a participant and a person other than a 
procurement contract for goods or services, regardless of type, under a 
primary covered transaction.
    (B) Any procurement contract for goods or services between a 
participant and a person, regardless of type, expected to equal or 
exceed the Federal procurement small purchase threshold fixed at 10 
U.S.C. 2304(g) and 41 U.S.C. 253(g) (currently $25,000) under a primary 
covered transaction.
    (C) Any procurement contract for goods or services between a 
participant and a person under a covered transaction, regardless of 
amount, under which that person will have a critical influence on or 
substantive control over that covered transaction. Such persons are:
    (1) Principal investigators.
    (2) Providers of federally-required audit services.
    (2) Exceptions. The following transactions are not covered:
    (i) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (ii) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, entities 
consisting wholly or partially of foreign governments or foreign 
governmental entities;
    (iii) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (iv) Federal employment;
    (v) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (vi) Incidental benefits derived from ordinary governmental 
operations; and
    (vii) Other transactions where the application of these regulations 
would be prohibited by law.
    (b) Relationship to other sections. This section describes the types 
of transactions to which a debarment or suspension under the regulations 
will apply. Subpart B, ``Effect of Action,'' Sec. 137.200, ``Debarment 
or suspension,''

[[Page 453]]

sets forth the consequences of a debarment or suspension. Those 
consequences would obtain only with respect to participants and 
principals in the covered transactions and activities described in 
Sec. 137.110(a). Sections 137.325, ``Scope of debarment,'' and 137.420, 
``Scope of suspension,'' govern the extent to which a specific 
participant or organizational elements of a participant would be 
automatically included within a debarment or suspension action, and the 
conditions under which affiliates or persons associated with a 
participant may also be brought within the scope of the action.
    (c) Relationship to Federal procurement activities. In accordance 
with E.O. 12689 and section 2455 of Public Law 103-355, any debarment, 
suspension, proposed debarment or other governmentwide exclusion 
initiated under the Federal Acquisition Regulation (FAR) on or after 
August 25, 1995 shall be recognized by and effective for Executive 
Branch agencies and participants as an exclusion under this regulation. 
Similarly, any debarment, suspension or other governmentwide exclusion 
initiated under this regulation on or after August 25, 1995 shall be 
recognized by and effective for those agencies as a debarment or 
suspension under the FAR.
[53 FR 19178 and 19204, May 26, 1988, as amended at 60 FR 33041, 33045, 
June 26, 1995]



Sec. 137.115  Policy.

    (a) In order to protect the public interest, it is the policy of the 
Federal Government to conduct business only with responsible persons. 
Debarment and suspension are discretionary actions that, taken in 
accordance with Executive Order 12549 and these regulations, are 
appropriate means to implement this policy.
    (b) Debarment and suspension are serious actions which shall be used 
only in the public interest and for the Federal Government's protection 
and not for purposes of punishment. Agencies may impose debarment or 
suspension for the causes and in accordance with the procedures set 
forth in these regulations.
    (c) When more than one agency has an interest in the proposed 
debarment or suspension of a person, consideration shall be given to 
designating one agency as the lead agency for making the decision. 
Agencies are encouraged to establish methods and procedures for 
coordinating their debarment or suspension actions.



                       Subpart B--Effect of Action



Sec. 137.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited by 
law, persons who are debarred or suspended shall be excluded from 
primary covered transactions as either participants or principals 
throughout the Executive Branch of the Federal Government for the period 
of their debarment, suspension, or the period they are proposed for 
debarment under 48 CFR part 9, subpart 9.4. Accordingly, no agency shall 
enter into primary covered transactions with such excluded persons 
during such period, except as permitted pursuant to Sec. 137.215.
    (b) Lower tier covered transactions. Except to the extent prohibited 
by law, persons who have been proposed for debarment under 48 CFR part 
9, subpart 9.4, debarred or suspended shall be excluded from 
participating as either participants or principals in all lower tier 
covered transactions (see Sec. 137.110(a)(1)(ii)) for the period of 
their exclusion.
    (c) Exceptions. Debarment or suspension does not affect a person's 
eligibility for--
    (1) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (2) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, and 
entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (3) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (4) Federal employment;

[[Page 454]]

    (5) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (6) Incidental benefits derived from ordinary governmental 
operations; and
    (7) Other transactions where the application of these regulations 
would be prohibited by law.
[60 FR 33041, 33045, June 26, 1995]



Sec. 137.205  Ineligible persons.

    Persons who are ineligible, as defined in Sec. 137.105(i), are 
excluded in accordance with the applicable statutory, executive order, 
or regulatory authority.



Sec. 137.210  Voluntary exclusion.

    Persons who accept voluntary exclusions under Sec. 137.315 are 
excluded in accordance with the terms of their settlements. Department 
shall, and participants may, contact the original action agency to 
ascertain the extent of the exclusion.



Sec. 137.215  Exception provision.

    The International Development Cooperation Agency may grant an 
exception permitting a debarred, suspended, or voluntarily excluded 
person, or a person proposed for debarment under 48 CFR part 9, subpart 
9.4, to participate in a particular covered transaction upon a written 
determination by the agency head or an authorized designee stating the 
reason(s) for deviating from the Presidential policy established by 
Executive Order 12549 and Sec. 137.200. However, in accordance with the 
President's stated intention in the Executive Order, exceptions shall be 
granted only infrequently. Exceptions shall be reported in accordance 
with Sec. 137.505(a).
[60 FR 33041, 33045, June 26, 1995]



Sec. 137.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency, agencies and 
participants may continue covered transactions in existence at the time 
the person was debarred, suspended, proposed for debarment under 48 CFR 
part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A 
decision as to the type of termination action, if any, to be taken 
should be made only after thorough review to ensure the propriety of the 
proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who is 
debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 
9.4, ineligible or voluntary excluded, except as provided in 
Sec. 137.215.
[60 FR 33041, 33045, June 26, 1995]



Sec. 137.225  Failure to adhere to restrictions.

    (a) Except as permitted under Sec. 137.215 or Sec. 137.220, a 
participant shall not knowingly do business under a covered transaction 
with a person who is--
    (1) Debarred or suspended;
    (2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
    (3) Ineligible for or voluntarily excluded from the covered 
transaction.
    (b) Violation of the restriction under paragraph (a) of this section 
may result in disallowance of costs, annulment or termination of award, 
issuance of a stop work order, debarment or suspension, or other 
remedies as appropriate.
    (c) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, proposed for debarment under 48 
CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the 
covered transaction (See appendix B of these regulations), unless it 
knows that the certification is erroneous. An agency has the burden of 
proof that a participant did knowingly do business with a person that 
filed an erroneous certification.
[60 FR 33041, 33045, June 26, 1995]



                          Subpart C--Debarment



Sec. 137.300  General.

    The debarring official may debar a person for any of the causes in 
Sec. 137.305, using procedures established in Secs. 137.310 through 
137.314. The existence of a cause for debarment, however, does not 
necessarily require that the person

[[Page 455]]

be debarred; the seriousness of the person's acts or omissions and any 
mitigating factors shall be considered in making any debarment decision.



Sec. 137.305  Causes for debarment.

    Debarment may be imposed in accordance with the provisions of 
Secs. 137.300 through 137.314 for:
    (a) Conviction of or civil judgment for:
    (1) Commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public or private 
agreement or transaction;
    (2) Violation of Federal or State antitrust statutes, including 
those proscribing price fixing between competitors, allocation of 
customers between competitors, and bid rigging;
    (3) Commission of embezzlement, theft, forgery, bribery, 
falsification or destruction of records, making false statements, 
receiving stolen property, making false claims, or obstruction of 
justice; or
    (4) Commission of any other offense indicating a lack of business 
integrity or business honesty that seriously and directly affects the 
present responsibility of a person.
    (b) Violation of the terms of a public agreement or transaction so 
serious as to affect the integrity of an agency program, such as:
    (1) A willful failure to perform in accordance with the terms of one 
or more public agreements or transactions;
    (2) A history of failure to perform or of unsatisfactory performance 
of one or more public agreements or transactions; or
    (3) A willful violation of a statutory or regulatory provision or 
requirement applicable to a public agreement or transaction.
    (c) Any of the following causes:
    (1) A nonprocurement debarment by any Federal agency taken before 
October 1, 1988, the effective date of these regulations, or a 
procurement debarment by any Federal agency taken pursuant to 48 CFR 
subpart 9.4;
    (2) Knowingly doing business with a debarred, suspended, ineligible, 
or voluntarily excluded person, in connection with a covered 
transaction, except as permitted in Sec. 137.215 or Sec. 137.220;
    (3) Failure to pay a single substantial debt, or a number of 
outstanding debts (including disallowed costs and overpayments, but not 
including sums owed the Federal Government under the Internal Revenue 
Code) owed to any Federal agency or instrumentality, provided the debt 
is uncontested by the debtor or, if contested, provided that the 
debtor's legal and administrative remedies have been exhausted;
    (4) Violation of a material provision of a voluntary exclusion 
agreement entered into under Sec. 137.315 or of any settlement of a 
debarment or suspension action; or
    (5) Violation of any requirement of subpart F of this part, relating 
to providing a drug-free workplace, as set forth in Sec. 137.615 of this 
part.
    (d) Any other cause of so serious or compelling a nature that it 
affects the present responsibility of a person.
[53 FR 19178 and 19204, May 26, 1988, as amended at 54 FR 4954, Jan. 31, 
1989]



Sec. 137.310  Procedures.

    Department shall process debarment actions as informally as 
practicable, consistent with the principles of fundamental fairness, 
using the procedures in Secs. 137.311 through 137.314.



Sec. 137.311  Investigation and referral.

    Information concerning the existence of a cause for debarment from 
any source shall be promptly reported, investigated, and referred, when 
appropriate, to the debarring official for consideration. After 
consideration, the debarring official may issue a notice of proposed 
debarment.



Sec. 137.312  Notice of proposed debarment.

    A debarment proceeding shall be initiated by notice to the 
respondent advising:
    (a) That debarment is being considered;
    (b) Of the reasons for the proposed debarment in terms sufficient to 
put the respondent on notice of the conduct or transaction(s) upon which 
it is based;
    (c) Of the cause(s) relied upon under Sec. 137.305 for proposing 
debarment;

[[Page 456]]

    (d) Of the provisions of Secs. 137.311 through 137.314, and any 
other Department procedures, if applicable, governing debarment 
decisionmaking; and
    (e) Of the potential effect of a debarment.



Sec. 137.313  Opportunity to contest proposed debarment.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of proposed debarment, the respondent may submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment.
    (b) Additional proceedings as to disputed material facts. (1) In 
actions not based upon a conviction or civil judgment, if the debarring 
official finds that the respondent's submission in opposition raises a 
genuine dispute over facts material to the proposed debarment, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents.
    (2) A transcribed record of any additional proceedings shall be made 
available at cost to the respondent, upon request, unless the respondent 
and the agency, by mutual agreement, waive the requirement for a 
transcript.



Sec. 137.314  Debarring official's decision.

    (a) No additional proceedings necessary. In actions based upon a 
conviction or civil judgment, or in which there is no genuine dispute 
over material facts, the debarring official shall make a decision on the 
basis of all the information in the administrative record, including any 
submission made by the respondent. The decision shall be made within 45 
days after receipt of any information and argument submitted by the 
respondent, unless the debarring official extends this period for good 
cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The debarring 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The debarring official may refer disputed material facts to 
another official for findings of fact. The debarring official may reject 
any such findings, in whole or in part, only after specifically 
determining them to be arbitrary and capricious or clearly erroneous.
    (3) The debarring official's decision shall be made after the 
conclusion of the proceedings with respect to disputed facts.
    (c) (1) Standard of proof. In any debarment action, the cause for 
debarment must be established by a preponderance of the evidence. Where 
the proposed debarment is based upon a conviction or civil judgment, the 
standard shall be deemed to have been met.
    (2) Burden of proof. The burden of proof is on the agency proposing 
debarment.
    (d) Notice of debarring official's decision. (1) If the debarring 
official decides to impose debarment, the respondent shall be given 
prompt notice:
    (i) Referring to the notice of proposed debarment;
    (ii) Specifying the reasons for debarment;
    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the Federal Government 
unless an agency head or an authorized designee makes the determination 
referred to in Sec. 137.215.
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision not 
to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.



Sec. 137.315  Settlement and voluntary exclusion.

    (a) When in the best interest of the Government, Department may, at 
any time, settle a debarment or suspension action.
    (b) If a participant and the agency agree to a voluntary exclusion 
of the participant, such voluntary exclusion shall be entered on the 
Nonprocurement List (see subpart E).

[[Page 457]]



Sec. 137.320  Period of debarment.

    (a) Debarment shall be for a period commensurate with the 
seriousness of the cause(s). If a suspension precedes a debarment, the 
suspension period shall be considered in determining the debarment 
period.
    (1) Debarment for causes other than those related to a violation of 
the requirements of subpart F of this part generally should not exceed 
three years. Where circumstances warrant, a longer period of debarment 
may be imposed.
    (2) In the case of a debarment for a violation of the requirements 
of subpart F of this part (seeSec. 137.305(c)(5)), the period of 
debarment shall not exceed five years.
    (b) The debarring official may extend an existing debarment for an 
additional period, if that official determines that an extension is 
necessary to protect the public interest. However, a debarment may not 
be extended solely on the basis of the facts and circumstances upon 
which the initial debarment action was based. If debarment for an 
additional period is determined to be necessary, the procedures of 
Secs. 137.311 through 137.314 shall be followed to extend the debarment.
    (c) The respondent may request the debarring official to reverse the 
debarment decision or to reduce the period or scope of debarment. Such a 
request shall be in writing and supported by documentation. The 
debarring official may grant such a request for reasons including, but 
not limited to:
    (1) Newly discovered material evidence;
    (2) Reversal of the conviction or civil judgment upon which the 
debarment was based;
    (3) Bona fide change in ownership or management;
    (4) Elimination of other causes for which the debarment was imposed; 
or
    (5) Other reasons the debarring official deems appropriate.
[53 FR 19178 and 19204, May 26, 1988, as amended at 54 FR 4954, Jan. 31, 
1989]



Sec. 137.325  Scope of debarment.

    (a) Scope in general. (1) Debarment of a person under these 
regulations constitutes debarment of all its divisions and other 
organizational elements from all covered transactions, unless the 
debarment decision is limited by its terms to one or more specifically 
identified individuals, divisions or other organizational elements or to 
specific types of transactions.
    (2) The debarment action may include any affiliate of the 
participant that is specifically named and given notice of the proposed 
debarment and an opportunity to respond (see Secs. 137.311 through 
137.314).
    (b) Imputing conduct. For purposes of determining the scope of 
debarment, conduct may be imputed as follows:
    (1) Conduct imputed to participant. The fraudulent, criminal or 
other seriously improper conduct of any officer, director, shareholder, 
partner, employee, or other individual associated with a participant may 
be imputed to the participant when the conduct occurred in connection 
with the individual's performance of duties for or on behalf of the 
participant, or with the participant's knowledge, approval, or 
acquiescence. The participant's acceptance of the benefits derived from 
the conduct shall be evidence of such knowledge, approval, or 
acquiescence.
    (2) Conduct imputed to individuals associated with participant. The 
fraudulent, criminal, or other seriously improper conduct of a 
participant may be imputed to any officer, director, shareholder, 
partner, employee, or other individual associated with the participant 
who participated in, knew of, or had reason to know of the participant's 
conduct.
    (3) Conduct of one participant imputed to other participants in a 
joint venture. The fraudulent, criminal, or other seriously improper 
conduct of one participant in a joint venture, grant pursuant to a joint 
application, or similar arrangement may be imputed to other participants 
if the conduct occurred for or on behalf of the joint venture, grant 
pursuant to a joint application, or similar arrangement may be imputed 
to other participants if the conduct occurred for or on behalf of the 
joint venture, grant pursuant to a joint application, or similar 
arrangement or with the knowledge, approval, or acquiescence of these 
participants. Acceptance

[[Page 458]]

of the benefits derived from the conduct shall be evidence of such 
knowledge, approval, or acquiescence.



                          Subpart D--Suspension



Sec. 137.400  General.

    (a) The suspending official may suspend a person for any of the 
causes in Sec. 137.405 using procedures established in Secs. 137.410 
through 137.413.
    (b) Suspension is a serious action to be imposed only when:
    (1) There exists adequate evidence of one or more of the causes set 
out in Sec. 137.405, and
    (2) Immediate action is necessary to protect the public interest.
    (c) In assessing the adequacy of the evidence, the agency should 
consider how much information is available, how credible it is given the 
circumstances, whether or not important allegations are corroborated, 
and what inferences can reasonably be drawn as a result. This assessment 
should include an examination of basic documents such as grants, 
cooperative agreements, loan authorizations, and contracts.



Sec. 137.405.  Causes for suspension.

    (a) Suspension may be imposed in accordance with the provisions of 
Secs. 137.400 through 137.413 upon adequate evidence:
    (1) To suspect the commission of an offense listed in 
Sec. 137.305(a); or
    (2) That a cause for debarment under Sec. 137.305 may exist.
    (b) Indictment shall constitute adequate evidence for purposes of 
suspension actions.



Sec. 137.410  Procedures.

    (a) Investigation and referral. Information concerning the existence 
of a cause for suspension from any source shall be promptly reported, 
investigated, and referred, when appropriate, to the suspending official 
for consideration. After consideration, the suspending official may 
issue a notice of suspension.
    (b) Decisionmaking process. Department shall process suspension 
actions as informally as practicable, consistent with principles of 
fundamental fairness, using the procedures in Secs. 137.411 through 
137.413.



Sec. 137.411  Notice of suspension.

    When a respondent is suspended, notice shall immediately be given:
    (a) That suspension has been imposed;
    (b) That the suspension is based on an indictment, conviction, or 
other adequate evidence that the respondent has committed irregularities 
seriously reflecting on the propriety of further Federal Government 
dealings with the respondent;
    (c) Describing any such irregularities in terms sufficient to put 
the respondent on notice without disclosing the Federal Government's 
evidence;
    (d) Of the cause(s) relied upon under Sec. 137.405 for imposing 
suspension;
    (e) That the suspension is for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings;
    (f) Of the provisions of Secs. 137.411 through 137.413 and any other 
Department procedures, if applicable, governing suspension 
decisionmaking; and
    (g) Of the effect of the suspension.



Sec. 137.412  Opportunity to contest suspension.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of suspension, the respondent may submit, in person, in writing, 
or through a representative, information and argument in opposition to 
the suspension.
    (b) Additional proceedings as to disputed material facts. (1) If the 
suspending official finds that the respondent's submission in opposition 
raises a genuine dispute over facts material to the suspension, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents, unless:
    (i) The action is based on an indictment, conviction or civil 
judgment, or
    (ii) A determination is made, on the basis of Department of Justice 
advice, that the substantial interests of the Federal Government in 
pending or contemplated legal proceedings based on

[[Page 459]]

the same facts as the suspension would be prejudiced.
    (2) A transcribed record of any additional proceedings shall be 
prepared and made available at cost to the respondent, upon request, 
unless the respondent and the agency, by mutual agreement, waive the 
requirement for a transcript.



Sec. 137.413  Suspending official's decision.

    The suspending official may modify or terminate the suspension (for 
example, see Sec. 137.320(c) for reasons for reducing the period or 
scope of debarment) or may leave it in force. However, a decision to 
modify or terminate the suspension shall be without prejudice to the 
subsequent imposition of suspension by any other agency or debarment by 
any agency. The decision shall be rendered in accordance with the 
following provisions:
    (a) No additional proceedings necessary. In actions: based on an 
indictment, conviction, or civil judgment; in which there is no genuine 
dispute over material facts; or in which additional proceedings to 
determine disputed material facts have been denied on the basis of 
Department of Justice advice, the suspending official shall make a 
decision on the basis of all the information in the administrative 
record, including any submission made by the respondent. The decision 
shall be made within 45 days after receipt of any information and 
argument submitted by the respondent, unless the suspending official 
extends this period for good cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The suspending 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The suspending official may refer matters involving disputed 
material facts to another official for findings of fact. The suspending 
official may reject any such findings, in whole or in part, only after 
specifically determining them to be arbitrary or capricious or clearly 
erroneous.
    (c) Notice of suspending official's decision. Prompt written notice 
of the suspending official's decision shall be sent to the respondent.



Sec. 137.415  Period of suspension.

    (a) Suspension shall be for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings, unless terminated sooner by the 
suspending official or as provided in paragraph (b) of this section.
    (b) If legal or administrative proceedings are not initiated within 
12 months after the date of the suspension notice, the suspension shall 
be terminated unless an Assistant Attorney General or United States 
Attorney requests its extension in writing, in which case it may be 
extended for an additional six months. In no event may a suspension 
extend beyond 18 months, unless such proceedings have been initiated 
within that period.
    (c) The suspending official shall notify the Department of Justice 
of an impending termination of a suspension, at least 30 days before the 
12-month period expires, to give that Department an opportunity to 
request an extension.



Sec. 137.420  Scope of suspension.

    The scope of a suspension is the same as the scope of a debarment 
(see Sec. 137.325), except that the procedures of Secs. 137.410 through 
137.413 shall be used in imposing a suspension.



       Subpart E--Responsibilities of GSA, Agency and Participants



Sec. 137.500  GSA responsibilities.

    (a) In accordance with the OMB guidelines, GSA shall compile, 
maintain, and distribute a list of all persons who have been debarred, 
suspended, or voluntarily excluded by agencies under Executive Order 
12549 and these regulations, and those who have been determined to be 
ineligible.
    (b) At a minimum, this list shall indicate:
    (1) The names and addresses of all debarred, suspended, ineligible, 
and voluntarily excluded persons, in alphabetical order, with cross-
references

[[Page 460]]

when more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for each listing; and
    (6) The agency and name and telephone number of the agency point of 
contact for the action.



Sec. 137.505  Department responsibilities.

    (a) The agency shall provide GSA with current information concerning 
debarments, suspension, determinations of ineligibility, and voluntary 
exclusions it has taken. Until February 18, 1989, the agency shall also 
provide GSA and OMB with information concerning all transactions in 
which Department has granted exceptions under Sec. 137.215 permitting 
participation by debarred, suspended, or voluntarily excluded persons.
    (b) Unless an alternative schedule is agreed to by GSA, the agency 
shall advise GSA of the information set forth in Sec. 137.500(b) and of 
the exceptions granted under Sec. 137.215 within five working days after 
taking such actions.
    (c) The agency shall direct inquiries concerning listed persons to 
the agency that took the action.
    (d) Agency officials shall check the Nonprocurement List before 
entering covered transactions to determine whether a participant in a 
primary transaction is debarred, suspended, ineligible, or voluntarily 
excluded (Tel. ).
    (e) Agency officials shall check the Nonprocurement List before 
approving principals or lower tier participants where agency approval of 
the principal or lower tier participant is required under the terms of 
the transaction, to determine whether such principals or participants 
are debarred, suspended, ineligible, or voluntarily excluded.



Sec. 137.510  Participants' responsibilities.

    (a) Certification by participants in primary covered transactions. 
Each participant shall submit the certification in appendix A to this 
part for it and its principals at the time the participant submits its 
proposal in connection with a primary covered transaction, except that 
States need only complete such certification as to their principals. 
Participants may decide the method and frequency by which they determine 
the eligibility of their principals. In addition, each participant may, 
but is not required to, check the Nonprocurement List for its principals 
(Tel. ). Adverse information on the certification will not necessarily 
result in denial of participation. However, the certification, and any 
additional information pertaining to the certification submitted by the 
participant, shall be considered in the administration of covered 
transactions.
    (b) Certification by participants in lower tier covered 
transactions. (1) Each participant shall require participants in lower 
tier covered transactions to include the certification in appendix B to 
this part for it and its principals in any proposal submitted in 
connection with such lower tier covered transactions.
    (2) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, ineligible, or voluntarily 
excluded from the covered transaction by any Federal agency, unless it 
knows that the certification is erroneous. Participants may decide the 
method and frequency by which they determine the eligiblity of their 
principals. In addition, a participant may, but is not required to, 
check the Nonprocurement List for its principals and for participants 
(Tel. ).
    (c) Changed circumstances regarding certification. A participant 
shall provide immediate written notice to Department if at any time the 
participant learns that its certification was erroneous when submitted 
or has become erroneous by reason of changed circumstances. Participants 
in lower tier covered transactions shall provide the same updated notice 
to the participant to which it submitted its proposals.



          Subpart F--Drug-Free Workplace Requirements (Grants)

    Source:  55 FR 21688, 21693, May 25, 1990, unless otherwise noted.

[[Page 461]]



Sec. 137.600  Purpose.

    (a) The purpose of this subpart is to carry out the Drug-Free 
Workplace Act of 1988 by requiring that--
    (1) A grantee, other than an individual, shall certify to the agency 
that it will provide a drug-free workplace;
    (2) A grantee who is an individual shall certify to the agency that, 
as a condition of the grant, he or she will not engage in the unlawful 
manufacture, distribution, dispensing, possession or use of a controlled 
substance in conducting any activity with the grant.
    (b) Requirements implementing the Drug-Free Workplace Act of 1988 
for contractors with the agency are found at 48 CFR subparts 9.4, 23.5, 
and 52.2.



Sec. 137.605  Definitions.

    (a) Except as amended in this section, the definitions of 
Sec. 137.105 apply to this subpart.
    (b) For purposes of this subpart--
    (1) Controlled substance means a controlled substance in schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812), and as 
further defined by regulation at 21 CFR 1308.11 through 1308.15;
    (2) Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    (3) Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    (4) Drug-free workplace means a site for the performance of work 
done in connection with a specific grant at which employees of the 
grantee are prohibited from engaging in the unlawful manufacture, 
distribution, dispensing, possession, or use of a controlled substance;
    (5) Employee means the employee of a grantee directly engaged in the 
performance of work under the grant, including:
    (i) All direct charge employees;
    (ii) All indirect charge employees, unless their impact or 
involvement is insignificant to the performance of the grant; and,
    (iii) Temporary personnel and consultants who are directly engaged 
in the performance of work under the grant and who are on the grantee's 
payroll.

This definition does not include workers not on the payroll of the 
grantee (e.g., volunteers, even if used to meet a matching requirement; 
consultants or independent contractors not on the payroll; or employees 
of subrecipients or subcontractors in covered workplaces);
    (6) Federal agency or agency means any United States executive 
department, military department, government corporation, government 
controlled corporation, any other establishment in the executive branch 
(including the Executive Office of the President), or any independent 
regulatory agency;
    (7) Grant means an award of financial assistance, including a 
cooperative agreement, in the form of money, or property in lieu of 
money, by a Federal agency directly to a grantee. The term grant 
includes block grant and entitlement grant programs, whether or not 
exempted from coverage under the grants management government-wide 
common rule on uniform administrative requirements for grants and 
cooperative agreements. The term does not include technical assistance 
that provides services instead of money, or other assistance in the form 
of loans, loan guarantees, interest subsidies, insurance, or direct 
appropriations; or any veterans' benefits to individuals, i.e., any 
benefit to veterans, their families, or survivors by virtue of the 
service of a veteran in the Armed Forces of the United States;
    (8) Grantee means a person who applies for or receives a grant 
directly from a Federal agency (except another Federal agency);
    (9) Individual means a natural person;
    (10) State means any of the States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of

[[Page 462]]

local government. A State instrumentality will be considered part of the 
State government if it has a written determination from a State 
government that such State considers the instrumentality to be an agency 
of the State government.



Sec. 137.610  Coverage.

    (a) This subpart applies to any grantee of the agency.
    (b) This subpart applies to any grant, except where application of 
this subpart would be inconsistent with the international obligations of 
the United States or the laws or regulations of a foreign government. A 
determination of such inconsistency may be made only by the agency head 
or his/her designee.
    (c) The provisions of subparts A, B, C, D and E of this part apply 
to matters covered by this subpart, except where specifically modified 
by this subpart. In the event of any conflict between provisions of this 
subpart and other provisions of this part, the provisions of this 
subpart are deemed to control with respect to the implementation of 
drug-free workplace requirements concerning grants.



Sec. 137.615  Grounds for suspension of payments, suspension or termination of grants, or suspension or debarment.

    A grantee shall be deemed in violation of the requirements of this 
subpart if the agency head or his or her official designee determines, 
in writing, that--
    (a) The grantee has made a false certification under Sec. 137.630;
    (b) With respect to a grantee other than an individual--
    (1) The grantee has violated the certification by failing to carry 
out the requirements of paragraphs (A)(a)-(g) and/or (B) of the 
certification (Alternate I to Appendix C) or
    (2) Such a number of employees of the grantee have been convicted of 
violations of criminal drug statutes for violations occurring in the 
workplace as to indicate that the grantee has failed to make a good 
faith effort to provide a drug-free workplace.
    (c) With respect to a grantee who is an individual--
    (1) The grantee has violated the certification by failing to carry 
out its requirements (Alternate II to Appendix C); or
    (2) The grantee is convicted of a criminal drug offense resulting 
from a violation occurring during the conduct of any grant activity.



Sec. 137.620  Effect of violation.

    (a) In the event of a violation of this subpart as provided in 
Sec. 137.615, and in accordance with applicable law, the grantee shall 
be subject to one or more of the following actions:
    (1) Suspension of payments under the grant;
    (2) Suspension or termination of the grant; and
    (3) Suspension or debarment of the grantee under the provisions of 
this part.
    (b) Upon issuance of any final decision under this part requiring 
debarment of a grantee, the debarred grantee shall be ineligible for 
award of any grant from any Federal agency for a period specified in the 
decision, not to exceed five years (see Sec. 137.320(a)(2) of this 
part).



Sec. 137.625  Exception provision.

    The agency head may waive with respect to a particular grant, in 
writing, a suspension of payments under a grant, suspension or 
termination of a grant, or suspension or debarment of a grantee if the 
agency head determines that such a waiver would be in the public 
interest. This exception authority cannot be delegated to any other 
official.



Sec. 137.630  Certification requirements and procedures.

    (a)(1) As a prior condition of being awarded a grant, each grantee 
shall make the appropriate certification to the Federal agency providing 
the grant, as provided in appendix C to this part.
    (2) Grantees are not required to make a certification in order to 
continue receiving funds under a grant awarded before March 18, 1989, or 
under a no-cost time extension of such a grant. However, the grantee 
shall make a one-time drug-free workplace certification for a non-
automatic continuation of

[[Page 463]]

such a grant made on or after March 18, 1989.
    (b) Except as provided in this section, all grantees shall make the 
required certification for each grant. For mandatory formula grants and 
entitlements that have no application process, grantees shall submit a 
one-time certification in order to continue receiving awards.
    (c) A grantee that is a State may elect to make one certification in 
each Federal fiscal year. States that previously submitted an annual 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. Except as provided in paragraph (d) of this 
section, this certification shall cover all grants to all State agencies 
from any Federal agency. The State shall retain the original of this 
statewide certification in its Governor's office and, prior to grant 
award, shall ensure that a copy is submitted individually with respect 
to each grant, unless the Federal agency has designated a central 
location for submission.
    (d)(1) The Governor of a State may exclude certain State agencies 
from the statewide certification and authorize these agencies to submit 
their own certifications to Federal agencies. The statewide 
certification shall name any State agencies so excluded.
    (2) A State agency to which the statewide certification does not 
apply, or a State agency in a State that does not have a statewide 
certification, may elect to make one certification in each Federal 
fiscal year. State agencies that previously submitted a State agency 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. The State agency shall retain the original of 
this State agency-wide certification in its central office and, prior to 
grant award, shall ensure that a copy is submitted individually with 
respect to each grant, unless the Federal agency designates a central 
location for submission.
    (3) When the work of a grant is done by more than one State agency, 
the certification of the State agency directly receiving the grant shall 
be deemed to certify compliance for all workplaces, including those 
located in other State agencies.
    (e)(1) For a grant of less than 30 days performance duration, 
grantees shall have this policy statement and program in place as soon 
as possible, but in any case by a date prior to the date on which 
performance is expected to be completed.
    (2) For a grant of 30 days or more performance duration, grantees 
shall have this policy statement and program in place within 30 days 
after award.
    (3) Where extraordinary circumstances warrant for a specific grant, 
the grant officer may determine a different date on which the policy 
statement and program shall be in place.



Sec. 137.635  Reporting of and employee sanctions for convictions of criminal drug offenses.

    (a) When a grantee other than an individual is notified that an 
employee has been convicted for a violation of a criminal drug statute 
occurring in the workplace, it shall take the following actions:
    (1) Within 10 calendar days of receiving notice of the conviction, 
the grantee shall provide written notice, including the convicted 
employee's position title, to every grant officer, or other designee on 
whose grant activity the convicted employee was working, unless a 
Federal agency has designated a central point for the receipt of such 
notifications. Notification shall include the identification number(s) 
for each of the Federal agency's affected grants.
    (2) Within 30 calendar days of receiving notice of the conviction, 
the grantee shall do the following with respect to the employee who was 
convicted.
    (i) Take appropriate personnel action against the employee, up to 
and including termination, consistent with requirements of the 
Rehabilitation Act of 1973, as amended; or
    (ii) Require the employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency.
    (b) A grantee who is an individual who is convicted for a violation 
of a criminal drug statute occurring during the conduct of any grant 
activity shall

[[Page 464]]

report the conviction, in writing, within 10 calendar days, to his or 
her Federal agency grant officer, or other designee, unless the Federal 
agency has designated a central point for the receipt of such notices. 
Notification shall include the identification number(s) for each of the 
Federal agency's affected grants.

(Approved by the Office of Management and Budget under control number 
0991-0002)

 Appendix A to Part 137--Certification Regarding Debarment, Suspension, 
     and Other Responsibility Matters--Primary Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective primary 
participant is providing the certification set out below.
    2. The inability of a person to provide the certification required 
below will not necessarily result in denial of participation in this 
covered transaction. The prospective participant shall submit an 
explanation of why it cannot provide the certification set out below. 
The certification or explanation will be considered in connection with 
the department or agency's determination whether to enter into this 
transaction. However, failure of the prospective primary participant to 
furnish a certification or an explanation shall disqualify such person 
from participation in this transaction.
    3. The certification in this clause is a material representation of 
fact upon which reliance was placed when the department or agency 
determined to enter into this transaction. If it is later determined 
that the prospective primary participant knowingly rendered an erroneous 
certification, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.
    4. The prospective primary participant shall provide immediate 
written notice to the department or agency to which this proposal is 
submitted if at any time the prospective primary participant learns that 
its certification was erroneous when submitted or has become erroneous 
by reason of changed circumstances.
    5. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meanings set out in the Definitions and Coverage 
sections of the rules implementing Executive Order 12549. You may 
contact the department or agency to which this proposal is being 
submitted for assistance in obtaining a copy of those regulations.
    6. The prospective primary participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency entering into this transaction.
    7. The prospective primary participant further agrees by submitting 
this proposal that it will include the clause titled ``Certification 
Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-
Lower Tier Covered Transaction,'' provided by the department or agency 
entering into this covered transaction, without modification, in all 
lower tier covered transactions and in all solicitations for lower tier 
covered transactions.
    8. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from the covered transaction, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to, check the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs.
    9. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    10. Except for transactions authorized under paragraph 6 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.

[[Page 465]]

Certification Regarding Debarment, Suspension, and Other Responsibility 
                  Matters--Primary Covered Transactions

    (1) The prospective primary participant certifies to the best of its 
knowledge and belief, that it and its principals:
    (a) Are not presently debarred, suspended, proposed for debarment, 
declared ineligible, or voluntarily excluded by any Federal department 
or agency;
    (b) Have not within a three-year period preceding this proposal been 
convicted of or had a civil judgment rendered against them for 
commission of fraud or a criminal offense in connection with obtaining, 
attempting to obtain, or performing a public (Federal, State or local) 
transaction or contract under a public transaction; violation of Federal 
or State antitrust statutes or commission of embezzlement, theft, 
forgery, bribery, falsification or destruction of records, making false 
statements, or receiving stolen property;
    (c) Are not presently indicted for or otherwise criminally or 
civilly charged by a governmental entity (Federal, State or local) with 
commission of any of the offenses enumerated in paragraph (1)(b) of this 
certification; and
    (d) Have not within a three-year period preceding this application/
proposal had one or more public transactions (Federal, State or local) 
terminated for cause or default.
    (2) Where the prospective primary participant is unable to certify 
to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.
[60 FR 33042, 33045, June 26, 1995]

 Appendix B to Part 137--Certification Regarding Debarment, Suspension, 
  Ineligibilty and Voluntary Exclusion--Lower Tier Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective lower 
tier participant is providing the certification set out below.
    2. The certification in this clause is a material representation of 
fact upon which reliance was placed when this transaction was entered 
into. If it is later determined that the prospective lower tier 
participant knowingly rendered an erroneous certification, in addition 
to other remedies available to the Federal Government the department or 
agency with which this transaction originated may pursue available 
remedies, including suspension and/or debarment.
    3. The prospective lower tier participant shall provide immediate 
written notice to the person to which this proposal is submitted if at 
any time the prospective lower tier participant learns that its 
certification was erroneous when submitted or had become erroneous by 
reason of changed circumstances.
    4. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meaning set out in the Definitions and Coverage 
sections of rules implementing Executive Order 12549. You may contact 
the person to which this proposal is submitted for assistance in 
obtaining a copy of those regulations.
    5. The prospective lower tier participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency with which this transaction originated.
    6. The prospective lower tier participant further agrees by 
submitting this proposal that it will include this clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' without 
modification, in all lower tier covered transactions and in all 
solicitations for lower tier covered transactions.
    7. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from covered transactions, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to, check the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs.
    8. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    9. Except for transactions authorized under paragraph 5 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the

[[Page 466]]

Federal Government, the department or agency with which this transaction 
originated may pursue available remedies, including suspension and/or 
debarment.

    Certification Regarding Debarment, Suspension, Ineligibility an 
          Voluntary Exclusion--Lower Tier Covered Transactions

    (1) The prospective lower tier participant certifies, by submission 
of this proposal, that neither it nor its principals is presently 
debarred, suspended, proposed for debarment, declared ineligible, or 
voluntarily excluded from participation in this transaction by any 
Federal department or agency.
    (2) Where the prospective lower tier participant is unable to 
certify to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.
[60 FR 33042, 33045, June 26, 1995]

  Appendix C to Part 137--Certification Regarding Drug-Free Workplace 
                              Requirements

                     Instructions for Certification

    1. By signing and/or submitting this application or grant agreement, 
the grantee is providing the certification set out below.
    2. The certification set out below is a material representation of 
fact upon which reliance is placed when the agency awards the grant. If 
it is later determined that the grantee knowingly rendered a false 
certification, or otherwise violates the requirements of the Drug-Free 
Workplace Act, the agency, in addition to any other remedies available 
to the Federal Government, may take action authorized under the Drug-
Free Workplace Act.
    3. For grantees other than individuals, Alternate I applies.
    4. For grantees who are individuals, Alternate II applies.
    5. Workplaces under grants, for grantees other than individuals, 
need not be identified on the certification. If known, they may be 
identified in the grant application. If the grantee does not identify 
the workplaces at the time of application, or upon award, if there is no 
application, the grantee must keep the identity of the workplace(s) on 
file in its office and make the information available for Federal 
inspection. Failure to identify all known workplaces constitutes a 
violation of the grantee's drug-free workplace requirements.
    6. Workplace identifications must include the actual address of 
buildings (or parts of buildings) or other sites where work under the 
grant takes place. Categorical descriptions may be used (e.g., all 
vehicles of a mass transit authority or State highway department while 
in operation, State employees in each local unemployment office, 
performers in concert halls or radio studios).
    7. If the workplace identified to the agency changes during the 
performance of the grant, the grantee shall inform the agency of the 
change(s), if it previously identified the workplaces in question (see 
paragraph five).
    8. Definitions of terms in the Nonprocurement Suspension and 
Debarment common rule and Drug-Free Workplace common rule apply to this 
certification. Grantees' attention is called, in particular, to the 
following definitions from these rules:
    Controlled substance means a controlled substance in Schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812) and as 
further defined by regulation (21 CFR 1308.11 through 1308.15);
    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    Employee means the employee of a grantee directly engaged in the 
performance of work under a grant, including: (i) All direct charge 
employees; (ii) All indirect charge employees unless their impact or 
involvement is insignificant to the performance of the grant; and, (iii) 
Temporary personnel and consultants who are directly engaged in the 
performance of work under the grant and who are on the grantee's 
payroll. This definition does not include workers not on the payroll of 
the grantee (e.g., volunteers, even if used to meet a matching 
requirement; consultants or independent contractors not on the grantee's 
payroll; or employees of subrecipients or subcontractors in covered 
workplaces).

        Certification Regarding Drug-Free Workplace Requirements

             Alternate I. (Grantees Other Than Individuals)

    A. The grantee certifies that it will or will continue to provide a 
drug-free workplace by:
    (a) Publishing a statement notifying employees that the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance is prohibited in the grantee's workplace and 
specifying the actions that will be taken against employees for 
violation of such prohibition;
    (b) Establishing an ongoing drug-free awareness program to inform 
employees about--
    (1) The dangers of drug abuse in the workplace;

[[Page 467]]

    (2) The grantee's policy of maintaining a drug-free workplace;
    (3) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (4) The penalties that may be imposed upon employees for drug abuse 
violations occurring in the workplace;
    (c) Making it a requirement that each employee to be engaged in the 
performance of the grant be given a copy of the statement required by 
paragraph (a);
    (d) Notifying the employee in the statement required by paragraph 
(a) that, as a condition of employment under the grant, the employee 
will--
    (1) Abide by the terms of the statement; and
    (2) Notify the employer in writing of his or her conviction for a 
violation of a criminal drug statute occurring in the workplace no later 
than five calendar days after such conviction;
    (e) Notifying the agency in writing, within ten calendar days after 
receiving notice under paragraph (d)(2) from an employee or otherwise 
receiving actual notice of such conviction. Employers of convicted 
employees must provide notice, including position title, to every grant 
officer or other designee on whose grant activity the convicted employee 
was working, unless the Federal agency has designated a central point 
for the receipt of such notices. Notice shall include the identification 
number(s) of each affected grant;
    (f) Taking one of the following actions, within 30 calendar days of 
receiving notice under paragraph (d)(2), with respect to any employee 
who is so convicted--
    (1) Taking appropriate personnel action against such an employee, up 
to and including termination, consistent with the requirements of the 
Rehabilitation Act of 1973, as amended; or
    (2) Requiring such employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency;
    (g) Making a good faith effort to continue to maintain a drug-free 
workplace through implementation of paragraphs (a), (b), (c), (d), (e) 
and (f).
    B. The grantee may insert in the space provided below the site(s) 
for the performance of work done in connection with the specific grant:

Place of Performance (Street address, city, county, state, zip code)
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________

Check {time}  if there are workplaces on file that are not identified 
here.

              Alternate II. (Grantees Who Are Individuals)

    (a) The grantee certifies that, as a condition of the grant, he or 
she will not engage in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance in conducting 
any activity with the grant;
    (b) If convicted of a criminal drug offense resulting from a 
violation occurring during the conduct of any grant activity, he or she 
will report the conviction, in writing, within 10 calendar days of the 
conviction, to every grant officer or other designee, unless the Federal 
agency designates a central point for the receipt of such notices. When 
notice is made to such a central point, it shall include the 
identification number(s) of each affected grant.
[55 FR 21690, 21693, May 25, 1990]



PART 138--NEW RESTRICTIONS ON LOBBYING--Table of Contents




                           Subpart A--General

Sec.
138.100  Conditions on use of funds.
138.105  Definitions.
138.110  Certification and disclosure.

                 Subpart B--Activities by Own Employees

138.200  Agency and legislative liaison.
138.205  Professional and technical services.
138.210  Reporting.

            Subpart C--Activities by Other Than Own Employees

138.300  Professional and technical services.

                  Subpart D--Penalties and Enforcement

138.400  Penalties.
138.405  Penalty procedures.
138.410  Enforcement.

                          Subpart E--Exemptions

138.500  Secretary of Defense.

                        Subpart F--Agency Reports

138.600  Semi-annual compilation.
138.605  Inspector General report.

Appendix A to Part 138--Certification Regarding Lobbying
Appendix B to Part 138--Disclosure Form to Report Lobbying

    Authority:  Section 319, Public Law 101-121 (31 U.S.C. 1352); 22 
U.S.C. 2658.

    Source:  55 FR 6737 and 6749, Feb. 26, 1990, unless otherwise noted.

[[Page 468]]


    Cross reference:  See also Office of Management and Budget notice 
published at 54 FR 52306, December 20, 1989.



                           Subpart A--General



Sec. 138.100  Conditions on use of funds.

    (a) No appropriated funds may be expended by the recipient of a 
Federal contract, grant, loan, or cooperative ageement to pay any person 
for influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with any of the following 
covered Federal actions: the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (b) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or cooperative agreement shall file with that 
agency a certification, set forth in appendix A, that the person has not 
made, and will not make, any payment prohibited by paragraph (a) of this 
section.
    (c) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or a cooperative agreement shall file with that 
agency a disclosure form, set forth in appendix B, if such person has 
made or has agreed to make any payment using nonappropriated funds (to 
include profits from any covered Federal action), which would be 
prohibited under paragraph (a) of this section if paid for with 
appropriated funds.
    (d) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a statement, set forth in appendix A, whether that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.
    (e) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a disclosure form, set forth in appendix B, if that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.



Sec. 138.105  Definitions.

    For purposes of this part:
    (a) Agency, as defined in 5 U.S.C. 552(f), includes Federal 
executive departments and agencies as well as independent regulatory 
commissions and Government corporations, as defined in 31 U.S.C. 
9101(1).
    (b) Covered Federal action means any of the following Federal 
actions:
    (1) The awarding of any Federal contract;
    (2) The making of any Federal grant;
    (3) The making of any Federal loan;
    (4) The entering into of any cooperative agreement; and,
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an agency a 
commitment providing for the United States to insure or guarantee a 
loan. Loan guarantees and loan insurance are addressed independently 
within this part.
    (c) Federal contract means an acquisition contract awarded by an 
agency, including those subject to the Federal Acquisition Regulation 
(FAR), and any other acquisition contract for real or personal property 
or services not subject to the FAR.
    (d) Federal cooperative agreement means a cooperative agreement 
entered into by an agency.
    (e) Federal grant means an award of financial assistance in the form 
of money, or property in lieu of money, by the Federal Government or a 
direct

[[Page 469]]

appropriation made by law to any person. The term does not include 
technical assistance which provides services instead of money, or other 
assistance in the form of revenue sharing, loans, loan guarantees, loan 
insurance, interest subsidies, insurance, or direct United States cash 
assistance to an individual.
    (f) Federal loan means a loan made by an agency. The term does not 
include loan guarantee or loan insurance.
    (g) Indian tribe and tribal organization have the meaning provided 
in section 4 of the Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions 
of Indian tribes in that Act.
    (h) Influencing or attempting to influence means making, with the 
intent to influence, any communication to or appearance before an 
officer or employee or any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with any covered Federal action.
    (i) Loan guarantee and loan insurance means an agency's guarantee or 
insurance of a loan made by a person.
    (j) Local government means a unit of government in a State and, if 
chartered, established, or otherwise recognized by a State for the 
performance of a governmental duty, including a local public authority, 
a special district, an intrastate district, a council of governments, a 
sponsor group representative organization, and any other instrumentality 
of a local government.
    (k) Officer or employee of an agency includes the following 
individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, U.S. Code, including a position under a temporary 
appointment;
    (2) A member of the uniformed services as defined in section 101(3), 
title 37, U.S. Code;
    (3) A special Government employee as defined in section 202, title 
18, U.S. Code; and,
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the Federal Advisory Committee Act, title 5, U.S. Code 
appendix 2.
    (l) Person means an individual, corporation, company, association, 
authority, firm, partnership, society, State, and local government, 
regardless of whether such entity is operated for profit or not for 
profit. This term excludes an Indian tribe, tribal organization, or any 
other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (m) Reasonable compensation means, with respect to a regularly 
employed officer or employee of any person, compensation that is 
consistent with the normal compensation for such officer or employee for 
work that is not furnished to, not funded by, or not furnished in 
cooperation with the Federal Government.
    (n) Reasonable payment means, with respect to perfessional and other 
technical services, a payment in an amount that is consistent with the 
amount normally paid for such services in the private sector.
    (o) Recipient includes all contractors, subcontractors at any tier, 
and subgrantees at any tier of the recipient of funds received in 
connection with a Federal contract, grant, loan, or cooperative 
agreement. The term excludes an Indian tribe, tribal organization, or 
any other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (p) Regularly employed means, with respect to an officer or employee 
of a person requesting or receiving a Federal contract, grant, loan, or 
cooperative agreement or a commitment providing for the United States to 
insure or guarantee a loan, an officer or employee who is employed by 
such person for at least 130 working days within one year immediately 
preceding the date of the submission that initiates agency consideration 
of such person for receipt of such contract, grant, loan, cooperative 
agreement, loan insurance commitment, or loan guarantee commitment. An 
officer or employee who is employed by such person for less than 130 
working days within one year immediately preceding the date of the 
submission that initiates agency consideration of such person shall be 
considered to be regularly employed as

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soon as he or she is employed by such person for 130 working days.
    (q) State means a State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, a territory or possession of 
the United States, an agency or instrumentality of a State, and a multi-
State, regional, or interstate entity having governmental duties and 
powers.



Sec. 138.110  Certification and disclosure.

    (a) Each person shall file a certification, and a disclosure form, 
if required, with each submission that initiates agency consideration of 
such person for:
    (1) Award of a Federal contract, grant, or cooperative agreement 
exceeding $100,000; or
    (2) An award of a Federal loan or a commitment providing for the 
United States to insure or guarantee a loan exceeding $150,000.
    (b) Each person shall file a certification, and a disclosure form, 
if required, upon receipt by such person of:
    (1) A Federal contract, grant, or cooperative agreement exceeding 
$100,000; or
    (2) A Federal loan or a commitment providing for the United States 
to insure or guarantee a loan exceeding $150,000,

Unless such person previously filed a certification, and a disclosure 
form, if required, under paragraph (a) of this section.
    (c) Each person shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that requires 
disclosure or that materially affects the accuracy of the information 
contained in any disclosure form previously filed by such person under 
paragraphs (a) or (b) of this section. An event that materially affects 
the accuracy of the information reported includes:
    (1) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (2) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or,
    (3) A change in the officer(s), employee(s), or Member(s) contacted 
to influence or attempt to influence a covered Federal action.
    (d) Any person who requests or receives from a person referred to in 
paragraphs (a) or (b) of this section:
    (1) A subcontract exceeding $100,000 at any tier under a Federal 
contract;
    (2) A subgrant, contract, or subcontract exceeding $100,000 at any 
tier under a Federal grant;
    (3) A contract or subcontract exceeding $100,000 at any tier under a 
Federal loan exceeding $150,000; or,
    (4) A contract or subcontract exceeding $100,000 at any tier under a 
Federal cooperative agreement,

Shall file a certification, and a disclosure form, if required, to the 
next tier above.
    (e) All disclosure forms, but not certifications, shall be forwarded 
from tier to tier until received by the person referred to in paragraphs 
(a) or (b) of this section. That person shall forward all disclosure 
forms to the agency.
    (f) Any certification or disclosure form filed under paragraph (e) 
of this section shall be treated as a material representation of fact 
upon which all receiving tiers shall rely. All liability arising from an 
erroneous representation shall be borne solely by the tier filing that 
representation and shall not be shared by any tier to which the 
erroneous representation is forwarded. Submitting an erroneous 
certification or disclosure constitutes a failure to file the required 
certification or disclosure, respectively. If a person fails to file a 
required certification or disclosure, the United States may pursue all 
available remedies, including those authorized by section 1352, title 
31, U.S. Code.
    (g) For awards and commitments in process prior to December 23, 
1989, but not made before that date, certifications shall be required at 
award or commitment, covering activities occurring between December 23, 
1989, and the date of award or commitment. However, for awards and 
commitments in process prior to the December 23, 1989 effective date of 
these provisions, but not made before December 23, 1989, disclosure 
forms shall not be required at time of award or commitment but shall be 
filed within 30 days.

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    (h) No reporting is required for an activity paid for with 
appropriated funds if that activity is allowable under either subpart B 
or C.



                 Subpart B--Activities by Own Employees



Sec. 138.200  Agency and legislative liaison.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 138.100 (a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement if 
the payment is for agency and legislative liaison activities not 
directly related to a covered Federal action.
    (b) For purposes of paragraph (a) of this section, providing any 
information specifically requested by an agency or Congress is allowable 
at any time.
    (c) For purposes of paragraph (a) of this section, the following 
agency and legislative liaison activities are allowable at any time only 
where they are not related to a specific solicitation for any covered 
Federal action:
    (1) Discussing with an agency (including individual demonstrations) 
the qualities and characteristics of the person's products or services, 
conditions or terms of sale, and service capabilities; and,
    (2) Technical discussions and other activities regarding the 
application or adaptation of the person's products or services for an 
agency's use.
    (d) For purposes of paragraph (a) of this section, the following 
agencies and legislative liaison activities are allowable only where 
they are prior to formal solicitation of any covered Federal action:
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and,
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Public Law 95-507 and other subsequent amendments.
    (e) Only those activities expressly authorized by this section are 
allowable under this section.



Sec. 138.205  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 138.100 (a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement or 
an extension, continuation, renewal, amendment, or modification of a 
Federal contract, grant, loan, or cooperative agreement if payment is 
for professional or technical services rendered directly in the 
preparation, submission, or negotiation of any bid, proposal, or 
application for that Federal contract, grant, loan, or cooperative 
agreement or for meeting requirements imposed by or pursuant to law as a 
condition for receiving that Federal contract, grant, loan, or 
cooperative agreement.
    (b) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting of a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of

[[Page 472]]

his or her client's proposal, but generally advocate one proposal over 
another are not allowable under this section because the lawyer is not 
providing professional legal services. Similarly, communications with 
the intent to influence made by an engineer providing an engineering 
analysis prior to the preparation or submission of a bid or proposal are 
not allowable under this section since the engineer is providing 
technical services but not directly in the preparation, submission or 
negotiation of a covered Federal action.
    (c) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (d) Only those services expressly authorized by this section are 
allowable under this section.



Sec. 138.210  Reporting.

    No reporting is required with respect to payments of reasonable 
compensation made to regularly employed officers or employees of a 
person.



            Subpart C--Activities by Other Than Own Employees



Sec. 138.300  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 138.100 (a), does not apply in the case of any reasonable payment 
to a person, other than an officer or employee of a person requesting or 
receiving a covered Federal action, if the payment is for professional 
or technical services rendered directly in the preparation, submission, 
or negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) The reporting requirements in Sec. 138.110 (a) and (b) regarding 
filing a disclosure form by each person, if required, shall not apply 
with respect to professional or technical services rendered directly in 
the preparation, submission, or negotiation of any commitment providing 
for the United States to insure or guarantee a loan.
    (c) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting or a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of his or her client's 
proposal, but generally advocate one proposal over another are not 
allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (d) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.

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    (e) Persons other than officers or employees of a person requesting 
or receiving a covered Federal action include consultants and trade 
associations.
    (f) Only those services expressly authorized by this section are 
allowable under this section.



                  Subpart D--Penalties and Enforcement



Sec. 138.400  Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such expenditure.
    (b) Any person who fails to file or amend the disclosure form (see 
appendix B) to be filed or amended if required herein, shall be subject 
to a civil penalty of not less than $10,000 and not more than $100,000 
for each such failure.
    (c) A filing or amended filing on or after the date on which an 
administrative action for the imposition of a civil penalty is commenced 
does not prevent the imposition of such civil penalty for a failure 
occurring before that date. An administrative action is commenced with 
respect to a failure when an investigating official determines in 
writing to commence an investigation of an allegation of such failure.
    (d) In determining whether to impose a civil penalty, and the amount 
of any such penalty, by reason of a violation by any person, the agency 
shall consider the nature, circumstances, extent, and gravity of the 
violation, the effect on the ability of such person to continue in 
business, any prior violations by such person, the degree of culpability 
of such person, the ability of the person to pay the penalty, and such 
other matters as may be appropriate.
    (e) First offenders under paragraphs (a) or (b) of this section 
shall be subject to a civil penalty of $10,000, absent aggravating 
circumstances. Second and subsequent offenses by persons shall be 
subject to an appropriate civil penalty between $10,000 and $100,000, as 
determined by the agency head or his or her designee.
    (f) An imposition of a civil penalty under this section does not 
prevent the United States from seeking any other remedy that may apply 
to the same conduct that is the basis for the imposition of such civil 
penalty.



Sec. 138.405  Penalty procedures.

    Agencies shall impose and collect civil penalties pursuant to the 
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 
sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 
3812, insofar as these provisions are not inconsistent with the 
requirements herein.



Sec. 138.410  Enforcement.

    The head of each agency shall take such actions as are necessary to 
ensure that the provisions herein are vigorously implemented and 
enforced in that agency.



                          Subpart E--Exemptions



Sec. 138.500  Secretary of Defense.

    (a) The Secretary of Defense may exempt, on a case-by-case basis, a 
covered Federal action from the prohibition whenever the Secretary 
determines, in writing, that such an exemption is in the national 
interest. The Secretary shall transmit a copy of each such written 
exemption to Congress immediately after making such a determination.
    (b) The Department of Defense may issue supplemental regulations to 
implement paragraph (a) of this section.



                        Subpart F--Agency Reports



Sec. 138.600  Semi-annual compilation.

    (a) The head of each agency shall collect and compile the disclosure 
reports (see appendix B) and, on May 31 and November 30 of each year, 
submit to the Secretary of the Senate and the Clerk of the House of 
Representatives a report containing a compilation of the information 
contained in the disclosure reports received during the six-month period 
ending on March 31 or September 30, respectively, of that year.
    (b) The report, including the compilation, shall be available for 
public inspection 30 days after receipt of the report by the Secretary 
and the Clerk.

[[Page 474]]

    (c) Information that involves intelligence matters shall be reported 
only to the Select Committee on Intelligence of the Senate, the 
Permanent Select Committee on Intelligence of the House of 
Representatives, and the Committees on Appropriations of the Senate and 
the House of Representatives in accordance with procedures agreed to by 
such committees. Such information shall not be available for public 
inspection.
    (d) Information that is classified under Executive Order 12356 or 
any successor order shall be reported only to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives or the Committees on Armed Services of the 
Senate and the House of Representatives (whichever such committees have 
jurisdiction of matters involving such information) and to the 
Committees on Appropriations of the Senate and the House of 
Representatives in accordance with procedures agreed to by such 
committees. Such information shall not be available for public 
inspection.
    (e) The first semi-annual compilation shall be submitted on May 31, 
1990, and shall contain a compilation of the disclosure reports received 
from December 23, 1989 to March 31, 1990.
    (f) Major agencies, designated by the Office of Management and 
Budget (OMB), are required to provide machine-readable compilations to 
the Secretary of the Senate and the Clerk of the House of 
Representatives no later than with the compilations due on May 31, 1991. 
OMB shall provide detailed specifications in a memorandum to these 
agencies.
    (g) Non-major agencies are requested to provide machine-readable 
compilations to the Secretary of the Senate and the Clerk of the House 
of Representatives.
    (h) Agencies shall keep the originals of all disclosure reports in 
the official files of the agency.



Sec. 138.605  Inspector General report.

    (a) The Inspector General, or other official as specified in 
paragraph (b) of this section, of each agency shall prepare and submit 
to Congress each year, commencing with submission of the President's 
Budget in 1991, an evaluation of the compliance of that agency with, and 
the effectiveness of, the requirements herein. The evaluation may 
include any recommended changes that may be necessary to strengthen or 
improve the requirements.
    (b) In the case of an agency that does not have an Inspector 
General, the agency official comparable to an Inspector General shall 
prepare and submit the annual report, or, if there is no such comparable 
official, the head of the agency shall prepare and submit the annual 
report.
    (c) The annual report shall be submitted at the same time the agency 
submits its annual budget justifications to Congress.
    (d) The annual report shall include the following: All alleged 
violations relating to the agency's covered Federal actions during the 
year covered by the report, the actions taken by the head of the agency 
in the year covered by the report with respect to those alleged 
violations and alleged violations in previous years, and the amounts of 
civil penalties imposed by the agency in the year covered by the report.

        Appendix A to Part 138--Certification Regarding Lobbying

 Certification for Contracts, Grants, Loans, and Cooperative Agreements

    The undersigned certifies, to the best of his or her knowledge and 
belief, that:
    (1) No Federal appropriated funds have been paid or will be paid, by 
or on behalf of the undersigned, to any person for influencing or 
attempting to influence an officer or employee of an agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (2) If any funds other than Federal appropriated funds have been 
paid or will be paid to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
in connection with this Federal contract, grant, loan, or cooperative 
agreement, the undersigned shall complete

[[Page 475]]

and submit Standard Form-LLL, ``Disclosure Form to Report Lobbying,'' in 
accordance with its instructions.
    (3) The undersigned shall require that the language of this 
certification be included in the award documents for all subawards at 
all tiers (including subcontracts, subgrants, and contracts under 
grants, loans, and cooperative agreements) and that all subrecipients 
shall certify and disclose accordingly.
    This certification is a material representation of fact upon which 
reliance was placed when this transaction was made or entered into. 
Submission of this certification is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required certification shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

            Statement for Loan Guarantees and Loan Insurance

    The undersigned states, to the best of his or her knowledge and 
belief, that:
    If any funds have been paid or will be paid to any person for 
influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with this commitment 
providing for the United States to insure or guarantee a loan, the 
undersigned shall complete and submit Standard Form-LLL, ``Disclosure 
Form to Report Lobbying,'' in accordance with its instructions.
    Submission of this statement is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required statement shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

[[Page 476]]

       Appendix B to Part 138--Disclosure Form to Report Lobbying

[GRAPHIC] [TIFF OMITTED] TC06OC91.000


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[GRAPHIC] [TIFF OMITTED] TC06OC91.001


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[GRAPHIC] [TIFF OMITTED] TC06OC91.002


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                       SUBCHAPTER O--CIVIL RIGHTS





PART 141--NONDISCRIMINATION IN FEDERALLY-ASSISTED PROGRAMS OF THE DEPARTMENT OF STATE--EFFECTUATION OF TITLE VI OF THE CIVIL RIGHTS ACT OF 1964--Table of Contents




Sec.
141.1  Purpose.
141.2  Application of this part.
141.3  Discrimination prohibited.
141.4  Assurances required.
141.5  Compliance information.
141.6  Conduct of investigation.
141.7  Procedure for effecting compliance.
141.8  Hearings.
141.9  Decisions and notices.
141.10  Judicial review.
141.11  Effect on other regulations; forms and instructions.
141.12  Definitions.

Appendix A to Part 141--Grants and Activities to Which This Part Applies

    Authority:  Sec. 602, 78 Stat. 252, sec. 4, 63 Stat. 111, as 
amended; 42 U.S.C. 2000d-1, 22 U.S.C. 2658.

    Source:  30 FR 314, Jan. 9, 1965, unless otherwise noted.



Sec. 141.1  Purpose.

    The purpose of this part is to effectuate the provisions of title VI 
of the Civil Rights Act of 1964 (hereafter referred to as the ``Act'') 
to the end that no person in the United States shall, on the ground of 
race, color, or national origin, be excluded from participation in, be 
denied the benefits of, or be otherwise subjected to discrimination 
under any program or activity receiving Federal financial assistance 
from the Department of State.



Sec. 141.2  Application of this part.

    This part applies to any program for which Federal financial 
assistance, as defined in this part, is authorized under a law 
administered by the Department including, but not limited to, the 
federally-assisted programs and activities listed in appendix A of this 
part. It applies to Federal financial assistance of any form, including 
property which may be acquired as a result of and in connection with 
such assistance, extended under any such program after the effective 
date of this regulation, even if the application is approved prior to 
such effective date. This part does not apply to (a) any Federal 
financial assistance by way of insurance of guaranty contracts; (b) 
money paid, property transferred, or other assistance extended under any 
such program before the effective date of this regulation; (c) any 
assistance to any individual who is the ultimate beneficiary under any 
such program; or (d) any employment practice, under any such program, of 
any employer, employment agency, or labor organization, except to the 
extent described in Sec. 141.3 (d), or (e) any assistance to an activity 
carried on outside the United States by a person, institution, or other 
entity not located in the United States. The fact that a program or 
activity is not listed in appendix A of this part shall not mean, if 
title VI of the Act is otherwise applicable, that such program is not 
covered. Transfers of surplus property in the United States are subject 
to regulations issued by the Administrator of General Services (41 CFR 
101-6.2).
[38 FR 17945, July 5, 1973]



Sec. 141.3  Discrimination prohibited.

    (a) General. No person in the United States shall, on the ground of 
race, color, or national origin be excluded from participation in, be 
denied the benefits of, or be otherwise subjected to discrimination 
under any program to which this part applies.
    (b) Specific discriminatory actions prohibited. (1) A recipient 
under any program to which this part applies may not, directly or 
through contractual or other arrangements on ground of race, color or 
national origin:
    (i) Deny an individual any service, financial aid, or other benefits 
provided under the program;
    (ii) Provide any service, financial aid, or other benefits to an 
individual which is different, or is provided in a different manner, 
from that provided to others under the program;

[[Page 480]]

    (iii) Subject an individual to segregation or separate treatment in 
any matter related to his receipt of any service, financial aid, or 
other benefit under the program;
    (iv) Restrict an individual in any way in the enjoyment of any 
advantage or privilege enjoyed by others receiving any service, 
financial aid, or other benefit under the program;
    (v) Treat an individual differently from others in determining 
whether he satisfies any admission, enrollment, quota, eligibility, 
membership or other requirement or condition which individuals must meet 
in order to be provided any service, financial aid, or other benefit 
provided under the program;
    (vi) Deny an individual an opportunity to participate in the program 
through the provision of services or otherwise afford him an opportunity 
to do so which is different from that afforded others under the program, 
including the opportunity to participate in the program as an employee 
in accordance with paragraph (d) of this section.
    (vii) Deny a person the opportunity to participate as a member of a 
planning or advisory body which is an integral part of the program.
    (2) A recipient, in determining the types of services, financial 
aid, or other benefits, or facilities which will be provided under any 
such program, or the location or site of any facilities, or services, or 
the class of individuals to whom, or the situations in which, such 
services, financial aid, other benefits, or facilities will be provided 
under any such program or the class of individuals to be afforded an 
opportunity to participate in any such program, may not, directly or 
through contractual or other arrangements, utilize criteria or methods 
of administration or select locations or sites for any facilities or 
services, which have the effect of subjecting individuals to 
discrimination because of their race, color, or national origin, or have 
the effect of defeating or substantially impairing accomplishment of the 
objectives of the program as respect individuals of a particular race, 
color, or national origin.
    (3) As used in this section the services, financial aid, or other 
benefits provided under a program receiving Federal financial assistance 
shall be deemed to include any service, financial aid, or other benefit 
provided in or through a facility provided with the aid of Federal 
financial assistance.
    (4) The enumeration of specific forms of prohibited discrimination 
in this paragraph does not limit the generality of the prohibition in 
paragraph (a) of this section.
    (5)(i) In administering a program regarding which the recipient has 
previously discriminated against persons on the ground of race, color, 
or national origin, the recipient must take affirmative action to 
overcome the effects of prior discrimination.
    (ii) Even in the absence of such prior discrimination, a recipient 
in administering a program may take affirmative action to overcome the 
effects of conditions which resulted in limiting participation by 
persons of a particular race, color, or national origin.
    (c) Special programs. An individual shall not be deemed subjected to 
discrimination by reason of his exclusion from the benefits of a program 
limited by Federal law to individuals of a particular race, color, or 
national origin different from his.
    (d) Employment practices. (1) Where a primary objective of the 
Federal financial assistance to a program to which this part applies is 
to provide employment, a recipient may not (directly or through 
contractual or other arrangements) subject an individual to 
discrimination on the ground of race, color, or national origin in its 
employment practices under such program (including recruitment or 
recruitment advertising, employment layoff or termination, upgrading, 
demotion, or transfer, rates of pay or other forms of compensation, and 
use of facilities), including programs where a primary objective of the 
Federal financial assistance is: (i) To reduce the unemployment of such 
individuals or to help them through employment to meet subsistence 
needs; (ii) to assist such individuals through employment to meet 
expenses incident to the commencement or continuation of their education 
or training; (iii) to provide work experience which contributes to the 
education or training of such individuals;

[[Page 481]]

or (iv) to provide remunerative activity to such individuals who because 
of severe handicaps cannot be readily absorbed in the competitive labor 
market.
    (2) Where a primary objective of the Federal financial assistance is 
not to provide employment, but discrimination on the grounds of race, 
color, or national origin in the employment practices of the recipient 
or other persons subject to the regulation tends, on the grounds of 
race, color, or national origin, to exclude individuals from 
participation in, to deny them the benefits of, or to subject them to 
discrimination under any program to which this regulation applies, the 
provisions of paragraph (d)(1) of this section shall apply to the 
employment practices of the recipient or other persons subject to the 
regulation, to the extent necessary to assure equality of opportunity 
to, and nondiscriminatory treatment of, beneficiaries.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17946, July 5, 1973]



Sec. 141.4  Assurances required.

    (a) General. (1) Every application for Federal financial assistance 
to carry out a program to which this part applies, as a condition to its 
approval and the extension of any Federal financial assistance pursuant 
to the application, shall contain or be accompanied by an assurance that 
the program will be conducted or the facility operated in compliance 
with all requirements imposed by or pursuant to this part. The assurance 
shall obligate the recipient for the period during which Federal 
financial assistance is extended pursuant to the application.
    (2) In any case where the Federal assistance is to provide, or is in 
the form of personal property, or real property or structures or any 
interest therein, or such property is acquired as a result of and in 
connection with such assistance, the assurance shall obligate the 
recipient, or, in case of subsequent transfers, the transferees, for the 
period during which the property is used for a purpose for which the 
Federal assistance was, or is extended, or for another purpose involving 
the provision of similar services and benefits, or for as long as the 
recipient retains ownership or possession of the property, whichever is 
longer. Any assurance relating to property provided under or acquired as 
a result of or in connection with such assistance shall as appropriate 
require any instrument effecting or recording transfer, title or other 
evidence of ownership or right to possession, to include a covenant or 
condition assuring nondiscrimination for the period of obligation of the 
recipient or any transferee, which may contain a right to be reserved to 
the Department to revert title or right to possession. Where no transfer 
of property is involved, but property is improved or any interest of the 
recipient or transferee therein is increased as a result of a program of 
Federal financial assistance, the recipient or transferee shall agree to 
include such covenant or condition in any subsequent transfer of such 
property. Failure to comply with any such conditions or requirements 
contained in such assurances shall render the recipient and the 
transferees, where appropriate, presumptively in noncompliance.
    (3) The responsible Departmental official shall specify the form of 
the foregoing assurances for each program, and the extent to which like 
assurances will be required of subgrantees, contractors and 
subcontractors, transferees, successors in interest, and other 
participants in the program. Any such assurance shall include provisions 
which give the United States a right to seek its judicial enforcement.
    (b) Assurances from institutions. (1) In the case of any application 
for Federal financial assistance to an institution of higher education, 
including assistance for construction, for research, for a special 
training project, for a student loan program, or for any other purpose, 
the assurance required by this section shall extend to admission 
practices and to all other practices relating to the treatment of 
students.
    (2) The assurance required with respect to an institution of higher 
education, or any other institution, insofar as the assurance relates to 
the institution's practices with respect to admission or other treatment 
of individuals as students, or clients of the institution or to the 
opportunity to participate in the provision of services or

[[Page 482]]

other benefits to such individuals, shall be applicable to the entire 
institution unless the applicant establishes, to the satisfaction of the 
responsible Department official, that the institution's practices in 
designated parts or programs of the institution will in no way affect 
its practices in the program of the institution for which Federal 
financial assistance is sought, or the beneficiaries of or participants 
in such program.
    (c) Elementary and secondary schools. The requirements of paragraph 
(a)(1) of this section, with respect to any elementary or secondary 
school or school system shall be deemed to be satisfied if such school 
or school system (1) is subject to a final order of a court of the 
United States for the desegregation of such school or school system, and 
provides an assurance that it will comply with such order, or (2) 
submits a plan the desegregation of such school or school system which 
the responsible official of the Department of Health, Education, and 
Welfare determines is adequate to accomplish the purposes of the Act and 
this part within the earliest practicable time, and provides reasonable 
assurance that it will carry out such plan; in any case of continuing 
Federal financial assistance the responsible official of the Department 
of Health, Education and Welfare may reserve the right to redetermine, 
after such period as may be specified by him the adequacy of the plan to 
accomplish the purposes of the Act and this part. In any case in which a 
final order of a court of the United States for the desegregation of 
such school or school system is entered after submission of such a plan, 
such plan shall be revised to conform to such final order, including any 
future modification of such order.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17946, July 5, 1973]



Sec. 141.5  Compliance information.

    (a) Cooperation and assistance. Each responsible Department official 
shall to the fullest extent practicable seek the cooperation of 
recipients in obtaining compliance with this regulation and shall 
provide assistance and guidance to recipients to help them comply 
voluntarily with this part.
    (b) Compliance reports. Each recipient shall keep such records and 
submit to the responsible Departmental official or his designee timely, 
complete and accurate compliance reports at such times, and in such form 
and containing such information, as a responsible Departmental official 
or his designee may determine to be necessary to enable him to ascertain 
whether the recipient has complied or is complying with this part. In 
general, recipients should have available for the Department racial and 
ethnic data showing the extent to which members of minority groups are 
beneficiaries of Federally assisted programs. In the case of any program 
under which a primary recipient extends Federal financial assistance to 
any other recipient, such other recipient shall also submit such 
compliance reports to the primary recipient as may be necessary to 
enable the primary recipient to carry out his obligations under this 
part.
    (c) Access to sources of information. Each recipient shall permit 
access by the responsible Department official or his designee during 
normal business hours to such of its books, records, accounts, and other 
sources of information, and its facilities as may be pertinent to 
ascertain compliance with this part. Where any information required of a 
recipient is in the exclusive possession of any other agency, 
institution or person and this agency, institution or person shall fail 
or refuse to furnish this information, the recipient shall so certify in 
its report and shall set forth what efforts it has made to obtain the 
information.
    (d) Information to beneficiaries and participants. Each recipient 
shall make available to participants, beneficiaries, and other 
interested persons such information regarding the provisions of this 
part and its applicability to the program under which the recipient 
receives Federal financial assistance, and make such information 
available to them in such manner, as the responsible Department official 
finds necessary to apprise such persons of the protections against 
discrimination assured them by the Act and this part.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17947, July 5, 1973]

[[Page 483]]



Sec. 141.6  Conduct of investigation.

    (a) Periodic compliance reviews. The responsible Department official 
or his designee shall from time to time review the practices of 
recipients to determine whether they are complying with this part.
    (b) Complaints. Any person who believes himself or any specific 
class of individual to be subjected to discrimination prohibited by this 
part may by himself or by a representative file with the responsible 
Departmental official a written complaint. A complaint must be filed not 
later than 180 days from the date of the alleged discrimination, unless 
the time for filing is extended by the responsible Departmental official 
or his designee.
    (c) Investigations. The responsible Department official or his 
designee will make a prompt investigation whenever a compliance review, 
report, complaint, or any other information indicates a possible failure 
to comply with this part. The investigation should include, where 
appropriate, a review of the pertinent practices and policies of the 
recipient, the circumstances under which the possible noncompliance with 
this part occurred, and other factors relevant to a determination as to 
whether the recipient has failed to comply with this part.
    (d) Resolution of matters. (1) If an investigation pursuant to 
paragraph (c) of this section indicates a failure to comply with this 
part, the responsible Department official or his designee will so inform 
the recipient and the matter will be resolved by informal means whenever 
possible. If it has been determined that the matter cannot be resolved 
by informal means, action will be taken as provided for in Sec. 141.7.
    (2) If an investigation does not warrant action pursuant to 
paragraph (d)(1) of this section the responsible Department official or 
his designee will so inform the recipient and the complainant, if any, 
in writing.
    (e) Intimidatory or retaliatory acts prohibited. No recipient or 
other person shall intimidate, threaten, coerce, or discriminate against 
any individual for the purpose of interfering with any right or 
privilege secured by section 601 of the Act or this part, or because he 
has made a complaint, testified, assisted, or participated in any manner 
in an investigation, proceeding, or hearing under this part. The 
identity of complainants shall be kept confidential except to the extent 
necessary to carry out the purposes of this part, including the conduct 
of any investigation, hearing, or judicial proceeding arising 
thereunder.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17947, July 5, 1973]



Sec. 141.7  Procedure for effecting compliance.

    (a) General. If there appears to be a failure or threatened failure 
to comply with this part, and if the noncompliance or threatened 
noncompliance cannot be corrected by informal means, compliance with 
this part may be effected by the suspension or termination of or refusal 
to grant or to continue Federal financial assistance or by any other 
means authorized by law. Such other means may include, but are not 
limited to, (1) a reference to Department of Justice with a 
recommendation that appropriate proceedings be brought to enforce any 
rights of the United States under any law of the United States 
(including other titles of the Act), or any assurance or other 
contractual undertaking, and (2) any applicable proceeding under State 
or local law.
    (b) Noncompliance with Sec. 141.4. If an applicant fails or refused 
to furnish an assurance required under Sec. 141.4 or otherwise fails or 
refuses to comply with a requirement imposed by or pursuant to that 
section Federal financial assistance may be refused in accordance with 
the procedures of paragraph (c) of this section. The Department shall 
not be required to provide assistance in such a case during the pendency 
of the administrative proceedings under such paragraph except that the 
Department shall continue assistance during the pendency of such 
proceedings where such assistance is due and payable pursuant to an 
application therefor approved prior to the effective date of this part.
    (c) Termination of or refusal to grant or to continue Federal 
financial assistance. No order suspending, terminating or refusing to 
grant or continue Federal

[[Page 484]]

financial assistance shall become effective until (1) the responsible 
Department official has advised the applicant or recipient of his 
failure to comply and has determined that compliance cannot be secured 
by voluntary means, (2) there has been an express finding on the record, 
after opportunity for hearing, of a failure by the applicant or 
recipient to comply with a requirement imposed by or pursuant to this 
part, (3) the action has been approved by the Secretary pursuant to 
Sec. 141.9(e), and (4) the expiration of 30 days after the Secretary has 
filed with the committee of the House and the committee of the Senate 
having legislative jurisdiction over the program involved, a full 
written report of the circumstances and the grounds for such action. Any 
action to suspend or terminate or to refuse to grant or to continue 
Federal financial assistance shall be limited to the particular 
political entity, or part thereof, or other applicant or recipient as to 
whom such a finding has been made and shall be limited in its effect to 
the particular program, or part thereof, in which such noncompliance has 
been so found.
    (d) Other means authorized by law. No action to effect compliance by 
any other means authorized by law shall be taken until (1) the 
responsible Department official has determined that compliance cannot be 
secured by voluntary means, (2) the action has been approved by the 
Deputy Under Secretary for Administration, (3) the recipient or other 
person has been notified of its failure to comply and of the action to 
be taken to effect compliance, and (4) the expiration of at least 10 
days from the mailing of such notice to the recipient or other person. 
During this period of at least 10 days additional efforts shall be made 
to persuade the recipient or other person to comply with this part and 
to take such corrective action as may be appropriate.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17947 July 5, 1973]



Sec. 141.8  Hearings.

    (a) Opportunity for hearing. Whenever an opportunity for a hearing 
is required by Sec. 141.7(c), reasonable notice shall be given by 
registered or certified mail, return receipt requested, to the affected 
applicant or recipient. This notice shall advise the applicant or 
recipient of the action proposed to be taken, the specific provision 
under which the proposed action against it is to be taken and the 
matters of fact or law asserted as the basis for this action, and either 
(1) fix a date not less than 20 days after the date or such notice 
within which the applicant or recipient may request of the responsible 
Department official that the matter be scheduled for hearing or (2) 
advise the applicant or recipient that the matter in question has been 
set down for hearing at a stated place and time. The time and place so 
fixed shall be reasonable and shall be subject to change for cause. The 
complainant, if any, shall be advised of the time and place of the 
hearing. An applicant or recipient may waive a hearing and submit 
written information and argument for the record. The failure of an 
applicant or recipient to request a hearing under this paragraph or to 
appear at a hearing for which a date has been set shall be deemed to be 
a waiver of the right to a hearing under section 602 of the Act and 
Sec. 141.7(c) of this part and consent to the making of a decision on 
the basis of such information as is available.
    (b) Time and place of hearing. Hearings shall normally be held at 
the offices of the Department in Washington, DC, at a time fixed by the 
responsible Department official. Hearings shall be held before an 
official designated by the Secretary other than the responsible 
Department official, in accordance with 5 U.S.C. 3105 and 3344 (formerly 
Section 11 of the Administrative Procedure Act).
    (c) Right to counsel. In all proceedings under this section, the 
applicant or recipient and the Department shall have the right to be 
represented by counsel.
    (d) Procedures, evidence, and record. (1) The hearing, decision, and 
any administrative review thereof shall be conducted with as much 
conformity as is practicable with 5 U.S.C. 554-557 (formerly sections 5-
8 of the Administrative Procedure Act) and in accordance with such rules 
of procedure as are proper (and not inconsistent with this section) 
relating to the conduct of the hearing, giving of notices subsequent to 
those provided for in paragraph (a)

[[Page 485]]

of this section, taking of testimony, exhibits, arguments and briefs, 
requests for findings, and other related matters. Both the Department 
and the applicant or recipient shall be entitled to introduce all 
relevant evidence on the issues as stated in the notice for hearing or 
as determined by the officer conducting the hearing at the outset of or 
during the hearing.
    (2) Technical rules of evidence shall not apply to hearings 
conducted pursuant to this part, but rules or principles designed to 
assure production of the most credible evidence available and to subject 
testimony to test by cross-examination shall be applied where reasonably 
necessary by the officer conducting the hearing. The office presiding at 
the hearing may exclude irrelevant, immaterial, or unduly repetitious 
evidence. All documents and other evidence offered or taken for the 
record shall be open to examination by the parties and opportunity shall 
be given to refute facts and arguments advanced on either side of the 
issues. A transcript shall be made of the oral evidence except to the 
extent the substance thereof is stipulated for the record. All decisions 
shall be based upon the hearing record and written findings shall be 
made.
    (e) Consolidated or joint hearings; hearings before other agencies. 
In cases in which the same or related facts are asserted to constitute 
noncompliance with this part with respect to two or more programs to 
which this part applies, or noncompliance with this part and regulations 
of one or more other Federal departments or agencies issued under title 
VI of the Act, the Secretary may, by agreement with such other 
departments or agencies where applicable, provide for the conduct of 
consolidated or joint hearings, and for the application to such hearings 
of rules of procedures not inconsistent with this part, except that 
procedural requirements of the hearing agency if other than this 
Department may be adopted insofar as it is determined by the Secretary 
that variations from the procedures described in this section or 
elsewhere as may be required under this part do not impair the rights of 
the parties. The Secretary may also transfer the hearing of any 
complaint to any other department or agency, with the consent of that 
Department or Agency (1) where Federal financial assistance to the 
applicant or recipient of the other Department or Agency is 
substantially greater than that of the Department of State, or (2) upon 
determination by the Secretary that such transfer would be in the best 
interests of the Government of effectuating this part. Final decisions 
in all such cases, insofar as this part is concerned, shall be made in 
accordance with Sec. 141.9.
[30 FR 314, Jan 9, 1965, as amended at 38 FR 17947, July 5, 1973]



Sec. 141.9  Decisions and notices.

    (a) Decisions on record or review by the responsible Department 
official. The applicant or recipient shall be given reasonable 
opportunity to file with the officer presiding at the hearing briefs or 
other written statements of its contentions, and a copy of the final 
decision shall be given in writing to the applicant or recipient and to 
the complainant, if any. The officer presiding at the hearing shall 
render a decision on the matter.
    (b) Decisions on record where a hearing is waived. Whenever a 
hearing is waived pursuant to Sec. 141.8(a) a decision shall be made by 
the responsible Departmental official on the record and a copy of such 
decision shall be given in writing to the applicant or recipient, and to 
the complainant, if any.
    (c) Rulings required. Each decision of an officer presiding at the 
hearing shall set forth his ruling on each finding, conclusion, or 
exception presented, and shall identify the requirement or requirements 
imposed by or pursuant to this part with which it is found that the 
applicant or recipient has failed to comply.
    (d) Appeal. Either party may appeal from a decision of the officer 
presiding at the hearing to the responsible Department official within 
30 days of the mailing of the officer's decision. In the absence of such 
an appeal the decision of the officer presiding at the hearings shall 
constitute the final decision of the Department subject to paragraph (e) 
of this section.
    (e) Approval by Secretary. Any final decision by an officer (other 
than the

[[Page 486]]

Secretary) which provides for the suspension or termination of, or the 
refusal to grant or continue Federal financial assistance, or the 
imposition of any other sanction available under this part or the Act, 
shall promptly be transmitted to the Secretary who may approve such 
decision, may vacate it, or remit or mitigate any sanction imposed.
    (f) Content of orders. The final decision may provide for suspension 
or termination of, or refusal to grant or continue Federal financial 
assistance, in whole or in part, under the program involved, and may 
contain such terms, conditions, and other provisions as are consistent 
with and will effectuate the purposes of the Act and this part, 
including provisions designed to assure that no Federal financial 
assistance will thereafter be extended under such program to the 
applicant or recipient determined by such decision to be in default in 
its performance of an assurance given by it pursuant to this part, or to 
have otherwise failed to comply with this part, unless and until it 
corrects its noncompliance and satisfies the responsible Department 
official that it will fully comply with this part.
    (g) Post-termination proceedings. (1) An applicant or recipient 
adversely affected by an order issued under paragraph (f) of this 
section shall be restored to full eligibility to receive Federal 
financial assistance if it satisfies the terms and conditions of that 
order for such eligibility or if it brings itself into compliance with 
this regulation and provides reasonable assurance that it will fully 
comply with this regulation.
    (2) Any applicant or recipient adversely affected by an order 
entered pursuant to paragraph (f) of this section may at any time 
request the responsible Departmental official to restore fully its 
eligibility to receive Federal financial assistance. Any such request 
shall be supported by information establishing that the applicant or 
recipient has met the requirements of paragraph (g)(1) of this section. 
If the responsible Departmental official determines that those 
requirements have been satisfied, he shall restore such eligibility, but 
such determination shall be in writing and shall be supported by 
evidence and findings of fact which shall be retained by the Department.
    (3) If the responsible Departmental official denies any such 
request, the applicant or recipient may submit a request for a hearing 
in writing, specifying why it believes such official to have been in 
error. It shall thereupon be given an expeditious hearing, with a 
decision on the record, in accordance with rules of procedure issued by 
the responsible Departmental official. The burden of substantiating 
compliance with the requirements of paragraph (g)(1) of this section 
shall be on the applicant or recipient. While proceedings under this 
paragraph are pending, the sanctions imposed by the order issued under 
paragraph (f) of this section shall remain in effect.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17947, July 5, 1973]



Sec. 141.10  Judicial review.

    Action taken pursuant to section 602 of the Act is subject to 
judicial review as provided in section 603 of the Act.



Sec. 141.11  Effect on other regulations; forms and instructions.

    Nothing in this part shall be deemed to supersede: Executive Orders 
10925 and 11114 and regulations issued thereunder, or any other 
regulations or instructions, insofar as such regulations, or 
instructions prohibit discrimination on the ground of race, color, or 
national origin in any program or situation to which this regulation is 
inapplicable, or prohibit discrimination on any other ground.
    (a) Forms and instructions. Each responsible Department official 
shall issue, and promptly make available to interested persons, forms 
and detailed instructions and procedures for effectuating this part as 
applied to programs to which this part applies and for which he is 
responsible.
    (b) Supervision and coordination. The Secretary may, from time to 
time, assign to officials of the Department, or to officials of other 
departments or agencies of the Government with the consent of such 
department or agencies, responsibilities in connection with the 
effectuation of the purposes of title VI of the Act and this part 
including the achievement of effectiveness

[[Page 487]]

coordination and maximum uniformity within the Department and within the 
executive branch of the Government in the application of title VI and 
this part to similar programs and in similar situations. Any action 
taken, determination made, or requirement imposed by an official of 
another department or agency acting pursuant to an assignment of 
responsibility under this subsection shall have the same effect as 
though such action had been taken by the responsible official of this 
Department.
[22 FR 10882, Dec. 27, 1957, as amended at 38 FR 19748, July 5, 1973]



Sec. 141.12  Definitions.

    As used in this part--
    (a) The term Department means the Department of State and includes 
each of its operating agencies and other organizational units except the 
Agency for International Development.
    (b) The term Secretary means the Secretary of State.
    (c) The term responsible Department official with respect to any 
program receiving Federal financial assistance means the official of the 
Department having responsibility within the Department for the program 
extending such assistance or such official of the Department as the 
Secretary designates.
    (d) The term United States means the States of the United States, 
the District of Columbia, Puerto Rico, the Virgin Islands, American 
Samoa, Guam, Wake Island, the Canal Zone, and the territories and 
possessions of the United States, and the term State means any one of 
the foregoing.
    (e) The term Federal financial assistance includes (1) grants and 
loans of Federal funds, (2) the grant or donation of Federal property 
and interests in property, (3) the detail of Federal personnel, and (4) 
any Federal agreement, arrangement, or other contract which has as one 
of its purposes the provision of assistance or other benefits to 
individuals whether provided through employees of the recipient of 
Federal financial assistance or provided by others through contracts or 
other arrangements with the recipient.
    (f) The term program includes any program, project, or activity for 
the provision of services, financial aid, or other benefits to 
individuals whether provided through employees of the recipient of 
Federal financial assistance or provided by others through contracts or 
other arrangements with the recipient. Services, financial aid, or other 
benefits shall include those provided with the aid of or through any 
facility provided for by the aid of any non-Federal funds, property, or 
other resources required to be expended or made available for the 
program to meet matching requirements or other conditions in order to 
receive Federal assistance.
    (g) The term recipient means any State, political subdivision of any 
State, or instrumentality of any State or political subdivision, any 
public or private agency, institution, or organization, or other entity, 
or any individual, in any State to whom Federal financial assistance is 
extended directly or through another recipient, for any program, 
including any successor, assign, or transferee thereof, but such term 
does not include any ultimate beneficiary under any such program.
    (h) The term primary recipient means any recipient which is 
authorized or required to extend Federal financial assistance to another 
recipient for the purpose of carrying out a program.
    (i) The term applicant means one who submits an application, 
request, or plan required to be approved by a responsible Department 
official, or by a primary recipient, as a condition to eligibility for 
Federal financial assistance, and the term application means such an 
application, request, or plan.
    (j) The term facility includes all or any portion of structures, 
equipment, or other real or personal property or interests therein, and 
the provision of facilities includes the construction, expansion, 
renovation, remodeling, alteration, or acquisition of facilities.
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17948, July 5, 1973]

Appendix A to Part 141--Grants and Activities to Which This Part Applies

    1. Mutual understanding between people of the United States and the 
people of other countries by educational and cultural exchange--studies, 
research, instruction and

[[Page 488]]

other educational activities--cultural exchanges (Mutual Educational and 
Cultural Exchange Act of 1961--75 Stat. 527-538).
    2. Center for Cultural and Technical Interchange Between East and 
West--grant to State of Hawaii (Pub. L. 86-472, 74 Stat. 141).
    3. Assistance to or in behalf of refugees designated by the 
President (Migration and Refugee Assistance Act of 1962--76 Stat. 121-
124).
    4. Donations of certain foreign language tapes and other training 
material to public and private institutions (Regulations of 
Administrator of General Services relating to surplus property--41 CFR 
101-6.2).
[30 FR 314, Jan. 9, 1965, as amended at 38 FR 17948, July 5, 1973]



PART 142--NONDISCRIMINATING ON THE BASIS OF HANDICAP IN PROGRAMS AND ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE--Table of Contents




                      Subpart A--General Provisions

Sec.
142.1  Purpose.
142.2  Application.
142.3  Definitions.
142.4  Discrimination prohibited.
142.5  Assurances required.
142.6  Remedial action, voluntary action, and self-evaluation.
142.7  Designation of responsible employee and adoption of grievance 
          procedures.
142.8  Notice.
142.9  Administrative requirements for small recipients.
142.10  Effect of state and local law or other requirements and effect 
          of employment opportunities.

                     Subpart B--Employment Practices

142.11  Discrimination prohibited.
142.12  Reasonable accommodation.
142.13  Employment criteria.
142.14  Preemployment inquiries.

                    Subpart C--Program Accessibility

142.15  Discrimination prohibited.
142.16  Existing facilities.
142.17  New construction.
142.18--142.40  [Reserved]

                   Subpart D--Postsecondary Education

142.41  Application of this subpart.
142.42  Admissions and recruitment.
142.43  Treatment of students; general.
142.44  Academic adjustments.
142.45  Housing.
142.46  Financial and employment assistance to students.
142.47  Nonacademic services.
142.48--142.60  [Reserved]

         Subpart E--Health, Welfare, Social, and Other Services

142.61  Application of this subpart.
142.62  Health, welfare, social, and other services.
142.63  Drug and alcohol addicts.

                          Subpart F--Procedures

142.70  Procedures.

Appendix A to Part 142--Grants and Activities to Which This Part Applies

    Authority:  29 U.S.C. 794.

    Source:  45 FR 69438, Oct. 21, 1980, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 142.1  Purpose.

    The purpose of this part is to effectuate section 504 of the 
Rehabilitation Act of 1973, which is designed to eliminate 
discrimination on the basis of handicap in any program or activity 
receiving Federal financial assistance.   



Sec. 142.2  Application.

    This part applies to all programs directly affecting handicapped 
individuals in the United States carried on by recipients of Federal 
financial assistance pursuant to any authority held or delegated by the 
Secretary of State, including the federally-assisted programs and 
activities listed in appendix A of this part. (appendix A may be revised 
from time-to-time by notice in the Federal Register.) It applies to 
money paid, property transferred, or other Federal financial assistance 
extended under any such program after the effective date of this 
regulation, even if the application for such assistance is approved 
prior to such effective date. This part does not apply to:
    (a) Any Federal financial assistance by way of insurance or guaranty 
contracts;
    (b) Money paid, property transferred or other assistance extended 
under any such program before the effective date of this part;
    (c) Any assistance to any individual who is the ultimate beneficiary 
under any such program; and

[[Page 489]]

    (d) Any procurement of goods or services, including the procurement 
of training. This part does not bar selection and treatment reasonably 
related to the foreign affairs objective or such other authorized 
purpose as the Federal assistance may have. It does not bar selections 
which are limited to particular groups where the purpose of the program 
calls for such a limitation, nor does it bar special treatment including 
special courses of training, orientation or counseling consistent with 
such purpose.



Sec. 142.3  Definitions.

    As used in this part, the term:
    (a) Executive order means Executive Order 11914, entitled 
``Nondiscrimination with Respect to the Handicapped in Federally-
Assisted Programs,'' issued April 28, 1976.
    (b) The Act means the Rehabilitation Act of 1973, Pub. L. 93-112, as 
amended by the Rehabilitation Act Amendments of 1974, Pub. L. 93-516, 
and the Rehabilitation Act of Amendments of 1978, Pub. L. 95-602.
    (c) Section 504 means section 504 of the Rehabilitation Act of 1973, 
Pub. L. 93-112, as amended by the Rehabilitation Act Amendments of 1974, 
Pub. L. 93-516, 29 U.S.C. 794: amendments of 1978, Pub. L. 95-602.
    (d) Department means the Department of State and includes each of 
its organizational units. It does not include the Agency for 
International Development.
    (e) Secretary means the Secretary of State or any officer or 
employee of the Department to whom the Secretary has heretofore 
delegated, or to whom the Secretary may hereafter delegate, the 
authority to act under the regulations in this part.
    (f) Recipient means any State or its political subdivision, any 
instrumentality of a state or its political subdivision, any public or 
private agency, institution, organization, or other entity, or any 
person to which Federal financial assistance is extended directly or 
through another recipient, including any successor, assignee, or 
transferee of a recipient, but excluding the ultimate beneficiary of the 
assistance and any sovereign foreign government.
    (g) Applicant for Assistance means one who submits an application, 
request, or plan required to be approved by a Department official or by 
a recipient as a condition or becoming a recipient.
    (h) Federal financial assistance means any grant, loan, contract 
(other than a procurement contract or a contract of insurance or 
guaranty), cooperative agreement, or any other arrangement by which the 
Department provides or otherwise makes available assistance in the form 
of:
    (1) Funds;
    (2) Services of Federal personnel; or
    (3) Real and personal property or any interest in or use of such 
property, including:
    (i) Transfers or leases of such property for less than fair market 
value or for reduced consideration; and
    (ii) Proceeds from a subsequent transfer or lease of such property 
if the Federal share of its fair market value is not returned to the 
Federal Government.
    (i) Facility means all or any portion of buildings, structures, 
equipment, roads, walks, parking lots, or other real or personal 
property or interest in such property.
    (j) Handicapped person. (1) means any person who: (i) has a physical 
or mental impairment which substantially limits one or more major life 
activities, (ii) has a record of such an impairment, or (iii) is 
regarded as having such an impairment.
    (2) As used in paragraph (j)(1) of this section, the phrase:
    (i) Physical or mental impairment means (A) any physiological 
disorder or condition, cosmetic disfigurement, or anatomical loss 
affecting one or more of the following body systems: Neurological; 
musculoskeletal; special sense organs; respiratory, including speech 
organs; cardiovascular; reproductive, digestive; genitourinary; hemic 
and lymphatic; skin; and endocrine; or (B) any mental or psychological 
disorder, such as mental retardation, organic brain syndrome, emotional 
or mental illness, and specific learning disabilities. The term 
``physical or mental impairment'' includes, but is not limited to, such 
diseases and conditions as orthopedic, visual,

[[Page 490]]

speech, and hearing impairments, cerebral palsy, epilepsy, muscular 
dystrophy, multiple sclerosis, cancer, heart disease, diabetes, mental 
retardation, emotional illness and drug addiction and alcoholism.
    (ii) Major life activities means functions such as caring for one's 
self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (iii) Has a record of such an impairment means has a story of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more major life activities.
    (iv) Is regarded as having an impairment means (A) has a physical or 
mental impairment that does not substantially limit major life 
activities but that is treated by a recipient as constituting such a 
limitation; (B) has a physical or mental impairment that substantially 
limits major life activities only as a result of the attitudes of others 
toward such impairments, or (C) has none of the impairments defined in 
paragraph (j)(2)(i) of this section but is treated by a recipient as 
having such an impairment.
    (k) Qualified handicapped person means:
    (1) With respect to employment, a handicapped person who, with 
reasonable accommodation, can perform the essential functions of the job 
in question;
    (2) With respect to public pre-school, elementary, secondary, or 
adult educational services, a handicapped person, (i) of an age during 
which nonhandicapped persons are provided such services, (ii) of any age 
during which it is mandatory under State law to provide such services to 
handicapped persons, or (iii) to whom a State is required to provide a 
free appropriate public education under section 612 of the Education of 
the Handicapped Act; and
    (3) With respect to postsecondary and vocational education services, 
a handicapped person who meets the academic and technical standard 
requisite to admission or participation in the recipient's education 
program or activity;
    (4) With respect to other services, a handicapped person who meets 
the essential eligibility requirements for the recipient of such 
services.
    (l) Handicap means any conditions or characteristic that renders a 
person a handicapped person as defined in paragraph (j) of this section.



Sec. 142.4  Discrimination prohibited.

    (a) General. No qualified handicapped person shall on the basis of 
handicap, be excluded from participation in, be denied the benefits of, 
or otherwise be subjected to discrimination under any program or 
activity which receives or benefits from Federal financial assistance.
    (b) Discriminatory actions prohibited. (1) A recipient, in providing 
any aid, benefit, or service, may not, directly or through contractual, 
licensing, or other arrangements, on the basis of handicap:
    (i) Deny a qualified handicapped person the opportunity to 
participate in or benefit from the aid, benefit or service;
    (ii) Afford a qualified handicapped person an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified handicapped person with aid, benefit, or 
service that is not as effective in affording equal opportunity to 
obtain the same result, to gain the same benefit, or to reach the same 
level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits, or services to 
handicapped persons or to any class of handicapped person unless such 
action is necessary to provide qualified handicapped persons with aid, 
benefits, or services that are as effective as those provided to others;
    (v) Aid or perpetuate discrimination against a qualified handicapped 
person by providing significant assistance to any agency, organization, 
or person that discriminates on the basis of handicap in providing any 
aid, benefit, or service to beneficiaries of the recipients program;
    (vi) Deny a qualified handicapped person the opportunity to 
participate as a member of planning or advisory boards; or

[[Page 491]]

    (vii) Otherwise limit a qualified handicapped person in the 
enjoyment of any right, privilege, advantage, or opportunity enjoyed by 
others receiving an aid, benefit, or service.
    (2) For purposes of this part, aids, benefits, and services to be 
effective, are not required to produce identical result or level of 
achievement for handicapped and nonhandicapped persons, but must afford 
handicapped person equal opportunity to obtain the same result, to gain 
the same benefit, or to reach the same level of achievement, in the most 
integrated setting appropriate to the person's needs.
    (3) Despite the existence of separate or different programs or 
activities provided in accordance with this part, a recipient may not 
deny a qualified handicapped person the opportunity to participate in 
such programs or activities that are not separate or different.
    (4) A recipient may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration (i) that 
have the effect of subjecting qualified handicapped persons to 
discrimination on the basis of handicap, (ii) that have the purpose or 
effect of defeating or substantially impairing accomplishment of the 
objectives of the recipient's program with respect to handicapped 
persons, or (iii) that perpetuate the discrimination with respect to 
another recipient if both recipients are subject to common 
administrative control or are agencies of the same State.
    (5) In determining the site or location or a facility, an applicant 
for assistance or a recipient may not make selections (i) that have the 
effect of excluding handicapped persons from, denying them the benefits 
of, or otherwise subjecting them to discrimination under any program or 
activity that receives or benefits from Federal financial assistance of 
(ii) that have the purpose or effect of defeating or substantially 
impairing the accomplishment of the objectives of the program or 
activity with respect to handicapped persons.
    (6) As used in this section, the aid, benefit, or service provided 
under a program or activity receiving or benefiting from Federal 
financial assistance includes any aid, benefit, or service provided in 
or through a facility that has been constructed, expanded, altered, 
leased or rented, or otherwise acquired, in whole or in part with 
Federal financial assistance.
    (c) Programs limited by Federal law. The exclusion of a handicapped 
person from the benefits or a program limited by Federal statute or 
executive order to a different class of handicapped persons is not 
prohibited by this part.
    (d) Recipients shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified handicapped 
persons.
    (e) Recipients shall ensure that communications with their 
applicants, employees, and handicapped persons participating in their 
programs and activities, or receiving aids, or benefits of services, are 
available to persons with impaired vision and hearing in appropriate 
modes, including braille, enlarged type, sign language and 
telecommunication devices for the deaf.



Sec. 142.5  Assurances required.

    (a) Assurances. An applicant for Federal financial assistance for a 
program or activity to which this part applies shall submit an assurance 
on a form specified by the Secretary, that the program will be operated 
in compliance with this part. An applicant may incorporate these 
assurances by reference in subsequent applications to the Department.
    (b) Duration of obligations. (1) In the case of Federal financial 
assistance extended in the form of real property or to provide real 
property or structures on the property, the assurance will obligate the 
recipient or, in the case of a subsequent transfer, the transferee, for 
the period during which the real property or structures are used for the 
purposes for which Federal financial assistance is extended or for 
another purpose involving the provision of similar services or benefits.
    (2) Where no transfer of property is involved but property is 
purchased or improved with Federal financial assistance, the recipient 
shall agree to include the covenant described in paragraph (c)(1) of 
this section in the instrument effecting or recording any subsequent 
transfer of the property.

[[Page 492]]

    (3) Where Federal financial assistance is provided by the Department 
in the form of real property or interest in real property, the covenant 
shall also include a condition coupled with a right to be reserved by 
the Department to revert title to the property in the event of a breach 
of the covenant. If a transferee of real property proposes to mortgage 
or otherwise encumber the real property as security for financing 
construction of new, or improvement of existing facilities on the 
property for the purposes for which the property was transferred, the 
Secretary may, upon request of the transferee and if necessary to 
accomplish such financing and upon such conditions as the Secretary 
deems appropriate, agree to forbear the exercise of such right to revert 
title for so long as the lien of such mortgage or other encumbrance 
remains effective.



Sec. 142.6  Remedial action, voluntary action, and self-evaluation.

    (a) Remedial action. (1) If the Secretary finds that a recipient has 
discriminated against persons on the basis of handicap in violation of 
section 504 of the Act or this part, the recipient shall take such 
remedial action as the Secretary deems necessary to overcome the effects 
of the discrimination.
    (2) Where a recipient is found to have discriminated against persons 
on the basis of handicap in violation of section 504 of the Act or this 
part and where another recipient exercises control over the recipient 
that has discriminated, the Secretary, where appropriate, may require 
either or both recipients to take remedial action.
    (3) The Secretary may, where necessary to overcome the effects of 
discrimination in violation of section 504 of the Act or this part, 
require a recipient to take action (i) with respect to handicapped 
persons who are no longer participants in the recipient's program but 
who were participants in the program when such discrimination occurred, 
or (ii), with respect to handicapped persons who would have been 
participants in the program had the discrimination not occurred.
    (b) Voluntary action. A recipient may take steps, in addition to any 
action required by this part, to overcome the effects of conditions that 
resulted in limited participation in the recipient's program or activity 
by qualified handicapped persons.
    (c) Self-evaluation. (1) A recipient shall, within six months of the 
effective date of this part:
    (i) Evaluate, with the assistance of interested persons, including 
handicapped persons or organizations representing handicapped persons, 
its current policies and practices and the effects thereof that do not 
or may not meet the requirements of this part;
    (ii) Modify, after consultation with interested persons, including 
handicapped persons or organizations representing handicapped persons, 
any policies and practices that do not meet the requirements of this 
part; and
    (iii) Take, after consultation with interested persons, including 
handicapped persons or organizations representing handicapped persons, 
appropriate remedial steps to eliminate the effects of any 
discrimination that resulted from adherence to these policies and 
practices.
    (2) A recipient shall, for at least three years following completion 
of the evaluation required under paragraph (c)(1) of this section, 
maintain on file, make available for public inspection, and provide to 
the Secretary upon request: (i) A list of the interested persons 
consulted, (ii) a description of areas examined and any problems 
identified, and (iii) a description of any modifications made and of any 
remedial steps taken.



Sec. 142.7  Designation of responsible employee and adoption of grievance procedures.

    (a) Designation of responsible employee. A recipient that employs 15 
or more persons shall designate at least one person to coordinate its 
efforts to comply with this part.
    (b) Adoption of grievance procedures. A recipient that employs 15 or 
more persons shall adopt grievance procedures that incorporate 
appropriate due process for the prompt and equitable resolution of 
complaints alleging any action prohibited by this part.

[[Page 493]]



Sec. 142.8  Notice.

    (a) A recipient shall take appropriate initial and continuing steps 
to notify participants, beneficiaries, applicants, and employees, 
including those with impaired vision or hearing, and unions or 
professional organizations holding collective bargaining or professional 
agreements with the recipient that it does not discriminate on the basis 
of handicap in violation of section 504 of the Act or this part. The 
notification shall state, where appropriate, that the recipient does not 
discriminate in admission or access to, or treatment or employment in, 
its programs and activities. The notification shall also include an 
identification of the responsible employee designated pursuant to 
Sec. 142.7(a). A recipient shall make the initial notification required 
by this paragraph within 90 days of the effective date of this part. 
Methods of initial and continuing notification may include but are not 
limited to the posting of notices, publication in newspapers and 
magazines, placement of notices in recipients' publications, 
distribution of memoranda or other written communications; and with 
persons with impaired vision and hearing, through appropriate modes 
including braille, enlarged type, sign language, and telecommunication 
devices for the deaf.
    (b) If a recipient publishes or uses recruitment materials or 
publications containing general information that it makes available to 
participants, beneficiaries, applicants or employees, it shall include 
in those materials or publications a statement of the policy described 
in paragraph (a) of this section. A recipient may meet the requirement 
of the paragraph either by including appropriate inserts in existing 
materials and publications or by revising and reprinting the materials 
and publications.



Sec. 142.9  Administrative requirements for small recipients.

    The Secretary may require any recipient with fewer than fifteen 
employees, or any class of such recipients, to comply with Sec. 142.7, 
in whole or in part, when the Secretary finds a violation of this part 
or finds that such compliance will not significantly impair the ability 
of the recipient or class of recipients to provide benefits or services.



Sec. 142.10  Effect of State or local law or other requirements and effect of employment opportunities.

    (a) The obligation to comply with this part is not obviated or 
alleviated by the existence of any State or local law or other 
requirement that, on the basis of handicap, imposes prohibitions or 
limits upon the eligibility of qualified handicapped persons to receive 
services or to practice any occupation or profession.
    (b) The obligation to comply with this part is not obviated or 
alleviated because employment opportunities in any occupation or 
profession are or may be more limited for handicapped persons than for 
nonhandicapped persons.



                     Subpart B--Employment Practices



Sec. 142.11  Discrimination prohibited.

    (a) General. (1) No qualified handicapped person shall, on the basis 
of handicap, be subjected to discrimination in employment under any 
program or activity receiving Federal financial assistance.
    (2) A recipient shall make all decisions concerning employment under 
any program or activity to which this part applies in a manner which 
ensures that discrimination on the basis of handicap does not occur and 
may not limit, segregate, or classify applicants or employees in any way 
that adversely affects their opportunities or status because of 
handicap.
    (3) A recipient may not participate in a contractual or other 
relationship that has the effect of subjecting qualified handicapped 
applicants or employees to discrimination prohibited by this subpart. 
This includes relationships with employment and referral agencies, with 
labor unions, with organizations providing or administering fringe 
benefits to employees of the recipient, and with organizations providing 
training and apprenticeship programs.
    (b) Specific activities. The provisions of this part apply to:

[[Page 494]]

    (1) Recruitment, advertising, and the processing of applications for 
employment;
    (2) Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right to return from layoff, and 
rehiring;
    (3) Rates of pay or any other form of compensation and changes in 
compensation;
    (4) Job assignments, job classification, organizational structures, 
position descriptions, lines of progression, and seniority lists;
    (5) Leaves of absence, sick leave, or any other leave;
    (6) Fringe benefits available by virtue of employment whether or not 
administered by the recipient;
    (7) Selection and financial support for training, including 
apprenticeship, professional meetings, conferences and other related 
activities, and selection for leaves of absence to pursue training;
    (8) Employer sponsored activities, including social or recreational 
programs; and
    (9) Any other condition, or privilege of employment.
    (c) A recipient's obligation to comply with this subpart is not 
affected by any inconsistent term of any collective bargaining agreement 
to which it is a party.



Sec. 142.12  Reasonable accommodation.

    (a) A recipient shall make reasonable accommodation to the known 
physical or mental limitations of an otherwise qualified handicapped 
applicant or employee unless the recipient can demonstrate that the 
accommodation would impose an undue hardship on the operation of the 
program.
    (b) Reasonable accommodation may include: (1) Making facilities used 
by employees readily accessible to and usable by handicapped persons, 
and (2) job restructuring, part-time or modified work schedules, 
acquisition or modification of equipment or devices, the provision of 
readers or interpreters, and other similar actions.
    (c) In determining pursuant to paragraph (a) of this section whether 
an accommodation would impose an undue hardship on the operation of a 
recipient's program, factors to be considered include:
    (1) The overall size of the recipient's program with respect to 
number and type of facilities, and size of budget;
    (2) Job restructuring, part-time or modified work schedules, 
acquisition and or modification of equipment of devices such as 
telecommunication devices for the deaf, the provision of readers or 
interpreters and other similar actions including the use of braille, 
enlarged type, and sign language, when appropriate.
    (3) The nature and cost of the accommodation needed.
    (d) A recipient may not deny any employment opportunity to a 
qualified handicapped employee or applicant if the basis for the denial 
is the need to make reasonable accommodation to the physical or mental 
limitations of the employee or applicant.



Sec. 142.13  Employment criteria.

    (a) A recipient may not make use of any employment test or other 
selection criterion that screens out or tends to screen out handicapped 
persons or any class of handicapped persons unless:
    (1) The test score or other selection criterion, as used by the 
recipient, is shown to be job-related for the position in question, and
    (2) Alternative job-related tests or criteria that do not screen out 
or tend to screen out as many handicapped persons are not shown by the 
Secretary to be available.
    (b) A recipient shall select and administer tests concerning 
employment to ensure that when administered to any applicant or employee 
who has a handicap that impairs sensory, manual, speaking, or other 
skills, the test results accurately reflect the applicant's or 
employee's job skills, aptitude, or whatever factor the test purports to 
measure, rather then reflecting the applicant's impaired sensory, 
manual, speaking, or other skills (except where those skills are the 
factors that the test purports to measure).



Sec. 142.14  Preemployment inquiries.

    (a) Except as provided in paragraphs (b) and (c) of this section, a 
recipient may not conduct a preemployment medical examination or may not 
make

[[Page 495]]

preemployment inquiry of an applicant as to whether the applicant is a 
handicapped person or as to the nature or severity of a handicap. A 
recipient may, however, make preemployment inquiry into an applicant's 
ability to perform job-related functions.
    (b) When a recipient is taking remedial action to correct the 
effects of past discrimination pursuant to Sec. 142.6(a), when a 
recipient is taking voluntary action to overcome the effect of 
conditions that resulted in limited participation in its federally 
assisted program or activity pursuant to Sec. 142.6(b), or when a 
recipient is taking affirmative action pursuant to section 503 of the 
Act, the recipient may invite applicants for employment to indicate 
whether and to what extent they are handicapped: Provided, That:
    (1) The recipient states clearly on any written questionnaire used 
for this purpose or makes clear orally, if no written questionnaire is 
used, that the information requested is intended for use solely in 
connection with its remedial action obligations or its voluntary or 
affirmative action efforts; and
    (2) The recipient states clearly that the information is being 
requested on a voluntary basis, that it will be kept confidential as 
provided in paragraph (d) of this section, that refusal to provide it 
will not subject the applicant or employee to any adverse treatment, and 
that is will be used only in accordance with this part.
    (c) Nothing in this section shall prohibit a recipient from 
conditioning an offer of employment on the results of a medical 
examination conducted prior to the employee's entrance on duty. 
Provided, That: (1) All entering employees are subjected to such an 
examination regardless of handicap, and (2) the results of such an 
examination are used only in accordance with the requirement of this 
part.
    (d) Information obtained in accordance with this section as to the 
medical condition or history of the applicant shall be collected and 
maintained on separate forms that shall be accorded confidentiality as 
medical records except that:
    (1) Supervisors and managers may be informed regarding restrictions 
on the work or duties of handicapped persons and regarding necessary 
accommodation;
    (2) First aid and safety personnel may be informed, where 
appropriate, if the condition might require emergency treatment; and
    (3) Government officials investigating compliance with the Act shall 
be provided relevant information upon request.



                    Subpart C--Program Accessibility



Sec. 142.15  Discrimination prohibited.

    No qualified handicapped person shall, because a recipient's 
facilities are inaccessible to or unusable by handicapped persons, be 
denied the benefits of, be excluded from participation in, or otherwise 
be subjected to discrimination under any program or activity to which 
the part applies.



Sec. 142.16  Existing facilities.

    (a) Program accessibility. A recipient shall operate each program or 
activity to which this part applies so that the program or activity when 
viewed in its entirety is readily accessible to and usable by 
handicapped persons. This paragraph does not require a recipient to make 
each of its existing facilities or every part of an existing facility 
accessible to and usable by handicapped persons.
    (b) Methods. A recipient may comply with the requirement of 
paragraph (a) of this section through such means as the addition of 
equipment (e.g., telecommunication device for the deaf) redesign of 
equipment, reassignment of classes or other services to accessible 
buildings, assignment of aides to beneficiaries, home visits, delivery 
of health, welfare, or other social services at alternate accessible 
sites, alteration of existing facilities and construction of new 
facilities in conformance with the requirement of Sec. 142.18, or any 
other method that results in making its program or activity accessible 
to handicapped persons. A recipient is not required to make structural 
changes in existing facilities where other methods are effective in 
achieving compliance with paragraph (a) of this section. In choosing 
among available methods for meeting the requirement of paragraph (a) of 
this section, a recipient shall

[[Page 496]]

give priority to those methods that offer programs and activities to 
handicapped persons in the most integrated setting appropriate.
    (c) Time period. A recipient shall comply with the requirement of 
paragraph (a) of this section within 60 days of the effective date of 
this part except that where structural changes in facilities are 
necessary, such changes shall be made within three years of the 
effective date of this part, but in any event as expeditiously as 
possible.
    (d) Transition plan. In the event that structural changes to 
facilities are necessary to meet the requirement of paragraph (a) of 
this section, a recipient shall develop, within six months of the 
effective date of this part, a transition plan setting forth the steps 
necessary to complete such changes. The plan shall be developed with the 
assistance of interested persons, including handicapped persons or 
organizations representing handicapped persons. A copy of the transition 
plan shall be made available for public inspection. The plan shall, at a 
minimum:
    (1) Identify physical obstacles in the recipient's facilities that 
limit the accessibility of its program or activity to handicapped 
persons;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
full program accessibility and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period;
    (4) Indicate the person responsible for implementation of the plan; 
and
    (5) A list of all handicapped persons and organizations consulted in 
the plan formulation process.
    (e) Notice. The recipient shall adopt and implement procedures to 
ensure that interested persons, including persons with impaired vision 
or hearing, can obtain information as to the existence and location of 
services, activities, and facilities that are accessible to and usable 
by handicapped persons.



Sec. 142.17  New construction.

    (a) Design and construction. Each facility or part of a facility 
constructed by, on behalf of, or for the use of a recipient shall be 
designed, constructed, and operated in a manner so that the facility or 
part of the facility is accessible to and usable by persons with 
handicaps, if the construction was commenced after the effective date of 
this part.
    (b) Alteration. Each facility or part of a facility which is altered 
by, on behalf of, or for the use of a recipient after the effective date 
of this part in a manner that effects or could affect the usability of 
the facility or part of the facility shall, to the maximum extent 
feasible, be altered so that the altered portion of the facility is 
readily accessible to and usable by persons with handicaps.
    (c) Conformance with Uniform Federal Accessibility Standards. (1) 
Effective as of January 18, 1991, design, construction, or alteration of 
buildings in conformance with sections 3-8 of the Uniform Federal 
Accessibility Standards (USAF) (appendix A to 41 CFR subpart 101-19.6) 
shall be deemed to comply with the requirements of this section with 
respect to those buildings. Departures from particular technical and 
scoping requirements of UFAS by the use of other methods are permitted 
where substantially equivalent or greater access to and usability of the 
building is provided.
    (2) For purposes of this section, section 4.1.6(1)(g) of UFAS shall 
be interpreted to exempt from the requirements of UFAS only mechanical 
rooms and other spaces that, because of their intended use, will not 
require accessibility to the public or beneficiaries or result in the 
employment or residence therein of persons with physical handicaps.
    (3) This section does not require recipients to make building 
alterations that have little likelihood of being accomplished without 
removing or altering a load-bearing structural member.
[55 FR 52138, 52140, Dec. 19, 1990]

[[Page 497]]



Secs. 142.18--142.40  [Reserved]



                   Subpart D--Postsecondary Education



Sec. 142.41  Application of this subpart.

    Subpart D applies to postsecondary education programs and 
activities, including postsecondary vocational education programs and 
activities, that receive or benefit from Federal financial assistance 
from the Department of State, and to recipients that operate, or that 
receive or benefit from Federal financial assistance for the operation 
of, such programs or activities.



Sec. 142.42  Admissions and recruitment.

    (a) General. Qualified handicapped persons may not, on the basis of 
handicap, be denied admission or be subjected to discrimination in 
admission or recruitment by a recipient to which this subpart applies.
    (b) Admissions. In administering its admission policies, a recipient 
to which this subpart applies:
    (1) May not apply limitations upon the number or proportion of 
handicapped persons who may be admitted;
    (2) May not make use of any test or criterion for admission that has 
a disproportionate, adverse effect on handicapped persons or any class 
of handicapped persons unless (i) the test or criterion, as used by the 
recipient, has been validated as a predictor of success in the education 
program of activity in question and (ii) alternate tests or criteria 
that have a less disproportionate, adverse effect are not shown by the 
Secretary to be available;
    (3) Shall assure itself that (i) admissions tests are selected and 
administered so as to ensure that, when a test is administered to an 
applicant who has a handicap that impairs sensory, manual, or speaking 
skills, the test results accurately reflect the applicant's aptitude or 
achievement level or whatever other factor the test purports to measure, 
rather than reflecting the applicant's impaired sensory, manual, 
speaking or other skills (except where those skills are the factors that 
the test purports to measure); (ii) admissions tests that are designed 
for persons with impaired sensory, manual, speaking or other skills are 
offered as often and in as timely a manner as are other admissions 
tests; and (iii) admissions tests are administered in facilities that, 
are accessible to handicapped persons; and
    (4) Except as provided in paragraph (c) of this section, may not 
make preadmission inquiry as to whether an applicant for admission is a 
handicapped person but, after admission, may make inquiries on a 
confidential basis as to handicaps that may require accommodation.
    (c) Preadmission inquiry exception. When a recipient is taking 
remedial action to correct the effects of past discrimination pursuant 
to Sec. 142.6(a) or when a recipient is taking voluntary action to 
overcome the effects of conditions that resulted in limited 
participation in its federally assisted program or activity pursuant to 
Sec. 142.6(b), the recipient may invite applicants for admissions to 
indicate whether and to what extent they are handicapped; Provided, 
That: (1) The recipient states clearly on any written questionnaire used 
for this purpose or makes clear orally if no written questionnaire is 
used that the information requested is intended for use solely in 
connection with its remedial action obligations or its voluntary action 
efforts; and
    (2) The recipient states clearly that the information is being 
requested on a voluntary basis, that it will be kept confidential, that 
refusal to provide it will not subject the applicant to any adverse 
treatment, and that it will be used only in accordance with this part.
    (d) Validity studies. For the purpose of paragraph (c)(2) of this 
section, a recipient may base prediction equations on first year grades, 
but shall conduct periodic validity studies against the criterion of 
overall success in the education program or activity in question in 
order to monitor the general validity of the test scores.



Sec. 142.43  Treatment of students; general.

    (a) No qualified handicapped student shall, on the basis of 
handicap, be excluded from participation in, be denied

[[Page 498]]

the benefits of, or otherwise be subjected to discrimination under any 
academic, research, occupational, training, housing, health, insurance, 
counseling, financial aid, physical education, athletics, recreation, 
transportation, other extracurricular, or other postsecondary education 
program or activity to which this subpart applies.
    (b) A recipient to which this subpart applies that considers 
participation by students in education programs activities not operated 
wholly by the recipient as part of, or equivalent to, an education 
program or activity operated by the recipient shall assure itself that 
the other education program or activity, as a whole, provides an equal 
opportunity for the participation of qualified handicapped persons.
    (c) A recipient to which this subpart applies may not, on the basis 
of handicap, exclude any qualified handicapped student from any course, 
course of study, or other part of its education program or activity.
    (d) A recipient to which this subpart applies shall operate its 
programs and activities in the most integrated setting appropriate.



Sec. 142.44  Academic adjustments.

    (a) Academic requirements. A recipient to which this subpart applies 
shall make such modifications to its academic requirements as are 
necessary to ensure that such requirements do not discriminate or have 
the effect of discrimination, on the basis of handicap, against a 
qualified handicapped applicant or student. Academic requirements that 
the recipient can demonstrate are essential to the program of 
instruction being pursued by such student or to any directly related 
licensing requirement will not be regarded as discriminatory within the 
meaning of this section. Modifications may include changes in the length 
of time permitted for the completion of degree requirements, 
substitution of specific courses required for the completion of degree 
requirements, and adaptation of the manner in which specific courses are 
conducted.
    (b) Other rules. A recipient to which this subpart applies may not 
impose upon handicapped students other rules, such as the prohibition of 
tape recorders in classrooms or of dog guides in campus buildings, that 
have the effect of limiting the participation of handicapped students in 
the recipient's education program or activity.
    (c) Course examinations. In its examinations or other procedures for 
evaluating students' academic achievement in its program, a recipient to 
which this subpart applies shall provide such methods for evaluating the 
achievement of students who have a handicap that impairs sensory, 
manual, speaking or other skills as will best ensure that the results of 
the evaluation represent the student's achievement in the course, rather 
than reflecting the student's impaired sensory, manual, speaking or 
other skills (except where such skills are the factors that the test 
purports to measure).
    (d) Auxiliary aids. (1) A recipient to which this subpart applies 
shall take such steps as are necessary to ensure that no handicapped 
student is denied the benefits of, excluded from participation in, or 
otherwise subjected to discrimination under the education program or 
activity operated by the recipient because of the absence of educational 
auxiliary aids for students with impaired sensory, manual, speaking or 
other skills.
    (2) Auxiliary aids may include taped texts, interpreters, 
telecommunication devices for the deaf or other effective methods of 
making orally delivered materials available to students with hearing 
impairments, readers in libraries for students with visual impairments, 
classroom equipment adapted for use by students with manual impairments, 
and other similar services and actions. Recipients need not provide 
attendants, individually prescribed devices, readers for personal use or 
study, or other devices or services of a personal nature.



Sec. 142.45  Housing.

    (a) Housing provided by the recipient. A recipient that provides 
housing to its nonhandicapped students shall provide comparable, 
convenient, and accessible housing to handicapped students at the same 
cost as to others. At the end of the transition period provided for in 
subpart C of this part, such housing shall be available in sufficient 
quantity

[[Page 499]]

and variety so that the scope of handicapped students' choice of living 
accommodation is, as a whole, comparable to that of nonhandicapped 
students.
    (b) Other housing. A recipient that assists any agency, 
organization, or person in making housing available to any of its 
students shall take such action as may be necessary to assure itself 
that such housing is, as a whole, made available in a manner that does 
not result in discrimination on the basis of handicap.



Sec. 142.46  Financial and employment assistance to students.

    (a) Provisions of financial assistance. (1) In providing financial 
assistance of qualified handicapped persons, a recipient to which this 
subpart applies may not:
    (i) On the basis of handicap, provide less assistance than is 
provided to nonhandicapped persons, limit eligibility for assistance, or 
otherwise discriminate; or
    (ii) Assist any entity or person that provides assistance to any of 
the recipient's students in a manner that discriminates against 
qualified handicapped persons on the basis of handicap.
    (2) A recipient may administer or assist in the administration of 
scholarships, fellowships, or other forms of financial assistance 
established under wills, trusts, bequests, or similar legal instruments 
that require awards to be made on the basis of factors that discriminate 
or have the effect of discriminating on the basis of handicap only if 
the overall effect of the award of scholarships, fellowships, and other 
forms of financial assistance is not discriminatory on the basis of 
handicap.
    (b) Assistance in making available outside employment. A recipient 
that assists any agency, organization, or person in providing employment 
opportunities to any of its students shall assure itself that such 
employment opportunities, as a whole, are made available in a manner 
that would not violate subpart B if they were provided by the recipient.
    (c) Employment of students by recipients. A recipient that employs 
any of its students may not do so in a manner that violates subpart B.



Sec. 142.47  Non-academic services.

    (a) Physical education and athletics. (1) In providing physical 
education courses, athletics and similar programs and activities to any 
of its students, a recipient to which this subpart applies may not 
discriminate on the basis of handicap. A recipient that offers physical 
education courses or that operates or sponsors intercollegiate, club, or 
intramural athletics shall provide to qualified handicapped students an 
equal opportunity for participation in these activities.
    (2) A recipient may offer to handicapped students physical education 
and athletic activities that are separate or different only if separate 
or differentiation is consistent with the requirements of Sec. 142.43(d) 
and only if no qualified handicapped student is denied the opportunity 
to compete for teams or to participate in courses that are not separate 
or different.
    (b) Counseling and placement services. A recipient to which this 
subpart applies that provides personal, academic or vocational 
counseling, guidance, or placement services to its students shall 
provide these services without discrimination on the basis of handicap. 
The recipient shall ensure that qualified handicapped students are not 
counseled toward more restrictive career objectives than are 
nonhandicapped students with similar interests and abilities. This 
requirement does not preclude a recipient from providing factural 
information about licensing and certification requirements that may 
present obstacles to handicapped persons in their pursuit of particular 
careers.
    (c) Social organizations. A recipient that provides significant 
asssistance to fraternities, sororities, or similar organizations shall 
assure itself that the membership practices of such organizations do not 
permit discrimination otherwise prohibited by this subpart.

[[Page 500]]



Secs. 142.48--142.60  [Reserved]



         Subpart E--Health, Welfare, Social, and Other Services



Sec. 142.61  Application of this subpart.

    Subpart E applies to health, welfare, social and other programs and 
activities that receive or benefit from Federal financial assistance and 
to recipients that operate, or that receive or benefit from Federal 
financial assistance for the operation of such programs or activities.



Sec. 142.62  Health, welfare, social, and other services.

    (a) General. In providing health, welfare, social and other services 
or benefits, a recipient may not, on the basis of handicap:
    (1) Deny a qualified handicapped person these benefits or services;
    (2) Afford a qualified handicapped person an opportunity to receive 
benefits or services that are not equal to those offered nonhandicapped 
persons;
    (3) Provide a qualified handicapped person with benefits or services 
that are not as effective (as defined in Sec. 142.4(b)) as the benefits 
or services provided to others;
    (4) Provide benefits or services in a manner that limits or has the 
effect of limiting the participation of qualified handicapped persons; 
or
    (5) Provide different or separate benefits or services to 
handicapped persons except where necessary to provide qualified 
handicapped persons with benefits and services that are as effective as 
those provided to others.
    (b) Notice. A recipient that provides notice concerning benefits or 
services or written material concerning waivers of rights or consent to 
treatment shall take such steps as are necessary to ensure that 
qualified handicapped persons, including those with impaired sensory or 
speaking skills, are not denied effective notice because of their 
handicap.
    (c) Emergency treatment for the hearing impaired. A recipient 
hospital that provides health services or benefits shall establish a 
procedure for effective communication with persons with impaired hearing 
for the purpose of providing emergency health care.
    (d) Auxiliary aids. (1) A recipient to which this subpart applies 
that employs 15 or more persons shall provide appropriate auxiliary aids 
to persons with impaired sensory, manual, speaking or other skills 
(where necessary) to afford such persons an equal opportunity to benefit 
from the service in question.
    (2) The Secretary may require recipients with fewer than 15 
employees to provide auxiliary aids where the provision of aids would 
not significantly impair the ability of the recipient to provide its 
benefits or services.
    (e) For the purpose of this paragraph, auxiliary aids may include 
brailled and taped material, interpreters, and other aids for persons 
with impaired hearing or vision.



Sec. 142.63  Drug and alcohol addicts.

    A recipient to which this subpart applies that operates a general 
hospital or outpatient facility may not discriminate in admission or 
treatment against a drug or alcohol abuser or alcoholic who is suffering 
from a medical condition, because of the person's drug or alcohol abuse 
or alcoholism.



                          Subpart F--Procedures



Sec. 142.70  Procedures.

    The procedural provisions applicable to title VI of the Civil Rights 
Act of 1964 apply to this part. These procedures are found in 22 CFR 
subchapter O, part 141.

Appendix A to Part 142--Grants and Activities to Which This Part Applies

    Programs of Financial Assistance Administered by the Department of 
State Subject to Handicap Discrimination Regulations.
    1. Resettlement of Refugees in the United States Under the Migration 
and Refugee Assistance Act of 1962, as amended (22 U.S.C. 2601 et seq. 
(1976)).
    2. Non-reimbursable assignment of Foreign Service officers to State 
or local governments, public schools, community colleges, and other 
public or private nonprofit organizations designated by the Secretary of 
State (section 576 of the Foreign Service Act of 1946, as amended; 22 
U.S.C. 966 (1976)).
    3. Diplomat-in-Residence Program of the Foreign Service Institute 
under Title VII of

[[Page 501]]

the Foreign Service Act of 1946, as amended (22 U.S.C. 1041, et seq. 
(1976)).



PART 143--NONDISCRIMINATION ON THE BASIS OF AGE IN PROGRAMS OR ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE--Table of Contents




                           Subpart A--General

Sec.
143.1  What is the purpose of age discrimination regulations?
143.2  To what programs do these regulations apply?
143.3  Definitions.

         Subpart B--Standards for Determining Age Discrimination

143.11  Standards.

                 Subpart C--Duties of Agency Recipients

143.21  General responsibilities.
143.22  Notice to subrecipients.
143.23  Self-evaluation.
143.24  Information requirements.

   Subpart D--Investigation, Conciliation, and Enforcement Procedures

143.31  Compliance reviews.
143.32  Complaints.
143.33  Mediation.
143.34  Investigation.
143.35  Prohibition against intimidation or retaliation.
143.36  Compliance procedure.
143.37  Hearings, decisions, post-termination proceedings.
143.38  Remedial action by recipient.
143.39  Alternate funds disbursal procedure.

Appendices A-C to Part 143--List of Affected Programs

    Authority:  Age Discrimination Act of 1975, as amended, 42 U.S.C. 
5101 et seq.; 45 CFR 90; 22 U.S.C. 2658.

    Source:  45 FR 31713, May 14, 1980, unless otherwise noted.



                           Subpart A--General



Sec. 143.1  What is the purpose of the age discrimination regulations?

    The purpose of these regulations is to set out the policies and 
procedures for the three foreign affairs agencies (State, USICA and AID) 
under the Age Discrimination Act of 1975 and the government-wide age 
discrimination regulations at 45 CFR part 90 (published at 44 FR 33768, 
June 12, 1979). The Act and the government-wide regulations prohibit 
discrimination on the basis of age in programs or activities in the 
United States receiving federal financial assistance. The Act and the 
government-wide regulations permit federally assisted programs and 
activities, and recipients of federal funds, to continue to use age 
distinctions and factors other than age which meet the requirements of 
the Act and the government-wide regulations.



Sec. 143.2  To what programs do these regulations apply?

    These regulations apply to each foreign affairs agency recipient and 
to each program or activity in the United States operated by the 
recipient which receives or benefits from federal financial assistance 
provided by any of these agencies.



Sec. 143.3  Definitions.

    (a) The following terms used in this part are defined in the 
government-wide regulations (45 CFR 90.4, 44 FR 33768):

    Act
    Action
    Age
    Age distinction
    Age-related term
    Federal financial assistance
    Recipient (including subrecipients)
    United States

    (b) As used in this part:
    (1) Agency means the Department of State, the U.S. International 
Communication Agency, and the Agency for International Development.
    (2) Secretary means the Secretary of State, the Director of the U.S. 
International Communication Agency, and the Administrator of the Agency 
for International Development, or the designee of such officer.
    (3) Subrecipient means any of the entities in the definition of 
``recipient'' to which a recipient extends or passes on Federal 
financial assistance. A subrecipient is generally regarded as a 
recipient of Federal financial assistance and has all the duties of a 
recipient in these regulations.

[[Page 502]]



         Subpart B--Standards for Determining Age Discrimination



Sec. 143.11  Standards.

    The standards each agency uses to determine whether an age 
distinction or age-related term is prohibited are set out in part 90 
(primarily subpart B) of 45 CFR.



                 Subpart C--Duties of Agency Recipients



Sec. 143.21  General responsibilities.

    Each agency recipient has primary responsibility to ensure that its 
programs and activities are in compliance with the Act, the government-
wide regulations, and these regulations.



Sec. 143.22  Notice to subrecipients.

    Where a recipient passes on Federal financial assistance from an 
agency to subrecipients, the recipient shall provide the subrecipients 
written notice to their obligations under these regulations.



Sec. 143.23  Self-evaluation.

    (a) Each recipient employing the equivalent of 15 or more full-time 
employees shall complete a one-time written self-evaluation of its 
compliance under the Act within 18 months of the effective date of these 
regulations.
    (b) In its self-evaluation each recipient shall identify each age 
distinction it uses and justify each age distinction it imposes on the 
program or activity receiving Federal financial assistance from an 
agency.
    (c) Each recipient shall take corrective action whenever a self-
evaluation indicates a violation of these regulations.
    (d) Each recipient shall make the self-evaluation available on 
request to the agency and to the public for a period of three years 
following its completion.



Sec. 143.24  Information requirements.

    Each recipient shall:
    (a) Make available upon request to the agency information necessary 
to determine whether the recipient is complying with the regulations.
    (b) Permit reasonable access by the agency to the books, records, 
accounts, and other recipient facilities and sources of information to 
the extent necessary to determine whether a recipient is in compliance 
with these regulations.



   Subpart D--Investigation, Conciliation, and Enforcement Procedures



Sec. 143.31  Compliance reviews.

    (a) The agency may conduct compliance reviews and pre-award reviews 
of recipients that will permit it to investigate and correct violations 
of these regulations. The agency may conduct these reviews even in the 
absence of a complaint against a recipient. The review may be as 
comprehensive as necessary to determine whether a violation of these 
regulations has occurred.
    (b) If a compliance review or pre-award review indicates a violation 
of this part, the agency will attempt to achieve voluntary compliance 
with the Act. If voluntary compliance cannot be achieved, the agency 
will arrange for enforcement as described in Sec. 143.36.



Sec. 143.32  Complaints.

    (a) Any person, individually or as a member of a class or on behalf 
of others, may file a complaint with an agency, alleging discrimination 
prohibited by these regulations based on an action occurring on or after 
July 1, 1979. A complainant shall file a complaint within 180 days from 
the date the complainant first had knowledge of the alleged act of 
discrimination. However, for good cause shown, the agency may extend 
this time limit.
    (b) The agency will attempt to facilitate the filing of complaints 
wherever possible, including taking the following measures:
    (1) Accepting as a sufficient complaint, any written statement which 
identifies the parties involved, describes generally the action or 
practice complained of, and is signed by the complainant.
    (2) Freely permitting a complainant to add information to the 
complaint to meet the requirements of a sufficient complaint.

[[Page 503]]

    (3) Widely disseminating information regarding the obligations of 
recipients under the Act and these regulations.
    (4) Notifying the complainant and the recipient of their rights 
under the complaint procedure, including the right to have a 
representative at all stages of the complaint process.
    (5) Notifying the complainant and the recipient (or their 
representatives) of their right to contact the agency for information 
and assistance regarding the complaint resolution process.
    (c) The agency will return to the complainant any complaint outside 
the jurisdiction of these regulations and will state the reason(s) why 
it is outside the jurisdiction of these regulations.



Sec. 143.33  Mediation.

    (a) Referral of complaints for mediation. The agency will refer to 
the Federal Mediation and Conciliation Service all complaints that:
    (1) Fall within the jurisdiction of these regulations; and
    (2) Contain all information necessary for further processing.
    (b) Both the complainant and the recipient shall participate in the 
mediation process to the extent necessary to reach an agreement or make 
an informed judgment that an agreement is not possible. There must be at 
least one meeting with the mediator, before the agency will accept a 
judgment that an agreement is not possible. However, the recipient and 
the complainant need not meet with the mediator at the same time.
    (c) If the complainant and the recipient reach an agreement, the 
mediator shall prepare a written statement of the agreement and have the 
complainant and recipient sign it. The mediator shall send a copy of the 
agreement to the agency. The agency shall take no further action on the 
complaint unless the complainant or the recipient fails to comply with 
the agreement.
    (d) The mediator shall protect the confidentiality of all 
information obtained in the course of the mediation process. No mediator 
shall testify in any adjudicative proceeding, produce any document, or 
otherwise disclose any information obtained in the course of the 
mediation process without prior approval of the head of the mediation 
agency.
    (e) The agency will use the mediation process for a maximum of 60 
days after receiving a complaint. Mediation ends if:
    (1) Sixty days elapse from the time the agency receives the 
complaint; or
    (2) Prior to the end of that 60-day period, an agreement is reached; 
or
    (3) Prior to the end of that 60-day period, the mediator determines 
that an agreement cannot be reached.
    (f) The mediator shall return unresolved complaints to the agency.



Sec. 143.34  Investigation.

    (a) Informal investigation. (1) The agency will investigate 
complaints that are unresolved after mediation or are reopened because 
of a violation of a mediation agreement.
    (2) As part of the initial investigation, the agency will use 
informal fact finding methods, including joint or separate discussions 
with the complainant and recipient to establish the facts, and, if 
possible, settle the complaint on terms that are mutually agreeable. The 
agency may seek the assistance of any involved State program agency.
    (3) The agency will put any agreement in writing and have it signed 
by the parties and an authorized official of the agency.
    (4) The settlement shall not affect the operation of any other 
enforcement efforts of the agency, including compliance reviews and 
other individual complaints which may involve the recipient.
    (5) The settlement is not a finding of discrimination against a 
recipient.
    (b) Formal investigation. If the agency cannot resolve the complaint 
through informal investigation, it will begin to develop formal findings 
through further investigation of the complaint. If the investigation 
indicates a violation of these regulations, the agency will attempt to 
obtain voluntary compliance. If the agency cannot obtain voluntary 
compliance, it will begin enforcement as described in Sec. 143.36.

[[Page 504]]



Sec. 143.35  Prohibition against intimidation or retaliation.

    A recipient may not engage in acts of intimidation or retaliation 
against any person who:
    (a) Attempts to assert a right protected by these regulations; or
    (b) Cooperates in any mediation, investigation, hearing, or other 
part of the agency's investigation, conciliation, and enforcement 
process.



Sec. 143.36  Compliance procedure.

    (a) An agency may enforce the Act and these regulations through:
    (1) Termination of a recipient's Federal financial assistance from 
the agency under the program or activity involved where the recipient 
has violated the Act and these regulations. The determination of the 
recipient's violation may be made only after a recipient has had an 
opportunity for a hearing on the record before an administrative law 
judge. Therefore, cases which are settled in mediation or prior to a 
hearing, will not involve termination of a recipient's Federal financial 
assistance from the agency.
    (2) Any other means authorized by law including but not limited to:
    (i) Referral to the Department of Justice for proceedings to enforce 
any rights of the United States or obligations by the Act and these 
regulations.
    (ii) Use of any requirement of or referral to any Federal, state, or 
local government agency which will have the effect of correcting a 
violation of the Act or these regulations.
    (b) The agency will limit any termination under Sec. 143.36(a)(1) to 
the particular recipient and particular program or activity the agency 
finds in violation of these regulations. The agency will not base any 
part of a termination on a finding with respect to any program or 
activity of the recipient which does not receive Federal financial 
assistance from the agency.
    (c) The agency will take no action under paragraph (a) of this 
section until:
    (1) The agency head has advised the recipient of its failure to 
comply with these regulations and has determined that voluntary 
compliance cannot be obtained.
    (2) Thirty days have lapsed after the agency head has sent a written 
report of the circumstances and grounds of the action to the committees 
of the Congress having legislative jurisdiction over the Federal program 
or activity involved. The agency head shall file a report whenever any 
action is taken under paragraph (a) of this section.
    (d) The agency head also may defer granting new Federal financial 
assistance from the agency to a recipient when a hearing under 
Sec. 143.36(a)(1) is initiated.
    (1) New Federal financial assistance from the agency includes all 
assistance for which the agency requires an application or approval, 
including renewal or continuation of existing activities, or 
authorization of the new activities, during the deferral period. New 
Federal financial assistance from the agency does not include increases 
in funding as a result of changed computation of formula awards or 
assistance approved prior to the beginning of a hearing under 
Sec. 143.36(a)(1).
    (2) The agency will not begin a deferral until the recipient has 
received a notice of opportunity for a hearing under Sec. 143.36(a)(1). 
The agency will not continue a deferral for more than 60 days unless a 
hearing has begun within that time or the time for beginning the hearing 
has been extended by mutual consent of the recipient and the agency 
head. The agency will not continue a deferral for more than 30 days 
after the close of a hearing unless the hearing results in a finding 
against the recipient.



Sec. 143.37  Hearings, decisions, post-termination proceedings.

    Certain procedural provisions applicable to Title VI of the Civil 
Rights Act of 1964 apply to enforcement of this part. They are 22 CFR 
141.8 through 141.10.



Sec. 143.38  Remedial action by recipient.

    Where the agency head finds a recipient has discriminated on the 
basis of age, the recipient shall take any remedial action that the 
agency head may require to overcome the effects of the discrimination. 
If another recipient exercises control over the recipient that has 
discriminated, the agency head

[[Page 505]]

may require both recipients to take remedial action.



Sec. 143.39  Alternate funds disbursal procedure.

    (a) When an agency withholds funds from a recipient under these 
regulations, the agency head may disburse the withheld funds directly to 
an alternate recipient, any public or non-profit private organization or 
agency, or State or political subdivision of the State.
    (b) The agency head will require any alternate recipient to 
demonstrate:
    (1) The ability to comply with these regulations; and
    (2) The ability to achieve the goals of the Federal statute 
authorizing the program or activity.

            Appendix A to Part 143--List of Affected Programs

Programs of Financial Assistance Administered by the Department of State 
                Subject to Age Discrimination Regulations

    Resettlement of Refugees in the United States Under the Migration 
and Refugee Assistant Act of 1962, as amended (22 U.S.C. 2601 et seq.).
    Diplomat in Residence Program of the Foreign Service Institute Under 
Title VII of the Foreign Service Act of 1946, as amended (22 U.S.C. 1041 
et seq.).
    Assignments under section 576 of the Foreign Service Act of 1946, as 
amended (22 U.S.C. 966)

            Appendix B to Part 143--List of Affected Programs

   Programs of Financial Assistance Administered by the United States 
    International Communication Agency Subject to Age Discrimination 
                               Regulations

    Educational and Cultural Exchanges under the Mutual Educational and 
Cultural Exchange Act of 1961, as amended (22 U.S.C. 1431-1479).

            Appendix C to Part 143--List of Affected Programs

   Program of Financial Assistance Administered by AID Subject to Age 
                       Discrimination Regulations

    1. Grants to research and educational institutions in the United 
States to strengthen their capacity to develop and carry out programs 
concerned with the economic and social development of developing 
countries (Section 122(d), Foreign Assistance Act of 1961, as amended, 
22 U.S.C. 2151(d)).
    2. Grants to land grant and other qualified agricultural 
universities and colleges in the United States to develop their 
capabilities to assist developing countries in agricultural teaching, 
research and extension services (Section 297, Foreign Assistance Act of 
1961, as amended, 22 U.S.C. 2220(b)).
    3. Grants to private and voluntary agencies, non-profit 
organizations, educational institutions, and other qualified 
organizations for programs in the United States to promote the economic 
and social development of developing countries (Sections 103-106, 
Foreign Assistance Act of 1961, as amended, 22 U.S.C. 2151a-2151d).



PART 144--ENFORCEMENT OF NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR ACTIVITIES CONDUCTED BY THE UNITED STATES DEPARTMENT OF STATE--Table of Contents




Sec.
144.101  Purpose.
144.102  Application.
144.103  Definitions.
144.104--144.109  [Reserved]
144.110  Self-evaluation.
144.111  Notice.
144.112--144.129  [Reserved]
144.130  General prohibitions against discrimination.
144.131--144.139  [Reserved]
144.140  Employment.
144.141--144.148  [Reserved]
144.149  Program accessibility: Discrimination prohibited.
144.150  Program accessibility: Existing facilities.
144.151  Program accessibility: New construction and alterations.
144.152--144.159  [Reserved]
144.160  Communications.
144.161--144.169  [Reserved]
144.170  Compliance procedures.
144.171--144.999  [Reserved]

    Authority:  29 U.S.C. 794.

    Source:  51 FR 22890, 22896, June 23, 1986, unless otherwise noted.



Sec. 144.101  Purpose.

    This part effectuates section 119 of the Rehabilitation, 
Comprehensive Services, and Developmental Disabilities Amendments of 
1978, which

[[Page 506]]

amended section 504 of the Rehabilitation Act of 1973 to prohibit 
discrimination on the basis of handicap in programs or activities 
conducted by Executive agencies or the United States Postal Service.



Sec. 144.102  Application.

    This part applies to all programs or activities conducted by the 
agency.



Sec. 144.103  Definitions.

    For purposes of this part, the term--
    Assistant Attorney General means the Assistant Attorney General, 
Civil Rights Division, United States Department of Justice.
    Auxiliary aids means services or devices that enable persons with 
impaired sensory, manual, or speaking skills to have an equal 
opportunity to participate in, and enjoy the benefits of, programs or 
activities conducted by the agency. For example, auxiliary aids useful 
for persons with impaired vision include readers, brailled materials, 
audio recordings, telecommunications devices and other similar services 
and devices. Auxiliary aids useful for persons with impaired hearing 
include telephone handset amplifiers, telephones compatible with hearing 
aids, telecommunication devices for deaf persons (TDD's), interpreters, 
notetakers, written materials, and other similar services and devices.
    Complete complaint means a written statement that contains the 
complainant's name and address and describes the agency's alleged 
discriminatory action in sufficient detail to inform the agency of the 
nature and date of the alleged violation of section 504. It shall be 
signed by the complainant or by someone authorized to do so on his or 
her behalf. Complaints filed on behalf of classes or third parties shall 
describe or identify (by name, if possible) the alleged victims of 
discrimination.
    Facility means all or any portion of buildings, structures, 
equipment, roads, walks, parking lots, rolling stock or other 
conveyances, or other real or personal property.
    Handicapped person means any person who has a physical or mental 
impairment that substantially limits one or more major life activities, 
has a record of such an impairment, or is regarded as having such an 
impairment.
    As used in this definition, the phrase:
    (1) Physical or mental impairment includes--
    (i) Any physiological disorder or condition, cosmetic disfigurement, 
or anatomical loss affecting one or more of the following body systems: 
Neurological; musculoskeletal; special sense organs; respiratory, 
including speech organs; cardiovascular; reproductive; digestive; 
genitourinary; hemic and lymphatic; skin; and endocrine; or
    (ii) Any mental or psychological disorder, such as mental 
retardation, organic brain syndrome, emotional or mental illness, and 
specific learning disabilities. The term ``physical or mental 
impairment'' includes, but is not limited to, such diseases and 
conditions as orthopedic, visual, speech, and hearing impairments, 
cerebral palsy, epilepsy, muscular dystrophy, multiple sclerosis, 
cancer, heart disease, diabetes, mental retardation, emotional illness, 
and drug addiction and alocoholism.
    (2) Major life activities includes functions such as caring for 
one's self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (3) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more major life activities.
    (4) Is regarded as having an impairment means--
    (i) Has a physical or mental impairment that does not substantially 
limit major life activities but is treated by the agency as constituting 
such a limitation;
    (ii) Has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward 
such impairment; or
    (iii) Has none of the impairments defined in paragraph (1) of this 
definition but is treated by the agency as having such an impairment.
    Historic preservation programs means programs conducted by the 
agency that have preservation of historic properties as a primary 
purpose.

[[Page 507]]

    Historic properties means those properties that are listed or 
eligible for listing in the National Register of Historic Places or 
properties designated as historic under a statute of the appropriate 
State or local government body.
    Qualified handicapped person means--
    (1) With respect to preschool, elementary, or secondary education 
services provided by the agency, a handicapped person who is a member of 
a class of persons otherwise entitled by statute, regulation, or agency 
policy to receive education services from the agency.
    (2) With respect to any other agency program or activity under which 
a person is required to perform services or to achieve a level of 
accomplishment, a handicapped person who meets the essential eligibility 
requirements and who can acheive the purpose of the program or activity 
without modifications in the program or activity that the agency can 
demonstrate would result in a fundamental alteration in its nature;
    (3) With respect to any other program or activity, a handicapped 
person who meets the essential eligibility requirements for 
participation in, or receipt of benefits from, that program or activity; 
and
    (4) Qualified handicapped person is defined for purposes of 
employment in 29 CFR 1613.702(f), which is made applicable to this part 
by Sec. 144.140.
    Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112, 87 Stat. 394 (29 U.S.C. 794)), as amended by the 
Rehabilitation Act Amendments of 1974 (Pub. L. 93-516, 88 Stat. 1617), 
and the Rehabilitation, Comprehensive Services, and Developmental 
Disabilities Amendments of 1978 (Pub. L. 95-602, 92 Stat. 2955). As used 
in this part, section 504 applies only to programs or activities 
conducted by Executive agencies and not to federally assisted programs.
    Substantial impairment means a significant loss of the integrity of 
finished materials, design quality, or special character resulting from 
a permanent alteration.



Secs. 144.104--144.109  [Reserved]



Sec. 144.110  Self-evaluation.

    (a) The agency shall, by August 24, 1987, evaluate its current 
policies and practices, and the effects thereof, that do not or may not 
meet the requirements of this part, and, to the extent modification of 
any such policies and practices is required, the agency shall proceed to 
make the necessary modifications.
    (b) The agency shall provide an opportunity to interested persons, 
including handicapped persons or organizations representing handicapped 
persons, to participate in the self-evaluation process by submitting 
comments (both oral and written).
    (c) The agency shall, until three years following the completion of 
the self-evaluation, maintain on file and make available for public 
inspection:
    (1) A description of areas examined and any problems identified, and
    (2) A description of any modifications made.



Sec. 144.111  Notice.

    The agency shall make available to employees, applicants, 
participants, beneficiaries, and other interested persons such 
information regarding the provisions of this part and its applicability 
to the programs or activities conducted by the agency, and make such 
information available to them in such manner as the head of the agency 
finds necessary to apprise such persons of the protections against 
discrimination assured them by section 504 and this regulation.



Secs. 144.112--144.129  [Reserved]



Sec. 144.130  General prohibitions against discrimination.

    (a) No qualified handicapped person shall, on the basis of handicap, 
be excluded from participation in, be denied the benefits of, or 
otherwise be subjected to discrimination under any program or activity 
conducted by the agency.

[[Page 508]]

    (b)(1) The agency, in providing any aid, benefit, or service, may 
not, directly or through contractual, licensing, or other arrangements, 
on the basis of handicap--
    (i) Deny a qualified handicapped person the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualified handicapped person an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified handicapped person with an aid, benefit, 
or service that is not as effective in affording equal opportunity to 
obtain the same result, to gain the same benefit, or to reach the same 
level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits, or services to 
handicapped persons or to any class of handicapped persons than is 
provided to others unless such action is necessary to provide qualified 
handicapped persons with aid, benefits, or services that are as 
effective as those provided to others;
    (v) Deny a qualified handicapped person the opportunity to 
participate as a member of planning or advisory boards; or
    (vi) Otherwise limit a qualified handicapped person in the enjoyment 
of any right, privilege, advantage, or opportunity enjoyed by others 
receiving the aid, benefit, or service.
    (2) The agency may not deny a qualified handicapped person the 
opportunity to participate in programs or activities that are not 
separate or different, despite the existence of permissibly separate or 
different programs or activities.
    (3) The agency may not, directly or through contractual or other 
arrangments, utilize criteria or methods of administration the purpose 
or effect of which would--
    (i) Subject qualified handicapped persons to discrimination on the 
basis of handicap; or
    (ii) Defeat or substantially impair accomplishment of the objectives 
of a program or activity with respect to handicapped persons.
    (4) The agency may not, in determining the site or location of a 
facility, make selections the purpose or effect of which would--
    (i) Exclude handicapped persons from, deny them the benefits of, or 
otherwise subject them to discrimination under any program or activity 
conducted by the agency; or
    (ii) Defeat or substantially impair the accomplishment of the 
objectives of a program or activity with respect to handicapped persons.
    (5) The agency, in the selection of procurement contractors, may not 
use criteria that subject qualified handicapped persons to 
discrimination on the basis of handicap.
    (6) The agency may not administer a licensing or certification 
program in a manner that subjects qualified handicapped persons to 
discrimination on the basis of handicap, nor may the agency establish 
requirements for the programs or activities of licensees or certified 
entities that subject qualified handicapped persons to discrimination on 
the basis of handicap. However, the programs or activities of entities 
that are licensed or certified by the agency are not, themselves, 
covered by this part.
    (c) The exclusion of nonhandicapped persons from the benefits of a 
program limited by Federal statute or Executive order to handicapped 
persons or the exclusion of a specific class of handicapped persons from 
a program limited by Federal statute or Executive order to a different 
class of handicapped persons is not prohibited by this part.
    (d) The agency shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified handicapped 
persons.



Secs. 144.131--144.139  [Reserved]



Sec. 144.140  Employment.

    No qualified handicapped person shall, on the basis of handicap, be 
subjected to discrimination in employment under any program or activity 
conducted by the agency. The definitions, requirements, and procedures 
of section 501 of the Rehabilitation Act of 1973 (29 U.S.C. 791), as 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613, shall

[[Page 509]]

apply to employment in federally conducted programs or activities.



Secs. 144.141--144.148  [Reserved]



Sec. 144.149  Program accessibility: Discrimination prohibited.

    Except as otherwise provided in Sec. 144.150, no qualified 
handicapped person shall, because the agency's facilities are 
inaccessible to or unusable by handicapped persons, be denied the 
benefits of, be excluded from participation in, or otherwise be 
subjected to discrimination under any program or activity conducted by 
the agency.



Sec. 144.150  Program accessibility: Existing facilities.

    (a) General. The agency shall operate each program or activity so 
that the program or activity, when viewed in its entirety, is readily 
accessible to and usable by handicapped persons. This paragraph does 
not--
    (1) Necessarily require the agency to make each of its existing 
facilities accessible to and usable by handicapped persons;
    (2) In the case of historic preservation programs, require the 
agency to take any action that would result in a substantial impairment 
of significant historic features of an historic property; or
    (3) Require the agency to take any action that it can demonstrate 
would result in a fundamental alteration in the nature of a program or 
activity or in undue financial and administrative burdens. In those 
circumstances where agency personnel believe that the proposed action 
would fundamentally alter the program or activity or would result in 
undue financial and administrative burdens, the agency has the burden of 
proving that compliance with Sec. 144.150(a) would result in such 
alteration or burdens. The decision that compliance would result in such 
alteration or burdens must be made by the agency head or his or her 
designee after considering all agency resources available for use in the 
funding and operation of the conducted program or activity, and must be 
accompanied by a written statement of the reasons for reaching that 
conclusion. If an action would result in such an alteration or such 
burdens, the agency shall take any other action that would not result in 
such an alteration or such burdens but would nevertheless ensure that 
handicapped persons receive the benefits and services of the program or 
activity.
    (b) Methods--(1) General. The agency may comply with the 
requirements of this section through such means as redesign of 
equipment, reassignment of services to accessible buildings, assignment 
of aides to beneficiaries, home visits, delivery of services at 
alternate accessible sites, alteration of existing facilities and 
construction of new facilities, use of accessible rolling stock, or any 
other methods that result in making its programs or activities readily 
accessible to and usable by handicapped persons. The agency is not 
required to make structural changes in existing facilities where other 
methods are effective in achieving compliance with this section. The 
agency, in making alterations to existing buildings, shall meet 
accessibility requirements to the extent compelled by the Architectural 
Barriers Act of 1968, as amended (42 U.S.C. 4151-4157), and any 
regulations implementing it. In choosing among available methods for 
meeting the requirements of this section, the agency shall give priority 
to those methods that offer programs and activities to qualified 
handicapped persons in the most integrated setting appropriate.
    (2) Historic preservation programs. In meeting the requirements of 
Sec. 144.150(a) in historic preservation programs, the agency shall give 
priority to methods that provide physical access to handicapped persons. 
In cases where a physical alteration to an historic property is not 
required because of Sec. 144.150(a)(2) or (a)(3), alternative methods of 
achieving program accessibility include--
    (i) Using audio-visual materials and devices to depict those 
portions of an historic property that cannot otherwise be made 
accessible;
    (ii) Assigning persons to guide handicapped persons into or through 
portions of historic properties that cannot otherwise be made 
accessible; or
    (iii) Adopting other innovative methods.

[[Page 510]]

    (c) Time period for compliance. The agency shall comply with the 
obligations established under this section by October 21, 1986, except 
that where structural changes in facilities are undertaken, such changes 
shall be made by August 22, 1989, but in any event as expeditiously as 
possible.
    (d) Transition plan. In the event that structural changes to 
facilities will be undertaken to achieve program accessibility, the 
agency shall develop, by February 23, 1987, a transition plan setting 
forth the steps necessary to complete such changes. The agency shall 
provide an opportunity to interested persons, including handicapped 
persons or organizations representing handicapped persons, to 
participate in the development of the transition plan by submitting 
comments (both oral and written). A copy of the transition plan shall be 
made available for public inspection. The plan shall, at a minimum--
    (1) Identify physical obstacles in the agency's facilities that 
limit the accessibility of its programs or activities to handicapped 
persons;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
compliance with this section and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the official responsible for implementation of the 
plan.



Sec. 144.151  Program accessibility: New construction and alterations.

    Each building or part of a building that is constructed or altered 
by, on behalf of, or for the use of the agency shall be designed, 
constructed, or altered so as to be readily accessible to and usable by 
handicapped persons. The definitions, requirements, and standards of the 
Architectural Barriers Act (42 U.S.C. 4151-4157), as established in 41 
CFR 101-19.600 to 101-19.607, apply to buildings covered by this 
section.



Secs. 144.152--144.159  [Reserved]



Sec. 144.160  Communications.

    (a) The agency shall take appropriate steps to ensure effective 
communication with applicants, participants, personnel of other Federal 
entities, and members of the public.
    (1) The agency shall furnish appropriate auxiliary aids where 
necessary to afford a handicapped person an equal opportunity to 
participate in, and enjoy the benefits of, a program or activity 
conducted by the agency.
    (i) In determining what type of auxiliary aid is necessary, the 
agency shall give primary consideration to the requests of the 
handicapped person.
    (ii) The agency need not provide individually prescribed devices, 
readers for personal use or study, or other devices of a personal 
nature.
    (2) Where the agency communicates with applicants and beneficiaries 
by telephone, telecommunication devices for deaf person (TDD's) or 
equally effective telecommunication systems shall be used.
    (b) The agency shall ensure that interested persons, including 
persons with impaired vision or hearing, can obtain information as to 
the existence and location of accessible services, activities, and 
facilities.
    (c) The agency shall provide signage at a primary entrance to each 
of its inaccessible facilities, directing users to a location at which 
they can obtain information about accessible facilities. The 
international symbol for accessibility shall be used at each primary 
entrance of an accessible facility.
    (d) This section does not require the agency to take any action that 
it can demonstrate would result in a fundamental alteration in the 
nature of a program or activity or in undue financial and adminstrative 
burdens. In those circumstances where agency personnel believe that the 
proposed action would fundamentally alter the program or activity or 
would result in undue financial and administrative burdens, the agency 
has the burden of proving that compliance with Sec. 144.160 would result 
in such alteration or burdens. The decision that compliance would result 
in such alteration or burdens must be

[[Page 511]]

made by the agency head or his or her designee after considering all 
agency resources available for use in the funding and operation of the 
conducted program or activity, and must be accompanied by a written 
statement of the reasons for reaching that conclusion. If an action 
required to comply with this section would result in such an alteration 
or such burdens, the agency shall take any other action that would not 
result in such an alteration or such burdens but would nevertheless 
ensure that, to the maximum extent possible, handicapped persons receive 
the benefits and services of the program or activity.



Secs. 144.161--144.169  [Reserved]



Sec. 144.170  Compliance procedures.

    (a) Except as provided in paragraph (b) of this section, this 
section applies to all allegations of discrimination on the basis of 
handicap in programs or activities conducted by the agency.
    (b) The agency shall process complaints alleging violations of 
section 504 with respect to employment according to the procedures 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613 pursuant to section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791).
    (c) The Deputy Assistant Secretary for Equal Employment Opportunity 
and Civil Rights shall be responsible for coordinating implementation of 
this section. Complaints may be sent to Deputy Assistant Secretary for 
Equal Employment Opportunity and Civil Rights, Department of State, 2201 
C Street, NW., Room 3214, Washington, DC 20520.
    (d) The agency shall accept and investigate all complete complaints 
for which it has jurisdiction. All complete complaints must be filed 
within 180 days of the alleged act of discrimination. The agency may 
extend this time period for good cause.
    (e) If the agency receives a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate government 
entity.
    (f) The agency shall notify the Architectural and Transportation 
Barriers Compliance Board upon receipt of any complaint alleging that a 
building or facility that is subject to the Architectural Barriers Act 
of 1968, as amended (42 U.S.C. 4151-4157), or section 502 of the 
Rehabilitation Act of 1973, as amended (29 U.S.C. 792), is not readily 
accessible to and usable by handicapped persons.
    (g) Within 180 days of the receipt of a complete complaint for which 
it has jurisdiction, the agency shall notify the complainant of the 
results of the investigation in a letter containing--
    (1) Findings of fact and conclusions of law;
    (2) A description of a remedy for each violation found; and
    (3) A notice of the right to appeal.
    (h) Appeals of the findings of fact and conclusions of law or 
remedies must be filed by the complainant within 90 days of receipt from 
the agency of the letter required by Sec. 144.170(g). The agency may 
extend this time for good cause.
    (i) Timely appeals shall be accepted and processed by the head of 
the agency.
    (j) The head of the agency shall notify the complainant of the 
results of the appeal within 60 days of the receipt of the request. If 
the head of the agency determines that additional information is needed 
from the complainant, he or she shall have 60 days from the date of 
receipt of the additional information to make his or her determination 
on the appeal.
    (k) The time limits cited in paragraphs (g) and (j) of this section 
may be extended with the permission of the Assistant Attorney General.
    (l) The agency may delegate its authority for conducting complaint 
investigations to other Federal agencies, except that the authority for 
making the final determination may not be delegated to another agency.
[51 FR 22890, 22896, June 23, 1986, as amended at 51 FR 22890, June 23, 
1986]

[[Page 512]]



Secs. 144.171--144.999  [Reserved]



PART 145--GRANTS AND AGREEMENTS WITH INSTITUTIONS OF HIGHER EDUCATION, HOSPITALS, AND OTHER NON-PROFIT ORGANIZATIONS--Table of Contents




                           Subpart A--General

Sec.
145.1  Purpose.
145.2  Definitions.
145.3  Effect on other issuances.
145.4  Deviations.
145.5  Subawards.

                    Subpart B--Pre-Award Requirements

145.10  Purpose.
145.11  Pre-award policies.
145.12  Forms for applying for Federal assistance.
145.13  Debarment and suspension.
145.14  Special award conditions.
145.15  Metric system of measurement.
145.16  Resource Conservation and Recovery Act.
145.17  Certifications and representations.

                   Subpart C--Post-Award Requirements

                    Financial and Program Management

145.20  Purpose of financial and program management.
145.21  Standards for financial management systems.
145.22  Payment.
145.23  Cost sharing or matching.
145.24  Program income.
145.25  Revision of budget and program plans.
145.26  Non-Federal audits.
145.27  Allowable costs.
145.28  Period of availability of funds.

                           Property Standards

145.30  Purpose of property standards.
145.31  Insurance coverage.
145.32  Real property.
145.33  Federally-owned and exempt property.
145.34  Equipment.
145.35  Supplies and other expendable property.
145.36  Intangible property.
145.37  Property trust relationship.

                          Procurement Standards

145.40  Purpose of procurement standards.
145.41  Recipient responsibilities.
145.42  Code of conduct.
145.43  Competition.
145.44  Procurement procedures.
145.45  Cost and price analysis.
145.46  Procurement records.
145.47  Contract administration.
145.48  Contract clauses.

                           Reports and Records

145.50  Purpose of reports and records.
145.51  Monitoring and reporting program performance.
145.52  Financial reporting.
145.53  Retention and access requirements for records.

                       Termination and Enforcement

145.60  Purpose of termination and enforcement.
145.61  Termination.
145.62  Enforcement.

                 Subpart D--After-the-Award Requirements

145.70  Purpose.
145.71  Closeout procedures.
145.72  Subsequent adjustments and continuing responsibilities.
145.73  Collection of amounts due.


Appendix A to Part 145--Clauses for Contracts and Small Purchases 
          Awarded by Recipient

    Authority:  22 U.S.C. 2658.1

    Source:  59 FR 18731, Apr. 20, 1994, unless otherwise noted.



                           Subpart A--General



Sec. 145.1  Purpose.

    This regulation establishes uniform administrative requirements for 
Department of State grants and cooperative agreements awarded to 
institutions of higher education, hospitals, and other non-profit 
organizations pursuant to OMB Circular A-110. Non-profit organizations 
that implement Federal programs for the States are also subject to State 
requirements. Copies of the OMB circulars mentioned in this part may be 
ordered from the Office of Management and Budget Publications Office 
(202) 395-7000.



Sec. 145.2  Definitions.

    (a) Accrued expenditures means the charges incurred by the recipient 
during a given period requiring the provision of funds for:
    (1) Goods and other tangible property received;
    (2) Services performed by employees, contractors, subrecipients, and 
other payees; and,

[[Page 513]]

    (3) Other amounts becoming owed under programs for which no current 
services or performance is required.
    (b) Accrued income means the sum of:
    (1) Earnings during a given period from--
    (i) Services performed by the recipient, and
    (ii) Goods and other tangible property delivered to purchasers, and
    (2) Amounts becoming owed to the recipient for which no current 
services or performance is required by the recipient.
    (c) Acquisition cost of equipment means the net invoice price of the 
equipment, including the cost of modifications, attachments, 
accessories, or auxiliary apparatus necessary to make the property 
usable for the purpose for which it was acquired. Other charges, such as 
the cost of installation, transportation, taxes, duty or protective in-
transit insurance, shall be included or excluded from the unit 
acquisition cost in accordance with the recipient's regular accounting 
practices.
    (d) Advance means a payment made by Treasury check or other 
appropriate payment mechanism to a recipient upon its request either 
before outlays are made by the recipient or through the use of 
predetermined payment schedules.
    (e) Award means financial assistance that provides support or 
stimulation to accomplish a public purpose. Awards include grants and 
other agreements in the form of money or property in lieu of money, by 
the Federal Government to an eligible recipient. The term does not 
include: Technical assistance, which provides services instead of money; 
other assistance in the form of loans, loan guarantees, interest 
subsidies, or insurance; direct payments of any kind to individuals; 
and, contracts which are required to be entered into and administered 
under procurement laws and regulations.
    (f) Cash contributions means the recipient's cash outlay, including 
the outlay of money contributed to the recipient by third parties.
    (g) Closeout means the process by which an awarding agency 
determines that all applicable administrative actions and all required 
work of the award have been completed by the recipient and awarding 
agency.
    (h) Contract means a procurement contract under an award or 
subaward, and a procurement subcontract under a recipient's or 
subrecipient's contract.
    (i) Cooperative agreement, as defined in 31 U.S.C. 6305, means a 
legal instrument reflecting a relationship between the United States 
Government and a recipient when the principal purpose of the 
relationship is to transfer a thing of value to the recipient to carry 
out a public purpose of support or stimulation authorized by law, 
instead of acquiring property or services for the direct use of the 
United States Government, and substantial involvement is expected 
between the awarding agency and the recipient when carrying out the 
activity contemplated in the agreement.
    (j) Cost sharing or matching means that portion of project or 
program costs not borne by the Federal Government.
    (k) Date of completion means the date on which all work under an 
award is completed or the date on the award document, or any supplement 
or amendment thereto, on which Federal sponsorship ends.
    (l) Disallowed costs means those charges to an award that the 
awarding agency determines to be unallowable, in accordance with the 
applicable Federal cost principles or other terms and conditions 
contained in the award.
    (m) Equipment means tangible nonexpendable personal property 
including exempt property charged directly to the award having a useful 
life of more than one year and an acquisition cost of $5,000 or more per 
unit. However, consistent with recipient policy, lower limits may be 
established.
    (n) Excess property means property under the control of any awarding 
agency that, as determined by the head thereof, is no longer required 
for its needs or the discharge of its responsibilities.
    (o) Exempt property means tangible personal property acquired in 
whole or in part with Federal funds, where the awarding agency has 
statutory authority to vest title in the recipient without further 
obligation to the Federal Government. An example of exempt

[[Page 514]]

property authority is contained in the Federal Grant and Cooperative 
Agreement Act (31 U.S.C. 6306), for property acquired under an award to 
conduct basic or applied research by a non-profit institution of higher 
education or non-profit organization whose principal purpose is 
conducting scientific research.
    (p) Federal awarding agency or awarding agency means the Federal 
agency that provides an award to the recipient.
    (q) Federal funds authorized means the total amount of Federal funds 
obligated by the Federal Government for use by the recipient. This 
amount may include any authorized carryover of unobligated funds from 
prior funding periods when permitted by agency regulations or agency 
implementing instructions.
    (r) Federal share of real property, equipment, or supplies means 
that percentage of the property's acquisition costs and any improvement 
expenditures paid with Federal funds.
    (s) Funding period means the period of time when Federal funding is 
available for obligation by the recipient.
    (t) Grant, as defined in 31 U.S.C. 6304, means a legal instrument 
reflecting a relationship between the United States Government and a 
recipient when the principal purpose of the relationship is to transfer 
a thing of value to the recipient to carry out a public purpose of 
support or stimulation authorized by law, instead of acquiring property 
or services for the direct use of the United States Government, and 
substantial involvement is not expected between the awarding agency and 
the recipient when carrying out the activity contemplated in the 
agreement.
    (u) Intangible property and debt instruments means, but is not 
limited to, trademarks, copyrights, patents and patent applications and 
such property as loans, notes and other debt instruments, lease 
agreements, stock and other instruments of property ownership, whether 
considered tangible or intangible.
    (v) Obligations means the amounts of orders placed, contracts and 
grants awarded, services received and similar transactions during a 
given period that require payment by the recipient during the same or a 
future period.
    (w) Outlays or expenditures means charges made to the project or 
program. They may be reported on a cash or accrual basis. For reports 
prepared on a cash basis, outlays are the sum of cash disbursements for 
direct charges for goods and services, the amount of indirect expense 
charged, the value of third party in-kind contributions applied and the 
amount of cash advances and payments made to subrecipients. For reports 
prepared on an accrual basis, outlays are the sum of cash disbursements 
for direct charges for goods and services, the amount of indirect 
expense incurred, the value of in-kind contributions applied, and the 
net increase (or decrease) in the amounts owed by the recipient for 
goods and other property received, for services performed by employees, 
contractors, subrecipients and other payees and other amounts becoming 
owed under programs for which no current services or performance are 
required.
    (x) Personal property means property of any kind except real 
property. It may be tangible, having physical existence, or intangible, 
having no physical existence, such as copyrights, patents, or 
securities.
    (y) Prior approval means written approval by an authorized official 
evidencing prior consent.
    (z) Program income means gross income earned by the recipient that 
is directly generated by a supported activity or earned as a result of 
the award (see exclusions in Sec. 145.24 (e) and (h)). Program income 
includes, but is not limited to, income from fees for services 
performed, the use or rental of real or personal property acquired under 
federally-funded projects, the sale of commodities or items fabricated 
under an award, license fees and royalties on patents and copyrights, 
and interest on loans made with award funds. Interest earned on advances 
of Federal funds is not program income. Except as otherwise provided in 
awarding agency regulations or the terms and conditions of the award, 
program income does not include the receipt of principal on loans, 
rebates, credits, discounts, etc., or interest earned on any of them.

[[Page 515]]

    (aa) Project costs means all allowable costs, as set forth in the 
applicable Federal cost principles, incurred by a recipient and the 
value of the contributions made by third parties in accomplishing the 
objectives of the award during the project period.
    (bb) Project period means the period established in the award 
document during which Federal sponsorship begins and ends.
    (cc) Property means, unless otherwise stated, real property, 
equipment, intangible property and debt instruments.
    (dd) Real property means land, including land improvements, 
structures and appurtenances thereto, but excludes movable machinery and 
equipment.
    (ee) Recipient means an organization receiving financial assistance 
directly from Federal awarding agencies to carry out a project or 
program.
    (1) The term includes public and private institutions of higher 
education; public and private hospitals; other quasi-public and private 
non-profit organizations such as, but not limited to, community action 
agencies, research institutes, educational associations, and health 
centers; and commercial organizations receiving grants or cooperative 
agreements from the Department.
    (2) The term does not include any of the following which are 
recipients, subrecipients, or contractors or subcontractors of 
recipients or subrecipients:
    (i) Foreign organizations (governmental or non-governmental);
    (ii) International organizations (such as agencies of the United 
Nations); or
    (iii) Organizations whose assistance agreement is for work to be 
performed outside the United States.
    (3) The term does not include government-owned contractor-operated 
facilities or research centers providing continued support for mission-
oriented, large-scale programs that are government-owned or controlled, 
or are designated as federally-funded research and development centers.
    (ff) Research and development means all research activities, both 
basic and applied, and all development activities that are supported at 
universities, colleges, and other non-profit institutions. ``Research'' 
is defined as a systematic study directed toward fuller scientific 
knowledge or understanding of the subject studied. ``Development'' is 
the systematic use of knowledge and understanding gained from research 
directed toward the production of useful materials, devices, systems, or 
methods, including design and development of prototypes and processes. 
The term research also includes activities involving the training of 
individuals in research techniques where such activities utilize the 
same facilities as other research and development activities and where 
such activities are not included in the instruction function.
    (gg) Small awards means a grant or cooperative agreement not 
exceeding $100,000 or the small purchase limitation fixed at 41 U.S.C. 
403(11), whichever is greater.
    (hh) Small purchase limitation, for procurements transactions 
awarded by recipients, means $100,000 or the small purchase limitation 
fixed at 41 U.S.C. 403(11), whichever is greater.
    (ii) Subaward means an award of financial assistance in the form of 
money, or property in lieu of money, made under an award by a recipient 
to an eligible subrecipient or by a subrecipient to a lower tier 
subrecipient. The term includes financial assistance when provided by 
any legal agreement, even if the agreement is called a contract, but 
does not include procurement of goods and services nor does it include 
any form of assistance which is excluded from the definition of 
``award'' in Sec. 145.2(e).
    (jj) Subrecipient means the legal entity to which a subaward is made 
and which is accountable to the recipient for the use of the funds 
provided. The term may include foreign or international organizations 
(such as agencies of the United Nations) at the discretion of the 
awarding agency.
    (kk) Supplies means all personal property excluding equipment, 
intangible property, and debt instruments as defined in this section, 
and inventions of a contractor conceived or first actually reduced to 
practice in the performance of work under a funding agreement (``subject 
inventions''), as defined in 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and

[[Page 516]]

Small Business Firms Under Government Grants, Contracts, and Cooperative 
Agreements.''
    (ll) Suspension means an action by a awarding agency that 
temporarily withdraws Federal sponsorship under an award, pending 
corrective action by the recipient or pending a decision to terminate 
the award by the awarding agency. Suspension of an award is a separate 
action from suspension under Federal agency regulations implementing 
E.O.s 12549 and 12689, ``Debarment and Suspension.''
    (mm) Termination means the cancellation of Federal sponsorship, in 
whole or in part, under an agreement at any time prior to the date of 
completion.
    (nn) Third party in-kind contributions means the value of non-cash 
contributions provided by non-Federal third parties. Third party in-kind 
contributions may be in the form of real property, equipment, supplies 
and other expendable property, and the value of goods and services 
directly benefiting and specifically identifiable to the project or 
program.
    (oo) Unliquidated obligations, for financial reports prepared on a 
cash basis, means the amount of obligations incurred by the recipient 
that have not been paid. For reports prepared on an accrued expenditure 
basis, they represent the amount of obligations incurred by the 
recipient for which an outlay has not been recorded.
    (pp) Unobligated balance means the portion of the funds authorized 
by the awarding agency that has not been obligated by the recipient and 
is determined by deducting the cumulative obligations from the 
cumulative funds authorized.
    (qq) Unrecovered indirect cost means the difference between the 
amount awarded and the amount which could have been awarded under the 
recipient's approved negotiated indirect cost rate.
    (rr) Working capital advance means a procedure where by funds are 
advanced to the recipient to cover its estimated disbursement needs for 
a given initial period.



Sec. 145.3  Effect on other issuances.

    For awards subject to this regulation, all administrative 
requirements of codified program regulations, program manuals, handbooks 
and other nonregulatory materials which are inconsistent with the 
requirements of this regulation are superseded, except to the extent 
they are required by statute, or authorized in accordance with the 
deviations provision in Sec. 145.4.



Sec. 145.4  Deviations.

    The Office of Management and Budget (OMB) may grant exceptions for 
classes of grants or recipients subject to the requirements of this 
regulation when exceptions are not prohibited by statute. However, in 
the interest of maximum uniformity, exceptions from the requirements of 
this regulation shall be permitted only in unusual circumstances. The 
Department may apply more restrictive requirements to a class of 
recipients when approved by OMB. The Department may apply less 
restrictive requirements when issuing small awards, except for those 
requirements which are statutory. Exceptions on a case-by-case basis may 
also be made by the Department. Deviation requests shall be submitted to 
the Office of the Procurement Executive (A/OPE) for approval or 
transmittal to OMB.



Sec. 145.5  Subawards.

    Unless sections of this regulation specifically exclude 
subrecipients from coverage, the provisions of this regulation shall be 
applied to subrecipients performing work under awards if such 
subrecipients are institutions of higher education, hospitals or other 
non-profit organizations. State and local government subrecipients are 
subject to the provisions of part 135 of this chapter implementing the 
grants management common rule, ``Uniform Administrative Requirements for 
Grants and Cooperative Agreements to State and Local Governments.''



                    Subpart B--Pre-Award Requirements



Sec. 145.10  Purpose.

    Sections 145.11 through 145.17 prescribe forms and instructions and 
other

[[Page 517]]

pre-award matters to be used in applying for Federal awards.



Sec. 145.11  Pre-award policies.

    (a) Use of grants and cooperative agreements, and contracts. In each 
instance, the awarding agency shall decide on the appropriate award 
instrument (i.e., grant, cooperative agreement, or contract). The 
Federal Grant and Cooperative Agreement Act (31 U.S.C. 6301-08) governs 
the use of grants, cooperative agreements and contracts. A grant or 
cooperative agreement shall be used only when the principal purpose of a 
transaction is to accomplish a public purpose of support or stimulation 
authorized by Federal statute. The statutory criterion for choosing 
between grants and cooperative agreements is that for the latter, 
``substantial involvement is expected between the executive agency and 
the State, local government, or other recipient when carrying out the 
activity contemplated in the agreement.'' Contracts shall be used when 
the principal purpose is acquisition of property or services for the 
direct benefit or use of the Federal Government. The Department may not 
award grants or cooperative agreements unless specific statutory 
authority exists for a program allowing the award of Federal assistance.
    (b) Public notice and priority setting.
    (1) The Department shall notify the public of its intended funding 
priorities for discretionary grant programs, except for:
    (i) Awards for which funding priorities are established by Federal 
statute,
    (ii) Small awards, and
    (iii) Awards for which program purposes would not be served by 
public notice.
    (2) In the case of the exception in paragraph (b)(1)(iii) of this 
section, the award file shall be documented with the rationale for not 
issuing a public notice.



Sec. 145.12  Forms for applying for Federal assistance.

    (a) Department Grants Officers shall comply with the applicable 
report clearance requirements of 5 CFR part 1320, ``Controlling 
Paperwork Burdens on the Public,'' with regard to all forms used by the 
awarding agency in place of or as a supplement to the Standard Form 424 
(SF-424) series.
    (b) Applicants shall use the SF-424 series or those forms and 
instructions prescribed by the Grants Officer and approved by the Office 
of the Procurement Executive (A/OPE).
    (c) For Federal programs covered by Executive Order 12372, 
``Intergovernmental Review of Federal Programs,'' the applicant shall 
complete the appropriate sections of the SF-424 (Application for Federal 
Assistance) indicating whether the application was subject to review by 
the State Single Point of Contact (SPOC). The name and address of the 
SPOC for a particular State can be obtained from the awarding agency or 
the Catalog of Federal Domestic Assistance. The SPOC shall advise the 
applicant whether the program for which application is made has been 
selected by that State for review.
    (d) Department Grants Officers who do not use the SF-424 form should 
indicate whether the application is subject to review by the State under 
Executive Order 12372.



Sec. 145.13  Debarment and suspension.

    The Department and recipients shall comply with the nonprocurement 
debarment and suspension common rule implementing Executive Orders 12549 
and 12689, ``Debarment and Suspension,'' as implemented in 22 CFR part 
137. This common rule restricts subawards and contracts with certain 
parties that are debarred, suspended or otherwise excluded from or 
ineligible for participation in Federal assistance programs or 
activities.



Sec. 145.14  Special award conditions.

    If an applicant or recipient: has a history of poor performance, is 
not financially stable, has a management system that does not meet the 
standards prescribed in this regulation, has not conformed to the terms 
and conditions of a previous award, or is not otherwise responsible, the 
Department may impose additional requirements as needed, provided that 
such applicant or recipient is notified in writing as to: The nature of 
the additional requirements, the reason why the additional requirements 
are being imposed, the nature of

[[Page 518]]

the corrective action needed, the time allowed for completing the 
corrective actions, and the method for requesting reconsideration of the 
additional requirements imposed. Any special conditions shall be 
promptly removed once the conditions that prompted them have been 
corrected.



Sec. 145.15  Metric system of measurement.

    The Metric Conversion Act, as amended by the Omnibus Trade and 
Competitiveness Act (15 U.S.C. 205) declares that the metric system is 
the preferred measurement system for U.S. trade and commerce. The Act 
requires each Federal agency to establish a date or dates in 
consultation with the Secretary of Commerce, when the metric system of 
measurement will be used in the agency's procurements, grants, and other 
business-related activities. Metric implementation may take longer where 
the use of the system is initially impractical or likely to cause 
significant inefficiencies in the accomplishment of federally-funded 
activities. Federal awarding agencies shall follow the provisions of 
E.O. 12770, ``Metric Usage in Federal Government Programs.''



Sec. 145.16  Resource Conservation and Recovery Act.

    Under the Resource Conservation and Recovery Act (RCRA) (Pub. L. 94-
580 codified at 42 U.S.C. 6962), any State agency or agency of a 
political subdivision of a State which is using appropriated Federal 
funds must comply with section 6002. Section 6002 requires that 
preference be given in procurement programs to the purchase of specific 
products containing recycled materials identified in guidelines 
developed by the Environmental Protection Agency (EPA) (40 CFR parts 
247-254). Accordingly, State and local institutions of higher education, 
hospitals, and non-profit organizations that receive direct Federal 
awards or other Federal funds shall give preference in their procurement 
programs funded with Federal funds to the purchase of recycled products 
pursuant to the EPA guidelines.



Sec. 145.17  Certifications and representations.

    Unless prohibited by statute or codified regulation, the Department 
is authorized to accept and encourages recipients to submit 
certifications and representations required by statute, executive order, 
or regulation on an annual basis, if the recipients have ongoing and 
continuing relationships with the Department. Annual certifications and 
representations shall be signed by responsible officials with the 
authority to ensure recipients' compliance with the pertinent 
requirements.



                   Subpart C--Post-Award Requirements

                    Financial and Program Management



Sec. 145.20  Purpose of financial and program management.

    Sections 145.21 through 145.28 prescribe standards for financial 
management systems, methods for making payments and rules for: 
Satisfying cost sharing and matching requirements, accounting for 
program income, budget revision approvals, making audits, determining 
allowability of cost, and establishing fund availability.



Sec. 145.21  Standards for financial management systems.

    (a) The Department shall require recipients to relate financial data 
to performance data and develop unit cost information whenever 
practical.
    (b) Recipients' financial management systems shall provide for the 
following.
    (1) Accurate, current and complete disclosure of the financial 
results of each federally-sponsored project or program in accordance 
with the reporting requirements set forth in Sec. 145.52. If the 
Department requires reporting on an accrual basis from a recipient that 
maintains its records on other than an accrual basis, the recipient 
shall not be required to establish an accrual accounting system. These 
recipients may develop such accrual data for its reports on the basis of 
an analysis of the documentation on hand.
    (2) Records that identify adequately the source and application of 
funds for federally-sponsored activities. These

[[Page 519]]

records shall contain information pertaining to Federal awards, 
authorizations, obligations, unobligated balances, assets, outlays, 
income and interest.
    (3) Effective control over and accountability for all funds, 
property and other assets. Recipients shall adequately safeguard all 
such assets and assure they are used solely for authorized purposes.
    (4) Comparison of outlays with budget amounts for each award. 
Whenever appropriate, financial information should be related to 
performance and unit cost data.
    (5) Written procedures to minimize the time elapsing between the 
transfer of funds to the recipient from the U.S. Treasury and the 
issuance or redemption of checks, warrants or payments by other means 
for program purposes by the recipient. To the extent that the provisions 
of the Cash Management Improvement Act (CMIA) (Pub. L. 101-453) govern, 
payment methods of State agencies, instrumentalities, and fiscal agents 
shall be consistent with CMIA Treasury-State Agreements or the CMIA 
default procedures codified at 31 CFR part 205, ``Withdrawal of Cash 
from the Treasury for Advances under Federal Grant and Other Programs.''
    (6) Written procedures for determining the reasonableness, 
allocability and allowability of costs in accordance with the provisions 
of the applicable Federal cost principles and the terms and conditions 
of the award.
    (7) Accounting records including cost accounting records that are 
supported by source documentation.
    (c) Where the Federal Government guarantees or insures the repayment 
of money borrowed by the recipient, the Department, at its discretion, 
may require adequate bonding and insurance if the bonding and insurance 
requirements of the recipient are not deemed adequate to protect the 
interest of the Federal Government.
    (d) The Department may require adequate fidelity bond coverage where 
the recipient lacks sufficient coverage to protect the Federal 
Government's interest.
    (e) Where bonds are required in the situations described above, the 
bonds shall be obtained from companies holding certificates of authority 
as acceptable sureties, as prescribed in 31 CFR part 223, ``Surety 
Companies Doing Business with the United States.''



Sec. 145.22  Payment.

    (a) Payment methods shall minimize the time elapsing between the 
transfer of funds from the United States Treasury and the issuance or 
redemption of checks, warrants, or payment by other means by the 
recipients. Payment methods of State agencies or instrumentalities shall 
be consistent with Treasury-State CMIA agreements or default procedures 
codified at 31 CFR part 205.
    (b) Recipients are to be paid in advance, provided they maintain or 
demonstrate the willingness to maintain: Written procedures that 
minimize the time elapsing between the transfer of funds and 
disbursement by the recipient, and financial management systems that 
meet the standards for fund control and accountability as established in 
Sec. 145.21. Cash advances to a recipient organization shall be limited 
to the minimum amounts needed and be timed to be in accordance with the 
actual, immediate cash requirements of the recipient organization in 
carrying out the purpose of the approved program or project. The timing 
and amount of cash advances shall be as close as is administratively 
feasible to the actual disbursements by the recipient organization for 
direct program or project costs and the proportionate share of any 
allowable indirect costs.
    (c) Whenever possible, advances shall be consolidated to cover 
anticipated cash needs for all awards made by the Department to the 
recipient.
    (1) Advance payment mechanisms include, but are not limited to, 
Treasury check and electronic funds transfer.
    (2) Advance payment mechanisms are subject to 31 CFR part 205.
    (3) Recipients shall be authorized to submit requests for advances 
and reimbursements at least monthly when electronic fund transfers are 
not used.
    (d) Requests for Treasury check advance payment shall be submitted 
on SF-270, ``Request for Advance or Reimbursement,'' or other forms as 
may be authorized by OMB (e.g., SF-1034). This form is not to be used 
when Treasury

[[Page 520]]

check advance payments are made to the recipient automatically through 
the use of a predetermined payment schedule or if precluded by special 
Department instructions for electronic funds transfer.
    (e) Reimbursement is the preferred method when the requirements in 
paragraph (b) cannot be met. The Department may also use this method on 
any construction agreement, or if the major portion of the construction 
project is accomplished through private market financing or Federal 
loans, and the Federal assistance constitutes a minor portion of the 
project.
    (1) When the reimbursement method is used, the Department shall make 
payment within 30 days after receipt of the billing, unless the billing 
is improper.
    (2) Recipients shall be authorized to submit request for 
reimbursement at least monthly when electronic funds transfers are not 
used.
    (f) If a recipient cannot meet the criteria for advance payments and 
the Department has determined that reimbursement is not feasible because 
the recipient lacks sufficient working capital, the Department may 
provide cash on a working capital advance basis. Under this procedure, 
the Department shall advance cash to the recipient to cover its 
estimated disbursement needs for an initial period generally geared to 
the awardee's disbursing cycle. Thereafter, the Department shall 
reimburse the recipient for its actual cash disbursements. The working 
capital advance method of payment shall not be used for recipients 
unwilling or unable to provide timely advances to their subrecipient to 
meet the subrecipient's actual cash disbursements.
    (g) To the extent available, recipients shall disburse funds 
available from repayments to and interest earned on a revolving fund, 
program income, rebates, refunds, contract settlements, audit recoveries 
and interest earned on such funds before requesting additional cash 
payments.
    (h) Unless otherwise required by statute, the Department shall not 
withhold payments for proper charges made by recipients at any time 
during the project period unless paragraphs (h) (1) or (2) of this 
section apply.
    (1) A recipient has failed to comply with the project objectives, 
the terms and conditions of the award, or Federal reporting 
requirements.
    (2) The recipient or subrecipient is delinquent in a debt to the 
United States as defined in OMB Circular A-129, ``Managing Federal 
Credit Programs.'' Under such conditions, the Department may, upon 
reasonable notice, inform the recipient that payments shall not be made 
for obligations incurred after a specified date until the conditions are 
corrected or the indebtedness to the Federal Government is liquidated.
    (i) Standards governing the use of banks and other institutions as 
depositories of funds advanced under awards are as follows.
    (1) Except for situations described in paragraph (i)(2), the 
Department shall not require separate depository accounts for funds 
provided to a recipient or establish any eligibility requirements for 
depositories for funds provided to a recipient. However, recipients must 
be able to account for the receipt, obligation and expenditure of funds.
    (2) Advances of Federal funds shall be deposited and maintained in 
insured accounts whenever possible.
    (j) Consistent with the national goal of expanding the opportunities 
for women-owned and minority-owned business enterprises, recipients 
shall be encouraged to use women-owned and minority-owned banks (a bank 
which is owned at least 50 percent by women or minority group members).
    (k) Recipients shall maintain advances of Federal funds in interest 
bearing accounts, unless paragraphs (k) (1), (2) or (3) of this section 
apply.
    (1) The recipient receives less than $120,000 in Federal awards per 
year.
    (2) The best reasonably available interest bearing account would not 
be expected to earn interest in excess of $250 per year on Federal cash 
balances.
    (3) The depository would require an average or minimum balance so 
high that it would not be feasible within the expected Federal and non-
Federal cash resources.
    (l) For those entities where CMIA and its implementing regulations 
do not apply, interest earned on Federal

[[Page 521]]

advances deposited in interest bearing accounts shall be remitted 
annually to the Department for submission to Treasury. Interest amounts 
up to $250 per year may be retained by the recipient for administrative 
expense. State universities and hospitals shall comply with CMIA, as it 
pertains to interest. If an entity subject to CMIA uses its own funds to 
pay pre-award costs for discretionary awards without prior written 
approval from the Department, it waives its right to recover the 
interest under CMIA.
    (m) Except as noted elsewhere in this regulation, only the following 
forms shall be authorized for the recipients in requesting advances and 
reimbursements. The Department shall not require more than an original 
and two copies of these forms except if OMB approval is obtained.
    (1) SF-270, Request for Advance or Reimbursement. The Department 
shall use the SF-270 as a standard form for all nonconstruction programs 
when electronic funds transfer or predetermined advance methods are not 
used. Grants Officers may use forms equivalent to the SF-270 if approved 
in writing by the Office of the Procurement Executive (A/OPE). The 
Department has the option of using the SF-270 for construction programs 
in lieu of the SF-271, ``Outlay Report and Request for Reimbursement for 
Construction Programs.''
    (2) SF-271, Outlay Report and Request for Reimbursement for 
Construction Programs. The Department shall use the SF-271 as the 
standard form to be used for requesting reimbursement for construction 
programs. However, the Department may substitute the SF-270 when the 
Department determines that it provides adequate information to meet 
Federal needs.



Sec. 145.23  Cost sharing or matching.

    (a) All contributions, including cash and third party in-kind, shall 
be accepted as part of the recipient's cost sharing or matching when 
such contributions meet all of the following criteria.
    (1) Are verifiable from the recipient's records.
    (2) Are not included as contributions for any other Federally-
assisted project or program.
    (3) Are necessary and reasonable for proper and efficient 
accomplishment of project or program objectives.
    (4) Are allowable under the applicable cost principles.
    (5) Are not paid by the Federal Government under another award, 
except where authorized by Federal statute to be used for cost sharing 
or matching.
    (6) Are provided for in the approved budget when required by the 
Department.
    (7) Conform to other provisions of this regulation, as applicable.
    (b) Unrecovered indirect costs may be included as part of cost 
sharing or matching only with the prior approval of the Department 
Grants Officer.
    (c) Values for recipient contributions of services and property 
shall be established in accordance with the applicable cost principles. 
If the Department authorizes recipients to donate buildings or land for 
construction/facilities acquisition projects or long-term use, the value 
of the donated property for cost sharing or matching shall be the lesser 
of paragraphs (c) (1) or (2) of this section.
    (1) The certified value of the remaining life of the property 
recorded in the recipient's accounting records at the time of donation.
    (2) The current fair market value. However, when there is sufficient 
justification, the Department may approve the use of the current fair 
market value of the donated property, even if it exceeds the certified 
value at the time of donation to the project.
    (d) Volunteer services furnished by professional and technical 
personnel, consultants, and other skilled and unskilled labor may be 
counted as cost sharing or matching if the service is an integral and 
necessary part of an approved project or program. Rates for volunteer 
services shall be consistent with those paid for similar work in the 
recipient's organization. In those instances in which the required 
skills are not found in the recipient organization, rates shall be 
consistent with those paid for similar work in the labor market in which 
the recipient competes for the kind of services involved. In either

[[Page 522]]

case, paid fringe benefits that are reasonable, allowable, and allocable 
may be included in the valuation.
    (e) When an employer other than the recipient furnishes the services 
of an employee, these services shall be valued at the employee's regular 
rate of pay (plus an amount of fringe benefits that are reasonable, 
allowable, and allocable, but exclusive of overhead costs), provided 
these services are in the same skill for which the employee is normally 
paid.
    (f) Donated supplies may include such items as expendable equipment, 
office supplies, laboratory supplies or workshop and classroom supplies. 
Value assessed to donated supplies included in the cost sharing or 
matching share shall be reasonable and shall not exceed the fair market 
value of the property at the time of the donation.
    (g) The method used for determining cost sharing or matching for 
donated equipment, buildings and land for which title passes to the 
recipient may differ according to the purpose of the award, if paragraph 
(g) (1) or (2) of this section apply.
    (1) If the purpose of the award is to assist the recipient in the 
acquisition of equipment, buildings or land, the total value of the 
donated property may be claimed as cost sharing or matching.
    (2) If the purpose of the award is to support activities that 
require the use of equipment, buildings or land, normally only 
depreciation or use charges for equipment and buildings may be made. 
However, the full value of equipment or other capital assets and fair 
rental charges for land may be allowed, provided that the Department has 
approved the charges.
    (h) The value of donated property shall be determined in accordance 
with the usual accounting policies of the recipient, with the following 
qualifications.
    (1) The value of donated land and buildings shall not exceed its 
fair market value at the time of donation to the recipient as 
established by an independent appraiser (e.g., certified real property 
appraiser or General Services Administration representative) and 
certified by a responsible official of the recipient.
    (2) The value of donated equipment shall not exceed the fair market 
value of equipment of the same age and condition at the time of 
donation.
    (3) The value of donated space shall not exceed the fair rental 
value of comparable space as established by an independent appraisal of 
comparable space and facilities in a privately-owned building in the 
same locality.
    (4) The value of loaned equipment shall not exceed its fair rental 
value.
    (5) The following requirements pertain to the recipient's supporting 
records for in-kind contributions from third parties.
    (i) Volunteer services shall be documented and, to the extent 
feasible, supported by the same methods used by the recipient for its 
own employees.
    (ii) The basis for determining the valuation for personal service, 
material, equipment, buildings and land shall be documented.



Sec. 145.24  Program income.

    (a) The Department shall apply the standards set forth in this 
section in requiring recipient organizations to account for program 
income related to projects financed in whole or in part with Federal 
funds.
    (b) Except as provided in paragraph (h) of this section, program 
income earned during the project period shall be retained by the 
recipient and, in accordance with the terms and conditions of the award, 
shall be used in one or more of the ways listed in the following.
    (1) Added to funds committed to the project by the Department and 
recipient and used to further eligible project or program objectives.
    (2) Used to finance the non-Federal share of the project or program.
    (3) Deducted from the total project or program allowable cost in 
determining the net allowable costs on which the Federal share of costs 
is based.
    (c) When the award authorizes the disposition of program income as 
described in paragraphs (b)(1) or (b)(2), program income in excess of 
any limits stipulated shall be used in accordance with paragraph (b)(3).

[[Page 523]]

    (d) In the event that the Department does not specify in the terms 
and conditions of the award how program income is to be used, paragraph 
(b)(3) shall apply automatically to all projects or programs except 
research. For awards that support research, paragraph (b)(1) shall apply 
automatically unless the awarding agency indicates in the terms and 
conditions another alternative on the award or the recipient is subject 
to special award conditions, as indicated in Sec. 145.14.
    (e) Unless the terms and conditions of the award provide otherwise, 
recipients shall have no obligation to the Federal Government regarding 
program income earned after the end of the project period.
    (f) If authorized by the terms and conditions of the award, costs 
incident to the generation of program income may be deducted from gross 
income to determine program income, provided these costs have not been 
charged to the award.
    (g) Proceeds from the sale of property shall be handled in 
accordance with the requirements of the Property Standards (See 
Secs. 145.30 through 145.37).
    (h) Unless the terms and condition of the award provide otherwise, 
recipients shall have no obligation to the Federal Government with 
respect to program income earned from license fees and royalties for 
copyrighted material, patents, patent applications, trademarks, and 
inventions produced under an award. However, Patent and Trademark 
Amendments (35 U.S.C. 18) apply to inventions made under an 
experimental, developmental, or research award.



Sec. 145.25  Revision of budget and program plans.

    (a) The budget plan is the financial expression of the project or 
program as approved during the award process. It may include either the 
Federal and non-Federal share, or only the Federal share, depending upon 
Department requirements. It shall be related to performance for program 
evaluation purposes whenever appropriate.
    (b) Recipients are required to report deviations from budget and 
program plans, and request prior approvals for budget and program plan 
revisions, in accordance with this section, unless, at the discretion of 
the Grants Officer, a small percentage variance is allowed by the terms 
of the grant or cooperative agreement.
    (c) For nonconstruction awards, recipients shall request prior 
approvals from the Department for one or more of the following program 
or budget related reasons.
    (1) Change in the scope or the objective of the project or program 
(even if there is no associated budget revision requiring prior written 
approval).
    (2) Change in a key person specified in the application or award 
document.
    (3) The absence for more than three months, or a 25 percent 
reduction in time devoted to the project, by the approved project 
director or principal investigator.
    (4) The need for additional Federal funding.
    (5) The transfer of amounts budgeted for indirect costs to absorb 
increases in direct costs, or vice versa, if approval is required by the 
Department.
    (6) The inclusion, unless waived by the Department, of costs that 
require prior approval in accordance with OMB Circular A-21, ``Cost 
Principles for Institutions of Higher Education,'' OMB Circular A-122, 
``Cost Principles for Non-Profit Organizations,'' or 45 CFR part 74 
appendix E, ``Principles for Determining Costs Applicable to Research 
and Development under Grants and Contracts with Hospitals,'' or 48 CFR 
part 31, ``Contract Cost Principles and Procedures,'' as applicable.
    (7) The transfer of funds allotted for training allowances (direct 
payment to trainees) to other categories of expense.
    (8) Unless described in the application and funded in the approved 
awards, the subaward, transfer or contracting out of any work under an 
award. This provision does not apply to the purchase of supplies, 
material, equipment or general support services.
    (d) No other prior approval requirements for specific items 
described by this regulation may be imposed unless a deviation has been 
approved by OMB.
    (e) Except for requirements listed in paragraphs (c)(1) and (c)(4) 
of this section, Grants Officers are authorized, at their option, to 
waive cost-related and

[[Page 524]]

administrative prior written approvals required by this regulation and 
OMB Circulars A-21 and A-122. Such waivers may include authorizing 
recipients to do any one or more of the following.
    (1) Incur pre-award costs 90 calendar days prior to award or more 
than 90 calendar days with the prior approval of the Department. All 
pre-award costs are incurred at the recipient's risk (i.e., the 
Department is under no obligation to reimburse such costs if for any 
reason the recipient does not receive an award or if the award is less 
than anticipated and inadequate to cover such costs).
    (2) Initiate a one-time extension of the expiration date of the 
award of up to 12 months unless one or more of the following conditions 
apply. For one-time extensions, the recipient must notify the Department 
in writing with the supporting reasons and revised expiration date at 
least 10 days before the expiration date specified in the award. This 
one-time extension may not be exercised merely for the purpose of using 
unobligated balances.
    (i) The terms and conditions of award prohibit the extension.
    (ii) The extension requires additional Federal funds.
    (iii) The extension involves any change in the approved objectives 
or scope of the project.
    (3) Carry forward unobligated balances to subsequent funding 
periods.
    (4) For awards that support research, unless the Department provides 
otherwise in the award, the prior approval requirements described in 
paragraph (e) are automatically waived (i.e., recipients need not obtain 
such prior approvals) unless one of the conditions included in paragraph 
(e)(2) applies.
    (f) The Department may, at its option, restrict the transfer of 
funds among direct cost categories or programs, functions and activities 
for awards in which the Federal share of the project exceeds $100,000 
and the cumulative amount of such transfers exceeds or is expected to 
exceed 10 percent of the total budget as last approved by the Grants 
Officer. Grants Officers shall not permit a transfer that would cause 
any Federal appropriation or part thereof to be used for purposes other 
than those consistent with the original intent of the appropriation.
    (g) All other changes to nonconstruction budgets, except for the 
changes described in paragraph (j), do not require prior approval.
    (h) For construction awards, recipients shall request prior written 
approval promptly from the Grants Officer for budget revisions whenever 
paragraphs (h) (1), (2) or (3) of this section apply.
    (1) The revision results from changes in the scope or the objective 
of the project or program.
    (2) The need arises for additional Federal funds to complete the 
project.
    (3) A revision is desired which involves specific costs for which 
prior written approval requirements may be imposed consistent with 
applicable OMB cost principles listed in Sec. 145.27.
    (i) No other prior approval requirements for specific items may be 
imposed unless a deviation has been approved by OMB.
    (j) When the Department makes an award that provides support for 
both construction and nonconstruction work, the Department may require 
the recipient to request prior approval from the Department before 
making any fund or budget transfers between the two types of work 
supported.
    (k) For both construction and nonconstruction awards, the Department 
shall require recipients to notify the Department in writing promptly 
whenever the amount of Federal authorized funds is expected to exceed 
the needs of the recipient for the project period by more than $5,000 or 
five percent of the Federal award, whichever is greater. This 
notification shall not be required if an application for additional 
funding is submitted for a continuation award.
    (l) When requesting approval for budget revisions, recipients shall 
use the budget forms that were used in the application unless the Grants 
Officer indicates a letter of request suffices.
    (m) Within 30 calendar days from the date of receipt of the request 
for budget revisions, the Grants Officer shall review the request and 
notify the recipient whether the budget revisions have been approved. If 
the revision is still under consideration at the end of 30 calendar 
days, the Grants Officer shall

[[Page 525]]

inform the recipient in writing of the date when the recipient may 
expect the decision.



Sec. 145.26  Non-Federal audits.

    (a) Recipients and subrecipients that are institutions of higher 
education or other non-profit organizations (including hospitals) shall 
be subject to the audit requirements contained in the Single Audit Act 
Amendments of 1996 (31 U.S.C. 7501-7507) and revised OMB Circular A-133, 
``Audits of States, Local Governments, and Non-Profit Organizations.''
    (b) State and local governments shall be subject to the audit 
requirements contained in the Single Audit Act Amendments of 1996 (31 
U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of States, 
Local Governments, and Non-Profit Organizations.''
    (c) For-profit hospitals not covered by the audit provisions of 
revised OMB Circular A-133 shall be subject to the audit requirements of 
the Federal awarding agencies.
    (d) Commercial organizations shall be subject to the audit 
requirements of the Department or the prime recipient as incorporated 
into the award document.
[59 FR 18731, Apr. 20, 1994, as amended at 62 FR 45939, 45941, Aug. 29, 
1997]



Sec. 145.27  Allowable costs.

    For each kind of recipient, there is a set of Federal principles for 
determining allowable costs. Allowability of costs shall be determined 
in accordance with the cost principles applicable to the entity 
incurring the costs. Thus, allowability of costs incurred by State, 
local or federally-recognized Indian tribal governments is determined in 
accordance with the provisions of OMB Circular A-87, ``Cost Principles 
for State and Local Governments.'' The allowability of costs incurred by 
non-profit organizations is determined in accordance with the provisions 
of OMB Circular A-122, ``Cost Principles for Non-Profit Organizations.'' 
The allowability of costs incurred by institutions of higher education 
is determined in accordance with the provisions of OMB Circular A-21, 
``Cost Principles for Educational Institutions.'' The allowability of 
costs incurred by hospitals is determined in accordance with the 
provisions of appendix E of 45 CFR part 74, ``Principles for Determining 
Costs Applicable to Research and Development Under Grants and Contracts 
with Hospitals.'' The allowability of costs incurred by commercial 
organizations and those non-profit organizations listed in Attachment C 
to Circular A-122 is determined in accordance with the provisions of the 
Federal Acquisition Regulation (FAR) at 48 CFR part 31.



Sec. 145.28  Period of availability of funds.

    Where a funding period is specified, a recipient may charge to the 
grant only allowable costs resulting from obligations incurred during 
the funding period and any pre-award costs authorized by the Department, 
unless otherwise provided in the grant or cooperative agreement.

                           Property Standards



Sec. 145.30  Purpose of property standards.

    Sections 145.31 through 145.37 set forth uniform standards governing 
management and disposition of property furnished by the Federal 
Government whose cost was charged to a project supported by a Federal 
award. The Department shall require recipients to observe these 
standards under awards and shall not impose additional requirements, 
unless specifically required by Federal statute. The recipient may use 
its own property management standards and procedures provided it 
observes the provisions of Secs. 145.31 through 145.37.



Sec. 145.31  Insurance coverage.

    Recipients shall, at a minimum, provide the equivalent insurance 
coverage for real property and equipment acquired with Federal funds as 
provided to property owned by the recipient. Federally-owned property 
need not be insured unless required by the terms and conditions of the 
award.



Sec. 145.32  Real property.

    Each award shall prescribe any applicable requirements for 
recipients concerning the use and disposition of real property acquired 
in whole or in part

[[Page 526]]

under awards. Unless otherwise provided by statute, such requirements, 
at a minimum, shall contain the following:
    (a) Title to real property shall vest in the recipient subject to 
the condition that the recipient shall use the real property for the 
authorized purpose of the project as long as it is needed and shall not 
encumber the property without approval of the Department.
    (b) The recipient shall obtain written approval by the Department 
for the use of real property in other Federally-sponsored projects when 
the recipient determines that the property is no longer needed for the 
purpose of the original project. Use in other projects shall be limited 
to those under Federally-sponsored projects (i.e., awards) or programs 
that have purposes consistent with those authorized for support by the 
Department.
    (c) When the real property is no longer needed as provided in 
paragraphs (a) and (b), the recipient shall request disposition 
instructions from the cognizant Grants Officer. The Department shall 
observe one or more of the following disposition instructions.
    (1) The recipient may be permitted to retain title without further 
obligation to the Federal Government after it compensates the Federal 
Government for that percentage of the current fair market value of the 
property attributable to the Federal participation in the project.
    (2) The recipient may be directed to sell the property under 
guidelines provided by the Department and pay the Federal Government for 
that percentage of the current fair market value of the property 
attributable to the Federal participation in the project (after 
deducting actual and reasonable selling and fix-up expenses, if any, 
from the sales proceeds). When the recipient is authorized or required 
to sell the property, proper sales procedures shall be established that 
provide for competition to the extent practicable and result in the 
highest possible return.
    (3) The recipient may be directed to transfer title to the property 
to the Federal Government or to an eligible third party provided that, 
in such cases, the recipient shall be entitled to compensation for its 
attributable percentage of the current fair market value of the 
property.



Sec. 145.33  Federally-owned and exempt property.

    (a) Federally-owned property. (1) Title to Federally-owned property 
remains vested in the Federal Government. Recipients shall submit 
annually an inventory listing of Federally-owned property in their 
custody to the Department. Upon completion of the award or when the 
property is no longer needed, the recipient shall report the property to 
the Department for further Federal agency utilization.
    (2) If the Department has no further need for the property, it shall 
be declared excess and reported to the General Services Administration, 
unless the Department has statutory authority to dispose of the property 
by alternative methods (e.g., the authority provided by the Federal 
Technology Transfer Act (15 U.S.C. 3710 (I)) to donate research 
equipment to educational and non-profit organizations in accordance with 
Executive Order 12821, ``Improving Mathematics and Science Education in 
Support of the National Education Goals.'') Appropriate instructions 
shall be issued to the recipient by the Department.
    (b) Exempt property. When statutory authority exists, the Department 
has the option to vest title to property acquired with Federal funds in 
the recipient without further obligation to the Federal Government and 
under conditions the Department considers appropriate. Such property is 
``exempt property.'' Should the Department not establish conditions, 
title to exempt property upon acquisition shall vest in the recipient 
without further obligation to the Federal Government.



Sec. 145.34  Equipment.

    (a) Title to equipment acquired by a recipient with Federal funds 
shall vest in the recipient, subject to conditions of this section.
    (b) The recipient shall not use equipment acquired with Federal 
funds to provide services to non-Federal outside organizations for a fee 
that is less than private companies charge for equivalent services, 
unless specifically authorized by Federal statute, for as long

[[Page 527]]

as the Federal Government retains an interest in the equipment.
    (c) The recipient shall use the equipment in the project or program 
for which it was acquired as long as needed, whether or not the project 
or program continues to be supported by Federal funds and shall not 
encumber the property without approval of the Department. When no longer 
needed for the original project or program, the recipient shall use the 
equipment in connection with its other federally-sponsored activities, 
in the following order of priority: First, Activities sponsored by the 
Department which funded the original project, then activities sponsored 
by other the Department.
    (d) During the time that equipment is used on the project or program 
for which it was acquired, the recipient shall make it available for use 
on other projects or programs if such other use will not interfere with 
the work on the project or program for which the equipment was 
originally acquired. First preference for such other use shall be given 
to other projects or programs sponsored by the Department that financed 
the equipment; second preference shall be given to projects or programs 
sponsored by other the Department. If the equipment is owned by the 
Federal Government, use on other activities not sponsored by the Federal 
Government shall be permissible if authorized by the Department. User 
charges shall be treated as program income.
    (e) When acquiring replacement equipment, the recipient may use the 
equipment to be replaced as trade-in or sell the equipment and use the 
proceeds to offset the costs of the replacement equipment subject to the 
approval of the Department.
    (f) The recipient's property management standards for equipment 
acquired with Federal funds and Federally-owned equipment shall include 
all of the following.
    (1) Equipment records shall be maintained accurately and shall 
include the following information.
    (i) A description of the equipment.
    (ii) Manufacturer's serial number, model number, Federal stock 
number, national stock number, or other identification number.
    (iii) Source of the equipment, including the award number.
    (iv) Whether title vests in the recipient or the Federal Government.
    (v) Acquisition date (or date received, if the equipment was 
furnished by the Federal Government) and cost.
    (vi) Information from which one can calculate the percentage of 
Federal participation in the cost of the equipment (not applicable to 
equipment furnished by the Federal Government).
    (vii) Location and condition of the equipment and the date the 
information was reported.
    (viii) Unit acquisition cost.
    (ix) Ultimate disposition data, including date of disposal and sales 
price or the method used to determine current fair market value where a 
recipient compensates the Department for its share.
    (2) Equipment owned by the Federal Government shall be identified to 
indicate Federal ownership.
    (3) A physical inventory of equipment shall be taken and the results 
reconciled with the equipment records at least once every two years. Any 
differences between quantities determined by the physical inspection and 
those shown in the accounting records shall be investigated to determine 
the causes of the difference. The recipient shall, in connection with 
the inventory, verify the existence, current utilization, and continued 
need for the equipment.
    (4) A control system shall be in effect to insure adequate 
safeguards to prevent loss, damage, or theft of the equipment. Any loss, 
damage, or theft of equipment shall be investigated and fully 
documented; if the equipment was owned by the Federal Government, the 
recipient shall promptly notify the Department.
    (5) Adequate maintenance procedures shall be implemented to keep the 
equipment in good condition.
    (6) Where the recipient is authorized or required to sell the 
equipment, proper sales procedures shall be established which provide 
for competition to the extent practicable and result in the highest 
possible return.
    (g) When the recipient no longer needs the equipment, the equipment

[[Page 528]]

may be used for other activities in accordance with the following 
standards. For equipment with a current per unit fair market value of 
$5,000 or more, the recipient may retain the equipment for other uses 
provided that compensation is made to the original agency or its 
successor. The amount of compensation shall be computed by applying the 
percentage of Federal participation in the cost of the original project 
or program to the current fair market value of the equipment. If the 
recipient has no need for the equipment, the recipient shall request 
disposition instructions from the Department. The Department shall 
determine whether the equipment can be used to meet the agency's 
requirements. If no requirement exists within that agency, the 
availability of the equipment shall be reported to the General Services 
Administration by the Department to determine whether a requirement for 
the equipment exists in other Federal agencies. The Department shall 
issue instructions to the recipient no later than 120 calendar days 
after the recipient's request and the following procedures shall govern.
    (1) If so instructed or if disposition instructions are not issued 
within 120 calendar days after the recipient's request, the recipient 
shall sell the equipment and reimburse the Department an amount computed 
by applying to the sales proceeds the percentage of Federal 
participation in the cost of the original project or program. However, 
the recipient shall be permitted to deduct and retain from the Federal 
share $500 or ten percent of the proceeds, whichever is less, for the 
recipient's selling and handling expenses.
    (2) If the recipient is instructed to ship the equipment elsewhere, 
the recipient shall be reimbursed by the Federal Government by an amount 
which is computed by applying the percentage of the recipient's 
participation in the cost of the original project or program to the 
current fair market value of the equipment, plus any reasonable shipping 
or interim storage costs incurred.
    (3) If the recipient is instructed to otherwise dispose of the 
equipment, the recipient shall be reimbursed by the Department for such 
costs incurred in its disposition.
    (4) The Department may reserve the right to transfer the title to 
the Federal Government or to a third party named by the Federal 
Government when such third party is otherwise eligible under existing 
statutes. Such transfer shall be subject to the following standards.
    (i) The equipment shall be appropriately identified in the award or 
otherwise made known to the recipient in writing.
    (ii) The Department shall issue disposition instructions within 120 
calendar days after receipt of a final inventory. The final inventory 
shall list all equipment acquired with grant funds and federally-owned 
equipment. If the Department fails to issue disposition instructions 
within the 120 calendar day period, the recipient shall apply the 
standards of this section, as appropriate.
    (iii) When the Department exercises its right to take title, the 
equipment shall be subject to the provisions for federally-owned 
equipment.



Sec. 145.35  Supplies and other expendable property.

    (a) Title to supplies and other expendable property shall vest in 
the recipient upon acquisition. If there is a residual inventory of 
unused supplies exceeding $5,000 in total aggregate value upon 
termination or completion of the project or program and the supplies are 
not needed for any other Federally-sponsored project or program, the 
recipient shall retain the supplies for use on non-Federal sponsored 
activities or sell them, but shall, in either case, compensate the 
Federal Government for its share. The amount of compensation shall be 
computed in the same manner as for equipment.
    (b) The recipient shall not use supplies acquired with Federal funds 
to provide services to non-Federal outside organizations for a fee that 
is less than private companies charge for equivalent services, unless 
specifically authorized by Federal statute as long as the Federal 
Government retains an interest in the supplies.

[[Page 529]]



Sec. 145.36  Intangible property.

    (a) The recipient may copyright any work that is subject to 
copyright and was developed, or for which ownership was purchased, under 
an award. The Department reserves a royalty-free, nonexclusive and 
irrevocable right to reproduce, publish, or otherwise use the work for 
Federal purposes, and to authorize others to do so.
    (b) Recipients are subject to applicable regulations governing 
patents and inventions, including government-wide regulations issued by 
the Department of Commerce at 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and Small Business Firms Under 
Government Grants, Contracts and Cooperative Agreements.''
    (c) Unless waived by the Department, the Federal Government has the 
right to:
    (1) Obtain, reproduce, publish or otherwise use the data first 
produced under an award.
    (2) Authorize others to receive, reproduce, publish, or otherwise 
use such data for Federal purposes.
    (d) Title to intangible property and debt instruments acquired under 
an award or subaward vests upon acquisition in the recipient. The 
recipient shall use that property for the originally-authorized purpose, 
and the recipient shall not encumber the property without approval of 
the Department. When no longer needed for the originally authorized 
purpose, disposition of the intangible property shall occur in 
accordance with the provisions of Sec. 145.34(g).



Sec. 145.37  Property trust relationship.

    Real property, equipment, intangible property and debt instruments 
that are acquired or improved with Federal funds shall be held in trust 
by the recipient as trustee for the beneficiaries of the project or 
program under which the property was acquired or improved. Agencies may 
require recipients to record liens or other appropriate notices of 
record to indicate that personal or real property has been acquired or 
improved with Federal funds and that use and disposition conditions 
apply to the property.

                          Procurement Standards



Sec. 145.40  Purpose of procurement standards.

    Sections 145.41 through 145.48 set forth standards for use by 
recipients in establishing procedures for the procurement of supplies 
and other expendable property, equipment, real property and other 
services with Federal funds. These standards are furnished to ensure 
that such materials and services are obtained in an effective manner and 
in compliance with the provisions of applicable Federal statutes and 
executive orders. No additional procurement standards or requirements 
shall be imposed by the Department upon recipients, unless specifically 
required by Federal statute or executive order or approved by OMB. The 
standards in Secs. 145.1 through 145.48 do not apply to small awards, 
except where imposed by Federal statute or Executive Order.



Sec. 145.41  Recipient responsibilities.

    The standards contained in this section do not relieve the recipient 
of the contractual responsibilities arising under its contract(s). The 
recipient is the responsible authority, without recourse to the 
Department, regarding the settlement and satisfaction of all contractual 
and administrative issues arising out of procurements entered into in 
support of an award or other agreement. This includes disputes, claims, 
protests of award, source evaluation or other matters of a contractual 
nature. Matters concerning violation of statute are to be referred to 
such Federal, State or local authority as may have proper jurisdiction.



Sec. 145.42  Code of conduct.

    The recipient shall maintain written standards of conduct governing 
the performance of its employees engaged in the award and administration 
of contracts. No employee, officer, or agent shall participate in the 
selection, award, or administration of a contract supported by Federal 
funds if a real or apparent conflict of interest would be involved. Such 
a conflict would arise when the employee, officer, or agent, any member 
of his or her immediate family, his or her partner, or an organization 
which employs or is about to

[[Page 530]]

employ any of the parties indicated herein, has a financial or other 
interest in the firm selected for an award. The officers, employees, and 
agents of the recipient shall neither solicit nor accept gratuities, 
favors, or anything of monetary value from contractors, or parties to 
subagreements. However, recipients may set standards for situations in 
which the financial interest is not substantial or the gift is an 
unsolicited item of nominal value. The standards of conduct shall 
provide for disciplinary actions to be applied for violations of such 
standards by officers, employees, or agents of the recipient.



Sec. 145.43  Competition.

    All procurement transactions shall be conducted in a manner to 
provide, to the maximum extent practical, open and free competition. The 
recipient shall be alert to organizational conflicts of interest as well 
as noncompetitive practices among contractors that may restrict or 
eliminate competition or otherwise restrain trade. In order to ensure 
objective contractor performance and eliminate unfair competitive 
advantage, contractors that develop or draft specifications, 
requirements, statements of work, invitations for bids and/or requests 
for proposals shall be excluded from competing for such procurements. 
Awards shall be made to the bidder or offeror whose bid or offer is 
responsive to the solicitation and is most advantageous to the 
recipient, price, quality and other factors considered. Solicitations 
shall clearly set forth all requirements that the bidder or offeror 
shall fulfill in order for the bid or offer to be evaluated by the 
recipient. Any and all bids or offers may be rejected when it is in the 
recipient's interest to do so.



Sec. 145.44  Procurement procedures.

    (a) All recipients shall establish written procurement procedures. 
These procedures shall provide for, at a minimum, that paragraphs 
(a)(1), (2) and (3) of this section apply.
    (1) Recipients avoid purchasing unnecessary items.
    (2) Where appropriate, an analysis is made of lease and purchase 
alternatives to determine which would be the most economical and 
practical procurement for the Federal Government.
    (3) Solicitations for goods and services provide for all of the 
following:
    (i) A clear and accurate description of the technical requirements 
for the material, product or service to be procured. In competitive 
procurements, such a description shall not contain features which unduly 
restrict competition.
    (ii) Requirements which the bidder/offeror must fulfill and all 
other factors to be used in evaluating bids or proposals.
    (iii) A description, whenever practicable, of technical requirements 
in terms of functions to be performed or performance required, including 
the range of acceptable characteristics or minimum acceptable standards.
    (iv) The specific features of ``brand name or equal'' descriptions 
that bidders are required to meet when such items are included in the 
solicitation.
    (v) The acceptance, to the extent practicable and economically 
feasible, of products and services dimensioned in the metric system of 
measurement.
    (vi) Preference, to the extent practicable and economically 
feasible, for products and services that conserve natural resources and 
protect the environment and are energy efficient.
    (b) Positive efforts shall be made by recipients to utilize small 
businesses, minority-owned firms, and women's business enterprises, 
whenever possible. Recipients of Federal awards shall take all of the 
following steps to further this goal.
    (1) Ensure that small businesses, minority-owned firms, and women's 
business enterprises are used to the fullest extent practicable.
    (2) Make information on forthcoming opportunities available and 
arrange time frames for purchases and contracts to encourage and 
facilitate participation by small businesses, minority-owned firms, and 
women's business enterprises.
    (3) Consider in the contract process whether firms competing for 
larger contracts intend to subcontract with small businesses, minority-
owned firms, and women's business enterprises.

[[Page 531]]

    (4) Encourage contracting with consortiums of small businesses, 
minority-owned firms and women's business enterprises when a contract is 
too large for one of these firms to handle individually.
    (5) Use the services and assistance, as appropriate, of such 
organizations as the Small Business Administration and the Department of 
Commerce's Minority Business Development Agency in the solicitation and 
utilization of small businesses, minority-owned firms and women's 
business enterprises.
    (c) The type of procurement instruments used (e.g., fixed price 
contracts, cost reimbursement contracts, purchase orders, and incentive 
contracts) shall be determined by the recipient but shall be appropriate 
for the particular procurement and for promoting the best interest of 
the program or project involved. The ``cost-plus-a-percentage-of-cost'' 
or ``percentage of construction cost'' methods of contracting shall not 
be used.
    (d) Contracts shall be awarded only to responsible contractors who 
possess the potential ability to perform successfully under the terms 
and conditions of the proposed procurement. Consideration shall be given 
to such matters as contractor integrity, record of past performance, 
financial and technical resources or accessibility to other necessary 
resources. In certain circumstances, contracts with certain parties are 
restricted by implementation of E.O.s 12549 and 12689, ``Debarment and 
Suspension,'' implemented at 22 CFR 137.
    (e) Recipients shall, on request, make available for the Department, 
pre-award review and procurement documents, such as request for 
proposals or invitations for bids, independent cost estimates, etc., 
when any of the following conditions apply.
    (1) A recipient's procurement procedures or operation fails to 
comply with the procurement standards in the Department's implementation 
of this regulation.
    (2) The procurement is expected to exceed the small purchase 
limitation and is to be awarded without competition or only one bid or 
offer is received in response to a solicitation.
    (3) The procurement, which is expected to exceed the small purchase 
limitation, specifies a ``brand name'' product.
    (4) The proposed award over the small purchase limitation is to be 
awarded to other than the apparent low bidder under a sealed bid 
procurement.
    (5) A proposed contract modification changes the scope of a contract 
or increases the contract amount by more than the amount of the small 
purchase limitation.



Sec. 145.45  Cost and price analysis.

    Some form of cost or price analysis shall be made and documented in 
the procurement files in connection with every procurement action. Price 
analysis may be accomplished in various ways, including the comparison 
of price quotations submitted, market prices and similar indicia, 
together with discounts. Cost analysis is the review and evaluation of 
each element of cost to determine reasonableness, allocability and 
allowability.



Sec. 145.46  Procurement records.

    Procurement records and files for purchases in excess of the small 
purchase limitation shall include the following at a minimum:
    (a) basis for contractor selection,
    (b) justification for lack of competition when competitive bids or 
offers are not obtained, and
    (c) basis for award cost or price.



Sec. 145.47  Contract administration.

    A system for contract administration shall be maintained to ensure 
contractor conformance with the terms, conditions and specifications of 
the contract and to ensure adequate and timely follow up of all 
purchases. Recipients shall evaluate contractor performance and 
document, as appropriate, whether contractors have met the terms, 
conditions and specifications of the contract.



Sec. 145.48  Contract clauses.

    The recipient shall include, in addition to clauses to define a 
sound and complete agreement, the following clauses in all contracts. 
The following

[[Page 532]]

clauses shall also be applied to subcontracts.
    (a) Contracts in excess of the small purchase limitation shall 
contain contract clauses that allow for administrative, contractual, or 
legal remedies in instances in which a contractor violates or breaches 
the contract terms, and provide for such remedial actions as may be 
appropriate.
    (b) All contracts in excess of the small purchase limitation shall 
contain suitable clauses for termination by the recipient, including the 
manner by which termination shall be effected and the basis for 
settlement. The clauses shall describe conditions under which the 
contract may be terminated by the recipient for default of the 
contractor as well as conditions where the contract may be terminated 
for convenience because of circumstances beyond the control of the 
contractor.
    (c) Except as otherwise required by statute, an award that requires 
the contracting (or subcontracting) for construction or facility 
improvements shall provide for the recipient to follow its own 
requirements relating to bid guarantees, performance bonds, and payment 
bonds unless the construction contract or subcontract exceeds $100,000. 
For those contracts or subcontracts exceeding $100,000, the Department 
may accept the bonding policy and requirements of the recipient, 
provided the Department has made a determination that the Federal 
Government's interest is adequately protected. If such a determination 
has not been made, the minimum requirements shall be as follows.
    (1) A bid guarantee from each bidder equivalent to five percent of 
the bid price. The ``bid guarantee'' shall consist of a firm commitment 
such as a bid bond, certified check, or other negotiable instrument 
accompanying a bid as assurance that the bidder shall, upon acceptance 
of his bid, execute such contractual documents as may be required within 
the time specified.
    (2) A performance bond on the part of the contractor for 100 percent 
of the contract price or other amount approved by the Grants Officer. A 
``performance bond'' is one executed in connection with a contract to 
secure fulfillment of all the contractor's obligations under such 
contract.
    (3) A payment bond on the part of the contractor for 100 percent of 
the contract price. A ``payment bond'' is one executed in connection 
with a contract to assure payment as required by statute of all persons 
supplying labor and material in the execution of the work provided for 
in the contract.
    (4) Where bonds are required in the situations described herein, the 
bonds shall be obtained from companies holding certificates of authority 
as acceptable sureties pursuant to 31 CFR part 223, ``Surety Companies 
Doing Business with the United States.''
    (d) All negotiated contracts (except those for less than the small 
purchase limitation) awarded by recipients shall include a provision to 
the effect that the recipient, the Department, the Comptroller General 
of the United States, or any of their duly authorized representatives, 
shall have access to any books, documents, papers and records of the 
contractor which are directly pertinent to a specific program for the 
purpose of making audits, examinations, excerpts and transcriptions.
    (e) All contracts, including small purchases, awarded by recipients 
and their contractors shall contain the contract clauses in appendix A 
to this regulation, as applicable.

                           Reports and Records



Sec. 145.50  Purpose of reports and records.

    Sections 145.51 through 145.53 set forth the procedures for 
monitoring and reporting on the recipient's financial and program 
performance and the necessary standard reporting forms. They also set 
forth record retention requirements.



Sec. 145.51  Monitoring and reporting program performance.

    (a) Recipients are responsible for managing and monitoring each 
project, program, subaward, function or activity supported by the award. 
Recipients shall monitor subawards to ensure subrecipients have met the 
audit requirements as delineated in Sec. 145.26.

[[Page 533]]

    (b) The Department shall prescribe the frequency with which the 
performance reports shall be submitted. Except as provided in 
Sec. 145.51(f), performance reports shall not be required more 
frequently than quarterly or, less frequently than annually. Annual 
reports shall be due 90 calendar days after the grant year; quarterly or 
semi-annual reports shall be due 30 days after the reporting period. The 
Department may require annual reports before the anniversary dates of 
multiple year awards in lieu of these requirements. The final 
performance reports are due 90 calendar days after the expiration or 
termination of the award.
    (c) If inappropriate, a final technical or performance report shall 
not be required after completion of the project.
    (d) When required, performance reports shall generally contain, for 
each award, brief information on each of the following.
    (1) A comparison of actual accomplishments with the goals and 
objectives established for the period, the findings of the investigator, 
or both. Whenever appropriate and the output of programs or projects can 
be readily quantified, such quantitative data should be related to cost 
data for computation of unit costs.
    (2) Reasons why established goals were not met, if appropriate.
    (3) Other pertinent information including, when appropriate, 
analysis and explanation of cost overruns or high unit costs.
    (e) Recipients shall not be required to submit more than the 
original and two copies of performance reports.
    (f) Recipients shall immediately notify the Department of 
developments that have a significant impact on the award-supported 
activities. Also, notification shall be given in the case of problems, 
delays, or adverse conditions which materially impair the ability to 
meet the objectives of the award. This notification shall include a 
statement of the action taken or contemplated, and any assistance needed 
to resolve the situation.
    (g) The Department may make site visits, as needed.
    (h) The Department shall comply with clearance requirements of 5 CFR 
part 1320 when requesting performance data from recipients.



Sec. 145.52  Financial reporting.

    (a) The following forms or such other forms as may be approved by 
OMB are authorized for obtaining financial information from recipients.

             (1) SF-269 or SF-269A, Financial Status Report

    (i) The Department shall require recipients to use the SF-269 or SF-
269A to report the status of funds for all nonconstruction projects or 
programs, unless an equivalent form has been prescribed by the Grants 
Officer and approved by the OMB and the Office of the Procurement 
Executive (A/OPE), e.g., Form JF-61 for the Office of Overseas Schools 
(A/OPR/OS). The Department may also have the option of not requiring the 
SF-269 or SF-269A when the SF-270, Request for Advance or Reimbursement, 
or SF-272, Report of Federal Cash Transactions, is determined to provide 
adequate information to meet its needs, except that a final SF-269 or 
SF-269A shall be required at the completion of the project when the SF-
270 is used only for advances.
    (ii) The Grants Officer shall prescribe whether the report shall be 
on a cash or accrual basis. If the Department requires accrual 
information and the recipient's accounting records are not normally kept 
on the accrual basis, the recipient shall not be required to convert its 
accounting system, but shall develop such accrual information through 
best estimates based on an analysis of the documentation on hand.
    (iii) The Department shall determine the frequency of the Financial 
Status Report for each project or program, considering the size and 
complexity of the particular project or program. However, the report 
shall not be required more frequently than quarterly or less frequently 
than annually. A final report shall be required at the completion of the 
agreement.
    (iv) The Department shall require recipients to submit the SF-269 or 
SF-269A (an original and no more than two copies) no later than 30 days 
after the end of each specified reporting period for quarterly and semi-
annual reports, and 90 calendar days for annual and

[[Page 534]]

final reports. Extensions of reporting due dates may be approved by the 
Department upon request of the recipient.

             (2) SF-272, Report of Federal Cash Transactions

    (i) When funds are advanced to recipients the Department shall 
require each recipient to submit the SF-272 and, when necessary, its 
continuation sheet, SF-272a. The Department shall use this report to 
monitor cash advanced to recipients and to obtain disbursement 
information for each agreement with the recipients.
    (ii) The Department may require forecasts of Federal cash 
requirements in the ``Remarks'' section of the report.
    (iii) When practical and deemed necessary, the Department may 
require recipients to report in the ``Remarks'' section the amount of 
cash advances received in excess of three days. Recipients shall provide 
short narrative explanations of actions taken to reduce the excess 
balances.
    (iv) Recipients shall be required to submit not more than the 
original and two copies of the SF-272 15 calendar days following the end 
of each quarter. The Department may require a monthly report from those 
recipients receiving advances totaling $1 million or more per year.
    (v) The Grants Officer may waive the requirement for submission of 
the SF-272 for any one of the following reasons:
    (A) When monthly advances do not exceed $25,000 per recipient, 
provided that such advances are monitored through other forms contained 
in this section;
    (B) If, in the Grants Officer's opinion, the recipient's accounting 
controls are adequate to minimize excessive Federal advances; or
    (C) When the electronic payment mechanisms provide adequate data.
    (b) When the Department needs additional information or more 
frequent reports, the following shall be observed.
    (1) When additional information is needed to comply with legislative 
requirements, the Department shall issue instructions to require 
recipients to submit such information under the ``Remarks'' section of 
the reports.
    (2) When the Department determines that a recipient's accounting 
system does not meet the standards in Sec. 145.21, additional pertinent 
information to further monitor awards may be obtained upon written 
notice to the recipient until such time as the system is brought up to 
standard. The Department, in obtaining this information, shall comply 
with report clearance requirements of 5 CFR part 1320.
    (3) The Grants Officer may ``shade out'' any line item on any report 
if not necessary.
    (4) The Department may accept the identical information from the 
recipients in machine readable format or computer printouts or 
electronic outputs in lieu of prescribed formats.
    (5) The Department may provide computer or electronic outputs to 
recipients when such expedites or contributes to the accuracy of 
reporting.



Sec. 145.53  Retention and access requirements for records.

    (a) This section sets forth requirements for record retention and 
access to records for awards to recipients. The Department shall not 
impose any other record retention or access requirements upon 
recipients.
    (b) Financial records, supporting documents, statistical records, 
and all other records pertinent to an award shall be retained for a 
period of three years from the date of submission of the final 
expenditure report or, for awards that are renewed quarterly or 
annually, from the date of the submission of the quarterly or annual 
financial report, as authorized by the Department. The only exceptions 
are the following.
    (1) If any litigation, claim, or audit is started before the 
expiration of the 3-year period, the records shall be retained until all 
litigation, claims or audit findings involving the records have been 
resolved and final action taken.
    (2) Records for real property and equipment acquired with Federal 
funds shall be retained for 3 years after final disposition.
    (3) When records are transferred to or maintained by the Department, 
the 3-year retention requirement is not applicable to the recipient.

[[Page 535]]

    (4) Indirect cost rate proposals, cost allocations plans, etc. as 
specified in Sec. 145.53(g).
    (c) Copies of original records may be substituted for the original 
records if authorized by the Department.
    (d) The Department shall request transfer of certain records to its 
custody from recipients when it determines that the records possess long 
term retention value. However, in order to avoid duplicate 
recordkeeping, the Department may make arrangements for recipients to 
retain any records that are continuously needed for joint use.
    (e) The Department, the Inspector General, Comptroller General of 
the United States, or any of their duly authorized representatives, have 
the right of timely and unrestricted access to any books, documents, 
papers, or other records of recipients that are pertinent to the awards, 
in order to make audits, examinations, excerpts, transcripts and copies 
of such documents. This right also includes timely and reasonable access 
to a recipient's personnel for the purpose of interview and discussion 
related to such documents. The rights of access in this paragraph are 
not limited to the required retention period, but shall last as long as 
records are retained.
    (f) Unless required by statute, no Department shall place 
restrictions on recipients that limit public access to the records of 
recipients that are pertinent to an award, except when the Department 
can demonstrate that such records shall be kept confidential and would 
have been exempted from disclosure pursuant to the Freedom of 
Information Act (5 U.S.C. 552) if the records had belonged to the 
Department.
    (g) Indirect cost rate proposals, cost allocations plans, etc. 
Paragraphs (g)(1) and (g)(2) apply to the following types of documents, 
and their supporting records: Indirect cost rate computations or 
proposals, cost allocation plans, and any similar accounting 
computations of the rate at which a particular group of costs is 
chargeable (such as computer usage chargeback rates or composite fringe 
benefit rates).
    (1) If submitted for negotiation. If the recipient submits to the 
Department or the subrecipient submits to the recipient the proposal, 
plan, or other computation to form the basis for negotiation of the 
rate, then the 3-year retention period for its supporting records starts 
on the date of such submission.
    (2) If not submitted for negotiation. If the recipient is not 
required to submit to the Department or the subrecipient is not required 
to submit to the recipient the proposal, plan, or other computation for 
negotiation purposes, then the 3-year retention period for the proposal, 
plan, or other computation and its supporting records starts at the end 
of the fiscal year (or other accounting period) covered by the proposal, 
plan, or other computation.

                       Termination and Enforcement



Sec. 145.60  Purpose of termination and enforcement.

    Sections 145.61 and 145.62 set forth uniform suspension, termination 
and enforcement procedures.



Sec. 145.61  Termination.

    (a) Awards may be terminated in whole or in part only if paragraphs 
(a) (1), (2) or (3) of this section apply.
    (1) By the Department, if a recipient materially fails to comply 
with the terms and conditions of an award.
    (2) By the Department, with the consent of the recipient, in which 
case the two parties shall agree upon the termination conditions, 
including the effective date and, in the case of partial termination, 
the portion to be terminated.
    (3) By the recipient, upon sending to the Department written 
notification setting forth the reasons for such termination, the 
effective date, and, in the case of partial termination, the portion to 
be terminated. However, if the Department determines in the case of 
partial termination that the reduced or modified portion of the grant 
will not accomplish the purposes for which the grant was made, it may 
terminate the grant in its entirety under either paragraphs (a) (1) or 
(2).
    (b) If costs are allowed under an award, the responsibilities of the 
recipient referred to in Sec. 145.71(a), including

[[Page 536]]

those for property management as applicable, shall be considered in the 
termination of the award, and provision shall be made for continuing 
responsibilities of the recipient after termination, as appropriate.



Sec. 145.62  Enforcement.

    (a) Remedies for noncompliance. If a recipient materially fails to 
comply with the terms and conditions of an award, whether stated in a 
Federal statute, regulation, assurance, application, or notice of award, 
the Department may, in addition to imposing any of the special 
conditions outlined in Sec. 145.14, take one or more of the following 
actions, as appropriate in the circumstances.
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the recipient or more severe enforcement action by the 
Department.
    (2) Disallow (that is, deny both use of funds and any applicable 
matching credit for) all or part of the cost of the activity or action 
not in compliance.
    (3) Wholly or partly suspend or terminate the current award.
    (4) Withhold further awards for the project or program.
    (5) Take other remedies that may be legally available.
    (b) Hearings and appeals. In taking an enforcement action, the 
awarding agency shall provide the recipient an opportunity for hearing, 
appeal, or other administrative proceeding to which the recipient is 
entitled under any statute or regulation applicable to the action 
involved.
    (c) Effects of suspension and termination. Costs of a recipient 
resulting from obligations incurred by the recipient during a suspension 
or after termination of an award are not allowable unless the awarding 
agency expressly authorizes them in the notice of suspension or 
termination or subsequently. Other recipient costs during suspension or 
after termination which are necessary and not reasonably avoidable are 
allowable if paragraphs (c) (1) and (2) of this section apply.
    (1) The costs result from obligations which were properly incurred 
by the recipient before the effective date of suspension or termination, 
are not in anticipation of it, and in the case of a termination, are 
noncancellable.
    (2) The costs would be allowable if the award were not suspended or 
expired normally at the end of the funding period in which the 
termination takes effect.
    (d) Relationship to debarment and suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude a recipient from being subject to debarment 
and suspension under Executive Orders 12549 and 12689 and the 
implementing regulations at 22 CFR part 137.



                 Subpart D--After-the-Award Requirements



Sec. 145.70  Purpose.

    Sections 145.71 through 145.73 contain closeout procedures and other 
procedures for subsequent disallowances and adjustments.



Sec. 145.71  Closeout procedures.

    (a) Recipients shall submit, within 90 calendar days after the date 
of completion of the award, all financial, performance, and other 
reports as required by the terms and conditions of the award. The Grants 
Officer may approve extensions when requested by the recipient.
    (b) Unless the Grants Officer authorizes an extension, a recipient 
shall liquidate all obligations incurred under the award not later than 
90 calendar days after the funding period or the date of completion as 
specified in the terms and conditions of the award.
    (c) The Department shall make prompt payments to a recipient for 
allowable reimbursable costs under the award being closed out.
    (d) The recipient shall promptly refund any balances of unobligated 
cash that the Department has advanced or paid and that is not authorized 
to be retained by the recipient for use in other projects. OMB Circular 
A-129 governs unreturned amounts that become delinquent debts.
    (e) When authorized by the terms and conditions of the award, the 
Department shall make a settlement for any upward or downward 
adjustments to the Federal share of costs after closeout reports are 
received.

[[Page 537]]

    (f) The recipient shall account for any real and personal property 
acquired with Federal funds or received from the Federal Government in 
accordance with Secs. 145.31 through 145.37.
    (g) In the event a final audit has not been performed prior to the 
closeout of an award, the Department shall retain the right to recover 
an appropriate amount after fully considering the recommendations on 
disallowed costs resulting from the final audit.



Sec. 145.72  Subsequent adjustments and continuing responsibilities.

    (a) The closeout of an award does not affect any of the following:
    (1) The right of the Department to disallow costs and recover funds 
on the basis of a later audit or other review.
    (2) The obligation of the recipient to return any funds due as a 
result of later refunds, corrections, or other transactions.
    (3) Audit requirements in Sec. 145.26.
    (4) Property management requirements in Secs. 145.31 through 145.37.
    (5) Records retention as required in Sec. 145.53.
    (b) After closeout of an award, a relationship created under an 
award may be modified or ended in whole or in part with the consent of 
the Department and the recipient, provided the responsibilities of the 
recipient referred to in Sec. 145.73(a), including those for property 
management as applicable, are considered and provisions made for 
continuing responsibilities of the recipient, as appropriate.



Sec. 145.73  Collection of amounts due.

    (a) Any funds paid to a recipient in excess of the amount to which 
the recipient is finally determined to be entitled under the terms and 
conditions of the award constitute a debt to the Federal Government. If 
not paid within a reasonable period after the demand for payment, the 
Department may reduce the debt by:
    (1) Making an administrative offset against other requests for 
reimbursements.
    (2) Withholding advance payments otherwise due to the recipient.
    (3) Taking other action permitted by statute.
    (b) Except as otherwise provided by law, the Department shall charge 
interest on an overdue debt in accordance with 4 CFR Chapter II, Federal 
Claims Collection Standards.

   Appendix A to Part 145--Clauses for Contracts and Small Purchases 
                          Awarded by Recipient

    All contracts and small purchases, awarded by a recipient who is 
subject to this regulation, shall contain the following clauses, as 
applicable:
    1. Equal Employment Opportunity--All contracts shall contain a 
clause requiring compliance with Executive Order 11246, ``Equal 
Employment Opportunity,'' as amended by Executive Order 11375, 
``Amending Executive Order 11246 Relating to Equal Employment 
Opportunity,'' and as supplemented by regulations at 41 CFR part 60, 
``Office of Federal Contract Compliance Programs, Equal Employment 
Opportunity, Department of Labor.''
    2. Copeland ``Anti-Kickback'' Act (18 U.S.C. 874 and 40 U.S.C. 
276c)--All contracts and subgrants in excess of $2000 for construction 
or repair awarded by recipients and subrecipients shall include a clause 
for compliance with the Copeland ``Anti-Kickback'' Act (18 U.S.C. 874), 
as supplemented by Department of Labor regulations (29 CFR part 3, 
``Contractors and Subcontractors on Public Building or Public Work 
Financed in Whole or in Part by Loans or Grants from the United 
States''). The Act provides that each contractor or subrecipient shall 
be prohibited from inducing, by any means, any person employed in the 
construction, completion, or repair of public work, to give up any part 
of the compensation to which he is otherwise entitled. The recipient 
shall report all suspected or reported violations to the Department.
    3. Davis-Bacon Act, as amended (40 U.S.C. 276a to a-7)--When 
required by Federal program legislation, all construction contracts 
awarded by the recipients and subrecipients of more than $2000 shall 
include a clause for compliance with the Davis-Bacon Act (40 U.S.C. 276a 
to a-7) and as supplemented by Department of Labor regulations (29 CFR 
part 5, ``Labor Standards Provisions Applicable to Contracts Governing 
Federally Financed and Assisted Construction''). Under this Act, 
contractors shall be required to pay wages to laborers and mechanics at 
a rate not less than the minimum wages specified in a wage determination 
made by the Secretary of Labor. In addition, contractors shall be 
required to pay wages not less than once a week. The recipient shall 
place a copy of the current prevailing wage determination issued by the 
Department of Labor in each solicitation and the award of a contract 
shall

[[Page 538]]

be conditioned upon the acceptance of the wage determination. The 
recipient shall report all suspected or reported violations to the 
Department.
    4. Contract Work Hours and Safety Standards Act (40 U.S.C. 327-
333)-- Where applicable, all contracts awarded by recipients in excess 
of $2000 for construction contracts and in excess of $2500 for other 
contracts that involve the employment of mechanics or laborers shall 
include a clause for compliance with sections 102 and 107 of the 
Contract Work Hours and Safety Standards Act (40 U.S.C. 327-333), as 
supplemented by Department of Labor regulations (29 CFR part 5). Under 
section 102 of the Act, each contractor shall be required to compute the 
wages of every mechanic and laborer on the basis of a standard work week 
of 40 hours. Work in excess of the standard work week is permissible 
provided that the worker is compensated at a rate of not less than 1\1/
2\ times the basic rate of pay for all hours worked in excess of 40 
hours in the work week. Section 107 of the Act is applicable to 
construction work and provides that no laborer or mechanic shall be 
required to work in surroundings or under working conditions which are 
unsanitary, hazardous or dangerous. These requirements do not apply to 
the purchases of supplies or materials or articles ordinarily available 
on the open market, or contracts for transportation or transmission of 
intelligence.
    5. Rights to Inventions Made Under a Contract or Agreement-- 
Contracts or agreements for the performance of experimental, 
developmental, or research work shall provide for the rights of the 
Federal Government and the recipient in any resulting invention in 
accordance with 37 CFR part 401, ``Rights to Inventions Made by 
Nonprofit Organizations and Small Business Firms Under Government 
Grants, Contracts and Cooperative Agreements,'' and any implementing 
regulations issued by the Department.
    6. Clean Air Act (42 U.S.C. 7401 et seq.) and the Federal Water 
Pollution Control Act (33 U.S.C. 1251 et seq.), as amended-- Contracts 
and subgrants of amounts in excess of $100,000 shall contain a clause 
that requires the recipient to agree to comply with all applicable 
standards, orders or regulations issued pursuant to the Clean Air Act 
(42 U.S.C. 7401 et seq.) and the Federal Water Pollution Control Act as 
amended (33 U.S.C. 1251 et seq.). Violations shall be reported to the 
Department and the Regional Office of the Environmental Protection 
Agency (EPA).
    7. Byrd Anti-Lobbying Amendment (31 U.S.C. 1352)--Contractors who 
apply or bid for an award of $100,000 or more shall file the required 
certification. Each tier certifies to the tier above that it will not 
and has not used Federal appropriated funds to pay any person or 
organization for influencing or attempting to influence an officer or 
employee of any agency, a member of Congress, officer or employee of 
Congress, or an employee of a member of Congress in connection with 
obtaining any Federal contract, grant or any other award covered by 31 
U.S.C. 1352. Each tier shall also disclose any lobbying with non-Federal 
funds that takes place in connection with obtaining any Federal award. 
Such disclosures are forwarded from tier to tier up to the recipient.
    8. Debarment and Suspension (Executive Orders 12549 and 12689)-- No 
contract shall be made to parties listed on the General Services 
Administration's List of Parties Excluded from Federal Procurement or 
Nonprocurement Programs in accordance with Executive Orders 12549 and 
12689, ``Debarment and Suspension.'' This list contains the names of 
parties debarred, suspended, or otherwise excluded by agencies, and 
contractors declared ineligible under statutory or regulatory authority 
other than Executive Order 12549. Contractors with awards that exceed 
the small purchase limitation shall provide the required certification 
regarding its exclusion status and that of its principal employees.

[[Page 539]]



           SUBCHAPTER P--DIPLOMATIC PRIVILEGES AND IMMUNITIES





PART 151--COMPULSORY LIABILITY INSURANCE FOR DIPLOMATIC MISSIONS AND PERSONNEL--Table of Contents




Sec.
151.1  Purpose.
151.2  Definitions.
151.3  Types of insurance coverage required.
151.4  Minimum limits for motor vehicle insurance.
151.6  Authorized insurer.
151.7  Policy terms consistent with the Act.
151.8  Evidence of insurance for motor vehicles.
151.9  Evidence of insurance required for diplomatic license plates and 
          waiver of fees.
151.10  Minimum limits of insurance for aircraft and/or vessels.
151.11  Notification of ownership, maintenance, or use of vessel and/or 
          aircraft; evidence of insurance.

    Authority:  Sec. 6, Diplomatic Relations Act (Pub. L. 95-393; 22 
U.S.C. 254e) as amended (Pub. L. 98-164, sec. 602; 22 U.S.C. 254e).

    Source:  44 FR 29451, May 21, 1979, unless otherwise noted.



Sec. 151.1  Purpose.

    This part establishes regulations required under section 6 of the 
Diplomatic Relations Act (Pub. L. 95-393; 22 U.S.C. 254e). These 
regulations require all missions, members of missions and their 
families, and those officials of the United Nations who are entitled to 
diplomatic immunity to have and maintain liability insurance against the 
risks of bodily injury, including death, and property damage, including 
loss of use, arising from the ownership, maintenance, or use in the 
United States of any motor vehicle, vessel, or aircraft.



Sec. 151.2  Definitions.

    (a) Act means the Diplomatic Relations Act, Pub. L. 95-393 (22 
U.S.C. 254a et seq., 28 U.S.C. 1364).
    (b) Persons subject to the Act, as defined in section 2 of the Act, 
means: (1) The head of a mission and members of the diplomatic staff, 
administrative and technical staff, and service staff of a mission, as 
such terms are defined in Article 1 of the Vienna Convention on 
Diplomatic Relations of April 18, 1961 (TIAS 7502, 23 U.S.T. 3227); (2) 
members of the family of a member of the diplomatic staff of a mission 
who form part of his or her household if they are not nationals of the 
United States, and members of the family of a member of the 
administrative and technical staff of a mission who form part of his or 
her household if they are not nationals or permanent residents of the 
United States; and (3) senior officials of the United Nations as defined 
in paragraph (d) of this section.
    (c) Missions, as defined in section 2 of the Act, means missions 
within the meaning of the Vienna Convention on Diplomatic Relations and 
any missions representing foreign governments, individually or 
collectively, which are extended the same privileges and immunities, 
pursuant to law, as are enjoyed by missions under the Vienna Convention.
    (d) Senior United Nations official means a United Nations official 
entitled to diplomatic immunity as provided in section 19 of the 
Convention on Privileges and Immunities of the United Nations of 
February 13, 1946 (21 UST 1418; 1 UNTS 16).
    (e) Insurance means insurance as required by the Act and these 
regulations.



Sec. 151.3  Types of insurance coverage required.

    (a) Every person subject to the Act and every mission shall have and 
maintain with respect to any motor vehicle, vessel or aircraft owned by, 
leased to, or furnished for the regular use of every such person or 
mission liability insurance in accordance with the form, terms, and 
conditions provided for in these regulations.
    (b) The insurance shall provide coverage against the following risks 
to third parties arising from the ownership, maintenance, or use in the 
United States of any motor vehicle, vessel, or aircraft:
    (1) Bodily injury, including death;
    (2) Property damage, including loss of use; and
    (3) Any additional coverage required to be included in liability 
insurance policies by the jurisdiction where the motor vehicle, vessel 
or aircraft is

[[Page 540]]

principally garaged, berthed, or kept, such as uninsured motorist 
coverage or first party no-fault coverage.



Sec. 151.4  Minimum limits for motor vehicle insurance.

    The insurance shall provide not less than $100,000 per person and 
$300,000 per incident for bodily injury liability and $100,000 per 
incident for property damage or $300,000 combined single limit for all 
bodily injury liability and property damage liability arising from a 
single incident, except where the Director of the Office of Foreign 
Missions grants a special exception.
[54 FR 24555, June 8, 1989]



Sec. 151.6  Authorized insurer.

    The insurance must be issued by an insurer licensed or otherwise 
authorized by applicable law to do business in the jurisdiction where 
the motor vehicle, vessel or aircraft is principally garaged, berthed or 
kept.



Sec. 151.7  Policy terms consistent with the Act.

    (a) The insurance shall be construed in conformity with the Act. In 
particular, no effect shall be given to any policy terms which are 
inconsistent or in conflict with those provisions of the Act stating 
that any suit against the insurer under the policy shall not be subject 
to any of the following defenses:
    (1) That the insured is immune from suit;
    (2) That the insured is an indispensable party; or
    (3) In the absence of fraud or collusion, that the insured has 
violated a term of the contract, unless the contract was canceled before 
the claim arose.
    (b) Notwithstanding the provisions of paragraph (a) of this section, 
the insured is expected to respond to reasonable requests from the 
insurer for cooperation.



Sec. 151.8  Evidence of insurance for motor vehicles.

    (a) Every mission must periodically, and otherwise upon official 
request, furnish evidence satisfactory to the Department of State that 
the required insurance is in effect for the mission, its members and 
their families. Every senior United Nations official must also 
periodically furnish evidence satisfactory to the Department of State 
that the required insurance is in effect.
    (b) The Department of State will accept as satisfactory evidence 
that the required insurance is in effect:
    (1) A written statement of self-certification signed by the Chief of 
Mission, indicating that the mission, its members and their families 
have and will maintain insurance throughout the period of registration 
of all vehicles owned or leased or otherwise regularly used, and showing 
the name of the insurance company or companies and identifying each 
policy by number and name of insured; and
    (2) A written statement of self-certification signed by each senior 
United Nations official, indicating that he or she has and will maintain 
insurance throughout the period of registration on all motor vehicles 
owned or leased or otherwise regularly used, and showing the name of the 
insurance company or companies and identifying each by number and name 
of insured.
    (c) A certification under paragraph (b) of this section by a Chief 
of a Mission to the United Nations or by a senior United Nations 
official shall be delivered to the Counselor for host country affairs of 
the United States Mission to the United Nations. All other 
certifications shall be delivered to the Chief of Protocol, Department 
of State.



Sec. 151.9  Evidence of insurance required for diplomatic license plates and waiver of fees.

    The Department of State will not endorse on behalf of any person 
subject to the Act or any mission any application for diplomatic motor 
vehicle license plates or any application for waiver of motor vehicle 
registration fees without prior receipt of satisfactory evidence from 
the Chief of Mission or other duly authorized official that the required 
insurance is in effect.



Sec. 151.10  Minimum limits of insurance for aircraft and/or vessels.

    Insurance in respect of vessels and/or aircraft shall provide limits 
of liability

[[Page 541]]

adequate in light of reasonably foreseeable risks from the ownership, 
maintenance, or other regular use of vessels and/or aircraft.



Sec. 151.11  Notification of ownership, maintenance or use of vessel and/or aircraft; evidence of insurance.

    (a) Each person subject to the Act and each mission must notify the 
Department of State in writing of the ownership, maintenance or other 
regular use of a vessel or aircraft in the United States by such mission 
or person.
    (b) Notices under paragraph (a) of this section shall identify the 
vessel and/or aircraft with specificity, including model and 
manufacturer's name, and serial and registration numbers. Each 
notification shall be accompanied by a copy of the insurance policy or 
policies issued in respect of the vessel and/or aircraft. Such policy or 
policies need not be issued by the insurer providing liability insurance 
for motor vehicles.
    (c) With regard to senior United Nations officials, missions to the 
United Nations and members of such missions as have diplomatic status 
and their families, notices and evidence of insurance under this section 
shall be delivered to the counselor for Host Country Affairs of the 
United States Mission to the United Nations. All other notices under 
this section shall be delivered to the Chief of Protocol, Department of 
State.

[[Page 542]]



                 SUBCHAPTER Q--ENVIRONMENTAL PROTECTION





PART 161--REGULATIONS FOR IMPLEMENTATION OF THE NATIONAL ENVIRONMENTAL POLICY ACT (NEPA)--Table of Contents




                           Subpart A--General

Sec.
161.1  Purpose and scope.
161.2  Policy.
161.3  Applicability.
161.4  Definitions.

             Subpart B--NEPA and Departmental Decisionmaking

161.5  Major decision points and timing.
161.6  Responsibilities of departmental officials.
161.7  Categories of actions.

               Subpart C--Environmental Review Procedures

161.8  General description of the Department's NEPA process.
161.9  Specific steps in the Department's NEPA process.

          Subpart D--Coordination of Other Requirements of NEPA

161.10  Non-Federal applicants for permits.
161.11  Environmental review and consultation requirements.
161.12  Environmental effects abroad of major departmental actions.

    Authority:  National Environmental Policy Act (NEPA), as amended, 42 
U.S.C. 4321 et seq.; E.O. 11514, 34 FR 4247, as amended by E.O. 11991, 
42 FR 26927; 22 U.S.C. 2658, as amended.

    Source:  45 FR 59554, Sept. 10, 1980, unless otherwise noted.



                           Subpart A--General



Sec. 161.1  Purpose and scope.

    These Departmental regulations are designed to supplement the CEQ 
Regulations and provide for the implementation of those provisions 
identified in Sec. 1507.3(b) of the CEQ Regulations. The CEQ Regulations 
are incorporated herein by reference. The Department's regulations seek 
to assure that environmental considerations and values are incorporated 
into the Department's decisionmaking process and assign responsibility 
within the Department for assessing the significant environmental 
effects in the United States of the Department's actions.



Sec. 161.2  Policy.

    It is the policy of the Department of State to use all practicable 
means, consistent with the Department's statutory authority, available 
resources and national policy, to:
    (a) Protect and enhance the quality of the environment;
    (b) Ensure that environmental amenities and values are appropriately 
considered in Departmental actions;
    (c) Integrate planning and environmental review procedures with the 
Department's decisionmaking process;
    (d) Invite and facilitate, when appropriate, Federal, State and 
local governmental authorities and public involvement in decisions which 
affect the quality of the environment; and
    (e) Recognize the worldwide and long-range character of 
environmental concerns and, when consistent with the foreign policy of 
the United States, lend appropriate support to initiatives, resolutions, 
and programs designed to maximize international cooperation in 
anticipating and preventing a decline in the quality of the world 
environment.



Sec. 161.3  Applicability.

    The provisions of these regulations apply to decisions on all 
Departmental actions which may affect the quality of the environment 
within the United States. The Department is establishing separate 
environmental review procedures under Executive Order 12114 (January 4, 
1979) for actions having potential effects on the environment of global 
commons or areas outside the jurisdiction of any nation, or on the 
environment of foreign nations.



Sec. 161.4  Definitions.

    Definitions for many terms used in these regulations may be found in 
section 1508 of the CEQ Regulations. In addition, for the purpose of 
these regulations, the term:

[[Page 543]]

    (a) Responsible action officer means the Department officer 
principally responsible for the preparation of action memoranda and 
other documents relating to a given Departmental action to which by 
these regulations apply. Ordinarily, the responsible action officer will 
be the country or office director whose office has action responsibility 
for a given action.
    (b) CEQ Regulations means the regulations implementing the 
procedural provisions of the National Environmental Policy Act, issued 
by the Council on Environmental Quality on November 29, 1978 (43 FR 
55978-56007), and codified at 40 CFR parts 1500-1508.
    (c) United States means the States, the Commonwealth of Puerto Rico, 
the Commonwealth of the Northern Marianas, the Trust Territory of the 
Pacific Islands, American Samoa, the U.S. Virgin Islands, Guam and the 
other territories and possessions of the United States, including the 
territorial seas thereof. For the purpose of these regulations, actions 
having significant environmental effects on the resources of the U.S. 
continental shelf or resources of the U.S. Fishery Conservation Zone 
subject to the jurisdiction of the United States shall be considered to 
be actions having significant environmental effects in the United 
States.
    (d) Environmental document means an environmental assessment, an 
environmental impact statement, a Finding of No Significant Impact or a 
Notice of Intent prepared under these regulations.



             Subpart B--NEPA and Departmental Decisionmaking



Sec. 161.5  Major decision points and timing.

    (a) The responsible action officer shall ensure compliance with 
these regulations at the earliest practicable stage of Departmental 
study, consideration or planning of a proposed major Federal action 
which could significantly affect the quality of the human environment. 
To accomplish this the responsible action officer must ensure that data 
developed during the review process is collected, analyzed and made 
available for consideration early in planning and decisionmaking when it 
will be most valuable in formulating, reviewing and deciding upon 
proposals for Departmental action.
    (b) Environmental analysis and review of a proposed Departmental 
action shall be conducted as early as practicable so as to be timely, 
yet late enough to be relevant to the decisionmaking.
    (c) Environmental documents should, whenever possible, accompany the 
principal action memorandum relating to a proposed action. An 
environmental document required in conjunction with conclusion of an 
international agreement shall, where possible, be prepared and 
circulated for review and comment before final negotiations begin. The 
completed environmental document should thus ordinarily accompany the 
principal action memorandum or request for authority to negotiate an 
agreement under the Department's Circular 175 regulation (11 FAM 720).
    (d) To the maximum extent possible an environmental document should 
be prepared before the establishment of a final United States position 
on a proposal. In such cases the document should indicate the 
alternatives under consideration without specifying a Departmental 
preference. If the content and dimensions of a proposed action will not 
be clear until after the conclusion of an international negotiation or 
if a decision to proceed on an action involving another nation or 
international organization is required on short notice and before the 
environmental document can be prepared, the environmental document 
should be prepared as soon as possible after the conclusion of an agreed 
text of a treaty or agreement on the proposed action. If the Senate's 
advice and consent to a treaty with potential significant environmental 
effects in the United States will be sought, the final environmental 
impact statement should accompany other decision documentation for 
ratification. Legislative environmental impact statements on proposed 
treaties or legislation shall conform to the requirements of Sec. 1506.8 
of the CEQ Regulations and must be prepared in time for Congressional 
hearings and deliberations.

[[Page 544]]

    (e) Because actions having effects on the United States may to 
varying degrees be initiated, influenced and conducted by other 
countries, it is recognized that the preparation of environmental 
documents for such actions must be adjusted to meet a variety of 
circumstances. Bearing in mind the degree to which other countries 
possess information on and the ability to affect the decision under 
consideration, responsible action officers shall seek at all times to 
prepare environmental analysis documents as early as feasible in the 
decisionmaking process.



Sec. 161.6  Responsibilities of departmental officials.

    (a) General. As a general rule, responsibility for preparing 
environmental analysis documents will follow the Department's standard 
organizational practices; in this way environmental considerations and 
awareness of environmental responsibilities will be integrated most 
readily and effectively into the usual decisionmaking processes.
    (1) Departmental bureaus. Each bureau within the Department shall be 
responsible for:
    (i) Implementing these regulations and incorporating them into its 
normal decisionmaking processes;
    (ii) Identifying actions it intends to initiate which may affect 
significantly the environment of the United States and employing the 
environmental evaluation procedures outlined in these regulations to 
ensure that necessary actions are taken to meet the requirements of 
applicable laws and regulations;
    (iii) Coordinating environmental assessment-related activities for 
which it is responsible with the Office of Environment and Health in the 
Bureau of Oceans and International Environmental and Scientific Affairs 
and supporting and assisting the Office of Environment and Health in 
implementing these regulations as required; and
    (iv) Providing the personnel required to implement these 
regulations, informing the Office of Environment and Health and the 
Office of the Legal Adviser whenever it is anticipated that 
environmental documents will be prepared under these regulations, and 
consulting the Office of Environment and Health and the Office of the 
Legal Adviser as necessary for guidance and assistance in the 
preparation of such documents.
    (2) Bureau of Oceans and International Environmental and Scientific 
Affairs. Through its Office of Environment and Health the Bureau shall 
have the primary responsibility for ensuring the Department's compliance 
with environmental policies, regulations and procedures. It shall 
provide policy and professional direction and guidance within the 
Department for implementing these regulations. It shall also assist 
other bureaus in obtaining appropriate scientific advice and budgetary 
resources to implement the regulations. The Office of Environment and 
Health will act as the focal point for implementation, working closely 
with the Departmental bureaus and the Office of the Legal Adviser. The 
Bureau and other involved bureaus will work closely with the Assistant 
Secretary for Congressional Relations in the preparation of 
environmental documents relating to legislation. In carrying out its 
responsibilities the Bureau shall:
    (i) Coordinate the formulation, development and revision of 
Departmental policies and positions on matters pertaining to 
environmental evaluation and review;
    (ii) Develop and ensure the implementation of Departmentwide 
standards, procedures and working relationships for environmental review 
and compliance with applicable environmental laws and regulations;
    (iii) Develop, as an integral part of the Department's basic 
decision processes, procedures to ensure that environmental factors are 
properly considered in all relevant proposals and decisions;
    (iv) Monitor these processes to ensure that Departmental procedures 
are achieving their purposes;
    (v) Advise, assist and inform Departmental bureaus of the technical 
and management aspects of environmental analysis, and of the relevant 
expertise available in and outside the Department;

[[Page 545]]

    (vi) Establish and maintain working relationships with the Council 
on Environmental Quality, Environmental Protection Agency, and other 
federal, State and local governmental agencies concerned with 
environmental matters;
    (vii) Represent the Department in working with other government 
agencies and organizations to formulate, revise and achieve uniform 
understanding and application of government-wide policies relating to 
the environment;
    (viii) Consolidate and transmit to the appropriate parties 
Departmental comments on environmental impact statements and other 
environmental reports prepared by other agencies; and
    (ix) Acquire information for and prepare other Departmental reports 
on environmental assessment matters.
    (3) Office of the Legal Adviser. The Office of the Legal Adviser is 
the principal Departmental authority on the legal aspects of 
environmental matters and the implementation of these regulations and 
shall advise and assist Departmental Bureaus in these matters.
    (4) Bureau Environmental Coordinators. Each Departmental bureau and 
major office shall designate an officer to act as coordinator, adviser 
and principal point of contact for environmental matters within the 
bureau. The bureau coordinator will advise and assist the bureau in 
implementing these regulations and serve as a member of the Departmental 
Committee of Environmental Coordinators.
    (5) Departmental Committee of Environmental Coordinators. A 
Departmental Committee of Environmental Coordinators shall be 
established to assist in coordinating Departmental implementation of 
these regulations; in providing advice on major issues, policies and 
procedures relating to the Department's implementation of environmental 
analysis requirements; and in ensuring general conformity of 
Departmental implementation practices. The Committee's responsibility 
will be to exchange information on the implementation of these 
regulations, assist bureaus in early identification of Departmental 
actions which should be analyzed for environmental effects and help to 
coordinate and provide the appropriate analysis. The Committee will be 
chaired by the Office of Environment and Health and will be comprised of 
bureau and office coordinators designated by the respective bureaus and 
offices.
    (6) Outside contractors. Qualified outside contractors may be 
employed to assist Departmental officers in preparing environmental 
documents as required under these regulations.



Sec. 161.7  Categories of actions.

    Departmental officers shall review each major Departmental action 
having a potentially significant effect on the quality of the 
environment in the United States. The need to prepare formal 
environmental documents will depend on the scope of the action and the 
context and intensity of any environmental effects expected if the 
action is implemented. Departmental actions can generally be grouped 
into three categories, as follows:
    (a) Actions normally requiring environmental impact statements. Any 
Departmental action deemed to have a ``significant effect upon the 
quality of the human environment'' of the United States requires the 
preparation of an environmental impact statement. The criteria to be 
used in determining significance are set forth in Sec. 1508.27 of the 
CEQ Regulations. The Department has reviewed representative actions and 
has found no common pattern which would enable it to specify actions 
normally requiring environmental impact statements. If developments 
later enable such designations to be made the Department will publish a 
description of proposed actions for such designation in the Federal 
Register.
    (b) Actions categorically excluded from the requirement to prepare 
environmental impact statements. Categorical exclusion, as defined in 
Sec. 1508.4 of the CEQ Regulations, provides for exclusion from 
environmental review of specified actions which have as a class been 
found to have no significant impact on the quality of the human 
environment. Neither an environmental assessment nor an environmental 
impact statement is ordinarily required for such actions. Departmental 
actions categorically excluded from the requirements of these 
regulations include the following:

[[Page 546]]

    (1) Routine conduct of Departmental and overseas political and 
economic functions, including reporting on political and economic 
developments, trends and activities, communicating to host governments 
United States Government views, maintaining contact with foreign 
officials and individuals, and facilitating trade opportunities abroad 
and U.S. business expansion in foreign markets;
    (2) Provision of consular services--visas, passports and 
citizenship, and special consular services, such as issuing or reviewing 
passports and visas, taking legal depositions, notarizing absentee 
ballots and other documents and delivering retirement checks, social 
security payments and veterans benefits;
    (3) Conduct of routine administrative functions, such as budget and 
finance, personnel and general services. This includes routine 
administrative procurements (e.g., general supplies, negotiating leases 
for office space or staff housing, ordering supplies and arranging for 
customs clearances); financial transactions, including salaries, 
expenses and grants; routine management, formulation and allocation of 
the Department's budget at all levels (this does not exempt the 
preparation of environmental documents for proposals included in the 
Department's budget when required); and personnel actions (e.g., 
promotions, hirings, and counseling American and host country employees 
who work for the Department of State);
    (4) Preparing for and participating in conferences, workshops or 
meetings for information exchange, data collection or research or study 
activities; and
    (5) Document and information exchanges.

Even though an action may be categorically excluded from the need for an 
environmental impact statement, if information developed during the 
planning for the actions indicates the possibility that the particular 
action in question may nonetheless cause significant environmental 
effects, an environmental assessment shall be prepared to evaluate those 
effects. Based upon the assessment, a determination will be made whether 
to prepare an environmental impact statement. The Department may 
designate additional actions for categorical exclusion by publishing a 
listing of actions proposed for such designation in the Federal 
Register.
    (c) Actions normally requiring environmental assessments. An 
environmental assessment shall provide the basis of the determination 
whether an environmental impact statement is required. A Departmental 
action shall require the preparation of an environmental assessment if 
the action is not one known normally to require an environmental impact 
statement and is not categorically excluded. Departmental actions 
normally included in this category are actions for which the Department 
has lead-agency responsibility and which may significantly affect the 
human environment of the United States, such as those actions involving:
    (1) Issuance of permits for construction of international bridges 
and pipeline (see Executive Order 11423 and the International Bridge Act 
of 1972 (Pub. L. 92-434, 86 Stat. 23));
    (2) Wetlands, floodplains, endangered species and national 
historical, archeological and recreational sites (see also specific 
requirements for environmental review and consultation in Sec. 161.11 of 
these regulations); and
    (3) Ocean dumping, control of toxic substances, disposal and storage 
of wastes and radioactive substances.
    (d) Emergencies and other exceptional circumstances. Not every 
Departmental activity will be considered a major Federal action for the 
purposes of these regulations. Several limited classes of action which 
might ordinarily be subject to these regulations will not be considered 
major Federal actions requiring the preparation of an environmental 
impact statement. Among them are the following:
    (1) Actions taken in emergency circumstances and disaster and 
emergency relief activities as defined in Sec. 1506.11 of the CEQ 
Regulations (in such circumstances the responsible action officer should 
consult with the Office of Environment and Health which shall consult 
with the Council on Environmental Quality about appropriate alternative 
arrangements);
    (2) Mandatory actions required under any treaty or international 
agreement

[[Page 547]]

to which the United States Government is a party, or required by the 
decisions of international organizations or authorities in which the 
United States is a member or participant except when the United States 
has substantial discretion over implementation of such requirements;
    (3) Payment of contributions, either assessed or voluntary, to any 
international organization of which the United States is a member 
pursuant to the obligation of a treaty or other international agreement 
or which is not for the purpose of carrying out a specifically 
identifiable action which would affect the environment; and
    (4) Support for or acquiescence in (by affirmative vote or agreement 
to consensus) an activity or expenditure of funds by an international 
organization where the United States has no unilateral right to control 
such expenditures.



               Subpart C--Environmental Review Procedures



Sec. 161.8  General description of the Department's NEPA process.

    In reviewing proposed actions for potential environmental effects in 
the United States responsible action officers will follow the procedural 
steps set forth below. These steps are developed in conjunction with the 
procedural steps required by the CEQ Regulations which are referenced in 
the following sections.
    (a) Preliminary environmental evaluations. Early in the process of 
considering any possible action the responsible action officer shall 
review the action to determine if it may cause potential significant 
environmental effects on the environment of the United States. A 
proposed action shall be reviewed initially to determine into which of 
the following three basic categories of action it falls:
    (1) Actions normally requiring environmental impact statements;
    (2) Actions categorically excluded from environmental impact 
statements; or
    (3) Actions normally requiring environmental assessments. If the 
responsible action officer concludes that the proposed action is a major 
action potentially having significant effects in the United States he 
should, in cooperation with other appropriate Departmental officials, 
carry out the steps described in these regulations. If during his review 
of the location of potential environmental effects or following 
preparation of an environmental assessment it is determined that the 
action could affect the environment of the global commons or a foreign 
nation the officer is responsible for ensuring compliance with the 
Department's procedures for implementing Executive Order No. 12114 on 
Environmental Effects Abroad of Major Federal Actions (Foreign Affairs 
Manual, Volume 2).
    (b) Environmental Assessment. An environmental assessment is a 
concise document which analyzes potential environmental effects to 
determine if an environmental impact statement is required (CEQ 
Regulations Secs. 1501.3 and 1508.9). If the action does not fall into 
either the category of those actions normally requiring an environmental 
impact statement or that of actions categorically excluded from the 
requirement to prepare an environmental impact statement, then the 
responsible action officer, in cooperation with other Departmental 
officials, shall prepare an environmental assessment to determine 
whether it is necessary to prepare an environmental impact statement or 
a ``Finding of no significant impact''. If the action normally requires 
an environmental impact statement, there is ordinarily no need for the 
preparation of an environmental assessment and the environmental impact 
statement process should be initiated without preparing such an 
assessment. If the action is categorically excluded, no further 
environmental review is needed. If an environmental assessment is 
prepared it may also be used to evaluate whether the proposed action may 
have effects outside the United States.
    (c) Finding of no significant impact. If the environmental 
assessment indicates that the environmental effects of the action in the 
United States are not significant, then the responsible action officer 
shall make a ``Finding of no significant impact'', thereby concluding 
the NEPA review process (CEQ Regulations Secs. 1501.4 and 1508.13).

[[Page 548]]

    (d) Environmental impact statement. If the environmental assessment 
demonstrates that the environmental effects of the action with the 
United States may be ``significant'' (see Sec. 1508.27 of the CEQ 
Regulations) the Department is required to prepare an environmental 
impact statement (EIS) in accordance with these regulations (see also 
CEQ Regulations Sec. 1501.8, part 1502 and Secs. 1506.2 through 1506.7). 
In preparing the environmental impact statement the following steps will 
be carried out:
    (1) Notice of intent to prepare an EIS. If an impact statement is 
required, the Department will publish in the Federal Register a ``Notice 
of intent'' to prepare such a statement (CEQ Regulations Secs. 1501.7 
and 1508.22).
    (2) Scoping procedures. The Department will then hold a scoping 
meeting with interested agencies and individuals to determine the proper 
content (``scope'') of the statement (CEQ Regulations Secs. 1501.7 and 
1508.25).
    (3) Draft environmental impact statement (DEIS). The Department will 
then prepare a draft EIS (DEIS) which will be filed with the 
Environmental Protection Agency and circulated to agencies and the 
public for comment for at least 45 days, except where the CEQ 
Regulations and these regulations permit the time period to be shortened 
(CEQ Regulations Sec. 1501.8, part 1502, Secs. 1506.2 through 1506.7, 
1506.10(d) and 1506.11; 161.7(d), 161.9(n)(2)).
    (4) Final environmental impact statement (FEIS). In light of the 
comments and following any revision in the draft EIS, the Department 
will file with the Environmental Protection Agency and circulate to 
agencies and the public a final EIS at least 30 days before making a 
final decision on the action, except where the CEQ Regulations and these 
regulations permit the time period to be shortened (CEQ Regulations 
Secs. 1506.9, 1506.10(d), 1506.11; 161.7(d), 161.9(n)(2)).
    (5) Record of decision. After making a decision on the action, the 
Department will make available a formal ``Record of decision'' (CEQ 
Regulations Sec. 1505.2).



Sec. 161.9  Specific steps in the Department's NEPA process.

    (a) Decision whether to prepare an EIS. In deciding whether to 
prepare an environmental impact statement, the responsible action 
officer shall make an initial review in the early planning stages of a 
proposed action to identify and evaluate potential environmental effects 
of the actions and all reasonable measures which may be taken to 
mitigate adverse impacts. This review must be conducted in conjunction 
with all requests under the Department's Circular 175 procedure (11 FAM 
720), with all actions involving the obligation of funds within the 
Department's annual or supplemental budget submissions to the Office of 
Management and Budget, and with other actions when a potentially 
significant environmental impact may result. The responsible action 
officer shall ensure that the principal action memoranda prepared for 
such actions properly reflect the environmental review in all cases. No 
written statement is required in the case of actions which do not raise 
the question of environmental impacts. The environmental evaluation 
document prepared shall be considered along with political, economic and 
other decisionmaking factors relating to the proposed action.
    (1) Review of the categories of actions. During the initial 
environmental review of the proposed action, the responsible action 
officer should classify the proposed Departmental action as one either 
normally requiring an environmental impact statement, normally not 
requiring such a statement, or normally requiring an environmental 
assessment. (See Sec. 1504.1 of the CEQ Regulations and Sec. 161.7 of 
these regulations.)
    (i) Actions normally requiring environmental statements. 
Environmental assessments are not required for actions which it is 
already known will require the preparation of environmental impact 
statements. For each major Departmental action which, in the view of the 
responsible action officer meets the criteria of this section, he shall, 
in cooperation with the Office of Environment and Health, initiate steps 
to prepare an environmental impact statement. This will be accomplished 
by

[[Page 549]]

preparing a ``Notice of intent'' to prepare an EIS (see Sec. 1508.22 of 
the CEQ Regulations). The Office of Environment and Health shall arrange 
for publication of the notice in the Federal Register (see 
Sec. 1507.3(e) of the CEQ Regulations). The responsible action officer 
shall then apply the procedures set forth in Sec. 161.8 of these 
regulations to determine the scope of the proposed EIS, and proceed to 
prepare and release the environmental impact statement in accordance 
with CEQ and Departmental regulations. If, however, the responsible 
action officer believes that the proposed action, though included within 
or closely similar to one which normally requires the preparation of an 
EIS, will itself have no significant impact, he should conduct an 
environmental assessment in accordance with the CEQ Regulations 
(Sec. 1508.9). If the assessment demonstrates that there will be no 
significant impact, he should prepare a ``Finding of no significant 
impact'' and provide for public review a notice of this finding in 
accordance with Secs. 1501.4(e) and 1506.6 of the CEQ Regulations.
    (ii) Actions categorically excluded. Separate detailed documentation 
is not normally required for actions which are categorically excluded 
and which are therefore exempt from the requirement of preparations of 
an environmental assessment or environmental impact statement. However, 
the responsible action officer shall note in the action memorandum 
concerning the action that the proposed action has been reviewed under 
the Department's environmental procedures and determined to be 
categorically excluded. The Office of Environment and Health shall 
periodically review actions in the classes categorically excluded under 
these regulations to determine if the original decision to categorically 
exclude the class remains valid. If such a review determines that a 
proposed action may have a significant impact on the human environment 
the necessary revision in the categorical exclusion shall be made and an 
environmental assessment shall be prepared to determine the need for the 
preparation of an environmental impact statement.
    (iii) Actions normally requiring environmental assessments. For each 
action meeting the criteria of this section the responsible action 
officer shall prepare an environmental assessment (see Secs. 1501.3 and 
1508.9 of the CEQ Regulations) and, on the basis of that assessment, 
determine if an EIS is required. If the determination is that no 
environmental impact statement is required, the responsible action 
officer shall, in coordination with the Office of Environment and 
Health, prepare a ``Finding of no significant impact'' (see Secs. 1501.4 
and 1508.13 of the CEQ Regulations). The ``Finding of no significant 
impact'' shall be made available to the public through direct 
distribution and publication in the Federal Register. If the 
determination is that an environmental impact statement is required, the 
official shall proceed with the ``Notice of intent'' to prepare an EIS 
and the subsequent steps in the preparation and release of an EIS in 
accordance with the CEQ Regulations (Secs. 1501.7, 1507.3 and 1508.22) 
and these regulations.
    (2) Preparation of environmental assessments. Environmental 
assessments, as defined in the CEQ Regulations (Sec. 1508.9), should be 
prepared as directed in Sec. 1501.3 of the CEQ Regulations. The 
environmental assessment shall be used to determine whether to prepare 
an environmental impact statement or a ``Finding of no significant 
impact''. The assessment shall include a brief discussion of the need 
for the proposed action, of alternatives and of environmental impacts 
and a listing of agencies and persons consulted in preparing the 
assessment.
    (3) Notice of intent to prepare an EIS. As soon as practicable after 
deciding to prepare an environmental impact statement and before 
initiating the scoping process (see Sec. 161.9(b) of these regulations) 
the Department or another lead agency, if one is designated in 
accordance with Sec. 1501.5 of the CEQ Regulations, shall publish in the 
Federal Register a ``Notice of intent'' to prepare an EIS in accordance 
with Secs. 1501.7 and 1508.22 of the CEQ Regulations. The Office of 
Environment and Health shall arrange for publishing the notice.
    (b) Scoping. The Department shall conduct an early and open meeting 
with interested agencies and the public

[[Page 550]]

for determining the scope of issues to be addressed in a given 
environmental impact statement and for identifying the significant 
issues related to a proposed action. The elements of the scoping process 
are defined in Sec. 1501.7 of the CEQ Regulations and must include 
consideration of the range of actions, alternatives, and impacts 
discussed in Sec. 1508.25 of the CEQ Regulations.
    (c) Cooperation with other agencies. Departmental officials are 
encouraged to cooperate with other agencies and the public throughout 
the conduct of the Department's NEPA process. The Office of Environment 
and Health shall ensure also that the Department reviews the draft and 
final impact statements submitted for review by other agencies 
(Sec. 1502.19 of the CEQ Regulations). Where appropriate and to 
eliminate duplication it shall arrange to prepare environmental 
assessments and impact statements jointly with other Federal or State 
agencies. Where possible it will arrange for the department to ``adopt'' 
statements prepared by other agencies (Sec. 1506.3 of the CEQ 
Regulations). It shall arrange lead and cooperating agency 
responsibilities for preparing environmental documents (see Secs. 1501.5 
and 1501.6 of CEQ Regulations).
    (d) Preparation of draft environmental impact statement. The 
responsible action officer shall be responsible for the preparation of 
the draft environmental impact statement in the manner described in 
Sec. 1501.8, part 1502, and Secs. 1506.2 through 1506.7 of the CEQ 
Regulations. Preliminary copies of the draft environmental impact 
statement and attachments shall be submitted to the Office of 
Environment and Health before any formal review is conducted outside the 
Department. This submission shall be accompanied by a list of Federal, 
State, and local officials (Part 1503 of the CEQ Regulations) and a list 
of other interested parties (Sec. 1506.6 of the CEQ Regulations) whose 
comments shall be sought. The Office of Environment and Health shall 
review the draft and obtain additional comments from other appropriate 
Departmental bureaus and offices.
    (e) Review of and comment on draft EIS. For external review, the 
Office of Environment and Health shall transmit five copies of the 
revised draft statement to the Environmental Protection Agency (EPA) 
Office of Federal Activities. EPA will publish a notice of the 
statement's availability the following week in the Federal Register. 
Upon transmission of the draft statement to EPA, the Office of 
Environment and Health shall also seek the views of appropriate agencies 
and individuals in accordance with Part 1503 and Secs. 1506.6 and 1506.9 
of the CEQ Regulations. It shall specify that replies are required at a 
stated date not earlier than 45 days from the date of NEPA publication 
of the draft statement availability. Any views submitted during the 
comment period shall be provided to the responsible action officer in 
the Department for consideration in preparing the final statement. To 
the fullest extent possible, requirements for review and consultation 
with other agencies on environmental matters established by statutes 
other than NEPA, such as the review and consultation requirements of the 
Endangered Species Act of 1973, as amended, should be met before or 
through this review process (see Sec. 161.11 of these regulations). In 
addition, the draft EIS shall list all environmentally-related federal 
permits, licenses or other approvals required to implement the proposal 
as specified in Sec. 1502.25(b) of the CEQ Regulations.
    (f) Public involvement. (1) Departmental officials will make 
diligent efforts to involve the public in implementing these regulations 
as provided in Secs. 1501.4(e), 1503.1(a)(e) and 1506.6 of the CEQ 
Regulations.
    (2) Interested persons can obtain information on the Department's 
environmental impact statements and other aspects of the Department's 
NEPA process by contacting the Director, Office of Environment and 
Health, Room 7820, Department of State, Washington, DC 20520 (tel. 202/
632-9266). Information pertaining to the NEPA process may be sent to the 
above address. Federal Register notices concerning the Department's 
environmental documents shall specify where such information relevant to 
the documents in question may be obtained.

[[Page 551]]

    (3) The responsible action officer shall identify those persons, 
community organizations, environmental interest groups, international 
organizations or other bodies which may have an interest in or be 
affected by the proposed Departmental action and who should therefore be 
involved in the NEPA process. With the assistance of the Office of 
Environment and Health, the responsible action shall transmit a list of 
such persons, groups and organizations to the Office of Environment and 
Health at the same time he submits:
    (i) A recommendation regarding a ``Finding of no significant 
impact'';
    (ii) A ``Notice of intent to prepare an EIS'';
    (iii) A recommendation on possible public hearings (see 
Sec. 1506.6(c) of CEQ Regulations);
    (iv) A draft EIS, or
    (v) A final EIS.
    (4) The responsible action officer shall consult with the Office of 
Environment and Health and make recommendations regarding the need for 
public hearings. The Office of Environment and Health shall, as 
necessary, review such recommendations with the Office of the Legal 
Adviser.
    (g) Preparation of final environmental impact statement. (1) After 
conclusion of the review process with other Federal, State and local 
agencies and the public, the responsible action officer shall consider 
suggestions received and revise the draft environmental impact statement 
as appropriate in accordance with part 1502 and Sec. 1501.8 and 
Secs. 1506.2 through 1506.7 of the CEQ Regulations.
    (2) Five copies of the preliminary final environmental impact 
statement, with attached copies of the comments received and suggested 
responses, shall be provided to the Office of Environment and Health. 
The Office of Environment and Health will, as appropriate, obtain 
additional comments from any other appropriate Departmental bureau or 
offices and notify the responsible action officer of any further changes 
required and the number of final statements to be transmitted. The 
Office of Environment and Health shall submit five copies of the final 
statement to the Environmental Protection Agency's Office of 
Environmental Review. Copies shall also be sent to all parties who 
commented and to other interested parties in accordance with Sec. 1506.9 
of the CEQ Regulations.
    (3) Each draft and final statement, the supporting documentation, 
and the ``Record of decision'' (see Sec. 161.9(h) of these regulations) 
shall be available for public review and copying at the Office of 
Environment and Health (OES/ENH), Room 7820, Department of State, 
Washington, DC 20520 (tel. 202/632-9267).
    (h) Record of the decision. At the time of the decision on the 
proposed action, the responsible Departmental official shall consult 
with the Office of Environment and Health and prepare a concise ``Record 
of decision'' (see Sec. 1505.2 of the CEQ Regulations).
    (i) Timing of EIS preparation and action decision. Preparation of an 
environmental impact statement shall be initiated as soon as the 
responsible action officer, in consultation with the Office of 
Environment and Health and the Office of the Legal Adviser, has 
determined that the statement shall be prepared. Except where permitted 
by the CEQ Regulations (Secs. 1506.10(d), 1506.11) and these regulations 
(Secs. 161.7(d), 161.9(n)(2)), no decision on the proposed action shall 
be made by the Department until the later of the following dates:
    (1) Ninety (90) days after publication by EPA of a notice of 
availability of a Departmental draft EIS.
    (2) Thirty (30) days after publication by EPA of a notice of 
availability of a departmental final EIS.
    (j) Implementing and monitoring the decision. Section 1505.3 of the 
CEQ Regulations establishes the procedures to be followed by the 
Department in monitoring to assure that any mitigation measures or other 
commitments associated with the decision and its implementation are 
carried out. The Office of Environment and Health will maintain general 
oversight and cooperate with bureau officers in such monitoring.
    (k) Supplemental environmental impact statements. Departmental 
officials shall supplement a draft EIS whenever an alternative which is 
substantially different from those discussed in the draft is under 
consideration or when the

[[Page 552]]

draft is otherwise out of date. A final EIS shall be supplemented when a 
substantial change is made in the proposed action or when significant 
new information on the environmental impacts comes to light. A 
supplemental EIS should be prepared, circulated and approved in 
accordance with the provisions of Sec. 1502.9 of the CEQ Regulations. No 
supplemental EIS need be prepared when the final decision on the action 
in question has already been made. If there are reasons not to prepare a 
supplemental EIS when one ordinarily would be called for, the 
responsible action officer should consult with the Office of Environment 
and Health, which shall consult with the Council on Environmental 
Quality on the matter.
    (l) Programmatic and generic environmental impact statements. (1) 
Before preparing an environmental document under these regulations the 
responsible action officer should determine if there exists a generic or 
programmatic environmental document analyzing actions, effects or issues 
similar to those involved in the proposed action. A generic 
environmental document reviews the environmental effects that are 
generic or common to a class of Departmental actions which may not be 
specific to any single country or area. Where such a document is 
prepared it could be applied to a number of similar specific country 
applications. If a generic document exists and if it deals with relevant 
similarities in the action, such as common timing, environmental 
impacts, alternatives, methods of implementation or subject matter it 
will not be necessary to prepare further environmental documentation.
    (2) A programmatic environmental document shall focus its analysis 
on the environmental aspects of an entire program rather than on the 
specific elements of the program. If a programmatic environmental 
document has already been prepared the responsible action officer should 
determine whether it adequately deals with the environmental effects of 
the particular action under review. If the programmatic document 
adequately reviews the environmental impacts of the action under 
consideration, then additional environmental documentation is not 
required under these regulations. In preparing environmental documents 
on specific actions, Departmental officers shall consider the 
advisability of modifying or expanding the documents so they may serve 
as generic or programmatic documents for a broader range of actions.
    (m) Amendments. Amendments to these regulations may be made by the 
Assistant Secretary for Oceans and International Environmental and 
Scientific Affairs in consultation with other Departmental bureaus and 
the Office of the Legal Adviser. Such amendments will be published in 
the Federal Register after consultation with the Council on 
Environmental Quality, in accordance with Sec. 1507.3 of the CEQ 
Regulations, and public review and comment.
    (n) Modifications. The Department's procedures for preparing 
environmental documents may be modified to accommodate the following 
circumstances:
    (1) Classified material. Most Departmental environmental documents 
will not normally contain classified or administratively controlled 
material (see Sec. 1507.3(c) of the CEQ Regulations); in some cases, 
however, an environmental document must include such material to 
evaluate adequately environmental effects. In such cases Departmental 
environmental documents, or portions thereof, may be classified. Such 
material should, if possible, be confined to a classified annex of the 
environmental document. Approval for classification must be granted with 
the concurrence of the Assistant Secretary for Oceans and International 
Environmental and Scientific Affairs and the Office of the Legal 
Adviser, and the assistant secretary of the bureau with the action 
responsibility for the proposed action. In these cases, Departmental 
environmental documents or portions thereof may be classified in 
accordance with the criteria set forth in Executive Order 12065, dated 
December 1, 1978. Handling and disclosure of classified or 
administratively controlled material shall be governed by 22 CFR part 9. 
The portions of an environmental document which are not classified or 
administratively controlled will be made available to persons outside 
the Department, as provided in 22 CFR part 9.

[[Page 553]]

Classification does not preclude the obligation to ensure that 
environmental documents are reviewed by competent scientific and 
technical experts. Appropriate arrangements will be made through the 
Office of Environment and Health for Federal agency review of classified 
or administratively controlled environmental documents.
    (2) Time periods for environmental review. When necessary to comply 
with other specific statutory requirements or for compelling reasons of 
national policy the Department may, by agreement with the Environmental 
Protection Agency, modify time periods specified by the CEQ Regulations 
for preparing environmental documents in accordance with Sec. 1506.10 of 
the CEQ Regulations. See also provisions for emergency circumstances 
contained in Sec. 1506.11 of the CEQ Regulations and Sec. 161.7(d) of 
these regulations.



          Subpart D--Coordination of Other Requirements of NEPA



Sec. 161.10  Non-Federal applicants for permits.

    The Department is responsible for issuing international permits for 
the construction of bridges and oil pipelines that cross the 
international boundaries with Canada and Mexico. The Office of 
Environment and Health will assist in preparation of the required 
environmental analysis documentation for such permits. Applicants for 
international permits may obtain information on the type of 
environmental information needed and the extent of the applicant's 
participation in the necessary environmental studies and their 
documentation from the Office of the Legal Adviser, Department of State, 
Washington, DC 20520 (tel. 202/632-0349). Applicants are encouraged to 
consult early with the Department on the necessary environmental and 
other requirements in order to expedite the NEPA process.



Sec. 161.11  Environmental review and consultation requirements.

    In addition to the environmental review requirements of NEPA the 
Department has other statutory environmental review and consultation 
requirements. Departmental officials, in cooperation with the Office of 
Environment and Health and the Office of the Legal Adviser shall, to the 
maximum extent possible, conduct environmental review and consultation 
for these additional requirements concurrently with and integrated with 
preparation of assessments, and environmental impact statements. The 
principal additional requirements affecting the Department of State's 
actions are outlined below.
    (a) Section 7 of the Endangered Species Act, as amended, 16 U.S.C. 
1531 et seq., requires identification of and consultation on aspects of 
any Departmental action that may have effects in the United States on 
listed species or their habitat. As appropriate, written request for 
consultation, along with the draft environmental document, shall be 
conveyed by the Office of Environment and Health to the Regional 
Director of the U.S. Fish and Wildlife Service or the National Marine 
Fisheries Service, as appropriate, for the Region in the United States 
where the action will be carried out.
    (b) Section 106 of the National Historic Preservation Act of 1966, 
as amended, 16 U.S.C. 470(f), requires identification of National 
Register properties, eligible properties, or properties in the United 
States which may be eligible for the National Register within the area 
of the potential impact of a proposed Departmental action. Evaluation of 
the impact of the action on such properties shall be discussed in draft 
environmental impact statements and transmitted to the Advisory Council 
on Historic Preservation for comments.
    (c) Executive Order 11988 (Floodplains Management) and Executive 
Order 11990 (Wetlands), requires identification of actions which will 
occur in or affect a floodplain or wetland (e.g., in areas along the 
boundary with Canada or Mexico). A comparative evaluation of such 
actions shall be discussed in draft environmental impact statements and 
transmitted to the U.S. Water Resources Council for comments.
    (d) Fish and Wildlife Coordination Act, 16 U.S.C. 661 et seq.
    (e) Section 309 of the Clean Air Act of 1955, as amended, 42 U.S.C. 
7609.

[[Page 554]]

    (f) Clean Water Act of 1977, 33 U.S.C. 1251 et seq.
    (g) Coastal Zone Management Act of 1972, as amended, 16 U.S.C. 1451 
et seq.
    (h) Marine Protection, Research and Sanctuaries Act of 1972, as 
amended, 16 U.S.C. 1401 et seq.
    (i) Deepwater Port Act of 1974, as amended, 33 U.S.C. 1501 et seq.
    (j) Marine Mammal Protection Act of 1972, 16 U.S.C. 1361 et seq.



Sec. 161.12  Environmental effects abroad of major departmental actions.

    Departmental officials shall analyze actions under their cognizance 
with due regard for the environmental effects in the global commons and 
areas outside the jurisdiction of any nation and in foreign 
jurisdictions. Such analysis shall be prepared in accordance with 
separate Departmental procedures (Foreign Affairs Manual, Volume 2), 
dated September 4, 1979 for implementing Executive Order 12114, 
``Environmental Effects Abroad of Major Federal Actions'' (44 FR 1957), 
dated January 4, 1979.

[[Page 555]]



                   SUBCHAPTER R--ACCESS TO INFORMATION





PART 171--AVAILABILITY OF INFORMATION AND RECORDS TO THE PUBLIC--Table of Contents




                Subpart A--General Policy and Procedures

Sec.
171.1  Availability of information.
171.2  Requests for information.
171.3  Public reading room.
171.4  Extension of time limits.
171.5  Archival records.
171.6  Fees-general.

              Subpart B--Freedom of Information Provisions

171.10  Definitions.
171.11  Exemptions.
171.12  Time limits/expedited processing.
171.13  Fees.
171.14  Categories of requesters for fee purposes.
171.15  Fee waivers and appeals.
171.16  Predisclosure notification procedures for confidential 
          commercial information.

               Subpart C--Executive Order 12065 Provisions

171.20  Definitions.
171.21  Identifying information.
171.22  Access to records.
171.23  Determination in disputed cases.
171.24  Challenges to classification.
171.25  Former Presidential appointees.
171.26  Exemptions.

                      Subpart D--Privacy Provisions

171.30  Definitions.
171.31  Identifying information.
171.32  Exemptions.
171.33  Time limits.
171.34  Access to records.
171.35  Requests for amending records.

               Subpart E--Ethics in Government Provisions

171.40  Covered employees.
171.41  Identifying information.
171.42  Time limits.
171.43  Access to, and use of, reports.

                      Subpart F--Denial Procedures

171.50  Denials of access or of amendment.

                      Subpart G--Appeals Procedures

171.60  Appeal of denial of access to records.
171.61  Appeal of refusal to amend records.

                    Subpart H--Other Agency Material

171.70  Referral.
171.71  Concurrence.

    Authority:  5 U.S.C. 551 et seq., 552, 552a; 5 U.S.C. App. 201; 
E.O.12600, 52 FR 23781, 3 CFR, 1987 Comp., p. 235; E.O.12958, 60 FR 
19825, 3 CFR, 1995 Comp., p. 333.

    Source:  45 FR 58108, Sept. 2, 1980, unless otherwise noted.



                Subpart A--General Policy and Procedures



Sec. 171.1  Availability of information.

    (a) Unclassified information, documents, and forms which have 
previously been provided to the public as part of the normal services of 
the Department of State will continue to be made available on the same 
basis as before. Any Departmental officer who receives a request for 
records through normal channels of contact with the public, media, or 
the Congress which would not normally be made available shall advise the 
requester that the request will be referred to the Information and 
Privacy Coordinator, Foreign Affairs Information Management Center, for 
processing under the appropriate statute or executive order as provided 
in these regulations.
    (b) All identifiable records of the Department of State shall be 
made available to the public upon compliance with the procedures 
established in this subchapter, except to the extent that a 
determination is made to withhold a record in accordance with an 
appropriate exemption as provided herein.



Sec. 171.2  Requests for information.

    (a) Requests for identifiable records in accordance with this 
subchapter may be made by the public in person during regular business 
hours from the Department of State, 2201 C Street, NW., Washington, DC 
where the receptionist will refer the requester to the proper office for 
service and the necessary forms for making a request.
    (b) Requests by mail and referrals from other agencies should be 
addressed to the Information and Privacy

[[Page 556]]

Coordinator, Foreign Affairs Information Management Center, Room 1239, 
Department of State, Washington, DC 20520, who will coordinate action as 
specified in this request. In addition, requests may be directed to the 
Department's field offices and overseas posts; routine, unclassified, 
administrative records may be released to the individual if it is 
determined that such release is authorized. Any unfilled request shall 
be submitted to the Information and Privacy Coordinator. Individuals are 
urged to clearly indicate on their requests the statute under which they 
are requesting access to information; this notation will facilitate the 
processing of the request by the Department.
    (c) While every effort is made to guarantee the greatest possible 
access to all requesters, regardless of the specific statute under which 
the information is requested, the following guidance is provided for 
individuals in requesting records:
    (1) Freedom of Information Act. Requests for documents concerning 
the general activities of government and of the Department of State in 
particular (see subpart B).
    (2) E. O. 12065. Requests for mandatory review and declassification 
of Department records and requests for access by former Presidential 
appointees (see subpart C).
    (3) Privacy Act. Requests from U.S. citizens or resident aliens for 
records pertaining to themselves and maintained by the Department under 
the individual's name (see subpart D).
    (4) Ethics in Government Act. Requests for the financial Disclosure 
Statements of Department Employees covered by this Act (see subpart E).
    (d) The burden of adequately identifying the record so requested 
lies with the requester. Individuals may seek assistance regarding any 
facet of their requests from the Information and Privacy Coordinator.



Sec. 171.3  Public reading room.

    A public reading room or area where records may be made available is 
located in the Department of State, 2201 C Street, NW., Washington, DC 
20520. The receptionist will refer the applicant to the proper room. All 
those statutes, regulations, and guidelines pertaining to access to 
information required to be made available to the public shall be located 
in the reading room. Fees will not be charged for access by the public 
to this room or the indexes and regulations contained therein, but fees, 
in accordance with Sec. 171.6, will be charged for furnishing copies 
thereof. Persons desiring to utilize their own portable copying 
equipment should request approval in advance from the Information and 
Privacy Coordinator. Any arrangements for the use of such equipment must 
be consistent with security regulations of the Department of State and 
are subject to the availability of personnel to monitor such copying.



Sec. 171.4  Extension of time limits.

    While every effort is made to meet the time limits cited in each 
section of this subchapter, unusual circumstances may arise which would 
necessitate the extension of these time limits. Extensions shall be 
granted in those instances where it is necessary, in order to guarantee 
proper processing of the request, to:
    (a) Search for and collect the requested records from overseas posts 
or other establishments that are separate from the office processing the 
request;
    (b) Search for, collect, and appropriately examine a voluminous 
amount of separate and distinct records which are demanded in a single 
request; or
    (c) Consult with another agency having a substantial interest in the 
determination of the request or among two or more components of the 
Department of State having substantial subject matter interest therein. 
Such consultation shall be conducted with all practicable speed. In such 
instances the requester shall be given written notification by the 
Information and Privacy Coordinator of the extension of the time limit 
and the reason for such extension.



Sec. 171.5  Archival records.

    The Department ordinarily transfers custody of records as soon as 
practicable after they become twenty (20) years old to the National 
Archives and

[[Page 557]]

Records Service. These records are generally transferred in large blocks 
defined by years and/or major subject categories. Correspondence 
regarding access to these records should be addressed to the Chief, 
Diplomatic Branch, Civil Records Divisions, National Archives and Record 
Service, Washington, DC 20400.



Sec. 171.6  Fees-general.

    (a) The Department will charge a duplication fee of $.25 per page 
for copies of documents which are identified and made available to an 
individual pursuant to a request except, that there will be no charge 
for requests involving costs of $10.00 or less.
    (b) The Department will charge the actual cost of production for 
copies prepared by computer (such as tapes or printouts), including 
operator time.
    (c) The Department will charge the actual direct costs of producing 
the document(s) for methods of reproduction or duplication other than 
those described in paragraphs (a) and (b) of this section.
    (d) In those cases when estimated duplication charges are likely to 
exceed $25, the Department shall notify requesters of the estimated 
amount of fees, unless they have indicated in advance their willingness 
to pay fees as high as those anticipated. Such notice shall offer 
requesters the opportunity to confer with Department personnel with the 
objective of reformulating requests to meet their needs at lower costs.
    (e) Certification under the official seal that a copy or extract 
made from an official document is a true copy; the fee for certifying 
each copy of each page is $2.00.
    (f) The Department shall charge the actual costs for sending 
documents by special methods such as express mails, etc. when such is 
requested.
    (g) Remittances shall be in the form of either a personal check or 
bank draft drawn on a bank in the United States, a postal money order, 
or cash. Remittance shall be made payable to the order of the Treasurer 
of the United States and delivered or mailed to the Information and 
Privacy Coordinator, Foreign Affairs Information Management Center, Room 
1239, Department of State, 2201 C Street, NW., Washington, DC, 20520. 
The Department will assume no responsibility for cash sent by mail.
    (h) Fees must be paid in full prior to release of requested 
documents and/or provision of service described above.
    (i) A receipt for fees paid will be given only upon request.
    (j) See Sec. 171.13 for additional fees chargeable for Freedom of 
Information requests.
[52 FR 32123, Aug. 26, 1987]



              Subpart B--Freedom of Information Provisions



Sec. 171.10  Definitions.

    As used in this subpart, the following definitions shall apply:
    (a) The term identifiable means, in the context of a request for a 
record, a description which enables a professional employee of the 
Department who is familiar with the subject area of the request to 
locate the record with a reasonable amount of effort. Such a 
description, if possible, should include date, format, subject matter, 
country concerned, office of mission originating or receiving the 
record, and the name of any person to whom the record is known to 
relate.
    (b) The term record includes all books, papers, maps, photographs, 
or other documentary material, or copies thereof, regardless of physical 
form or characteristics, made in or receiving by the Department of State 
(including Foreign Service posts abroad) and preserved as evidence of 
the organization, functions, policies, decisions, procedures, 
operations, or other activities of the Department or the Foreign 
Service. It does not include copies of the records of other Government 
agencies (except those which have been expressly placed under the 
control of the Department of State upon termination of another agency), 
foreign government, international organizations, or non-governmental 
entities unless they evidence organization, functions, policies, 
decisions, procedures, operations, or activities of the Department of 
State. It does not include records not already in existence which would 
need

[[Page 558]]

to be created specifically to meet a request. It does not include 
records in the Berlin Document Center.
    (c) The term agency includes any executive department, military 
department, Government corporation, Government controlled corporation, 
or other establishment in the executive branch of the Government 
(including the Executive Office of the President), or any independent 
regulatory agency.
    (d) The term direct costs means those expenditures which the 
Department actually incurs in searching for and duplicating (and in the 
case of commercial requesters, reviewing) documents to respond to a FOIA 
request. Direct costs include, for example, the salary of the employee 
performing work (the basic rate of pay for the employee plus 16 percent 
of that rate to cover benefits) and the cost of operating duplicating 
machinery. Not included in direct costs are overhead expenses such as 
costs of space, and heating or lighting the facility in which the 
records are stored.
    (e) The term search includes all time spent looking for identifying 
and retrieving material that is responsive to a request, including page-
by-page or line-by-line identification of material within documents. The 
Department will attempt to ensure that searching for material is done in 
the most efficient and least expensive manner so as to minimize costs 
for both the Department and the requester. For example, the Department 
will not engage in line-by-line search when merely duplicating an entire 
document would prove the less expensive and quicker method of complying 
with a request. ``Search'' should be distinguished, moreover, from 
``review'' of material in order to determine whether the material is 
exempt from disclosure (see paragraph (g) of this section) Searches may 
be done manually or by computer using existing programming.
    (f) The term duplication refers to the process of making a copy of a 
document necessary to respond to a FOIA requst. Such copies can take the 
form of paper copy, microform, audio-visual materials, or machine 
readable documentation (e.g., magnetic tape or disk), among others.
    (g) The term review refers to the process of examining documents 
located to determine whether any portion of any document located is 
permitted to be withheld. It also includes processing any documents for 
disclosure, e.g., doing all that is necesssary to excise them and 
otherwise prepare them for release. Review does not include time spent 
resolving general, legal or policy issues regarding the application of 
exemptions.
    (h) The term commercial use request refers to a request from or on 
behalf of one who requests for information for a use or purpose that 
furthers the commercial, trade or profit interest of the requester or 
the person on whose behalf the request is made. In determining whether a 
requester belongs within this category, the Department will look at the 
use to which the requester will make of the documents requested.
    (i) The term educational institution refers to a preschool, a public 
or private elementary or secondary school, an institution of graduate 
higher education, an institution of undergraduate higher education, an 
institution of professional education, and an institution of vocational 
education, which operates a program or programs of scholarly research.
    (j) The term non-commerical scientific institution refers to an 
institution that is not operated on a ``commerical'' basis as that term 
is referenced in paragraph (h) of this section, and which is operated 
solely for the purpose of conducting scientific research, the results of 
which are not intended to promote any particular product or industry.
    (k) The term representative of the news media refers to any person 
actively gathering news for an entity that is organized and operated to 
publish or broadcast news to the public. The term news means information 
that is about current events or that would be of current interest to the 
public. Examples of news media entities include television or radio 
stations broadcasting to the public at large, and publishers of 
periodicals (but only in those instances when they can qualify as 
disseminators of ``news'') who make their products available for 
purchase or subscription by the general public. These examples

[[Page 559]]

are not intended to be all-inclusive. Moreover, as traditional methods 
of news delivery evolve (e.g., electronic dissemination of newspapers 
through telecommunications services), such alternative media would be 
included in this category. In the case of ``freelance'' journalists, 
they may be regarded as working for a news organization if they can 
demonstrate a likelihood of publication through that organization, even 
though not actually employed by it. Likelihood of publication can be 
demonstrated through, for example, a publication contract or past 
publication record. Similarly, the absence of a publication record, 
especially where the requester has previously received records from the 
Department as a ``representative of the news media'' will be taken into 
account in determining the likelihood of publication.
[45 FR 58108, Sept. 2, 1980, as amended at 52 FR 32124, Aug. 26, 1987]



Sec. 171.11  Exemptions.

    (a) The following categories of records maintained by the Department 
of State may be exempted from disclosure:
    (1) Records specifically authorized under criteria established by an 
executive order to be kept secret in the interest of national defense or 
foreign policy and in fact properly classified pursuant to such 
executive order.
    (2) Records related solely to the internal personnel rules and 
practices of an agency.
    (3) Records specifically exempted from disclosure by statute. 
Included in this category are records relating to the officers and 
employees of the Foreign Service, including efficiency records (sec. 612 
of the Foreign Service Act of 1946, as amended, 22 U.S.C. 986), the 
records of the Department of State or of diplomatic and consular 
officers of the United States pertaining to the issuance or refusal of 
visas or permits to enter the United States (sec. 222(f), of the 
Immigration and Nationality Act of 1952, as amended, 8 U.S.C. 1202(f)), 
``Restricted Data'' under section 224 of the Atomic Energy Act (42 
U.S.C. 2274), records of expenditures certified under 22 U.S.C. 2671 and 
31 U.S.C. 107, and records subject to section 102(d) of the National 
Security Act of 1947 (61 Stat. 498).
    (4) Records of trade secrets and commercial or financial information 
obtained from a person and privileged or confidential.
    (5) Records which are inter-agency or intra-agency memorandums, 
letters, telegrams, or airgrams which would not be available by law to a 
party other than an agency in litigation with the agency.
    (6) Records such as personnel and medical files and similar files 
the public disclosure of which would constitute a clearly unwarranted 
invasion of personal privacy.
    (7) Records or information compiled for law enforcement purposes, 
but only to the extent that the production of such law enforcement 
records or information--
    (i) Could reasonably be expected to interfere with enforcement 
proceedings;
    (ii) Would deprive a person of a right to a fair trial or an 
impartial adjudication;
    (iii) Could reasonably be expected to constitute an unwarranted 
invasion of personal privacy;
    (iv) Could reasonably be expected to disclose the identity of a 
confidential source, including a State, local, or foreign agency or 
authority or any private institution which furnished information on a 
confidential basis, and, in the case of a record or information compiled 
by a criminal law enforcement authority in the course of a criminal 
investigation, or by an agency conducting a lawful national security 
intelligence investigation, information furnished by a confidential 
source;
    (v) Would disclose techniques and procedures for law enforcement 
investigations or prosecutions, or would disclose guidelines for law 
enforcement investigations or prosecutions if such disclosure could 
reasonably be expected to risk circumvention of the law; or
    (vi) Could reasonably be expected to endanger the life or physical 
safety of any individual.
    (8) Records contained in or related to examination, operation, or 
condition reports prepared by, on behalf of, or for the use of an agency 
responsible for the

[[Page 560]]

regulation or supervision of financial institutions.
    (9) Geological or geophysical information and data, including maps, 
concerning wells.
    (b) Any reasonably segregable portion of a record shall be provided 
to any person requesting such record after deletion of the portions 
which are exempt under paragraph (a) of this section. Normally a portion 
of a record shall be considered reasonably segregable when segregation 
can produce an intelligible record which is not distorted out of context 
and does not contradict the record being withheld.
[45 FR 58108, Sept. 2, 1980, as amended at 52 FR 32124, Aug. 26, 1987]



Sec. 171.12  Time limits/expedited processing.

    (a) Whenever possible, the Department will furnish the requested 
records within 20 days (excluding Saturdays, Sundays, and legal public 
holidays), except as cited in Sec. 171.4.
    (b) A separate queue shall be established for requests meeting the 
test for expeditious processing. Requests for expedited processing shall 
be granted to the requester after the requester has demonstrated that a 
compelling need exists. A notice of the determination as to whether to 
grant expedited processing shall be provided to the requester within ten 
(10) days of the date of the request. The request for expedited 
processing shall set forth with specificity the relevant facts upon 
which the requester relies and demonstrate to the Department that 
substantive records relevant to the stated needs may exist and be deemed 
releasable.
    (c) A ``compelling need'' is deemed to exist where the requester can 
demonstrate one of the following:
    (1) Failure to obtain requested information on an expedited basis 
could reasonably be expected to pose an imminent threat to the life or 
physical safety of an individual;
    (2) The information is urgently needed by an individual primarily 
engaged in disseminating information in order to inform the public 
concerning actual or alleged Federal Government activity. News media 
requesters would normally qualify; however, other persons must 
demonstrate that their primary activity involves publishing or otherwise 
disseminating information to the public, not just a particular segment 
or group.
    (i) Urgently needed. The information has a particular value that 
will be lost if not disseminated quickly. Ordinarily this means a 
breaking news story of general public interest. However, information of 
historical interest only, or information sought for litigation or 
commercial activities would not qualify, nor would a news media 
publication or broadcast deadline unrelated to the newsbreaking nature 
of the information;
    (ii) Actual or alleged Federal Government activity. The information 
concerns some actions taken, contemplated, or alleged by or about the 
government of the United States, or one of its components or agencies, 
including the Congress;
    (3) Substantial due process rights of the requester would be 
impaired by the failure to process immediately; or
    (4) Substantial humanitarian concerns would be harmed by the failure 
to process immediately.
    (d) A demonstration of compelling need by a requester shall be made 
by a statement certified by the requester to be true and correct to the 
best of their knowledge. This statement must accompany the request in 
order to be considered and responded to within the ten (10) days 
required for decisions on expedited access.
    (e)(1) The Department's decision to deny expedition may be appealed 
to the Chief of the Requester Liaison Division, Room 1512, Department of 
State, 2201 C Street, NW., Washington, D.C. 20520. Appeals should 
contain as much information and documentation as possible to support the 
request for expedited processing in accordance with the criteria set 
forth in paragraph (c) of this section.
    (2) The Requester Liaison Division Chief will issue a final decision 
in writing within ten (10) days from the date on which the Department 
received the appeal.
[62 FR 48758, Sept. 17, 1997]



Sec. 171.13  Fees.

    (a) In addition to fees cited in Sec. 171.6, the following shall be 
applicable with

[[Page 561]]

respect to services rendered to members of the public under this 
subpart:
    (1) The following is the range of categories and average grade 
levels for employees within each category who perform the search and 
review functions involved in responding to a FOIA request:
    (i) Administrative/clerical (to include GS-1 through GS-8 or FS-9): 
GS-5/5 or FS-9/1.
    (ii) Professional (to include GS-9 through GS-13 or FS-5 through FS-
2): GS-11/5 or FS-4/4.
    (iii) Executive (to include GS-14 through SES or FS-2 through SFS): 
GS-15/1 or FS-1/1.
    (2) The salary rates for these categories will be calculated based 
on the rates published on the ``Department of State Salary Chart'' 
effective at the time that the function was actually performed; copies 
of this chart are available in the Public Reading Room. The actual fee 
schedule for each category will be included in the Department's 
acknowledgment letter.
    (3) The costs for manual search include the salary of the category 
of the employee who actually performed the search function (as provided 
in paragraph (a)(1) of this section) above plus an additional 16 percent 
of that rate to cover benefits.
    (4) The cost for computer searches will be calculated based on the 
salary of the category of the employee who actually performed the 
computer search (as provided in paragraph (a)(1) of this section) plus 
16 percent of that rate to cover benefits, in addition to the direct 
costs of the central processing unit, input-output devices, and memory 
capacity of the actual computer configuration.
    (5) Only requesters who are seeking documents for commercial use 
will be charged for time spent reviewing records to determine whether 
they are exempt from mandatory disclosure. The cost for review will be 
calculated based on the salary of the category of the employee who 
actually performed the review (as provided in paragraph (a)(1) of this 
section) plus 16 percent of the rate to cover benefits. Charges will be 
assessed only for the initial review (i.e., review undertaken the first 
time in order to analyze the applicability of specific exemption(s) to a 
particular record or portion of a record) and not for review at the 
administrative appeal level of the exemption(s) already applied.
    (6) If records requested under this subpart are stored elsewhere 
than the headquarters of the Department of State at 2201 C Street, NW., 
Washington, DC, the special cost of returning such records to the 
headquarters shall be included in the search costs. These costs will be 
computed at the actual costs of transportation of either a person or the 
requested record between the place where the record is stored and 
Department headquarters when, for time or other reasons, it is not 
feasible to rely on Government mail service or diplomatic pouch.
    (7) When no specific fee has been established for a service, or the 
request for a service does not fall under one of the above categories 
due to the amount or size or type thereof, the Information and Privacy 
Coordinator is authorized to establish an appropriate fee, pursuant to 
the criteria establsihed in Office of Management and Budget Circular No. 
A-25, entitled ``User Charges.''
    (b) Where it is anticipated that the fees chargeable under this 
subpart will amount to more than $25 and the requester has not indicated 
in advance her/his willingness to pay fees as high as anticipated, the 
requester shall be promptly notified of the amount of the anticipated 
fees or such portion thereof as can readily be estimated. The notice or 
request for an advance deposit shall extend an offer to the requester to 
confer with knowledgeable Departmental personnel in an attempt to 
reformulate the request in a manner which will reduce the fees and meet 
the needs of the requester. Dispatch of such a notice or request shall 
suspend the running of the period for response by the Department until a 
reply is received from the requester.
    (c) Search costs are due and payable even if the record which was 
requested cannot be located after all reasonable efforts have been made, 
or if the Department determines that a record which has been requested, 
but which is exempt from disclosure under this subpart, is to be 
withheld.

[[Page 562]]

    (d) The Department will begin assessing interest charges on an 
unpaid bill starting the 31st day following the day on which the billing 
was sent. The accrual of interest will be stayed upon receipt of the 
fee, rather than upon its processing by the Department. Interest will be 
at the rate prescribed in section 3717 of title 31 U.S.C.
    (e) A requester may not file multiple requests at the same time, 
each seeking portions of a document or documents, solely in order to 
avoid payment of fees. When the Department reasonably believes that a 
requester or a group of requesters acting in concert is attempting to 
break a request down into a series of requests for the purpose of 
evading the assessment of fees, the Department will aggregate any such 
requests and charge accordingly.
    (f) The Department will not require a requester to make an advance 
payment, i.e., payment before work is commenced or continued on a 
request, unless:
    (1) The Department estimates or determines that allowable charges 
that a requester may be required to pay are likely to exceed $250. Then, 
the Department will notify the requester of the likely cost and obtain 
satisfactory assurance of full payment where the requester has a history 
of prompt payment of FOIA fees, or require an advance payment of an 
amount up to the full estimated charges in the case of requesters with 
no history of payment; or
    (2) Requesters who have previously failed to pay fees charged in a 
timely fashion (i.e., within 30 days of the date of the billing), the 
Department will require such requesters to pay the full amount owed plus 
any applicable interest as provided above or demonstrate that they have, 
in fact, paid the fee, and to make an advance payment of the full amount 
of the estimated fee before the agency begins to process new requests or 
pending requests from such requesters.

When the Department acts under paragraph (f)(1) or (2) of this section, 
the administrative time limit prescribed in subsection (a)(6) of the 
FOIA (i.e., 10 working days from receipt of initial requests plus 
permissible extensions of that time limit) will begin only after the 
Department has received payments described above.
    (g) In accordance with the provisions and authorities of the Debt 
Collection Act of 1982 (Pub. L. 97-365), the Department reserves the 
right to disclose information to consumer reporting agencies and to use 
collection agencies, where appropriate, to encourage repayment.
[52 FR 32125, Aug. 26, 1987]



Sec. 171.14  Categories of requesters for fee purposes.

    There are four categories of requesters: commercial use requesters; 
educational and non-commercial scientific institutions; representatives 
of the news media; and all other requesters. The Act prescribes specific 
levels of fees for each of these categories. The Department will take 
into account information provided by requesters in determining their 
eligibility for inclusion in one of these categories is as defined in 
Sec. 171.10. It is in the requester's best interest to provide as much 
information as possible to demonstrate inclusion within a non-commercial 
category of fee treatment.
    (a) The Department will assess charges which recover the full direct 
costs of searching for, reviewing for release, and duplicating the 
records sought for commercial use. Commercial use requesters are 
entitled to neither two hours of free search time nor 100 free pages of 
reproduction of documents.
    (b) The Department will provide documents to educational and non-
commercial scientific institutions for the cost of reproduction alone, 
excluding charges for the first 100 pages. To be eligible for inclusion 
in this category, requesters must show that the request being made is 
authorized by, and under the auspices of, a qualifying institution and 
that the records are not sought for a commercial use, but are sought in 
furtherance of scholarly (if the request is from an educational 
institution) or scientific (if the request is from a non-commercial 
scientific institution) research.
    (c) The Department will provide documents to representatives of the 
news media for the cost of reproduction alone, excluding charges for the 
first

[[Page 563]]

100 pages. To be eligible for inclusion in this category, a requester 
must meet the criteria in Sec. 171.10(k), and the request must not be 
made for a commercial use. In reference to this class of requesters, a 
request for records supporting the news dissemination function of the 
requester shall not be considered to be a request that is for a 
commercial use.
    (d) The Department will charge requesters who do not fit into any of 
the categories above fees which recover the full reasonable direct cost 
of searching for and reproducing records that are responsive to the 
request, except that the first 100 pages of reproduction and the first 
two hours of search time shall be furnished without charge. Moreover, 
requests from record subjects for records about themselves will continue 
to be treated under the fee provisions of the Privacy Act of 1974 which 
permit fees only for reproduction.
    (e) In making determinations under this section, the Department may 
take into account whether requesters who previously were granted (b), 
(c), or (d) status did in fact use the requested records for purposes 
compatible with the status accorded them.
[52 FR 32125, Aug. 26, 1987]



Sec. 171.15  Fee waivers and appeals.

    (a) Waiver or reduction of any fee provided for in Secs. 171.6 and 
171.13 may be made upon a determination by the Chief of the Request 
Processing Section, Room 1239, Department of State, 2201 C Street, NW., 
Washington, DC 20520. The Department shall furnish documents without 
charge or at a reduced charge provided that: Disclosure of the 
information is in the public interest because it is likely to contribute 
significantly to public understanding of the operations or activities of 
the government, and is not primarily in the commercial interst of the 
requester. Requests for a waiver or reduction of fees shall be 
considered on a case-by-case basis.
    (1) In order to determine whether disclosure of the information is 
in the public interest because it is likely to contribute significantly 
to public understanding of the operations or activities of the 
government, the Department will consider the following four factors:
    (i) The subject of the request: Whether the subject of the requested 
records concerns the operations or activities of the government;
    (ii) The informative value of the information to be disclosed: 
Whether the disclosure is likely to contribute to an understanding of 
government operations or activities;
    (iii) The contribution to an understanding of the subject by the 
general public likely to result from disclosure: Whether disclosure of 
the requested information will contribute to public understanding; and
    (iv) The significance of the contribution to public understanding: 
Whether the disclosure is likely to contribute significantly to public 
understanding of government operations or activities.
    (2) In order to determine whether disclosure of the information is 
not primarily in the commercial interest of the requester, the 
Department will consider the following two factors:
    (i) The existence and magnitude of a commercial interest: Whether 
the requester has a commercial interest that would be furthered by the 
requested disclosure; and, if so
    (ii) The primary interest in disclosure: Whether the magnitude of 
the identified commercial interest of the requester is sufficiently 
large, in comparison with the public interest in disclosure, that 
disclosure is primarily in the commercial interest of the requester.
    (b) The Department will not consider waiver or reduction of fees for 
requesters (persons or organizations) from whom unpaid fees remain due 
to the Department for another information access request.
    (c) (1) The Department's decision to refuse to waive or reduce fees 
as requested under paragraph (a) of this section may be appealed to the 
Chief of the Information Access Branch, Room 1239, Department of State, 
2201 C Street NW., Washington, DC 20520. Appeals should contain as much 
information and documentation as possible to support the request for a 
waiver or reduction of fees.
    (2) Appeals will be reviewed by the Information Access Branch Chief 
who

[[Page 564]]

may consult with other officials of the Department as appropriate. The 
requester will be notified within thirty working days from the date on 
which the Department received the appeal.
[52 FR 32126, Aug. 26, 1987]



Sec. 171.16  Predisclosure notification procedures for confidential commercial information.

    (a) In general. Confidential commercial information provided to the 
Department shall not be disclosed pursuant to a Freedom of Information 
Act request except in accordance with this section. For purposes of this 
section, the following definitions apply:
    (1) Confidential Commercial Information means records provided to 
the Department by a submitter that arguably contain material exempt from 
release under Exemption 4 of the Freedom of Information Act, 5 U.S.C. 
552(b)(4), because disclosure could reasonably be expected to cause 
substantial competitive harm.
    (2) Submitter means any person or entity who provides confidential 
commercial information to the Department. The term submitter includes, 
but is not limited to, corporations, state governments, and foreign 
governments.
    (b) Notice to submitters. Whenever the Department receives a Freedom 
of Information Act request for confidential commercial information and, 
pursuant to paragraph (c) of this section, the submitter is entitled to 
receive notice of that request, the Department shall promptly notify the 
submitter that it has received the request, unless such notice is 
excused under paragraph (g) of this section. The notice shall be in 
writing and either describe the exact nature of the confidential 
commercial information requested or provide a copy of the records or 
portion of the records containing the confidential commercial 
information. The notice shall be addressed to the submitter and mailed, 
postage prepaid, first class mail, to the submitter's last known 
address. Where notice is required to be given to a voluminous number of 
submitters, in lieu of mailing the notice may be posted or published in 
a manner and place reasonably calculated to provide notice to the 
submitters.
    (c) When notice required. (1) For confidential commercial 
information submitted prior to January 1, 1988, the Department shall 
provide a submitter with notice of a receipt of a Freedom of Information 
Act request whenever:
    (i) The records are less than ten (10) years old and the information 
has been designated by the submitter as confidential commercial 
information; or
    (ii) The Department has reason to believe that the disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm.
    (2) For confidential commercial information submitted to the 
Department on or after January 1, 1988, the Department shall provide a 
submitter with notice of receipt of a Freedom of Information Act request 
whenever:
    (i) The submitter has designated the information as confidential 
commercial information pursuant to the requirements of this section; or
    (ii) The Department has reason to believe that the disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm.
    (3) Notice of a request for confidential commercial information 
falling within paragraph (c)(2)(i) of this section shall be required for 
a period of not more than ten (10) years after the date of submission 
unless the submitter provides reasonable justification for a designated 
period of greater duration.
    (4) A submitter shall use good-faith efforts to designate by 
appropriate markings, either at the time a record is submitted to the 
Department or within a reasonable period of time thereafter, those 
portions of the record which it deems to contain confidential commercial 
information. The designation shall be accompanied by a certification 
made by the submitter, its agent or designee, that to the best of the 
submitter's knowledge, information and belief, the record does, in fact, 
contain confidential commercial information that theretofore has not 
been disclosed to the public.
    (5) Whenever the Department provides notice to the submitter in 
accordance with paragraph (c) of this section, the Department shall at 
the same time provide written notice to the requester that it has done 
so.

[[Page 565]]

    (d) Opportunity to object to disclosure. To the extent permitted by 
law, the notice required by paragraph (c) of this section shall afford a 
submitter a reasonable period of time within which the submitter or its 
authorized representative may provide the Department with a written 
objection to the disclosure of the confidential commercial information. 
The objection shall set forth in detail all grounds for withholding 
information and demonstrate why the submitter believes that the records 
contain confidential commercial information. Except where a 
certification already had been made in conformance with the requirements 
of paragraph (c)(4) of this section, the objection shall be accompanied 
by a certification made by the submitter, its agent or designee, that to 
the best of the submitter's knowledge, information and belief, the 
record does, in fact, contain confidential commercial information that 
theretofore has not been disclosed to the public. Information provided 
by a submitter pursuant to this paragraph may itself be subject to 
disclosure under the Freedom of Information Act.
    (e) Notice of intent to disclosure. (1) The Department shall give 
careful consideration to objections made by a submitter pursuant to 
paragraph (d) of this section prior to making any administrative 
determination of the issue. Whenever the Department decides to disclose 
information over the objection of a submitter, the Department shall 
forward to the submitter a written notice which shall include:
    (i) A statement of the reasons for which the submitter's disclosure 
objections were not sustained;
    (ii) A description of the information to be disclosed; and
    (iii) A specified disclosure date.
    (2) To the extent permitted by law, the notice required to be given 
by paragraph (e)(1) of this section shall be provided to the submitter a 
reasonable number of days prior to the specified disclosure date.
    (3) Whenever the Department provides notice to the submitter in 
accordance with paragraphs (e)(1) and (e)(2) of this section, the 
Department shall at the same time notify the requester that such notice 
has been given and the proposed date for disclosure.
    (f) Notice of lawsuit. Whenever a requester brings suit seeking to 
compel the disclosure of information for which notice is required 
pursuant to paragraph (c) of this section, the Department shall promptly 
notify the submitter that such suit has been filed.
    (g) Exceptions to notice requirements. The notice requirements of 
this section shall not apply if:
    (1) The Department determines that the information should not be 
disclosed;
    (2) The information has been published or has been officially made 
available to the public;
    (3) Disclosure of the information is required by law (other than 5 
U.S.C. 552);
    (4) Disclosure of the information is required by a Department rule 
that:
    (i) Was adopted pursuant to notice and public comment;
    (ii) Specifies narrow classes of records submitted to the agency 
that are to be released under the Freedom of Information Act; and
    (iii) Provides in exceptional circumstances for notice when the 
submitter provides written justification, at the time the information is 
submitted or a reasonable time thereafter, that disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm;
    (5) The information requested was not designated by the submitter as 
exempt from disclosure in accordance with paragraph (c) of this section, 
when the submitter had an opportunity to do so at the time of submission 
of the information or a reasonable time thereafter, unless the 
Department has substantial reason to believe that the disclosure of the 
information would result in competitive harm; or
    (6) The designation made by the submitter in accordance with 
paragraph (c) of this section appears obviously frivolous; except that, 
in such case, the Department must provide the submitter with written 
notice of any final administrative disclosure determination within a 
reasonably number of days prior to the specified disclosure date.
[55 FR 9318, Mar. 13, 1990]

[[Page 566]]



               Subpart C--Executive Order 12065 Provisions



Sec. 171.20  Definitions.

    As used in this subpart, the following definitions shall apply:
    (a) The term agency means Federal agency including department, 
agency, commission, etc., as defined in 5 U.S.C. 552(e).
    (b) The term classification refers to the determination that certain 
information requires protection against unauthorized disclosure in the 
interest of national security, coupled with the designation of the level 
of classification: Top Secret, Secret or Confidential.
    (c) The term classification authority means the authority vested in 
an official of an agency to orginally classify information or material 
which is determined by that official to require protection against 
unauthorized disclosure in the interest of national security. It is also 
the authority to prolong classification.
    (d) The term classified information means information or material, 
herein collectively termed information, that is owned by, produced for 
or by, or under the control of the United States Government, and that 
has been determined pursuant to Executive Order 12065, prior orders, or 
other orders or statutes, to require protection against unauthorized 
disclosure, coupled with the designation of the level of classification.
    (e) The term declassification refers to the determination that 
particular classified information no longer requires protection against 
unauthorized disclosure in the interest of national security. Such 
determination shall be by specific action or automatically after the 
lapse of a requisite period of time or the occurrence of a specified 
event. If such determination is by specific action, the material shall 
be so marked with the new designation.
    (f) The term document has the meaning of ``record'' as set forth in 
Sec. 171.10(b).
    (g) The term foreign government information is: (1) Information 
provided to the United States by a foreign government or international 
organization of governments in the expectation, express or implied, that 
the information is to be kept in confidence, or (2) information, 
requiring confidentiality, produced by the United States pursuant to a 
written joint arrangement with a foreign government or international 
organization of governments. A written joint arrangement may be 
evidenced by an exchange of letters, a memorandum of understanding, or 
other written record of the joint arrrangement.
    (h) The term Presidential appointees includes former officials of 
the Department of State or other U.S. Government agencies who held 
policy positions and were appointed by the President, by and with the 
advice and consent of the Senate, at the level of Ambassador, Assistant 
Secretary of State, or above. It does not include Foreign Service 
Officers as a class or persons who merely received assignment 
commissions as Foreign Service Officers, Foreign Service Reserve 
Officers, Foreign Service Staff Officers and employees.



Sec. 171.21  Identifying information.

    For the request to be processed, it must describe the material 
sufficiently to enable a professional employee of the Department who is 
familiar with the subject area of the request to locate the record with 
a reasonable amount of effort. Whenever a request does not reasonably 
describe the information, the requester shall be notified that unless 
additional information is provided, or the scope of the request is 
narrowed, no further action will be taken.



Sec. 171.22  Access to records.

    All classified information except as noted in Sec. 171.23, shall be 
subject to review for declassification upon request of a member of the 
public, a government employee, or an agency.
    (a) A request for declassification under the Order shall be acted 
upon within 60 days from the date on which the request reaches the 
appropriate receiving office.
    (b) Subject to paragraph (f) of this section, when it receives a 
request, the Department, if it is the originating agency, shall 
determine whether the information or any reasonably segregable portion 
of it no longer requires

[[Page 567]]

protection. If so, the Department shall promptly make such information 
available to the requester, unless withholding it is otherwise warranted 
under applicable law.
    (c) When the Department receives a request for information in a 
document which is in its custody, but which was classified by another 
agency, it shall refer the request to the appropriate agency for review. 
The Department shall also notify the requester of the referral unless 
the association of the reviewing agency with the information requires 
protection in the interest of national security. The reviewing agency 
shall respond directly to the requester and shall notify the Department 
of its determination.
    (d) During the transition period allowed by Executive Order 12065 
from declassification at 30 years to declassification at 20 years, all 
requests for classified United States Government originated information 
over 30 years old not previously declassified and transferred to the 
Archives will be processed according to paragraphs (b) and (c) of this 
section.
    (e) In response to a request for a classified document in its 
possession, the Department may not refuse to confirm the existence or 
non-existence of the document unless the fact of its existence or non-
existence would itself be classifiable.
    (f) In the case of requests for documents containing foreign 
government information, the Department, if it is also the agency which 
initially received the foreign government information, shall determine 
whether the foreign government information in the document may be 
declassified and released in accordance with policies or guidelines, 
consulting with other interested agencies as necessary. If the 
Department is not the agency which received the foreign government 
information, it shall refer the request to the original receiving 
agency, which shall take action on the request.
    (g) In considering requests for mandatory review, the Department may 
decline to review again any request for material which has been reviewed 
within one year and denied, except as the request constitutes an appeal 
under subpart G of this subchapter.



Sec. 171.23  Determination in disputed cases.

    (a) Information that continues to meet the legal requirements for 
classification under section 1-3 of the Order at the time of review for 
declassification is presumed to require continued protection and may be 
withheld from disclosure under the Order and section (b)(1) of the 
Freedom of Information Act. However, as stated in section 3-303 of the 
Order, it is government policy to consider the public interest in 
disclosure when information is reviewed for declassification. In some 
cases, the need to protect information that continues to meet the 
requirements of classification may be outweighed by the public interest 
in disclosure of information. When such a question arises, the authority 
reviewing the information shall refer the question to the relevant Top 
Secret authority in the Department of State to make a policy 
determination whether the public interest in disclosure outweighs the 
damage to the national security that might reasonably be expected from 
the disclosure. In making such determination, that authority shall 
respect the intent of the Order to protect foreign government 
information and confidential foreign sources. That authority shall also 
consult with other officials in the agency as the circumstances warrant.
    (b) In the Department of State, if such a case is appealed by the 
requester of the information after receiving a notice of denial, the 
case shall be referred to the Appeals Review Panels in accordance with 
the Department's appeal procedures. If the Panel should decide that the 
case raises a question as to whether the need to protect information 
that continues to meet the requirements of classification is outweighed 
by the public interest in disclosure, the question shall be referred to 
a principal officer for determination.



Sec. 171.24  Challenges to classification.

    (a) A government employee, who has reasonable cause to believe that 
a document is classified unnecessarily, improperly, or for an 
inappropriate period of time, is encouraged to and shall

[[Page 568]]

have the right to challenge such classification.
    (b) The challenger shall prepare a statement giving the reasons to 
support such a challenge, and may submit a request to the office or 
bureau of origin for a review of the document under the mandatory 
declassification procedures of the agency, expect that the agency shall 
reach a determination in 30 days instead of 60 days. If the reviewing 
office or bureau agrees with the challenger, rectifying changes shall be 
made on the face of the document. The office of the record holder and 
other holders should be notified of the changes to the extent 
practicable. If the reviewing office disagrees with the challenger, the 
challenger may appeal within 60 days to the Chairman of the Appeals 
Review Panels, who shall obtain a decision from one of the Panels, 
within 30 days of receipt of the appeal.
    (c) If the challenger wishes to remain anonymous, an officer 
designated by the chairman of the Appeals Review Panels shall act as the 
challenger's agent.



Sec. 171.25  Former Presidential appointees.

    (a) Former Presidential appointees may have access to those 
documents (classified and unclassified) they oiginated, reviewed, or 
signed only while serving as Presidential appointees. Requests should be 
submitted in writing to the Information and Privacy Coordinator and 
should include a general description of the records and the time period 
covered by the request. Access shall be granted under the following 
conditions:
    (1) The Department must first determine that granting access to the 
requested material is consistent with the interests of national 
security;
    (2) The former Presidential appointee must agree in writing to 
safeguard the information from unauthorized disclosure;
    (3) The former Presidential appointee must submit a statement 
authorizing the Department to review any notes and manuscripts to 
determine that they contain no classified information;
    (4) The information may not be further disseminated without the 
express permission of the Department;
    (5) If the former Presidential appointee uses a research assistant, 
this person must also meet all of the above conditions. Such a personal 
assistant must be working for the former Presidential appointee and not 
gathering information for publication on her or his own.
    (b) If the access requested by former Presidential appointees 
requires services for which fair and equitable fees may be charged 
pursuant to title 5 of the Independent Offices Appropriations Act, 65 
Stat. 290, 31 U.S.C. 483a (1976), the requester shall be so notified and 
the fees may be charged pursuant to that Act; the requester shall be so 
notified and the fees may be imposed.



Sec. 171.26  Exemptions.

    (a) Information less than 10 years old which was originated by the 
President, by the White House staff, or by committees or commissions 
appointed by the President, or by other action on behalf of the 
President, is exempted from mandatory review for declassification. 
Requests for mandatory review of information more than 10 years old of 
the origin described shall be processed in accordance with procedures 
developed by the Archivist of the United States. These procedures will 
provide for consultation with agencies having primary subject matter 
interest, who will provide the Archivist their recommendations as to the 
disposition of the request. Any decision by the Archivist may be 
appealed to the Director of the Information Security Oversight Office. 
Agencies with primary subject matter interest will be notified promptly 
of the Director's decision on such appeals and may further appeal to the 
National Security Council. The information shall remain classified until 
the appeal is decided or until one year from the date of the Director's 
decision, whichever comes first.
    (b) The Freedom of Information and Privacy Acts exemptions and any 
other exemptions under applicable law may be invoked by the Department 
to deny material on grounds other than classification.

[[Page 569]]



                      Subpart D--Privacy Provisions



Sec. 171.30  Definitions.

    As used in this subpart, the following definitions shall apply:
    (a) The term Department means the Department of State, its offices, 
bureaus, divisions, field offices, and its overseas posts.
    (b) The term individual means a citizen of the United States or an 
alien lawfully admitted for permanent residence.
    (c) The term maintain includes maintain, collect, use or 
disseminate.
    (d) The term record means any item, collection, or grouping of 
information about an individual that is maintained by the Department, 
including, but not limited to education, financial transactions, medical 
history, and criminal or employment history that contains the 
individual's name, or the identifying number, symbol, or other 
identifying particular assigned to the individual, such as a finger or 
voice print or photograph.
    (e) The term system of records means a group of any records under 
the control of the Department from which information is retrieved by the 
name of the individual or by some identifying number, symbol, or other 
identifying particular assigned to an individual.
    (f) The term statistical record means a record in a system of 
records maintained for statistical research or reporting purposes only 
and not used in whole or in part in making any determination about an 
identifiable individual, except as provided in 13 U.S.C. 8.
    (g) The term routine use means, with respect to the disclosure of a 
record, the use of such record for a purpose which is compatible with 
the purpose for which it was collected.
    (h) The term amend means to make any correction to any portion of 
the record which the individual believes is not accurate, relevant, 
timely, or complete.
    (i) The term personnel record means any personal information 
maintained in a system of records as defined in paragraph (e) of this 
section that is needed for personnel management programs or processes 
such as staffing, employee development, retirement, grievances, and 
appeals.

Rules and procedures promulgated by the Office of Personnel Management 
under the Privacy Act for personal records for which it has 
responsibility will be followed by the Department with regard to such 
records except when inconsistent with provisions of the Foreign Service 
Act.



Sec. 171.31  Identifying information.

    All requests for access to a record or records must reasonably 
describe the system of records and the individual's record within the 
system in sufficient detail to permit identification of the requested 
record(s). System names, descriptions, and the identifying information 
required for each system are published in the Department's public notice 
of systems of records appearing in the Federal Register. As a minimum, 
requests should include the individual's full name (maiden name, if 
appropriate), present mailing address (including zip code), date and 
place of birth, and other information helpful in identifying the record. 
Helpful data includes circumstances which give the individual reason to 
believe that the Department of State maintains records under her/his 
name, as well as the approximate time period of the records. This 
information will facilitate the timely search of record systems and 
assist the Department in locating those records which actually pertain 
to the individual requester. In certain instances, it may be necessary 
for the Department to request additional information from the requester, 
either to ensure a full search or to ensure that a record retrieved does 
in fact pertain to the individual.



Sec. 171.32  Exemptions.

    Portions of systems of records maintained by the Department are 
authorized to be exempted from a limited number of provisions of the 
Privacy Act. In utilizing these exemptions, however, the Department 
contemplates exempting only those portions of systems necessary for the 
proper functioning of the Department and which are consistent with the 
Privacy Act and these regulations. The following exemptions are 
authorized under 5 U.S.C. 552a(j) and (k):

[[Page 570]]

    (a) Records specifically authorized under criteria established by an 
executive order to be kept secret in the interest of national defense or 
foreign policy and in fact, properly classified pursuant to such 
executive order (k)(1);
    (b) Investigatory material compiled for law enforcement purposes, 
other than material within the scope of 5 U.S.C. 552a(j)(2): Provided, 
however, That if any individual is denied any right, privilege, or 
benefit for which she or he would otherwise be eligible as a result of 
the maintenance of such material, such material shall be provided to 
such individual, except to the extent that the disclosure of such 
material would reveal the identity of a source who furnished information 
to the Government under an express promise that the identity of the 
source would be held in confidence, or, prior to the effective date of 
the regulations, under an implied promise that the identity of the 
source would be held in confidence (k)(2);
    (c) Records maintained in connection with providing protective 
services to the President of the United States or other individuals, 
pursuant to 18 U.S.C. 3056 and 22 U.S.C. 2666 (k)(3);
    (d) Records required by statute to be maintained and used solely as 
statistical records (k)(4);
    (e) Investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, nominations or 
referrals to international organizations, or access to classified 
information, but only to the extent that the disclosure of such material 
would reveal the identity of a source who furnished information to the 
Government under an express promise that the identity of the source 
would be held in confidence, or, prior to the effective date of these 
regulations, under an implied promise that the identity of the source 
would be held in confidence (k)(5);
    (f) Testing or examination material used solely to determine 
individual qualification for appointment or promotion to the Federal 
service which would compromise the objectivity or fairness of the 
testing or examinations process if disclosed (k)(6); or
    (g) Evaluation material used to determine potential of an individual 
for promotion in the armed services, but only to the extent that the 
disclosure of such material would reveal the identity of a source who 
furnished information to the Government under an express promise that 
the identity of the source would be held in confidence, or, prior to the 
effective date of these regulations, under an implied promise that the 
identity of the source would be held in confidence (k)(7); or
    (h) Records originated by another agency when that agency has 
determined that the record is exempt under 5 U.S.C. 52a (j). Also, 
pursuant to Section (j)(2) of the Act, records compiled by the Special 
Assignment Staff, the Command Center, and the Passport and Visa Fraud 
Branch of the Office of Security and by the inspector General may be 
exempted from the requirements of any part of the Act except subsections 
(b), (c)(1) and (2), (e)(4) (A) through (F), (e)(6), (7), (9), (10), and 
(11), and (i) to the extent necessary to assure the effective completion 
of the investigative and judicial processes.
    (i) Portions of the following systems of records are exempted under 
5 U.S.C 552a(j) to the extent authorized and determined by the agency 
originating the records. The names of the systems correspond to those 
published in the Federal Register by the Department.

System Name: STATE DEPT.
Consular Service and Assistance Records. STATE-5.
Coordinator for Combatting Terrorism Records. STATE-6.
External Research Records. STATE-10.
Extradition Records. STATE-11.
Intelligence and Research Records. STATE-15.
International Organizations Records. STATE-17.
Law of the Sea Records. STATE-19.
Overseas Records. STATE-25.
Passport Records. STATE-26.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personality Index to the Central Foreign Policy Records. STATE-29.
Security Records. STATE-36.
Visa Records. STATE-39.
Munitions Control Records. STATE-42.

[[Page 571]]

Records of the Inspector General and Automated Individual Cross-
    Reference System. STATE-53.

    (j) Portions of the following systems of records are exempted from 5 
U.S.C. 552a(c)(3), (d), (e)(1), (3) and (4), (G), (H), and (I), and (f). 
The names of the systems correspond to those published in the Federal 
Register by the Department.
    (1) Exempt under 5 U.S.C. 552a(k)(1). The reason for invoking the 
exemption is to protect the material required to be kept secret in the 
interest of national defense and foreign policy.

Board of Appellate Review Records. STATE-2.
Consular Service and Assistance Records. STATE-5.
Coordinator for Combatting Terrorism Records. STATE-6.
External Research Records. STATE-10.
Extradition Records. STATE-11.
Foreign Assistance Inspection Records. STATE-48.
Intelligence and Research Records. STATE-15.
International Organizations Records. STATE-17.
Law of the Sea Records. STATE-19.
Overseas Records. STATE-25.
Passport Records. STATE-26.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personality Index to the Central Foreign Policy Records. STATE-29.
Security Records. STATE-36.
Visa Records. STATE-39.
Berlin Document Center. STATE-41.
Munitions Control Records. STATE-42.
Records of the Inspector General and Automated Individual Cross-
    Reference System. STATE-53.
Records of the Office of the Assistant Legal Adviser for International 
    Claims and Investment Disputes. STATE-54.

    (2) Exempt under 5 U.S.C. 552(a)(k)(2). The reasons for invoking the 
exemptions are to prevent individuals the subject of investigation from 
frustrating the investigatory process, to insure the integrity of law 
enforcement activities, to prevent disclosure of investigative 
techniques, to maintain the confidence of foreign governments in the 
integrity of the procedures under which privileged or confidential 
information may be provided; and to protect the confidentiality of 
sources of information.

Board of Appellate Review Records. STATE-2.
Consular Service and Assistance Records. STATE-5.
Coordinator for Combatting Terrorism Records. STATE-6.
Extradition Records. STATE-11.
Foreign Assistance Inspection Records. STATE-48.
Intelligence and Research Records. STATE-15.
Overseas Records. STATE-25.
Passport Records. STATE-26.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personality Index to the Central Foreign Policy Records. STATE-29.
Security Records. STATE-39.
Visa Records. STATE-39.
Munitions Control Records. STATE-42.
Records of the Inspector General and Automated Individual Cross-
    Reference System. STATE-53.
Garnishment of Wages Records. STATE-61.

    (3) Exempt under 5 U.S.C. 552(a)(k)(3). The reason for invoking this 
exemption is to preclude impairment of the Department's effective 
performance in carrying out its lawful protective responsibilities under 
18 U.S.C. 3056 and 22 U.S.C. 1666.

Consular Service and Assistance Records. STATE-5.
Extradition Records. STATE-11.
Intelligence and Research Records. STATE-15.
Overseas Records. STATE-25.
Passport Records. STATE-26.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personality Index to the Central Foreign Policy Records. STATE-29.
Security Records. STATE-36.
Visa Records. STATE-39.

    (4) Exempt under 5 U.S.C. 552a(k)(4). The reason for invoking this 
exemption is to avoid needless consideration of records which are used 
solely for statistical purposes and from which no individual 
determinations are made.

Foreign Service Institute Records. STATE-14.

[[Page 572]]

Personnel Payroll Records. STATE-30.
Personnel Records. STATE-31.

    (5) Exempt under 5 U.S.C. 552a(k)(5). The reasons for invoking this 
exemption are to insure the proper functioning of the investigatory 
process, to insure effective determination of stability, eligibility and 
qualification for employment and to protect the confidentiality of 
sources of information.

Board of the Foreign Service Records. STATE-3.
Equal Employment Opportunity Records. STATE-9.
Foreign Assistance Inspection Records. STATE-48.
Foreign Service Grievance Board Records. STATE-13.
Legal Adviser Personnel Records. STATE-20.
Overseas Records. STATE-25.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personnel Records. STATE-31.
Security Records. STATE-36.
Senior Personnel Appointment Records. STATE-47.
Records of the Inspector General and Automated Individual Cross-
    Reference System. STATE-53.

    (6) Exempt under 5 U.S.C. 552(k)(6). The reasons for invoking this 
exemption are to prevent the compromise of testing or evaluation 
material used solely to determine individual qualifications for 
employment or promotion, and to avoid giving unfair advantage to 
individuals by virtue of their having access to such material.

Foreign Service Institute Records. STATE-14.
Personnel Records. STATE-31.

    (7) Exempt under 5 U.S.C. 552a(k)(7). The reason for invoking this 
exemption is to prevent access to such material maintained from time to 
time by the Department in connection with various military personnel 
exchange programs.

Overseas Records. STATE-25.
Personality Cross Reference Index to the Secretariat Automated Data 
    Index. STATE-28.
Personality Index to the Central Foreign Policy Records. STATE-29.
Personnel Records. STATE-31.

    (k) Portions of certain documents in the following systems of 
records are exempted pursuant to the provisions of 5 U.S.C. 552a (j) and 
(k) from subsections (c) (3) and (4); (d); (e)(4), (G), (H), and (f) of 
5 U.S.C. 552a.

Public Affairs Records. STATE-35.
Privacy Act Requests Records. STATE-40.
[45 FR 58108, Sept. 2, 1980; 45 FR 62426, Sept. 19, 1980, as amended at 
56 FR 6969, Feb. 21, 1991; 59 FR 2521, Jan. 18, 1994; 61 FR 68149, Dec. 
27, 1996]



Sec. 171.33  Time limits.

    Whenever possible, the Department will acknowledge the request 
within 10 days (excluding Saturdays, Sundays, and legal public holidays) 
of receipt of the request and furnish the requester information as soon 
as possible thereafter.



Sec. 171.34  Access to records.

    (a) Verification of personal identity. The Department will require 
reasonable identification of individuals to assure that records are 
disclosed only to the proper person(s).
    (1) Access in person. When access to a record is granted in person, 
the Department will require a verification of identity by the 
individual; employee identification card, driver's license, medicare 
card, annuitant identification, or passport are examples of acceptable 
identification.
    (2) Access by mail. For individuals who seek access by mail, the 
Department will require verification of identity; comparison of 
signature of the requester and those in the record, if any, will be used 
to determine identity.
    (3) Statement verifying identity. If an individual can provide no 
suitable documents for identification or a signature is not on record, 
the Department will require a signed statement from the individual 
asserting her or his identity and stipulating that the individual 
understands that knowingly or willingly seeking or obtaining access to 
records about another individual under false pretenses is punishable by 
a fine of up to $5,000.
    (b) Sensitive records. In certain cases where the Department 
determines that the requested record is of sufficient

[[Page 573]]

sensitivity, it may require the individual to furnish a signed notarized 
statement verifying the requester's identity. The Department will inform 
the individual at the time the record is retrieved whether or not such a 
statement is necessary.
    (c) Accompanying individual. If, when exercising physical access to 
a record, the requester is accompanied by any other person, the 
Department will require the requester to sign a statement authorizing 
disclosure of the contents of record in the presence of the accompanying 
individual.
    (d) Authorized representatives or designees. When an individual 
wishes to authorize another person or persons access to her or his 
records other than as provided in paragraph (e) of this section, the 
individual shall submit a signed, notarized statement authorizing and 
consenting to access by a designated person or persons.
    (e) Guardians. The parent(s) of any minor, or the legal guardian of 
an individual who has been declared to be incompetent due to physical or 
mental incapacity or age by a court of competent jurisdiction, may act 
for and on behalf of said individual upon presentation of appropriate 
documentation of such relationship.
    (f) Medical records. If, in the judgment of the Deputy Assistant 
Secretary of State for Medical Services or her/his designee, the release 
of medical information directly to the requester could have an adverse 
effect on the requester, the aforementioned officer will attempt to 
arrange an acceptable alternative in granting access to such record(s). 
This will normally involve the release of such information to a doctor 
named by the requester.
    (g) Records relating to civil actions or proceedings. The 
requirements of this section do not entitle an individual to the right 
of access to any information compiled in reasonable anticipation of a 
civil action or proceeding.



Sec. 171.35  Requests for amending records.

    (a) An individual has the right to request that the Department amend 
a record pertaining to her or him which the individual believes is not 
accurate, relevant, timely, or complete. At the time the Department 
grants access to a record it will also furnish guidelines for requesting 
amendments to the record. These guidelines will also be available in the 
public reading room in the Department of State, Washington, DC between 
10 a.m. and 4 p.m. Monday through Friday, except for legal public 
holidays, or may be obtained by writing the Information and Privacy 
Coordinator, Foreign Affairs Information Management Center, Department 
of State, Room 1239, Washington, DC 20520.
    (b) Requests for amending records must be in writing and mailed or 
delivered to the Information and Privacy Coordinator, Foreign Affairs 
Information Management Center, Department of State, Room 1239, 
Washington, DC 20520, who will coordinate the review of the request to 
amend a record with the appropriate office(s). The Department will 
require verification of personal identity as provided Sec. 154.5(c)(3) 
of these regulations before it will initiate action to amend a record to 
ensure that the requester is not deliberately or inadvertently seeking 
to change records about other persons. Such requests should contain, as 
a minimum, identifying information needed to locate the record, a brief 
description of the items of information to be amended, and the nature of 
the requested amendment. The requester should submit as much 
documentation, arguments or other data as seems warranted to support 
her/his request for amendment.
    (c) All requests for amendments to records will be acknowledged 
within 10 days (excluding Saturdays, Sundays, and legal public 
holidays). Whenever possible all requests for amendments to records will 
be reviewed within 10 days (exluding Saturdays, Sundays, and legal 
public holidays) of their receipt by the Office responsible for the 
record, and the requester will be advised of the results of the review. 
In those cases where the review cannot be completed within 10 days, the 
requester will be so advised and informed when the review will be 
completed. Except in unusual circumstances, this review will be 
completed no later than 30 days (excluding Saturdays, Sundays, and legal 
public holidays) after receipt of the request to amend a record.

[[Page 574]]

    (d) In reviewing a record in response to a request to amend, the 
Department shall determine whether the record is relevant and necessary 
to accomplish a purpose of the agency and shall incorporate the criteria 
of accuracy, relevance, timeliness, and completeness of the record in 
that review.
    (e) If the office responsible for the record agrees with an 
individual's request to amend a record, it shall:
    (1) Advise the individual in writing;
    (2) Amend the record accordingly; and
    (3) If an accounting of disclosure has been made, advise all 
previous recipients of the record of the amendment and its substance.
    (f) If the office responsible for the record, after an initial 
review of a request to amend a record disagrees with all or any portion 
of the requested amendment, an officer at the Deputy Assistant Secretary 
level or equivalent, shall:
    (1) Advise the individual of its refusal and the reasons for it; and
    (2) Inform the individual that she or he may request a further 
review in accordance with subpart G.



               Subpart E--Ethics in Government Provisions



Sec. 171.40  Covered employees.

    (a) Officers and employees, including special government employees, 
whose positions are classified at grades GS-16 and above or at any 
equivalent rate under another pay schedule;
    (b) Officers or employees in a position determined by the Director 
of the Office of Government Ethics to be of equal classification to GS-
16;
    (c) Employees in the excepted service in positions which are of a 
confidential or policy-making nature unless an employee or groups of 
employees are exempted by the Director of the Office of Government 
Ethics;
    (d) The designated agency official who acts as the Department's 
Ethics Officer; and
    (e) Individuals who are nominated for positions requiring Senate 
confirmation by the President but who are not subsequently confirmed by 
the Senate.



Sec. 171.41  Identifying information.

    (a) The name and/or position title of the Department of State 
official who is subject of the request,
    (b) The time period covered by the report requested, and
    (c) Completion of an Ethics Request Form.



Sec. 171.42  Time limits.

    (a) Reports shall be made available to the public within fifteen 
(15) days after receipt by the Department.
    (b) Reports shall be retained by the Department and made available 
to the public for a period of six (6) years. The exceptions are those 
reports which are filed by individuals who are nominated for office by 
the President and are not confirmed by the Senate; those reports will be 
retained and made available for a one-year period.



Sec. 171.43  Access to, and use of, reports.

    The Attorney General is authorized to bring a civil action against 
any person who obtains or uses a financial disclosure report:
    (a) For any unlawful purpose;
    (b) For any commercial purpose, other than for news or community 
dissemination to the general public;
    (c) For determining or establishing the credit rating of any 
individual; or
    (d) For use, directly or indirectly, in the solicitation of money 
for any political, charitable, or other purpose.

The court may assess a civil penalty not to exceed $5,000 against any 
person who obtains or uses the reports for these prohibited purposes; an 
additional remedy as available under statutory or common law may also be 
assessed at the discretion of the court.



                      Subpart F--Denial Procedures



Sec. 171.50  Denials of access or of amendment.

    The decision to deny an individual access to records, or to deny an 
amendment request under Privacy Act provisions shall be made by: (a) The 
Department official of a rank not below the Deputy Assistant Secretary 
or equivalent level who is responsible for the

[[Page 575]]

system of records involved, (b) the Deputy Assistant Secretary for the 
Classification/Declassification Center, or her/his designees, (c) the 
Director/Deputy Director of Mandatory Review and the Director of 
Systematic Review in A/CDC, and (d) officials designated by the Under 
Secretary for Management/Chairman of the Oversight Committee for E.O. 
12065. When an authorized official denies access to a record or portion 
thereof, the official will advise the individual in writing of the 
denial and the specific reasons therefor. The denial letter will also 
advise the individual of her/his right to seek administrative review of 
the Department's decision.



                      Subpart G--Appeals Procedures



Sec. 171.60  Appeal of denial of access to records.

    (a) Review of an initial denial of access to a record under the 
Freedom of Information Act (5 U.S.C. 552), the Privacy Act of 1974 (5 
U.S.C. 552a), or Executive Order 12065 may be requested by the 
individual who submitted the initial request for access. The request for 
review (hereinafter referred to as the appeal) must be in writing and 
should be sent by certified mail to the Assistant Secretary for Public 
Affairs, Chairperson, Appeals Review Panels, Department of State, 2201 C 
street, NW., Washington, DC 20520. The appeal should be received within 
60 days of the date of receipt by the appellant of the Department's 
refusal to grant access to a record in whole or in part.
    (b) The time for decision on the appeal begins on the date the 
appeal is received by the Chairperson, Appeals Review Panels. The appeal 
of a denial of access to records shall include any documentation, 
information and statements to support the individual's request for 
access and to refute the use of the exemption(s) cited in the 
Department's justification concerning the denial of access.
    (c) The Chairperson of the Appeals Panels or her/his designee and at 
least two other members chosen by her/him from a list of senior officers 
designated for this purpose by the various bureaus of the Department 
shall constitute a panel to consider and decide the appeal. There shall 
be a written record of the reasons for the final determination. The 
final determination will be made within 30 working days for executive 
order and Privacy Act appeals, and within 20 working days (excluding 
Saturdays, Sundays, and holidays) for FOIA appeals. For good cause 
shown, the Chairperson of the Appeals Review Panels may extend such 
determination beyond the 30-day period in Privacy Act cases.
    (d) The Chairperson shall then notify the requester in writing of 
the panel's decision to grant access and of the Department's regulations 
concerning access.
    (e) When the final decision of the Panel is to refuse to grant an 
individual access to a record, the Chairperson of the Panel shall advise 
the individual in writing:
    (1) Of the refusal to grant the appeal and the reasons therefor 
including the exemptions of the Freedom of Information Act, the Privacy 
Act of 1974, and/or Executive Order 12065 under which access is denied;
    (2) Of her/his right to seek judicial review of the Department's 
decision, where applicable.
[45 FR 58108, Sept. 2, 1980, as amended at 49 FR 16990, Apr. 23, 1984]



Sec. 171.61  Appeal of refusal to amend records.

    (a) Review of an initial refusal to amend a record under the Privacy 
Act of 1974 may be requested by the individual who submitted the initial 
request for amendment. The review (hereinafter referred to as the 
appeal) should be requested in writing within 60 days of the date the 
individual is informed of the Department's refusal to amend a record in 
whole or in part. The appeal must be in writing and should be sent by 
certified mail to the Assistant Secretary for Public Affairs, 
Chairperson, Appeals Review Panels, Department of State, 2201 C Street, 
NW. Washington, DC 20520.
    (b) The time for decision on the appeal begins on the date the 
appeal is received by the Chairperson, Appeals Review Panels. The appeal 
should include any documentation, information or statements advanced for 
the amendment of the record.

[[Page 576]]

    (c) The Chairperson of the Appeals Review Panels and two other 
members of the Panels designated by him shall constitute a panel to 
consider and decide the appeal; there shall be a written record of the 
reasons for the final determination. The final determination will be 
made within 30 days (excluding Saturdays, Sundays , and legal public 
holidays), unless for good cause shown, the Chairperson of the Appeals 
Review Panels extends such determination beyond the 30-day period.
    (d) When the final determination is that the record should be 
amended in accordance with the individual's request, the Chairperson of 
the Appeals Review Panels shall direct the office responsible for the 
record to comply. A responsible official of the Department shall then:
    (1) Amend the records as directed;
    (2) If any accounting of the disclosure has been made, advise all 
previous recipients of the record of the amendment and its substance;
    (3) So advise the individual in writing.
    (e) When the final decision is that the request of the individual to 
amend the record is refused, the Chairperson of the Panels shall advise 
the individual:
    (1) Of the refusal and the reasons for it;
    (2) Of her and his right to file a concise statement of the reasons 
for disagreeing with the decision of the Department;
    (3) Of the procedures for filing the statement of disagreement;
    (4) That the statement which is filed will be made available to 
anyone to whom the record is subsequently disclosed together with, at 
the discretion of the Department, a brief statement by the Department 
summarizing its reasons for refusing to amend the record;
    (5) That prior recipients of the disputed record will be provided a 
copy of any statement of dispute to the extent that an accounting of 
disclosures was maintained; and
    (6) Of her/his right to seek judicial review of the Department's 
refusal to amend the record.
    (f) When the final determination is to refuse to amend a record and 
the individual has filed a statement under paragraph (e) of this 
section, the Department will clearly annotate the record so that the 
fact that the record is disputed is apparent to anyone who may 
subsequently have access to, use, or disclose it. When information that 
is the subject of a statement of dispute filed by an individual is 
subsequently disclosed, the Department will note that the information is 
disputed and provide a copy of the individual's statement. The 
Department may also include a brief summary of the reasons for not 
making a correction when disclosing disputed information. Such 
statements will normally be limited to the reasons given to the 
individual for not amending the record. Copies of the Department's 
statement shall be treated as part of the individual's record for 
granting access; however, it will not be subject to amendment by the 
individual under these regulations.
[45 FR 58108, Sept. 2, 1980, as amended at 49 FR 16990, Apr. 23, 1984]



                    Subpart H--Other Agency Material



Sec. 171.70  Referral.

    While processing a request for access, the Department may locate in 
its files documents originated by other Federal agencies. The Department 
shall refer the documents to the originating agency for review and 
possible declassification and release to the requester. The originating 
agency is then responsible for contacting the requester directly 
concerning the release of the material and for notifying the Department 
of its determination. The Department of State will notify the requester 
of the referral unless the association of the reviewing agency with the 
information requires protection in the interest of national security.



Sec. 171.71  Concurrence.

    While processing a request for access, the Department may locate 
Department of State documents containing information originated by or of 
substantive interest to other Federal agencies. The Department shall 
refer these documents or portions thereof to the originating or 
interested agency for review, possible declassification

[[Page 577]]

and concurrence regarding the documents' release. The other agency will 
then return the documents to the Department so that it may contact the 
requester regarding the material.



  PART 172--SERVICE OF PROCESS; PRODUCTION OR DISCLOSURE OF OFFICIAL INFORMATION IN RESPONSE TO COURT ORDERS, SUBPOENAS, NOTICES OF DEPOSITIONS, REQUESTS FOR 

ADMISSIONS, INTERROGATORIES, OR SIMILAR REQUESTS OR DEMANDS IN CONNECTION WITH FEDERAL OR STATE LITIGATION; EXPERT TESTIMONY--Table of Contents




Sec.
172.1  Purpose and scope; definitions.
172.2  Service of summonses and complaints.
172.3  Service of subpoenas, court orders, and other demands or requests 
          for official information or action.
172.4  Testimony and production of documents prohibited unless approved 
          by appropriate Department officials.
172.5  Procedure when testimony or production of documents is sought; 
          general.
172.6  Procedure when response to demand is required prior to receiving 
          instructions.
172.7  Procedure in the event of an adverse ruling.
172.8  Considerations in determining whether the Department will comply 
          with a demand or request.
172.9  Prohibition on providing expert or opinion testimony.

    Authority:  5 U.S.C. 301; 8 U.S.C. 1202(f); 22 U.S.C. 2658, 2664, 
3926.

    Source:  57 FR 32896, July 24, 1992, unless otherwise noted.



Sec. 172.1  Purpose and scope; definitions.

    (a) This part sets forth the procedures to be followed with respect 
to:
    (1) Service of summonses and complaints or other requests or demands 
directed to the Department of State (Department) or to any Department 
employee or former employee in connection with federal or state 
litigation arising out of or involving the performance of official 
activities of the Department; and
    (2) The oral or written disclosure, in response to subpoenas, 
orders, or other requests or demands of federal or state judicial or 
quasi-judicial authority (collectively, ``demands''), whether civil or 
criminal in nature, or in response to requests for depositions, 
affidavits, admissions, responses to interrogatories, document 
production, or other litigation-related matters, pursuant to the Federal 
Rules of Civil Procedure, the Federal Rules of Criminal Procedure, or 
applicable state rules (collectively, ``requests''), of any material 
contained in the files of the Department, any information relating to 
material contained in the files of the Department, or any information 
acquired while the subject of the demand or request is or was an 
employee of the Department as part of the performance of that person's 
duties or by virtue of that person's official status.
    (b) For purposes of this part, and except as the Department may 
otherwise determine in a particular case, the term employee includes the 
Secretary and former Secretaries of State, and all employees and former 
employees of the Department of State or other federal agencies who are 
or were appointed by, or subject to the supervision, jurisdiction, or 
control of the Secretary of State or his Chiefs of Mission, whether 
residing or working in the United States or abroad, including United 
States nationals, foreign nationals, and contractors.
    (c) For purposes of this part, the term litigation encompasses all 
pre-trial, trial, and post-trial stages of all judicial or 
administrative actions, hearings, investigations, or similar proceedings 
before courts, commissions, boards (including the Board of Appellate 
Review), or other judicial or quasi-judicial bodies or tribunals, 
whether criminal, civil, or administrative in nature. This part governs, 
inter alia, responses to discovery requests, depositions, and other pre-
trial, trial, or post-trial proceedings, as well as responses to 
informal requests by attorneys or others in situations involving 
litigation. However, this part shall not apply to any claims by 
Department of State employees (present or former), or applicants for 
Department employment, for which jurisdiction resides with the U.S. 
Equal Employment Opportunity Commission; the U.S. Merit Systems 
Protection Board; the Office of Special Counsel; the Federal Labor

[[Page 578]]

Relations Authority; the Foreign Service Labor Relations Board; the 
Foreign Service Grievance Board; or a labor arbitrator operating under a 
collective bargaining agreement between the Department and a labor 
organization representing Department employees; or their successor 
agencies or entities.
    (d) For purposes of this part, official information means all 
information of any kind, however stored, that is in the custody and 
control of the Department, relates to information in the custody and 
control of the Department, or was acquired by Department employees as 
part of their official duties or because of their official status within 
the Department while such individuals were employed by or served on 
behalf of the Department.
    (e) Nothing in this part affects disclosure of information under the 
Freedom of Information Act (FOIA), 5 U.S.C. 552, the Privacy Act, 5 
U.S.C. 552a, Executive Order 12356 on national security information (3 
CFR, 1982 Comp., p. 166), the Government in the Sunshine Act, 5 U.S.C. 
552b, the Department's implementing regulations in 22 CFR part 171 or 
pursuant to congressional subpoena. Nothing in this part otherwise 
permits disclosure of information by the Department or its employees 
except as provided by statute or other applicable law.
    (f) This part is intended only to inform the public about Department 
procedures concerning the service of process and responses to demands or 
requests and is not intended to and does not create, and may not be 
relied upon to create any right or benefit, substantive or procedural, 
enforceable at law by a party against the Department or the United 
States.
    (g) Nothing in this part affects:
    (1) The disclosure of information during the course of legal 
proceedings in non-United States courts, commissions, boards, or other 
judicial or quasi-judicial bodies or tribunals; or
    (2) The rules and procedures, under applicable U.S. law and 
international conventions, governing diplomatic and consular immunity.
    (h) Nothing in this part affects the disclosure of official 
information to other federal agencies or Department of Justice attorneys 
in connection with litigation conducted on behalf or in defense of the 
United States, its agencies, officers, and employees, or to federal, 
state, local, or foreign prosecuting and law enforcement authorities in 
conjunction with criminal law enforcement investigations, prosecutions, 
or other proceedings, e.g., extradition, deportation.



Sec. 172.2  Service of summonses and complaints.

    (a) Only the Executive Office of the Office of the Legal Adviser (L/
EX) is authorized to receive and accept summonses or complaints sought 
to be served upon the Department or Department employees. All such 
documents should be delivered or addressed to The Executive Office, 
Office of the Legal Adviser, room 5519, United States Department of 
State, 2201 C Street, NW., Washington, DC 20520-6310.
    (b) In the event any summons or complaint described in Sec. 172.1(a) 
is delivered to an employee of the Department other than in the manner 
specified in this part, such attempted service shall be ineffective, and 
the recipient thereof shall either decline to accept the proffered 
service or return such document under cover of a written communication 
which directs the person attempting to make service to the procedures 
set forth herein.
    (c) Except as otherwise provided Secs. 172.2(d) and 173.3(c), the 
Department is not an authorized agent for service of process with 
respect to civil litigation against Department employees purely in their 
personal, non-official capacity. Copies of summonses or complaints 
directed to Department employees in connection with legal proceedings 
arising out of the performance of official duties may, however, be 
served upon L/EX.
    (d) Although the Department is not an agent for the service of 
process upon its employees with respect to purely personal, non-official 
litigation, the Department recognizes that its employees stationed 
overseas should not use their official positions to evade their personal 
obligations and will, therefore, counsel and encourage Department 
employees to accept service of process in appropriate cases, and will 
waive applicable diplomatic or

[[Page 579]]

consular privileges and immunities when the Department determines that 
it is in the interest of the United States to do so.
    (e) Documents for which L/EX accepts service in official capacity 
only shall be stamped ``Service Accepted in Official Capacity Only''. 
Acceptance of service shall not constitute an admission or waiver with 
respect to jurisdiction, propriety of service, improper venue, or any 
other defense in law or equity available under the laws of rules 
applicable for the service of process.



Sec. 172.3  Service of subpoenas, court orders, and other demands or requests for official information or action.

    (a) Except in cases in which the Department is represented by legal 
counsel who have entered an appearance or otherwise given  notice  of  
their  representation,  only L/EX is authorized to receive and accept 
subpoenas, or other demands or requests directed to the Department, or 
any component thereof, or its employees, or former employees, whether 
civil or criminal nature, for:
    (1) Material, including documents, contained in the files of the 
Department;
    (2) Information, including testimony, affidavits, declarations, 
admissions, responses to interrogatories, or informal statements, 
relating to material contained in the files of the Department or which 
any Department employee acquired in the course and scope of the 
performance of his official duties;
    (3) Garnishment or attachment of compensation of current or former 
employees; or
    (4) The performance or non-performance of any official Department 
duty.
    (b) In the event that any subpoena, demand, or request is sought to 
be delivered to a Department employee (including former employees) other 
than in the manner prescribed in paragraph (a) of this section, such 
attempted service shall be ineffective. Such employee shall, after 
consultation with the Office of the Legal Adviser, decline to accept the 
subpoena, demand or request or shall return them to the server under 
cover of a written communication referring to the procedures prescribed 
in this part.
    (c) Except as otherwise provided in this part, the Department is not 
an agent for service, or otherwise authorized to accept on behalf of its 
employees any subpoenas, show-cause orders, or similar compulsory 
process of federal or state courts, or requests from private individuals 
or attorneys, which are not related to the employees' official duties 
except upon the express, written authorization of the individual 
Department employee to whom such demand or request is directed.
    (d) Acceptance of such documents by L/EX does not constitute a 
waiver of any defenses that might otherwise exist with respect to 
service under the Federal Rules of Civil or Criminal Procedure or other 
applicable rules.



Sec. 172.4  Testimony and production of documents prohibited unless approved by appropriate Department officials.

    (a) No employee of the Department shall, in response to a demand or 
request in connection with any litigation, whether criminal or civil, 
provide oral or written testimony by deposition, declaration, affidavit, 
or otherwise concerning any information acquired while such person is or 
was an employee of the Department as part of the performance of that 
person's official duties or by virtue of that persons's official status, 
unless authorized to do so by the Director General of the Foreign 
Service and Director of Personnel (M/DGP) or the Legal Adviser (L), or 
delegates of either, following consultation between the two bureaus, or 
as authorized in Sec. 172.4(b).
    (b) With respect to the official functions of the Passport Office, 
the Visa Office, and the Office of Citizens Services, the Assistant 
Secretary of State for Consular Affairs or delegate thereof may, subject 
to concurrence by the Office of the Legal Adviser, authorize employees 
to provide oral or written testimony.
    (c) No employee shall, in response to a demand or request in 
connection with any litigation, produce for use at such proceedings any 
document or any material acquired as part of the performance of that 
employee's duties or by

[[Page 580]]

virtue of that employee's official status, unless authorized to do so by 
the Director General of the Foreign Service and Director of Personnel, 
the Legal Adviser, or the Assistant Secretary of State for Consular 
Affairs, or the delegates thereof, as appropriate, following 
consultations between the concerned bureaus.



Sec. 172.5  Procedure when testimony or production of documents is sought; general.

    (a) If official Department information is sought, through testimony 
or otherwise, by a request or demand, the party seeking such release or 
testimony must (except as otherwise required by federal law or 
authorized by the Office of the Legal Adviser) set forth in writing, and 
with as much specificity as possible, the nature and relevance of the 
official information sought. Where documents or other materials are 
sought, the party should provide a description using the types of 
identifying information suggested in 22 CFR 171.10(a) and 171.31. 
Subject to Sec. 172.7, Department employees may only produce, disclose, 
release, comment upon, or testify concerning those matters which were 
specified in writing and properly approved by the appropriate Department 
official designated in Sec. 172.4. See United States ex rel. Touhy v. 
Ragen, 340 U.S. 462 (1951). The Office of the Legal Adviser may waive 
this requirement in appropriate circumstances.
    (b) To the extent it deems necessary or appropriate, the Department 
may also require from the party seeking such testimony or documents a 
plan of all reasonably foreseeable demands, including but not limited to 
the names of all employees and former employees from whom discovery will 
be sought, areas of inquiry, expected duration of proceedings requiring 
oral testimony, and identification of potentially relevant documents.
    (c) The appropriate Department official designated in Sec. 172.2 
will notify the Department employee and such other persons as 
circumstances may warrant of its decision regarding compliance with the 
request or demand.
    (d) The Office of the Legal Adviser will consult with the Department 
of Justice regarding legal representation for Department employees in 
appropriate cases.



Sec. 172.6  Procedure when response to demand is required prior to receiving instructions.

    (a) If a response to a demand is required before the appropriate 
Department official designated in Sec. 172.4 renders a decision, the 
Department will request that either a Department of Justice attorney or 
a Department attorney designated for the purpose:
    (1) Appear with the employee upon whom the demand has been made;
    (2) Furnish the court or other authority with a copy of the 
regulations contained in this part;
    (3) Inform the court or other authority that the demand has been, or 
is being, as the case may be, referred for the prompt consideration of 
the appropriate Department official; and
    (4) Respectively request the court or authority to stay the demand 
pending receipt of the requested instructions.
    (b) In the event that an immediate demand for production or 
disclosure is made in circumstances which would preclude the proper 
designation or appearance of a Department of Justice or Department 
attorney on the employee's behalf, the employee shall respectfully 
request the demanding court or authority for a reasonable stay of 
proceedings for the purpose of obtaining instructions from the 
Department.



Sec. 172.7  Procedure in the event of an adverse ruling.

    If the court or other judicial or quasi-judicial authority declines 
to stay the effect of the demand in response to a request made pursuant 
to Sec. 172.6, or if the court or other authority rules that the demand 
must be complied with irrespective of the Department's instructions not 
to produce the material or disclose the information sought, the employee 
upon whom the demand has been made shall respectfully decline to comply 
with the demand, citing this part and United States ex rel. Touhy v. 
Ragen, 340 U.S. 462 (1951).

[[Page 581]]



Sec. 172.8  Considerations in determining whether the Department will comply with a demand or request.

    (a) In deciding whether to comply with a demand or request, 
Department officials and attorneys shall consider, among others:
    (1) Whether such compliance would be unduly burdensome or otherwise 
inappropriate under the applicable rules of discovery or the rules of 
procedure governing the case or matter in which the demand arose;
    (2) Whether compliance is appropriate under the relevant substantive 
law concerning privilege or disclosure of information;
    (3) The public interest;
    (4) The need to conserve the time of Department employees for the 
conduct of official business;
    (5) The need to avoid spending the time and money of the United 
States for private purposes;
    (6) The need to maintain impartiality between private litigants in 
cases where a substantial government interest is not implicated;
    (7) Whether compliance would have an adverse effect on performance 
by the Department of its mission and duties; and
    (8) The need to avoid involving the Department in controversial 
issues not related to its mission.
    (b) Among those demands and requests in response to which compliance 
will not ordinarily be authorized are those with respect to which, inter 
alia, any of the following factors exist:
    (1) Compliance would violate a statute or a rule of procedure;
    (2) Compliance would violate a specific regulation or executive 
order;
    (3) Compliance would reveal information properly classified in the 
interest of national security;
    (4) Compliance would reveal confidential commercial or financial 
information or trade secrets without the owner's consent;
    (5) Compliance would reveal the internal deliberative processes of 
the Executive Branch; or
    (6) Compliance would potentially impede or prejudice an on-going law 
enforcement investigation.



Sec. 172.9  Prohibition on providing expert or opinion testimony.

    (a) Except as provided in this section, and subject to 5 CFR 
2635.805, Department employees shall not provide opinion or expert 
testimony based upon information which they acquired in the scope and 
performance of their official Department duties, except on behalf of the 
United States or a party represented by the Department of Justice.
    (b) Upon a showing by the requestor of exceptional need or unique 
circumstances and that the anticipated testimony will not be adverse to 
the interests of the United States, the appropriate Department official 
designated in Sec. 172.4 may, consistent with 5 CFR 2635.805, in their 
discretion and with the concurrence of the Office of the Legal Adviser, 
grant special, written authorization for Department employees to appear 
and testify as expert witnesses at no expense to the United States.
    (c) If, despite the final determination of the appropriate 
Department official designated in Sec. 172.4, a court of competent 
jurisdiction or other appropriate authority orders the appearance and 
expert or opinion testimony of a Department employee, such employee 
shall immediately inform the Office of the Legal Adviser of such order. 
If the Office of the Legal Adviser determines that no further legal 
review of or challenge to the court's order will be made, the Department 
employee shall comply with the order. If so directed by the Office of 
the Legal Adviser, however, the employee shall respectfully decline to 
testify. See United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951).

[[Page 582]]



                 SUBCHAPTER S--INTERNATIONAL AGREEMENTS





PART 181--COORDINATION, REPORTING AND PUBLICATION OF INTERNATIONAL AGREEMENTS--Table of Contents




Sec.
181.1  Purpose and application.
181.2  Criteria.
181.3  Determinations.
181.4  Consultations with the Secretary of State.
181.5  Twenty-day rule for concluded agreements.
181.6  Documentation and certification.
181.7  Transmittal to the Congress.
181.8  Publication.

    Authority:  1 U.S.C. 112a, 112b; and 22 U.S.C. 2651a.

    Source:  46 FR 35918, July 13, 1981, unless otherwise noted.



Sec. 181.1  Purpose and application.

    (a) The purpose of this part is to implement the provisions of 1 
U.S.C. 112a and 112b, popularly known as the Case-Zablocki Act 
(hereinafter ``the Act''), on the reporting to Congress, coordination 
with the Secretary of State and publication of international agreements. 
This part applies to all agencies of the U.S. Government whose 
responsibilities include the negotiation and conclusion of international 
agreements. This part does not, however, constitute a delegation by the 
Secretary of State of the authority to engage in such activites. 
Further, it does not affect any additional requirements of law governing 
the relationship between particular agencies and the Secretary of State 
in connection with international negotiations and agreements, or any 
other requirements of law concerning the relationship between particular 
agencies and the Congress. The term agency as used in this part means 
each authority of the United States Government, whether or not it is 
within or subject to review by another agency.
    (b) Pursuant to the key legal requirements of the Act--full and 
timely disclosure to the Congress of all concluded agreements and 
consultation by agencies with the Secretary of State with respect to 
proposed agreements--every agency of the Government is required to 
comply with each of the provisions set out in this part in 
implementation of the Act. Nevertheless, this part is intended as a 
framework of measures and procedures which, it is recognized, cannot 
anticipate all circumstances or situations that may arise. Deviation or 
derogation from the provisions of this part will not affect the legal 
validity, under United States law or under international law, of 
agreements concluded, will not give rise to a cause of action, and will 
not affect any public or private rights established by such agreements.
[46 FR 35918, July 13, 1981, as amended at 61 FR 7071, Feb. 26, 1996]



Sec. 181.2  Criteria.

    (a) General. The following criteria are to be applied in deciding 
whether any undertaking, oral agreement, document, or set of documents, 
including an exchange of notes or of correspondence, constitutes an 
international agreement within the meaning of the Act, as well as within 
the meaning of 1 U.S.C. 112a, requiring the publication of international 
agreements. Each of the criteria except those in paragraph (a)(5) of 
this section must be met in order for any given undertaking of the 
United States to constitute an international agreement.
    (1) Identity and intention of the parties. A party to an 
international agreement must be a state, a state agency, or an 
intergovernmental organization. The parties must intend their 
undertaking to be legally binding, and not merely of political or 
personal effect. Documents intended to have political or moral weight, 
but not intended to be legally binding, are not international 
agreements. An example of the latter is the Final Act of the Helsinki 
Conference on Cooperation and Security in Europe. In addition, the 
parties must intend their undertaking to be governed by international 
law, although this intent need not be manifested by a third-party 
dispute settlement mechanism or any express reference to international 
law. In the absence of any provision in

[[Page 583]]

the arrangement with respect to governing law, it will be presumed to be 
governed by international law. This presumption may be overcome by clear 
evidence, in the negotiating history of the agreement or otherwise, that 
the parties intended the arrangement to be governed by another legal 
system. Arrangements governed solely by the law of the United States, or 
one of the states or jurisdictions thereof, or by the law of any foreign 
state, are not international agreements for these purposes. For example, 
a foreign military sales loan agreement governed in its entirety by U.S. 
law is not an international agreement.
    (2) Significance of the arrangement. Minor or trivial undertakings, 
even if couched in legal language and form, are not considered 
international agreements within the meaning of the Act or of 1 U.S.C. 
112a. In deciding what level of significance must be reached before a 
particular arrangement becomes an international agreement, the entire 
context of the transaction and the expectations and intent of the 
parties must be taken into account. It is often a matter of degree. For 
example, a promise to sell one map to a foreign nation is not an 
international agreement; a promise to exchange all maps of a particular 
region to be produced over a period of years may be an international 
agreement. It remains a matter of judgment based on all of the 
circumstances of the transaction. Determinations are made pursuant to 
Sec. 181.3. Examples of arrangements that may constitute international 
agreements are agreements that: (i) Are of political significance; (ii) 
involve substantial grants of funds or loans by the United States or 
credits payable to the United States; (iii) constitute a substantial 
commitment of funds that extends beyond a fiscal year or would be a 
basis for requesting new appropriations; (iv) involve continuing and/or 
substantial cooperation in the conduct of a particular program or 
activity, such as scientific, technical, or other cooperation, including 
the exchange or receipt of information and its treatment, or the pooling 
of data. However, individual research grants and contracts do not 
ordinarily constitute international agreements.
    (3) Specificity, including objective criteria for determining 
enforceability. International agreements require precision and 
specificity in the language setting forth the undertakings of the 
parties. Undertakings couched in vague or very general terms containing 
no objective criteria for determining enforceability or performance are 
not normally international agreements. Most frequently such terms 
reflect an intent not to be bound. For example, a promise to ``help 
develop a more viable world economic system'' lacks the specificity 
essential to constitute a legally binding international agreement. 
However, the intent of the parties is the key factor. Undertakings as 
general as those of, for example, Articles 55 and 56 of the United 
Nations Charter have been held to create internationally binding 
obligations intended as such by the parties.
    (4) Necessity for two or more parties. While unilateral commitments 
on occasion may be legally binding, they do not constitute international 
agreements. For example, a statement by the President promising to send 
money to Country Y to assist earthquake victims would not be an 
international agreement. It might be an important undertaking, but not 
all undertakings in international relations are in the form of 
international agreements. Care should be taken to examine whether a 
particular undertaking is truly unilateral in nature, or is part of a 
larger bilateral or multilateral set of undertakings. Moreover, 
``consideration,'' as that term is used in domestic contract law, is not 
required for international agreements.
    (5) Form. Form as such is not normally an important factor, but it 
does deserve consideration. Documents which do not follow the customary 
form for international agreements, as to matters such as style, final 
clauses, signatures, or entry into force dates, may or may not be 
international agreements. Failure to use the customary form may 
constitute evidence of a lack of intent to be legally bound by the 
arrangement. If, however, the general content and context reveal an 
intention to enter into a legally binding relationship, a departure from 
customary form will not preclude the arrangement

[[Page 584]]

from being an international agreement. Moreover, the title of the 
agreement will not be determinative. Decisions will be made on the basis 
of the substance of the arrangement, rather than on its denomination as 
an international agreement, a memorandum of understanding, exchange of 
notes, exchange of letters, technical arrangement, protocol, note 
verbale, aide-memoire, agreed minute, or any other name.
    (b) Agency-Level agreements. Agency-level agreements are 
international agreements within the meaning of the Act and of 1 U.S.C. 
112a if they satisfy the criteria discussed in paragraph (a) of this 
section. The fact that an agreement is concluded by and on behalf of a 
particular agency of the United States Government, rather than the 
United States Government, does not mean that the agreement is not an 
international agreement. Determinations are made on the basis of the 
substance of the agency-level agreement in question.
    (c) Implementing agreements. An implementing agreement, if it 
satisfies the criteria discussed in paragraph (a) of this section, may 
be an international agreement, depending upon how precisely it is 
anticipated and identified in the underlying agreement it is designed to 
implement. If the terms of the implementing agreement are closely 
anticipated and identified in the underlying agreement, only the 
underlying agreement is considered and international agreement. For 
example, the underlying agreement might call for the sale by the United 
States of 1000 tractors, and a subsequent implementing agreement might 
require a first installment on this obligation by the sale of 100 
tractors of the brand X variety. In that case, the implementing 
agreement is sufficiently identified in the underlying agreement, and 
would not itself be considered an international agreement within the 
meaning of the Act or of 1 U.S.C. 112a. Project annexes and other 
documents which provide technical content for an umbrella agreement are 
not normally treated as international agreements. However, if the 
underlying agreement is general in nature, and the implementing 
agreement meets the specified criteria of paragraph (a) of this section, 
the implementing agreement might well be an international agreement. For 
example, if the underlying agreement calls for the conclusion of 
``agreements for agricultural assistance,'' but without further 
specificity, then a particular agricultural assistance agreement 
subsequently concluded in ``implementation'' of that obligation, 
provided it meets the criteria discussed in paragraph (a) of this 
section, would constitute an international agreement independent of the 
underlying agreement.
    (d) Extensions and modifications of agreements. If an undertaking 
constitutes an international agreement within the meaning of the Act and 
of 1 U.S.C. 112a, then a subsequent extension or modification of such an 
agreement would itself constitute an international agreement within the 
meaning of the Act and of 1 U.S.C. 112a.
    (e) Oral agreements. Any oral arrangement that meets the criteria 
discussed in paragraphs (a)(1)-(4) of this section is an international 
agreement and, pursuant to section (a) of the Act, must be reduced to 
writing by the agency that concluded the oral arrangement. In such 
written form, the arrangement is subject to all the requirements of the 
Act and of this part. Whenever a question arises whether an oral 
arrangement constitutes an international agreement, the arrangement 
shall be reduced to writing and the decision made in accordance with 
Sec. 181.3.



Sec. 181.3  Determinations.

    (a) Whether any undertaking, document, or set of documents 
constitutes or would constitute an international agreement within the 
meaning of the Act or of 1 U.S.C. 112a shall be determined by the Legal 
Adviser of the Department of State, a Deputy Legal Adviser, or in most 
cases the Assistant Legal Adviser for Treaty Affairs. Such 
determinations shall be made either on a case-by-case basis, or on 
periodic consultation, as appropriate.
    (b) Agencies whose responsibilities include the negotiation and 
conclusion

[[Page 585]]

of international agreements are responsible for transmitting to the 
Assistant Legal Adviser for Treaty Affairs, for decision pursuant to 
paragraph (a) of this section, the texts of any document or set of 
documents that might constitute an international agreement. The 
transmittal shall be made prior to or simultaneously with the request 
for consultations with the Secretary of State required by subsection (c) 
of the Act and Sec. 181.4 of this part.
    (c) Agencies whose responsibilities include the negotiation and 
conclusion of large numbers of agency-level and implementing 
arrangements at overseas posts, only a small number of which might 
constitute international agreements within the meaning of the Act and of 
1 U.S.C. 112a, are required to transmit prior to their entry into force 
only the texts of the more important of such arrangements for decision 
pursuant to paragraph (a) of this section. The texts of all arrangements 
that might constitute international agreements shall, however, be 
transmitted to the Office of the Assistant Legal Adviser for Treaty 
Affairs as soon as possible, and in no event to arrive at that office 
later than 20 days after their signing, for decision pursuant to 
paragraph (a) of this section.
    (d) Agencies to which paragraphs (b) and (c) of this section apply 
shall consult periodically with the Assistant Legal Adviser for Treaty 
Affairs in order to determine which categories of arrangements for which 
they are responsible are likely to be international agreements within 
the meaning of the Act and of 1 U.S.C. 112a.



Sec. 181.4  Consultations with the Secretary of State.

    (a) The Secretary of State is responsible, on behalf of the 
President, for ensuring that all proposed international agreements of 
the United States are fully consistent with United States foreign policy 
objectives. Except as provided in Sec. 181.3(c) of this part, no agency 
of the U.S. Government may conclude an international agreement, whether 
entered into in the name of the U.S. Government or in the name of the 
agency, without prior consultation with the Secretary of State or his 
designee.
    (b) The Secretary of State (or his designee) gives his approval for 
any proposed agreement negotiated pursuant to his authorization, and his 
opinion on any proposed agreement negotiated by an agency which has 
separate authority to negotiate such agreement. The approval or opinion 
of the Secretary of State or his designee with respect to any proposed 
international agreement will be given pursuant to Department of State 
procedures set out in Volume 11, Foreign Affairs Manual, Chapter 700 
(Circular 175 procedure). Officers of the Department of State shall be 
responsible for the preparation of all documents required by the 
Circular 175 procedure.
    (c) Pursuant to the Circular 175 procedure, the approval of, or an 
opinion on a proposed international agreement to be concluded in the 
name of the U.S. Government will be given either by the Secretary of 
State or his designee. The approval of, or opinion on a proposed 
international agreement to be concluded in the name of a particular 
agency of the U.S. Government will be given by the interested assistant 
secretary or secretaries of State, or their designees, unless such 
official(s) judge that consultation with the Secretary, Deputy 
Secretary, or an Under Secretary is necessary. The approval of, or 
opinion on a proposed international agreement will normally be given 
within 20 days of receipt of the request for consultation and of the 
information as required by Sec. 181.4(d)-(g).
    (d) Any agency wishing to conclude an international agreement shall 
transmit to the interested bureau or office in the Department of State, 
or to the Office of the Legal Adviser, for consultation pursuant to this 
section, a draft text or summary of the proposed agreement, a precise 
citation of the Constitutional, statutory, or treaty authority for such 
agreement, and other background information as requested by the 
Department of State. The transmittal of the draft text or summary and 
citation of legal authority shall be made before negotiations are 
undertaken, or if that is not feasible, as early as possible in the 
negotiating process. In any event such transmittals

[[Page 586]]

must be made no later than 50 days prior to the anticipated date for 
concluding the proposed agreement. If unusual circumstances prevent this 
50-day requirement from being met, the concerned agency shall use its 
best efforts to effect such transmittal as early as possible prior to 
the anticipated date for concluding the proposed agreement.
    (e) If a proposed agreement embodies a commitment to furnish funds, 
goods, or services that are beyond or in addition to those authorized in 
an approved budget, the agency proposing the agreement shall state what 
arrangements have been planned or carried out concerning consultation 
with the Office of Management and Budget for such commitment. The 
Department of State should receive confirmation that the relevant budget 
approved by the President provides or requests funds adequate to fulfill 
the proposed commitment, or that the President has made a determination 
to seek the required funds.
    (f) Consultation may encompass a specific class of agreements rather 
than a particular agreement where a series of agreements of the same 
general type is contemplated; that is, where a number of agreements are 
to be negotiated according to a more or less standard formula, such as, 
for example, Pub. L. 480 Agricultural Commodities Agreements. Any agency 
wishing to conclude a particular agreement within a specific class of 
agreements about which consultations have previously been held pursuant 
to this section shall transmit a draft text of the proposed agreement to 
the Office of the Legal Adviser as early as possible but in no event 
later than 20 days prior to the anticipated date for concluding the 
agreement.
    (g) The consultation requirement shall be deemed to be satisfied 
with respect to proposed international agreements of the United States 
about which the Secretary of State (or his designee) has been consulted 
in his capacity as a member of an interagency committee or council 
established for the purpose of approving such proposed agreements. 
Designees of the Secretary of State serving on any such interagency 
committee or council are to provide as soon as possible to the 
interested offices or bureaus of the Department of State and to the 
Office of the Legal Adviser copies of draft texts or summaries of such 
proposed agreements and other background information as requested.
    (h) Before an agreement containing a foreign language text may be 
signed or otherwise concluded, a signed memorandum must be obtained from 
a responsible language officer of the Department of State or of the U.S. 
Government agency concerned certifying that the foreign language text 
and the English language test are in conformity with each other and that 
both texts have the same meaning in all substantive respects. The signed 
memorandum is to be made available to the Department of State upon 
request.



Sec. 181.5  Twenty-day rule for concluded agreements.

    (a) Any agency, including the Department of State, that concludes an 
international agreement within the meaning of the Act and of 1 U.S.C. 
112a, whether entered into in the name of the U.S. Government or in the 
name of the agency, must transmit the text of the concluded agreement to 
the Office of the Assistant Legal Adviser for Treaty Affairs as soon as 
possible and in no event to arrive at that office later than 20 days 
after the agreement has been signed. The 20-day limit, which is required 
by the Act, is essential for purposes of permitting the Department of 
State to meet its obligation under the Act to transmit concluded 
agreements to the Congress no later than 60 days after their entry into 
force.
    (b) In any case of transmittal after the 20-day limit, the agency or 
Department of State office concerned may be asked to provide to the 
Assistant Legal Adviser for Treaty Affairs a statement describing the 
reasons for the late transmittal. Any such statements will be used, as 
necessary, in the preparation of the annual report on late transmittals, 
to be signed by the President and transmitted to the Congress, as 
required by subsection (b) of the Act.

[[Page 587]]



Sec. 181.6  Documentation and certification.

    (a) Transmittals of concluded agreements to the Assistant Legal 
Adviser for Treaty Affairs pursuant to Sec. 181.5 must include the 
signed or initialed original texts, together with all accompanying 
papers, such as agreed minutes, exchanges of notes, or side letters. The 
texts transmitted must be accurate, legible, and complete, and must 
include the texts of all languages in which the agreement was signed or 
initiated. Names and identities of the individuals signing or initialing 
the agreements, for the foreign government as well as for the United 
States, must, unless clearly evident in the texts transmitted, be 
separately provided.
    (b) Agreements from overseas posts should be transmitted to the 
Department of State by priority airgram, marked for the attention of the 
Assistant Legal Adviser for Treaty Affairs, with the following notation 
below the enclosure line: FAIM: Please send attached original agreement 
to L/T on arrival.
    (c) Where the original texts of concluded agreements are not 
available, certified copies must be transmitted in the same manner as 
original texts. A certified copy must be an exact copy of the signed 
original.
    (d) When an exchange of diplomatic notes between the United States 
and a foreign government constitutes an agreement or has the effect of 
extending, modifying, or terminating an agreement to which the United 
States is a party, a properly certified copy of the note from the United 
States to the foreign government, and the signed original of the note 
from the foreign government, must be transmitted. If, in conjunction 
with the agreement signed, other notes related thereto are exchanged 
(either at the same time, beforehand, or subsequently), properly 
certified copies of the notes from the United States to the foreign 
government must be transmitted with the signed originals of the notes 
from the foreign government.
    (e) Copies may be certified either by a certification on the 
document itself, or by a separate certification attached to the 
document. A certification on the document itself is placed at the end of 
the document. It indicates, either typed or stamped, that the document 
is a true copy of the original signed or initialed by (insert full name 
of signing officer), and it is signed by the certifying officer. If a 
certification is typed on a separate sheet of paper, it briefly 
describes the document certified and states that it is a true copy of 
the original signed by (full name) and it is signed by the certifying 
officer.



Sec. 181.7  Transmittal to the Congress.

    (a) International agreements other than treaties shall be 
transmitted by the Assistant Legal Adviser for Treaty Affairs to the 
President of the Senate and the Speaker of the House of Representatives 
as soon as practicable after the entry into force of such agreements, 
but in no event later than 60 days thereafter.
    (b) Classified agreements shall be transmitted by the Assistant 
Secretary of State for Congressional Relations to the Senate Committee 
on Foreign Relations and to the House Committee on Foreign Affairs.
    (c) The Assistant Legal Adviser for Treaty Affairs shall also 
transmit to the President of the Senate and to the Speaker of the House 
of Representatives background information to accompany each agreement 
reported under the Act. Background statements, while not expressly 
required by the act, have been requested by the Congress and have become 
an integral part of the reporting requirement. Each background statement 
shall include information explaining the agreement, the negotiations, 
the effect of the agreement, and a precise citation of legal authority. 
At the request of the Assistant Legal Adviser for Treaty Affairs, each 
background statement is to be prepared in time for transmittal with the 
agreement it accompanies by the office most closely concerned with the 
agreement. Background statements for classified agreements are to be 
transmitted by the Assistant Secretary of State for Congressional 
Relations to the Senate Committee on Foreign Relations and to the House 
Committee on Foreign Affairs.
    (d) Pursuant to section 12 of the Taiwan Relations Act (22 U.S.C. 
3311), any

[[Page 588]]

agreement entered into between the American Institute in Taiwan and the 
governing authorities on Taiwan, or any agreement entered into between 
the Institute and an agency of the United States Government, shall be 
transmitted by the Assistant Secretary of State for Congressional 
Relations to the President of the Senate and to the Speaker of the House 
of Representatives as soon as practicable after the entry into force of 
such agreements, but in no event later than 60 days thereafter. 
Classified agreements entered into by the Institute shall be transmitted 
by the Assistant Secretary for Congressional Relations to the Senate 
Committee on Foreign Affairs.



Sec. 181.8  Publication.

    (a) The following categories of international agreements will not be 
published in United States Treaties and Other International Agreements:
    (1) Bilateral agreements for the rescheduling of intergovernmental 
debt payments;
    (2) Bilateral textile agreements concerning the importation of 
products containing specified textile fibers done under the Agricultural 
Act of 1956, as amended;
    (3) Bilateral agreements between postal administrations governing 
technical arrangements;
    (4) Bilateral agreements that apply to specified military exercises;
    (5) Bilateral military personnel exchange agreements;
    (6) Bilateral judicial assistance agreements that apply only to 
specified civil or criminal investigations or prosecutions;
    (7) Bilateral mapping agreements;
    (8) Tariff and other schedules under the General Agreement on 
Tariffs and Trade and under the Agreement of the World Trade 
Organization;
    (9) Agreements that have been given a national security 
classification pursuant to Executive Order No. 12958 or its successors; 
and
    (b) Agreements on the subjects listed in paragraphs (a) (1) through 
(9) of this section that had not been published as of February 26, 1996.
    (c) Any international agreements in the possession of the Department 
of State, other than those in paragraph (a)(9) of this section, but not 
published will be made available upon request by the Department of 
State.
[61 FR 7071, Feb. 26, 1996]

[[Page 589]]



                      SUBCHAPTER T--HOSTAGE RELIEF





PART 191--HOSTAGE RELIEF ASSISTANCE--Table of Contents




                           Subpart A--General

Sec.
191.1  Declaration of hostile action.
191.2  Application for determination of eligibility.
191.3  Definitions.
191.4  Notification of eligible persons.
191.5  Relationships among agencies.
191.6  Effective date.

    Subpart B--Application of Soldiers' and Sailors' Civil Relief Act

191.10  Eligibility for benefits.
191.11  Applicable benefits.
191.12  Description of benefits.
191.13  Administration of benefits.

                       Subpart C--Medical Benefits

191.20  Eligibility for benefits.
191.21  Applicable benefits.
191.22  Administration of benefits.
191.23  Disputes.

                     Subpart D--Educational Benefits

191.30  Eligibility for benefits.
191.31  Applicable family benefits.
191.32  Applicable benefits for hostages.
191.33  Administration of benefits.
191.34  Maximum limitation on benefits.

    Authority:  Hostage Relief Act of 1980 (Pub. L. 96-449 and sec. 4 of 
Act of 1949 (22 U.S.C. 2658)).

    Source:  46 FR 17543, Mar. 19, 1981, unless otherwise noted.



                           Subpart A--General



Sec. 191.1  Declaration of hostile action.

    (a) The Secretary of State from time to time shall declare when and 
where individuals in the civil or uniformed services of the United 
States, or a citizen or resident alien of the United States rendering 
personal services to the United States abroad similar to the service of 
a civil officer or employee of the United States, have been placed in 
captive status because of hostile action abroad directed against the 
United States and occurring or continuing between November 4, 1979, and 
such date as may be declared by the President under section 101(2)(A) of 
the Hostage Relief Act of 1980 (Pub. L. 96-449, hereafter ``the Act'') 
or January 1, 1983, whichever is later. Each such declaration shall be 
published in the Federal Register.
    (b) The Secretary of State upon his or her own initiative, or upon 
application under Sec. 191.2 shall determine which individuals in 
captive status as so declared shall be considered hostages eligible for 
benefits under the Act. The Secretary shall also determine who is 
eligible under the Act for benefits as a member of a family or household 
of a hostage. The determination of the Secretary shall be final, but any 
interested person may request reconsideration on the basis of 
information not considered at the time of original determination. The 
criteria for determination are set forth in sections 101 and 205 of the 
Act, and in these regulations.



Sec. 191.2  Application for determination of eligibility.

    (a) Any person who believes that they or other persons known to them 
are either hostages as defined in the Act, or members of the family or 
household of hostages as defined in Sec. 191.3(a)(1), or a child 
eligible for benefits under subpart D, may apply for benefits under this 
subchapter for themselves, or on behalf of others entitled thereto.
    (b) The application shall be in writing, should contain all 
identifying and other pertinent data available to the person applying 
about the person or persons claimed to be eligible, and should be 
addressed to the Assistant Secretary of State for Administration, 
Department of State, Washington, DC 20520. Applications may be filed at 
any time after publication of a declaration under Sec. 191.1(a) in the 
Federal Register, and during the period of its validity, or within 60 
days after release from captivity. Later filing may be considered when 
in the opinion of the Secretary of State there is good cause for the 
late filing.

[[Page 590]]



Sec. 191.3  Definitions.

    When used in this subchapter, unless otherwise specified, the 
terms--
    (a) Family Member means (1) a spouse, (2) an unmarried dependent 
child including a step-child or adopted child, (3) a person designated 
in official records or determined by the agency head or designee thereof 
to be a dependent, or (4) other persons such as parents, parents-in-law, 
persons who stand in the place of a spouse or parents, or other members 
of a household when fully justified by the circumstances of the hostage 
situation, as determined by the Secretary of State.
    (b) Agency head means the head of an agency as defined in the Act 
(or successor agency) employing an individual determined to be an 
American hostage. The Secretary of State is the agency head with respect 
to any hostage not employed by an agency.
    (c) Principal means the hostage whose captivity forms the basis for 
benefits under this subchapter for a family member.



Sec. 191.4  Notification of eligible persons.

    The Assistant Secretary of State for Administration shall be 
responsible for notifying each individual determined to be eligible for 
benefits under the Act or, if that person is not available, a 
representative or Family Member of the hostage.



Sec. 191.5  Relationships among agencies.

    (a) The Assistant Secretary of State for Administration shall 
promptly inform the head of any agency whenever an employee (including a 
member of the Armed Forces) in that agency, or Family Member of such 
employee, is determined to be eligible for benefits under this 
subchapter.
    (b) In accordance with inter-agency agreements between the 
Department of State and relevant agencies--
    (1) The Veterans Administration will periodically bill the 
Department of State for expenses it pays for each eligible person under 
subpart D of this subchapter plus the administrative costs of carrying 
out its responsibilities under this part.
    (2) The Department of State will, on a periodic basis, determine the 
cost for services and benefits it provides to all eligible persons under 
this subchapter and bill each agency for the costs attributable to 
Principals (and Family Members) in or acting on behalf of the agency 
plus a proportionate share of related administrative expenses.



Sec. 191.6  Effective date.

    This regulation is effective as of November 4, 1979. Reimbursement 
may be made for expenses approved under this subchapter for services 
rendered on or after such date.



    Subpart B--Application of Soldiers' and Sailors' Civil Relief Act



Sec. 191.10  Eligibility for benefits.

    A person designated as a hostage under subpart A of this subchapter, 
other than a member of the Armed Forces covered by the provisions of the 
Soldiers' and Sailors' Civil Relief Act of 1940, shall be eligible for 
benefits under this part.



Sec. 191.11  Applicable benefits.

    (a) Eligible persons are entitled to the benefits provided by the 
Soldiers' and Sailors' Civil Relief Act of 1940 (50 U.S.C. App. 501, et 
seq.), including the benefits provided by section 701 (50 U.S.C. App. 
591) notwithstanding paragraph (c) thereof, but excluding the benefits 
provided by sections 104, 105, 106, 400 through 408, 501 through 512, 
and 514 (50 U.S.C. App. 514, 515, 516, 540 through 548, 561 through 572, 
and 574).
    (b) In applying such Act for purposes of this section--
    (1) The term ``person in the military service'' is deemed to include 
any such American hostage;
    (2) The term ``period of military service'' is deemed to include the 
period during which such American hostage is in a captive status;
    (3) References therein to the Secretary of the Army, the Secretary 
of the Navy, the Adjutant General of the Army, the Chief of Naval 
Personnel, and the Commandant, United States Marine Corps, or other 
officials of government are deemed to be references to the Secretary of 
State; and

[[Page 591]]

    (4) The term ``dependents'' shall, to the extent permissible by law, 
be construed to include ``Family Members'' as defined in section 101 of 
the Hostage Relief Act.



Sec. 191.12  Description of benefits.

    The following material is included to assist persons affected, by 
providing a brief description of some of the provisions of the Civil 
Relief Act. Note that not all of the sections applicable to hostages 
have been included here. References to sections herein are references to 
the Civil Relief Act of 1940, as amended, followed by references in 
parentheses to the same section in the United States Code.
    (a) Guarantors, endorsers. Section 103 (50 U.S.C. App. 513) provides 
that whenever a hostage is granted relief from the enforcement of an 
obligation, a court, in its discretion, may grant the same relief to 
guarantors and endorsers of the obligation. Amendments extend relief to 
accommodation makers and others primarily or secondarily liable on an 
obligation, and to sureties on a criminal bail bond. They provide, on 
certain conditions, that the benefits of the section with reference to 
persons primarily or secondarily liable on an obligation may be waived 
in writing.
    (b) Written Agreements. Section 107 (50 U.S.C. App. 517) provides 
that nothing contained in the Act shall prevent hostages from making 
certain arrangements with respect to their contracts and obligations, 
but requires that such arrangements be in writing.
    (c) Protection in Court. Section 200 (50 U.S.C. App. 520) provides 
that if a hostage is made defendant in a court action and is unable to 
appear in court, the court shall appoint an attorney to represent the 
hostage and protect the hostage's interests. Further, if a judgment is 
rendered against the hostage, an opportunity to reopen the case and 
present a defense, if meritorious, may be permitted within 90 days after 
release.
    (d) Court Postponement. Section 201 (50 U.S.C. App. 521) authorizes 
a court to postpone any court proceedings if a hostage is a party 
thereto and is unable to participate by reason of being a captive.
    (e) Relief Against Penalties. Section 202 (50 U.S.C. App. 522) 
provides for relief against fines or penalties when a court proceeding 
involving a hostage is postponed, or when the fine or penalties are 
incurred for failure to perform any obligation. In the latter case, 
relief depends upon whether the hostage's ability to pay or perform is 
materially affected by being held captive.
    (f) Postponement of Action. Section 203 (50 U.S.C. App. 523) 
authorizes a court to postpone or vacate the execution of any judgment, 
attachment or garnishment.
    (g) Period of Postponement. Section 204 (50 U.S.C. App. 524) 
authorizes a court to postpone proceedings for the period of captivity, 
and for 3 months thereafter, or any part thereof.
    (h) Extended Time Limits. Section 205 (50 U.S.C. App. 525) excludes 
the period of captivity from computing time under existing or future 
statutes of limitation. Amendments extend relief to include actions 
before administrative agencies, and provide that the period of captivity 
shall not be included in the period for redemption of real property sold 
to enforce any obligation, tax, or assessment. Section 207 excludes 
application of section 205 to any period of limitation prescribed by or 
under the internal revenue laws of the United States.
    (i) Interest Rates. Section 206 (50 U.S.C. App. 526) provides that 
interest on the obligations of hostages shall not exceed a specified per 
centum per annum, unless the court determines that ability to pay 
greater interest is not affected by being held captive.
    (j) Misuse of Benefits. Section 600 (50 U.S.C. App. 580) provides 
against transfers made with intent to delay the just enforcement of a 
civil right by taking advantage of the Act.
    (k) Further Relief. Section 700 (50 U.S.C. App. 590) provides that a 
person, during a period of captivity or 6 months thereafter, may apply 
to a court for relief with respect to obligations incurred prior to 
captivity, or any tax or assessment whether falling due prior to or 
during the period of captivity. The court may, on certain conditions, 
stay the enforcement of such obligations.

[[Page 592]]

    (l) Stay of Eviction. Section 300 (50 U.S.C. App. 530) provides that 
a hostage's dependents shall not be evicted from their dwelling if the 
rental is $150 or less per month, except upon leave of a court. If it is 
proved that inability to pay rent is a result of being in captivity, the 
court is authorized to stay eviction proceedings for not longer than 3 
months. An amendment extends relief to owners of the premises with 
respect to payments on mortgage and taxes.
    (m) Contract and Mortgage Obligations. As provided by sections 301 
and 302 of the Act (50 U.S.C. App. 531 and 532), as amended, contracts 
for the purchase of real and personal property, which originated prior 
to the period of captivity, may not be rescinded, terminated, or 
foreclosed, or the property repossessed, except as provided in section 
107 (50 U.S.C. App. 517), unless by an order of a court. The mentioned 
sections give the court wide discretionary powers to make such 
disposition of the particular case as may be equitable in order to 
conserve the interests of both the hostage and the creditor. The cited 
sections further provide that the court may stay the proceedings for the 
period of captivity and 3 months thereafter, if in its opinion the 
ability of the hostage to perform the obligation is materially affected 
by reason of captivity. Section 303 (50 U.S.C. App. 533) provides that 
the court may appoint appraisers and, based upon their report, order 
such sum as may be just, if any, paid to hostages or their dependents, 
as a condition to foreclosing a mortgage, resuming possession of 
property, and rescinding or terminating a contract.
    (n) Termination of a Lease. Section 304 (50 U.S.C. App. 534) 
provides, in general, that a lease covering premises occupied for 
dwelling, business, or agricultural purpose, executed by persons who 
subsequently become hostages, may be terminated by a notice in writing 
given to the lessor, subject to such action as may be taken by a court 
on application of the lessor. Termination of a lease providing for 
monthly payment of rent shall not be effective until 30 days after the 
first date on which the next rental payment is due, and, in the case of 
other leases, on the last day of the month following the month when the 
notice is served.
    (o) Assignment of Life Insurance Policy. Section 305 (50 U.S.C. App. 
535) provides that the assignee of a life insurance policy assigned as 
security, other than the insurer in connection with a policy loan, 
except upon certain conditions, shall not exercise any right with 
respect to the assignment during the period of captivity of the insured 
and one year thereafter, unless upon order of a court.
    (p) Storage Lien. Section 305 (50 U.S.C. App. 535) provides that a 
lien for storage of personal property may not be foreclosed except upon 
court order. The court may stay proceedings or make other just 
disposition.
    (q) Extension of Benefits to Dependents. Section 306 (50 U.S.C. App. 
536) extends the benefits to section 300 through 305 to dependents of a 
hostage.
    (r) Real and Personal Property Taxes. Section 500 (50 U.S.C. App. 
560) forbids sale of property, except upon court leave, to enforce 
collection of taxes or assessments (other than taxes on income) on 
personal property or real property owned and occupied by the hostage or 
dependents thereof at the commencement of captivity and still occupied 
by the hostage's dependents or employees. The court may stay proceedings 
for a period not more than 6 months after termination of captivity. When 
by law such property may be sold to enforce collection, the hostage will 
have the right to redeem it within 6 months after termination of 
captivity. Unpaid taxes or assessments bear interest at 6 percent.
    (s) Income Taxes. Section 513 provides for deferment of payment of 
income taxes. However, section 204 of the Hostage Relief Act of 1980 
provides for deferment and certain other relief, and should be referred 
to in order to determine statutory tax benefits in addition to those in 
section 513 of the Civil Relief Act.
    (t) Certification of Hostage. Section 601 provides that a 
certificate signed by the agency head shall be prima facie evidence that 
the person named has been a hostage during the period specified in the 
certification.
    (u) Interlocutory Orders. Section 602 (50 U.S.C. App. 582) provides 
that a

[[Page 593]]

court may revoke an interlocutory order it has issued pursuant to any 
provision of the Soldiers' and Sailors' Civil Relief Act of 1940.
    (v) Power of Attorney. Section 701 (50 U.S.C. App. 591) provides 
that certain powers of attorney executed by a hostage which expire by 
their terms after the person was captured shall be automatically 
extended for the period of captivity. Exceptions are made with respect 
to powers of attorney which by their terms clearly indicate they are to 
expire on the date specified irrespective of hostage status. (Section 
701 applies to American hostages notwithstanding paragraph (c) thereof 
which states that it applies only to powers of attorney issued during 
the ``Vietnam era''.)



Sec. 191.13  Administration of benefits.

    (a) The Assistant Secretary of State for Administration will issue 
certifications or other documents when required for purposes of the 
Civil Relief Act.
    (b) The Assistant Secretary of State shall whenever possible 
promptly inform the chief legal officer of each State in which hostages 
maintain residence of all persons determined to be hostages eligible for 
assistance under this subpart.



                       Subpart C--Medical Benefits



Sec. 191.20  Eligibility for benefits.

    A person designated as a hostage or Family Member of a hostage under 
subpart A of this subchapter shall be eligible for benefits under this 
subpart.



Sec. 191.21  Applicable benefits.

    A person eligible for benefits under this part shall be eligible for 
authorized medical and health care at U.S. Government expense, and for 
payment of other authorized expenses related to such care or for 
obtaining such care for any illness or injury which is determined by the 
Secretary of State to be caused or materially aggravated by the hostage 
situation, to the extent that such care may not--
    (a) Be provided or paid for under any other Government health or 
medical program, including, but not limited to, the programs 
administered by the Secretary of Defense, the Secretary of Labor and the 
Administrator of Veterans Affairs; or
    (b) Be entitled to reimbursement by any private or Government health 
insurance or comparable plan.



Sec. 191.22  Administration of benefits.

    (a) An eligible person, who desires medical or health care under 
this subpart or any person acting on behalf thereof, shall submit an 
application to the Office of Medical Services, Department of State, 
Washington, DC 20520 (hereafter referred to as the ``Office''). The 
applicant shall supply all relevant information, including insurance 
information, requested by the Director of the Office. An eligible person 
may also submit claims to the Office for payment for emergency care when 
there is not time to obtain prior authorization as prescribed by this 
paragraph, and for payment for care received prior to or ongoing on the 
effective date of these regulations.
    (b) The Office shall evaluate all requests for care and claims for 
reimbursement and determine, on behalf of the Secretary of State, 
whether the care in question is authorized under Sec. 191.21 of this 
subpart. The Office will authorize care, or payment for care when it 
determines the criteria of such section are met. Authorization shall 
include a determination as to the necessity and reasonableness of 
medical or health care.
    (c) The Office will refer applicants eligible for benefits under 
other Government health programs to the Government agency administering 
those programs. Any portion of authorized care not provided or paid for 
under another Government program will be reimbursed under this subpart.
    (d) Eligible persons may obtain authorized care from any licensed 
facility or health care provider of their choice approved by the Office. 
To the extent possible, the Office will attempt to arrange for 
authorized care to be provided in a Government facility at no cost to 
the patient.
    (e) Authorized care provided by a private facility or health care 
provider will be paid or reimbursed under this subpart to the extent 
that the Office determines that costs do not exceed

[[Page 594]]

reasonable and customary charges for similar care in the locality.
    (f) All bills for authorized medical or health care covered by 
insurance shall be submitted to the patient's insurance carrier for 
payment prior to submission to the Office for payment of the balance 
authorized by this part. The Office will request the health care 
providers to bill the insurance carrier and the Department of State for 
authorized care, rather than the patient.
    (g) Eligible persons will be reimbursed by the Office for authorized 
travel to obtain an evaluation of their claim under paragraph (b) of 
this section and for other authorized travel to obtain medical or health 
care authorized by this subpart.



Sec. 191.23  Disputes.

    Any dispute between the Office and eligible persons concerning (a) 
whether medical or health care is required in a given case, (b) whether 
required care is incident to the hostage taking, or (c) whether the cost 
for any authorized care is reasonable and customary, shall be referred 
to the Medical Director, Department of State and the Foreign Service for 
a determination. If the person bringing the claim is not satisfied with 
the decision of the Medical Director, the dispute shall be referred to a 
medical board composed of three physicians, one appointed by the Medical 
Director, one by the eligible person and the third by the first two 
members. A majority decision by the board shall be binding on all 
parties.



                     Subpart D--Educational Benefits



Sec. 191.30  Eligibility for benefits.

    (a) A spouse or unmarried dependent child aged 18 or above of a 
hostage as determined under subpart A of this subchapter shall be 
eligible for benefits under Sec. 191.31 of this subpart. (Certain 
limitations apply, however, to persons eligible for direct assistance 
through other programs of the Veterans Administration under chapter 35 
of title 38, United States Code).
    (b) A Principal (see definition in Sec. 191.3) designated as a 
hostage under Subpart A of this subchapter, who intends to change jobs 
or careers because of the hostage experience and who desires additional 
training for this purpose, shall be eligible for benefits under 
Sec. 191.32 of this part unless such person is eligible for comparable 
benefits under title 38 of the United States Code as determined by the 
Administrator of the Veterans Administration.



Sec. 191.31  Applicable family benefits.

    (a) An eligible spouse or child shall be paid (by advancement or 
reimbursement) for expenses incurred for subsistence, tuition, fees, 
supplies, books, and equipment, and other educational expenses, while 
attending an educational or training institution approved in accordance 
with procedures established by the Veterans Administration, which shall 
be comparable to procedures established pursuant to chapters 35 and 36 
of title 38 U.S.C.
    (b) Except as provide in paragraph (c) or (d) of this section), 
payments shall be available under this subsection for an eligible spouse 
or child for education or training which occurs--
    (1) 90 days after the Principal is placed in a captive status, and
    (i) Through the end of any semester or quarter which begins before 
the date on which the Principal ceases to be in a captive status, or
    (ii) If the educational or training institution is not operated on a 
semester or quarter system, the earlier of the end of any course which 
began before such date or the end of the twelve-week period following 
that date.
    (c) In special circumstances and within the limitation of 
Sec. 191.34, the Secretary of State may, under the criteria and 
procedures set forth in Sec. 191.33, approve payments for education or 
training under this subsection which occurs after the date determined 
under paragraph (b) of this section.
    (d) In the event a Principal dies and the death is determined by the 
Secretary of State to be incident to that individual being a hostage, 
payments shall be available under this subsection for education or 
training of a spouse or child of the Principal which occurs after the 
date of death, up to the maximum that may be authorized under 
Sec. 191.34.

[[Page 595]]



Sec. 191.32  Applicable benefits for hostages.

    (a) When authorized by the Secretary of State a Principal, following 
released from captivity, shall be paid (by advancement or reimbursement) 
for expenses incurred for subsistence, tuition, fees, supplies, books 
and equipment, and other educational expenses, while attending an 
educational or training institution approved in accordance with 
procedures established by the Veterans Administration comparable to 
procedures established pursuant to chapters 35 and 36 of title 38 U.S.C. 
Payments shall be available under this subsection for education or 
training which occurs on or before--
    (1) The end of any semester or quarter (as appropriate) which begins 
before the date which is 10 years after the day on which the Principal 
ceases to be in a captive status, or
    (2) If the educational or training institution is not operated on a 
semester or quarter system, the earlier of the end of any course which 
began before such date or the end of the twelve-week period following 
that date.
    (b) A person eligible for benefits under this subsection shall not 
be required to separate from Government service in order to undertake 
the training or education, but while in Government service, may only 
receive such training or education during off-duty hours or during 
periods of approved leave.



Sec. 191.33  Administration of benefits.

    (a) Any person desiring benefits under this part shall apply in 
writing to the Assistant Secretary of State for Administration, 
Department of State, Washington, DC 20520. The application shall specify 
the benefits desired and the basis of eligibility for those benefits. 
The Secretary of State shall make determinations of eligibility for 
benefits under this part, and shall forward approved applications to the 
Veterans Administration and advise the applicant of the name and address 
of the office in the Veterans Administration that will counsel the 
eligible persons on how to obtain the benefits that have been approved. 
Persons whose applications are disapproved shall be advised of the 
reasons for the disapproval.
    (b) The Veterans Administration shall provide the same level and 
kind of assistance, including payments (by advancement or reimbursement) 
for authorized expenses up to the same maximum amounts, to spouses and 
children of hostages, and to Principals following their release from 
captivity as it does to eligible spouses and children of veterans and to 
eligible veterans, respectively, under chapters 35 and 36 of title 38, 
United States Code. The Veterans Administration shall, following 
consultation with the Secretary of State and under procedures it has 
established to administer section 1724 of title 38, United States Code, 
discontinue assistance for any individual whose conduct or progress is 
unsatisfactory under standards consistent with those established 
pursuant to such section 1724.
    (c) An Advisory Board shall be established to advise on eligibility 
for benefits under paragraphs (c) and (d) of Secs. 191.31 and 191.32. 
The Board shall be composed of the Assistant Secretary of State for 
Administration as Chairperson, the Director of the Office of Medical 
Services of the Department of State, the Executive Director of the 
regional bureau of the Department of State in whose region the relevant 
hostile action occurred, the Director of Personnel or other designee of 
the applicable employing agency, and a representative of the Veterans 
Administration designated by the Administrator.
    (d) If an application is received from a spouse or child for 
extended training under Sec. 191.31(c), the Secretary of Administration 
shall determine with the advice of the Advisory Board whether the 
Principal, following release from captivity, is incapacitated by the 
hostage experience to the extent that (1) he or she has not returned to 
full-time active duty and is unlikely to be able to resume the normal 
duties of his or her position or career, or (2) in the event of a 
separation from Government service, a comparable position or career, for 
at least six months from the date the Principal is released from 
captivity. If the Secretary makes such a determination, he or she may 
approve, within the limits of Sec. 191.34, an application under 
Sec. 191.31(c) for up to one year

[[Page 596]]

of education or training. If the Principal remains incapacitated, the 
Secretary may approve additional training or education up to the maximum 
authorized under Sec. 191.34.



Sec. 191.34  Maximum limitation on benefits.

    (a) In no event may assistance be provided under this subpart for 
any individual for a period in excess of 45 months, or the equivalent 
thereof in part-time education or training.
    (b) The eligibility of a spouse for benefits under paragraph (c) or 
(d) of Sec. 191.31 shall expire on a date which is 10 years after the 
date of the release of the hostage, or the death of the hostage, 
respectively. The eligibility of a dependent child for benefits under 
such paragraphs (c) and (d) shall expire on the 26th birthday of such 
child or on such later date as determined by the Administrator of the 
Veterans Administration, as would be applicable if section 1712 of title 
38, United States Code, were applicable.



PART 192--VICTIMS OF TERRORISM COMPENSATION--Table of Contents




                           Subpart A--General

Sec.
192.1  Declarations of hostile action.
192.2  Application for determination of eligibility.
192.3  Definitions.
192.4  Notification of eligible persons.
192.5  Relationships among agencies.

 Subpart B--Payment of Salary and Other Benefits for Captive Situations

192.10  Eligibility for benefits.
192.11  Applicable benefits.
192.12  Administration of benefits.

  Subpart C--Application of Soldiers' and Sailors' Civil Relief Act to 
                           Captive Situations

192.20  Eligibility for benefits.
192.21  Applicable benefits.
192.22  Description of benefits.
192.23  Administration of benefits.

           Subpart D--Medical Benefits for Captive Situations

192.30  Eligibility for benefits.
192.31  Applicable benefits.
192.32  Administration of benefits.
192.33  Dispute.

         Subpart E--Educational Benefits for Captive Situations

192.40  Eligibility for benefits.
192.41  Applicable family benefits.
192.42  Applicable benefits for captives.
192.43  Administration of benefits.
192.44  Maximum limitation on benefits.

             Subpart F--Compensation for Disability or Death

192.50  Eligibility for benefits.
192.51  Death benefit.
192.52  Disability benefits.

    Authority:  5 U.S.C. 5569 and 5570 and E.O. 12598 (52 FR 23421).

    Source:  54 FR 12597, Mar. 28, 1989, unless otherwise noted.



                           Subpart A--General



Sec. 192.1  Declarations of hostile action.

    (a)(1) The Secretary of State shall declare when and where 
individuals in the Civil Service of the United States, including members 
of the Foreign Service and foreign service nationals, or a citizen, 
national or resident alien of the United States rendering personal 
services to the United States similar to the service of an individual in 
the Civil Service, have been placed in captive status commencing on or 
after November 4, 1979, for purposes of Sec. 192.11(b) or January 21, 
1981, for all other purposes under this part, which arises because of 
hostile action abroad and is a result of the individual's relationship 
with the U.S. Government as provided in the Victims of Terrorism 
Compensation Act, codified in 5 U.S.C. 5569 and 5570 and Executive Order 
12598.
    (2) The Secretary of State, in consultation with the Secretary of 
Labor, shall also declare when and where individuals in the Civil 
Service of the United States including members of the Foreign Service 
and foreign service nationals, including individuals rendering personal 
services to the United States similar to the service of an individual in 
the Civil Service, and family members of these individuals are eligible 
to receive compensation for disability or death occurring after January 
21, 1981. Such determination shall be based on the decision by the 
Secretary of State that the disability or death was caused by hostile 
action abroad

[[Page 597]]

and was a result of the individual's relationship with the Government.
    (3) Declarations of hostile action in domestic situations shall be 
made by the Secretary of State in consultation with the Attorney General 
of the United States and the head of the employing agency or agencies.
    (b) The Secretary of State for actions abroad, or Agency Head for 
domestic actions, upon his or her own initiative, or upon application 
under Sec. 192.2 shall determine which individuals in captive or missing 
status as so declared shall be considered captives eligible for benefits 
under the Act. The Secretary or Agency Head shall also determine who is 
eligible under the Act for benefits as a member of a family or household 
of a captive. The determination of the Secretary or Agency Head shall be 
final for purposes of determining captive status and cash payments, and 
not subject to judicial review, but any interested person may request 
reconsideration on the basis of information not considered at the time 
of original determination. The criteria for determination are set forth 
in sections 5569 and 5570 of title 5 of U.S.C., and in these 
regulations.



Sec. 192.2  Application for determination of eligibility.

    (a) Any person who believes that that person or other persons known 
to that person are either captives as defined in 5 U.S.C. 5569(a)(1), 
individuals who have suffered disability or death caused by hostile 
action which was a result of the individual's relationship with the U.S. 
Government, members of the family or household of such individuals as 
defined in Sec. 192.3(a)(1), or a child eligible for benefits under 
subchapter D, may apply for benefits under this subchapter for that 
person, or on behalf of others entitled thereto.
    (b) The application in connection with hostile action abroad shall 
be in writing, shall contain all identifying and other pertinent data 
available to the person applying about the person or persons claimed to 
be eligible, and shall be addressed to the Director General of the 
Foreign Service, Department of State, Washington, DC 20520. Applications 
may be filed within 60 days after the latest of: a declaration under 
Sec. 192.1(a), the hostile action, or release from captivity. Later 
filing may be considered when in the opinion of the Secretary of State 
there is good cause for the late filing. Applications in connection with 
hostile action in domestic situations shall conform to these same 
requirements and be filed with the Agency Head.



Sec. 192.3  Definitions.

    When used in this subchapter, unless otherwise specified, the 
terms--
    (a) Secretary of State includes any person to whom the Secretary of 
State has delegated the responsibilities of carrying out this subpart.
    (b) Family Member means a dependent of a captive and any individual 
other than a dependent who is a member of such person's family or 
household and shall include the following: (1) A spouse, (2) an 
unmarried dependent child including a step-child or adopted child under 
21 years of age, (3) a person designated in official records or 
determined by the agency head or designee thereof to be dependent, and 
(4) other persons such as parents, non-dependent children, parents-in-
law, persons who stand in the place of a spouse or parents, or other 
members of the family or household of a captive or employee, as 
determined by the Agency head concerned.
    (c) Agency Head means the head of an Executive Agency of the U.S. 
Federal Government employing an individual affected by hostile action as 
covered by these regulations. The Secretary of State is the agency head 
for actions abroad with respect to any such individual not employed by 
an agency.
    (d) Captive means any individual in a captive status commencing 
while such individual is in the Civil Service or a citizen, national or 
resident alien of the United States rendering personal service to the 
United States similar to the service of an individual in the Civil 
Service (other than as a member of the uniformed services).
    (e) Captive Status means a missing status which, as determined under 
Sec. 192.1, arises because of a hostile action and is a result of the 
individual's relationship with the Government.
    (f) Principal means the person whose captivity, death or disability 
forms the

[[Page 598]]

basis for benefits for that individual or for a family member under this 
subchapter.
    (g) Individual rendering personal services to the United States 
similar to the service of an individual in the Civil Service includes 
contract employees and other individuals fitting that description.
    (h) Pay and Allowances has the meaning set forth in 5 U.S.C. 
5561(6):
    (1) Basic pay;
    (2) Special pay;
    (3) Incentive pay;
    (4) Basic allowances for quarters;
    (5) Basic allowance for subsistence; and
    (6) Station per diem allowances for not more than 90 days.
    (i) Child means a dependent as defined in paragraph (b)(2) of this 
section.



Sec. 192.4  Notification of eligible persons.

    The Director General of the Foreign Service for the Department of 
State, or other Agency Head in domestic situations, shall be responsible 
for notifying each individual determined to be eligible for benefits 
under the Act, or if that person is not available, a representative or 
family member of the eligible individual.



Sec. 192.5  Relationships among agencies.

    (a) To assist in ensuring that eligible persons receive 
compensation, each Agency Head shall notify the Director General of the 
Foreign Service of the Department of State of any incident which he or 
she believes may be appropriately declared a hostile action under 
Sec. 192.1.
    (b) The Director General of the Foreign Service for the Department 
of State shall promptly inform the head of any agency whenever an 
employee of that agency, or Family Member of such employee, is 
determined to be eligible for benefits under this subchapter in 
connection with hostile action.
    (c) In accordance with inter-agency agreements between the 
Department of State and relevant agencies--
    (1) The Department of Veterans Affairs will periodically bill the 
Department of State for expenses it pays for each eligible person under 
subpart E of this subchapter plus the administrative costs of carrying 
out its responsibilities under this part.
    (2) The Department of State will, on a periodic basis, determine the 
cost for services and benefits it provides to all eligible persons under 
this subchapter, and bill each agency for the medical service costs (in 
connection with hostile action abroad) and educational benefits 
attributable to Principals and Family Members, plus a proportionate 
share of related administrative expenses.



 Subpart B--Payment of Salary and Other Benefits for Captive Situations



Sec. 192.10  Eligibility for benefits.

    A person designated as a captive under subpart A of this subchapter 
shall be eligible for benefits under this subpart.



Sec. 192.11  Applicable benefits.

    (a) Captives are entitled to receive or have credited to their 
account, for the period in captive status, the same pay and allowances 
to which they were entitled at the beginning of that period or to which 
they may have become entitled thereafter.
    (b) A person designated as a captive (or a family member of a 
principal) under subpart A of this subchapter whose captivity commenced 
on or after November 4, 1979, is also entitled to receive a cash payment 
from the captive's employing agency, for each day held captive, in an 
amount equal to but not less than one-half of the amount of the world-
wide average per diem rate established under 5 U.S.C. 5702.



Sec. 192.12  Administration of benefits.

    (a) The amount deducted from the pay and allowances of captives must 
be recorded in the individual accounts of the agency concerned. A 
Treasury designated account, set up on the books of the agency 
concerned, may be utilized by the head of an agency to report the net 
amount of pay, allowances and interest credited to captives pursuant to 
5 U.S.C. 5569(b). Interest payments under this section shall be paid out 
of funds available for salaries and expenses of the agency. Interest 
shall be

[[Page 599]]

computed at a rate for any calendar quarter equal to the average rate 
paid on United States Treasury bills with 3-month maturities issued 
during the preceding calendar quarter, with quarterly compounding.
    (b) Cash payments to captives for each day of captivity shall be 
made by the head of an agency before the end of the one-year period 
beginning on the date on which the captive status terminates. In the 
event the captive dies in captivity or prior to payment of these 
benefits, payment shall be made to the eligible survivors under 
Sec. 192.51(c) or the estate. A payment under this subchapter may be 
deferred or denied by the head of an agency pending determination of an 
offense committed by the captive under the provisions of 5 U.S.C. 8312.



  Subpart C--Application of Soldiers' and Sailors' Civil Relief Act to 
                           Captive Situations



Sec. 192.20  Eligibility for benefits.

    A person designated as a captive under subpart A of this subchapter, 
shall be eligible for benefits under this part.



Sec. 192.21  Applicable benefits.

    (a) Eligible persons are entitled to the benefits provided by the 
Soldiers' and Sailors' Civil Relief Act of 1940 (50 U.S.C. App. 501, et 
seq.), including the benefits provided by section 701 (50 U.S.C. App 
591) notwithstanding paragraph (c) thereof, but excluding the benefits 
provided by sections 104, 105, 106, 400 through 408, 501 through 512, 
and 514 (50 U.S.C. App. 514, 515, 516, 540 through 548, 561 through 572, 
and 574).
    (b) In applying such Act for purposes of this section--
    (1) The term person in the military service is deemed to include any 
such captive;
    (2) The term period of military service is deemed to include the 
period during which such captive is in a captive status;
    (3) References therein to the Secretary of the Army, the Secretary 
of the Navy, the Adjutant General of the Army, the Chief of Naval 
Personnel, and the Commandant, United States Marine Corps, or other 
officials of government are deemed, in the case of any captive, to be 
references to the Secretary of State; and
    (4) The term dependents shall, to the extent permissible by law, be 
construed to include ``Family Members'' as defined in Sec. 192.3 of 
these regulations.



Sec. 192.22  Description of benefits.

    The following material is included to assist persons affected, by 
providing a brief description of some of the provisions of the Civil 
Relief Act. Note that not all of the sections applicable to captives 
have been included here. References to sections herein are references to 
the Civil Relief Act of 1940, as amended, followed by references in 
parentheses to the same section in the United States Code.
    (a) Guarantors, endorsers. Section 103 (50 U.S.C. App 513) provides 
that whenever a captive is granted relief from the enforcement of an 
obligation, a court, in its discretion, may grant the same relief to 
guarantors and endorsers of the obligation. Amendments extend relief to 
accommodation makers and others primarily or secondarily liable on an 
obligation, and to sureties on a criminal bail bond. They provide, on 
certain conditions, that the benefits of the section with reference to 
persons primarily or secondarily liable on an obligation may be waived 
in writing.
    (b) Written agreements. Section 107 (50 U.S.C. App. 517) provides 
that nothing contained in the Act shall prevent captives from making 
certain arrangements with respect to their contracts and obligations, 
but requires that such arrangements be in writing.
    (c) Protection in court. Section 200 (50 U.S.C. App. 517) provides 
that if a captive is made a defendant in a court action and is unable to 
appear in court, the court shall appoint an attorney to represent the 
captive and protect the captive's interests. Further, if a judgment is 
rendered against the captive, an opportunity to reopen the case and 
present a defense, if meritorious, may be permitted within 90-days after 
release.
    (d) Court postponement. Section 201 (50 U.S.C. App. 521) authorizes 
a court to postpone any court proceedings if a captive is a party 
thereto and is unable

[[Page 600]]

to participate by reason of being a captive.
    (e) Relief against penalties. Section 202 (50 U.S.C. App. 522) 
provides for relief against fines or penalties when a court proceeding 
involving a captive is postponed, or when the fine or penalties are 
incurred for failure to perform any obligation. In the latter case, 
relief depends upon whether the captive's ability to pay or perform is 
materially affected by being held captive.
    (f) Postponement of action. Section 203 (50 U.S.C. App. 523) 
authorizes a court to postpone or vacate the execution of any judgment, 
attachment or garnishment.
    (g) Period of postponement. Section 204 (50 U.S.C. App. 524) 
authorizes a court to postpone proceedings for the period of captivity 
and for 3 months thereafter, or any part thereof.
    (h) Extended time limits. Section 205 (50 U.S.C. App. 525) excludes 
the period of captivity from computing time under existing or future 
statutes of limitation. Amendments extend relief to include actions 
before administrative agencies, and provide that the period of captivity 
shall not be included in the period for redemption of real property sold 
to enforce any obligation, tax, or assessment. Section 207 excludes 
application of section 205 to any period of limitation prescribed by or 
under the internal revenue laws of the United States.
    (i) Interest rates. Section 206 (50 U.S.C. App. 526) provides that 
interest on the obligations of captives shall not exceed a specified per 
centum per annum, unless the court determines that ability to pay 
greater interest is not affected by being held captive.
    (j) Misuse of benefits. Section 600 (50 U.S.C. App. 580) provides 
against transfers made with intent to delay the just enforcement of a 
civil right by taking advantage of the Act.
    (k) Further relief. Section 700 (50 U.S.C. App. 590) provides that a 
person, during a period of captivity or 6 months thereafter, may apply 
to a court for relief with respect to obligations incurred prior to 
captivity, or any tax or assessment whether falling due prior to or 
during the period of captivity. The court may, on certain conditions, 
stay the enforcement of such obligations.
    (l) Stay of eviction. Section 300 (50 U.S.C. App. 530) provides that 
a captive's dependents shall not be evicted from their dwelling if the 
rental is minimal, except upon leave of a court. If it is proved that 
inability to pay rent is a result of being in captivity, the court is 
authorized to stay eviction proceedings for not longer than 3 months. An 
amendment extends relief to owners of the premises with respect to 
payment on mortgage and taxes.
    (m) Contract and mortgage obligations. As provided by sections 301 
and 302 of the Act (50 U.S.C. App. 531 and 532), as amended, contracts 
for the purchase of real and personal property, which originated prior 
to the period of captivity, may not be rescinded, terminated, or 
foreclosed, or the property repossessed, except as provided in section 
107 (50 U.S.C. App. 517), unless by an order of a court. The mentioned 
sections give the court wide discretionary powers to make such 
disposition of the particular case as may be equitable in order to 
conserve the interests of both the captive and the creditor. The cited 
sections further provide that the court may stay the proceedings for the 
period of captivity and 3 months thereafter, if in its opinion the 
ability of the captive to perform the obligation is materially affected 
by reason of captivity. Section 303 (50 U.S.C. App. 533) provides that 
the court may appoint appraisers and, based upon their report, order 
such sum as may be just, if any, paid to captives or their dependents, 
as a condition to foreclosing a mortgage, resuming possession of 
property, and rescinding or terminating a contract.
    (n) Termination of a lease. Section 304 (50 U.S.C. App. 534) 
provides, in general, that a lease covering premises occupied for 
dwelling, business, or agricultural purpose, executed by persons who 
subsequently become captives, may be terminated by a notice in writing 
given to the lessor, subject to such action as may be taken by a court 
on application of the lessor. Termination of a lease providing for 
monthly payment of rent shall not be effective until 30 days after the 
first date on which the next rental payment is due, and, in

[[Page 601]]

the case of other leases, on the last day of the month following the 
month when the notice is served.
    (o) Assignment of life insurance policy. Section 305 (50 U.S.C. App. 
535) provides that the assignee of a life insurance policy assigned as 
security, other that the insurer in connection with a policy loan, 
except upon certain conditions, shall not exercise any right with 
respect to the assignment during period of captivity of the insured and 
one year thereafter, unless upon order of a court.
    (p) Storage lien. Section 305 (50 U.S.C. App. 535) provides that a 
lien for storage of personal property may not be foreclosed except upon 
court order. The court may stay proceedings or make other just 
disposition.
    (q) Extension of benefits to dependents. Section 306 (50 U.S.C. App. 
536) extends the benefits to section 300 through 305 to dependents of a 
captive.
    (r) Real and personal property taxes. Section 500 (50 U.S.C. App. 
560) forbids sale of property, except upon court leave, to enforce 
collection of taxes or assessments (other than taxes on income) on 
personal property or real property owned and occupied by the captive or 
dependents thereof at the commencement of captivity and still occupied 
by the captive's dependents or employees. The court may stay proceedings 
for a period not more than 6 months after termination of captivity. When 
by law such property may be sold to enforce collection, the captive will 
have the right to redeem it within 6 months after termination of 
captivity. Unpaid taxes or assessments bear interest at 6 percent.
    (s) Income taxes. Section 513 provides for deferment of payment of 
income taxes.
    (t) Certification of captive. Section 601 provides that a 
certificate signed by the agency head shall be prima facie evidence that 
the person named has been a captive during the period specified in the 
certification.
    (u) Interlocutory orders. Section 602 (50 U.S.C. App. 582) provides 
that a court may revoke an interlocutory order it has issued pursuant to 
any provision of the Soldiers' and Sailors' Civil Relief Act of 1940.
    (v) Power of attorney. Section 701 (50 U.S.C. App. 591) provides 
that certain powers of attorney executed by a captive which expire by 
their terms after the person was captured shall be automatically 
extended for the period of captivity. Exceptions are made with respect 
to powers of attorney which by their terms clearly indicate they are to 
expire on the date specified irrespective of captive status. (Section 
701 applies to American captives notwithstanding paragraph (c) thereof 
which states that it applies only to powers of attorney issued during 
the ``Vietnam era'').



Sec. 192.23  Administration of benefits.

    (a) The Director General of the Department of State or Agency Head 
will issue certifications or other documents when required for purposes 
of the Civil Relief Act.
    (b) The Director General of the Department of State or Agency Head 
shall whenever possible promptly inform the chief legal officer of each 
U.S. State in which captives maintain residence of all persons 
determined to be captives eligible for assistance under this subpart.



           Subpart D--Medical Benefits for Captive Situations



Sec. 192.30  Eligibility for benefits.

    A person designated as a captive or family member of a captive under 
subpart A of this subchapter, shall be eligible for benefits under this 
subpart.



Sec. 192.31  Applicable benefits.

    A person eligible for benefits under this part shall be eligible for 
authorized physical and mental health care at U.S. Government expense 
(through either or advancement or reimbursement), and for payment of 
other authorized expenses related to such care or for obtaining such 
care for any illness or injury, to the extent, as determined by the 
Secretary of State or Agency Head, that such care is incident to an 
individual being held captive and is not covered by--
    (a) Any other Government health or medical program, including, but 
not limited to, the programs administered

[[Page 602]]

by the Secretary of Defense, the Secretary of Labor and the Secretary of 
Veteran Affairs; or
    (b) Reimbursement by any private or Government health insurance or 
comparable plan. In the case of coverage by a private or Government 
health insurance plan, that carrier will be designated as the primary 
carrier, and benefits under this subpart will serve only to supplement 
expenses not paid by the primary carrier.



Sec. 192.32  Administration of benefits.

    (a) (1) A person eligible due to hostile action abroad, who desires 
medical or health care under this subpart or any person acting on behalf 
thereof, shall submit an application to the Office of Medical Services, 
Department of State, Washington, DC 20520 (hereafter referred to as the 
``Office''). That office will handle and process medical applications 
and claims using the criteria in this subpart. Persons eligible in 
connection with domestic situations shall make application with the 
Agency Head, and the Agency Head shall apply the following procedures in 
a similar manner in administering medical benefits in domestic 
situations involving the respective agency.
    (2) The applicant shall supply all relevant information, including 
insurance information, requested by the Director of the Office. An 
eligible person may also submit claims to the Office for payment for 
emergency care when there is not time to obtain prior authorization as 
prescribed by this paragraph.
    (b) The Office shall evaluate all requests for care and claims for 
reimbursement and determine, on behalf of the Secretary of State, 
whether the care in question is authorized under Sec. 192.31 of this 
subpart. The Office will authorize care or payment of care, when it 
determines the criteria of Sec. 192.31 are met. Authorization shall 
include a determination as to the necessity and reasonableness of 
medical or health care.
    (c) The Office will refer applicants eligible for benefits under 
other Government health programs to the Government agency administering 
those programs. Any portion of authorized care not provided or paid for 
under another Government program or private insurance will be reimbursed 
under this subpart, subject to a determination of the reasonableness of 
charges. Such determination shall be made by applying the fee schedule 
established by the Office of Workers' Compensation Programs (OWCP), 
Department of Labor, which is used in paying medical benefits for work-
related injuries to employees who are fully covered by OWCP.
    (d) Eligible persons may obtain authorized care from any licensed 
facility or health care provider of their choice approved by the Office. 
To the extent possible, the Office will attempt to arrange for 
authorized care to be provided in a Government facility at no cost to 
the patient.
    (e) Authorized care provided by a private facility or health care 
provider will be paid or reimbursed under this subpart to the extent 
that the Office determines that costs do not exceed reasonable and 
customary charges for similar care in the locality.
    (f) All bills for authorized medical or health care covered by 
insurance shall be submitted to the patient's insurance carrier for 
payment prior to submission to the Office for payment of the balance 
authorized by this part. The Office will request the health care 
providers to bill the insurance carrier and the Department of State for 
authorized care, rather than the patient.
    (g) Eligible persons will be reimbursed by the Office for authorized 
travel to obtain an evaluation of their claim under paragraph (b) of 
this section and for other authorized travel to obtain medical or health 
care authorized by this subpart.



Sec. 192.33  Dispute.

    Any dispute between the Office and eligible persons concerning 
whether medical or health care is required in a given case, whether 
required care is incident to the captivity, or whether the cost for any 
authorized care is reasonable and customary, shall be referred to the 
Medical Director, Department of State, for a determination. If the 
person bringing the claim is not satisfied with the decision of the 
Medical Director, the dispute shall be referred to a

[[Page 603]]

medical board composed of three physicians, one appointed by the Medical 
Director, one by the eligible person and the third by the first two 
members. A majority decision by the board shall be binding on all 
parties.



         Subpart E--Educational Benefits for Captive Situations



Sec. 192.40  Eligibility for benefits.

    (a) A spouse or unmarried dependent child (including an unmarried 
dependent stepchild or adopted child) under 21 years of age of a captive 
as determined under subpart A of the subchapter shall be eligible for 
benefits under 192.41 of this subpart. (Certain limitations apply, 
however, to persons eligible for direct assistance through other 
programs of the Department of Veterans' Affairs under chapter 35 of 
title 38, United States Code).
    (b) A Principal designated as a captive under subpart A of this 
subchapter, who intends to change jobs or careers because of the captive 
experience and who desires additional training for this purpose, shall 
be eligible for benefits under Sec. 192.42 of this part, unless the 
Secretary of the Department of Veterans' Affairs determines that such 
person is eligible to receive educational assistance for the additional 
training under either chapters 30, 32, 34, or 35, title 38 U.S.C.



Sec. 192.41  Applicable family benefits.

    (a) An eligible spouse or child shall be paid (by advancement or 
reimbursement) for expenses incurred for subsistence, tuition, fees, 
supplies, books and equipment, and other educational expenses while 
attending an educational or training institution approved in accordance 
with procedures established by the Department of Veterans' Affairs, 
which shall be comparable to procedures established pursuant to chapters 
35 and 36 of title 38 U.S.C.
    (b) Except as provided in paragraph (c) or (d) of this section, 
payments shall be available under this subsection for an eligible spouse 
or child for educational training which occurs--
    (1) 90 days after the Principal is placed in a captive status, and
    (i) Through the end of any semester or quarter which begins before 
the date on which the Principal ceases to be in a captive status, or
    (ii) If the educational or training institution is not operated on a 
semester or quarter system, the earlier of the end of any course which 
began before such date or the end of the sixteen-week period following 
that date.
    (c) In special circumstances and within the limitation of 
Sec. 192.44, the Secretary of State, under the criteria and procedures 
set forth in Sec. 192.43, may approve payments for education or training 
under this subsection which occurs after the date determined under 
paragraph (b) of this section.
    (d) In the event a Principal dies and the death is determined by the 
Agency Head to be incident to that individual being a captive, payments 
shall be available under this subsection for education or training of a 
spouse or child of the Principal which occurs after the date of death, 
up to the maximum that may be authorized under Sec. 192.44.
    (e) Family benefits under this subsection shall not be available for 
any spouse or child who is eligible for assistance under chapter 35 of 
title 38 U.S.C., or similar assistance under any other law.



Sec. 192.42  Applicable benefits for captives.

    (a) When authorized by the Agency Head, a Principal, following 
release from captivity, may be paid (by advancement or reimbursement) 
for expenses incurred for subsistence, tuition, fees, supplies, books 
and equipment, and other educational expenses while attending an 
educational or training institution approved in accordance with 
procedures established pursuant to chapter 35 and 36 of title 38 U.S.C. 
Payments shall be available under this subsection for education or 
training which occurs on or before--
    (1) The end of any semester or quarter (as appropriate) which begins 
before the date which is 10 years after the day on which the Principal 
ceases to be in a captive status, or
    (2) If the educational or training institution is not operated on a 
semester or quarter system, the earlier of the end of any course which 
began before such date or the end of the sixteen-week period following 
that date.

[[Page 604]]

    (b) A person eligible for benefits under this subsection shall not 
be required to separate from Government service in order to undertake 
the training or education. However, no educational assistance allowance 
shall be paid to any eligible person who is attending a course of 
education or training paid for under the Government Employees' Training 
Act and whose full salary is being paid to such person while so 
training.



Sec. 192.43  Administration of benefits.

    (a) Any person desiring benefits under this part, shall apply in 
writing to the Director General of the Foreign Service, Department of 
State, Washington, DC 20502. The application shall specify the benefits 
desired and the basis of eligibility for those benefits. The Director 
General of the Foreign Service, on behalf of the Secretary of State, 
shall make determinations of eligibility for benefits under this part, 
and shall forward certified applications to the Department of Veterans' 
Affairs and advise the applicant of the name and address of the office 
in the Department of Veterans' Affairs that will counsel the eligible 
persons on how to obtain the benefits that have been approved. Persons 
whose applications are disapproved shall be advised in writing of the 
reason for the disapproval. Applications for foreign service nationals 
and their dependents shall be made with the Office of Foreign Service 
National Personnel, Department of State. That office will handle the 
administrative details and benefits using the criteria specified in this 
subchapter.
    (b) The Department of Veterans' Affairs shall provide the same level 
and kind of assistance, including payments (by advancement or 
reimbursement) for authorized expenses up to the same maximum amounts, 
to spouses and children of captives, and to Principals following their 
release from captivity as it does to eligible spouses and children of 
veterans and to eligible veterans, respectively, under chapters 35 and 
36 of title 38 U.S.C. The Department of Veterans' Affairs shall, under 
procedures it has established to administer section 1724 of title 38, 
U.S.C., discontinue assistance for any individual whose conduct or 
progress is unsatisfactory under standards consistent with those 
established pursuant to such section 1724.
    (c) An Advisory Board shall be established to advise on eligibility 
for benefits under paragraphs (c) and (d) of Sec. 192.41. The Board 
shall be composed of the Under Secretary of State for Management as 
Chair, the Director of the Office of Medical Services of the Department 
of State, the Executive Director of the regional bureau of the 
Department of State in whose region the relevant hostile action 
occurred, the Director of Personnel or other designee of the applicable 
employing agency, and a representative of the Department of Veterans' 
Affairs designated by the Secretary.
    (d) If an application is received from a spouse or child for 
extended training under Sec. 192.41(c), the Director General of the 
Foreign Service of the Department of State shall determine with the 
advice of the Advisory Board whether the Principal, following release 
from captivity, is incapacitated by the captive experience--
    (1) To the extent that he or she has not returned to full-time 
active duty and is unlikely to be able to resume the normal duties of 
his or her position or career, or
    (2) In the event of a separation from Government service, that the 
Principal is unable to assume a comparable position or career, for at 
least six months from the date of release from captivity. If the 
Secretary makes such a determination, he or she may approve, within the 
limits of Sec. 192.44, an application under Sec. 192.41(c) for up to one 
year of education or training. If the Principal remains incapacitated, 
the Secretary may approve additional training or education up to the 
maximum authorized under 192.44.



Sec. 192.44  Maximum limitation on benefits.

    (a) In no event may assistance be provided under this subpart for 
any individual for a period in excess of 45 months, or the equivalent 
thereof in part-time education or training.
    (b) The eligibility of a spouse for benefits under paragraph (c) or 
(d) of Sec. 192.41 shall expire on a date which is 10 years after the 
date of the release of

[[Page 605]]

the captive or the death of the captive while in captivity, 
respectively. The eligibility of a dependent child for benefits under 
Sec. 192.41 (c) and (d) shall expire on the 21st birthday of such child.



             Subpart F--Compensation for Disability or Death



Sec. 192.50  Eligibility for benefits.

    (a) (1) The Federal Employees' Compensation Act (5 U.S.C. 8101 et 
seq.) provides for medical coverage and the payment of compensation for 
wage loss and for permanent impairment of specified members and 
functions of the body incurred by employees as a result of an injury 
sustained while in the performance of their duties to the United States. 
The Office of Workers' Compensation Programs (OWCP), Department of 
Labor, administers the program. All individuals employed by the U.S. 
Government as defined by 5 U.S.C. 8101(1) are eligible to apply for 
wage-loss and medical benefits under the FECA. Family members of such 
employees may apply for death benefits. An application must be made with 
OWCP by such individual or on behalf of such individuals, prior to the 
determination of eligibility or payment of any benefits under this 
subpart.
    (2) In the case of foreign service national employees covered for 
work related injury or death under the local compensation plan 
established pursuant to 22 U.S.C. 3968, such applications should be 
filed with the organizational authority in the country of employment 
which provides such coverage. Benefit levels payable to foreign service 
national employees under this subpart shall be no less than comparable 
benefits payable to U.S. citizen employees under FECA. Eligibility 
determination and payment of supplemental benefits, if any, is the 
responsibility of the Director General of the Foreign Service for the 
State Department.
    (b) Any death or disability benefit payment made under this section 
shall be reduced by the amount of any other death or disability benefits 
funded in whole or in part by the United States, except that the amount 
shall not be reduced below zero. The cash payment under Sec. 192.11(b) 
of subpart B is excluded from the offset requirement.
    (c) Compensation under this section may include payment (whether 
advancement or reimbursement) for any medical or health expenses 
relating to the death or disability involved to the extent that such 
expenses are not covered under subpart D of these regulations. 
Procedures of subpart D of these regulations shall apply in making such 
determinations.



Sec. 192.51  Death benefit.

    (a) The Secretary of State or Agency Head may provide for payment, 
by the employing agency, of a death benefit to the surviving dependents 
of any eligible individual under Sec. 192.1(a) who dies as a result of 
injuries caused by hostile action whose death was the result of the 
individual's relationship with the Government.
    (b) The death benefit payment for an employee shall be equal to one 
year's salary at the time of death. Such death benefit is subject to the 
offset provisions under Sec. 192.50(b) including the Federal Employees' 
Compensation Act. The death benefit for an employee's spouse and other 
eligible individuals under Sec. 192.1(b) of subpart A shall be equal to 
one year's salary of the principal at the time of death.
    (c) A death benefit payment for an adult under this section shall be 
made as follows:
    (1) First, to the widow or widower.
    (2) Second, to the dependent child, or children in equal shares, if 
there is no widow or widower.
    (3) Third, to the dependent parent, or dependent parents in equal 
shares, if there is no widow, widower, or dependent child.
    (4) Fourth, to adult, non-dependent children in equal shares.

If there is no survivor entitled to payment under this paragraph (c), no 
payment shall be made.

    (d) A death benefit payment for a child under this section shall be 
made as follows: To the surviving parents or legal guardian. If there 
are no surviving parents or legal guardian, no payment shall be made.
    (e) As used in this section--each of the terms ``widow'', 
``widower'', and ``parent'' shall have the same meaning given such term 
by section 8101 of title

[[Page 606]]

5, U.S.C.; ``child'' has the meaning given in Sec. 192.3(b)(2).



Sec. 192.52  Disability benefits.

    (a) Principals who qualify for benefits under Sec. 192.1 and are 
employees of the U.S. Government are considered for disability payments 
under programs administered by the Office of Workers' Compensation 
Programs (OWCP), Department of Labor, or in the case of foreign service 
national employees, the programs may be administered by either OWCP or 
the organizational authority in the country of employment which provides 
similar coverage under the local compensation plan established pursuant 
to 22 U.S.C. 3968. Normal filing procedures as specified by either OWCP 
or the local organizational authority which provides such coverage 
should be followed in determining eligibility. Duplicate benefits may 
not be received from both OWCP and the local organizational authority 
for the same claim. Additional benefits to persons qualifying for full 
FECA or similar benefits would not normally be payable under this 
subpart, except to foreign service national employees whose benefit 
levels are below comparable benefits payable to U.S. citizen employees 
under FECA. Foreign service national employees whose benefit levels are 
below comparable benefits payable to U.S. citizens under FECA may 
receive benefits under this subpart so that total benefits received are 
comparable to the benefits payable to U.S. citizen employees under FECA.
    (b) Family members who do not qualify for either OWCP benefits or 
benefits from the organizational authority in the country of employment 
which provides similar coverage, and anyone eligible under Sec. 192.1(a) 
who does not qualify for full benefits from OWCP, must file an 
application for disability benefits with the Office of Medical Services, 
Department of State, for a determination of eligibility under this 
subpart, if connected with hostile action abroad. Applications made in 
connection with hostile action in domestic situations will be directed 
to the Agency Head. Such applications for disability payments will be 
considered using the same criteria for determination as established by 
OWCP.
    (c) Family members who are determined to be disabled by the Office 
of Medical Services, or Agency Head using the OWCP criteria, are 
eligible to receive a lump-sum payment based on the following 
guidelines:
    (1) Permanent total disability rate. A lump-sum payment equal to two 
year's salary of the Principal at the time of the qualifying incident.
    (2) Temporary total disability rate. A lump-sum payment computed at 
66\2/3\ percent of the monthly pay rate of the Principal for each month 
of temporary total disability, not to exceed one year's salary of the 
Principal.
    (3) Partial disability rate. A lump-sum payment authorized in 
accordance with 5 U.S.C. 8106, equal to 66\2/3\ percent of the 
difference between the monthly pay at the time of the qualifying 
incident and the monthly wage-earning capacity of the family member 
after the beginning of the partial disability, not to exceed one year's 
salary of the Principal. For family members with no wage-earning 
history, a lump-sum payment equal to 66\2/3\ percent of the difference 
between the estimated monthly wage-earning capacity of the family member 
at the time of the qualifying incident and the monthly wage-earning 
capacity after the beginning of the partial disability, not to exceed 
one year's salary of the Principal may be authorized, using the criteria 
established by OWCP for such determination.
    (4) Special loss schedule. In addition to the temporary disability 
benefits payable in accordance with this subsection, if there is 
permanent disability involving the loss, or loss of use, of a member or 
function of the body or involving disfigurement, a lump-sum payment may 
be authorized at the rate of 25 percent of the payment authorized in 
accordance with the schedule and procedures in 5 U.S.C. 8107 and 20 CFR 
10.304. The Director General of the Foreign Service of State or the 
Agency Head, may at their discretion, authorize payments under this 
subpart in addition to payments for those organs and members of the body 
specified in 5 U.S.C. 8107 and in 20 CFR 10.304. The provisions of 20 
CFR part 10, subpart D,

[[Page 607]]

which prevent the payment of disability compensation and scheduled 
compensation simultaneously, shall not apply to these regulations.

Cash payments under this subpart are the responsibility of the employing 
agency.
[54 FR 12597, Mar. 28, 1989; 54 FR 16195, Apr. 21, 1989]



PART 193--BENEFITS FOR HOSTAGES IN IRAQ, KUWAIT, OR LEBANON--Table of Contents




Sec.
193.1  Determination of hostage status.
193.2  Definitions.
193.3  Applications.
193.4  Consideration and denial of claims: Notification of 
          determinations.

    Authority:  Section 599C, Pub. L. No. 101-513, 104 Stat. 2064, 
unless otherwise noted.

    Source:  55 FR 52838, Dec. 24, 1990, unless otherwise noted.



Sec. 193.1  Determination of hostage status.

    (a) The Secretary of State shall, upon his or her own initiative or 
upon application under Sec. 193.3, notify the appropriate federal 
authorities, in classified or unclassified form as he or she determines 
to be necessary in the best interests of the affected individuals, the 
names of persons whom he or she determines to be in a hostage status 
within the meaning of subsection 599C)(d) of Public Law No. 101-513.
    (b) In the case of Iraq and Kuwait, hostage status may be accorded 
to United States nationals, or family members of United States 
nationals,
    (1) who are or who have been in a hostage status as defined in 
paragraph (b)(2) of this section in Iraq or Kuwait at any time during 
the period beginning on August 2, 1990 and terminating on the date on 
which United States economic sanctions are lifted, and
    (2) who are being or who have been held in custody by governmental 
or military authorities of such country or who are taking or have taken 
refuge in the country in fear of being taken into such custody 
(including residing in any diplomatic mission or consular post in that 
country.)
    (c) In the case of Lebanon, hostage status may be accorded to United 
States nationals, which, for purposes of this paragraph, includes lawful 
permanent residents of the United States, who have been forcibly 
detained, held hostage, or interned for any period of time after June 1, 
1982, by any government (including the agents thereof) or group in 
Lebanon for the purpose of coercing the United States or any other 
government.
    (d) Determinations of the Secretary regarding questions of 
eligibility status under 599C of the Act shall be final, but interested 
persons may request administrative reconsideration on the basis of 
information which was not considered at the time of the original 
determination. The criteria for such determinations are those which are 
prescribed in the Act and in these regulations.
    (e) Eligibility determinations made under these regulations shall 
not be deemed to confer federal employment status for any purpose.
    (f) Eligibility for benefits shall be subject to the availability of 
funds under subsection 599C(e) of the Act.
[55 FR 52838, Dec. 24, 1990, as amended at 57 FR 3283, Jan. 29, 1992]



Sec. 193.2  Definitions.

    (a) For purposes of eligibility, the term covered family members 
shall be defined as prescribed by the Office of Personnel Management in 
accordance with 5 CFR Sec. 890.1202.
    (b) The term United States economic sanctions against Iraq means the 
exercise of authorities under the International Emergency Economic 
Powers Act by the President with respect to financial transactions with 
Iraq.
    (c) The term United States national means any individual who is a 
citizen of the United States or who, though not a citizen of the United 
States, owes permanent allegiance to the United States.
    (d) The term lawful permanent resident means any individual who has 
been lawfully accorded the privilege of residing permanently in the 
United States as an immigrant in accordance with the immigration laws, 
such status not having changed.
[55 FR 52838, Dec. 24, 1990, as amended at 57 FR 3283, Jan. 29, 1992]

[[Page 608]]



Sec. 193.3  Applications.

    (a) Individuals who claim any eligibility under section 599C of the 
Act may apply for benefits in accordance with the procedures described 
herein. Family members may submit applications on behalf of persons who 
are unable to do so by reason of their hostage status.
    (b) All applications for benefits \1\ shall be attested to by a 
declaration under penalty of perjury as prescribed in section 1746 of 
title 28 of the United States Code.
---------------------------------------------------------------------------


    \1\ Application form may be obtained from the Office of Citizens 
Consular Services, Department of State, Washington, DC 20520.
---------------------------------------------------------------------------

    (c) Applications shall contain all identifying and other data to 
support the claim, including, where appropriate, copies of relevant 
documents respecting status, salary, and health and life insurance 
coverage.
    (d) All applications shall be mailed to: Kuwait/Iraq/Lebanon Hostage 
Benefits Program, room 4817, Department of State, Washington, DC 20520-
4818.
    (e) Applications should be filed as quickly as possible, because 
benefits are available only until the funds allocated under the Act have 
been spent. When funds have been expended, the Department will publish a 
notice in the Federal Register so stating.
    (f) The Department of State may require of applicants such 
additional verification of hostage status and other pertinent 
information as it deems necessary.
[55 FR 52838, Dec. 24, 1990, as amended at 57 FR 3283, Jan. 29, 1992]



Sec. 193.4  Consideration and denial of claims: Notification of determinations.

    (a) No application under this subpart may be denied by the 
Department except upon the written concurrence of the Assistant Legal 
Adviser for Consular Affairs.
    (b) All applications shall be considered, evaluated, and/or prepared 
by the Federal Benefits Section of the Office of Overseas Citizens 
Consular Services. All federal agencies or other interested persons 
should contact the office at the address listed in Sec. 193.3(d).
    (c) The Department of State shall, where possible, notify 
individuals in writing of their eligibility for benefits under the Act, 
or ineligibility therefor, within thirty days of the Department's 
decision.
[55 FR 52838, Dec. 24, 1990, as amended at 57 FR 3283, Jan. 29, 1992]

[[Page 609]]



CHAPTER II--AGENCY FOR INTERNATIONAL DEVELOPMENT, INTERNATIONAL DEVELOPMENT COOPERATION AGENCY




  --------------------------------------------------------------------

Part                                                                Page
200             Employee responsibilities and conduct.......         611
201             Rules and procedures applicable to commodity 
                    transactions financed by USAID..........         611
202             Overseas shipments of supplies by voluntary 
                    nonprofit relief agencies...............         648
203             Registration of agencies for voluntary 
                    foreign aid.............................         652
204             Housing guaranty standard terms and 
                    conditions..............................         656
205             Payments to and on behalf of participants in 
                    nonmilitary economic development 
                    training programs.......................         661
206             Testimony by employees and the production of 
                    documents in proceedings where A.I.D. is 
                    not a party.............................         661
207             Indemnification of employees................         663
208             Governmentwide debarment and suspension 
                    (nonprocurement) and Governmentwide 
                    requirements for drug-free workplace 
                    (grants)................................         664
209             Non-discrimination in federally-assisted 
                    programs of the Agency for International 
                    Development--effectuation of Title VI of 
                    the Civil Rights Act of 1964............         682
211             Transfer of food commodities for food use in 
                    disaster relief, economic development 
                    and other assistance....................         691
212             Public information..........................         718
213             Collection of claims........................         728
214             Advisory committee management...............         736
215             Regulations for implementation of Privacy 
                    Act of 1974.............................         743
216             Environmental procedures....................         751

[[Page 610]]

217             Nondiscriminating on the basis of handicap 
                    in programs and activities receiving 
                    Federal financial assistance............         765
218             Nondiscrimination on the basis of age in 
                    programs or activities receiving Federal 
                    financial assistance....................         777
219             Enforcement of nondiscrimination on the 
                    basis of handicap in programs or 
                    activities conducted by International 
                    Development Cooperation Agency, Agency 
                    for International Development...........         781
221             Israel loan guarantee standard terms and 
                    conditions..............................         787
223             Administrative enforcement procedures of 
                    post-employment restrictions............         790
224             Implementation of the program fraud civil 
                    remedies act............................         792
225             Protection of human subjects................         807
226             Administration of assistance awards to U.S. 
                    non-governmental organizations..........         818
227             New restrictions on lobbying................         845
228             Rules on source, origin and nationality for 
                    commodities and services financed by 
                    USAID...................................         857

[[Page 611]]



PART 200--EMPLOYEE RESPONSIBILITIES AND CONDUCT--Table of Contents




    Cross-References: The regulations governing the responsibilities and 
conduct of employees of the Agency for International Development are 
codified as part 10 of this title, prescribed jointly by the Department 
of State, the Agency for International Development, and the U.S. 
Information Agency, 31 FR 6309, Apr. 26, 1966.



PART 201--RULES AND PROCEDURES APPLICABLE TO COMMODITY TRANSACTIONS FINANCED BY USAID--Table of Contents




              Subpart A--Definitions and Scope of This Part

Sec.
201.01  Definitions.
201.02  Scope and application.
201.03  OMB approval under the Paperwork Reduction Act.

     Subpart B--Conditions Governing the Eligibility of Procurement 
                    Transactions for USAID Financing

201.10  Purpose.
201.11  Eligibility of commodities.
201.12  Eligibility of incidental services.
201.13  Eligibility of delivery services.
201.14  Eligibility of bid and performance bonds and guaranties.
201.15  U.S. flag vessel shipping requirement.

    Subpart C--Procurement Procedures; Responsibilities of Importers

201.20  Purpose.
201.21  Notice to supplier.
201.22  Procurement under public sector procedures.
201.23  Procurement under private sector procedures.
201.24  Progress and advance payments.
201.25  Bid and performance bonds and guaranties.
201.26  Expenditure of marine insurance loss payments.

                Subpart D--Responsibilities of Suppliers

201.30  Purpose.
201.31  Suppliers of commodities.
201.32  Suppliers of delivery services.

Subpart E--General Provisions Relating to USAID Financing of Commodities 
                     and Commodity-Related Services

201.40  Purpose.
201.41  Audit and inspection.
201.42  Reexport of USAID-financed commodities.
201.43  Diversion clause.
201.44  Vesting in USAID of title to commodities.
201.45  Termination or modification of a loan, grant or implementing 
          document.
201.46  Compensation to supplier if shipment is prohibited.
201.47  Use of marine insurance loss proceeds.

                  Subpart F--Payment and Reimbursement

201.50  Purpose.
201.51  Methods of financing.
201.52  Required documents.
201.53  Final date for presentation of documents.

                       Subpart G--Price Provisions

201.60  Purpose and applicability of this subpart.
201.61  Meaning of terms in this subpart.
201.62  Responsibilities of borrower/grantee and of supplier.
201.63  Maximum prices for commodities.
201.64  Application of the price rules to commodities.
201.65  Commissions, discounts and other payments, credits, benefits and 
          allowances.
201.66  Side payments.
201.67  Maximum freight charges.
201.68  Maximum prices for commodity-related services.
201.69  Cooperating country taxes and fees.

             Subpart H--Rights and Responsibilities of Banks

201.70  Purpose.
201.71  Terms of letters of credit.
201.72  Making payments.
201.73  Limitations on the responsibilities of banks.
201.74  Additional documents for USAID.
201.75  Termination or modification.

      Subpart I--Rights and Remedies of USAID, and Waiver Authority

201.80  Purpose.
201.81  Rights of USAID against borrower/grantees.
201.82  Rights of USAID against suppliers.
201.83  No waiver of alternative rights or remedies by USAID.
201.84  Limitation on period for making refund requests.
201.85  Legal effect of USAID approvals and decisions.
201.86  Waiver and amendment authority.

Appendix A to Part 201--Supplier's Certificate and Agreement With the 
          Agency for International Development

[[Page 612]]

          (AID 282)
Appendix B to Part 201--Application for Approval of Commodity 
          Eligibility (AID 11)

    Authority:  22 U.S.C. 2381.

    Source:  55 FR 34232, Aug. 22, 1990, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 201 appear at 62 FR 
38027, July 16, 1997.



              Subpart A--Definitions and Scope of This Part



Sec. 201.01  Definitions.

    As used in this part, the following terms shall have the meanings 
indicated below:
    (a) The Act means the Foreign Assistance Act of 1961, as amended 
from time to time.
    (b) USAID means the U.S. Agency for International Development or any 
successor agency, including when applicable, each USAID Mission abroad.
    (c) USAID Geographic Code means a code in the USAID Geographic Code 
Book which designates a country, a group of countries, or an otherwise 
defined area. Principal USAID geographic codes are described in 
Sec. 201.11(b)(4) of this part.
    (d) USAID/W means the USAID in Washington, DC 20523, including any 
office thereof.
    (e) Approved applicant means the individual or organization 
designated by the borrower/grantee to establish credits with banks in 
favor of suppliers or to instruct banks to make payments to suppliers, 
and includes any agent acting on behalf of such approved applicant.
    (f) Bank means a banking institution organized under the laws of the 
United States, or any State, commonwealth, territory, or possession 
thereof, or the District of Columbia.
    (g) Borrower/grantee means the government of any cooperating 
country, or any agency, instrumentality or political subdivision 
thereof, or any private entity, to which USAID directly makes funds 
available by loan or grant.
    (h) Commission means any payment or allowance made or agreed to be 
made by a supplier to any person for the contribution which that person 
has made to securing the sale for the supplier or which the person makes 
to securing similar sales on a continuing basis for the supplier.
    (i) Commodity means any material, article, supply, goods, or 
equipment.
    (j) Commodity Approval Application means the Application for 
Approval of Commodity Eligibility (Form AID 11) which appears as 
appendix B to this part 201.
    (k) Commodity-related services means delivery services and/or 
incidental services.
    (l) Cooperating country means the country receiving the USAID 
assistance subject to provisions of this part 201.
    (m) Delivery means the transfer to, or for the account of, an 
importer of the right to possession of a commodity, or, with respect to 
a commodity-related service, the rendering to, or for the account of, an 
importer of any such service.
    (n) Delivery service means any service customarily performed in a 
commercial export transaction which is necessary to effect a physical 
transfer of commodities to the cooperating country. Examples of such 
services are the following: export packing, local drayage in the source 
country (including waiting time at the dock), ocean and other freight, 
loading, heavy lift, wharfage, tollage, switching, dumping and trimming, 
lighterage, insurance, commodity inspection services, and services of a 
freight forwarder. Delivery services may also include work and materials 
necessary to meet USAID marking requirements.
    (o) Implementing document means any document, including a letter of 
commitment, issued by USAID which authorizes the use of USAID funds for 
the procurement of commodities and/or commodity related services and 
which specifies conditions which will apply to such procurement.
    (p) Importer means any person or organization, governmental or 
otherwise, in the cooperating country who is authorized by the borrower/
grantee to use USAID funds under this Regulation for the procurement of 
commodities, and includes any borrower/grantee who undertakes such 
procurement.

[[Page 613]]

    (q) Incidental services means the installation or erection of USAID-
financed equipment, or the training of personnel in the maintenance, 
operation and use of such equipment.
    (r) Mission means the USAID Mission or representative in a 
cooperating country.
    (s) Non-vessel-operating common carrier (NVOCC) under Section 3(17) 
of the Shipping Act of 1984 means a common carrier pursuant to Section 
3(6) of such Act that does not operate any of the vessels by which the 
ocean transportation is provided, and is a shipper in its relationship 
with an ocean carrier.
    (t) Purchase contract means any contract or similar arrangement 
under which a supplier furnishes commodities and/or commodity-related 
services financed under this part.
    (u) Responsible bidder is one who has the technical expertise, 
management capability, workload capacity, and financial resources to 
perform the work successfully.
    (v) Responsive bid is a bid that complies with all the terms and 
conditions of the invitation for bids without material modification. A 
material modification is a modification which affects the price, 
quantity, quality, delivery or installation date of the commodity or 
which limits in any way responsibilities, duties, or liabilities of the 
bidder or any rights of the importer or USAID as any of the foregoing 
have been specified or defined in the invitation for bids.
    (w) Schedule B means the ``Schedule B, Statistical Classification of 
Domestic and Foreign Commodities Exported from the United States'' 
issued and amended from time to time by the U.S. Bureau of the Census, 
Department of Commerce and available as stated in 15 CFR 30.92.
    (x) Source means the country from which a commodity is shipped to 
the cooperating country, or the cooperating country if the commodity is 
located therein at the time of the purchase. Where, however, a commodity 
is shipped from a free port or bonded warehouse in the form in which 
received therein, source means the country from which the commodity was 
shipped to the free port or bonded warehouse.
    (y) State means the District of Columbia or any State, commonwealth, 
territory or possession of the United States.
    (z) Supplier means any person or organization, governmental or 
otherwise, who furnishes commodities and/or commodity-related services 
financed under this part 201.
    (aa) Supplier's Certificate means Form AID 282 ``Supplier's 
Certificate and Agreement with the Agency for International 
Development,'' including the ``Invoice and Contract Abstract'' on the 
reverse of such form (which appears as appendix A to this part 201), or 
any substitute form which may be prescribed in the letter of commitment 
or other pertinent implementing document.
    (bb) United States means the United States of America, any State(s) 
of the United States, the District of Columbia, and areas of U.S. 
associated sovereignty, including commonwealths, territories and 
possessions.
    (cc) Vessel operating common carrier (VOCC) means an ocean common 
carrier pursuant to section 3(18) of the Shipping Act of 1984 which 
operates the vessel by which ocean transportation is provided.



Sec. 201.02  Scope and application.

    (a) The appropriate implementing documents will indicate whether and 
the extent to which this part 201 shall apply to the procurement of 
commodities or commodity-related services or both. Whenever this part 
201 is applicable, those terms and conditions of this part will govern 
which are in effect on the date of issuance of the direct letter of 
commitment to the supplier; if a bank letter of commitment is 
applicable, the terms and conditions govern which are in effect on the 
date of issuance of an irrevocable letter of credit under which payment 
is made or is to be made from funds made available under the Act, or, if 
no such letter of credit has been issued, on the date payment 
instructions for payment from funds made available under the Act are 
received by the paying bank.
    (b) The borrower/grantee is responsible for compliance with the 
applicable provisions of this part by importers

[[Page 614]]

and suppliers and for assuring that importers and suppliers are informed 
of the extent to which this part applies.
    (c) Unless otherwise indicated, references in this part 201 to 
subparts or to sections relate to subparts or sections of this part 201.



Sec. 201.03  OMB approval under the Paperwork Reduction Act.

    The following information collection and recordkeeping requirements 
established by this part 201 have been approved by OMB (OMB Control No. 
0412-0514 expiring April 30, 1991):

    Sec.
    201.13 (b)(1)
    201.13 (b)(2)
    201.15(c)
    201.31(g)
    201.32(b)
    201.32(c)
    201.51(c)
    201.52(a)
    201.74


The information requested will be used to verify compliance with 
statutory and regulatory requirements and to assist in the 
administration of USAID-financed commodity programs. The submission of 
the information is required in order to receive payment for commodities 
or commodity-related services. The public reporting burden for this 
collection of information is estimated to average 30 minutes per 
response, including the time for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing the collection of information. Send comments 
regarding this burden estimate or any other aspect of this collection of 
information, including suggestions for reducing this burden, to: Office 
of Procurement Planning, Policy and Evaluation (MS/PPE), Agency for 
International Development, Washington, DC 20523-1435; and Office of 
Management and Budget, Paperwork Reduction Project (0412-0514), 
Washington, DC 20503.



     Subpart B--Conditions Governing the Eligibility of Procurement 
                    Transactions for USAID Financing



Sec. 201.10  Purpose.

    This subpart sets forth requirements for USAID financing applicable 
to transactions for the procurement of commodities and/or commodity-
related services.



Sec. 201.11  Eligibility of commodities.

    To qualify for USAID financing, a commodity procurement transaction 
shall satisfy the following requirements:
    (a) Description and condition of the commodity. The commodity shall 
conform to the description in the implementing document. Unless 
otherwise authorized by USAID/W in writing, the commodity shall be 
unused, and may not have been disposed of as surplus by any governmental 
agency.
    (b) Source. The authorized source for procurement shall be a country 
or countries authorized in the implementing document by name or by 
reference to a USAID geographic code. The source and origin of a 
commodity must be an authorized source country. The applicable rules on 
source, origin and nationality for commodities and commodity-related 
services are in subparts (B), (C), and (F) of part 228 of this chapter.
    (c) Date of shipping documents. The documents required as evidence 
of shipment under Sec. 201.52(a)(4) shall show that the date of shipment 
was within the shipping period, if any, specified in the implementing 
document.
    (d) Medium of transportation. Shipment shall not be effected:
    (1) By a transportation medium owned, operated or under the control 
of any country not included within USAID Geographic Code 935; or
    (2) Under any ocean or air charter which has not received prior 
approval by USAID/W, Office of Procurement (Transportation Division).

[[Page 615]]

    (e) Marine insurance. In accordance with the provisions of 
Sec. 228.23 of this chapter, USAID may require that any USAID-financed 
commodity shipped to the cooperating country shall be insured against 
marine risks and that such insurance shall be placed in the United 
States with a company or companies authorized to do marine insurance 
business in a State of the United States.
    (f) Timely submission of documents. All documents required under 
Sec. 201.52 to be submitted by a supplier in order to receive payment or 
reimbursement shall be submitted to USAID under direct letters of 
commitment or to a designated bank under bank letters of credit on or 
before the terminal date specified in the letter of commitment or letter 
of credit, respectively.
    (g) U.S. Treasury Department regulations. Procurement transactions 
shall comply with the requirements of the U.S. Treasury Department 
Foreign Assets, Sanctions, Transactions and Funds Control Regulations 
published in 31 CFR parts 500 through 599, as from time to time amended.
    (h) Commodities shipped out of a free port or bonded warehouse. No 
commodity shipped out of a free port or bonded warehouse is eligible for 
USAID financing if it was shipped to the free port or bonded warehouse 
without compliance with the requirements set forth in paragraph (d)(1) 
of this section, or if it was shipped from the free port or bonded 
warehouse without compliance with the requirements set forth in 
paragraphs (d) (1) and (2) of this section.
    (i) Purchase price. The purchase price for the commodity shall 
satisfy the requirements of subpart G.
    (j) Purchases from eligible suppliers. Commodities procured with 
funds made available under this part 201 shall be purchased from 
eligible suppliers. The rules on the nationality of suppliers of 
commodities are in section 228.14 of this chapter.
    (k) Determination of commodity eligibility. The commodity shall be 
approved in writing by USAID for each purchase transaction as eligible 
for USAID financing. Such approval shall be indicated on the Application 
for Approval of Commodity Eligibility (Form AID 11) submitted to USAID 
by the supplier.
[55 FR 34232, Aug. 22, 1990, as amended at 58 FR 48797, Sept. 20, 1993; 
62 FR 38027, July 16, 1997]



Sec. 201.12  Eligibility of incidental services.

    Incidental services may be financed under the same implementing 
document which makes funds available for the procurement of equipment 
only if:
    (a) Such services are specified in the purchase contract relating to 
the equipment;
    (b) The price satisfies the requirements of Sec. 201.68;
    (c) The portion of the total purchase contract price attributable to 
such services does not exceed 25 percent; and
    (d) The supplier of such services, prior to approval of the USAID 
Commodity Approval Application, has neither been suspended or debarred 
by USAID under part 208 of this chapter, nor has been placed on the 
``Lists of Parties Excluded from Federal Procurement or Nonprocurement 
Programs,'' published by the U.S. General Services Administration.
    (e) The supplier of such services meets the requirements of 
Sec. 228.25 of this chapter.
[55 FR 34232, Aug. 22, 1990, as amended at 62 FR 38027, July 16, 1997]



Sec. 201.13  Eligibility of delivery services.

    (a) General. Delivery of USAID-financed commodities may be financed 
under the implementing document provided the delivery services meet the 
requirements of this section and the applicable provisions in part 228, 
subpart C of this chapter.
    (b) Transportation costs. USAID will not finance transportation 
costs:
    (1) For shipment beyond the point of entry in the cooperating 
country except when intermodal transportation service covering the 
carriage of cargo from point of origin to destination is used, and the 
point of destination, as stated in the carrier's through bill of lading, 
is established in the carrier's tariff; or
    (2) On a transportation medium owned, operated or under the control 
of any country not included in Geographic Code 935; or

[[Page 616]]

    (3) Under any ocean or air charter covering full or part cargo 
(whether for a single voyage, consecutive voyages, or a time period) 
which has not received prior approval by USAID/W, Office of Procurement, 
Transportation Division); or
    (4) Which are attributable to brokerage commissions which exceed the 
limitations specified in Sec. 201.65(h) or to address commissions, dead 
freight, demurrage or detention.
    (c) Inspection services. USAID will finance inspection of USAID-
financed commodities when inspection is required by USAID, or in those 
cases where inspection is required by the importer and such inspection 
is specified in the purchase contract, performed by independent 
inspectors and is either customary in export transactions for the 
commodity involved or is necessary to determine conformity of the 
commodities to the contract. Section 228.24 of this chapter covers the 
nationality requirements for suppliers of inspection services.
    (d) Marine insurance. (1) Unless otherwise authorized, USAID will 
finance premiums for marine insurance including war risk on USAID-
financed commodities only if:
    (i) The insurance is placed in a country included in the authorized 
Geographic Code: Provided, that if the authorized Geographic Code is any 
other than USAID Geographic Code 000, the cooperating country itself 
shall be recognized as an eligible source; and
    (ii) Such insurance is placed either in accordance with the terms of 
the commodity purchase contract or on the written instructions of the 
importer; and
    (iii) Insurance coverage relates only to the period during which the 
commodities are in transit to the cooperating country, except that it 
may include coverage under a warehouse-to-warehouse clause; and
    (iv) The premiums do not exceed the limitations contained in 
Sec. 201.68; and
    (v) The insurance provides that loss payment proceeds shall be paid 
in U.S. dollars or other freely convertible currency.
    (2) Within the meaning of Sec. 201.11(e), as well as this paragraph, 
insurance is placed in a country only if payment of the insurance 
premium is made to, and the insurance policy is issued by, an insurance 
company office located in that country.
    (e) Suspension and debarment. In order to be eligible for USAID 
financing, the costs of any delivery services must be paid to carriers, 
insurers, or suppliers of inspection services who, prior to approval of 
the USAID Commodity Approval Application, have neither been suspended 
nor debarred under USAID Regulation 8, 22 CFR part 208, nor included on 
the ``Lists of Parties Excluded from Federal Procurement or 
Nonprocurement Programs'' published by the U.S. General Services 
Administration.
[55 FR 34232, Aug. 22, 1990, as amended at 62 FR 38027, July 16, 1997]



Sec. 201.14  Eligibility of bid and performance bonds and guaranties.

    The cost of any bid bond or guaranty posted by a successful bidder 
or of any performance bond or guaranty posted by a supplier is eligible 
for financing under the implementing document, provided that the bond or 
guaranty conforms to the requirements of the invitation for bids or the 
contract, as applicable, and to the extent that the principal amount of 
the bond or guaranty does not exceed the amount customary in 
international trade for the type of transaction and commodity involved. 
Bonds or guaranties may be payable in U.S. dollars, or a freely 
convertible currency or local currency, and shall be posted in favor of 
the purchaser. Nationality requirements for sureties, insurance 
companies or banks who issue bonds or guaranties under USAID-financed 
transactions are set forth in Sec. 228.38(b) of this chapter.
[55 FR 34232, Aug. 22, 1990, as amended at 62 FR 38027, July 16, 1997]



Sec. 201.15  U.S. flag vessel shipping requirements.

    (a) General requirements. Unless USAID determines that privately 
owned U.S. flag commercial ocean vessels are not available at fair and 
reasonable rates for such vessels:
    (1) At least fifty percent (50%) of the gross tonnage (computed 
separately for dry bulk carriers, dry cargo liners, and tankers from 
each of two geographic

[[Page 617]]

areas--the U.S. and all other countries) of all goods financed by USAID 
which are transported on ocean vessels shall be transported on privately 
owned U.S. flag commercial vessels; and
    (2) At least fifty percent (50%) of the gross freight revenue 
generated by all shipments of USAID-financed commodities which are 
transported to the territory of the borrower/grantee on dry cargo liners 
shall be paid to or for the benefit of privately owned U.S. flag 
commercial vessels.
    (b) Methods of compliance. (1) Compliance with these requirements 
with respect to dry cargo liner vessels shall be achieved for the total 
of liner shipments made during the term of the loan or grant agreement. 
If USAID determines at any time during the term of the agreement that 
compliance may not be achieved, USAID may require that all subsequent 
shipments be made on U.S. flag liners until compliance is assured.
    (2) Compliance with these requirements with respect to dry bulk 
carriers and tankers shall be achieved for each quantitative unit of 
cargo. A quantitative unit of cargo is the total tonnage of a commodity 
or commodities included in one invitation for bids or other solicitation 
of offers from ocean carriers for the transportation of cargo which may 
move in full shipload lots. USAID shall approve a charter or other 
contract of affreightment for a non-U.S. flag vessel only if USAID has 
determined that at least 50% of the quantitative unit will move on U.S. 
flag vessels, to the extent that such vessels are available at fair and 
reasonable rates for such vessels. U.S. flag dry cargo liners whose 
offers are responsive to the terms of the invitation for bids or other 
solicitation of vessels may be used for achieving compliance for the 
quantitative unit.
    (c) Nonavailability of U.S. flag vessels. Upon application of the 
borrower/grantee or the supplier, USAID/W, Office of Procurement, 
Transportation Division, shall determine and advise the applicant 
whether or not privately owned U.S. flag vessels are available for any 
specific shipment of commodities at fair and reasonable rates. A 
determination that U.S. flag vessels are not available does not carry 
with it the authorization for USAID to finance freight on a vessel not 
otherwise authorized; this requires a separate waiver approval in 
accordance with Sec. 201.13(b)(1)(ii).
    (d) Responsibility. The borrower/grantee is responsible for 
compliance with the requirements of this section and for imposing upon 
subborrowers, contractors and importers such requirements regarding 
shipping arrangements with suppliers as will assure discharge of this 
responsibility.
    (e) Privately owned U.S. flag commercial vessels. For purposes of 
this section the term ``privately owned U.S. flag commercial vessels'' 
shall not include any vessel which, subsequent to September 21, 1961, 
shall have been either built outside the U.S., rebuilt outside the U.S. 
or documented under any foreign registry until such vessel shall have 
been documented under the laws of the U.S. for a period of 3 years.



    Subpart C--Procurement Procedures; Responsibilities of Importers



Sec. 201.20  Purpose.

    This subpart prescribes procurement procedures which shall apply to 
an importer whenever a commodity procurement is to be financed by USAID 
subject to this part 201.



Sec. 201.21  Notice to supplier.

    The importer is responsible for providing the supplier with the 
following information (either through the invitation for bids, the 
request for quotations or otherwise):
    (a) Notice that the transaction is to be financed by USAID under 
this part 201;
    (b) The identification number of the implementing document;
    (c) All additional information prerequisite to USAID financing and 
contained in the instructions from the borrower/grantee to the importer 
(for example, eligible source of commodity, periods during which 
deliveries must be made, shipping provisions, and documentation 
requirements); and, where appropriate,
    (d) Notice of the marking requirements in Sec. 201.31(d), when the 
importer is the government of the cooperating

[[Page 618]]

country or any if its subdivisions or instrumentalities.



Sec. 201.22  Procurement under public sector procedures.

    (a) General requirements. When the importer is the government of the 
cooperating country or any of its subdivisions, agencies or 
instrumentalities, all purchase contracts for commodities shall be 
awarded under public sector procedures in this section unless otherwise 
authorized by USAID. Such contracts shall be awarded on a competitive 
basis unless otherwise authorized by USAID under paragraph (g) of this 
section.
    (b) Formal competitive bidding. Formal competitive bidding 
procedures shall be used for all procurements estimated to exceed 
$100,000 or the equivalent, exclusive of ocean or air transportation 
costs, except when other procedures are authorized in accordance with 
this section. Formal competitive bidding procedures may also be used for 
procurements under $100,000 at the option of the importer. Formal 
competitive bidding procedures include advertising the availability of 
an invitation for bids in accordance with paragraph (h) of this section, 
issuance of the invitation for bids, public opening of sealed bids, 
evaluation of bids, and award of the contract, except as provided in 
Sec. 201.22(b)(3), to the lowest responsive bid by a responsible bidder.
    (1) Contents of the invitation for bids. The invitation for bids and 
every attachment and amendment thereto shall be in the English language 
and shall be available to prospective suppliers free of charge unless 
otherwise authorized by USAID. The following minimum requirements are 
applicable:
    (i) Statement of requirements. The invitation for bids shall state 
specifically that the formal competitive bidding procedures set forth in 
this Sec. 201.22 apply. The terms and conditions of the procurement 
shall be clearly indicated, including any factors other than price to be 
used in the evaluation. Commodity specifications shall be stated in a 
non-restrictive manner and in sufficient detail to permit maximum 
response from prospective suppliers. The metric system of measurements 
shall be used for specifications unless USAID determines in writing that 
such use is impractical or is likely to cause significant inefficiencies 
or the loss of markets to U.S. firms.
    (ii) Statement regarding submission of bids. The invitation for bids 
shall be appropriately numbered and state the complete physical address, 
as well as any post office box number, to which bids or offers are to be 
sent, the closing hour and date for submission and the date, hour and 
place of the public opening of the bids. If additional drawings, 
details, regulations or forms are necessary for submitting a bid, the 
invitation shall state where such material may be obtained.
    (iii) Statement regarding this part 201. The invitation for bids 
shall expressly indicate the extent to which any resulting contract is 
subject to the requirements of this part 201.
    (iv) Statement regarding late bids. The invitation for bids shall 
state that no bid received at the address designated in the invitation 
after the closing hour and date for submission will be considered for 
award unless its late arrival at that address is attributable solely to 
mishandling of the bid documents by the importer or any of its agents 
directly associated with receiving or processing the bids. In no case 
will the importer consider a bid which was not received at the place of 
public opening before the award was made.
    (2) Handling bids. Bids received shall be held intact and sealed and 
shall be safeguarded against disclosure of contents prior to bid 
opening. The bids shall be opened publicly as specified in the bid 
invitation, and all properly submitted bids shall be considered. Direct 
submission of a bid by a prospective supplier, rather than through an 
agent or other representative of the supplier in the cooperating 
country, shall not be cause for rejection.
    (3) Awards. Every award shall be made to that responsible bidder 
whose responsive bid is lowest in price. If any factor other than price 
is used in evaluating bids, each such factor shall be computed in 
accordance with the formula in the invitation for bids.
    (c) Two-stage formal competitive bidding. Subject to the approval of 
USAID, two-stage formal competitive bidding

[[Page 619]]

may be used in the procurement of specialized equipment, where 
requirements are stated in performance-type specifications. Two-stage 
bidding involves a request for technical proposals for the equipment 
being purchased, submission of proposals without price information, 
discussions with the offerors as necessary to clarify proposals, 
followed by a request for priced bids for those proposals found to be 
fully acceptable following discussions between the offerors and the 
purchaser. The priced bids shall be publicly opened. Handling and award 
of the bids shall comply with paragraphs (b) (2) and (3) of this 
section.
    (d) Competitive negotiation procedures. (1) If approved by USAID 
based on a written record of the reasons therefor, a competitive 
negotiation procedure may be used. Competitive negotiation procedures 
include advertising the availability of a request for quotations in 
accordance with paragraph (h) of this section, issuance of the request 
for quotations, receipt and evaluation of offers, negotiation (when 
appropriate), and award of the contract to the offeror submitting the 
most advantageous offer, price and other factors considered. Competitive 
negotiation procedures may be approved in the following circumstances:
    (i) When it is impossible to develop adequate commodity 
specifications for use in an invitation for bids;
    (ii) When price alone would not be an effective means of determining 
an award (i.e., when criteria, such as time of delivery or service 
capability need to be evaluated);
    (iii) When emergency procurement is justified by a demonstration 
that the time required for formal competitive bid procedures would 
result in an unacceptable delay in delivering the commodities;
    (iv) When proprietary procurement is justified; or
    (v) When adherence to formal competitive procedures would impair 
program objectives.
    (2) When formal competitive bidding procedures have failed, all bids 
have been rejected, and further use of such procedures would clearly not 
be productive, the Mission Director may authorize the use of competitive 
negotiation procedures. Further advertising is not required. The request 
for quotations may be prepared as a new document or may incorporate 
appropriate provisions of the invitation for bids. It shall be submitted 
to those potential suppliers who originally submitted bids in response 
to the invitation for bids.
    (e) Small value procurement. When the estimated value of the 
contract does not exceed $100,000 or equivalent (exclusive of ocean and 
air transportation costs), the purchaser may award a contract by 
advertising the procurement in accordance with paragraph (h) of this 
section and soliciting quotations from a reasonable number of sources, 
including, where feasible, producers of the commodity, taking into 
consideration:
    (1) The nature of the commodities to be purchased;
    (2) The number of sources which can supply the commodities;
    (3) The value of the procurement; and
    (4) The administrative cost of procuring the commodities.

The contract shall be awarded to the offeror with the most advantageous 
offer, price and other factors considered.
    (f) Proprietary procurement. Purchasing by brand or trade name or by 
a restrictive specification (proprietary procurement) may be justified 
for reasons such as:
    (1) Substantial benefits, such as economies in maintenance of spare 
parts inventories, stronger local dealer organization, better repair 
facilities, or greater familiarity by operating personnel, can be 
achieved through standardizing on a particular brand;
    (2) Compatibility with equipment on hand is required; or
    (3) Special design or operational characteristics are required.

The need for proprietary procurement may serve as the basis for 
approving the use of competitive negotiation procedures in accordance 
with paragraph (d) of this section or a waiver for negotiation with a 
single source in accordance with paragraph (g) of this section.
    (g) Negotiation with a single source--(1) Circumstances. Competition 
may be waived and negotiation with a single

[[Page 620]]

source authorized by USAID under one of the following circumstances:
    (i) the purchaser can demonstrate the existence of an emergency 
situation in which the requirement for competition would result in an 
unacceptable delay in the procurement of the commodities;
    (ii) proprietary procurement is justified and the necessary 
commodities or spare parts are available from only one source, taking 
into account any special requirements such as the need for in-country 
service capability; or
    (iii) adherence to competitive procedures would result in the 
impairment of the objectives of the United States foreign assistance 
program or would not be in the best interest of the United States.
    (2) Amendments. Negotiation with a single source to amend an 
existing contract outside the scope of the contract must be justified 
under one or more of the criteria in paragraph (g)(1) of this section 
and formally approved by USAID.
    (h) Advertising--(1) Requirements. (i) For each procurement 
estimated to exceed $25,000, or equivalent (exclusive of ocean and air 
transportation costs), notice of the availability of the invitation for 
bids, request for quotations or specific information about procurements 
under $100,000 shall be published by the USAID Office of Small and 
Disadvantaged Business Utilization/Minority Resource Center in the 
appropriate USAID Bulletin. The purchaser shall submit three copies of 
each invitation for bids or request for quotations (if any) to the USAID 
Mission with its request for advertising. The Mission will forward the 
request for advertising and the procurement documents to USAID/W. The 
request for advertising should arrive in the Office of Small and 
Disadvantaged Business Utilization/Minority Resource Center at least 45 
days prior to the final date for receiving bids or quotations. The 
purchaser may, in addition, advertise in appropriate local, regional, 
and international journals, newspapers, etc., and otherwise, in 
accordance with local practice.
    (ii) Additionally, if the estimated value of the contract is more 
than $100,000, or equivalent (exclusive of ocean and air transportation 
costs), the notice of availability of the invitation for bids or request 
for quotations shall be published in the ``Commerce Business Daily'' of 
the U.S. Department of Commerce.
    (2) Exceptions. (i) When negotiation with a single source has been 
authorized, advertising is not required.
    (ii) When formal competitive bid procedures have failed to result in 
an award pursuant to paragraph (d)(2) of this section and a 
determination is made to follow competitive negotiation procedures, no 
further advertising is required.
    (iii) The requirements for advertising as set forth above may be 
waived by USAID to avoid serious procurement delays in certain 
circumstances, provided, however, that efforts shall be made to secure 
bids or offers from a reasonable number of potential suppliers.
    (i) USAID approvals. (1) Each invitation for bids or request for 
quotations for an USAID-financed procurement which is estimated to 
exceed $100,000, or equivalent (exclusive of ocean and air 
transportation costs), must be approved by USAID prior to issuance.
    (2) Each contract in excess of $100,000, or equivalent (exclusive of 
ocean and air transportation costs), must be formally approved by USAID 
prior to finalization with the supplier.
    (3) USAID may require that contracts under $100,000 be formally 
approved prior to finalization with the supplier.



Sec. 201.23  Procurement under private sector procedures.

    (a) General requirements. Procurements under private sector 
procedures will normally be carried out by importers using negotiated 
procurement procedures, unless the importer chooses to follow the 
procedures in Sec. 201.22. Procurement on a negotiated basis shall be in 
accordance with good commercial practice. Solicitations by the importer 
for quotations or offers shall be made uniformly to a reasonable number 
of prospective suppliers, including, where feasible, producers of a 
commodity, and all quotations or offers received, whether or not 
specifically solicited, shall be given consideration before making an 
award.

[[Page 621]]

    (b) Publicizing. To provide suppliers in the United States with an 
opportunity to participate in furnishing commodities which may be 
purchased on a negotiated basis under USAID financing, USAID will 
periodically publish for each cooperating country a list of commodities 
which may be expected to be imported and the names and contact 
information for the importers which have traditionally purchased those 
commodities. Interested suppliers may then make offers or furnish 
quotations on the products they desire to sell directly to the importers 
of those products. USAID will not publicize specific proposed purchases 
which are to be undertaken by private sector importers on a negotiated 
basis unless specifically requested to do so by the importer in 
accordance with the provisions of paragraph (c) of this section.
    (c) Notification. If the importer elects to solicit quotations and 
offers for specific proposed purchases through publication by USAID, 
USAID will notify prospective suppliers of the export opportunity 
through the appropriate USAID bulletin. Requests for such notification 
shall be submitted to the Office of Small and Disadvantaged Business 
Utilization/Minority Resource Center, USAID, Washington, DC 20523-1414, 
and shall contain the name and contact information for the importer, a 
full description of the commodities and any commodity related services 
required, applicable price and delivery terms and other relevant 
procurement data, in the English language. The metric system of 
measurements shall be used for specifications unless USAID determines in 
writing that such use is impractical or is likely to cause significant 
inefficiencies or the loss of markets to U.S. firms.
    (d) Notice of quotations and offers received. USAID may require that 
the importer furnish an abstract in the English language and identify 
thereon all offers or quotations received, the offer accepted or order 
placed, the price, the quantity, the name and address of all persons 
submitting offers or quotations and of their principals, if any 
(including manufacturers or processors of the commodity).
    (e) Procurement under special supplier-importer relationships--(1) 
Solicitation of offers from more than one supplier is not required if:
    (i) The importer is purchasing for resale or processing, as the 
supplier's regularly authorized distributor or dealer, a commodity 
which, under the terms of the distributorship or dealer agreement, the 
importer is precluded from buying from another supplier; or
    (ii) The importer is purchasing for resale a registered brand-name 
commodity from a supplier who is the exclusive distributor of that 
commodity to the area of the importer.
    (2) USAID may require the importer to furnish, or cause to be 
furnished, to USAID documentary evidence of the existence of the 
relationships described in paragraph (e)(1) of this section.



Sec. 201.24  Progress and advance payments.

    (a) Definitions--(1) Progress payments. Progress payments are 
payments made prior to shipment under a fixed price procurement 
contract, which are based on actual costs incurred or on an actual stage 
or percentage of completion accomplished.
    (2) Advance payments. Advance payments are payments to a supplier 
prior to, and in anticipation of, performance under a procurement 
contract. They are not based on actual performance or actual costs 
incurred.
    (b) Progress Payments--(1) Conditions for eligibility. USAID will 
approve progress payments only if:
    (i) The period between the commencement of work and the first 
required delivery will exceed four months;
    (ii) There will be substantial predelivery costs that may have a 
material impact on a suppliers's working capital;
    (iii) The total FAS purchase price will exceed $200,000;
    (iv) The supplier must establish a performance bond or guaranty in 
favor of the borrower/grantee providing adequate security for the amount 
of the progress payments; and
    (v) The amount of the progress payments does not exceed 95 percent 
of the total FAS purchase price.

[[Page 622]]

    (2) Notice. In order for progress payments to be eligible under a 
competitive procurement, the solicitation document must state that such 
payments will be allowed and that a request for progress payments will 
not be considered an adverse factor in the award of the contract.
    (3) Approval. All progress payments must be approved in writing by 
USAID.
    (c) Advance payments--(1) Conditions for eligibility. Advance 
payments may be authorized only if USAID has made a positive 
determination in writing that:
    (i) USAID will benefit therefrom, in terms of increased competition 
and/or lower prices, prior to the issuance of the solicitation or prior 
to award of a noncompetitive contract; and
    (ii) The supplier has a financial management system which is 
adequate for controlling and accounting for U.S. government funds.
    (2) Amount. The amount of the advance is based on an analysis of the 
working capital required under the procurement contract, taking into 
consideration the availability of the supplier's own working capital and 
shall be limited to the minimum amount needed for immediate disbursing 
needs.
    (3) Security. The supplier must establish an advance payment bond or 
guaranty in favor of the borrower/grantee providing adequate security 
for the amount of the advance payment.
    (4) Notice. In order for advance payments to be eligible under a 
competitive procurement, the solicitation document must state that such 
payments will be allowed and that a request for advance payments will 
not be considered an adverse factor in the award of the contract.
    (5) Approvals. All advance payments must be approved by USAID in 
writing.



Sec. 201.25  Bid and performance bonds and guaranties.

    Whenever the importer requires the posting of a bid bond or guaranty 
or performance bond or guaranty, the type of bond or guaranty (certified 
check, irrevocable letter of credit, bank bond, bank guaranty, or surety 
bond) shall be at the option of the bidder or supplier. Posted bid bonds 
or guaranties shall be returned to unsuccessful bidders promptly after 
an award is made. Unless converted to a required performance bond or 
guaranty, any bid bond or guaranty posted by the successful bidder shall 
also be returned promptly. Performance bonds or guaranties (as 
distinguished from commodity warranties of quality or performance) shall 
be canceled no later than 30 days after completion of the contract 
performance guarantied.



Sec. 201.26  Expenditure of marine insurance loss payments.

    Unless otherwise authorized by USAID, any marine insurance loss 
payment under a marine insurance policy financed pursuant to this part 
201 received by the importer, either directly or indirectly, shall be 
used by the importer as follows:
    (a) To procure from a source specified in the implementing document 
which originally provided the USAID funds, commodities which have been 
designated by USAID to the borrower/grantee as eligible for USAID 
financing; or
    (b) To cover the cost of repairs to commodities damaged during 
shipment.



                Subpart D--Responsibilities of Suppliers



Sec. 201.30  Purpose.

    This subpart establishes the responsibilities of suppliers who 
furnish commodities and/or commodity-related services.



Sec. 201.31  Suppliers of commodities.

    (a) Performance of the sales contract. The supplier of commodities 
shall comply with the terms and conditions of its contract with the 
importer and any letter of credit or direct letter of commitment under 
which it secures payment.
    (b) Responsibilities relating to eligibility of commodities. The 
supplier shall fulfill its responsibilities under Sec. 201.11 by 
assuring that:
    (1) The commodity conforms to the description contained in its 
contract and letter of credit or direct letter of

[[Page 623]]

commitment and, unless otherwise authorized by USAID in writing, the 
commodity is unused and has not been disposed of as surplus by any 
governmental agency;
    (2) The source of the commodity complies with the provisions of 
Sec. 201.11(b) relating to source as required by its contract, letter of 
credit or direct letter of commitment;
    (3) The provisions of Sec. 201.11(d) relating to the medium of 
transportation are complied with to the extent that the supplier 
arranges such transportation;
    (4) All documents required by Sec. 201.52 to be submitted by the 
supplier to receive payment are submitted by it on or before the 
terminal date specified in the letter of credit, direct letter of 
commitment, or, if payment is to be made at sight, the purchase 
contract;
    (5) The provisions of the U.S. Treasury Department Foreign Assets, 
Sanctions, Transactions and Funds Control Regulations published in 31 
CFR parts 500 through 599, as from time to time amended, are complied 
with; and
    (6) The purchase price of the commodity meets the requirements of 
subpart G of this part applicable to the supplier.
    (c) Responsibilities relating to eligibility of delivery services. 
The supplier of commodities shall be responsible for assuring that any 
delivery services obtained by it for its own or for the importer's 
account comply with the requirements of Sec. 201.13 and, if required by 
USAID, for assuring that any shipping documents obtained by it contain 
an appropriate diversion clause pursuant to Sec. 201.43. The supplier 
shall deliver to USAID any shipping documents available to it whenever 
such delivery is requested by USAID.
    (d) Marking of shipping containers and commodities--(1) Affixing 
emblems and identification numbers. The supplier of commodities shall be 
responsible for assuring that all export packaging, whether shipped from 
the United States or from any other source country, carries the official 
USAID (clasped hands) emblem. Additionally, except as USAID may 
otherwise prescribe, when the supplier is given notice by the importer 
that the importer is the government of the cooperating country or any of 
its subdivisions or instrumentalities, the supplier shall also be 
responsible for assuring that, in addition to the shipping cartons or 
other export packaging, all commodities carry the USAID emblem. The 
USAID financing document number shall be marked on each export shipping 
carton and box in characters at least equal in height to the shipper's 
marks. When commodities are shipped as containerized freight in a 
reusable shipping container, the container is not considered export 
packaging within the meaning of this paragraph and the outside of the 
container need not be marked; however, the cartons, boxes, etc., inside 
the container must be marked.
    (i) Durability of emblems. Emblems shall be affixed by metal plate, 
decalcomania, stencil, label, tag or other means, depending upon the 
type of commodity or export packaging and the nature of the surface to 
be marked. The emblem placed on commodities shall be as durable as the 
trademark, commodity or brand name affixed by the producer; the emblem 
on each export packaging unit shall be affixed in a manner which assures 
that the emblem will remain legible until the unit reach the consignee.
    (ii) Size of emblems. The size of an emblem may vary depending upon 
the size of the commodity and the size of the export packaging. The 
emblem shall in every case be large enough to be clearly visible at a 
reasonable distance.
    (iii) Design and color of emblems. Emblems shall conform in design 
and color to samples available from the Office of Procurement, Commodity 
Support Division, USAID, Washington, DC 20523-1415, and from the 
Mission.
    (2) Exception to requirement for affixing emblems. To the extent 
compliance is impracticable, emblems shall not be required for:
    (i) Raw materials shipped in bulk (including grain, coal, petroleum, 
oil, and lubricants);
    (ii) Vegetable fibers packaged in bales; and
    (iii) Semifinished products which are not packaged in any way.
    (3) Waiver. If compliance with the marking requirement is found to 
be impracticable with respect to other commodities not excepted by 
paragraph

[[Page 624]]

(d)(2) of this section, the supplier (or, when appropriate, the 
borrower/grantee) may request a waiver from USAID (Regional Assistant 
Administrator or his/her designee).
    (e) Export licenses and approvals. The supplier shall be solely 
responsible for assuring that all necessary export licenses and 
approvals are obtained.
    (f) Distribution of shipping documents. The supplier shall make the 
customary commercial document distribution, as well as any special 
distribution (e.g., to the USAID Mission in the importing country) which 
may be specified in the letter of credit, direct letter of commitment or 
other payment instruction covering the transaction. Prior to presenting 
the documents specified in Sec. 201.52 for payment, the supplier shall 
mail not later than 30 days from the date of shipment a legible copy of 
all rated ocean bill(s) of lading described in Sec. 201.52(a)(4)(i) to: 
Maritime Administration, Division of National Cargo, 400 Seventh Street 
SW., Washington, DC 20590-0001; and Transportation Division, Office of 
Procurement, USAID, Washington, DC 20523-1419.
    (g) Adjustment refunds, credits, and allowances. All adjustments in 
the purchase price in an USAID-financed transaction in favor of the 
importer arising out of the terms of the contract or the customs of the 
trade shall be made by the supplier in the form of a dollar payment to 
USAID. Any such payment shall be transmitted to the Office of Financial 
Management, USAID, Washington, DC 20523-0208, and shall be accompanied 
by a statement explaining the adjustment and shall specify the name and 
address of the importer, the date and amount of the original invoice, 
and the identification number of the implementing document, if known, 
under which the original transaction was financed. USAID will advise the 
borrower/grantee of such adjustment refunds received. Despatch earned by 
the supplier, other than despatch earned at the port of loading on 
c.i.f. and c. & f. shipments, shall be refunded to USAID in accordance 
with Sec. 201.67(a)(5).
    (h) Vesting in USAID of title to commodities. The supplier shall be 
responsible for compliance with the provisions of Sec. 201.44 applicable 
to it.
    (i) Termination or modification of USAID-financing. The supplier 
shall be responsible for compliance with the provisions of Sec. 201.45 
applicable to it.



Sec. 201.32  Suppliers of delivery services.

    (a) Performance of the service contract. The supplier of delivery 
services financed by USAID shall comply with the terms and conditions of 
its contract to supply delivery services.
    (b) Adjustment in the price of delivery services. The supplier of 
delivery services shall pay to the Office of Financial Management, 
USAID, Washington, DC 20523-0208, all adjustments in the purchase price 
in favor of the importer (or person purchasing the ocean transportation 
services) arising out of the terms of the contract or the customs of the 
trade. Any such payment shall be accompanied by a statement explaining 
the adjustment and shall specify the name and address of the importer or 
other person for whom the adjustment is made, the date and amount of the 
original invoice, and the identification number of the implementing 
document, if known, under which the original transaction was financed.
    (c) Marine insurance reporting requirement. With respect to any loss 
payment exceeding $10,000 in value which a supplier of marine insurance 
makes under a marine insurance policy financed pursuant to this part, 
the supplier of marine insurance shall, within 15 days of making such 
payment, report to the Commodity Support Division, Office of 
Procurement, USAID, Washington, DC 20523-1415, the amount and date of 
the payment, a description of the commodity, the USAID identification 
number, name of the carrier, vessel, and voyage number (alternatively, 
flight or inland carrier run number), date of the bill(s) of lading, the 
identity and address of the assured, and the identity and address of the 
assignee of the assured to whom payment has actually been made.

[[Page 625]]



Subpart E--General Provisions Relating to USAID Financing of Commodities 
                     and Commodity-Related Services



Sec. 201.40  Purpose.

    This subpart sets forth certain provisions of general application to 
transactions subject to this part.



Sec. 201.41  Audit and inspection.

    The borrower/grantee shall maintain records adequate to document the 
arrival and disposition in the cooperating country of all commodities 
financed by USAID, and to identify the importer (or the first purchaser 
or transferee if the commodity is imported by the borrower/grantee) for 
a period of 3 years following the date of payment or reimbursement by 
USAID or for such other period as USAID and the borrower/grantee agree. 
In addition, the borrower/grantee or the importer shall, to the extent 
either exercises control or custody over the commodities, permit USAID 
or any of its authorized representatives at all reasonable times during 
the 3-year or other agreed period to inspect the commodities at any 
point, including the point of use, and to inspect all records and 
documents pertaining to such commodities.



Sec. 201.42  Reexport of USAID-financed commodities.

    Unless specifically authorized by USAID, commodities imported into a 
cooperating country under USAID-financing may not be exported in the 
same or substantially in the same form from the cooperating country. In 
the event of any unauthorized reexport, the borrower/grantee shall pay 
promptly to USAID, upon demand, the entire amount reimbursed or such 
lesser or greater amount as USAID may deem appropriate under the 
circumstances of the particular transaction. Such an amount shall in no 
event, however, exceed the greater of either the amount reimbursed or 
the amount realized from the reexport.



Sec. 201.43  Diversion clause.

    USAID may require that charter parties, bills of lading, or other 
ocean shipping documents covering USAID-financed commodities contain a 
clause substantially as follows:

    USAID may at any time prior to unloading prescribe a different port 
of discharge from among the ports covered by the applicable tariff. 
Diversion charges shall apply in accordance with the tariff or contract 
of affreightment. Deviation insurance and extra handling costs actually 
incurred shall be reimbursed.



Sec. 201.44  Vesting in USAID of title to commodities.

    (a) Vesting upon order of USAID USAID may direct that title to 
USAID-financed commodities in transit to a cooperating country shall be 
vested in USAID if, in the opinion of USAID, such action is necessary to 
assure compliance with the provisions or purposes of any act of 
Congress.
    (1) Rights of USAID upon vesting of title. In accordance with 
instructions by USAID, the borrower/grantee, supplier, and bank shall 
transfer such negotiable bills of lading, suppliers' invoices, packing 
lists, inspection certificates or other designated documents relating to 
the commodities as are in, or may come into, their possession.
    (2) Diversion of commodities. USAID may direct the master or 
operator of a vessel or an inland carrier carrying the commodities to 
divert them away from the port or other destination specified in the 
shipping documents and to deliver them at such other destination as 
USAID may designate.
    (b) Financial responsibility of USAID under vesting order. (1) USAID 
will reimburse a supplier who has not already received payment under the 
purchase contract for all commodities with respect to which USAID has 
taken title under a vesting order.
    (2) USAID will assume the responsibility for any extra costs 
(including the costs of marine insurance and handling) which are 
incurred as a result of a diversion. Such costs shall not exceed 
diversion charges as per tariff (liner shipments) or contract of 
affreightment (charters), and shall include only those deviation 
insurance and extra handling costs which are actually incurred.
    (3) USAID shall incur no liability to the borrower/grantee, the 
importer, or to the approved applicant by reason of any order which 
vests in USAID title

[[Page 626]]

to commodities, or by reason of any request for the diversion of 
commodities.



Sec. 201.45  Termination or modification of a loan, grant or implementing document.

    (a) Effect of termination or modification. (1) Except as provided in 
paragraph (a)(2) of this section, the availability of USAID funds to 
finance the procurement of commodities and commodity-related services 
shall terminate or shall be modified, whenever and to the same extent 
that the implementing document which relates to such delivery is 
terminated or modified by operation of provisions contained in the 
document, or by the exercise of rights otherwise reserved to USAID.
    (2) Unless the supplier and USAID agree otherwise, to the extent 
that the supplier has received an irrevocable letter of credit from a 
bank under an USAID letter of commitment, the purchase contract shall be 
affected only to the extent necessary to comply with any vesting order 
issued by USAID in accordance with Sec. 201.44.
    (b) Responsibilities of parties after termination or modification of 
USAID-financing. Upon termination or modification of USAID-financing of 
commodities or commodity-related services, the supplier, importer and 
approved applicant shall make such arrangements as are necessary to 
obtain the cancellation or modification of any letter of credit in favor 
of the supplier.



Sec. 201.46  Compensation to supplier if shipment is prohibited.

    (a) Payment to supplier. USAID shall make appropriate payment to a 
supplier for the value of USAID-financed commodities available for 
immediate shipment from the United States if all the following 
conditions are satisfied:
    (1) Shipment is prohibited by order of the U.S. Government and such 
order has general application to all shipments to the cooperating 
country.
    (2) Payment may not be made by the bank under the terms of the 
letter of credit or payment instructions.
    (3) The supplier is unable to dispose of the commodities without 
loss.
    (4) The supplier tenders to USAID a negotiable warehouse receipt 
covering the commodities in question and presents to USAID such other 
documentation required by Sec. 201.52 as may be appropriate under the 
circumstances.
    (b) Other settlement. In lieu of accepting title to the commodities, 
USAID may negotiate with the supplier such other settlement as may be 
fair and equitable under the circumstances.



Sec. 201.47  Use of marine insurance loss proceeds.

    The borrower/grantee shall pay promptly to USAID a sum equal to the 
proceeds received by an importer or its assignee in settlement of a 
marine insurance claim under a marine insurance policy financed pursuant 
to this part 201, if such proceeds are not expended in the manner 
provided by Sec. 201.26 within a reasonable period after receipt by the 
importer.



                  Subpart F--Payment and Reimbursement



Sec. 201.50  Purpose.

    This subpart describes:
    (a) The methods by which USAID will make payment or reimbursement 
for commodities and commodity related services which have been 
furnished;
    (b) The documentation required to be submitted to USAID for the 
purpose of obtaining such payment or reimbursement; and
    (c) The terminal date for presentation of documents which USAID 
requires as a condition for payment or reimbursement.



Sec. 201.51  Methods of financing.

    Under procurements subject to this part 201, the following methods 
of financing may be employed by USAID In each case, the method of 
financing shall be consistent with provisions in the pertinent 
implementing documents.
    (a) Direct reimbursement. Upon presentation to USAID of the 
documents specified in Sec. 201.52, a borrower/grantee will be 
reimbursed for the cost of commodities and commodity-related services 
procured by the borrower/grantee directly or procured by other importers 
with the authorization of the borrower/

[[Page 627]]

grantee, if such commodities or services are eligible under the 
implementing document and under this part 201 for USAID-financing.
    (b) Letter of commitment to a bank. At the request of the borrower/
grantee, USAID will issue a letter of commitment to a bank for a 
specified amount in dollars. Reimbursement to a bank will be in 
accordance with the terms of such letter of commitment for sight 
payments made for the account of an approved applicant. Any such payment 
by a bank made in anticipation of a letter of commitment and falling 
within the scope of payments authorized by such letter of commitment 
when issued, will be deemed to be a payment to be reimbursed by USAID 
thereunder.
    (1) Requests for bank letters of commitment. All requests for bank 
letters of commitment shall be in the English language and shall be 
submitted to USAID by the borrower/grantee in duplicate. They shall 
contain the following:
    (i) Identification of the loan or grant agreement;
    (ii) The dollar amount of the letter of commitment;
    (iii) The name and address of the bank to which the letter of 
commitment is to be issued;
    (iv) The name and address of the approved applicant;
    (v) The expiration date to be stated in the letter of commitment, 
which shall be not later than the final date specified in the 
implementing document for submission of documentation to the bank as a 
basis for disbursement against the letter of commitment, except that, if 
a terminal shipping date is provided in the implementing document, the 
expiration date shall be the last day of the month following the month 
in which the terminal shipping date occurs.
    (vi) Identification of the items to be financed under the letter of 
commitment (including the Schedule B identification).
    (2) Approved applicant's request to bank--(i) Form and effect of 
request. An approved applicant may apply to the bank holding a letter of 
commitment for the issuance, confirmation, or advice of a commercial 
letter of credit for the benefit of a supplier, or may instruct the bank 
to make payments at sight to such supplier, or may instruct the bank to 
make payments at sight to or for the account of the borrower/grantee.
    (ii) Borrower/grantee assignment under a letter of commitment. The 
borrower/grantee's request to USAID for a letter of commitment shall be 
deemed notification to USAID of assignment of any rights to receive 
reimbursement for the specified funds under the related implementing 
document. USAID, by issuance of the letter of commitment, shall be 
deemed to have consented to such assignment. Any such assignment or 
consent shall inure to the benefit of the bank's legal successors and 
assignees.
    (iii) Requirements imposed by bank. The borrower/grantee and the 
approved applicant shall be deemed to have consented to imposition by 
the bank upon the beneficiary of any letter of credit or payment 
instruction of such requirements as the bank deems necessary in order to 
comply with its applicable obligations to USAID. Such consent shall be 
deemed an express condition incorporated in any request of the approved 
applicant under paragraph (b)(2)(i) of this section.
    (3) Reimbursement of bank. Upon presentation to USAID of the 
documents described in Sec. 201.52, USAID will reimburse the bank for 
any amounts paid by it in dollars to or on behalf of the approved 
applicant pursuant to a letter of commitment, subject, however, to 
compliance by the bank with the requirements of subpart H. Such 
documents in the normal course should be presented to USAID promptly. 
Bank charges will be eligible for reimbursement if authorized in the 
letter of commitment. Reimbursement normally will be made within 7 days 
by an electronic funds transfer.
    (c) Bank charges under letters of commitment. (1) To claim 
reimbursement for commissions, transfers or other charges, not including 
interest on advances, the bank shall submit the Voucher SF 1034 and 
shall attach thereto a copy of the payment advice which identifies the 
costs being billed.
    (2) To claim reimbursement for interest on advances, the bank shall 
claim

[[Page 628]]

reimbursement on the Voucher SF 1034, attaching thereto:
    (i) The monthly statement of advance account established under the 
letter of commitment, in duplicate, showing:
    (A) The opening balance;
    (B) The date and amount of each type of charge attributable to the 
letter of commitment, indicating the number of the letter of commitment, 
subsidiary letter of credit, or payment instruction or request under 
which the charge was made;
    (C) The date and amount of each USAID reimbursement to the bank, 
indicating either the USAID bureau voucher number or the number of the 
letter of commitment, subsidiary letter of credit, or payment 
instruction or request under which the payment was made; and
    (D) The closing balance;
    (ii) The bank's monthly advice of charge, in duplicate, showing:
    (A) The outstanding balance in the advance account on each day of 
the period covered; and
    (B) The amount of interest charged during the period.
    (3) Certification. Each claim for reimbursement shall have endorsed 
thereon or attached thereto a certification by an authorized 
representative of the bank that the charges for which payment is being 
claimed are in accordance with the schedule of charges agreed on between 
the bank and the approved applicant or beneficiary.
    (4) Report. The bank shall submit a report showing the financial 
status of each letter of commitment issued to it by USAID. The content, 
format and frequency of the report shall be prescribed in the letter of 
commitment. The report shall be prepared in an original and two copies, 
and distributed as follows: USAID/W (original), approved applicant 
(copy) and cognizant Mission (copy). The report to USAID/W should be 
sent to the Office of Financial Management, Letter of Commitment Branch, 
USAID, Washington, DC 20523-0208. The report shall be certified by an 
authorized signatory of the bank.
    (d) Direct letter of commitment to a supplier. (1) At the request of 
a borrower/grantee, USAID may issue a direct letter of commitment to a 
supplier assuring payment by USAID of specified amounts to cover the 
cost of commodities and commodity-related services. The letter of 
commitment to a supplier will identify the purchase contract to which it 
relates and the implementing document under which it is issued.
    (2) Assignment may be permitted as provided for in the direct letter 
of commitment.



Sec. 201.52  Required documents.

    (a) Commodities and commodity-related services. Claims for 
reimbursement or payment with respect to commodities and commodity-
related services shall be supported by the documents listed in 
paragraphs (a)(1) through (8) of this section or by such other documents 
as may be required in the letter of commitment or other applicable 
implementing document. Each document shall indicate the identification 
number of the letter of commitment or other applicable implementing 
document.
    (1) Voucher. Voucher SF 1034 with three copies, to be prepared by 
the borrower/grantee, by the approved applicant, by the bank as assignee 
or agent for the approved applicant, or, in the case of a direct letter 
of commitment, by the supplier.
    (2) Supplier's invoice. (i) One copy of the supplier's detailed 
invoice showing the following:
    (A) The name and address of the importer;
    (B) The quantity and the description of each item shipped, in 
sufficient detail, including the U.S. Department of Commerce Schedule B 
number, for ready identification;
    (C) The total gross sales price;
    (D) The total net sales price (determined by deducting from the 
total gross sales price the amounts required to be deducted under 
Sec. 201.65(d));
    (E) The sales price for each item net of all trade discounts under 
Sec. 201.65(d);
    (F) The delivery terms (e.g., f.o.b., f.a.s., c.i.f. or c. & f.);
    (G) The type and dollar amount of each incidental service which is 
not included in the price of the commodity and for which reimbursement 
is claimed;

[[Page 629]]

    (H) The type and dollar amount of each delivery service obtained by 
the supplier of the commodity for the importer's account which is not 
included in the price of the commodity and for which reimbursement is 
claimed;
    (I) To the extent that the commodity price includes commodity-
related services, a list of each such service and the dollar amounts 
attributable to each such service; and
    (J) Unless a Supplier's certificate covering marine insurance is 
submitted, the name and address of the supplier of such insurance and 
the dollar cost thereof.
    (ii) Each invoice submitted under a bank letter of commitment shall 
be marked PAID by the supplier, or alternatively, the bank may certify 
by an endorsement on or attachment to the invoice that payment has been 
made in the amount shown on the invoice.
    (iii) Each invoice must contain certifications from the supplier to 
the effect that:
    (A) The USAID marking requirements set forth in Sec. 201.31(d) have 
been met;
    (B) Unless otherwise specified by USAID, the supplier has airmailed 
to the USAID Mission in the capital city of the cooperating country one 
copy each of the invoice, packing list and bill(s) of lading;
    (C) If shipment is effected by ocean vessel, one copy of all bill(s) 
of lading described in Sec. 201.52(a)(4) has been maiIed to: Maritime 
Administration, Division of National Cargo, 400 Seventh Street SW., 
Washington, DC 20590-0001; and Transportation Division, Office of 
Procurement, USAID, Washington, DC 20523-1419.
    (3) Charter party. A copy (or photostat) of any approved charter 
party under which shipment is made, submitted:
    (i) By the commodity supplier whenever USAID-finances any portion of 
the dollar price of a commodity sale under c.&f. or c.i.f. delivery 
terms, or
    (ii) By the supplier of ocean transportation whenever USAID-finances 
the freight under any freight reimbursement arrangement.

If shipment is made under a consecutive voyage or time charter and the 
person or organization seeking reimbursement or payment has previously 
submitted to USAID a copy (or photostat) of said charter party in 
support of a prior claim for reimbursement or payment, such person or 
organization may, in lieu of further submission of the charter party, 
certify to the fact of prior submission.
    (4) Evidence of shipment. (i) A copy (or photostat) of the bill(s) 
of lading (ocean, charter party, air, rail, barge, or truck) or parcel 
post receipt evidencing shipment from the point of export in the source 
country or free port or bonded warehouse. The bill(s) of lading shall 
indicate the carrier's complete statement of charges, including all 
relevant weights, cubic measurements, rates and additional charges, 
whether or not freight is financed by USAID If an NVOCC is used, rated 
copies of both the NVOCC's through bill of lading and the bill(s) of 
lading of all VOCCs must be included.
    (ii) When the commodity is transported to the cooperating country 
under its own power (e.g., a fishing vessel), USAID will require a 
certificate signed by the importer or its authorized agent, certifying 
that the commodity has been received by the importer, to be submitted 
instead of a bill of lading.
    (iii) When the supplier is not responsible under the terms of its 
agreement with the importer for assuring that the commodities are loaded 
on board the vessel, such as when delivery terms are f.a.s. port of 
shipment, the importer may request and the Commodity Support Division, 
Office of Procurement, USAID, Washington, DC 20523-1415 may authorize 
the following documents, instead of a bill of lading, to be submitted 
with a claim for reimbursement or payment for the commodities:
    (A) A dock or warehouse receipt containing the commodity 
description, weight and cubic measurement, port of loading, and, if 
available, name and flag of vessel; the receipt must show consignment of 
the commodities to a person or organization designated by the importer; 
and
    (B) A letter from the consignee addressed to USAID undertaking to 
arrange for shipment of the goods to the cooperating country and to 
deliver to:

[[Page 630]]

FM/CMPD, Office of Financial Management, USAID, Washington, DC 20523-
0209, within 15 days from the date of shipment, a copy of the bill of 
lading evidencing shipment to the cooperating country. The bill of 
lading shall indicate the carrier's complete statement of charges, as in 
paragraph (a)(4)(i) of this section.
    (5) Documentation on shipments to a free port or bonded warehouse. 
When a commodity is shipped out of a free port or bonded warehouse, the 
supplier shall:
    (i) Provide as an attachment to a copy of the invoice, a copy of the 
bill of lading (bearing a notation of the freight cost) covering the 
shipment of the commodity into the free port or bonded warehouse, or
    (ii) If such a bill of lading is not available to the supplier, 
provide the following information and certify to the accuracy of the 
information: the country or area from which the commodities were shipped 
to such free port or bonded warehouse; the name and flag of the vessel 
which transported the commodities from the source country to the free 
port or bonded warehouse; the cost of the freight for such shipment; and 
the free port or bonded warehouse to which shipment was made from the 
source country, or
    (iii) If commodities have been commingled in the warehouse in such a 
way that shipments out of the warehouse cannot be related to particular 
shipments into the warehouse, the supplier shall certify to the best of 
its knowledge and belief that a portion of the commodities was 
transported to the free port or bonded warehouse as required by 
Sec. 201.13(b)(1)(i)(D), and the quantity for which USAID-financing is 
sought does not exceed that amount.
    (6) Supplier's Certificate (form AID 282). An original and one copy 
of the Supplier's Certificate executed, without modification, by:
    (i) The supplier of the commodity for the cost of the commodity and 
any commodity-related services furnished by the commodity supplier;
    (ii) The carrier for the cost of ocean or air transportation 
financed by USAID;
    (iii) The insurer for the cost of marine insurance financed by USAID 
if such cost exceeds $50.
    (7) Freight forwarder's invoice. One copy of the freight forwarder's 
invoice, if any, marked PAID and containing a complete, individually 
priced itemization of all charges and fees billed by or through the 
forwarder.
    (8) Commodity approval application (form AID 11). One signed 
original of the Commodity Approval Application executed by the commodity 
supplier and countersigned by USAID. In the case of a claim for 
reimbursement or payment for partial shipment presented subsequent to 
submission of the original Commodity Approval Application, one 
reproduced copy of the original countersigned Commodity Approval 
Application, appropriately certified as such by the supplier.
    (b) Execution of Certificates. (1) The original of each Supplier's 
Certificate and Commodity Approval Application shall be signed by hand 
and shall bind the person or organization in whose behalf the execution 
is made.
    (2) The Supplier's Certificate covering the cost of marine insurance 
may be executed on behalf of the marine insurer by an insurance broker 
or by a commodity supplier if the commodity supplier is the assured 
under an open cargo insurance policy issued by the marine insurer and is 
authorized under such policy to bind the marine insurer by issuing 
insurance certificates or policies in favor of importers. In each such 
case, the insurance broker or commodity supplier shall indicate on the 
Supplier's Certificate the name and address of the insurance company 
which is acting as the supplier of marine insurance and shall describe 
itself below its signature as a commodity supplier issuing a certificate 
under an open cargo insurance policy or as an insurance broker.



Sec. 201.53  Final date for presentation of documents.

    (a) Direct reimbursement. Prescribed documents shall be presented to 
USAID by the borrower/grantee no later than the terminal date specified 
in the implementing document.

[[Page 631]]

    (b) Letter of commitment to a bank. Prescribed documents shall be 
presented by the bank to USAID and shall cover:
    (1) Payments or negotiations made under letters of credit expiring 
no later than the expiration date stated in the letter of commitment, or
    (2) Payments to a supplier, the approved applicant, or, at the 
request of an approved applicant, to a person other than the supplier, 
made no later than such expiration date.
    (c) Direct letter of commitment to supplier. Documents prescribed 
for payment under a direct letter of commitment to a supplier shall be 
presented by the supplier to USAID no later than the expiration date 
stated therein. Such documents must evidence shipment no later than the 
terminal shipment date provided in the direct letter of commitment.



                       Subpart G--Price Provisions



Sec. 201.60  Purpose and applicability of this subpart.

    This subpart prescribes rules relating to prices, discounts, 
commissions, credits, allowances, and other payments. These rules shall 
be observed in the procurement of commodities and commodity-related 
services financed under this part. The rules implement and supplement 
the requirements of the Act relating to prices in such procurement. The 
general purpose of these rules is to assure the prudent use of USAID 
funds.
    (a) Statutory price limitations. (1) Section 604(a) of the Act 
provides inter alia that funds made available under this Act may be used 
for procurement outside the United States only if the price of any 
commodity procured in bulk is lower than the market price prevailing in 
the United States at the time of procurement adjusted for differences in 
the cost of transportation to destination, quality, and terms of 
payment.
    (2) Section 604(b) of the Act provides that no funds made available 
under this Act shall be used for the purchase in bulk of any commodities 
at prices higher than the market price prevailing in the United States 
at the time of purchase, adjusted for differences in the cost of 
transportation to destination, quality, and terms of payment.
    (b) Transactions covered. The rules and conditions prescribed by 
this subpart apply to all USAID-financed transactions subject to this 
regulation, whether or not the commodities are purchased in bulk.
    (c) Compliance. Compliance with this subpart G and with any 
additional price requirement contained in the implementing document 
shall be a condition to the financing by USAID of procurement 
transactions under this part. Post-audit of transactions will be made by 
USAID to determine whether there has been such compliance.



Sec. 201.61  Meaning of terms in this subpart.

    (a) Class of purchaser means any group of purchasers which is 
separately identifiable and which is distinguishable from other 
purchasers on the basis of quantity purchased, distribution function or 
established trade practice.
    (b) Commission. See Sec. 201.01(h).
    (c) Comparable domestic sale means any comparable sale not in export 
transactions.
    (d) Comparable export sale means any comparable sale in export 
transactions.
    (e) Comparable sale means any sale of or bona fide offer to sell the 
same commodity, or (in the absence of such a sale or offer to sell) any 
sale of or offer to sell a similar commodity which, with respect to the 
quantity, quality, grade, period of delivery, supply area, terms of 
sale, or class of purchaser, either:
    (1) Is not sufficiently different from the sale being tested to 
result customarily in a price different from the price in the sale being 
tested; or
    (2) Can be related to the sale being tested through application of a 
customary price differential. A sale which is otherwise comparable to 
another sale is not rendered noncomparable by virtue of its being made 
out of a free port or bonded warehouse. The fact that a sale is made out 
of a free port or bonded warehouse shall not cause that sale to differ 
from otherwise comparable sales with respect to terms of sale, supply 
area, or period of delivery.
    (f) The date the purchase price is fixed means the date on which the 
parties

[[Page 632]]

agree on the price. If, however, the parties establish the price as of 
any other date which is subsequent to the date of such agreement and not 
later than the date of delivery, the term means such other date 
regardless of whether it precedes, coincides with or follows the legally 
effective date of the purchase contract.
    (g) Export differential means the customary difference in price, if 
any, between domestic sales and otherwise comparable export sales.
    (h) Period of delivery means the length of time between the date the 
purchase price is fixed or the date of the purchase contract, whichever 
is later, and the date by which delivery is to be completed.
    (i) Producer means any person who grows, mines, manufactures, 
processes, or assembles a commodity in the form in which it is exported.
    (j) Purchase price means the total amount which the purchaser agrees 
to pay or make available to or for the benefit of the supplier 
(including any person or organization designated by the supplier to 
receive such payment) for any commodity or commodity-related service 
which is wholly or partly financed by USAID.
    (k) Representative of the importer means any entity affiliated with 
the importer by ownership or management ties, and any office or employee 
of such entity.
    (l) Similar commodity means a commodity which is functionally 
interchangeable with the commodity in the sale being tested, and affords 
the purchaser substantially equivalent serviceability.
    (m) Supply area means the source country, or if the commodity is 
customarily sold at different prices (exclusive of transportation costs) 
from different geographic areas within a source country, the specific 
geographic area within the source country from which the commodity is 
shipped to the cooperating country.
    (n) Time of purchase means that period encompassing the date the 
purchase price is fixed during which prices in comparable sales remain 
substantially constant.
    (o) Transportation cost means the cost of all transportation by 
land, sea, or air from the port of export to the destination in the 
cooperating country, plus the cost of marine insurance, if any, covering 
such transaction. Such costs are financed by USAID only to the extent 
provided in Sec. 201.13.



Sec. 201.62  Responsibilities of borrower/grantee and of supplier.

    (a) Responsibilities of borrower/grantee. The borrower/grantee 
shall:
    (1) When required by USAID, develop and periodically update, or 
cooperate with USAID in the development and updating of, lists of 
importers who have traditionally imported the commodities which may be 
purchased under the loan or grant. Such listings shall be by commodity 
groupings selected by USAID, cover all commodities eligible for 
financing, and, to the extent such information is available, show the 
names and addresses of all importers, regardless of the source from 
which their imports originated.
    (2) Insure that the importer
    (i) Procures in accordance with the conditions set forth in subpart 
C as applicable, and
    (ii) Except as provided otherwise in Sec. 201.22, pays no more than 
the lowest available competitive price, including transportation cost, 
for the commodity.
    (b) Responsibility of supplier. In accordance with the provisions 
contained in the Supplier's Certificate, which the supplier must execute 
in order to receive payment, the supplier is responsible for compliance 
with the provisions of this subpart G, other than paragraph (a) of this 
section.



Sec. 201.63  Maximum prices for commodities.

    (a) U.S. prevailing market price--U.S. source. The purchase price 
for a commodity, the source of which is the United States, shall not 
exceed the market price prevailing in comparable export sales in the 
United States at the time of purchase, adjusted for differences in the 
transportation cost: Provided, however, That if there are no such 
comparable export sales, then the purchase price, excluding 
transportation cost, may not exceed the market price prevailing in 
comparable domestic sales in the United States at the

[[Page 633]]

time of purchase, adjusted upward or downward by the appropriate export 
differential.
    (b) U.S. prevailing market price--non-U.S. source. The purchase 
price, including transportation cost, for a commodity the source of 
which is not the United States shall be lower than the market price 
prevailing in comparable export sales in the United States at the time 
of purchase including transportation cost: Provided, however, That if 
there are no such comparable export sales in the United States, then the 
purchase price from the source outside the United States, including 
transportation cost, must be lower than the market price prevailing in 
comparable domestic sales in the United States at the time of purchase, 
adjusted upward or downward by the appropriate export differential and 
transportation cost.
    (c) Supplier's comparable export price--U.S. and non-U.S. sources. 
(1) The purchase price excluding transportation cost, shall not exceed 
prices generally charged by the supplier in comparable export sales from 
the source country at the time of purchase.
    (2) The requirement in paragraph (c)(1) of this section shall not 
apply to the purchase price:
    (i) In any sale under formal competitive bid procedures; or
    (ii) In any sale of a commodity generally traded on an organized 
commodity exchange.
    (3) Comparable export sales for the purpose of paragraph (c) of this 
section shall not include sales:
    (i) Under formal competitive bid procedures; or
    (ii) Of a commodity by a supplier to affiliates if the supplier 
demonstrates an established practice of selling the commodity to 
affiliates at prices lower than the prices it charges to nonaffiliates.
    (d) Source country prevailing market price--non-U.S. source. The 
purchase price, excluding transportation cost, shall not exceed the 
market price prevailing in the source country in comparable export sales 
at the time of purchase: Provided, however, That, if there are no such 
comparable export sales, then the purchase price, excluding 
transportation cost, shall not exceed the market price prevailing in 
comparable domestic sales in the source country at the time of purchase, 
adjusted upward or downward by the appropriate export differential.
    (e) Price test in the absence of comparable sales at time of 
purchase--(1) Sale by supplier who is not the producer. The purchase 
price shall not exceed the sum of:
    (i) The lower of the following: The price paid by the supplier for 
the commodity or the price charged by the producer in the original sale 
of that specific commodity; and
    (ii) A markup over the amount allowed in paragraph (e)(1)(i) of this 
section which may not exceed the lower of the following: The markup over 
direct cost that is usual and customary in sales by the supplier of the 
same commodity, if any, or the most similar commodity, or, the markup 
over direct cost that is usual and customary in such sales by the 
competitors of the supplier; and
    (iii) To the extent not included in paragraph (e)(1)(i) of this 
section an amount not to exceed the cost at prevailing rates of those 
expenses recognized in Sec. 201.64(a) and actually incurred in moving 
the commodities supplied from the point of purchase to a position 
alongside or on board the vessel or other export conveyance at point of 
export.
    (2) Sale by a supplier who is the producer. The purchase price shall 
not exceed a price established in accordance with the customary pricing 
practices of the supplier for other products of the same general class 
as the commodity sold.
    (f) Additional rules for sales through or out of a free port or 
bonded warehouse. (1) The purchase price, including transportation costs 
to a cooperating country, of a commodity which has passed through a free 
port or bonded warehouse shall not exceed:
    (i) The maximum price f.o.b. or f.a.s. source country eligible for 
USAID-financing under the foregoing provisions of this Sec. 201.63: plus
    (ii) Transportation cost calculated on the basis of the prevailing 
ocean freight rate for shipments using the most direct route from the 
source country to the cooperating country on the type and flag of vessel 
on which the

[[Page 634]]

commodity actually moved from the free port or bonded warehouse to the 
cooperating country.
    (2) The purchase price of a commodity f.o.b. or f.a.s. a free port 
or bonded warehouse shall not exceed the maximum price established in 
paragraph (f)(1) of this section, minus transportation costs from the 
free port or bonded warehouse to the cooperating country, calculated on 
the basis of the prevailing ocean freight rate from the free port or 
bonded warehouse to the cooperating country for the type and flag of 
vessel on which the commodity actually moved between those points.
    (g) Commodity price subject to escalation. If a purchase contract 
contains a price escalation clause, USAID will finance:
    (1) The purchase price of the commodity before the operation of the 
escalation clause to the extent that it does not exceed the applicable 
price limitations contained in this subpart; and
    (2) That portion of the commodity price attributable to the 
operation of the price escalation clause if such clause:
    (i) Uses a formula based on variations in a cost factor which is 
reasonably related to the price of the commodity subject to escalation 
and is readily determinable;
    (ii) Provides for downward as well as upward adjustment of the 
price; and
    (iii) Accords with recognized trade practices.



Sec. 201.64  Application of the price rules to commodities.

    (a) Calculation of commodity prices on a common basis. In testing 
whether the purchase price of a commodity exceeds the price in 
comparable export sales or in comparable domestic sales, as applicable 
under Sec. 201.63 (a), (c), (d) and (e), it is necessary to insure that 
the price being tested as well as the prices being used as a test or 
measurement are calculated on the basis of delivery alongside or on 
board the vessel or other export conveyance. Such prices will include, 
therefore, in addition to the price of the commodity at an internal 
point in the source country, transportation from that point to the port 
of export in the source country, and to the extent not already included 
in the price at the internal point, inspection, export packing, 
forwarder's fees at customary rates, the cost of placing the commodities 
on board the vessel or export conveyance (unless this cost is covered in 
the export freight), and other necessary costs customary in the trade.
    (b) Calculation of commodity prices which involve transportation 
costs. (1) In testing the purchase price which includes transportation 
cost (customarily known as a c. & f. or c.i.f. price) for compliance 
with the requirements of Sec. 201.63 (a), (c), (d) and (e), USAID will 
subtract transportation cost as calculated by reference to the freight 
rate, for the type and flag of vessel on which the commodity was 
shipped, prevailing on the date the purchase price is fixed. In the 
absence of evidence to the contrary, the actual transportation cost paid 
by the supplier shall be presumed to be the transportation cost 
calculated in accordance with the formula contained in the foregoing 
sentence.
    (2) In testing a purchase price involving transportation cost for 
compliance with Sec. 201.62 and Sec. 201.63(b), the test or measurement 
prices shall be:
    (i) Prices based upon transportation by a U.S.-flag vessel if the 
price tested involves transportation by such vessel; or
    (ii) Prices based upon transportation by either a U.S.-flag or a 
foreign-flag vessel, whichever is lower, if the price tested involves 
transportation by a foreign-flag vessel.
    (c) Calculation of amount eligible for financing when shipment is 
through or out of a free port or bonded warehouse. (1) When a shipment 
to a cooperating country has passed through a free port or bonded 
warehouse, USAID will finance no more than the lower of the following:
    (i) The maximum price described in Sec. 201.63(f)(1), or
    (ii) The maximum price described in Sec. 201.63(f)(1)(i), plus any 
transportation costs into the free port or bonded warehouse which meet 
the requirements of Sec. 201.13(b)(1)(i)(D), and any transportation 
costs out of the free port or bonded warehouse on a vessel flying

[[Page 635]]

the flag of a country included in the authorized geographic code.
    (2) When a shipment is f.o.b. or f.a.s. a free port or bonded 
warehouse, USAID will finance no more than the lower of the following:
    (i) The maximum price described in Sec. 201.63(f)(2), or
    (ii) The maximum price described in Sec. 201.63(f)(1)(i), plus any 
transportation costs into the free port or bonded warehouse which meet 
the requirements of Sec. 201.13(b)(1)(i)(D).
    (d) Determination of prevailing prices. In the determination of any 
prevailing market price of any commodity or any prevailing price or 
maximum eligible freight rate for a commodity related service, relevant 
published and unpublished price information will be considered.



Sec. 201.65  Commissions, discounts and other payments, credits, benefits and allowances.

    (a) General. This section sets forth the rules which govern the 
eligibility of commissions, discounts and certain other payments, 
credits, benefits and allowances for USAID-financing.
    (b) Commissions to sales agents. Unless otherwise provided in the 
implementing document, a commission paid, or to be paid, to a bona fide 
agent of the supplier is eligible for financing under this part, if such 
agent either has made a direct and substantial contribution toward 
securing the purchase contract for the supplier or is engaged on a 
continuing basis in securing similar contracts for the supplier. Such 
commissions are eligible to the extent they comply with Sec. 201.65(f).
    (c) Commissions and other payments, credits, benefits or allowances 
to importers, purchasing agents and others. Unless otherwise authorized 
by USAID, no commission or other payment, credit, benefit or allowance 
of any kind shall be paid, made, or given, or agreed to be paid, made or 
given, in connection with any sale subject to this part by the supplier 
or its agent:
    (1) To or for the benefit of the importer;
    (2) To or for the benefit of a purchasing agent or other agent or 
representative of an importer, even though such agent or representative 
may also have an agreement with a supplier to represent the supplier; or
    (3) To any third party in connection with a sale by the supplier to 
its dealer, distributor, or established agent in the cooperating 
country.
    (d) Trade discounts. To arrive at the net amount eligible for USAID-
financing, all trade discounts, whether in the form of payments, 
credits, or allowances, to which the importer is entitled shall be 
deducted from the gross amount of the supplier's invoice submitted under 
Sec. 201.52(a)(2)(i)(D).
    (e) Commissions and other payments or benefits attributable to 
USAID-financing. Every commission or other payment, credit, benefit, or 
allowance of any kind paid, made or given, or agreed to be paid, made or 
given, in connection with the sale of commodities financed under this 
part to any person described in Sec. 201.65(c) (1), (2) or (3) shall be 
presumed conclusively to have been paid from USAID funds and shall 
thereby be subject to the requirements of this part 201.
    (f) Maximum commission. A commission shall not exceed the lesser of 
the amount which the supplier customarily pays in connection with 
similar transactions or the amount which is customary in the trade.
    (g) Reporting. All commissions and other payments, credits, benefits 
or allowances of any kind paid, made or given, or agreed to be paid, 
made or given, by the supplier in connection with USAID-financed sales 
of commodities and commodity-related services shall be fully reported on 
the Invoice-and-Contract Abstract of the Supplier's Certificate required 
under Sec. 201.52(a)(6). Any such amounts not reported shall be 
ineligible for USAID-financing.
    (h) Brokerage commission. In connection with ocean freight services, 
USAID will finance a brokerage commission only if:
    (1) Such commission does not exceed 2\1/2\ percent of the ocean 
freight charge (exclusive of deadfreight, demurrage and detention);
    (2) Such commission is payable to an individual resident in a 
country included in the authorized source code; a non-resident citizen 
of a country included in the authorized source code;

[[Page 636]]

or a corporation or partnership organized under the laws of a country 
included in the authorized source code; and
    (3) The names of all persons receiving such commissions appear on 
the face of the charter party.
    (i) Address commissions. An address commission to or for the benefit 
of a charterer shall be deemed a discount on the stated freight rate or 
freight charge which the supplier of transportation services shall 
deduct from the cost of transportation financed by USAID. If the 
supplier of the commodity is the charterer, it shall refund to USAID any 
address commission received by it. If the supplier of the commodity is 
not the charterer, the borrower/grantee shall be responsible for making 
a refund to USAID of any such commissions received by the charterer.



Sec. 201.66  Side payments.

    Any payment which an importer makes to a supplier, whether or not 
indicated on the supplier's invoice and whether or not financed by 
USAID, in connection with an USAID-financed transaction, shall be 
disclosed by the supplier on the Supplier's Certificate and shall be 
considered as part of the actual purchase price in applying the rules of 
this subpart G.



Sec. 201.67  Maximum freight charges.

    (a) Ocean freight rates--(1) Similar shipments. Similar shipments 
means shipments which are similar with respect to type of commodity, 
commodity rate classification, quantity, vessel flag category (U.S.-or 
foreign-flag), choice of ports, and other pertinent factors. In 
determining whether shipments are similar, no effect shall be given to 
the identity of the shipper or the circumstance that the shipment is or 
is not financed by the Government of the United States.
    (2) Maximum charter rates. (i) USAID will not finance ocean freight 
under any charter which has not been submitted to and received prior 
approval by USAID/W. USAID will not approve a charter if the freight 
rate exceeds:
    (A) The rate prevailing for similar shipments; or
    (B) The lowest rate charged by the vessel for similar shipments on 
the same voyage.
    (ii) In determining the rate prevailing for similar shipments, 
recognized sources of charter market rate information will be consulted 
and, if necessary, will be supplemented by other information which 
contributes to a realistic determination of the prevailing charter rate.
    (3) Effect of USAID approval of a charter. USAID prior approval of a 
charter shall be confirmed by USAID in writing and shall then be final 
except in cases where the freight rate exceeds the lowest rate charged 
by the vessel for similar shipments on the same voyage or where USAID's 
prior approval is based on false or misleading representations made to 
USAID by the charterer or vessel owner(s).
    (4) Maximum liner rates. USAID will not finance ocean freight for a 
cargo liner shipment at a rate which exceeds the lowest of the 
following:
    (i) The conference contract rate or the conference noncontract rate, 
whichever is lower;
    (ii) The rate named in any tariff or other rate listing for the same 
destination and commodities on file at the Federal Maritime Commission; 
or
    (iii) The lowest rate charged by the VOCC for similar shipments on 
the same voyage.
    (5) Despatch. (i) The borrower/grantee, or the supplier with respect 
to despatch earned by the supplier, shall be responsible for refunding 
to USAID all despatch earned:
    (A) At the port of unloading on c.i.f. or c. & f. shipments, or
    (B) At the port of loading or unloading on f.o.b. or f.a.s. 
shipments, to the extent that despatch exceeds demurrage incurred on the 
same voyage.
    (ii) Refunds of despatch, supported by the vessel's signed laytime 
statement(s), must be transmitted to the Office of Financial Management, 
USAID, Washington, DC 20523-0209, within 90 days after date of discharge 
of cargo on which the despatch was earned.
    (b) Airfreight rates. USAID will not finance airfreight which 
exceeds the following:

[[Page 637]]

    (1) The rate under any air charter approved by USAID covering the 
transaction;
    (2) The lowest rate charged by the carrier for similar shipments on 
the same flight; or
    (3) The rate prevailing in the industry for similar shipments. A 
similar shipment is one which is similar with respect to type of 
commodity, commodity rate classification, quantity, flag category, 
choice of airport, and other pertinent factors.



Sec. 201.68  Maximum prices for commodity-related services.

    (a) The price for an USAID-financed commodity-related service, other 
than ocean or air transportation, shall not exceed the lower of:
    (1) The prevailing price, if any, for the same or similar services; 
or
    (2) The price paid to the supplier under similar circumstances by 
other customers.
    (b) The eligible price of services covered by an NVOCC bill of 
lading is limited to the sum of the costs of individual delivery 
services eligible under Sec. 201.13 of this part, and only to the extent 
that the cost of each such service is eligible for USAID-financing under 
Sec. 201.67 or Sec. 201.68(a) of this part.



Sec. 201.69  Cooperating country taxes and fees.

    USAID will not finance any taxes or fees imposed under the laws in 
effect in the cooperating country, including customs duties, consular 
and legalization fees, and other levies.



             Subpart H--Rights and Responsibilities of Banks



Sec. 201.70  Purpose.

    This subpart sets forth the rights and responsibilities of banks 
with regard to reimbursement under a letter of commitment opened 
pursuant to an USAID request. Banks will not be held responsible for the 
requirements of subparts B, C, D, E (excluding Sec. 201.44(a)(1)), and 
subpart G except insofar as provisions of these subparts are included in 
this subpart H or in a letter of commitment issued by USAID to a bank.



Sec. 201.71  Terms of letters of credit.

    Any letter of credit issued, confirmed or advised under an USAID 
letter of commitment and any agreement relating to such letter of credit 
or to instructions for payment issued by an approved applicant shall not 
be inconsistent with or contrary to the terms of the letter of 
commitment. Any such letter of credit or agreement may be modified or 
extended at any time in such a manner and to such extent as is 
acceptable to the approved applicant and the bank: Provided, That such 
modification or extension may not be inconsistent with or contrary to 
the terms of the letter of commitment. In the case of any inconsistency 
or conflict between the terms and conditions of the letter of commitment 
and the instructions of the approved applicant, the terms and conditions 
of the letter of commitment shall control.



Sec. 201.72  Making payments.

    (a) Collection of documents. The bank shall be responsible for 
obtaining the documents specified in subpart F and in the letter of 
commitment when making payment under a letter of credit pursuant to 
instructions of an approved applicant.
    (b) Examination of documents other than Supplier's Certificate. The 
bank shall examine the documents (other than the Supplier's Certificate 
and the Commodity Approval Application) to be submitted to USAID in 
accordance with good commercial practice to determine whether such 
documents comply with the requirements of paragraphs (b) (1) through (7) 
of this section in the following particulars, and no other.
    (1) Shipment. The documents submitted as evidence of the shipment of 
commodities under Sec. 201.52(a)(4) shall be dated within the shipping 
period, if any, specified in the letter of commitment. The bill of 
lading shall contain the carrier's statement of charges whether or not 
freight is financed by USAID.
    (2) Source of commodities. The documents submitted in connection 
with the claim for reimbursement on commodities may not indicate that 
the source of the commodities is inconsistent with the USAID geographic 
code

[[Page 638]]

designation contained in the letter of commitment.
    (3) Destination. The documents submitted shall indicate that the 
destination of the commodities, by shipment, transshipment, or 
reshipment, is the cooperating country named in the letter of 
commitment.
    (4) Description. The documents shall describe and identify the 
commodities or services in a manner which, according to good commercial 
practice, is not inconsistent with the description contained in the 
letter of credit or payment instructions issued under a letter of 
commitment. The bank shall not be required to determine whether the 
supplier's invoice meets the detailed requirements of 
Sec. 201.52(a)(2)(i).
    (5) Discounts and purchasing agents' commissions. If the documents 
disclose that the invoice price includes either discounts or commissions 
payable to purchasing agents, the bank shall not make payment of such 
discounts and commissions. In the absence of such information, however, 
the bank shall not be required to make independent inquiry as to whether 
the invoice price includes such items.
    (6) Certifications. Each supplier's invoice presented for payment 
shall contain such other certifications as may be required in the letter 
of commitment. The bank shall accept only certifications which, to the 
best of its knowledge and belief, have been signed by hand.
    (7) Other requirements. The documents submitted shall contain such 
other information as required by the letter of commitment, except that 
the bank shall have responsibility in this regard only to the extent 
specifically indicated in the letter of commitment.
    (c) Acceptance of certificates. A bank shall not accept for 
submission to USAID the original of the Supplier's Certificate, or the 
Commodity Approval Application, unless, to the best knowledge and belief 
of the bank, each such original has been signed by hand by the supplier 
and the Commodity Approval Application has been countersigned by USAID.



Sec. 201.73  Limitations on the responsibilities of banks.

    The following general limitations on the responsibilities of banks 
issuing, advising, or confirming letters of credit and making payments 
under letters of credit or otherwise shall apply.
    (a) Sufficiency and completeness of documents. Any document, 
including the Supplier's Certificate and the Commodity Approval 
Application, submitted by a bank to USAID in support of a claim for 
reimbursement, shall be sufficient if it purports to be the sort 
required to be delivered and if it has been accepted by the bank in the 
ordinary course of business in good faith. Except as may be required in 
the discharge of its responsibilities under Sec. 201.72 (b) and (c), the 
bank's right of reimbursement shall not be affected by the fact that any 
document required to be submitted by it is incomplete or may indicate 
noncompliance with any provision of this part.
    (b) Reimbursement right notwithstanding certain deficiencies. A 
bank's right to reimbursement from USAID for payments which the bank has 
made will not be affected by the fact that the Commodity Approval 
Application or the Invoice-and-Contract Abstract on the reverse of the 
Supplier's Certificate may be incomplete, or may indicate noncompliance 
with any provision of this part 201, the letter of commitment, or any 
other implementing document, or may be inconsistent with other documents 
required for reimbursement.
    (c) Nonresponsibility of bank for truth or accuracy of statements or 
certifications. The bank shall not be responsible for the truth or 
accuracy of any information or statement contained in any Supplier's 
Certificate or any other document certification to be submitted by it to 
USAID, notwithstanding any knowledge or information in the actual or 
constructive possession of the bank to the contrary. The bank shall not 
be obligated to look beyond the documents, including any certifications 
endorsed thereon, to be submitted by it or to make any independent 
investigation as to the truth or accuracy of any information or 
statement contained therein.

[[Page 639]]

    (d) Protection of bank making payment. Acceptance by the bank of any 
document in the ordinary course of business in good faith as being a 
genuine and valid document and sufficient in the premises, and the 
delivery thereof to USAID, shall constitute full compliance by the bank 
with any provision of this part, the letter of commitment requiring 
delivery of a document of the sort that the document actually so 
delivered purports to be. The bank shall be entitled to receive and 
retain reimbursement of the amount of all payments made by it against 
documents so accepted, notwithstanding that such payments may be made in 
connection with a purchase in excess of the price calculated in 
accordance with the applicable provisions of subpart G.
    (e) Payment to third persons. The bank's right of reimbursement 
shall not be affected by the fact that payment is made to the approved 
applicant or at the request of the approved applicant or such 
beneficiary to a person other than the supplier under the contract to 
which such payment relates, if the bank has complied with all other 
requirements of the letter of commitment and has satisfied itself in 
good faith that the person to whom it makes payment has, in turn, made 
payment to the supplier.
    (f) Bank procedures with regard to certain suppliers. In the event a 
bank receives written advice from USAID concerning special conditions 
which are applicable to transactions of particular suppliers, such bank 
will use reasonable care to maintain procedures designed to ensure that 
accommodations thereafter furnished by it with respect to such suppliers 
by means of the issuance, confirmation, advising or transfer of letters 
of credit, or the making of payments not under letters of credit shall 
reflect such special conditions. While banks are expected to comply with 
the foregoing obligation, a bank which has used reasonable care to 
establish and maintain such procedures will not be responsible for any 
inadvertent furnishing of any such accommodation not containing 
applicable special conditions or the making of payment thereunder. For 
the purpose of ascertaining whether the supplier is a person or 
organization subject to an USAID advice concerning special conditions 
applicable to its transactions under this paragraph, a bank, in making 
payment under a letter of credit or otherwise, may consider as supplier 
the person or organization issuing the invoice.
    (g) Provision of implementing documents. A bank shall not be 
responsible for compliance with any provision of an implementing 
document other than a letter of commitment.



Sec. 201.74  Additional documents for USAID.

    In addition to the documents required for reimbursement, a bank 
shall retain in its files for a period of at least 3 years and shall 
make available to USAID promptly upon request a copy of any of the 
following documents which may pertain to an USAID-financed transaction:
    (a) Each letter of credit issued, confirmed, or advised by it, 
together with any extension or modification thereof;
    (b) Payment instructions received from the approved applicant;
    (c) Each application and agreement relating to such letter of credit 
or instructions for payment, together with any extension or modification 
thereof;
    (d) A detailed advice of the interest, commissions, expenses, or 
other items charged by it in connection with each such letter of credit 
or payment instructions.



Sec. 201.75  Termination or modification.

    If USAID directs that the delivery of commodities be terminated, 
orders that title to commodities be vested in it, or modifies any 
implementing document concerning the disposition of documents, USAID 
shall give written notice thereof to the banks holding applicable 
letters of commitment and shall instruct each bank with regard to the 
disposition of documents. Each such bank shall be relieved of any 
liability whatsoever to the approved applicant for anything done or 
omitted to be done under instruction of USAID. Notwithstanding the 
foregoing, a bank shall comply with the instructions of USAID only to 
the extent that it may do so without impairing or affecting any 
irrevocable obligation to any person or organization except an approved

[[Page 640]]

applicant, and in the event the bank shall incur any costs, expenses, or 
liabilities, including any liability to the approved applicant, it shall 
be repaid and reimbursed by USAID in respect thereof.



      Subpart I--Rights and Remedies of USAID, and Waiver Authority



Sec. 201.80  Purpose.

    This subpart sets forth certain USAID rights and remedies against 
borrower/grantees and suppliers, and prescribes certain general 
provisions relating to the waiver by USAID of this part.



Sec. 201.81  Rights of USAID against borrower/grantees.

    If any transaction financed hereunder violates the requirements of 
this part or any U.S. statute or any rule or regulation of USAID 
promulgated under any such statute, USAID may require the borrower/
grantee to refund the amounts USAID determines are attributable to such 
violation and may exercise any right of acceleration or termination 
contained in the implementing document. The borrower/grantee shall be 
deemed to have agreed to make such refund or accelerated payment 
promptly upon request by USAID and shall be deemed to have consented to 
any modification of the implementing document determined by USAID to be 
necessary to reflect any such refund or acceleration.



Sec. 201.82  Rights of USAID against suppliers.

    Without limiting the responsibility of the borrower/grantee or other 
parties, USAID may require an appropriate refund to it by a supplier 
under any transaction which violates the requirements of this part, 
whenever in USAID's opinion the failure of the supplier to comply with 
the rules and other requirements of this part has contributed to such 
violation. Any refund requested will include interest from the time of 
payment to the supplier. Interest will be charged at the rate 
established by the Secretary of the Treasury in accordance with the 
Internal Revenue Code, 26 U.S.C. 6621(b).



Sec. 201.83  No waiver of alternative rights or remedies by USAID.

    No right reserved to USAID in this subpart to seek a refund from a 
borrower/grantee, and no exercise of such right, whether or not 
successful, shall in any way limit or affect, under the doctrine of the 
election of remedies or otherwise, USAID's rights against a supplier 
under this subpart I or under the laws of the United States, or of any 
other country or political subdivision thereof, nor shall any right or 
remedy herein reserved to USAID against a supplier in any way derogate 
from or otherwise limit any other rights or remedies which may accrue to 
USAID under such laws.



Sec. 201.84  Limitation on period for making refund requests.

    USAID will endeavor, but shall not be bound, to make any requests 
for refunds from a borrower/grantee within three years from the date of 
the last disbursement of USAID funds for the transaction to which such 
request relates.



Sec. 201.85  Legal effect of USAID approvals and decisions.

    In any transaction subject to this part 201, USAID may reserve 
certain rights to approve the transaction for USAID-financing. USAID, in 
reserving any approval rights, acts solely as a financing entity to 
assure the proper use of United States Government funds. Any decision by 
USAID to exercise or refrain from exercising these approval rights shall 
be made as a financier and shall not be construed as making USAID a 
party to the contract or incurring any liability to the parties jointly 
or to any of them.



Sec. 201.86  Waiver and amendment authority.

    USAID may waive, withdraw, or amend at any time any or all of the 
provisions of this part.

[[Page 641]]



 Appendix A to Part 201--Supplier's Certificate and Agreement With the 
             Agency for International Development (AID 282)
[GRAPHIC] [TIFF OMITTED] TC06OC91.003


[[Page 642]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.004


[[Page 643]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.005


[[Page 644]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.006


[[Page 645]]



     Appendix B to Part 201--Application for Approval of Commodity 
                          Eligibility (AID 11)
[GRAPHIC] [TIFF OMITTED] TC06OC91.007


[[Page 646]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.008


[[Page 647]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.009


[[Page 648]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.010



PART 202--OVERSEAS SHIPMENTS OF SUPPLIES BY VOLUNTARY NON-PROFIT RELIEF AGENCIES--Table of Contents




Sec.
202.1  Definition of terms.
202.2  Shipments eligible for reimbursement of freight charges.
202.3  Freight reimbursement limitations.
202.4  Certificates.
202.5  Approval of programs, projects and services.
202.6  Applications for reimbursement of

[[Page 649]]

          freight charges.
202.7  Documentation required for reimbursement.
202.8  Refund by suppliers and/or agencies.
202.9  Waiver authority.

    Authority:  202.1 to 202.9 issued under sec. 621, 75 Stat. 424, as 
amended; 22 U.S.C. 2151. Interpret or apply secs. 102, 92 Stat. 937, 22 
U.S.C. 2151u; E.O. 10973, 26 FR 10469, 3 CFR 1961 Supp.

    Source:  44 FR 41425, July 17, 1979, unless otherwise noted.

    Editorial Note: Nomenclature changes for part 202 appear at 62 FR 
38027, July 16, 1997.



Sec. 202.1  Definition of terms.

    (a) The Administrator means the Administrator of the Agency for 
International Development.
    (b) The Committee means the Advisory Committee on Voluntary Foreign 
Aid of the Agency for International Development.
    (c) Supplies means development, relief and rehabilitation supplies 
shipped in support of programs approved by AID as well as administrative 
supplies and equipment shipped in support of such programs. In no case 
shall such supplies include items for the personal use of 
representatives of the registered agency.
    (d) Agency or agencies means the American Red Cross and any United 
States voluntary non-profit relief agency registered with and approved 
by the Committee.
    (e) Duty free means exempt from all customs duties, and other 
duties, tolls, and taxes of any kind.
    (f) Recipient country means any country or area in which voluntary 
non-profit relief agencies registered with and approved by the Advisory 
Committee on Voluntary Foreign Aid have programs approved by AID.
    (g) Reimbursement means (1) payment directly to an agency by AID, or 
(2) payment to an agency by a banking institution in the United States 
acting under letter of commitment issued by AID guaranteeing subsequent 
reimbursement to the banking institution of such payment.
    (h) Port of entry means an ocean port in the recipient country.
    (i) Point of entry means the first customs point, or any otherwise 
designated point in a recipient country which receives imported 
commodities via an ocean port not located in the recipient country.



Sec. 202.2  Shipments eligible for reimbursement of freight charges.

    (a) In order to further the efficient use of United States voluntary 
contributions for development, relief, and rehabilitation in nations or 
areas designated by the Administrator of AID from time to time, agencies 
may be reimbursed by AID within specified limitations for freight 
charges incurred and paid in transporting supplies donated to or 
purchased by such agencies from United States ports or, in the case of 
excess or surplus property supplied by the United States, from foreign 
ports to ports of entry in the recipient country or to points of entry 
in the recipient country in cases (1) of landlocked countries, (2) where 
ports cannot be used effectively because of natural or other 
disturbances, (3) where carriers to a specified country are unavailable, 
or (4) where a substantial savings in costs or time can be effected by 
the utilization of points of entry other than ports.
    (b) Shipments shall be eligible for reimbursement of freight charges 
only as authorized by the issuance by AID of a Procurement Authorization 
(Form AID 1160-4).
    (c) The Office of Commodity Management, Bureau for Program and 
Management Services, AID, shall be responsible for determining when 
carriers are ``unavailable.''



Sec. 202.3  Freight reimbursement limitations.

    Economic utilization of AID funds available for reimbursement to 
agencies for freight charges incurred and paid by such agencies for the 
shipment of donated or purchased supplies to a recipient country 
requires the following limitations on amounts reimbursable:
    (a) Ocean freight. The amount of ocean freight charges reimbursable 
to an agency is limited to the actual cost of transportation of the 
supplies as assessed by the delivering carrier either in accordance with 
its applicable tariff for delivery to the discharge port or in 
accordance with the applicable charter

[[Page 650]]

or booking contract at a rate not exceeding the prevailing rate, if any, 
for similar freight services, or the rate paid to the supplier of ocean 
transportation for similar services by other customers similarly 
situated, as attested to by the supplier in Block 13 of Form AID 1550-1, 
entitled ``Voluntary Agency and Carrier Certificate.'' (See 
Sec. 202.4(a).)
    (b) Inland freight. The amount of inland freight charges 
reimbursable to an agency is limited to the actual cost of 
transportation of supplies from pickup point in initial port of 
discharge to designated point of entry in the recipient country at a 
rate negotiated by the agency representative as attested to by such 
agency representative in Block 14 of Form AID 1550-1, entitled 
``Voluntary Agency and Carrier Certificate.'' (See Sec. 202.4(b).)
    (c) Related shipping costs. Where inland freight charges are 
reimbursed, expenses incurred in transferring supplies from ocean 
carrier to inland carrier may be reimbursed to the agency when such 
expenses are not for account of the ship nor included in the inland 
transportation charges.



Sec. 202.4  Certificates.

    Certificates will be required as follows:
    (a) Ocean transportation. The supplier of ocean transportation will 
execute Form AID 1550-1, entitled ``Voluntary Agency and Carrier 
Certificate,'' in an original and two copies.
    (b) Inland transportation and related shipping costs. Where inland 
transportation, including related shipping costs, is reimbursable under 
provisions of Sec. 202.3, the representative of the agency will execute 
Form AID 1550-1, entitled ``Voluntary Agency and Carrier Certificate,'' 
in an original and two copies when, in the absence of published tariffs 
or a prevailing rate, it is necessary to negotiate for the shipment of 
the supplies.



Sec. 202.5  Approval of programs, projects and services.

    (a) Prior to applying for reimbursement for freight charges, an 
agency must obtain AID's written approval of its programs by submitting 
the following information to the Chief, Public Liaison Division, Office 
of Private and Voluntary Cooperation, Bureau for Private and Development 
Cooperation, Agency for International Development, Department of State, 
Washington, DC 20523.
    (1) A narrative description detailing the agency's specific country 
programs, objectives, projects, or services of relief, rehabilitation, 
disaster assistance, development assistance and welfare;
    (2) Except as provided for in paragraph (b) of this section, 
evidence that written assurances have been obtained from the government 
of the recipient country that:
    (i) Appropriate facilities are or will be afforded for the necessary 
and economical operations of the program, project, or service;
    (ii) The specific program, project, or service has been accepted;
    (iii) The supplies provided in support of the program, project or 
service will be free of customs duties, other duties, tolls and taxes;
    (iv) The supplies will be treated as a supplementary resource;
    (v) The supplies will be identified, to the extent practicable, as 
being of United States origin; and
    (vi) Insofar as practicable, the supplies will be received, 
unloaded, warehoused, and transported cost-free to points of 
distribution;
    (3) Evidence that:
    (i) Shipments will be made only to consignees reported to AID, and 
full responsibility is assumed by the agency for the noncommercial 
distribution of the supplies free of cost to the persons ultimately 
receiving them, or in special cases and following notice to AID, for the 
sale to recipients at nominal cost or as payment for work performed to 
promote projects of self-help and economic development, but in no case 
shall supplies be withheld from needy persons because of their inability 
to pay or work; and
    (ii) Distribution is made solely on the basis of need without regard 
to race, color, religion, sex or national origin;
    (iii) That paragraphs (a)(3) (i) and (ii) of this section are 
conducted under the supervision of the agency's representative 
specifically charged with responsibility for the program or project.

[[Page 651]]

    (b) Compliance with paragraph (a)(2) of this section is not required 
when the specific program, project, or service is within the scope of 
any agreement that has been concluded between the U.S. Government and 
the Government of the recipient country which furthers the operations of 
an agency acceptable to the recipient country.
    (c) On approval of the agency's programs written notice thereof will 
be issued by AID to the agency.



Sec. 202.6  Application for reimbursement of freight charges.

    (a) Any agency may make application for reimbursement of freight 
charges incurred and paid on shipments eligible under Sec. 202.2 
provided:
    (1) The agency has received AID's written approval of the programs, 
projects, and services in accordance with Sec. 202.5.
    (2) The application for reimbursement of freight charges together 
with documentation required under Sec. 202.7 is submitted to the Agency 
for International Development, Attention: Banking and Finance Division, 
Office of Financial Management, Washington, DC 20523, or to a U.S. bank 
holding an AID letter of commitment.
    (b) In the case of ocean transportation, the application must be 
submitted within 60 days of the date of the related ocean bill of 
lading. In the case of inland transportation the application must be 
submitted within 180 days of the date of the related ocean bill of 
lading.



Sec. 202.7  Documentation required for reimbursement.

    Claims for reimbursement of freight charges must be supported by the 
following documents:
    (a) Voucher SF 1034. ``Public Voucher for Purchases and Services 
Other than Personal''--Voucher SF 1034 in original and three copies to 
be prepared by the agency requesting reimbursement of freight charges.
    (b) Bills of lading--(1) To ports of entry. Where the shipment is 
made to a port of entry, ocean or charter party bill of lading (or 
photostat) evidencing shipment from an eligible port of export as 
prescribed in Sec. 202.2(a) to the port of entry. The bill of lading 
shall indicate the carrier's complete statement of charges including all 
relevant weights, cubic measurements, rates, and any applicable tariff 
surcharges.
    (2) To points of entry. (i) Where the shipment is made to a point of 
entry and through bills of lading to designated point of entry are not 
issued, an ocean or charter party bill of lading (or photostat) 
evidencing shipment from an eligible port of export as precribed in 
Sec. 202.2(a) to the port of discharge, and a receipted copy of the 
rail, truck, or barge bills of lading (or other acceptable commercial 
document) covering the transportation of the supplies from the ocean 
carrier's point of delivery at port of discharge to point of entry in 
recipient country, correctly assessed at time of loading by the land 
carrier for freight on a weight, measurement, or unit basis to point of 
entry in recipient country and from point of entry to point of delivery 
in the recipient country. The bill of lading shall indicate the 
carrier's complete statement of charges including all relevant weights, 
cubic measurements, rates and any applicable tariff surcharges.
    (ii) Where shipment is made to point of entry and through bills of 
lading are issued, a receipted copy of the through bill of lading 
evidencing shipment from an eligible port of export as prescribed in 
Sec. 202.2(a) to point of entry in the recipient country. The bill of 
lading shall include the carrier's complete statement of charges 
including all relevant weights, cubic measurements, rates, and any 
applicable tariff surcharges.
    (c) Receipted invoices. One copy (or photostat) of the detailed 
invoice of the supplier of the transportation evidencing payment by the 
agency to the carrier. If the bills of lading required by paragraph (b) 
of this section meet the requirements of this subparagraph, no invoice 
is required.
    (d) Voluntary Agency and Carrier Certificate, Form AID 1550-1. (i) 
As provided in Sec. 202.4(a), the original and two copies of the 
Voluntary Agency and Carrier Certificate executed by the supplier of 
ocean transportation, and
    (ii) As provided in Sec. 202.4(b), the original and two copies of 
the Voluntary Agency and Carrier Certificate executed by the Agency.

[[Page 652]]



Sec. 202.8  Refund by suppliers and/or agencies.

    (a) By suppliers. Any supplier of freight to whom freight charges 
have been financed by AID will promptly refund to AID upon demand the 
entire amount, or any lesser amount specified, of such freight charges 
determined by AID to be in excess of the prevailing rate at time of 
shipment, if any, or the rate paid the supplier for similar services by 
other customers similarly situated.
    (b) By agencies. Any agency to which freight charges have been paid 
or reimbursed under this Regulation will promptly refund to AID upon 
demand the entire amount, or any lesser amount specified, of inland 
transportation and/or related shipping costs, (1) whenever AID 
determines that the reimbursements were improper as being in violation 
of the provisions of the Foreign Assistance Act of 1961, and relevant 
appropriation acts, or any rules, regulations, or procedures of AID 
promulgated under any of these acts, or (2) whenever it is determined by 
the agency or AID that any of the supplies for which reimbursement was 
made have not been accorded duty-free status by the recipient country.



Sec. 202.9  Waiver authority.

    The Administrator may waive, withdraw, or amend from time to time 
any or all of the provisions of this part.



PART 203--REGISTRATION OF AGENCIES FOR VOLUNTARY FOREIGN AID--Table of Contents




Sec.
203.1  Purpose.
203.2  Conditions of registration and documentation requirements for 
          U.S. private and voluntary organizations.
203.3  Annual requirements.
203.4  Certificates of registration.
203.5  Denial of registration and reconsideration.
203.6  Registration of foreign private and voluntary organizations.
203.7  Termination of registration.
203.8  Delegation of authority.
203.9  Access to records.
203.10  Waiver authority.

    Authority:  Sec. 621, Foreign Assistance Act of 1961, as amended (22 
U.S.C. 2381).

    Source:  48 FR 2760, Jan. 21, 1983, unless otherwise noted.



Sec. 203.1  Purpose.

    (a) AID maintains two registries of PVOs engaging in, or intending 
to engage in, voluntary foreign aid operations--one of U.S., the other 
of foreign PVOs. The registry facilitates cooperation between AID and 
the nonprofit private sector by providing a mechanism for identifying 
which organizations are eligible for AID resources intended for PVOs.
    (b) Registration is a condition of eligibility for assistance under 
sections 123b and 607(a) of the FAA (the payment of transportation 
charges and the sale of services or commodities such as excess property) 
and confers a preference for assistance under section 202 of Pub. L. 
480. Other eligibility requirements apply, however, including a program 
review.
    (c) Registration is a condition of eligibility for assistance under 
the ``PVO grant program.'' However, it is only one of several 
eligibility requirements for such assistance. Others include: (1) 
Program review; (2) pre-grant award review, including compliance with 
OMB Circulars A-110 and A-122; and (3) funding requirements of section 
123(g) of the FAA.
    (d) The registry serves as the basis for computing the amount of AID 
funding made available to PVOs.
    (e) Registration provides the information necessary to determine 
whether a PVO meets the funding requirements of section 123(g) of the 
FAA. Section 123(g) provides that a PVO must obtain at least 20 percent 
of its total annual financial support for its international activities 
from sources other than the United States Government to be eligible to 
receive funding under the PVO grant program. Further, a preference is 
given to those PVOs which receive cash from private, i.e., 
nongovernmental, sources.
    (f) It is not the purpose of registration to make, or enable to be 
made, any representation to the public concerning the meaning of being 
registered.
    (g) Definitions: As used in this part:
    (1) AID means Agency for International Development.

[[Page 653]]

    (2) FAA means the Foreign Assistance Act of 1961, as amended, 22 
U.S.C. 2151 et seq.
    (3) Funds from private U.S. sources means cash contributions 
received from private nongovernmental U.S. sources, e.g., private 
individuals, groups, foundations and corporations. Cash contributions 
received directly or indirectly from the U.S. Government, state or local 
governments, the United Nations and other public international 
organizations, and foreign governments, institutions and individuals are 
not included. All in-kind contributions are excluded.
    (4) Overseas program costs means the costs of all voluntary foreign 
aid operations conducted outside the U.S. and includes that portion of 
applicable indirect costs incurred in the U.S. (excluding fund-raising 
costs) necessary to carry out those voluntary foreign aid operations.
    (5) Pub. L. 480 means the Agricultural Trade and Development 
Assistance Act of 1954, as amended. 7 U.S.C. 1691 et seq.
    (6) PVO means private and voluntary organizations.
    (7) PVO grant program means those grants which AID has determined as 
a matter of policy can be made to only those PVOs which are registered 
and which meet the funding requirements of section 123(g) of the FAA, 22 
U.S.C. 215u(g).
    (8) Subventions means (i) The payment of transportation charges 
under section 123(b) of the FAA, 22 U.S.C. 215u(b); (ii) The sale of 
services or commodities, e.g., excess property, under section 607(a) of 
the FAA, 22 U.S.C. 2357(a); and (iii) The furnishing of agricultural 
commodities under section 202 of Pub. L. 480, 7 U.S.C. 1722.



Sec. 203.2  Conditions of registration and documentation requirements for U.S. private and voluntary organizations.

    An applicant shall be registered with A.I.D. as a U.S. PVO if A.I.D. 
finds that the applicant has satisfied all the conditions and 
documentation requirements of registration listed below. An applicant 
seeking registration shall submit to A.I.D., Washington, DC 20523, the 
documentation listed below accompanied by a letter stating the reasons 
for seeking registration signed by its chief executive officer and 
supported by a resolution of its governing body. In addition, the 
applicant shall submit such other information as A.I.D. may reasonably 
require to determine if the applicant should be registered.
    (a) Condition and documentation requirement no. 1--(1) Condition. 
That the applicant is a private nongovernmental organization which is 
organized under U.S. law and maintains its principal place of business 
in the United States and is not a university, college, accredited 
degree-granting institution of education, private foundation, 
organization engaged exclusively in research or scientific activities, 
church, or organization engaged exclusively in religious activities.
    (2) Documentation requirement. Articles of incorporation, bylaws, 
relevant documents establishing its legal status, and a statement as to 
the location of the organization's principal offices.
    (b) Condition and documentation requirement, no. 2--(1) Condition. 
That the applicant receives funds from private U.S. sources, as defined 
in paragraph (g)(3) of Sec. 203.1.
    (2) Documentation requirement. The latest audited financial 
statement (see Condition No. 6 at Sec. 203.2(f) of this section).
    (c) Condition and documentation requirement no. 3--(1) Condition. 
That the applicant is a nonprofit organization and has a tax exemption 
under any one of the following provisions of the Internal Revenue Code: 
section 501(c)(3), except private foundations under section 509(a)(2); 
as a social welfare organization under section 501(c)(4); section 
501(c)(5); or section 501(c)(6).
    (2) Documentation requirement. IRS Statement of Tax Exemption, and a 
copy of IRS Form 990 or 990-PF ``Return of Organization Exempt from 
Income Tax,'' or one comparable to the Internal Revenue Service 
document.
    (d) Condition and documentation requirement no. 4--(1) Condition. 
That the applicant is a voluntary organization, i.e., receives voluntary 
contributions of money, staff time or in-kind support from the general 
public.
    (2) Documentation requirement. Latest annual report (or similar 
document)

[[Page 654]]

and audited financial statement (see Condition No. 6 at Sec. 203.2(f)).
    (e) Condition and documentation requirement no. 5--(1) Condition. 
That the applicant is, or anticipates becoming, engaged in voluntary 
charitable or development assistance operations abroad (other than 
religious), including but not limited to services of relief, 
rehabilitation, disaster assistance, development assistance, welfare, 
training, or program support and coordination for such services, in the 
fields of health, education, population planning, nutrition, 
agriculture, industry, environment, ecology, refugee services, 
emigration, resettlement, and development of capacities in indigenous 
PVOs and institutions to meet basic human needs; and that such 
operations are consistent with its articles of incorporation and related 
documentation included in the application, and with the broad purposes 
of the Foreign Assistance Act and Pub. L. 480.
    (2) Documentation requirement. Latest annual report (or similar 
document) describing the development assistance operations. For 
organizations who anticipate initiating overseas activities, a statement 
should be included in the letter accompanying the registration 
documentation describing steps taken to date to undertake a program of 
development assistance overseas.
    (f) Condition and documentation requirement no. 6--(1) Condition. 
That the applicant accounts for its funds in accordance with generally 
accepted accounting principles (``GAAP''); has a sound financial 
position as evidenced by its audited financial statements; and exercises 
financial planning through the preparation of an annual budget for the 
year subsequent to that covered in the annual audit.
    (i) Further tests of the financial management systems of a PVO are 
part of the A.I.D. pre-grant award process. In judging the financial 
management systems of grant applicants the requirements set by the 
Office of Management and Budget (OMB) Circular A-110, ``Uniform 
Administrative Requirements for Grants and Agreements with Institutions 
of Higher Education, Hospitals and other Nonprofit Organizations,'' 
Attachment F, ``Standards for Financial Management Systems'' will apply, 
and by reference, OMB Circular A-122 ``Cost Principles for Nonprofit 
Organizations'' will also apply. The determination as to whether an 
applicant can conform to these requirements is made through a pre-grant 
award review which is the responsibility of the grant officer with 
information provided by the A.I.D. Inspector General.
    (2) Documentation requirement. The most recent audited financial 
statement including Balance Sheet, Statement of Support, Revenue and 
Expenditure and Statement of Change in Financial Position prepared in 
accordance with generally accepted accounting principles (``GAAP'') 
disclosing administrative, program, and fund-raising costs; and 
separately disclosing overseas program costs and sources and amounts of 
funds received for overseas programs. The audit shall be conducted by an 
independent Certified Public Accountant in accordance with the generally 
accepted auditing standards (``GAAS'') of the ``Statement on Auditing 
Standards'' of the American Institute of Certified Public Accountants. A 
budget for the year subsequent to that covered in the year reported in a 
format consistent with the audit, including the detailing of anticipated 
amounts and sources of support and revenue.
    (i) New organizations which have been incorporated less than a year 
must provide an independent CPA's statement that financial statements 
can be prepared in accordance with GAAP, along with an unaudited 
financial statement covering the period between incorporation and 
application for registration. The CPA's statement for new organizations 
will also indicate whether the organization has installed internal 
controls to enable the execution of an audit in accordance with the 
applicable auditing standards at the end of the first year of 
operations.
    (g) Condition and documentation requirement no. 7--(1) Condition. 
That the applicant has a Board of Directors which meets at least 
annually, whose members serve without compensation for such services, 
and that paid officers or staff members do not constitute a majority in 
any decision.
    (2) Documentation requirement. A statement indicating that paid 
officers

[[Page 655]]

or staff members who serve on the Board do not constitute a majority in 
any decision and members of the governing body receive no compensation 
for their services on that body; the names and addresses of members; and 
minutes of meetings or excerpts from minutes which demonstrate that the 
Board holds meetings at least annually.
    (h) Condition and documentation requirement no. 8--(1) Condition. 
That the applicant expends and distributes its funds and resources in 
accordance with the stated purposes of the organization, without 
unreasonable cost for salaries, promotion, publicity, fund raising and 
administration, at home or abroad, and provides public disclosure of its 
financial circumstances.
    (i) In determining whether an applicant obtains, expends, and 
distributes its funds without unreasonable cost for promotion, 
publicity, fund raising, and administration, A.I.D. shall consider fund 
raising costs as presumptively unreasonable if they exceed 20 percent of 
the total cash and in-kind contributions to the organization (as 
reflected in the audited financial statement).
    (ii) An applicant for registration or a registered agency whose fund 
raising costs exceed the 20 precent limitation must demonstrate that 
such costs are not unreasonable in light of the nature of the 
organization's operations. Upon such a showing, A.I.D. may permit 
exceptions to the 20 percent limitation on a case-by-case basis.
    (iii) Contributions as used in this section, include U.S. Government 
financial support, both cash and in-kind, as well as private support; 
similarly, it is expected that fund raising costs will include costs 
incurred in securing government contributions.
    (2) Documentation requirement. A certification that audited 
financial statements are available to the public upon request and a 
statement indicating salaries and allowances of the top five principal 
headquarters positions (determined by salary level) and country director 
positions. When provided directly by the applicant, salaries and/or 
allowances may be valued at actual cost; when provided by the recipient 
country or local institution, they may be valued at fair market value. 
Any other documentation or evidence which the applicant wishes to submit 
addressing the degree to which annual program spending has been 
consistent with the stated purposes of the organization and annual 
expenses are reasonable in amount.



Sec. 203.3  Annual requirements.

    In order to maintain its registration, each registered PVO shall 
submit annually, within 180 days after the close of the fiscal year, the 
following documents: An independently audited financial statement; a 
report of income and expenditures (A.I.D. Form 1550-2), which is 
relatable to the audited financial statements; an annual report (or 
similar document); a copy of IRS Form 990 or 990-PF; a budget for the 
new fiscal year; and a statement that all other circumstances described 
in the original registration material remain unchanged except as noted. 
A.I.D. may revise the above list of documents from time to time. In 
addition, each registrant shall submit such other information as A.I.D. 
may reasonably require to determine that the organization continues to 
meet the conditions of registration.



Sec. 203.4  Certificates of registration.

    Certificates of Registration will be issued by A.I.D. to applicants 
which A.I.D. finds satisfy the conditions and documentation requirements 
for registration set forth in Sec. 203.2.



Sec. 203.5  Denial of registration and reconsideration.

    (a) Notification of denial of registration. If A.I.D. decides to 
deny an applicant registration, the applicant will be informed in 
writing of the denial with a specific statement of those conditions and 
documentation requirements of registration in Sec. 203.2 that the 
applicant has failed to satisfy.
    (b) Reconsideration. An applicant may, within 30 days after receipt 
of a notification of denial of registration, request that A.I.D. 
reconsider its application for registration and may submit additional 
information to A.I.D. bearing on its suitability for registration. An 
applicant requesting reconsideration will be informed in writing of 
A.I.D.'s decision upon reconsideration.

[[Page 656]]

In addition, A.I.D. may, at its own discretion, reconsider a denial of 
registration at any time.
    (c) An applicant may resubmit an application for registration in 
accordance with Sec. 203.2 at any time.



Sec. 203.6  Registration of foreign private and voluntary organizations.

    (a) For the purpose of this part, foreign PVOs shall consist of the 
following:
    (1) An ``indigenous'' PVO is a non-U.S. PVO which conducts 
operations in the country under the laws of which it is organized.
    (2) A ``regional'' PVO is a non-U.S. PVO that is organized under the 
laws of a country in an A.I.D. geographic region, and conducts 
operations in more than one country in that region but not in more than 
one such region.
    (3) A ``third country'' PVO is a non-U.S. PVO which is not organized 
under the laws of any country in the A.I.D. geographic region or regions 
in which it conducts its operations.
    (4) An ``international'' PVO is an organization which is not 
registered as a U.S. PVO, receives funds from two or more countries, has 
an international governing body, and conducts operations in one or more 
A.I.D. geographic regions.
    (b) Foreign PVOs shall be registered in accordance with guidance for 
eligibility of non-U.S. private and voluntary organizations for 
participation in A.I.D.-supported programs approved by the Deputy 
Administrator of A.I.D., March 15, 1978 and A.I.D. handbooks, policies, 
regulations (published or otherwise) and procedures as they may be 
amended, supplemented or supported from time to time.



Sec. 203.7  Termination of registration.

    (a) Registration shall remain in force until: (1) Relinquished 
voluntarily by the registrant upon written notice to A.I.D.; or
    (2) Terminated by A.I.D. for failure of the registrant to fulfill 
and maintain the conditions of registration.
    (b) Termination proceedings pursuant to paragraph (a)(2) of this 
section shall include prior written notice to the registrant of the 
grounds for the proposed termination and opportunity for the registrant 
to file a written statement as to why its registration should not be 
terminated.



Sec. 203.8  Delegation of authority.

    (a) The authority to register and to terminate registrations is 
delegated to: (1) The Assistant Administrator for Food for Peace and 
Voluntary Assistance, or his/her designee for U.S., international, and 
third country PVOs.
    (2) The Regional Assistant Administrator, or their designees, for 
regional PVOs within their respective regions; and
    (3) The principal A.I.D. officer, or, if there is none, the United 
States Ambassador, or their designees, for indigenous PVOs.
    (b) Notices of registration and terminations of registration issued 
by the officials in paragraphs (a) (2) and (3) of this section will be 
forwarded to the Bureau for Food for Peace and Voluntary Assistance 
within 30 days for inclusion in the registry.



Sec. 203.9  Access to records.

    All records, reports, and other documents which are made available 
to A.I.D. pursuant to this part shall be made available for public 
inspection and copying pursuant to and under the procedures established 
by the public information regulation (22 CFR part 212) of the Agency for 
International Development.



Sec. 203.10  Waiver authority.

    The Administrator of the Agency for International Development or 
his/her designee may waive, withdraw, or amend from time to time, any or 
all of the provisions of the regulations in this part.



PART 204--HOUSING GUARANTY STANDARD TERMS AND CONDITIONS--Table of Contents




                         Subpart A--Definitions

Sec.
204.1  Definitions.

                         Subpart B--The Guaranty

204.11  The Guaranty.
204.12  Guaranty eligibility.
204.13  Non-impairment of the guaranty.

[[Page 657]]

204.14  Transferability of guaranty; Note Register.
204.15  Paying agent obligation.

             Subpart C--Procedure for Obtaining Compensation

204.21  Event of default; Application for compensation; Payment.
204.22  Right of A.I.D. to cure default.
204.23  Payment to A.I.D. of excess amounts received by the lender of 
          any assignee.

                          Subpart D--Covenants

204.31  Prosecution of claims.
204.32  Change in agreements.
204.33  A.I.D. approval of acceleration of notes.

                        Subpart E--Administration

204.41  Arbitration.
204.42  Notice.
204.43  Governing law.

Exhibit A--Application for compensation.
Exhibit B--Assignment.

    Authority:  22 U.S.C. 2381.

    Source:  53 FR 33805, Sept. 1, 1988, unless otherwise noted.



                         Subpart A--Definitions



Sec. 204.1  Definitions.

    Wherever used in these standard terms and conditions:
    (a) A.I.D. means the United States Agency for International 
Development or its successor with respect to the housing guaranty 
authorities contained in title III, chapter 2 of part I of the Foreign 
Assistance Act of 1961, as amended (the ``Act'').
    (b) Eligible Note(s) means (a) Note(s) meeting the eligiblity 
criteria set out in Sec. 204.12 hereof.
    (c) Eligible Investor means an ``eligible investor'' as defined in 
section 238(c) of the Act.
    (d) Lender means an Eligible Investor who initially provides loan 
funds to the Borrower in exchange for Eligible Note(s).
    (e) Investment respecting any Eligible Note means the principal 
amount of such Eligible Note.
    (f) Assignee means the owner of an Eligible Note who is registered 
as an Assignee on the Note Register of Eligible Notes required to be 
maintained by the Paying Agent and who is an ``Eligible Investor.''
    (g) Outstanding Investment respecting any Eligible Note means the 
Investment less the net amount of any repayments of principal of the 
Investment made by or on behalf of the Borrower or A.I.D.
    (h) Further Guaranteed Payments means the amount of any loss 
suffered by the Lender or by any Assignee by reason of the Borrower's 
failure to comply on a timely basis with any obligation it may have 
under an Eligible Note to indemnify and hold harmless the Lender and 
Assignee from taxes or governmental charges or any expense arising out 
of taxes or any other governmental charges relating to the Note in the 
country of the Borrower.
    (i) Loss of Investment respecting any Eligible Note means an amount 
in Dollars equal to the total of the (1) Outstanding Investment 
determined as of the Date of Application, (2) Further Guaranteed 
Payments unpaid as of the Date of Application, and (3) interest accrued 
at the rate(s) specified in the Note(s) and unpaid on the Outstanding 
Investment and Further Guaranteed Payments to and including the date on 
which full payment thereof is made to the Lender or any Assignee.
    (j) Application for Compensation means an executed application in 
the form of Exhibit A hereto which the Lender or any Assignee files with 
A.I.D. pursuant to Sec. 204.21 of this part.
    (k) Applicant means a Lender or Assignee who files an Application 
for Compensation with A.I.D.
    (l) Date of Application means the effective date of an Application 
for Compensation filed with A.I.D. pursuant to Sec. 204.21 of this part.
    (m) Business Day means a date on which banks of the District of 
Columbia of the United States of America are open for business.
    (n) Guaranty Payment Date means a Business Day not more than sixty 
(60) calendar days after the related Date of Application; provided that 
(1) compensation to the party filing the related Application for 
Compensation is due and payable on such date, in accordance with the 
terms of this Guaranty and (2) tender of assignment referred to

[[Page 658]]

in subsection 204.21(f) is made as therein provided.
[53 FR 33805, Sept. 1, 1988; 53 FR 39015, Oct. 4, 1988]



                         Subpart B--The Guaranty



Sec. 204.11  The Guaranty.

    Subject to these standard terms and conditions, the United States of 
America, acting through A.I.D., agrees to pay to any Lender or Assignee 
who has been determined to be an Eligible Investor compensation in 
Dollars equal to its Loss of Investment under the Eligible Note; 
provided, however, that no such payment shall be made for any such loss 
arising out of fraud or misrepresentation for which such Lender or 
Assignee is responsible or of which it had knowledge at the time it 
became such Lender or Assignee.

This Guaranty shall apply to each Eligible Note registered on the Note 
Register required to be maintained by the Paying Agent.



Sec. 204.12  Guaranty eligibility.

    (a) Eligible Notes only may be guarantied hereunder, and Eligible 
Investors only are entitled to the benefits of this Guaranty. Notes in 
order to achieve Eligible Note status must be signed on behalf of the 
Borrower, manually or in facsimile, by a duly authorized representative 
of the Borrower; and they must contain a guaranty legend incorporating 
these standard terms and conditions signed on behalf of A.I.D. by either 
a manual signature or a facsimile signature or an authorized 
representative of A.I.D. together with a certificate of authentication 
manually executed by a Paying Agent whose appointment by the Borrower is 
consented to by A.I.D. in a Paying and Transfer Agency Agreement.
    (b) A.I.D. shall designate in a certificate delivered to the Lender 
and to the Paying Agent, the person(s) whose signature shall be binding 
on A.I.D. The certificate of authentication of the Paying Agent issued 
pursuant to the Paying and Transfer Agency Agreement shall, when 
manually executed by the Paying Agent, be conclusive evidence binding on 
A.I.D. that the Note has been duly executed on behalf of the Borrower 
and delivered.



Sec. 204.13  Non-impairment of the guaranty.

    The full faith and credit of the United States of America is pledged 
to the performance of this Guaranty. The Guaranty shall not be affected 
or impaired by any defect in the authorization, execution, delivery or 
enforceability of any agreement or other document executed by the 
Lender, A.I.D., the Paying Agent or the Borrower in connection with the 
transactions contemplated by this Guaranty. This non-impairment of the 
guaranty provision shall not, however, be operative with respect to any 
amount arising out of fraud or misrepresentation for which the Lender or 
Assignee is responsible or of which it had knowledge prior to the time 
it became such Lender or Assignee.



Sec. 204.14  Transferability of guaranty; Note Register.

    The Lender of any Assignee may assign, transfer or pledge the 
Eligible Notes to any Eligible Investor. Any such assignment, transfer 
or pledge shall be effective on the date that the name of the new 
Assignee is entered on the Note Register required to be maintained by 
the Paying Agent pursuant to the Paying and Transfer Agency Agreement. 
A.I.D. shall be entitled to treat the persons in whose names the 
Eligible Notes are registered as the owners thereof for all purposes of 
this Guaranty and A.I.D. shall not be affected by notice to the 
contrary.



Sec. 204.15  Paying agent obligations.

    Failure of the Paying Agent to perform any of its obligations 
pursuant to the Paying and Transfer Agency Agreement shall not impair 
the Investor's or any Assignee's rights under this Contract of Guaranty, 
but may be the subject of action for damages against the Paying Agent by 
A.I.D. as a result of such failure or neglect; provided, however, that 
the Paying Agent is not authorized to issue and authenticate and have 
Notes outstanding at any time in excess of the principal amount of the 
Loan.

[[Page 659]]



             Subpart C--Procedure for Obtaining Compensation



Sec. 204.21  Event of default; Application for compensation; Payment.

    (a) Within one year after an Event of Default, as this term is 
defined in an Eligible Note, the Lender or Assignee may file with A.I.D. 
an Application for Compensation in form as provided in Exhibit A. A.I.D. 
shall make the required payment not later than sixty (60) days after the 
Date of Application unless A.I.D. has cured the default under 
Sec. 204.22.
    (b) Guaranty Payment. On or before the Guaranty Payment Date, the 
Applicant shall tender assignment of all Applicant's right, title and 
interest as of the Date of Application in and to all sums for which 
Application has been made. A.I.D. shall accept the assignment and pay or 
cause to be paid to Applicant and compensation due to the Applicant 
pursuant to the Guaranty.



Sec. 204.22  Right of A.I.D. to cure default.

    Within sixty (60) days after the Date of Application for 
Compensation, A.I.D. may at any time make payments to the Lender or any 
Assignee equal to all installments of principal due and unpaid under any 
Note (other than installments whose maturity has been accelerated), 
together with interest on the unpaid principal amount of the Note to the 
date of such payment by A.I.D., and any Further Guaranteed payments due 
and unpaid, and thereby prevent or cure any default under the Note. Upon 
such a payment by A.I.D., if the Lender or Assignee shall have 
accelerated such Note, such acceleration shall be immediately rescinded 
or, if such Note shall not have been accelerated, such Note shall not 
thereafter be accelerated as a result of such Event of Default.



Sec. 204.23  Payment to A.I.D. of excess amounts received by the lender of any assignee.

    If the Lender or Assignee shall, as a result of A.I.D. paying 
compensation under this Guaranty, receive an excess payment, it shall 
refund the excess to A.I.D.



                          Subpart D--Covenants



Sec. 204.31  Prosecution of claims.

    After an assignment to A.I.D. by the Lender or any Assignee pursuant 
to Sec. 204.21(b), A.I.D. shall have exclusive power to prosecute all 
claims related to the outstanding Eligible Notes so assigned. If the 
Lender or such Assignee continues to have an interest in the outstanding 
Eligible Notes, the Lender or such Assignee and A.I.D. shall consult 
with each other with respect to their respective interests in such 
Eligible Notes and the manner of and responsibility for prosecuting 
claims.



Sec. 204.32  Change in agreements.

    Neither the Lender nor any Assignee will consent to any change or 
waiver of any provision of any document contemplated by this Guaranty 
without the prior written consent of A.I.D.



Sec. 204.33  A.I.D. approval of acceleration of notes.

    Without the prior approval of A.I.D., the Lender or any Assignee 
shall not accelerate any Eligible Notes held by it on account of the 
happening of an Event of Default other than failure to make a payment 
when due on the note.



                        Subpart E--Administration



Sec. 204.41  Arbitration.

    Any controversy or claim between A.I.D. and the Lender or any 
Assignee arising out of this Guaranty shall be settled by arbitration to 
be held in Washington, DC in accordance with the then prevailing rules 
of the American Arbitration Association, and judgment on the award 
rendered by the arbitrators may be entered in any court of competent 
jurisdiction.



Sec. 204.42  Notice.

    Any communication to A.I.D. pursuant to this Guaranty shall be in 
writing in the English language, shall refer to the A.I.D. Housing 
Guaranty Project Number inscribed on the Eligible Note and shall be 
complete on the day it shall be actually received by A.I.D. at the 
address specified below:

Mail Address:

[[Page 660]]

  Office of Housing and Urban Programs, Agency for International 
Development, Washington, DC 20523.

  Re: A.I.D. Housing Guaranty Project ____-HG-____\1\
---------------------------------------------------------------------------


    \1\ Enter title and numerical designation of the relevant A.I.D. 
Housing Guaranty Project as inscribed on each Note guaranty legend.
---------------------------------------------------------------------------

Telex Nos.: ITT 440001 (Answer back is AIDWNDC) RCA 248379 (Answer back 
is 248379 AID UR) WU 892703 (Answer back is AID WSH) WU 64154 (Answer 
back is AID 64154)
Fax No.: 202/647-4958
Cable Address: AID WASH DC

Other addresses may be substituted for the above upon the giving of 
notice of such substitution to each Lender or Assignee by first class 
mail at the addresses set forth in the Note Register.



Sec. 204.43  Governing law.

    This Guaranty shall be governed by and construed in accordance with 
the laws of the United States of America governing contracts and 
commercial transactions of the United States Government.

                                Exhibit A

                      Application for Compensation

Office of Housing and Urban Programs, Agency for International 
          Development, International Development Cooperation Agency, 
          Washington, DC 20523
    Ref: Guaranty dated as of ____, 19____ A.I.D. Housing Project 
HG-________
Gentlemen:
    You are hereby advised that payment of $__________ (consisting of 
$__________ of principal, $__________ of interest and $__________ in 
Further Guaranteed Payments as defined in Section 204.01(i) of the 
Standard Terms and Conditions of the above-mentioned Guaranty \1\) was 
due on ________, 19____, on $________ principal amount of Notes held by 
the undersigned of the ____________ (the ``Borrower''), issued pursuant 
to the Loan Agreement, dated as of ______, ______, between the Borrower 
and ____________. Of such amount $__________ was not received on such 
date and has not been received by the undersigned at the date hereof. In 
accordance with the terms and provisions of the above-mentioned 
Guaranty, the undersigned hereby applies, under Section 204.21 of said 
Guaranty, for payment of a total of $____________, representing 
$____________, the outstanding principal amount of the presently 
outstanding Notes of the Borrower held by the undersigned issued 
pursuant to said Loan Agreement, and $____________ in Further Guaranteed 
Payments,\2\ plus accrued and unpaid interest thereon to and including 
the date payment in full is made by you pursuant to said Guaranty. Such 
payment is to be made at your office in Washington, DC.
---------------------------------------------------------------------------


    \1\ Strike inapplicable portion.

    \2\ In the event the Application for Compensation relates to Further 
Guaranteed Payments, such Application must also contain a statement of 
the nature and circumstances of the related loss.
---------------------------------------------------------------------------

[Name of Applicant]

 By_____________________________________________________________________

 Name___________________________________________________________________

 Title__________________________________________________________________

 Dated__________________________________________________________________

                                Exhibit B

                               Assignment

    The undersigned, being the registered owner of a Note in the 
principal amount of $____________ issued by the ____________ (the 
``Borrower''), pursuant ____________, and guaranty, dated as of ______, 
______ the ``Guaranty''), between the Lender and the United States of 
America, acting through the Agency for International Development 
(``A.I.D.''), hereby assigns to A.I.D., without recourse (i) its entire 
right, title and interest in and to the Note of the Borrower referred to 
above (which Note is attached hereto), including its rights to unpaid 
interest on such Note, and (ii) its entire outstanding right, title and 
interest arising out of said Loan Agreement with respect to such Note, 
except the undersigned's right to receive payments under the Loan 
Agreement in respect of which A.I.D. has made no payment to the 
undersigned as of the date hereof.

[Name of Applicant]

 By_____________________________________________________________________

 Name___________________________________________________________________

 Title__________________________________________________________________

 Dated__________________________________________________________________

Accepted:

UNITED STATES OF AMERICA
 By_____________________________________________________________________

 Name___________________________________________________________________

 Title__________________________________________________________________

 Dated__________________________________________________________________

[[Page 661]]



PART 205--PAYMENTS TO AND ON BEHALF OF PARTICIPANTS IN NONMILITARY ECONOMIC DEVELOPMENT TRAINING PROGRAMS--Table of Contents




Sec.
205.1  Per diem rates.
205.2  Monthly maintenance.
205.3  Other allowances paid to participants.
205.4  Tuition.
205.5  Health insurance.
205.6  Advance payment.
205.7  Additional authorization.

    Authority:  Sec. 636(a), Foreign Assistance Act of 1961, as amended 
(22 U.S.C. 2396).

    Source:  43 FR 58815, Dec. 18, 1978, unless otherwise noted.



205.1  Per diem rates.

    Participants in any training program under the Foreign Assistance 
Act of 1961 other than Part II may receive a per diem allowance in 
accordance with the following rates:
    (a) For participants in programs of training in the United States, a 
per diem rate not to exceed $40 or, in exceptional circumstances such 
other rates not to exceed $65 as the Administrator of the Agency for 
International Development or his designee may prescribe and such 
designee may be authorized to redelegate such authority. Per diem rates 
apply to participants in travel status. Those in academic or non-
academic residence status receive monthly rates. Per diem and monthly 
maintenance cannot be paid for the same period.
    (b) For participants in programs of training in countries other than 
the United States, a per diem allowance not to exceed those prescribed 
in the Standard Regulations (Government Civilian, Foreign Areas).



Sec. 205.2  Monthly maintenance.

    Academic participants enrolled in educational institutions for one 
quarter, semester, trimester, or longer will receive monthly 
maintenances in per diem at rates not to exceed those in Sec. 61.5 of 
this title. Participants in non-academic programs who remain in one city 
for more than thirty (30) days will also receive a monthly rate 
established by AID (DS/IT) in lieu of per diem.



Sec. 205.3  Other allowances paid to participants.

    Allowances for books, training equipment, costs connected with 
preparation of the Master's thesis and preparation and publication of 
the Doctoral dissertation and other necessary training expenses may be 
authorized for participants. These allowances will not exceed the 
maximums paid by ICA/CU to grantees in similar programs.



Sec. 205.4  Tuition.

    Normal institution-established tuition and related fees for approved 
courses of study will be paid by AID.



Sec. 205.5  Health insurance.

    Premiums for health and accident insurance established by the 
training institution or under AID contracts with insurance carriers will 
be paid by AID. In exceptional cases, in which the participant cannot 
meet medical expenses, AID, with appropriate approval, shall pay 
necessary medical expenses with appropriated funds.



Sec. 205.6  Advance payment.

    Per diem, monthly maintenance, and other allowances to participants 
may be paid in advance when necessary and appropriate.



Sec. 205.7  Additional authorization.

    Any emergency, unusual or additional payment deemed necessary for 
the satisfactory completion of program objectives if allowable under 
existing authority, whether or not specifically provided for by this 
part, may be authorized by the Assistant Administrator for Development 
Support.



PART 206--TESTIMONY BY EMPLOYEES AND THE PRODUCTION OF DOCUMENTS IN PROCEEDINGS WHERE A.I.D. IS NOT A PARTY--Table of Contents




Sec.
206.1  Purpose and scope.
206.2  Production or disclosure prohibited unless approved by the 
          General Counsel.
206.3  Procedure in the event of a demand for production or disclosure.
206.4  Procedure where a decision concerning a demand is not made prior 
          to the time a response to the demand is required.
206.5  Procedure in the event of an adverse

[[Page 662]]

          ruling.
206.6  Considerations in determining whether production or disclosure 
          should be made pursuant to a demand.

    Authority:  Sec. 621, Foreign Assistance Act of 1961, as amended, 75 
Stat. 424 (22 U.S.C. 2381).

    Source:  53 FR 24260, June 28, 1988, unless otherwise noted.



Sec. 206.1  Purpose and scope.

    (a) This part sets forth the procedures to be followed in 
proceedings in which the U.S. Agency for International Development (the 
``Agency'') is not a party, whenever a subpoena, order or other demand 
(collectively referred to as a ``demand'') of a court or other authority 
set forth in Sec. 206.1(d) of this part is issued for the production or 
disclosure of (1) any material contained in the files of the Agency, (2) 
any information relating to material contained in the files of the 
Agency, or (3) any information or material acquired by any person while 
such person was an employee of the Agency as a part of the performance 
of his official duties or because of his official status.
    (b) For purposes of this part, the term ``employee of the Agency'' 
includes all officers and employees of the Agency appointed by, or 
subject to the supervision, jurisdiction or control of, the 
Administrator of the Agency, including personal services contractors.
    (c) This part is intended to provide instructions regarding the 
internal operations of the Agency, and is not intended, and does not and 
may not be relied upon, to create any right or benefit, substantive or 
procedural, enforceable at law by a party against the Agency.
    (d) This part applies to:
    (1) State and local court, administrative and legislative 
proceedings.
    (2) Federal court and administrative proceedings.
    (e) This part does not apply to:
    (1) Congressional requests or subpoenas for testimony or documents.
    (2) Employees or former employees making appearances solely in their 
private capacity in legal or administrative proceedings that do not 
relate to the Agency (such as cases arising out of traffic accidents, 
domestic relations, etc.). Any question whether the appearance relates 
solely to the employee's or former employee's private capacity should be 
referred to the General Counsel or his designee.
    (f) Nothing in this part affects disclosure of information under the 
Freedom of Information Act, 5 U.S.C. 552, the Privacy Act, 5 U.S.C. 
552a. the Sunshine Act, 5 U.S.C. 552b, or the Agency's implementing 
regulations. Nothing in this part otherwise permits disclosure of 
information by the Agency except as is provided by statue or other 
applicable law.



Sec. 206.2  Production or disclosure prohibited unless approved by the General Counsel.

    No employee or former employee of the Agency shall, in response to a 
demand of a court or other authority set forth in Sec. 206.1(d), produce 
any material or disclose any information described in Sec. 206.1(a) 
without the approval of the General Counsel or his designee.



Sec. 206.3  Procedure in the event of a demand for production or disclosure.

    (a) Whenever an employee or former employee of the Agency receives a 
demand for the production of material or the disclosure of information 
described in Sec. 206.1(a), he shall immediately notify and provide a 
copy of the demand to the General Counsel or his designee. The General 
Counsel, or his designee, shall be furnished by the party causing the 
demand to be issued or served a written summary of the information 
sought, its relevance to the proceeding in connection with which it was 
served and why the information sought is unavailable by any other means 
or from any other sources.
    (b) The General Counsel, or his designee, in consultation with 
appripriate Agency officials, and in light of the considerations listed 
in Sec. 206.6, will determine whether the person on whom the demand was 
served should respond to the demand.
    (c) To the extent he deems it necessary or appropriate, the General 
Counsel, or his designee, may also require from the party causing such 
demand to be issued or served a plan of all reasonably foreseeable 
demands, including but not limited to names of all employees and former 
employees from

[[Page 663]]

whom discovery will be sought, areas of inquiry, length of time of 
proceedings requiring oral testimony and identification of documents to 
be used or whose production is sought.



Sec. 206.4  Procedure where a decision concerning a demand is not made prior to the time a response to the demand is required.

    If the response to the demand is required before the instructions 
from the General Counsel, or his designee, are received, an attorney 
designated by the Department of Justice for the purpose shall appear 
with the employee or former employee upon whom the demand has been made, 
and shall furnish the court or other authority with a copy of the 
regulations contained in this part and inform the court or other 
authority that the demand has been, or is being, as the case may be, 
referred for the prompt consideration of the General Counsel and shall 
respectfully request the court or other authority to stay the demand 
pending receipt of the requested instructions.



Sec. 206.5  Procedure in the event of an adverse ruling.

    If the court or other authority declines to stay the effect of the 
demand in response to a request made in accordance with Sec. 206.4 
pending receipt of instructions, or if the court or other authority 
rules that the demand must be complied with irrespective of instructions 
not to produce the material or disclose the information sought, the 
employuee or former employee upon whom the demand has been made shall 
respectfully decline to comply with the demand, citing this part and 
United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951).



Sec. 206.6  Considerations in determining whether production or disclosure should be made pursuant to a demand.

    (a) In deciding whether to make disclosures pursuant to a demand, 
the General Counsel, or his designee, may consider, among things:
    (1) Whether such disclosure is appropriate under the rules of 
procedure governing the case or matter in which the demand arose, and
    (2) Whether disclosure is appropriate under the relevant substantive 
law concerning privilege.
    (b) Among the demands in response to which disclosure will not be 
made are those demands with respect to which any of the following 
factors exist:
    (1) Disclosure would violate a statute or a rule of procedure,
    (2) Disclosure would violate a specific regulation,
    (3) Disclosure would reveal classified information, unless 
appropriately declassified by the originating agency,
    (4) Disclosure would reveal trade secrets or proprietary information 
without the owner's consent,
    (5) Disclosure would otherwise adversely affect the foreign policy 
interets of the United States or impair the foreign assistance program 
of the United States, or
    (6) Disclosure would impair an ongoing Inspector General or 
Department of Justice investigation.



PART 207--INDEMNIFICATION OF EMPLOYEES--Table of Contents






Sec. 207.01  Policy.

    (a) A.I.D. may indemnify, in whole or in part, its employees (which 
for the purpose of this regulation includes former employees) for any 
verdict, judgment or other monetary award which is rendered against any 
such employee, provided that the conduct giving rise to the verdict, 
judgment or award was taken within the scope of his or her employment 
with the Agency and that such indemnification is in the interest of the 
United States, as determined by the Administrator, or his or her 
designee, in his or her discretion.
    (b) A.I.D. may settle or compromise a personal damage claim against 
its employee by the payment of available funds, at any time, provided 
the alleged conduct giving rise to the personal damage claim was taken 
within the scope of employment and that such settlement or compromise is 
in the interest of the United States, as determined by the 
Administrator, or his or her designee, in his or her discretion.

[[Page 664]]

    (c) Absent exceptional circumstances, as determined by the 
Administrator or his or her designee, A.I.D. will not entertain a 
request either to agree to indemnify or to settle a personal damage 
claim before entry of an adverse verdict, judgment or monetary award.
    (d) When an employee becomes aware that an action has been filed 
against the employee in his or her individual capacity as a result of 
conduct taken within the scope of his or her employment, the employee 
should immediately notify A.I.D. that such an action is pending.
    (e) The employee may, thereafter, request either: (1) 
Indemnification to satisfy a verdict, judgment or award entered against 
the employee or (2) payment to satisfy the requirements of a settlement 
proposal. The employee shall submit a written request, with 
documentation including copies of the verdict, judgment, award or 
settlement proposal, as appropriate, to the General Counsel. The General 
Counsel may also seek the views of the Department of Justice. The 
General Counsel shall forward the request and the General Counsel's 
recommendation to the Administrator for decision.
    (f) Any payment under this part either to indemnify an employee or 
to settle a personal damage claim shall be contingent upon the 
availability of appropriated funds.
[53 FR 29658, Aug. 8, 1988]

(5 U.S.C. 301; 22 U.S.C. 2381(a))



PART 208--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)--Table of Contents




                           Subpart A--General

Sec.
208.100  Purpose.
208.105  Definitions.
208.110  Coverage.
208.115  Policy.

                       Subpart B--Effect of Action

208.200  Debarment or suspension.
208.205  Ineligible persons.
208.210  Voluntary exclusion.
208.215  Exception provision.
208.220  Continuation of covered transactions.
208.225  Failure to adhere to restrictions.

                          Subpart C--Debarment

208.300  General.
208.305  Causes for debarment.
208.310  Procedures.
208.311  Investigation and referral.
208.312  Notice of proposed debarment.
208.313  Opportunity to contest proposed debarment.
208.314  Debarring official's decision.
208.315  Settlement and voluntary exclusion.
208.320  Period of debarment.
208.325  Scope of debarment.

                          Subpart D--Suspension

208.400  General.
208.405  Causes for suspension.
208.410  Procedures.
208.411  Notice of suspension.
208.412  Opportunity to contest suspension.
208.413  Suspending official's decision.
208.415  Period of suspension.
208.420  Scope of suspension.

       Subpart E--Responsibilities of GSA, Agency and Participants

208.500  GSA responsibilities.
208.505  A.I.D. responsibility.
208.510  Participants' responsibilities.

          Subpart F--Drug-Free Workplace Requirements (Grants)

208.600  Purpose.
208.605  Definitions.
208.610  Coverage.
208.615  Grounds for suspension of payments, suspension or termination 
          of grants, or suspension or debarment.
208.620  Effect of violation.
208.625  Exception provision.
208.630  Certification requirements and procedures.
208.635  Reporting of and employee sanctions for convictions of criminal 
          drug offenses.

Appendix A to Part 208--Certification Regarding Debarment, Suspension, 
          and Other Responsibility Matters--Primary Covered Transactions
Appendix B to Part 208--Certification Regarding Debarment, Suspension, 
          Ineligibility and Voluntary Exclusion--Lower Tier Covered 
          Transactions
Appendix C to Part 208--Certification Regarding Drug-Free Workplace 
          Requirements

    Authority:  E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, title V, subtitle D; 41 U.S.C. 701 et

[[Page 665]]

seq.); Sec. 621, Foreign Assistance Act of 1961, 22 U.S.C. 2381.

    Source:  53 FR 19179 and 19204, May 26, 1988, unless otherwise 
noted.

    Cross Reference: See also Office of Management and Budget notices 
published at 55 FR 21679, May 25, 1990 and 60 FR 33036, June 26, 1995.



                           Subpart A--General



Sec. 208.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded from Federal 
financial and nonfinancial assistance and benefits under Federal 
programs and activities. Debarment or suspension of a participant in a 
program by one agency shall have governmentwide effect.
    (b) These regulations implement section 3 of E.O. 12549 and the 
guidelines promulgated by the Office of Management and Budget under 
section 6 of the E.O. by:
    (1) Prescribing the programs and activities that are covered by the 
governmentwide system;
    (2) Prescribing the governmentwide criteria and governmentwide 
minimum due process procedures that each agency shall use;
    (3) Providing for the listing of debarred and suspended 
participants, participants declared ineligible (see definition of 
``ineligible'' in Sec. 208.105), and participants who have voluntarily 
excluded themselves from participation in covered transactions;
    (4) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion; and
    (5) Offering such other guidance as necessary for the effective 
implementation and administration of the governmentwide system.
    (c) These regulations also implement Executive Order 12689 (3 CFR, 
1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 
2455, 108 Stat. 3327) by--
    (1) Providing for the inclusion in the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs all persons proposed for 
debarment, debarred or suspended under the Federal Acquisition 
Regulation, 48 CFR Part 9, subpart 9.4; persons against which 
governmentwide exclusions have been entered under this part; and persons 
determined to be ineligible; and
    (2) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion.
    (d) Although these regulations cover the listing of ineligible 
participants and the effect of such listing, they do not prescribe 
policies and procedures governing declarations of ineligibility.
[60 FR 33040, 33045, June 26, 1995]



Sec. 208.105  Definitions.

    The following definitions apply to this part:
    Adequate evidence. Information sufficient to support the reasonable 
belief that a particular act or omission has occurred.
    Affiliate. Persons are affiliates of each other if, directly or 
indirectly, either one controls or has the power to control the other, 
or, a third person controls or has the power to control both. Indicia of 
control include, but are not limited to: interlocking management or 
ownership, identity of interests among family members, shared facilities 
and equipment, common use of employees, or a business entity organized 
following the suspension or debarment of a person which has the same or 
similar management, ownership, or principal employees as the suspended, 
debarred, ineligible, or voluntarily excluded person.
    Agency. Any executive department, military department or defense 
agency or other agency of the executive branch, excluding the 
independent regulatory agencies.
    Civil judgment. The disposition of a civil action by any court of 
competent jurisdiction, whether entered by verdict, decision, 
settlement, stipulation, or otherwise creating a civil liability for the 
wrongful acts complained of; or a final determination of liability under 
the Program Fraud Civil Remedies Act of 1988 (31 U.S.C. 3801-12).
    Conviction. A judgment or conviction of a criminal offense by any 
court of

[[Page 666]]

competent jurisdiction, whether entered upon a verdict or a plea, 
including a plea of nolo contendere.
    Debarment. An action taken by a debarring official in accordance 
with these regulations to exclude a person from participating in covered 
transactions. A person so excluded is ``debarred.''
    Debarring official. An official authorized to impose debarment. The 
debarring official is either:
    (1) The agency head, or
    (2) An official designated by the agency head.
    (3) The A.I.D. debarring official is the Associate Assistant to the 
Administrator for Management (M/AAA/SER).
    Indictment. Indictment for a criminal offense. An information or 
other filing by competent authority charging a criminal offense shall be 
given the same effect as an indictment.
    Ineligible. Excluded from participation in Federal nonprocurement 
programs pursuant to a determination of ineligibility under statutory, 
executive order, or regulatory authority, other than Executive Order 
12549 and its agency implementing regulations; for exemple, excluded 
pursuant to the Davis-Bacon Act and its implementing regulations, the 
equal employment opportunity acts and executive orders, or the 
environmental protection acts and executive orders. A person is 
ineligible where the determination of ineligibility affects such 
person's eligibility to participate in more than one covered 
transaction.
    Legal proceedings. Any criminal proceeding or any civil judicial 
proceeding to which the Federal Government or a State or local 
government or quasi-governmental authority is a party. The term includes 
appeals from such proceedings.
    List of Parties Excluded from Federal Procurement and Nonprocurement 
Programs. A list compiled, maintained and distributed by the General 
Services Administration (GSA) containing the names and other information 
about persons who have been debarred, suspended, or voluntarily excluded 
under Executive Orders 12549 and 12689 and these regulations or 48 CFR 
part 9, subpart 9.4, persons who have been proposed for debarment under 
48 CFR part 9, subpart 9.4, and those persons who have been determined 
to be ineligible.
    Notice. A written communication served in person or sent by 
certified mail, return receipt requested, or its equivalent, to the last 
known address of a party, its identified counsel, its agent for service 
of process, or any partner, officer, director, owner, or joint venturer 
of the party. Notice, if undeliverable, shall be considered to have been 
received by the addressee five days after being properly sent to the 
last address known by the agency.
    Participant. Any person who submits a proposal for, enters into, or 
reasonably may be expected to enter into a covered transaction. This 
term also includes any person who acts on behalf of or is authorized to 
commit a participant in a covered transaction as an agent or 
representative of another participant.
    Person. Any individual, corporation, partnership, association, unit 
of government or legal entity, however organized, except: foreign 
governments or foreign governmental entities, public international 
organizations, foreign government owned (in whole or in part) or 
controlled entities, and entities consisting wholly or partially of 
foreign governments or foreign governmental entities.
    Preponderance of the evidence. Proof by information that, compared 
with that opposing it, leads to the conclusion that the fact at issue is 
more probably true than not.
    Principal. Officer, director, owner, partner, key employee, or other 
person within a participant with primary management or supervisory 
responsibilities; or a person who has a critical influence on or 
substantive control over a covered transaction, whether or not employed 
by the participant. Persons who have a critical influence on or 
substantive control over a covered transaction are:
    (1) Principal investigators.
    (2) [Reserved]
    Proposal. A solicited or unsolicited bid, application, request, 
invitation to consider or similar communication by or on behalf of a 
person seeking to participate or to receive a benefit, directly or 
indirectly, in or under a covered transaction.

[[Page 667]]

    Respondent. A person against whom a debarment or suspension action 
has been initiated.
    State. Any of the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, any territory or possession 
of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers that instrumentality to be an agency of the 
State government.
    Suspending official. An official authorized to impose suspension. 
The suspending official is either:
    (1) The agency head, or
    (2) An official designated by the agency head.
    (3) The A.I.D. suspending official is the Associate Assistant to the 
Administrator for Management (M/AAA/SER).
    Suspension. An action taken by a suspending official in accordance 
with these regulations that immediately excludes a person from 
participating in covered transactions for a temporary period, pending 
completion of an investigation and such legal, debarment, or Program 
Fraud Civil Remedies Act proceedings as may ensue. A person so excluded 
is ``suspended.''
    Voluntary exclusion or voluntarily excluded. A status of 
nonparticipation or limited participation in covered transactions 
assumed by a person pursuant to the terms of a settlement.
    (w) A.I.D. Agency for International Development.
[53 FR 19179 and 19204, May 26, 1988, as amended at 53 FR 19179, May 26, 
1988; 60 FR 33041 and 33045, June 26, 1995]



Sec. 208.110  Coverage.

    (a) These regulations apply to all persons who have participated, 
are currently participating or may reasonably be expected to participate 
in transactions under Federal nonprocurement programs. For purposes of 
these regulations such transactions will be referred to as ``covered 
transactions.''
    (1) Covered transaction. For purposes of these regulations, a 
covered transaction is a primary covered transaction or a lower tier 
covered transaction. Covered transactions at any tier need not involve 
the transfer of Federal funds.
    (i) Primary covered transaction. Except as noted in paragraph (a)(2) 
of this section, a primary covered transaction is any nonprocurement 
transaction between an agency and a person, regardless of type, 
including: grants, cooperative agreements, scholarships, fellowships, 
contracts of assistance, loans, loan guarantees, subsidies, insurance, 
payments for specified use, donation agreements and any other 
nonprocurement transactions between a Federal agency and a person. 
Primary covered transactions also include those transactions specially 
designated by the U.S. Department of Housing and Urban Development in 
such agency's regulations governing debarment and suspension.
    (ii) Lower tier covered transaction. A lower tier covered 
transaction is:
    (A) Any transaction between a participant and a person other than a 
procurement contract for goods or services, regardless of type, under a 
primary covered transaction.
    (B) Any procurement contract for goods or services between a 
participant and a person, regardless of type, expected to equal or 
exceed the Federal procurement small purchase threshold fixed at 10 
U.S.C. 2304(g) and 41 U.S.C. 253(g) (currently $25,000) under a primary 
covered transaction.
    (C) Any procurement contract for goods or services between a 
participant and a person under a covered transaction, regardless of 
amount, under which that person will have a critical influence on or 
substantive control over that covered transaction. Such persons are:
    (1) Principal investigators.
    (2) Providers of federally-required audit services.
    (2) Exceptions. The following transactions are not covered:
    (i) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;

[[Page 668]]

    (ii) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, entities 
consisting wholly or partially of foreign governments or foreign 
governmental entities;
    (iii) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (iv) Federal employment;
    (v) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (vi) Incidental benefits derived from ordinary governmental 
operations; and
    (vii) Other transactions where the application of these regulations 
would be prohibited by law.
    (b) Relationship to other sections. This section describes the types 
of transactions to which a debarment or suspension under the regulations 
will apply. Subpart B, ``Effect of Action,'' Sec. 208.200, ``Debarment 
or suspension,'' sets forth the consequences of a debarment or 
suspension. Those consequences would obtain only with respect to 
participants and principals in the covered transactions and activities 
described in Sec. 208.110(a). Sections 208.325, ``Scope of debarment,'' 
and 208.420, ``Scope of suspension,'' govern the extent to which a 
specific participant or organizational elements of a participant would 
be automatically included within a debarment or suspension action, and 
the conditions under which affiliates or persons associated with a 
participant may also be brought within the scope of the action.
    (c) Relationship to Federal procurement activities. In accordance 
with E.O. 12689 and section 2455 of Public Law 103-355, any debarment, 
suspension, proposed debarment or other governmentwide exclusion 
initiated under the Federal Acquisition Regulation (FAR) on or after 
August 25, 1995 shall be recognized by and effective for Executive 
Branch agencies and participants as an exclusion under this regulation. 
Similarly, any debarment, suspension or other governmentwide exclusion 
initiated under this regulation on or after August 25, 1995 shall be 
recognized by and effective for those agencies as a debarment or 
suspension under the FAR.
[53 FR 19179, 19204, May 26, 1988, as amended at 60 FR 33041, 33045, 
June 26, 1995]



Sec. 208.115  Policy.

    (a) In order to protect the public interest, it is the policy of the 
Federal Government to conduct business only with responsible persons. 
Debarment and suspension are discretionary actions that, taken in 
accordance with Executive Order 12549 and these regulations, are 
appropriate means to implement this policy.
    (b) Debarment and suspension are serious actions which shall be used 
only in the public interest and for the Federal Government's protection 
and not for purposes of punishment. Agencies may impose debarment or 
suspension for the causes and in accordance with the procedures set 
forth in these regulations.
    (c) When more than one agency has an interest in the proposed 
debarment or suspension of a person, consideration shall be given to 
designating one agency as the lead agency for making the decision. 
Agencies are encouraged to establish methods and procedures for 
coordinating their debarment or suspension actions.



                       Subpart B--Effect of Action



Sec. 208.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited by 
law, persons who are debarred or suspended shall be excluded from 
primary covered transactions as either participants or principals 
throughout the Executive Branch of the Federal Government for the period 
of their debarment, suspension, or the period they are proposed for 
debarment under 48 CFR part 9, subpart 9.4. Accordingly, no agency shall 
enter into primary covered transactions with such excluded persons 
during such period, except as permitted pursuant to Sec. 208.215.
    (b) Lower tier covered transactions. Except to the extent prohibited 
by law, persons who have been proposed for debarment under 48 CFR part 
9, subpart

[[Page 669]]

9.4, debarred or suspended shall be excluded from participating as 
either participants or principals in all lower tier covered transactions 
(see Sec. 208.110(a)(1)(ii)) for the period of their exclusion.
    (c) Exceptions. Debarment or suspension does not affect a person's 
eligibility for--
    (1) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (2) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, and 
entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (3) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (4) Federal employment;
    (5) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (6) Incidental benefits derived from ordinary governmental 
operations; and
    (7) Other transactions where the application of these regulations 
would be prohibited by law.
[60 FR 33041, 33045, June 26, 1995]



Sec. 208.205  Ineligible persons.

    Persons who are ineligible, as defined in Sec. 208.105(i), are 
excluded in accordance with the applicable statutory, executive order, 
or regulatory authority.



Sec. 208.210  Voluntary exclusion.

    Persons who accept voluntary exclusions under Sec. 208.315 are 
excluded in accordance with the terms of their settlements. A.I.D. 
shall, and participants may, contact the original action agency to 
ascertain the extent of the exclusion.



Sec. 208.215  Exception provision.

    Peace Corps may grant an exception permitting a debarred, suspended, 
or voluntarily excluded person, or a person proposed for debarment under 
48 CFR part 9, subpart 9.4, to participate in a particular covered 
transaction upon a written determination by the agency head or an 
authorized designee stating the reason(s) for deviating from the 
Presidential policy established by Executive Order 12549 and 
Sec. 208.200. However, in accordance with the President's stated 
intention in the Executive Order, exceptions shall be granted only 
infrequently. Exceptions shall be reported in accordance with 
Sec. 208.505(a).
[60 FR 33041, 33045, June 26, 1995]



Sec. 208.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency, agencies and 
participants may continue covered transactions in existence at the time 
the person was debarred, suspended, proposed for debarment under 48 CFR 
part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A 
decision as to the type of termination action, if any, to be taken 
should be made only after thorough review to ensure the propriety of the 
proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who is 
debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 
9.4, ineligible or voluntary excluded, except as provided in 
Sec. 208.215.
[60 FR 33041, 33045, June 26, 1995]



Sec. 208.225  Failure to adhere to restrictions.

    (a) Except as permitted under Sec. 208.215 or Sec. 208.220, a 
participant shall not knowingly do business under a covered transaction 
with a person who is--
    (1) Debarred or suspended;
    (2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
    (3) Ineligible for or voluntarily excluded from the covered 
transaction.
    (b) Violation of the restriction under paragraph (a) of this section 
may result in disallowance of costs, annulment or termination of award, 
issuance

[[Page 670]]

of a stop work order, debarment or suspension, or other remedies as 
appropriate.
    (c) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, proposed for debarment under 48 
CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the 
covered transaction (See appendix B of these regulations), unless it 
knows that the certification is erroneous. An agency has the burden of 
proof that a participant did knowingly do business with a person that 
filed an erroneous certification.
[60 FR 33041, 33045, June 26, 1995]



                          Subpart C--Debarment



Sec. 208.300  General.

    The debarring official may debar a person for any of the causes in 
Sec. 208.305, using procedures established in Secs. 208.310 through 
208.314. The existence of a cause for debarment, however, does not 
necessarily require that the person be debarred; the seriousness of the 
person's acts or omissions and any mitigating factors shall be 
considered in making any debarment decision.



Sec. 208.305  Causes for debarment.

    Debarment may be imposed in accordance with the provisions of 
Secs. 208.300 through 208.314 for:
    (a) Conviction of or civil judgment for:
    (1) Commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public or private 
agreement or transaction;
    (2) Violation of Federal or State antitrust statutes, including 
those proscribing price fixing between competitors, allocation of 
customers between competitors, and bid rigging;
    (3) Commission of embezzlement, theft, forgery, bribery, 
falsification or destruction of records, making false statements, 
receiving stolen property, making false claims, or obstruction of 
justice; or
    (4) Commission of any other offense indicating a lack of business 
integrity or business honesty that seriously and directly affects the 
present responsibility of a person.
    (b) Violation of the terms of a public agreement or transaction so 
serious as to affect the integrity of an agency program, such as:
    (1) A willful failure to perform in accordance with the terms of one 
or more public agreements or transactions;
    (2) A history of failure to perform or of unsatisfactory performance 
of one or more public agreements or transactions; or
    (3) A willful violation of a statutory or regulatory provision or 
requirement applicable to a public agreement or transaction.
    (c) Any of the following causes:
    (1) A nonprocurement debarment by any Federal agency taken before 
October 1, 1988, the effective date of these regulations, or a 
procurement debarment by any Federal agency taken pursuant to 48 CFR 
subpart 9.4;
    (2) Knowingly doing business with a debarred, suspended, ineligible, 
or voluntarily excluded person, in connection with a covered 
transaction, except as permitted in Sec. 208.215 or Sec. 208.220;
    (3) Failure to pay a single substantial debt, or a number of 
outstanding debts (including disallowed costs and overpayments, but not 
including sums owed the Federal Government under the Internal Revenue 
Code) owed to any Federal agency or instrumentality, provided the debt 
is uncontested by the debtor or, if contested, provided that the 
debtor's legal and administrative remedies have been exhausted;
    (4) Violation of a material provision of a voluntary exclusion 
agreement entered into under Sec. 208.315 or of any settlement of a 
debarment or suspension action; or
    (5) Violation of any requirement of subpart F of this part, relating 
to providing a drug-free workplace, as set forth in Sec. 208.615 of this 
part.
    (d) Any other cause of so serious or compelling a nature that it 
affects the present responsibility of a person.
[53 FR 19179 and 19204, May 26, 1988, as amended at 54 FR 4955, Jan. 31, 
1989]

[[Page 671]]



Sec. 208.310  Procedures.

    A.I.D. shall process debarment actions as informally as practicable, 
consistent with the principles of fundamental fairness, using the 
procedures in Secs. 208.311 through 208.314.



Sec. 208.311  Investigation and referral.

    Information concerning the existence of a cause for debarment from 
any source shall be promptly reported, investigated, and referred, when 
appropriate, to the debarring official for consideration. After 
consideration, the debarring official may issue a notice of proposed 
debarment.



Sec. 208.312  Notice of proposed debarment.

    A debarment proceeding shall be initiated by notice to the 
respondent advising:
    (a) That debarment is being considered;
    (b) Of the reasons for the proposed debarment in terms sufficient to 
put the respondent on notice of the conduct or transaction(s) upon which 
it is based;
    (c) Of the cause(s) relied upon under Sec. 208.305 for proposing 
debarment;
    (d) Of the provisions of Secs. 208.311 through 208.314, and any 
other A.I.D. procedures, if applicable, governing debarment 
decisionmaking; and
    (e) Of the potential effect of a debarment.



Sec. 208.313  Opportunity to contest proposed debarment.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of proposed debarment, the respondent may submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment.
    (b) Additional proceedings as to disputed material facts. (1) In 
actions not based upon a conviction or civil judgment, if the debarring 
official finds that the respondent's submission in opposition raises a 
genuine dispute over facts material to the proposed debarment, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents.
    (2) A transcribed record of any additional proceedings shall be made 
available at cost to the respondent, upon request, unless the respondent 
and the agency, by mutual agreement, waive the requirement for a 
transcript.



Sec. 208.314  Debarring official's decision.

    (a) No additional proceedings necessary. In actions based upon a 
conviction or civil judgment, or in which there is no genuine dispute 
over material facts, the debarring official shall make a decision on the 
basis of all the information in the administrative record, including any 
submission made by the respondent. The decision shall be made within 45 
days after receipt of any information and argument submitted by the 
respondent, unless the debarring official extends this period for good 
cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The debarring 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The debarring official may refer disputed material facts to 
another official for findings of fact. The debarring official may reject 
any such findings, in whole or in part, only after specifically 
determining them to be arbitrary and capricious or clearly erroneous.
    (3) The debarring official's decision shall be made after the 
conclusion of the proceedings with respect to disputed facts.
    (c) (1) Standard of proof. In any debarment action, the cause for 
debarment must be established by a preponderance of the evidence. Where 
the proposed debarment is based upon a conviction or civil judgment, the 
standard shall be deemed to have been met.
    (2) Burden of proof. The burden of proof is on the agency proposing 
debarment.
    (d) Notice of debarring official's decision. (1) If the debarring 
official decides to impose debarment, the respondent shall be given 
prompt notice:
    (i) Referring to the notice of proposed debarment;

[[Page 672]]

    (ii) Specifying the reasons for debarment;
    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the Federal Government 
unless an agency head or an authorized designee makes the determination 
referred to in Sec. 208.215.
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision not 
to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.



Sec. 208.315  Settlement and voluntary exclusion.

    (a) When in the best interest of the Government, A.I.D. may, at any 
time, settle a debarment or suspension action.
    (b) If a participant and the agency agree to a voluntary exclusion 
of the participant, such voluntary exclusion shall be entered on the 
Nonprocurement List (see subpart E).



Sec. 208.320  Period of debarment.

    (a) Debarment shall be for a period commensurate with the 
seriousness of the cause(s). If a suspension precedes a debarment, the 
suspension period shall be considered in determining the debarment 
period.
    (1) Debarment for causes other than those related to a violation of 
the requirements of subpart F of this part generally should not exceed 
three years. Where circumstances warrant, a longer period of debarment 
may be imposed.
    (2) In the case of a debarment for a violation of the requirements 
of Subpart F of this part (see Sec. 208.305(c)(5)), the period of 
debarment shall not exceed five years.
    (b) The debarring official may extend an existing debarment for an 
additional period, if that official determines that an extension is 
necessary to protect the public interest. However, a debarment may not 
be extended solely on the basis of the facts and circumstances upon 
which the initial debarment action was based. If debarment for an 
additional period is determined to be necessary, the procedures of 
Secs. 208.311 through 208.314 shall be followed to extend the debarment.
    (c) The respondent may request the debarring official to reverse the 
debarment decision or to reduce the period or scope of debarment. Such a 
request shall be in writing and supported by documentation. The 
debarring official may grant such a request for reasons including, but 
not limited to:
    (1) Newly discovered material evidence;
    (2) Reversal of the conviction or civil judgment upon which the 
debarment was based;
    (3) Bona fide change in ownership or management;
    (4) Elimination of other causes for which the debarment was imposed; 
or
    (5) Other reasons the debarring official deems appropriate.
[53 FR 19179 and 19204, May 26, 1988, as amended at 54 FR 4955, Jan. 31, 
1989]



Sec. 208.325  Scope of debarment.

    (a) Scope in general. (1) Debarment of a person under these 
regulations constitutes debarment of all its divisions and other 
organizational elements from all covered transactions, unless the 
debarment decision is limited by its terms to one or more specifically 
identified individuals, divisions or other organizational elements or to 
specific types of transactions.
    (2) The debarment action may include any affiliate of the 
participant that is specifically named and given notice of the proposed 
debarment and an opportunity to respond (see Secs. 208.311 through 
208.314).
    (b) Imputing conduct. For purposes of determining the scope of 
debarment, conduct may be imputed as follows:
    (1) Conduct imputed to participant. The fraudulent, criminal or 
other seriously improper conduct of any officer, director, shareholder, 
partner, employee, or other individual associated with a participant may 
be imputed to the participant when the conduct occurred in connection 
with the individual's performance of duties for or on behalf of the 
participant, or with the participant's knowledge, approval, or 
acquiescence. The participant's acceptance of the benefits derived from 
the conduct shall

[[Page 673]]

be evidence of such knowledge, approval, or acquiescence.
    (2) Conduct imputed to individuals associated with participant. The 
fraudulent, criminal, or other seriously improper conduct of a 
participant may be imputed to any officer, director, shareholder, 
partner, employee, or other individual associated with the participant 
who participated in, knew of, or had reason to know of the participant's 
conduct.
    (3) Conduct of one participant imputed to other participants in a 
joint venture. The fraudulent, criminal, or other seriously improper 
conduct of one participant in a joint venture, grant pursuant to a joint 
application, or similar arrangement may be imputed to other participants 
if the conduct occurred for or on behalf of the joint venture, grant 
pursuant to a joint application, or similar arrangement may be imputed 
to other participants if the conduct occurred for or on behalf of the 
joint venture, grant pursuant to a joint application, or similar 
arrangement or with the knowledge, approval, or acquiescence of these 
participants. Acceptance of the benefits derived from the conduct shall 
be evidence of such knowledge, approval, or acquiescence.



                          Subpart D--Suspension



Sec. 208.400  General.

    (a) The suspending official may suspend a person for any of the 
causes in Sec. 208.405 using procedures established in Secs. 208.410 
through 208.413.
    (b) Suspension is a serious action to be imposed only when:
    (1) There exists adequate evidence of one or more of the causes set 
out in Sec. 208.405, and
    (2) Immediate action is necessary to protect the public interest.
    (c) In assessing the adequacy of the evidence, the agency should 
consider how much information is available, how credible it is given the 
circumstances, whether or not important allegations are corroborated, 
and what inferences can reasonably be drawn as a result. This assessment 
should include an examination of basic documents such as grants, 
cooperative agreements, loan authorizations, and contracts.



Sec. 208.405.  Causes for suspension.

    (a) Suspension may be imposed in accordance with the provisions of 
Secs. 208.400 through 208.413 upon adequate evidence:
    (1) To suspect the commission of an offense listed in 
Sec. 208.305(a); or
    (2) That a cause for debarment under Sec. 208.305 may exist.
    (b) Indictment shall constitute adequate evidence for purposes of 
suspension actions.



Sec. 208.410  Procedures.

    (a) Investigation and referral. Information concerning the existence 
of a cause for suspension from any source shall be promptly reported, 
investigated, and referred, when appropriate, to the suspending official 
for consideration. After consideration, the suspending official may 
issue a notice of suspension.
    (b) Decisionmaking process. A.I.D. shall process suspension actions 
as informally as practicable, consistent with principles of fundamental 
fairness, using the procedures in Secs. 208.411 through 208.413.



Sec. 208.411  Notice of suspension.

    When a respondent is suspended, notice shall immediately be given:
    (a) That suspension has been imposed;
    (b) That the suspension is based on an indictment, conviction, or 
other adequate evidence that the respondent has committed irregularities 
seriously reflecting on the propriety of further Federal Government 
dealings with the respondent;
    (c) Describing any such irregularities in terms sufficient to put 
the respondent on notice without disclosing the Federal Government's 
evidence;
    (d) Of the cause(s) relied upon under Sec. 208.405 for imposing 
suspension;
    (e) That the suspension is for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings;
    (f) Of the provisions of Secs. 208.411 through 208.413 and any other 
A.I.D. procedures, if applicable, governing suspension decisionmaking; 
and
    (g) Of the effect of the suspension.

[[Page 674]]



Sec. 208.412  Opportunity to contest suspension.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of suspension, the respondent may submit, in person, in writing, 
or through a representative, information and argument in opposition to 
the suspension.
    (b) Additional proceedings as to disputed material facts. (1) If the 
suspending official finds that the respondent's submission in opposition 
raises a genuine dispute over facts material to the suspension, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents, unless:
    (i) The action is based on an indictment, conviction or civil 
judgment, or
    (ii) A determination is made, on the basis of Department of Justice 
advice, that the substantial interests of the Federal Government in 
pending or contemplated legal proceedings based on the same facts as the 
suspension would be prejudiced.
    (2) A transcribed record of any additional proceedings shall be 
prepared and made available at cost to the respondent, upon request, 
unless the respondent and the agency, by mutual agreement, waive the 
requirement for a transcript.



Sec. 208.413  Suspending official's decision.

    The suspending official may modify or terminate the suspension (for 
example, see Sec. 208.320(c) for reasons for reducing the period or 
scope of debarment) or may leave it in force. However, a decision to 
modify or terminate the suspension shall be without prejudice to the 
subsequent imposition of suspension by any other agency or debarment by 
any agency. The decision shall be rendered in accordance with the 
following provisions:
    (a) No additional proceedings necessary. In actions: based on an 
indictment, conviction, or civil judgment; in which there is no genuine 
dispute over material facts; or in which additional proceedings to 
determine disputed material facts have been denied on the basis of 
Department of Justice advice, the suspending official shall make a 
decision on the basis of all the information in the administrative 
record, including any submission made by the respondent. The decision 
shall be made within 45 days after receipt of any information and 
argument submitted by the respondent, unless the suspending official 
extends this period for good cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The suspending 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The suspending official may refer matters involving disputed 
material facts to another official for findings of fact. The suspending 
official may reject any such findings, in whole or in part, only after 
specifically determining them to be arbitrary or capricious or clearly 
erroneous.
    (c) Notice of suspending official's decision. Prompt written notice 
of the suspending official's decision shall be sent to the respondent.



Sec. 208.415  Period of suspension.

    (a) Suspension shall be for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings, unless terminated sooner by the 
suspending official or as provided in paragraph (b) of this section.
    (b) If legal or administrative proceedings are not initiated within 
12 months after the date of the suspension notice, the suspension shall 
be terminated unless an Assistant Attorney General or United States 
Attorney requests its extension in writing, in which case it may be 
extended for an additional six months. In no event may a suspension 
extend beyond 18 months, unless such proceedings have been initiated 
within that period.
    (c) The suspending official shall notify the Department of Justice 
of an impending termination of a suspension, at least 30 days before the 
12-month period expires, to give that Department an opportunity to 
request an extension.

[[Page 675]]



Sec. 208.420  Scope of suspension.

    The scope of a suspension is the same as the scope of a debarment 
(see Sec. 208.325), except that the procedures of Secs. 208.410 through 
208.413 shall be used in imposing a suspension.



       Subpart E--Responsibilities of GSA, Agency and Participants



Sec. 208.500  GSA responsibilities.

    (a) In accordance with the OMB guidelines, GSA shall compile, 
maintain, and distribute a list of all persons who have been debarred, 
suspended, or voluntarily excluded by agencies under Executive Order 
12549 and these regulations, and those who have been determined to be 
ineligible.
    (b) At a minimum, this list shall indicate:
    (1) The names and addresses of all debarred, suspended, ineligible, 
and voluntarily excluded persons, in alphabetical order, with cross-
references when more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for each listing; and
    (6) The agency and name and telephone number of the agency point of 
contact for the action.



Sec. 208.505  A.I.D. responsibilities.

    (a) The agency shall provide GSA with current information concerning 
debarments, suspension, determinations of ineligibility, and voluntary 
exclusions it has taken. Until February 18, 1989, the agency shall also 
provide GSA and OMB with information concerning all transactions in 
which A.I.D. has granted exceptions under Sec. 208.215 permitting 
participation by debarred, suspended, or voluntarily excluded persons.
    (b) Unless an alternative schedule is agreed to by GSA, the agency 
shall advise GSA of the information set forth in Sec. 208.500(b) and of 
the exceptions granted under Sec. 208.215 within five working days after 
taking such actions.
    (c) The agency shall direct inquiries concerning listed persons to 
the agency that took the action.
    (d) Agency officials shall check the Nonprocurement List before 
entering covered transactions to determine whether a participant in a 
primary transaction is debarred, suspended, ineligible, or voluntarily 
excluded (Tel. ).
    (e) Agency officials shall check the Nonprocurement List before 
approving principals or lower tier participants where agency approval of 
the principal or lower tier participant is required under the terms of 
the transaction, to determine whether such principals or participants 
are debarred, suspended, ineligible, or voluntarily excluded.



Sec. 208.510  Participants' responsibilities.

    (a) Certification by participants in primary covered transactions. 
Each participant shall submit the certification in appendix A to this 
part for it and its principals at the time the participant submits its 
proposal in connection with a primary covered transaction, except that 
States need only complete such certification as to their principals. 
Participants may decide the method and frequency by which they determine 
the eligibility of their principals. In addition, each participant may, 
but is not required to, check the Nonprocurement List for its principals 
(Tel. ). Adverse information on the certification will not necessarily 
result in denial of participation. However, the certification, and any 
additional information pertaining to the certification submitted by the 
participant, shall be considered in the administration of covered 
transactions.
    (b) Certification by participants in lower tier covered 
transactions. (1) Each participant shall require participants in lower 
tier covered transactions to include the certification in appendix B to 
this part for it and its principals in any proposal submitted in 
connection with such lower tier covered transactions.
    (2) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, ineligible, or voluntarily 
excluded from the covered

[[Page 676]]

transaction by any Federal agency, unless it knows that the 
certification is erroneous. Participants may decide the method and 
frequency by which they determine the eligiblity of their principals. In 
addition, a participant may, but is not required to, check the 
Nonprocurement List for its principals and for participants (Tel. ).
    (c) Changed circumstances regarding certification. A participant 
shall provide immediate written notice to A.I.D. if at any time the 
participant learns that its certification was erroneous when submitted 
or has become erroneous by reason of changed circumstances. Participants 
in lower tier covered transactions shall provide the same updated notice 
to the participant to which it submitted its proposals.



          Subpart F--Drug-Free Workplace Requirements (Grants)

    Source:  55 FR 21688, 21694, May 25, 1990, unless otherwise noted.



Sec. 208.600  Purpose.

    (a) The purpose of this subpart is to carry out the Drug-Free 
Workplace Act of 1988 by requiring that--
    (1) A grantee, other than an individual, shall certify to the agency 
that it will provide a drug-free workplace;
    (2) A grantee who is an individual shall certify to the agency that, 
as a condition of the grant, he or she will not engage in the unlawful 
manufacture, distribution, dispensing, possession or use of a controlled 
substance in conducting any activity with the grant.
    (b) Requirements implementing the Drug-Free Workplace Act of 1988 
for contractors with the agency are found at 48 CFR subparts 9.4, 23.5, 
and 52.2.



Sec. 208.605  Definitions.

    (a) Except as amended in this section, the definitions of 
Sec. 208.105 apply to this subpart.
    (b) For purposes of this subpart--
    (1) Controlled substance means a controlled substance in schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812), and as 
further defined by regulation at 21 CFR 1308.11 through 1308.15;
    (2) Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    (3) Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    (4) Drug-free workplace means a site for the performance of work 
done in connection with a specific grant at which employees of the 
grantee are prohibited from engaging in the unlawful manufacture, 
distribution, dispensing, possession, or use of a controlled substance;
    (5) Employee means the employee of a grantee directly engaged in the 
performance of work under the grant, including:
    (i) All direct charge employees;
    (ii) All indirect charge employees, unless their impact or 
involvement is insignificant to the performance of the grant; and,
    (iii) Temporary personnel and consultants who are directly engaged 
in the performance of work under the grant and who are on the grantee's 
payroll.

This definition does not include workers not on the payroll of the 
grantee (e.g., volunteers, even if used to meet a matching requirement; 
consultants or independent contractors not on the payroll; or employees 
of subrecipients or subcontractors in covered workplaces);
    (6) Federal agency or agency means any United States executive 
department, military department, government corporation, government 
controlled corporation, any other establishment in the executive branch 
(including the Executive Office of the President), or any independent 
regulatory agency;
    (7) Grant means an award of financial assistance, including a 
cooperative agreement, in the form of money, or property in lieu of 
money, by a Federal agency directly to a grantee. The term grant 
includes block grant and entitlement grant programs, whether or not 
exempted from coverage under the

[[Page 677]]

grants management government-wide common rule on uniform administrative 
requirements for grants and cooperative agreements. The term does not 
include technical assistance that provides services instead of money, or 
other assistance in the form of loans, loan guarantees, interest 
subsidies, insurance, or direct appropriations; or any veterans' 
benefits to individuals, i.e., any benefit to veterans, their families, 
or survivors by virtue of the service of a veteran in the Armed Forces 
of the United States;
    (8) Grantee means a person who applies for or receives a grant 
directly from a Federal agency (except another Federal agency);
    (9) Individual means a natural person;
    (10) State means any of the States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers the instrumentality to be an agency of the 
State government.



Sec. 208.610  Coverage.

    (a) This subpart applies to any grantee of the agency.
    (b) This subpart applies to any grant, except where application of 
this subpart would be inconsistent with the international obligations of 
the United States or the laws or regulations of a foreign government. A 
determination of such inconsistency may be made only by the agency head 
or his/her designee.
    (c) The provisions of subparts A, B, C, D and E of this part apply 
to matters covered by this subpart, except where specifically modified 
by this subpart. In the event of any conflict between provisions of this 
subpart and other provisions of this part, the provisions of this 
subpart are deemed to control with respect to the implementation of 
drug-free workplace requirements concerning grants.



Sec. 208.615  Grounds for suspension of payments, suspension or termination of grants, or suspension or debarment.

    A grantee shall be deemed in violation of the requirements of this 
subpart if the agency head or his or her official designee determines, 
in writing, that--
    (a) The grantee has made a false certification under Sec. 208.630;
    (b) With respect to a grantee other than an individual--
    (1) The grantee has violated the certification by failing to carry 
out the requirements of paragraphs (A)(a)-(g) and/or (B) of the 
certification (Alternate I to Appendix C) or
    (2) Such a number of employees of the grantee have been convicted of 
violations of criminal drug statutes for violations occurring in the 
workplace as to indicate that the grantee has failed to make a good 
faith effort to provide a drug-free workplace.
    (c) With respect to a grantee who is an individual--
    (1) The grantee has violated the certification by failing to carry 
out its requirements (Alternate II to Appendix C); or
    (2) The grantee is convicted of a criminal drug offense resulting 
from a violation occurring during the conduct of any grant activity.



Sec. 208.620  Effect of violation.

    (a) In the event of a violation of this subpart as provided in 
Sec. 208.615, and in accordance with applicable law, the grantee shall 
be subject to one or more of the following actions:
    (1) Suspension of payments under the grant;
    (2) Suspension or termination of the grant; and
    (3) Suspension or debarment of the grantee under the provisions of 
this part.
    (b) Upon issuance of any final decision under this part requiring 
debarment of a grantee, the debarred grantee shall be ineligible for 
award of any grant from any Federal agency for a period specified in the 
decision, not to exceed five years (see Sec. 208.320(a)(2) of this 
part).

[[Page 678]]



Sec. 208.625  Exception provision.

    The agency head may waive with respect to a particular grant, in 
writing, a suspension of payments under a grant, suspension or 
termination of a grant, or suspension or debarment of a grantee if the 
agency head determines that such a waiver would be in the public 
interest. This exception authority cannot be delegated to any other 
official.



Sec. 208.630  Certification requirements and procedures.

    (a)(1) As a prior condition of being awarded a grant, each grantee 
shall make the appropriate certification to the Federal agency providing 
the grant, as provided in appendix C to this part.
    (2) Grantees are not required to make a certification in order to 
continue receiving funds under a grant awarded before March 18, 1989, or 
under a no-cost time extension of such a grant. However, the grantee 
shall make a one-time drug-free workplace certification for a non-
automatic continuation of such a grant made on or after March 18, 1989.
    (b) Except as provided in this section, all grantees shall make the 
required certification for each grant. For mandatory formula grants and 
entitlements that have no application process, grantees shall submit a 
one-time certification in order to continue receiving awards.
    (c) A grantee that is a State may elect to make one certification in 
each Federal fiscal year. States that previously submitted an annual 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. Except as provided in paragraph (d) of this 
section, this certification shall cover all grants to all State agencies 
from any Federal agency. The State shall retain the original of this 
statewide certification in its Governor's office and, prior to grant 
award, shall ensure that a copy is submitted individually with respect 
to each grant, unless the Federal agency has designated a central 
location for submission.
    (d)(1) The Governor of a State may exclude certain State agencies 
from the statewide certification and authorize these agencies to submit 
their own certifications to Federal agencies. The statewide 
certification shall name any State agencies so excluded.
    (2) A State agency to which the statewide certification does not 
apply, or a State agency in a State that does not have a statewide 
certification, may elect to make one certification in each Federal 
fiscal year. State agencies that previously submitted a State agency 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. The State agency shall retain the original of 
this State agency-wide certification in its central office and, prior to 
grant award, shall ensure that a copy is submitted individually with 
respect to each grant, unless the Federal agency designates a central 
location for submission.
    (3) When the work of a grant is done by more than one State agency, 
the certification of the State agency directly receiving the grant shall 
be deemed to certify compliance for all workplaces, including those 
located in other State agencies.
    (e)(1) For a grant of less than 30 days performance duration, 
grantees shall have this policy statement and program in place as soon 
as possible, but in any case by a date prior to the date on which 
performance is expected to be completed.
    (2) For a grant of 30 days or more performance duration, grantees 
shall have this policy statement and program in place within 30 days 
after award.
    (3) Where extraordinary circumstances warrant for a specific grant, 
the grant officer may determine a different date on which the policy 
statement and program shall be in place.



Sec. 208.635  Reporting of and employee sanctions for convictions of criminal drug offenses.

    (a) When a grantee other than an individual is notified that an 
employee has been convicted for a violation of a criminal drug statute 
occurring in the workplace, it shall take the following actions:
    (1) Within 10 calendar days of receiving notice of the conviction, 
the grantee shall provide written notice, including the convicted 
employee's position

[[Page 679]]

title, to every grant officer, or other designee on whose grant activity 
the convicted employee was working, unless a Federal agency has 
designated a central point for the receipt of such notifications. 
Notification shall include the identification number(s) for each of the 
Federal agency's affected grants.
    (2) Within 30 calendar days of receiving notice of the conviction, 
the grantee shall do the following with respect to the employee who was 
convicted.
    (i) Take appropriate personnel action against the employee, up to 
and including termination, consistent with requirements of the 
Rehabilitation Act of 1973, as amended; or
    (ii) Require the employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency.
    (b) A grantee who is an individual who is convicted for a violation 
of a criminal drug statute occurring during the conduct of any grant 
activity shall report the conviction, in writing, within 10 calendar 
days, to his or her Federal agency grant officer, or other designee, 
unless the Federal agency has designated a central point for the receipt 
of such notices. Notification shall include the identification number(s) 
for each of the Federal agency's affected grants.

(Approved by the Office of Management and Budget under control number 
0991-0002)

 Appendix A to Part 208--Certification Regarding Debarment, Suspension, 
     and Other Responsibility Matters--Primary Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective primary 
participant is providing the certification set out below.
    2. The inability of a person to provide the certification required 
below will not necessarily result in denial of participation in this 
covered transaction. The prospective participant shall submit an 
explanation of why it cannot provide the certification set out below. 
The certification or explanation will be considered in connection with 
the department or agency's determination whether to enter into this 
transaction. However, failure of the prospective primary participant to 
furnish a certification or an explanation shall disqualify such person 
from participation in this transaction.
    3. The certification in this clause is a material representation of 
fact upon which reliance was placed when the department or agency 
determined to enter into this transaction. If it is later determined 
that the prospective primary participant knowingly rendered an erroneous 
certification, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.
    4. The prospective primary participant shall provide immediate 
written notice to the department or agency to which this proposal is 
submitted if at any time the prospective primary participant learns that 
its certification was erroneous when submitted or has become erroneous 
by reason of changed circumstances.
    5. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meanings set out in the Definitions and Coverage 
sections of the rules implementing Executive Order 12549. You may 
contact the department or agency to which this proposal is being 
submitted for assistance in obtaining a copy of those regulations.
    6. The prospective primary participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency entering into this transaction.
    7. The prospective primary participant further agrees by submitting 
this proposal that it will include the clause titled ``Certification 
Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-
Lower Tier Covered Transaction,'' provided by the department or agency 
entering into this covered transaction, without modification, in all 
lower tier covered transactions and in all solicitations for lower tier 
covered transactions.
    8. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from the covered transaction, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to,

[[Page 680]]

check the List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs.
    9. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    10. Except for transactions authorized under paragraph 6 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.

Certification Regarding Debarment, Suspension, and Other Responsibility 
                  Matters--Primary Covered Transactions

    (1) The prospective primary participant certifies to the best of its 
knowledge and belief, that it and its principals:
    (a) Are not presently debarred, suspended, proposed for debarment, 
declared ineligible, or voluntarily excluded by any Federal department 
or agency;
    (b) Have not within a three-year period preceding this proposal been 
convicted of or had a civil judgment rendered against them for 
commission of fraud or a criminal offense in connection with obtaining, 
attempting to obtain, or performing a public (Federal, State or local) 
transaction or contract under a public transaction; violation of Federal 
or State antitrust statutes or commission of embezzlement, theft, 
forgery, bribery, falsification or destruction of records, making false 
statements, or receiving stolen property;
    (c) Are not presently indicted for or otherwise criminally or 
civilly charged by a governmental entity (Federal, State or local) with 
commission of any of the offenses enumerated in paragraph (1)(b) of this 
certification; and
    (d) Have not within a three-year period preceding this application/
proposal had one or more public transactions (Federal, State or local) 
terminated for cause or default.
    (2) Where the prospective primary participant is unable to certify 
to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.
[60 FR 33042, 33045, June 26, 1995]

 Appendix B to Part 208--Certification Regarding Debarment, Suspension, 
 Ineligibility and Voluntary Exclusion--Lower Tier Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective lower 
tier participant is providing the certification set out below.
    2. The certification in this clause is a material representation of 
fact upon which reliance was placed when this transaction was entered 
into. If it is later determined that the prospective lower tier 
participant knowingly rendered an erroneous certification, in addition 
to other remedies available to the Federal Government the department or 
agency with which this transaction originated may pursue available 
remedies, including suspension and/or debarment.
    3. The prospective lower tier participant shall provide immediate 
written notice to the person to which this proposal is submitted if at 
any time the prospective lower tier participant learns that its 
certification was erroneous when submitted or had become erroneous by 
reason of changed circumstances.
    4. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meaning set out in the Definitions and Coverage 
sections of rules implementing Executive Order 12549. You may contact 
the person to which this proposal is submitted for assistance in 
obtaining a copy of those regulations.
    5. The prospective lower tier participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered transaction, unless authorized by the 
department or agency with which this transaction originated.
    6. The prospective lower tier participant further agrees by 
submitting this proposal that it will include this clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' without 
modification, in all lower tier covered transactions and in all 
solicitations for lower tier covered transactions.
    7. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4,

[[Page 681]]

debarred, suspended, ineligible, or voluntarily excluded from covered 
transactions, unless it knows that the certification is erroneous. A 
participant may decide the method and frequency by which it determines 
the eligibility of its principals. Each participant may, but is not 
required to, check the List of Parties Excluded from Federal Procurement 
and Nonprocurement Programs.
    8. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    9. Except for transactions authorized under paragraph 5 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency with which this transaction 
originated may pursue available remedies, including suspension and/or 
debarment.

    Certification Regarding Debarment, Suspension, Ineligibility an 
          Voluntary Exclusion--Lower Tier Covered Transactions

    (1) The prospective lower tier participant certifies, by submission 
of this proposal, that neither it nor its principals is presently 
debarred, suspended, proposed for debarment, declared ineligible, or 
voluntarily excluded from participation in this transaction by any 
Federal department or agency.
    (2) Where the prospective lower tier participant is unable to 
certify to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.
[60 FR 33042, 33045, June 26, 1995]

  Appendix C to Part 208--Certification Regarding Drug-Free Workplace 
                              Requirements

                     Instructions for Certification

    1. By signing and/or submitting this application or grant agreement, 
the grantee is providing the certification set out below.
    2. The certification set out below is a material representation of 
fact upon which reliance is placed when the agency awards the grant. If 
it is later determined that the grantee knowingly rendered a false 
certification, or otherwise violates the requirements of the Drug-Free 
Workplace Act, the agency, in addition to any other remedies available 
to the Federal Government, may take action authorized under the Drug-
Free Workplace Act.
    3. For grantees other than individuals, Alternate I applies.
    4. For grantees who are individuals, Alternate II applies.
    5. Workplaces under grants, for grantees other than individuals, 
need not be identified on the certification. If known, they may be 
identified in the grant application. If the grantee does not identify 
the workplaces at the time of application, or upon award, if there is no 
application, the grantee must keep the identity of the workplace(s) on 
file in its office and make the information available for Federal 
inspection. Failure to identify all known workplaces constitutes a 
violation of the grantee's drug-free workplace requirements.
    6. Workplace identifications must include the actual address of 
buildings (or parts of buildings) or other sites where work under the 
grant takes place. Categorical descriptions may be used (e.g., all 
vehicles of a mass transit authority or State highway department while 
in operation, State employees in each local unemployment office, 
performers in concert halls or radio studios).
    7. If the workplace identified to the agency changes during the 
performance of the grant, the grantee shall inform the agency of the 
change(s), if it previously identified the workplaces in question (see 
paragraph five).
    8. Definitions of terms in the Nonprocurement Suspension and 
Debarment common rule and Drug-Free Workplace common rule apply to this 
certification. Grantees' attention is called, in particular, to the 
following definitions from these rules:
    Controlled substance means a controlled substance in Schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812) and as 
further defined by regulation (21 CFR 1308.11 through 1308.15);
    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    Employee means the employee of a grantee directly engaged in the 
performance of work under a grant, including: (i) All direct charge 
employees; (ii) All indirect charge employees unless their impact or 
involvement is insignificant to the performance of the grant; and, (iii) 
Temporary personnel and consultants who are directly engaged in the 
performance of work under the grant and who are on the grantee's 
payroll. This definition does not include workers not on the payroll of 
the grantee (e.g., volunteers, even if used

[[Page 682]]

to meet a matching requirement; consultants or independent contractors 
not on the grantee's payroll; or employees of subrecipients or 
subcontractors in covered workplaces).

        Certification Regarding Drug-Free Workplace Requirements

             Alternate I. (Grantees Other Than Individuals)

    A. The grantee certifies that it will or will continue to provide a 
drug-free workplace by:
    (a) Publishing a statement notifying employees that the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance is prohibited in the grantee's workplace and 
specifying the actions that will be taken against employees for 
violation of such prohibition;
    (b) Establishing an ongoing drug-free awareness program to inform 
employees about--
    (1) The dangers of drug abuse in the workplace;
    (2) The grantee's policy of maintaining a drug-free workplace;
    (3) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (4) The penalties that may be imposed upon employees for drug abuse 
violations occurring in the workplace;
    (c) Making it a requirement that each employee to be engaged in the 
performance of the grant be given a copy of the statement required by 
paragraph (a);
    (d) Notifying the employee in the statement required by paragraph 
(a) that, as a condition of employment under the grant, the employee 
will--
    (1) Abide by the terms of the statement; and
    (2) Notify the employer in writing of his or her conviction for a 
violation of a criminal drug statute occurring in the workplace no later 
than five calendar days after such conviction;
    (e) Notifying the agency in writing, within ten calendar days after 
receiving notice under paragraph (d)(2) from an employee or otherwise 
receiving actual notice of such conviction. Employers of convicted 
employees must provide notice, including position title, to every grant 
officer or other designee on whose grant activity the convicted employee 
was working, unless the Federal agency has designated a central point 
for the receipt of such notices. Notice shall include the identification 
number(s) of each affected grant;
    (f) Taking one of the following actions, within 30 calendar days of 
receiving notice under paragraph (d)(2), with respect to any employee 
who is so convicted--
    (1) Taking appropriate personnel action against such an employee, up 
to and including termination, consistent with the requirements of the 
Rehabilitation Act of 1973, as amended; or
    (2) Requiring such employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency;
    (g) Making a good faith effort to continue to maintain a drug-free 
workplace through implementation of paragraphs (a), (b), (c), (d), (e) 
and (f).
    B. The grantee may insert in the space provided below the site(s) 
for the performance of work done in connection with the specific grant:

Place of Performance (Street address, city, county, state, zip code)
 _______________________________________________________________________
________________________________________________________________________
________________________________________________________________________

Check {time}  if there are workplaces on file that are not identified 
here.

              Alternate II. (Grantees Who Are Individuals)

    (a) The grantee certifies that, as a condition of the grant, he or 
she will not engage in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance in conducting 
any activity with the grant;
    (b) If convicted of a criminal drug offense resulting from a 
violation occurring during the conduct of any grant activity, he or she 
will report the conviction, in writing, within 10 calendar days of the 
conviction, to every grant officer or other designee, unless the Federal 
agency designates a central point for the receipt of such notices. When 
notice is made to such a central point, it shall include the 
identification number(s) of each affected grant.
[55 FR 21690, 21694, May 25, 1990]



  PART 209--NON-DISCRIMINATION IN FEDERALLY-ASSISTED PROGRAMS OF THE AGENCY FOR INTERNATIONAL DEVELOPMENT--EFFECTUATION OF TITLE VI OF THE CIVIL RIGHTS ACT OF 
1964--Table of Contents




Sec.
209.1  Purpose.
209.2  Application of this part.
209.3  Definitions.
209.4  Discrimination prohibited.
209.5  Assurance required.
209.6  Compliance information.
209.7  Conduct of investigations.
209.8  Procedure for effecting compliance.

[[Page 683]]

209.9  Hearings.
209.10  Decisions and notices.
209.11  Judicial review.
209.12  Effect on other regulations; supervision and coordination.
209.13  Delegation of authority.

Appendix A--Federal Financial Assistance to Which This Regulation 
          Applies

    Authority:  Sec. 602, 78 Stat. 252, and sec. 621, Foreign Assistance 
Act of 1961, 75 Stat. 445; 22 U.S.C. 2402.

    Source:  30 FR 317, Jan. 9, 1965, unless otherwise noted.



Sec. 209.1  Purpose.

    The purpose of this part is to effectuate the provisions of title VI 
of the Civil Rights Act of 1964 to the end that no person in the United 
States shall, on the ground of race, color, or national origin, be 
excluded from participation in, be denied the benefits of, or be 
otherwise subjected to discrimination under any program or activity 
receiving Federal financial assistance pursuant to any authority held or 
delegated by the Administrator of the Agency for International 
Development.



Sec. 209.2  Application of this part.

    This part applies to all programs carried on within the United 
States by recipients of Federal financial assistance pursuant to any 
authority held or delegated by the Administrator of the Agency for 
International Development, including the federally-assisted programs and 
activities listed in appendix A of this part. (appendix A may be revised 
from time to time by notice in the Federal Register.) It applies to 
money paid, property transferred, or other Federal financial assistance 
extended under any such program after the effective date of this 
regulation, even if the application for such assistance is approved 
prior to such effective date. This part does not apply to (a) any 
Federal financial assistance by way of insurance or guaranty contracts, 
(b) money paid, property transferred or other assistance extended under 
any such program before the effective date of this part, (c) any 
assistance to any individual who is the ultimate beneficiary under any 
such program, (d) any employment practice under any such program of any 
employer, employment agency, or labor organization, or (e) any 
procurement of goods or services, including the procurement of training. 
This part does not bar selection and treatment reasonably related to the 
foreign assistance objective or such other authorized purpose as the 
Federal assistance may have. It does not bar selections which are 
limited to particular groups where the purpose of the program calls for 
such a limitation nor does not bar special treatment including special 
courses of training, orientation or counseling consistent with such 
purpose.



Sec. 209.3  Definitions.

    For purposes of this part--
    (a) The term Act means the Civil Rights Act of 1964 (78 Stat. 241).
    (b) The term Administrator means the Administrator of the Agency for 
International Development or any person specifically designated by him 
to perform any function provided for under this part.
    (c) The term applicant means one who submits an application, request 
or plan required to be approved by the Administrator, or by a primary 
recipient as a condition to eligibility for Federal financial 
assistance, and the term ``application'' means such application, 
request, or plan.
    (d) The term facility includes all or any portion of structures, 
equipment, or other real or personal property or interests therein, and 
the provision of facilities includes the construction, expansion, 
renovation, remodeling, alteration or acquisition of facilities.
    (e) The term Federal financial assistance includes (1) grants and 
loans of Federal funds, (2) the grant or donation of Federal property 
and interests in property, (3) the detail of Federal personnel, (4) the 
sale and lease of, and the permission to use (on other than a casual or 
transient basis) Federal property or any interest in such property 
without consideration, or at a nominal consideration, or at a 
consideration which is reduced for the purpose of assisting the 
recipient, or in recognition of the public interest to be served by such 
sale or lease to the recipient, and (5) any Federal agreement, 
arrangement, or other contract which has as one of

[[Page 684]]

its purposes the provision of assistance.
    (f) The term primary recipient means any recipient which is 
authorized or required to extend Federal financial assistance to another 
recipient for the purpose of carrying out a program.
    (g) The term program includes any program, project or activity for 
the provision of services, financial aid, or other benefits to 
individuals (including education or training, health, welfare, 
rehabilitation, or other services, whether provided through employees of 
the recipient of Federal financial assistance or provided by others 
through contracts or other arrangements with the recipient, and 
including work opportunities and cash or loan or other assistance to 
individuals), or for the provisions of facilities for furnishing 
services, financial aid or other benefits to individuals. The services, 
financial aid, or other benefits provided under a program receiving 
Federal financial assistance shall be deemed to include any services, 
financial aid, or other benefits provided with the aid of Federal 
financial assistance or with the aid of any non-Federal funds, property, 
or other resources required to be expended or made available for the 
program to meet matching requirements or other conditions which must be 
met in order to receive the Federal financial assistance, and to include 
any services, financial aid, or other benefits provided in or through a 
facility provided with the aid of Federal financial assistance or such 
non-Federal resources.
    (h) The term recipient means any State, political subdivision of any 
State, or instrumentality of any State or political subdivision, any 
public or private agency, institution, or organization, or any other 
entity, or any individual in any State, to whom Federal financial 
assistance is extended, directly or through another recipient, for any 
program, including any successor, assign, or transferee thereof, but 
such term does not include any ultimate beneficiary under any such 
program or a sovereign foreign government.
    (i) The term United States means the States of the United States, 
the District of Columbia, Puerto Rico, the Virgin Islands, American 
Samoa, Guam, Wake Island, the Canal Zone, and the territories and 
possessions of the United States, and the term ``State'' means any one 
of the foregoing.



Sec. 209.4  Discrimination prohibited.

    (a) General. No person in the United States shall, on the grounds of 
race, color or national origin, be excluded from participation in, be 
denied the benefits of, or be subjected to discrimination under, any 
program or activity receiving Federal financial assistance from the 
Agency for International Development.
    (b) Specific discriminatory actions prohibited. (1) A recipient 
under any program to which this regulation applies may not, directly or 
through contractual or other arrangements, on the ground of race, color, 
or national origin:
    (i) Deny an individual any service, financial aid, or other benefit 
provided under the program;
    (ii) Provide any service, financial aid, or other benefit to an 
individual which is different, or is provided in a different manner, 
from that provided to others under the program;
    (iii) Subject an individual to segregation or separate treatment in 
any matter related to his receipt of any service, financial aid, or 
other benefit under the program;
    (iv) Restrict an individual in any way in the enjoyment of any 
advantage or privilege enjoyed by others receiving any service, 
financial aid, or other benefit under the program;
    (v) Treat an individual differently from others in determining 
whether he satisfies any admission, enrollment, quota, eligibility, 
membership or other requirement or condition which individuals must meet 
in order to be provided any service, financial aid, or other benefit 
provided under the program;
    (vi) Deny an individual an opportunity to participate in the program 
through the provision of services or otherwise or afford him an 
opportunity to do so which is different from that afforded others under 
the program; or
    (vii) Deny an individual an opportunity to participate in a program 
as an employee where a primary objective

[[Page 685]]

of the Federal financial assistance is to provide employment.
    (2) A recipient, in determining the types of services, financial 
aid, or other benefits, or facilities which will be provided under any 
such program, or the class of individuals to whom, or the situations in 
which, such services, financial aid, other benefits or facilities will 
be provided under any such program or the class of individuals to be 
afforded an opportunity to participate in any such program, may not, 
directly or through contractual or other arrangements, utilize criteria 
or methods of administration which have the effect of subjecting 
individuals to discrimination because of race, color, or national 
origin, or have the effect of defeating or substantially impairing 
accomplishment of the objectives of the program as respects individuals 
of a particular race, color, or national origin.
    (3) In determining the site or location of facilities, a recipient 
or applicant may not make selections with the purpose or effect of 
excluding individuals from, denying them the benefits of, or subjecting 
them to discrimination under any program to which this regulation 
applies, on the grounds of race, color or national origin; or with the 
purpose or effect of defeating or substantially impairing the 
accomplishment of the objectives of the Act or this regulation.
    (4) As used in this section the services, financial aid, or other 
benefit provided under a program receiving Federal financial assistance 
shall be deemed to include any service, financial aid, or other benefit 
provided in or through a facility provided with the aid of Federal 
financial assistance.
    (5) The enumeration of specific forms of prohibited discrimination 
in this paragraph does not limit the generality of the prohibition in 
paragraph (a) of this section.
    (6) This regulation does not prohibit the consideration of race, 
color, or national origin if the purpose and effect are to remove or 
overcome the consequences of practices or impediments which have 
restricted the availability, or participation in, the program or 
activity receiving Federal financial assistance, on the grounds of race, 
color or national origin. Where previous discriminatory practice or 
usage tends, on the grounds of race, color, or national origin, to 
exclude individuals from participation in, to deny them the benefits of, 
or to subject them to discrimination under any program or activity to 
which this Regulation applies, the applicant or recipient has an 
obligation to take reasonable action to remove or overcome the 
consequences of the prior discriminatory practice or usage, and to 
accomplish the purposes of the Act.
[30 FR 317, Jan. 9, 1965, as amended at 38 FR 17948, July 5, 1973]



Sec. 209.5  Assurance required.

    (a) General. (1) Every application for Federal financial assistance 
to carry out a program to which this part applies, except a program to 
which paragraph (b) of this section applies, and every application for 
Federal financial assistance to provide a facility shall, as a condition 
to its approval and the extension of any Federal financial assistance 
pursuant to the application, contain or be accompanied by an assurance 
that the program will be conducted or the facility operated in 
compliance with all requirements imposed by or pursuant to this part. In 
the case of an application for Federal financial assistance to provide 
real property or structures thereon, the assurance shall obligate the 
recipient, or, in the case of a subsequent transfer, the transferee, for 
the period during which the real property or structures are used for a 
purpose for which the Federal financial assistance is extended or for 
another purpose involving the provision of similar services or benefits. 
In the case of personal property the assurance shall obligate the 
recipient for the period during which he retains ownership or possession 
of the property. In all other cases the assurance shall obligate the 
recipient for the period during which Federal financial assistance is 
extended pursuant to the application. The head of the bureau or office 
administering the Federal financial assistance shall specify the form of 
the foregoing assurances for each program and the extent to which like 
assurances will be required of subgrantees, contractors and 
subcontractors, transferees, successors in interest, and other 
participants in the program. Any such

[[Page 686]]

assurance shall include provisions which give the United States a right 
to seek its judicial enforcement.
    (2) In the case of real property, structures or improvements 
thereon, or interests therein, which was acquired through a program of 
Federal financial assistance, or in the case where Federal financial 
assistance is provided in the form of a transfer of real property or 
interest therein from the Federal Government, the instrument effecting 
or recording the transfer shall contain a covenant running with the land 
assuring nondiscrimination for the period during which the real property 
is used for a purpose for which the Federal financial assistance is 
extended or for another purpose involving the provision of similar 
services or benefits. Where no transfer of property is involved, but 
property is improved under a program of Federal financial assistance, 
the recipient shall agree to include such a covenant in any subsequent 
transfer of such property. Where the property is obtained from the 
Federal Government, such covenant may also include a condition coupled 
with a right to be reserved by the Agency to revert title to the 
property in the event of a breach of the covenant where, in the 
discretion of the responsible Agency official, such a condition and 
right of reverter is appropriate to the program under which the real 
property is obtained and to the nature of the grant and the grantee. In 
such event if a transferee of real property proposed to mortgage or 
otherwise encumber the real property as security for financing 
construction of new or improvement of existing facilities on such 
property for the purposes for which the property was transferred, the 
Administrator may agree, upon request of the transferee and if necessary 
to accomplish such financing, and upon such conditions as he deems 
appropriate, to forbear the exercise of such right to revert title for 
so long as the lien of such mortgage or other encumbrance remains 
effective.
    (3) Transfers of surplus property are subject to regulations issued 
by the Administrator of General Services (41 CFR 101-6.2).
    (b) Assurances from institutions. (1) In the case of any application 
for Federal financial assistance to an institution of higher education 
(including assistance for construction, for research, for a special 
training project, for a student assistance program, or for any other 
purpose), the assurance required by this section shall extend to 
admission practices and to all other practices relating to the treatment 
of students.
    (2) The assurance required with respect to an institution of higher 
education or any other institution, insofar as the assurance relates to 
the institution's practices with respect to admission or other treatment 
of individuals as students or clients of the institution or to the 
opportunity to participate in the provision of services or other 
benefits to such individuals, shall be applicable to the entire 
institution unless the applicant establishes, to the satisfaction of the 
head of the bureau or office administering the Federal financial 
assistance, that the institution's practices in designated parts or 
programs of the institution will in no way affect its practices in the 
program of the institution for which Federal financial assistance is 
sought, or the beneficiaries of or participants in such program. If in 
any such case the assistance sought is for the construction of a 
facility or part of a facility, the assurance shall in any event extend 
to the entire facility and to facilities operated in connection 
therewith.
[30 FR 317, Jan. 9, 1965, as amended at 38 FR 17948, July 5, 1973]



Sec. 209.6  Compliance information.

    (a) Cooperation and assistance. The Administrator shall to the 
fullest extent practicable seek the cooperation of recipients in 
obtaining compliance with this part and shall provide assistance and 
guidance to recipients to help them comply voluntarily with this part.
    (b) Compliance reports. Each recipient shall keep such records and 
submit to the Administrator timely, complete and accurate compliance 
reports at such times, and in such form and containing such information, 
as the Administrator may determine to be necessary to enable him to 
ascertain whether the recipient has complied or is complying with this 
part. In the case of any program under which a primary

[[Page 687]]

recipient extends Federal financial assistance to any other recipient, 
such other recipient shall also submit such compliance reports to the 
primary recipient as may be necessary to enable the primary recipient to 
carry out its obligations under this part.
    (c) Access to sources of information. Each recipient shall permit 
access by the Administrator during normal business hours to such of its 
books, records, accounts, and other sources of information, and its 
facilities as may be pertinent to ascertain compliance with this part. 
Where any information required of a recipient is in the exclusive 
possession of any other agency, institution or person and this agency, 
institution or person shall fail or refuse to furnish this information, 
the recipient shall so certify in its report and shall set forth what 
efforts it has made to obtain the information.
    (d) Information to beneficiaries and participants. Each recipient 
shall make available to participants, beneficiaries, and other 
interested persons such information regarding the provisions of this 
part and its applicability to the program under which the recipient 
receives Federal financial assistance, and make such information 
available to them in such manner, as the Administrator finds necessary 
to apprise such persons of the protections against discrimination 
assured them by the Act and this part.



Sec. 209.7  Conduct of investigations.

    (a) Periodic compliance reviews. The Administrator shall from time 
to time review the practices of recipients to determine whether they are 
complying with this part.
    (b) Complaints. Any person who believes himself or any specific 
class of individuals to be subjected to discrimination prohibited by 
this part may by himself or by a representative file with the 
Administrator a written complaint. A complaint must be filed not later 
than 90 days from the date of the alleged discrimination, unless the 
time for filing is extended by the Administrator.
    (c) Investigations. The Administrator will make a prompt 
investigation whenever a compliance review, report, complaint, or any 
other information indicates a possible failure to comply with this part. 
The investigation should include, where appropriate, a review of the 
pertinent practices and policies of the recipient, the circumstances 
under which the possible noncompliance with this part occurred, and 
other factors relevant to a determination as to whether the recipient 
has failed to comply with this part.
    (d) Resolution of matters. (1) If an investigation pursuant to 
paragraph (c) of this section indicates a failure to comply with this 
part, the Administrator will so inform the recipient and the matter will 
be resolved by informal means whenever possible. If it has been 
determined that the matter cannot be resolved by informal means, action 
will be taken as provided for in Sec. 209.8.
    (2) If an investigation does not warrant action pursuant to 
paragraph (d)(1) of this section the Administrator will so inform the 
recipient and the complainant, if any, in writing.
    (e) Intimidatory or retaliatory acts prohibited. No recipient or 
other person shall intimidate, threaten, coerce, or discriminate against 
any individual for the purpose of interfering with any right or 
privilege secured by section 601 of the Act or this part, or because he 
has made a complaint, testified, assisted, or participated in any manner 
in an investigation, proceeding, or hearing under this part. The 
identity of complainant shall be kept confidential except to the extent 
necessary to carry out the purposes of this part, including the conduct 
of any investigation, hearing, or judicial proceeding arising 
thereunder.



Sec. 209.8  Procedure for effecting compliance.

    (a) General. If there appears to be a failure or threatened failure 
to comply with this part, and if the noncompliance or threatened 
noncompliance cannot be corrected by informal means, compliance with 
this part may be effected by the suspension or termination of or refusal 
to grant or to continue Federal financial assistance, or or by any other 
means authorized by law. Such other means may include, but are not 
limited to, (1) a reference to the Department of Justice with a

[[Page 688]]

recommendation that appropriate proceedings be brought to enforce any 
rights of the United States under any law of the United States 
(including other titles of the Act), or any assurance or other 
contractual undertaking, and (2) any applicable proceeding under State 
or local law.
    (b) Noncompliance with Sec. 209.4. If an applicant fails or refuses 
to furnish an assurance required under Sec. 209.4 or otherwise fails or 
refuses to comply with a requirement imposed by or pursuant to that 
section, Federal financial assistance may be refused in accordance with 
the procedures of paragraph (c) of this section. The Agency for 
International Development shall not be required to provide assistance in 
such a case during the pendency of the administrative proceedings under 
such paragraph, except that the Agency shall continue assistance during 
the pendency of such proceedings where such assistance is due and 
payable pursuant to an application therefor approved prior to the 
effective date of this part.
    (c) Termination of or refusal to grant or to continue Federal 
financial assistance. No order suspending, terminating, or refusing to 
grant or to continue Federal financial assistance shall become effective 
until (1) the head of the bureau or office administering the Federal 
financial assistance has advised the applicant or recipient of his 
failure to comply and has determined that compliance cannot be secured 
by voluntary means, (2) there has been an express finding on the record, 
after opportunity for hearing, of a failure by the applicant or 
recipient to comply with a requirement imposed by or pursuant to this 
part, (3) the action has been approved by the Administrator pursuant to 
paragraph (e) of Sec. 209.10 and (4) the expiration of 30 days after the 
Administrator has filed with the committee of the House and the 
committee of the Senate having legislative jurisdiction over the program 
involved, a full written report of the circumstances and the grounds for 
such action. Any action to suspend or terminate or to refuse to grant or 
to continue Federal financial assistance shall be limited to the 
particular political entity, or part thereof, or other applicant or 
recipient as to whom such finding has been made and shall be limited in 
its effect to the particular program, or part thereof, in which such 
noncompliance has been so found.
    (d) Other means authorized by law. No action to effect compliance by 
any other means authorized by law shall be taken until (1) the 
responsible Agency official has determined that compliance cannot be 
secured by voluntary means, (2) the recipient or other person has been 
notified of its failure to comply and of the action to be taken to 
effect compliance, and (3) the expiration of at least 10 days from the 
mailing of such notice to the recipient or other person. During this 
period of at least 10 days additional efforts shall be made to persuade 
the recipient or other person to comply with this part and to take such 
corrective action as may be approprie.
[38 FR 17494, July 5, 1973]



Sec. 209.9  Hearings.

    (a) Opportunity for hearing. Whenever an opportunity for a hearing 
is required by Sec. 209.8(c), reasonable notice shall be given by 
registered or certified mail, return receipt requested, to the affected 
applicant or recipient. This notice shall advise the applicant or 
recipient of the action proposed to be taken, the specific provision 
under which the proposed action against it is to be taken, and the 
matters of fact or law asserted as the basis for this action, and either 
(1) fix a date not less than 20 days after the date of such notice 
within which the applicant or recipient may request of the Administrator 
that the matter be scheduled for hearing, or (2) advise the applicant or 
recipient that the matter in question has been set down for hearing at a 
stated place and time. The time and place so fixed shall be reasonable 
and shall be subject to change for cause. The complainant, if any, shall 
be advised of the time and place of the hearing. An applicant or 
recipient may waive a hearing and submit written information and 
argument for the record. The failure of an applicant or recipient to 
request a hearing under this section or to appear at a hearing for which 
a date has been set shall be deemed to be a waiver of the right to a 
hearing under section 602 of the Act and Sec. 209.8(c) of

[[Page 689]]

this part and consent to the making of a decision on the basis of such 
information as is available.
    (b) Time and place of hearing. Hearings shall be held at the offices 
of the Agency for International Development in Washington, DC, at a time 
fixed by the Administrator unless he determines that the convenience of 
the applicant or recipient or of the Agency requires that another place 
be selected. Hearings shall be held before the Administrator or before a 
hearing examiner designated in accordance with 5 U.S.C. 3105 and 3344 
(section 11 of the Administrative Procedure Act).
    (c) Right to counsel. In all proceedings under this section, the 
applicant or recipient, and the Agency for International Development 
shall have the right to be represented by counsel.
    (d) Procedures, evidence, and record.
    (1) The hearing, decision, and any administrative review thereof 
shall be conducted in conformity with 5 U.S.C. 554-557 (sections 5-8 of 
the Administrative Procedure Act), and in accordance with such rules of 
procedure as are proper (and not inconsistent with this section) 
relating to the conduct of the hearing, giving of notices subsequent to 
those provided for in paragraph (a) of this section, taking of 
testimony, exhibits, arguments and briefs, requests for findings, and 
other related matters. Both the Agency for International Development and 
the applicant or recipient shall be entitled to introduce all relevant 
evidence on the issues as stated in the notice for hearing or as 
determined by the officer conducting the hearing at the outset of or 
during the hearing.
    (2) Technical rules of evidence shall not apply to hearings 
conducted pursuant to this part, but rules or principles designed to 
assure production of the most credible evidence available and to subject 
testimony to test by cross-examination shall be applied where reasonably 
necessary by the officer conducting the hearing. The hearing officer may 
exclude irrelevant, immaterial, or unduly repetitious evidence. All 
documents and other evidence offered or taken for the record shall be 
open to examination by the parties and opportunity shall be given to 
refute facts and arguments advanced on either side of the issues. A 
transcript shall be made of the oral evidence except to the extent the 
substance thereof is stipulated for the record. All decisions shall be 
based upon the hearing record and written findings shall be made.
    (e) Consolidated or joint hearings. In cases in which the same or 
related facts are asserted to constitute noncompliance with this part 
with respect to two or more programs to which this part applies or 
noncompliance with this part and the regulations of one or more other 
Federal departments or agencies issued under title VI of the Act, the 
Administrator may, by agreements with such other department or agencies, 
where applicable, provide for the conduct of consolidated or joint 
hearings, and for the application to such hearings of rules of procedure 
not inconsistent with this part. Final decisions in such cases, insofar 
as this part is concerned, shall be made in accordance with Sec. 209.10.
[30 FR 317, Jan. 9, 1965, as amended at 38 FR 17949, July 5, 1973]



Sec. 209.10  Decisions and notices.

    (a) Decision by a hearing examiner. If the hearing is held by a 
hearing examiner such hearing examiner shall either make an initial 
decision, if so authorized, or certify the entire record including his 
recommended findings and proposed decision to the Administrator for a 
final decision, and a copy of such initial decision or certification 
shall be mailed to the applicant or recipient and the complainant. Where 
the initial decision is made by the hearing examiner the applicant or 
recipient may within 30 days of the mailing of such notice of initial 
decision file with the Administrator his exceptions to the initial 
decision, with his reasons therefor. In the absence of exceptions, the 
Administrator may on his own motion within 45 days after the initial 
decision serve on the applicant or recipient a notice that he will 
review the decision. Upon the filing of such exceptions or of such 
notice of review the Administrator shall review the initial decision and 
issue his own decision thereon including the reasons therefor. The 
decision of the Administrator shall be mailed promptly to the applicant 
or recipient and the complainant, if any. In

[[Page 690]]

the absence of either exceptions or a notice of review the initial 
decision shall constitute the final decision of the Administrator.
    (b) Decisions on record or review by the Administrator. Wherever a 
record is certified to the Administrator for decision or he reviews the 
decision of a hearing examiner pursuant to paragraph (a) of this 
section, or whenever the Administrator conducts the hearing, the 
applicant or recipient shall be given reasonable opportunity to file 
with him briefs or other written statements of its contentions, and a 
copy of the final decision of the Administrator shall be given in 
writing to the applicant or recipient and the complainant, if any.
    (c) Decisions on record where a hearing is waived. Wherever a 
hearing is waived pursuant to Sec. 209.9(a) a decision shall be made by 
the Administrator on the record and a copy of such decision shall be 
given in writing to the applicant or recipient, and to the complainant, 
if any.
    (d) Rulings required. Each decision of a hearing officer or the 
Administrator shall set forth his ruling on each finding, conclusion, or 
exception presented, and shall identify the requirement or requirements 
imposed by or pursuant to this part with which it is found that the 
applicant or recipient has failed to comply.
    (e) Content of orders. The final decision may provide for suspension 
or termination of, or refusal to grant or continue Federal financial 
assistance, in whole or in part, under the program involved and may 
contain such terms, conditions, and other provisions as are consistent 
with and will effectuate the purposes of the Act and this part, 
including provisions designed to assure that no Federal financial 
assistance will thereafter be extended under such program to the 
applicant or recipient determined by such decision to be in default in 
its performance of an assurance given by it pursuant to this part, or to 
have otherwise failed to comply with this part, unless and until it 
corrects its noncompliance and satisfies the Administrator that it will 
fully comply with this part.
    (f) Post termination proceedings. (1) An applicant or recipient 
adversely affected by an order issued under paragraph (e) of this 
section shall be restored to full eligibility to receive Federal 
financial assistance if it satisfies the terms and conditions of that 
order for such eligibility or if it brings itself into compliance with 
this regulation and provides reasonable assurance that it will fully 
comply with this regulation.
    (2) Any applicant or recipient adversely affected by an order 
entered pursuant to paragraph (e) of this section may at any time 
request the responsible Agency official to restore fully its eligibility 
to receive Federal financial assistance. Any such request shall be 
supported by information showing that the applicant or recipient has met 
the requirements of paragraph (f)(1) of this section. If the responsible 
Agency official determines that those requirements have been satisfied, 
he shall restore such eligibility.
    (3) If the responsible Agency official denies any such request, the 
applicant or recipient may submit a request for a hearing in writing, 
specifying why it believes such official to have been in error. It shall 
thereupon be given an expeditious hearing, with a decision on the 
record, in accordance with rules of procedure issued by the responsible 
Agency official. The applicant or recipient will be restored to such 
eligibility if it proves at such a hearing that it satisfied the 
requirements of paragraph (f)(1) of this section. While proceedings 
under this paragraph are pending, the sanctions imposed by the order 
issued under paragraph (e) of this section shall remain in effect.
[30 FR 317, Jan. 9, 1965 as amended at 38 FR 17949, July 5, 1973]



Sec. 209.11  Judicial review.

    Action taken pursuant to section 602 of the Act is subject to 
judicial review as provided in section 603 of the Act.



Sec. 209.12  Effect on other regulations; supervision and coordination.

    (a) All regulations, orders or like directions heretofore issued by 
any officer of the Agency for International Development which impose 
requirements designed to prohibit any discrimination against individuals 
on the ground of race, color, or national origin under any program to 
which this part applies,

[[Page 691]]

and which authorize the suspension or termination of or refusal to grant 
or to continue Federal financial assistance to any applicant for or 
recipient of such assistance under such program for failure to comply 
with such requirements, are hereby superseded to the extent that such 
discrimination is prohibited by this part, except that nothing in this 
part shall be deemed to relieve any person of any obligation assumed or 
imposed under any such superseded regulation, order, instruction, or 
like direction prior to the effective date of this part. Nothing in this 
part, however, shall be deemed to supersede any of the following 
(including future amendment thereof): (1) Executive Order 11246, and 
regulations issued thereunder, or (2) any other regulation or 
instruction insofar as it prohibits discrimination on the grounds of 
race, color, or national origin in any program or situation to which 
this part is inapplicable, or prohibits discrimination on any other 
ground.
    (b) Supervision and coordination. The Administrator may from time to 
time assign to officials of other departments or agencies of the 
government (with the consent of such department or agency) 
responsibilities in connection with the effectuation of the purposes of 
title VI of the Act and this part (other than responsibility for final 
decision as provided in Sec. 209.10), including the achievement of 
effective coordination and maximum uniformity within the Agency for 
International Development and within the Executive branch of the 
Government in the application of title VI and this part to similar 
programs and in similar situations. Any action taken, determination 
made, or requirement imposed by an official of another Department or 
Agency acting pursuant to an assignment of responsibility under this 
subsection shall have the same effect as though such action had been 
taken by the responsible official of this Agency.
[30 FR 317, Jan. 9, 1965, as amended at 38 FR 17949, July 5, 1973]



Sec. 209.13  Delegation of authority.

    Responsibility for administration and enforcement of this part, with 
respect to programs administered by another Federal department or agency 
pursuant to delegation, transfer interagency service agreement, or other 
arrangement is vested in the head of such department or agency, or his 
delegate, and subject to such delegations or redelegations as he may 
make or authorize.

   Appendix A--Federal Financial Assistance to Which This Regulation 
                                 Applies

    1. Grants to organizations and institutions to carry on programs of 
technical cooperation and development in the United States to promote 
the economic development of less developed friendly countries. (Section 
211, Foreign Assistance Act, 22 U.S.C. 2171.)
    2. Grants to organizations and institutions to carry on programs of 
technical cooperation and development in the United States to promote 
the economic development of the less developed friendly countries of 
Latin America. (Section 251, Foreign Assistance Act, 22 U.S.C. 2211.)
    3. Grants to organizations and institutions to carry out programs in 
the United States of research into, and evaluation of, economic 
development in less developed foreign countries. (Section 241, Foreign 
Assistance Act, 22 U.S.C. 2193.)
[30 FR 317, Jan. 9, 1965, as amended at 38 FR 17949, July 5, 1973]



PART 211--TRANSFER OF FOOD COMMODITIES FOR FOOD USE IN DISASTER RELIEF, ECONOMIC DEVELOPMENT AND OTHER ASSISTANCE--Table of Contents




Sec.
211.1  General purpose and scope; legislation.
211.2  Definitions.
211.3  Cooperating sponsor agreements; program procedure.
211.4  Availability and shipment of commodities.
211.5  Obligations of cooperating sponsor.
211.6  Processing, repackaging, and labeling commodities.
211.7  Arrangements for entry and handling in foreign country.
211.8  Disposition of commodities unfit for authorized use.
211.9  Liability for loss, damage or improper distribution of 
          commodities.
211.10  Records and reporting requirements.
211.11  Suspension, termination, and expiration of program.
211.12  Waiver and amendment authority.

Appendix I to Part 211--Operational Plan

    Authority:  Section 207(c) of the Agricultural Trade Development and 
Assistance Act

[[Page 692]]

of 1954, as amended; see Public Law 101-624 104 Stat. 3632, 3641 7 
U.S.C. 1726a(c).

    Source:  57 FR 19766, May 7, 1992, unless otherwise noted.



Sec. 211.1  General purpose and scope; legislation.

    (a) Legislation. The Agricultural Trade Development and Assistance 
Act of 1954, as amended (Pub. L. 480), was further revised by the 
Agricultural Development and Trade Act of 1990, Public Law 101-624, 104 
Stat. 3632-65 (1990). The legislation implemented by the regulation in 
this part (as of the date of issuance of this part) includes sections of 
Public Law 480, as follows: Sections 1, 2, 3, 201, 202, 203, 207, 401, 
402, 403, 404, 406, 407, 408, 409, 413 and 414. Pursuant to title II of 
Public Law 480, A.I.D. may transfer agricultural commodities to address 
famine or other urgent or extraordinary relief requirements; combat 
malnutrition, especially in children and mothers; carry out activities 
that attempt to alleviate the causes of hunger, mortality and morbidity; 
promote economic and community development; promote sound environmental 
practices; and carry out feeding programs. Agricultural commodities may 
be provided to meet emergency food needs through foreign governments and 
private or public organizations, including intergovernmental 
organizations. Section 202(a) of Public Law 480 authorizes A.I.D., 
notwithstanding any other provision of law, to provide agricultural 
commodities for emergency food needs in such manner and on such terms 
and conditions as A.I.D. determines appropriate to respond to the 
emergency. Agricultural commodities also may be provided for non-
emergency assistance through private voluntary organizations or 
cooperatives which are, to the extent practicable, registered with 
A.I.D., and through intergovernmental organizations.
    (b) Terms and conditions. This part 211, also known as A.I.D. 
Regulation 11, provides the standard terms and conditions applicable to 
title II programs, except those conducted by agencies of the United 
Nations and the World Food Program. The Operational Plan submitted by a 
cooperating sponsor may propose, and justify, the waiver of any section 
of this Regulation that is not required by statute. If A.I.D. approves a 
waiver, the specific section or subsection waived will be identified in 
the Transfer Authorization signed by the cooperating sponsor and A.I.D. 
or in an attachment, prepared by A.I.D., that is appended to the 
Operational Plan.



Sec. 211.2  Definitions.

    (a) A.I.D. means the Agency for International Development or any 
successor agency, including, when applicable, each USAID. USAID means an 
office of A.I.D. located in a foreign country. AID/W means the office of 
A.I.D. located in Washington, DC.
    (b) Annual Estimate of Requirements or AER (Form A.I.D. 1550-3, 
Exhibit E, A.I.D. Handbook 9) is a statistical update of the Operational 
Plan which is signed by the cooperating sponsor requesting commodities 
under title II estimating the quantities required. When signed by AID/W, 
the AER together with the Food for Peace Program Agreement between 
A.I.D. and the cooperating sponsor, the approved Operational Plan, and 
this Regulation 11 form a donation agreement between A.I.D. and the 
cooperating sponsor with respect to the commodities included in the AER.
    (c) CCC means the Commodity Credit Corporation, a corporate agency 
and instrumentality of the United States within the U.S. Department of 
Agriculture.
    (d) (1) Cooperating sponsor means an entity, within or without the 
United States, governmental or not, such as the foreign government, the 
American Red Cross, the intergovernmental organization, or the private 
voluntary organization or cooperative, which enters into an agreement 
with the U.S. Government for the use of agricultural commodities or 
funds.
    (2) Governmental cooperating sponsor means a foreign government 
which has signed a Transfer Authorization under which agricultural 
commodities are donated for emergency purposes only. Governmental 
cooperating sponsors are treated here as a group separate from other 
cooperating sponsors since they

[[Page 693]]

are eligible only for emergency programs and their circumstances are 
different in such matters as rules governing shipping and in certain 
other aspects of agreements.
    (3) Nongovernmental cooperating sponsor means a cooperating sponsor 
which is a private voluntary organization, a cooperative, the American 
Red Cross, or other private or public agency. An intergovernmental 
organization also is treated as a nongovernmental cooperating sponsor in 
this Regulation 11 unless the text or context indicates otherwise.
    (e) Cooperative means a private sector organization whose members 
own and control the organization and share in its services and its 
profits and that provides business services and outreach in cooperative 
development for its membership.
    (f) Diplomatic Posts means the offices of the Department of State 
located in foreign countries and may include Embassies, Legations, and 
Consular offices. Since A.I.D. is responsible for title II programs, 
references in this Regulation to Diplomatic Posts apply only with 
respect to those countries where there is no USAID.
    (g) Disaster relief organizations means organizations which are 
authorized by AID/W, USAID or a Diplomatic Post to assist disaster 
victims.
    (h) Disaster victims means persons who, because of flood, drought, 
fire, earthquake, other natural or man-made disasters, or extraordinary 
relief requirements, are in need of food, feed, or other assistance.
    (i) Duty free means exempt from all customs duties, toll charges, 
taxes or governmental impositions levied on the act of importation.
    (j)(1) Food for Peace Program Agreement establishes a 
nongovernmental organization as a cooperating sponsor for which A.I.D. 
agrees to authorize future transfers of commodities in accordance with 
title II of Public Law 480 and Regulation 11 and the cooperating sponsor 
agrees to accept transfer of commodities in accordance with approved 
programs under title II and A.I.D. Regulation 11 and related procedures.
    (2) Host Country Food for Peace Program Agreement means an agreement 
between the cooperating sponsor and the foreign government of each 
cooperating country which authorizes the cooperating sponsor to conduct 
activities there in a manner consistent with the terms and conditions 
set forth within this Regulation 11.
    (3) Recipient Agency Agreement means a written agreement between the 
cooperating sponsor and a recipient agency prior to the transfer to the 
recipient agency of commodities, monetized proceeds, or other program 
income for distribution or implementation of an approved program.
    (k) Free alongside ship (f.a.s.) includes all costs of 
transportation and delivery of the goods to the dock. ``Free on board'' 
(f.o.b.) includes costs for delivering the goods and loading them aboard 
the carrier at a specific location.
    (l) Institutions means nonpenal, public or nonprofit private 
establishments that operate for charitable or welfare purposes where 
needy persons reside and receive meals including, but not limited to, 
homes for the aged, mentally and physically handicapped, refugee camps, 
and leprosy asylums.
    (m) Intergovernmental organizations means agencies sponsored and 
supported by two or more nations, one of which is the United States.
    (n) Marine salvage means the compensation made to those by whose 
assistance a vessel or its cargo has been saved from impending peril or 
recovered from actual loss.
    (o) Monetized proceeds means funds generated from the sale of title 
II commodities in approved monetization programs. Monetized proceeds 
should be deposited in a special interest-bearing account for control 
and monitoring.
    (p) Nonprofit means that the residue of income over operating 
expenses accruing in any activity, project, or program is used solely 
for the operation of such activity, project, or program.
    (q) Operational Plan is a plan submitted by the cooperating sponsor 
or potential cooperating sponsor describing the proposed use of 
commodity and/or monetized proceeds and/or program income. All 
references in this Regulation to the Operational Plan shall include the 
AER that relates to such Operational Plan.

[[Page 694]]

    (r) Private voluntary organization means a not-for-profit, 
nongovernmental organization (in the case of a United States 
organization, an organization that is exempt from Federal Income Taxes 
under section 501(c)(3) of the Internal Revenue Code of 1986) that 
receives funds from private sources, voluntary contributions of money, 
staff time, or in-kind support from the public, and that is engaged or 
is planning to engage in voluntary, charitable or development assistance 
activities (other than religious activities).
    (s) Program income means gross income earned by the cooperating 
sponsor or recipient agencies from activities supported under the 
approved program during the program period, including, but not limited 
to, interest earned on deposits of monetized proceeds, revenue from 
income generating activities, funds accruing from the sale of containers 
and nominal voluntary contributions by recipients made on the basis of 
ability to pay.
    (t) Recipient agencies means schools, institutions, welfare 
agencies, disaster relief organizations, and public or private agencies 
whose food distribution functions or project activities are sponsored by 
the cooperating sponsor and which receive for distribution to eligible 
recipients commodities or monetized proceeds or program income for 
approved project activities. A cooperating sponsor may be a recipient 
agency.
    (u) Recipients means persons who receive food assistance or the 
benefit of monetized proceeds or program income because of their 
economic or nutritional condition or who are otherwise eligible to 
receive commodities for their own use or other assistance in accordance 
with the terms and conditions of the approved Operational Plan or 
Transfer Authorization.
    (v) Registered private voluntary organization or cooperative means a 
nonprofit private voluntary organization or cooperative registered with, 
and approved by, A.I.D. The term includes foreign as well as U.S. 
registered nonprofit voluntary organizations and cooperatives. For 
discussion of registration, see 22 C.F.R. part 203, A.I.D. Regulation 3, 
Registration of Agencies for Voluntary Foreign Aid. In reviewing and 
approving proposals, A.I.D., at its discretion, may give preference to 
registered private voluntary organizations and cooperatives over those 
that are not and to U.S. private voluntary organizations and 
cooperatives over those that are foreign.
    (w) Transfer Authorization or TA means the document signed by the 
cooperating sponsor and A.I.D. which describes commodities and the 
program in which they will be used. The TA incorporates A.I.D. 
Regulation 11 and authorizes CCC to ship the commodities.
    (x) USDA means the U.S. Department of Agriculture.
    (y) Welfare agencies means public or private voluntary organizations 
that provide care, including food assistance, to needy persons who are 
not residents of institutions.



Sec. 211.3  Cooperating sponsor agreements; program procedure.

    (a) Food for Peace Program Agreement. A nongovernmental organization 
is eligible to be a cooperating sponsor for regular programs under 
paragraph (d)(2)(i) of this section only after it has entered into a 
Food For Peace Program Agreement with A.I.D. that incorporates the terms 
and conditions set forth in Regulation 11.
    (b) Host Country Food for Peace Program Agreement. Nongovernmental 
and intergovernmental cooperating sponsors shall, in addition to the 
Food for Peace Program Agreement, enter into a separate written Host 
Country Food for Peace Agreement with the foreign government of each 
country for which title II commodities are transferred to the 
cooperating sponsor. This agreement shall establish the terms and 
conditions needed by a nongovernmental cooperating sponsor to conduct a 
title II program in the country in accordance with the applicable 
requirements of this part. The cooperating sponsor shall provide USAID 
or the Diplomatic Post a copy of each executed Host Country Food for 
Peace Agreement.
    Where such written agreement is not appropriate or feasible, USAID 
or the Diplomatic Post shall assure AID/W, in writing, that the program 
can be effectively implemented in compliance with this Regulation 
without such an agreement.

[[Page 695]]

    (c) Recipient Agency Agreement. Prior to the transfer of 
commodities, monetized proceeds, or program income to a recipient agency 
for distribution or implementation of an approved program, the 
cooperating sponsor shall execute with such agency a written agreement 
which shall:
    (1) Describe the approved uses of commodities, monetized proceeds 
and program income in a manner consistent with the approved Operational 
Plan or TA;
    (2) Require the recipient agency to pay the cooperating sponsor the 
value of any commodities, monetized proceeds or program income that are 
used for purposes not permitted under the Recipient Agency Agreement or 
that are lost, damaged or misused as a result of the recipient agency's 
failure to exercise reasonable care with respect to such commodities, 
monetized proceeds or program income; and
    (3) Incorporate by reference or otherwise the terms and conditions 
set forth in this Regulation 11.

The Operational Plan may indicate those transfers of commodities, 
monetized proceeds or program income for which the cooperating sponsor 
and A.I.D. agree that a Recipient Agency Agreement would not be 
appropriate or feasible. In any case, the cooperating sponsor shall 
remain responsible for such commodities, monetized proceeds and program 
income in accordance with the terms of this Regulation 11 and the 
Operational Plan or TA. The cooperating sponsor shall provide USAID or 
the Diplomatic Post a copy of each executed Recipient Agency Agreement.
    (d) Program procedure--(1) Requests for programs. A program may be 
requested by any cooperating sponsor, including private voluntary 
organizations, cooperatives, foreign governments (for emergencies only), 
and international organizations.
    (2) Approval of programs. There are two basic patterns of decision 
typically employed in approving a request for title II assistance:
    (i) Regular programs. The cooperating sponsor submits to A.I.D. an 
Operational Plan or multi-year Operational Plan (see appendix I), 
describing the program proposed. Also, an AER will be submitted to 
A.I.D. along with the Operational Plan, estimating the quantities of 
commodities required for each program proposed. AID/W's approval of and 
signature on the AER completes this decision process.
    (ii) Individual programs. The other basic pattern of decision making 
results in a Transfer Authorization. The TA is used for all emergency 
government-to-government programs, and for nongovernmental cooperating 
sponsor programs which do not fit within the Program Agreement/AER 
framework. The TA will include by reference Regulation 11.
    (3) Subject to availability. A.I.D.'s agreement to transfer 
commodities is subject to the availability of appropriations and 
agricultural commodities during each United States Government fiscal 
year to which it applies.
    (4) Timing of decision. Under Public Law 480, section 207(a), within 
45 days of its submission to AID/W, a decision must be made on a 
proposal submitted by a private voluntary organization or cooperative, 
concurred in by USAID or the Diplomatic Post. The decision shall detail 
the reasons for approval or denial, and if denied, conditions to be met 
for approval. In addition, a USAID or Diplomatic Post must decide 
whether or not to concur in the proposal within 45 days of receiving it 
or provide a written explanation to the private voluntary organization 
or cooperative and AID/W of the reasons USAID or the Diplomatic Post 
needs more time to consider the proposal.



Sec. 211.4  Availability and shipment of commodities.

    (a) Shipment, distribution and use of commodities. Commodities shall 
be available for shipment, distribution and use in accordance with the 
provisions of the approved Operational Plan and AER, or TA and this 
Regulation 11.
    (b) Transfer of title and delivery. (1) Unless the approved 
Operational Plan or TA provides otherwise, title to the commodity shall 
pass--
    (i) For nongovernmental cooperating sponsors, at the point in the 
United States at which the ocean carrier or its agents take possession 
of the cargo (generally f.a.s. or f.o.b. vessel U.S. port); or

[[Page 696]]

    (ii) For governmental cooperating sponsors, at the destination port 
of entry, upon completion of discharge by the ocean carrier (non-
landlocked countries), or at the destination point of entry, upon 
completion of delivery by the inland carrier (landlocked countries).

Except as A.I.D. may otherwise agree in writing, the cooperating sponsor 
shall retain title to commodities, monetized proceeds, and program 
income transferred to a recipient agency for distribution or use in 
accordance with the Operational Plan or TA.
    (2) Nongovernmental cooperating sponsors shall make the necessary 
arrangements to accept commodities at the points of availability 
designated by CCC.
    (c) Processing, handling, transportation and other costs. (1) Except 
as othervise provided in the Operational Plan or TA, the United States 
will pay in accordance with this paragraph (c) processing, handling, 
transportation, and other incidental costs incurred in making 
commodities available to cooperating sponsors at U.S. ports or U.S. 
inland destinations, up to the point at which the ocean carrier takes 
possession of the cargo.
    (2) The United States will finance the transfer of commodities at 
the lowest combination inland and ocean transportation costs as 
determined by the United States and in sizes and types of packages 
announced as applicable. If a nongovernmental cooperating sponsor 
requests changes to these standards which are made by the United States 
as an accommodation to the cooperating sponsor and these changes result 
in costs over those the United States otherwise would have incurred, the 
cooperating sponsor shall reimburse the United States for these 
increased costs promptly upon request.
    (3) All costs and expenses incurred subsequent to the transfer of 
title to cooperating sponsors shall be borne by them except as otherwise 
provided herein. Upon the determination that it is in the interests of 
the program to do so, the United States may pay or reimburse the 
following additional costs:
    (i) Ocean transportation costs from U.S. ports to the designated 
ports of entry abroad; or
    (ii) Ocean transportation costs from U.S. ports to designated points 
of entry abroad in the case--
    (A) Of landlocked countries,
    (B) Where ports cannot be used effectively because of natural or 
other disturbances,
    (C) Where carriers to a specific country are unavailable, or
    (D) Where a substantial savings in cost or time can be effected by 
the utilization of points of entry other than ports; or
    (iii) In the case of commodities for urgent and extraordinary relief 
requirements, including prepositioned commodities, transportation costs 
from designated points of entry or ports of entry abroad to storage and 
distribution centers and associated storage and distribution costs.
    (d) Payment or reimbursement of ocean freight costs. When A.I.D. 
contracts for ocean carriage, carriers shall be paid by A.I.D., as 
provided in their contracts of affreightment, upon presentation of 
Standard Form 1034 and three copies of 1034A (Public Voucher for 
purchases and services other than personal), together with three copies 
of the related on-board ocean bill of lading, one copy of which must 
contain the following certification signed by an authorized 
representative of the steamship company:

    I certify that this document is a true and correct copy of the 
original on-board ocean bill of lading under which the goods herein 
described were located on the above-named vessel and that the original 
and all other copies thereof have been clearly marked as not to be 
certified for billing.

 _______________________________________________________________________
(Name of steamship co.)

        By

(Authorized representative)

Such documents shall be submitted to: Transportation Division, Office of 
Procurement, (FA/OP/TRANS), Agency for International Development, 
Washington, DC 20523. Except for duty, taxes and other costs excluded by 
Sec. 211.7 (a) and (b) of this Regulation 11, nongovernmental 
cooperating sponsors booking their own vessels will be reimbursed as 
provided in A.I.D. Regulation 2 (part 202 of this chapter) for ocean 
freight authorized by the United States upon presentation to AID/W of 
proof of

[[Page 697]]

payment to the ocean carrier. However, freight prepaid bills of lading 
which indicate firm incurrence of freight costs will be accepted by 
A.I.D. as evidence of payment to the ocean carrier provided that the 
nongovernmental cooperating sponsor agrees to ensure that such carrier 
is actually paid no later than 7 calendar days following receipt of U.S. 
Government funds by the sponsor or its agent. A.I.D. will reimburse 
nongovernmental cooperating sponsors only up to a maximum of 2\1/2\ 
percent commission paid to their freight forwarders as a result of 
booking Public Law 480, title II cargo. Similarly, when A.I.D. books 
cargo, a maximum of 2\1/2\ percent commission may be paid by the 
contracted carrier. Proof of payment of commissions must be submitted 
with requests for reimbursement.
    (e) Shipping instructions--(1) Shipments booked by A.I.D. Requests 
for shipment of commodities shall originate with the cooperating sponsor 
and shall be submitted to USAID or the Diplomatic Post for clearance and 
transmittal to AID/W. AID/W shall, through cables or letters to USAID or 
the Diplomatic Post, provide cooperating sponsors (and, where 
applicable, private voluntary organization or cooperative headquarters) 
with names of vessels, expected times of arrival (ETAs), and other 
pertinent information on shipments booked by A.I.D. As soon as possible 
but not later than 7 days from the time of exportation of commodities, 
A.I.D.'s freight forwarding contractor shall send applicable ocean bills 
of lading by airmail, or by the fastest means available, to USDA (Chief, 
Processed Commodities Division, Kansas City ASCS Commodity Office 
(KCCO), P.O. Box 419205, Kansas City, Missouri 64141-6205), to USAID or 
the Diplomatic Post (and where applicable to the USAID Controller and 
nongovernmental cooperating sponsor headquarters and field 
representative), to AID/W, FA/OP/TRANS (see Sec. 211.4(d)), and to the 
consignee in sufficient time to advise of the arrival of the shipment.
    (2) Shipments booked by nongovernmental cooperating sponsor. 
Requests for shipment of commodities shall originate with the 
cooperating sponsor and shall be cleared by USAID or the Diplomatic Post 
before transmittal to the cooperating sponsor's headquarters for 
concurrence and issuance. USAID or the Diplomatic Post shall promptly 
clear such requests for shipment of commodities or, if there is reason 
for delay or disapproval, advise the cooperating sponsor and AID/W 
within seven (7) days of receipt of requests for shipment. After the 
cooperating sponsor headquarters concurs in the request and issues the 
order, the original will be sent promptly to AID/W which will forward it 
to CCC for procurement action with a copy to USAID or the Diplomatic 
Post. Headquarters of cooperating sponsors which book their own 
shipments shall provide their representatives and USAID or the 
Diplomatic Post with the names of vessels, ETAs and other pertinent 
information on shipments booked. At the time of exportation of 
commodities, the booking agent representing the cooperating sponsor 
shall send applicable ocean bills of lading by airmail or by the fastest 
means available to USDA (Chief, Processed Commodities Division, Kansas 
City ASCS Commodity Office (KCCO), P.O. Box 419205, Kansas City, 
Missouri 64141-6205), to USAID or the Diplomatic Post (and where 
applicable to the USAID Controller and the nongovernmental cooperating 
sponsor representative), to AID/W, FA/OP/TRANS (see Sec. 211.4(d)), and 
to the consignee in the country of destination in sufficient time to 
advise of the arrival of the shipment. Nongovernmental cooperating 
sponsors also will forward cable advice of actual exportation to their 
program directors in countries within the Caribbean area in view of the 
short transit time from U.S. port to destination.
    (3) Cooperating sponsors awarding USAID-financed ocean 
transportation bookings of food aid under the Public Law 480, title II 
program shall follow consistent, transparent, fair and effective 
procedures. In order to promote these objectives, USAID may formulate, 
and from time-to-time amend, uniform standard booking guidelines 
relating to such bookings. Guidelines will be finalized only after 
consultation with affected cooperating sponsors, freight forwarders and 
carriers as

[[Page 698]]

required by the Agricultural Development and Trade Act of 1990 or other 
applicable legislation. Copies of the guidelines and any proposed 
amendments may be obtained from the Transportation Division, Office of 
Procurement, Agency for International Development, Washington, DC 20523.
    (f) Tolerances. Delivery by the United States to the cooperating 
sponsor at point of transfer of title within a tolerance of 5 percent (2 
percent in the case of quantities over 10,000 metric tons) plus or 
minus, of the quantity ordered for shipment shall be regarded as 
completion of delivery. There shall be no tolerance with respect to the 
ocean carrier's responsibility to deliver the entire cargo shipped and 
the United States assumes no obligation for failure by an ocean carrier 
to complete delivery to port of discharge.
    (g) Conflict of interest. (1) Pursuant to section 407(c)(4) of 
Public Law 480, a person may not be an agent, broker, consultant, or 
other representative of the U.S. Government, an importer, or an 
importing country in connection with agricultural commodities provided 
under Public Law 480 during a fiscal year in which such person acts as 
an agent, broker, consultant or other representative of a person engaged 
in providing ocean transportation or ocean transportation-related 
services for such commodities.
    (i) For purposes of section 407(c)(4), the term ``transportation-
related services'' means lightening, stevedoring, bagging or inland 
transportation to the destination point.
    (ii) The prohibition does not preclude payment by ocean carriers of 
compensation or brokerage fees on a shipment-by-shipment basis as 
provided in governing tariffs or charter parties to persons performing 
freight forwarding or charter broking services under contract to the 
U.S. Government.
    (2) Pursuant to section 407(d)(3) of Public Law 480, freight agents 
employed by A.I.D. under title I, II or III of Public Law 480 shall not 
represent any other foreign government during the period of their 
contract with the United States Government. This restriction applies 
both to charter brokers and freight forwarders whether they are prime 
contractors or subcontractors of A.I.D.
    (3) This paragraph (g) does not apply to shipments booked by 
nongovernmental cooperating sponsors or their agents.
[57 FR 19766, May 7, 1992, as amended at 60 FR 36991, July 19, 1995]



Sec. 211.5  Obligations of cooperating sponsor.

    (a) Operational Plans. Each cooperating sponsor shall submit a 
description of the programs it is sponsoring or proposes to sponsor to 
USAID or the Diplomatic Post for its approval. AID/W will prescribe the 
format and timing for submittals and provide final approval of the 
Operational Plan. This Operational Plan will include program purposes 
and goals; criteria for measuring program effectiveness; a description 
of the activities for which commodities, monetized proceeds, or program 
income will be provided or used; and other specific provisions in 
addition to those set forth in this Regulation. Further, this 
description will include information from which it may be determined 
that the distribution of commodities in the recipient country will not 
result in a substantial disincentive to domestic production and that 
adequate storage facilities will be available in the recipient country 
at the time of arrival of the commodity to prevent spoilage or waste of 
the commodity. For preparation of the Operational Plan, see appendix I 
to this regulation. If a cooperating sponsor submits a multi-year 
Operational Plan that is approved by A.I.D., the Operational Plan 
provided with an AER each subsequent year should cover only those 
components or features which require updating or the cooperating sponsor 
proposes to change. A.I.D. will issue guidance each year regarding 
Operational Plans that must be submitted by cooperating sponsors. Within 
the limits of the total amount of commodities, monetized proceeds and 
program income approved by A.I.D. in the Operational Plan, the 
cooperating sponsor may increase or decrease by not to exceed 10 percent 
the amount of commodities, monetized proceeds or program income 
allocated to approved program categories or components of

[[Page 699]]

the Operational Plan. Such adjustments must be identified specifically 
in the annual report submitted by a cooperating sponsor under 
Sec. 211.10(b) of the Regulation. A cooperating sponsor may not 
otherwise deviate from the Operational Plan without the prior written 
approval of A.I.D.
    (b) Program supervision. Cooperating sponsors shall provide adequate 
supervisory personnel for the efficient operation of the program, 
including personnel to:
    (1) Plan, organize, implement, control, and evaluate programs 
involving distribution of commodities or use of monetized proceeds and 
program income,
    (2) Make warehouse inspections, physical inventories, and end-use 
checks of food or funds, and
    (3) Review of books and records maintained by recipient agencies 
that receive monetized proceeds and/or program income.

Cooperating sponsors shall be represented by a person resident in the 
country of distribution or other nearby country approved by AID/W, who 
is appointed by and responsible to the cooperating sponsor for 
distribution of commodities or use of monetized proceeds or program 
income in accordance with the provisions of this regulation.
    (c) Audits--(1) By nongovernmental cooperating sponsors. A 
nongovernmental cooperating sponsor shall arrange for periodic audits to 
be conducted in accordance with OMB Circular A-133, including the OMB 
Compliance Supplement and the Statement of Position Regarding Circular 
A-133 developed by the American Institute of Certified Public 
Accountants. Nongovernmental recipient agencies shall be treated as 
subrecipients under OMB Circular A-133, and governmental recipient 
agencies shall furnish the cooperating sponsor audits in accordance with 
the standard in paragraph (c)(2) of this section. The cooperating 
sponsor may satisfy these audit responsibilities with respect to 
recipient agencies by relying on independent audits performed of 
recipient agencies or on appropriate procedures performed by the 
cooperating sponsor's internal audit or program staff, by expanding the 
scope of the independent financial and compliance audit of the 
cooperating sponsor to encompass testing of recipient agency charges, or 
by a combination of these procedures. The Generally Accepted Commodity 
Accounting Principles issued by Food Aid Management, an association of 
cooperating sponsors, may be used for commodity accounting.
    (2) By governmental cooperating sponsors. A governmental cooperating 
sponsor shall ensure that an audit satisfactory to A.I.D. is conducted 
annually with respect to donated commodities and monetized proceeds, if 
commodity sales are authorized under the agreement with A.I.D., 
including commodities and monetized proceeds transferred to or used by 
recipient agencies. The audit shall be a financial audit performed by 
the country's principal government audit agency or another audit agency 
or firm acceptable to A.I.D. This audit should be conducted in 
accordance with generally accepted government auditing standards issued 
by the United States General Accounting Office, or auditing standards 
that have been prescribed by the laws of the country or adopted by 
public accountants or an association of public accountants in the 
country, or Auditing Standards promulgated by the International 
Organization of Supreme Audit Institutions or International Auditing 
Practices Committee of the International Federation of Accountants. Both 
the auditor and the auditing standards to be used by the cooperating 
sponsor must be acceptable to A.I.D. The cooperating sponsor may satisfy 
its audit responsibility with respect to recipient agencies by relying 
on independent audits of the recipient agency or on appropriate 
procedures performed by internal audit or program staff of the 
cooperating sponsor, by expanding the scope of the independent financial 
audit of the cooperating sponsor to encompass testing of recipient 
agency charges or actions, or by a combination of these procedures. 
Recipient agencies that receive less than $25,000 of donated commodities 
and/or monetized proceeds are excluded from the cooperating sponsor's 
audit responsibility.
    (d) Commodity requirements; AER. Each cooperating sponsor shall 
submit to USAID or the Diplomatic Post,

[[Page 700]]

within such times and on the AER form prescribed by AID/W, estimates of 
requirements showing the quantities of commodities required for each 
program proposed.
    (e) No military distribution. Except as A.I.D. may otherwise agree 
in writing, agricultural commodities donated by A.I.D. shall not be 
distributed, handled or allocated by any military forces.
    (f) Determination of eligibility of recipients. Cooperating sponsors 
shall be responsible for determining that the recipients and recipient 
agencies to whom they distribute commodities are eligible in accordance 
with the Operational Plan or TA and this Regulation. Cooperating 
sponsors shall impose upon recipient agencies responsibility for 
determining that the recipients to whom they distribute commodities or 
provide assistance with monetized proceeds or program income are 
eligible. Commodities shall be distributed free of charge except as 
provided in paragraphs (j) and (k) of this section or as otherwise 
authorized by AID/W, but in no case will recipients be excluded from 
receiving commodities because of inability to make a contribution to the 
cooperating sponsor for any purpose.
    (g) No discrimination. Cooperating sponsors shall distribute 
commodities to and conduct operations (with food, monetized proceeds, or 
program income) only with eligible recipient agencies and eligible 
recipients without regard to political affiliation, geographic location, 
ethnic, tribal or religious identity or other factors extraneous to need 
and the eligibility criteria set forth in the approved Operational Plan 
or TA, and shall impose similar conditions upon recipient agencies.
    (h) Public recognition. To the maximum extent practicable, and with 
the cooperation of the host government, adequate public recognition 
shall be given in the press, by radio, and other media that the 
commodities or assistance financed by monetized proceeds or program 
income have been provided through the friendship of the American people 
as food for peace. At distribution and feeding centers or other project 
sites the cooperating sponsor shall, to the extent feasible, display 
banners, posters, or similar media which shall contain information 
similar to that prescribed for containers in paragraph (i) of this 
section. Recipients' individual identification cards shall, insofar as 
practicable, be imprinted to contain such information.
    (i) Containers--(1) Markings. Unless otherwise specified in the 
Operational Plan or TA, when commodities are packaged for shipment from 
the United States, bags and other containers shall be marked with the 
CCC contract number or other identification, the A.I.D. emblem and the 
following information stated in English:
    (i) Name of commodity;
    (ii) Provided through the friendship of the American people as food 
for peace;
    (iii) Not to be sold or exchanged (where applicable).
    (2) Disposal of containers. Cooperating sponsors may dispose of 
containers, other than containers provided by carriers, in which 
commodities are received in countries having approved title II programs, 
by sale or exchange, or may distribute the containers free of charge to 
eligible food or fiber recipients for their personal use. If the 
containers are to be used commercially, the cooperating sponsor must 
arrange for the removal, obliteration, or cross out of the U.S. 
Government markings from the containers prior to such use.
    (j) Monetization programs. Provisions of this Regulation that 
prohibit or restrict the sale of commodities or require marking or 
labeling of containers do not apply to the extent the sale of 
commodities is approved by A.I.D. Cooperating sponsors are not required 
to monitor, manage, report on or account for the distribution or use of 
commodities after title to the commodities has passed to buyers or other 
third parties pursuant to a sale under a monetization program and all 
sales proceeds have been fully deposited in the special interest-bearing 
account established by the cooperating sponsor for monetized proceeds. 
However, the receipt and use of sales proceeds must be monitored, 
managed, reported and accounted for as provided in this Regulation, with 
special reference to paragraphs (k) and (l) of this section, and 
Sec. 211.10. It is not mandatory that commodities approved

[[Page 701]]

for monetization be imported and sold free from all duties and taxes, 
but nongovernmental cooperating sponsors may negotiate agreements with 
the host government permitting the tax-free import and sale of such 
commodities. Even where the cooperating sponsor negotiates tax-exempt 
status, the prices at which the cooperating sponsor sells the 
commodities to the purchaser should reflect prices that would be 
obtained in a commercial transaction, i.e., the prices would include the 
cost of duties and taxes, except as A.I.D. may otherwise agree in 
writing. Thus, the amounts normally paid for duties and taxes would 
accrue for the benefit of the cooperating sponsor's approved program. 
Cooperating sponsors should refer to the ``Monetization Field Manual'' 
for more comprehensive guidance on setting the sales price. A copy of 
the Monetization Manual may be obtained from AID/W-FHA/PPE, Washington, 
DC 20523.
    (k) Use of funds. (1) Nongovernmental cooperating sponsors and 
recipient agencies may use monetized proceeds and program income to:
    (i) Transport, store, distribute and otherwise enhance the 
effectiveness of the use of donated commodities and products thereof, 
including construction or improvement of storage facilities or 
warehouses, handling, insect and rodent control, payment of personnel 
employed or used by the cooperating sponsor or recipient agencies in 
support of approved programs;
    (ii) Implement income generating, community development, health, 
nutrition, cooperative development, agricultural and other developmental 
activities agreed upon by A.I.D. and the cooperating sponsor;
    (iii) Make investments, with the approval of A.I.D., and any 
interest earned on such investments may be used for purposes described 
in paragraphs (k)(l) (i) and (ii) of this section;
    (iv) Improve their financial and other management systems; and
    (v) Pay indirect costs of the cooperating sponsor that are allocable 
to the monetization program at the indirect cost rate approved by A.I.D. 
for the cooperating sponsor, the direct and indirect costs of an office 
maintained by the cooperating sponsor in the country where the 
monetization program is conducted that are allocable to the title II 
program there, and the costs of a regional office maintained by a 
cooperating sponsor that are allocable to the cooperating sponsor's 
effort to enhance the effectiveness of the use of commodities provided 
by A.I.D. under title II.
    (2) Monetized proceeds and program income may be used by the 
cooperating sponsor and recipient agencies only for the purposes 
described in the Operational Plan or TA, or otherwise approved by 
A.I.D., in writing, and only for such costs as would be allowable under 
OMB Circular A-122, as amended, ``Cost Principles for Nonprofit 
Organizations''. A recipient agency may use not to exceed $500 per year 
of voluntary contributions for institutional, community or social 
development or other humanitarian purposes without regard to the 
Operational Plan or TA or OMB Circular A-122.
    (3) Governmental cooperating sponsors shall use monetized proceeds 
and program income only for emergency purposes as described in the TA 
with respect to such programs.
    (4) Monetized proceeds and program income may not be used to pay for 
the performance of abortions as a method of family planning or to 
motivate or coerce any person to practice abortions.
    (5) Except as A.I.D. may otherwise agree in writing, monetized 
proceeds may not be used to finance the production for export of 
agricultural commodities, or products thereof, that would compete in the 
world market with similar agricultural commodities, or products thereof, 
produced in the United States, if such competition would cause 
substantial injury to the United States producers, as determined by 
A.I.D.
    (6) (i) The cooperating sponsor shall use commercially reasonable 
practices in construction activities and in purchasing goods and 
services with monetized proceeds or program income; maintain a code of 
standards of conduct regarding conflicts of interest; carry out 
procurement transactions in

[[Page 702]]

a manner to provide open and free competition to the maximum extent 
practicable; and maintain and make available to A.I.D. in accordance 
with Sec. 211.10 records and documents regarding the procurement of 
goods and services with monetized proceeds and program income. 
Cooperating sponsors shall follow their own requirements relating to bid 
guarantees, performance bonds and payment bonds when program income or 
monetized proceeds are used to finance construction or the improvement 
of facilities, but shall consult with USAID or the Diplomatic Post 
regarding such requirements when the estimated cost of such construction 
or improvements exceeds $100,000. Title to real and personal property 
shall be vested in the cooperating sponsor, except as provided in the 
Operational Plan or TA or as A.I.D. may otherwise agree in writing, 
subject to the requirements of Sec. 211.11 upon termination of the 
program.
    (ii) Monetized proceeds and program income may not be used to 
acquire, construct, alter or upgrade land, buildings or other real 
property improvements that are used in whole or in part for sectarian 
purposes or which are owned or managed by a church or other organization 
engaged exclusively in religious activity. Notwithstanding the preceding 
sentence, monetized proceeds or program income may be used to finance 
repair or rehabilitation of an existing structure owned or managed by a 
church or organization engaged exclusively in religious activity to the 
extent necessary to avoid spoilage or loss of donated commodities, 
provided that the structure is not used in whole or in part for any 
sectarian purpose while donated commodities are stored in it. The use of 
monetized proceeds or program income to finance construction of such a 
structure may be approved in the Operational Plan or TA or by USAID or 
the Diplomatic Post if the structure is needed and will be used for the 
storage of donated commodities for a sufficient period of time to 
warrant the expenditure of monetized proceeds or program income and the 
structure will not be used for any sectarian purpose during this period.
    (l) Report on funds. The cooperating sponsor (headquarters, if there 
is more than one office) shall annually provide AID/W a report on the 
receipt and disbursement of all monetized proceeds and program income by 
cooperating sponsors and recipient agencies. This report should include 
the source of the funds, by country, and how the funds were used. This 
annual report should be submitted to AID/W by December 31 of each 
calendar year for the fiscal year ending September 30 of that calendar 
year.
    (m) No displacement of sales. Except in the case of emergency or 
disaster situations, the donation of commodities furnished for these 
programs shall not result in increased availability for export by the 
recipient country of the same or like commodities and shall not 
interfere with or displace sales in the recipient country which might 
otherwise take place. A country may be exempt from this proviso if 
circumstances warrant. USAIDs should seek AID/W guidance on this matter.
    (n) Commodities borrowed or exchanged for programs. After the date 
of the program approval by AID/W, but before arrival at the distribution 
point of the commodities authorized, the cooperating sponsor may, with 
prior approval of USAID or the Diplomatic Post, borrow the same or 
similar commodities from available sources to meet program requirements 
provided that:
    (1) Borrowed commodities which are used in accordance with the terms 
of the Operational Plan or TA will be replaced with commodities 
transferred by A.I.D. The amount of commodities transferred to replace 
borrowed commodities shall be established by mutual agreement between 
the cooperating sponsor and USAID or the Diplomatic Post and will be 
determined on the basis of equivalent value at the time and place of 
transfer or on some other justifiable basis proposed by the cooperating 
sponsor and acceptable to USAID or the Diplomatic Post;
    (2) Packaged commodities which are borrowed shall be appropriately 
identified insofar as practicable in the language of the country of 
distribution as having been provided through the friendship of the 
American people as food for peace; and

[[Page 703]]

    (3) Suitable publicity shall be given to the exchange of commodities 
as provided in paragraph (h) of this section and containers for borrowed 
commodities shall be marked to the extent practicable in accordance with 
Sec. 211.6(c).
    (o) Commodity transfer between programs. After the date of program 
approval by AID/W, but before distribution of the commodities, USAID or 
the Diplomatic Post (or the cooperating sponsor with prior approval of 
USAID or the Diplomatic Post) may transfer commodities between approved 
title II programs to meet emergency disaster requirements or to improve 
efficiency of operation, such as to meet temporary shortages due to 
delays in ocean transportation or provide for rapid distribution of 
stocks in danger of deterioration. Transfers also may be made to 
disaster organizations for use in meeting exceptional circumstances. 
Commodity transfers shall be made at no cost to the U.S. Government and 
with the concurrence of the cooperating sponsor and disaster relief 
organization concerned. A USAID or Diplomatic Post with funds available, 
however, may pay the costs of transfers to meet extraordinary relief 
requirements, and AID/W shall be advised promptly of the details of the 
transfer. Commodities transferred between programs shall not be replaced 
by the U.S. Government unless AID/W authorizes such replacement.
    (p) Disposal of excessive stock of commodities. If commodities are 
on hand which cannot be utilized in accordance with the approved 
Operational Plan or the TA, the cooperating sponsor shall promptly 
advise USAID or the Diplomatic Post of the quantities, location and 
condition of such commodities, and where possible, shall propose an 
alternate use of the excess stocks; USAID or the Diplomatic Post shall 
determine the most appropriate use of the excess stocks, and with prior 
AID/W concurrence, shall issue instructions for disposition. 
Transportation costs and other charges attributable to transferring 
commodities from one program to another within the country shall be the 
responsibility of the cooperating sponsor, except that in case of 
disaster or emergency, AID/W may authorize the use of disaster or 
emergency funds to pay for the costs of such transfers. (For discussion 
of unfit commodity disposal, see Sec. 211.8.)
    (q) Trilateral exchange programs. The restrictions in this 
Regulation regarding the distribution, use or labeling of commodities 
shall not apply to commodities furnished by CCC in exchange for other 
commodities obtained from third parties (``exchanged commodities'') to 
be distributed in a recipient country under a trilateral exchange 
program. Except as A.I.D. and the cooperating sponsor may otherwise 
agree in writing, title to the exchanged commodities will pass to the 
cooperating sponsor upon delivery to and acceptance by the cooperating 
sponsor at the point of delivery specified in the Operational Plan or 
TA. After title passes to the cooperating sponsor the exchanged 
commodities shall be deemed ``commodities'' covered by this Regulation 
with respect to all post-delivery obligations of the cooperating sponsor 
contained in this Regulation, including obligations regarding labeling 
to the extent practicable, distribution, monitoring, reporting, 
accounting and use of commodities or monetized proceeds resulting from 
their sale. In the event of difficulty in satisfying the labeling 
requirement, the cooperating sponsor will consult with USAID or the 
Diplomatic Post for guidance.
    (r) Landing. Governmental cooperating sponsors shall permit donated 
commodities to be discharged notwithstanding any dispute or question 
concerning quality, quantity, or other matters relating to the commodity 
itself. Any such dispute or question shall be resolved in accordance 
with procedures stated in this Regulation or in the relevant shipping or 
other contracts, as applicable.



Sec. 211.6  Processing, repackaging, and labeling commodities.

    (a) Commercial processing and repackaging. Cooperating sponsors or 
their designees may arrange for processing commodities into different 
end products and for packaging or repackaging commodities prior to 
distribution. Commodities may be bartered, or monetized proceeds or 
program income

[[Page 704]]

may be used, to offset such costs if provided for in the Operational 
Plan or TA or approved by USAID or the Diplomatic Post. When commercial 
facilities are used for processing, packaging or repackaging, 
cooperating sponsors or their designees shall enter into written 
agreements for such services and copies of the agreements must be 
provided to USAID or the Diplomatic Post. Except as AID/W otherwise 
agrees, the executed agreements shall provide as a minimum that the 
party providing such services shall:
    (1) Fully account to the cooperating sponsor for all commodities 
delivered to the processor's possession and shall maintain adequate 
records and submit periodic reports pertaining to the performance of the 
agreement;
    (2) Be liable for the value of all commodities not accounted for as 
provided in Sec. 211.9(e);
    (3) Return or dispose of the containers in which the commodity is 
received from the cooperating sponsor according to instructions from the 
cooperating sponsor; and
    (4) Plainly label carton, sacks, or other containers containing the 
end product in accordance with paragraph (c) of this section.
    (b) Use of cooperating sponsor facilities. When cooperating sponsors 
utilize their own facilities to process, package, or repackage 
commodities into different end products, and when such products are 
distributed for consumption off the premises of the cooperating sponsor, 
the cooperating sponsor shall plainly label the containers as provided 
in paragraph (c) of this section, and banners, posters, or similar media 
which shall contain information similar to that prescribed in paragraph 
(c) of this section, shall be displayed at the distribution center. 
Recipients' individual identification cards shall to the maximum extent 
practicable be imprinted to contain such information.
    (c) Labeling. If, prior to distribution, the cooperating sponsor 
arranges for packaging or repackaging donated commodities, the cartons, 
sacks, or other containers in which the commodities are packed shall be 
plainly labeled with the A.I.D. emblem, and insofar as practicable, with 
the following information in the language of the country in which the 
commodities are to be distributed:
    (1) Name of commodity;
    (2) Provided through the friendship of the American people as food 
for peace; and
    (3) Not to be sold or exchanged (where applicable).

Emblems or other identification of nongovernmental cooperating sponsors 
also may be added.
    (d) Where commodity containers are not used. When the usual practice 
in a country is not to enclose the end product in a container, wrapper, 
sack, etc., the cooperating sponsor shall, to the extent practicable, 
display banners, posters, or other media, and imprint on individual 
recipient identification cards information similar to that prescribed in 
paragraph (c) of this section.



Sec. 211.7  Arrangements for entry and handling in foreign country.

    (a) Costs at discharge ports. Except as otherwise agreed upon by 
AID/W and provided in the applicable shipping contract or in paragraph 
(d) and (e) of this section, the cooperating sponsor shall be 
responsible for all costs, other than those assessed by the delivering 
carrier either in accordance with its applicable tariff for delivery to 
the discharge port or the applicable charter or booking contract. The 
cooperating sponsor shall be responsible for all costs related to
    (1) Distributing the commodity to end users, as provided in the 
approved Operational Plan or TA;
    (2) Demurrage, detention, and overtime;
    (3) Obtaining independent discharge survey reports as provided in 
Sec. 211.9 under which the cooperating sponsor will be reimbursed for 
the costs of obtaining independent survey reports as provided in 
Sec. 211.9(c)(1)(iv); and
    (4) Wharfage, taxes, dues, and port charges assessed and collected 
by local authorities from the consignee, lighterage (when not a custom 
of the port), and lightening costs when assessed as a charge separate 
from the freight rate.
    (b) Duty, taxes, and consular invoices. Except for commodities which 
are to be monetized (sold) under an approved Operational Plan or TA, 
commodities shall be admitted duty free and exempt

[[Page 705]]

from all taxes. Consular or legalization invoices shall not be required 
unless specific provision is made in the Operational Plan or TA. If 
required, they shall be issued without cost to the cooperating sponsor 
or to the Government of the United States. The cooperating sponsor shall 
be responsible for ensuring prompt entry and transit in the foreign 
country(ies) and for obtaining all necessary import permits, licenses or 
other appropriate approvals for entry and transit, including 
phytosanitary, health and inspection certificates.
    (c) Storage facilities and transportation in foreign countries. The 
cooperating sponsors shall provide assurance to USAID or the Diplomatic 
Post that all necessary arrangements for receiving the commodities have 
been made, and shall assume full responsibility for storage and 
maintenance of the commodities from time of delivery at port of entry 
abroad or, when authorized, at other designated points of entry abroad 
agreed upon between the cooperating sponsor and A.I.D. Before 
recommending approval of a program to AID/W, USAID or the Diplomatic 
Post shall obtain, from the cooperating sponsor, assurance that 
provision has been made for internal transportation, and for storage and 
handling which are adequate by local commercial standards. The 
cooperating sponsor shall be responsible for the maintenance of the 
commodities in such manner as to assure distribution of the commodities 
in good condition to recipient agencies or eligible recipients.
    (d) Inland transportation in intermediate countries. In the case of 
landlocked countries, transportation in the intermediate country to a 
designated inland point of entry in the recipient country shall be 
arranged by the cooperating sponsor unless otherwise provided in the 
Operational Plan or TA. Nongovernmental cooperating sponsors shall 
handle claims arising from loss or damage in the intermediate country, 
in accordance with Sec. 211.9(e). Governmental cooperating sponsors 
shall assign any rights that they may have to any claims that arise in 
the intermediate country to USAID or the Diplomatic Post which shall 
pursue and retain the proceeds of such claims.
    (e) Authorization for reimbursement of costs. If, because of 
packaging damage, a cooperating sponsor determines that commodities must 
be repackaged to ensure that the commodities arrive at the distribution 
point in a wholesome condition, the cooperating sponsor may incur 
expenses for such repackaging up to $500 and such costs will be 
reimbursed by CCC. If costs will exceed $500, the authority to repackage 
and incur the costs must be approved by USAID or the Diplomatic Post in 
advance of repackaging unless such prior approval is specifically 
waived, in writing, by USAID or the Diplomatic Post. For losses in 
transit, the $500 limitation shall apply to all commodities which are 
shipped on the same voyage of the same vessel to the same port of 
destination, irrespective of the kinds of commodities shipped or the 
number of different bills of lading issued by the carrier. For other 
losses, the $500 limitation shall apply to each loss situation, e.g., if 
700 bags are damaged in a warehouse due to an earthquake, the $500 
limitation applies to the total cost of repackaging the 700 bags. 
Shipments may not be artificially divided in order to avoid the 
limitation of $500 or for obtaining prior approval to incur repackaging 
costs.
    (f) Method of reimbursement. (1) Costs of repackaging required 
because of damage occurring prior to or during discharge from the ocean 
carrier should be included, as a separate item, in claims filed against 
the ocean carrier. (See Sec. 211.9(c).) Full reimbursement of such costs 
up to $500 will be made by CCC upon receipt of invoices or other 
documents to support such costs. For amounts expended in excess of $500, 
reimbursement will be made upon receipt of supporting invoices or other 
documents establishing the costs of repackaging and showing the prior 
approval of USAID or the Diplomatic Post to incur the costs, unless 
approval is waived under Sec. 211.7(e).
    (2) Costs of repackaging required because of damage caused after 
discharge of the cargo from the ocean carrier will be reimbursed to the 
cooperating sponsor by CCC (USDA-ASCS Fiscal Division, 14th & 
Independence Avenue, Washington, DC 20250) upon receipt of

[[Page 706]]

supporting invoices or other documentation.



Sec. 211.8  Disposition of commodities unfit for authorized use.

    (a) Prior to delivery to cooperating sponsor at discharge port or 
point of entry. If the commodity is damaged prior to delivery to a 
governmental cooperating sponsor at discharge port or point of entry 
overseas, USAID or the Diplomatic Post shall immediately arrange for 
inspection by a public health official or other competent authority. A 
nongovernmental cooperating sponsor shall arrange for such an inspection 
under these circumstances. Commodity that is determined to be unfit for 
authorized use shall be disposed of in accordance with the priority set 
forth in paragraph (b). Expenses incidental to the handling and 
disposition of the damaged commodity shall be paid by USAID or the 
Diplomatic Post from the sales proceeds, from CCC Account No. 20FT401 or 
from the special title II, Public Law 480 Agricultural Commodity 
Account. The net proceeds of sales shall be deposited with the U.S. 
Disbursing Officer American Embassy, for the credit of CCC Account No. 
20FT401.
    (b) After delivery to cooperating sponsor. (1) If after arrival in a 
foreign country it appears that all or part of the commodities, may be 
unfit for the use authorized in the Operational Plan or TA, the 
cooperating sponsor shall immediately arrange for inspection of the 
commodity by a public health official or other competent authority 
approved by USAID or the Diplomatic Post. If no competent local 
authority is available, USAID or the Diplomatic Post may determine 
whether the commodities are unfit, and if so, may direct disposal in 
accordance with paragraphs (b) (1) through (4) of this section. The 
cooperating sponsor shall arrange for the recovery for authorized use of 
that part designated during the inspection as suitable for program use. 
If, after inspection, the commodity (or any part thereof) is determined 
to be unfit for authorized use the cooperating sponsor shall notify 
USAID or the Diplomatic Post of the circumstances pertaining to the loss 
or damage as prescribed in Sec. 211.9(f).
    (2) A cooperating sponsor shall dispose of commodities determined to 
be unfit for authorized use in the order of priority described in 
paragraphs (b)(2) (i) through (iv) of this section. The concurrence of 
USAID or the Diplomatic Post should be requested for disposition of 
commodities valued at $500 or more. If the USAID or Diplomatic Post does 
not respond to the cooperating sponsor's request for concurrence within 
15 days, the cooperating sponsor may dispose of the commodities in the 
manner described in its request and inform the USAID or Diplomatic Post 
of its action taken in accordance with this section.
    (i) Sale for the most appropriate use, i.e., animal feed, 
fertilizer, or industrial use, at the highest obtainable price. When the 
commodity is sold, all U.S. Government markings shall be obliterated, 
removed or crossed out.
    (ii) Transfer to an approved Food for Peace program for use as 
livestock feed. AID/W shall be advised promptly of any such transfer so 
that shipments from the United States to the livestock feeding program 
can be reduced by an equivalent amount.
    (iii) Donation to a governmental or charitable organization for use 
as animal feed or for other nonfood use.
    (iv) If the commodity is unfit for any use or if disposal in 
accordance with paragraphs (b)(2) (i), (ii) or (iii) of this section is 
not possible, the commodity shall be destroyed in such manner as to 
prevent its use for any purpose. Commodities valued at $500 or more 
shall be destroyed under the observation of a representative of the 
USAID or Diplomatic Post if practicable. When the cooperating sponsor 
informs the USAID or Diplomatic Post of its intention to destroy 
commodities, the cooperating sponsor shall indicate the kind and amount 
of commodities that will be destroyed, the manner of destruction, the 
representative(s) of local authorities who will witness the destruction, 
and the date when the commodities will be destroyed. The date shall be 
established on the basis of programmatic need, but an effort should be 
made to provide a reasonable opportunity for a representative of the 
USAID or Diplomatic Post to attend. The commodities may be destroyed on 
the date indicated

[[Page 707]]

even if there is no representative of the USAID or Diplomatic Post to 
observe this action.
    (3) Expenses incidental to the handling and disposition of the 
damaged commodity shall be paid by the cooperating sponsor unless it is 
determined by USAID or the Diplomatic Post that the damage could not 
have been prevented by the proper exercise of the cooperating sponsor's 
responsibility under the terms of the Operational Plan or TA. Actual 
expenses incurred, including third party costs, in selling the 
commodities may be deducted from the sales proceeds and, except for 
monetization programs, the net proceeds shall be deposited with the U.S. 
Disbursing Officer, American Embassy, with instructions to credit the 
deposit to CCC Account No. 20FT401. In monetization programs, net 
proceeds shall be deposited in the special account used for the approved 
program.
    (4) The cooperating sponsor shall furnish USAID or the Diplomatic 
Post a written report in accordance with Sec. 211.9(f), and the report 
shall enclose a certification by a public health official or other 
competent authority of
    (i) The exact quantity of the damaged commodity disposed of because 
it was determined to be unfit for any use and
    (ii) The manner in which the commodities were destroyed.



Sec. 211.9  Liability for loss damage or improper distribution of commodities.

    (Where the instructions in this Sec. 211.9 state that the 
cooperating sponsor should contact USDA or CCC, the contact office is: 
Kansas City ASCS Commodity Office (KCCO), P.O. Box 419205, Kansas City, 
Missouri 64141-6205. For Section 211.9 (a) and (b) contact: KCCO, Chief, 
Processed Commodities Division. For Sec. 211.9(c) contact: KCCO, Chief, 
Claims and Collections Division, Kansas City, Missouri 64141-6105.)
    (a) Fault of cooperating sponsor prior to loading on ocean vessel. A 
cooperating sponsor and A.I.D. shall agree on a schedule for shipping 
commodities. A nongovernmental cooperating sponsor that books cargo for 
ocean transportation must notify USDA immediately if the vessel does not 
arrive at the U.S. port of export in accordance with the agreed shipping 
schedule. USDA will determine whether the commodity shall be
    (1) Moved to another available outlet;
    (2) Stored at the port for delivery to the nongovernmental 
cooperating sponsor when a vessel is available for loading; or
    (3) Disposed of as USDA may deem proper.

When CCC incurs additional expenses because the nongovernmental 
cooperating sponsor, or its agent, fails to meet the agreed shipping 
schedule or to make necessary arrangements to accept commodities at the 
points of delivery designated by CCC, and CCC determines that the 
expenses were incurred because of the fault or negligence of the 
nongovernmental cooperating sponsor, the cooperating sponsor shall 
reimburse CCC for such expenses or take such action as directed by CCC.
    (b) Fault of others prior to loading on ocean vessel. A 
nongovernmental cooperating sponsor shall immediately notify CCC if 
there is a loss of or damage to commodities, between the time title is 
transferred to the cooperating sponsor and the time the commodities are 
loaded on board the vessel, that is caused by the act or omission of a 
third party, such as a warehouseman or carrier, who is or may be legally 
liable for the loss or damage. The cooperating sponsor also shall 
promptly assign to CCC any claim it has against the third party and 
forward to CCC all documents relating to the loss or damage and the 
claim. CCC shall have the right to initiate, prosecute, and retain the 
proceeds all claims for such loss or damage.
    (c) Ocean carrier loss and damage--(1) Survey and outturn reports. 
(i) Nongovernmental cooperating sponsors shall arrange for an 
independent cargo surveyor to attend the discharge of the cargo and to 
count or weigh the cargo and examine its condition, unless USAID or the 
Diplomatic Post determines that such examination is not feasible, or if 
CCC has made other provision for such examinations and reports. The 
surveyor shall prepare a report of its findings showing the quantity and 
condition of the commodities discharged. The report also shall show the 
probable cause of any damage

[[Page 708]]

noted, and set forth the time and place when the examination was made. 
If practicable, the examination of the cargo shall be conducted jointly 
by the surveyor, the consignee, and the ocean carrier, and the survey 
report shall be signed by all parties. Customs receipts, port authority 
reports, shortlanding certificates, cargo boat notes, stevedore's 
tallies, etc., where applicable, shall be obtained and furnished with 
the report of the surveyor. Whenever a damaged commodity appears unfit 
for its intended use, the cooperating sponsor shall obtain
    (A) A certification by a public health official or similar competent 
authority regarding the condition of the commodity; and
    (B) A certificate of disposition if the commodity is determined to 
be unfit for its intended use. These certificates shall be obtained as 
soon as possible after discharge of the cargo. If the cooperating 
sponsor can provide a narrative chronology or other commentary to assist 
in the adjudication of ocean transportation claims, this information 
should be forwarded as follows: cooperating sponsors shall prepare such 
a statement in any case where the loss is estimated to be in excess of 
$5,000; all documentation shall be in English or supported by an English 
translation and shall be forwarded as set forth in paragraphs (c)(1) 
(iii) and (iv) of this section; and the cost of an English translation 
shall be incorporated into the survey fee. The cooperating sponsor may, 
at its option, also engage the independent surveyor to supervise 
clearance and delivery of the cargo from customs or port areas to the 
cooperating sponsor or its agent and to issue delivery survey reports 
thereon.
    (ii) In the event of cargo loss or damage, a nongovernmental 
cooperating sponsor shall provide the names and addresses of individuals 
who were present at the time of discharge and during survey and who can 
verify the quantity lost or damaged. In the case of bulk grain 
shipments, the cooperating sponsor shall obtain the services of an 
independent surveyor to:
    (A) Observe discharge of the cargo;
    (B) Report on discharging method (including whether a scale was 
used, its type and calibration and other factors affecting its accuracy, 
or an explanation of why a scale was not used and how weight was 
determined);
    (C) Furnish information as to whether cargo was discharged in 
accordance with port customs;
    (D) Provide actual or estimated (if scales not used) quantity of 
cargo lost during discharge and specify how such losses occurred;
    (E) Obtain copies of port and/or ship records including scale 
weights, where applicable, to show quantity discharged;
    (F) Verify that upon conclusion of discharge, cargo holds are empty;
    (G) Provide to USDA information as to quantity, type and cause of 
lost or damaged cargo;
    (H) Furnish daily tally totals and any other pertinent information 
about the bagging of the bulk cargo when cargo is bagged or stacked by 
vessel interests; and
    (I) Notify the cooperating sponsor immediately if additional 
services are necessary to protect cargo interests or if the surveyor has 
reason to believe that the correct quantity was not discharged.

The cooperating sponsor, in the case of damage to bulk grain shipments, 
shall obtain and provide the same documentation regarding quality of 
cargo as set forth in Sec. 211.8(a) and paragraph (c)(1)(i) of this 
section. In the case of shipments arriving in container vans, 
cooperating sponsors shall require the independent surveyor to list the 
container van numbers and seal numbers shown on the container vans, and 
indicate whether the seals were intact at the time the container vans 
were opened, and whether the container vans were in any way damaged. To 
the extent possible, the independent surveyor should observe discharge 
of container vans from the vessel to ascertain whether any damage to the 
container van occurred and arrange for surveying the contents of any 
damaged container vans as they are opened.
    (iii) Cooperating sponsors shall send to USDA copies of all reports 
and documents pertaining to the discharge of commodities. For those 
surveys arranged by CCC, the cooperating sponsors may obtain a copy of 
the report

[[Page 709]]

from the local USAID Food for Peace Officer.
    (iv) CCC will reimburse a nongovernmental cooperating sponsor for 
the costs incurred by it in obtaining the services of an independent 
surveyor to conduct examinations of the cargo and render the report set 
forth above. Reimbursement by CCC will be made upon receipt by CCC of 
the survey report and the surveyor's invoice or other documents that 
establish the survey cost. However, CCC will not reimburse a 
nongovernmental cooperating sponsor for the costs of only a delivery 
survey, in the absence of a discharge survey, or for any other survey 
not taken contemporaneously with the discharge of the vessel, unless 
such deviation from the documentation requirements of paragraph (c)(1) 
of this section is justified to the satisfaction of CCC.
    (v) CCC normally will contract for the survey of cargo on shipments 
furnished under Transfer Authorizations, including shipments for which 
A.I.D. contracts for the ocean transportation services. Survey contracts 
normally will be let on a competitive bid basis. However, if a USAID or 
Diplomatic Post desires that CCC limit its consideration to only certain 
selected surveyors, USAID or the Diplomatic Post shall furnish AID/W a 
list of eligible surveyors for forwarding to CCC. Surveyors may be 
omitted from the list, for instance, based on foreign relations 
considerations, conflicts of interest, and/or lack of demonstrated 
capability to carry out surveying responsibilities properly as set forth 
in the requirements of CCC. Upon receipt of written justification for 
removal of a particular survey firm, CCC will consider removal of such 
firm and advise the USAID via AID/W of the final determination. AID/W 
will furnish CCC's surveying requirements to a USAID or Diplomatic Post 
upon request. If CCC is unable to find a surveyor at a port to which a 
shipment has been consigned, CCC may request AID/W to contact USAID or 
the Diplomatic Post to arrange for a survey. The surveyor's bill for 
such services shall be submitted to USAID or the Diplomatic Post for 
review. After the billing has been approved, USAID or the Diplomatic 
Post either may pay the bill using funds in CCC account 20FT401, if 
available, or forward the bill to AID/W for transmittal to CCC for 
payment. If USAID or the Diplomatic Post pays the bill, AID/W shall be 
advised of the amount paid, and CCC will reimburse USAID or the 
Diplomatic Post.
    (2) Claims against ocean carriers. (i) Whether or not title to 
commodities has transferred from CCC to the cooperating sponsor, if 
A.I.D. contracted for the ocean transportation, CCC shall have the right 
to initiate, prosecute, and retain the proceeds of all claims against 
ocean carriers for cargo loss and/or damage arising out of shipments of 
commodities transferred or delivered by CCC hereunder.
    (ii)(A) Unless otherwise provided in the Operational Plan or TA, 
nongovernmental cooperating sponsors shall file notice of any cargo loss 
and/or damage with the ocean carrier immediately upon discovery of any 
such loss and/or damage, promptly initiate claims against the ocean 
carrier for cargo loss and/or damage, take all necessary action to 
obtain restitution for losses within any applicable periods of 
limitations, and transmit to CCC copies of all such claims. However, the 
nongovernmental cooperating sponsor need not file a claim when the cargo 
loss and/or damage is not in excess of $100, or in any case when the 
loss and/or damage is between $100 and $300 and it is determined by the 
nongovernmental cooperating sponsor that the cost of filing and 
collecting the claim will exceed the amount of the claim. The 
nongovernmental cooperating sponsor shall transmit to CCC copies of all 
claims filed with the ocean carriers for cargo loss and/or damage, as 
well as information and/or documentation on shipments when no claim is 
to be filed. When General Average has been declared, no action will be 
taken by the nongovernmental cooperating sponsor to file or collect 
claims for loss or damage to commodities. (See paragraph (c)(2)(iii) of 
this section.)
    (B) The value of commodities misused, lost or damaged shall be 
determined on the basis of the domestic market price at the time and 
place the misuse, loss or damage occurred, or, in case it is not 
feasible to obtain or determine such market price, the f.o.b. or

[[Page 710]]

f.a.s. commercial export price of the commodity at the time and place of 
export, plus ocean freight charges and other costs incurred by the U.S. 
Government in making delivery to the cooperating sponsor. When value is 
determined on a cost basis, nongovernmental cooperating sponsors may add 
to the value any provable costs they have incurred prior to delivery by 
the ocean carrier. In preparing the claim statement, these costs shall 
be clearly segregated from costs incurred by the U.S. Government. With 
respect to claims other than ocean carrier loss or damage claims, at the 
request of the cooperating sponsor or upon the recommendation of USAID 
or the Diplomatic Post, AID/W may determine that such value may be 
established on some other justifiable basis. When replacement is made, 
the value of commodities misused, lost or damaged shall be their value 
at the time and place the misuse, loss, or damage occurred and the value 
of the replacement commodities shall be their value at the time and 
place replacement is made.
    (C) Amounts collected by nongovernmental cooperating sponsors on 
claims against ocean carriers not in excess of $200 may be retained by 
the nongovernmental cooperating sponsor. On claims involving loss and/or 
damage having a value in excess of $200, nongovernmental cooperating 
sponsors may retain from collections received by them, the larger of:
    (1) The amount of $200 plus 10 percent of the difference between 
$200 and the total amount collected on the claim, up to a maximum of 
$500, or
    (2) Actual administrative expenses incurred in collection of the 
claim if approved by CCC.

Collection costs shall not be deemed to include attorneys fees, fees of 
collection agencies, and the like. In no event will collection costs in 
excess of the amount collected on the claim be paid by CCC. The 
nongovernmental cooperating sponsors may also retain from claim 
recoveries remaining after allowable deductions for administrative 
expenses of collection, the amount of any special charges, such as 
handling, packing, and insurance costs, which the nongovernmental 
cooperating sponsor has incurred on the lost and/or damaged commodity 
and which are included in the claims and paid by the liable party.
    (D) A nongovernmental cooperating sponsor may redetermine claims on 
the basis of additional documentation or information, not considered 
when the claims were originally filed when such documentation or 
information clearly changes the ocean carrier's liability. Approval of 
such changes by CCC is not required regardless of amount. However, 
copies of redetermined claims and supporting documentation or 
information shall be furnished to CCC.
    (E) A nongovernmental cooperating sponsor may negotiate compromise 
settlements of claims regardless of the amount thereof, except that 
proposed compromise settlements of claims having a value in excess of 
$5,000 shall not be accepted until such action has been approved in 
writing by CCC. When a claim is compromised, the nongovernmental 
cooperating sponsor may retain from the amount collected, the amounts 
authorized in paragraph (c)(2)(ii)(C) and in addition, an amount 
representing such percentage of the special charges described in 
paragraph (c)(2)(ii)(C) as the compromised amount is to the full amount 
of the claim. When a claim is not in excess of $600, the nongovernmental 
cooperating sponsor may terminate collection activity on the claim 
according to the standards set forth in the Federal Claims Collection 
Standards, 4 CFR 104.3. Approval of such termination by CCC is not 
required, but the nongovernmental cooperating sponsor shall notify CCC 
when collection activity on a claim is terminated.
    (F) All amounts collected in excess of the amounts authorized herein 
to be retained shall be remitted to CCC. For the purpose of determining 
the amount to be retained by the nongovernmental cooperating sponsor 
from the proceeds of claims filed against ocean carriers, the word 
``claim'' shall refer to the loss and/or damage to commodities which are 
shipped on the same voyage of the same vessel to the same port 
destination, irrespective of the kinds of commodities shipped or the 
number of different bills of lading issued by the carrier. If a 
nongovernmental cooperating sponsor is unable to collect a claim or

[[Page 711]]

negotiate an acceptable compromise settlement within the applicable 
period of limitation or any extension thereof granted in writing by the 
liable party or parties, the rights of the nongovernmental cooperating 
sponsor to the claim shall be assigned to CCC in sufficient time to 
permit the filing of legal action prior to the expiration of the period 
of limitation or any extension thereof. Nongovernmental cooperating 
sponsors shall promptly assign their claim rights to CCC upon request. 
In the event CCC collects or settles the claim after the rights of the 
nongovernmental cooperating sponsor to the claim have been assigned CCC, 
CCC shall, except as shown below, pay to the nongovernmental cooperating 
sponsor the amount the agency or organization would have been entitled 
to retain had they collected the same amount. However, the additional 10 
percent on amounts collected in excess of $200 will be payable only if 
CCC determines that reasonable efforts were made to collect the claim 
prior to the assignment, or if payment is deemed to be commensurate with 
the extra efforts exerted in further documenting claims. In addition, if 
CCC determines that the documentation requirements of paragraph (c)(1) 
have not been fulfilled and the lack of such documentation has not been 
justified to the satisfaction of CCC, CCC reserves the right to deny 
payment of all allowances to the nongovernmental cooperating sponsor.
    (G) When nongovernmental cooperating sponsors fail to file claims, 
or permit claims to become time-barred, or fail to provide for the right 
of CCC to assert such claims, as provided in this Sec. 211.9, and it is 
determined by CCC that such failure was due to the fault or negligence 
of the nongovernmental cooperating sponsor, the agency or organization 
shall be liable to the United States for the cost and freight (C&F) 
value of the commodities lost to the program.
    (iii) If a cargo loss has been incurred on a nongovernmental 
cooperating sponsor shipment, and general average has been declared, the 
nongovernmental cooperating sponsor shall furnish to CCC with a 
duplicate copy to AID/W--
    (A) Copies of booking confirmations and the applicable on-board 
bill(s) of lading,
    (B) The related outturn or survey report(s),
    (C) Evidence showing the amount of ocean transportation charges paid 
to the carrier(s), and
    (D) An assignment to CCC of the cooperating sponsor's right to the 
claim(s) for such loss.

CCC assumes responsibility for general average and marine salvage.
    (iv) A.I.D. will initiate and prosecute claims against ocean 
carriers and defend claims by such carriers, arising from or relating to 
affreightment contracts booked by A.I.D. where the claims involve 
entitlement to freight and related costs from the U.S. Government. 
Proceeds of such claims received by A.I.D. shall be returned to CCC 
pursuant to agreed procedures.
    (d) Fault of cooperating sponsor in country of distribution. If a 
commodity, monetized proceeds or program income is used for a purpose 
not permitted under the Operational Plan or TA or this Regulation, or if 
a cooperating sponsor causes loss or damage to a commodity, monetized 
proceeds or program income through any act or omission or failure to 
provide proper storage, care and handling, the cooperating sponsor shall 
pay to the United States the value of the commodities, monetized 
proceeds or program income, lost, damaged, or misused, unless A.I.D. 
determines that such improper distribution or use, or such loss or 
damage, could not have been prevented by proper exercise of the 
cooperating sponsor's responsibility under the Operational Plan or TA 
and this Regulation. In determining whether there was a proper exercise 
of the cooperating sponsor's responsibility, A.I.D. shall consider 
normal commercial practices in the country of distribution and the 
problems associated with carrying out programs in developing countries. 
Payment by the cooperating sponsor shall be made in accordance with 
paragraph (g) of this section, except that the USAID or Diplomatic Post 
may agree to permit a cooperating sponsor to replace commodities lost, 
damaged, or misused with similar commodities of equal value.

[[Page 712]]

    (e) Fault of others in country of distribution and in intermediate 
country. (1) In addition to survey and/or outturn reports to determine 
ocean carrier loss and damage, the cooperating sponsor shall, in the 
case of landlocked countries, arrange for an independent survey at the 
point of entry into the recipient country and to make a report as set 
forth in paragraph (c)(1) of this section. CCC will reimburse the 
cooperating sponsor for the costs of a survey as set forth in paragraph 
(c)(1)(iv).
    (2) If a cooperating sponsor acquires any right against a person or 
governmental or nongovernmental organization based on an event for which 
the person or organization is responsible that resulted in the damage, 
loss or misuse of any commodity, monetized proceeds or program income, 
the cooperating sponsor shall file a claim against the liable party or 
parties for the value of the commodities, monetized proceeds or program 
income lost damaged or misused and shall make every reasonable effort to 
collect the claim. A copy of the claim and related documents shall be 
provided to USAID or the Diplomatic Post. Cooperating sponsors who fail 
to file or pursue such claims shall be liable to A.I.D. for the value of 
the commodities or monetized proceeds or program income lost, damaged, 
or misused: Provided, however, that the cooperating sponsor may elect 
not to file a claim if the loss is less than $500 and such action is not 
detrimental to the program. Cooperating sponsors may retain $150 of any 
amount collected on an individual claim. In addition, cooperating 
sponsors may, with the written approval of USAID or the Diplomatic Post, 
retain either special costs such as reasonable legal fees that they have 
incurred in the collection of a claim, or pay such legal fees with 
monetized proceeds or program income. Any proposed settlement for less 
than the full amount of the claim must be approved by USAID or the 
Diplomatic Post prior to acceptance. When the cooperating sponsor has 
exhausted all reasonable attempts to collect a claim, it shall request 
USAID or the Diplomatic Post to provide further instructions in 
accordance with paragraph (e)(4).
    (3) Calculation of the amount of a claim against others. A claim is 
the right a cooperating sponsor has against a third party as a result of 
an event for which the third party is responsible that caused the loss, 
damage or misuse of commodities, monetized proceeds or program income. 
The amount of the claim is based on the value of the commodities, 
monetized proceeds or program income lost, damaged or misused as a 
result of the event. An individual claim may not be broken down 
artificially to enlarge the amount the cooperating sponsor may retain as 
an administrative allowance on collection of the claim. For example, if 
a cooperating sponsor has a contract with a carrier to transport 
commodities, and losses occur during a single shipment of commodities 
from points A to B, the cooperating sponsor has one claim against the 
carrier, and the amount of the claim will be based on the total value of 
the commodities lost during the shipment from A to B even though some of 
the loss might have occurred on each of several trucks or by 
subcontractors used by the carrier to satisfy its contract 
responsibility to transport the commodities.
    (4) Reasonable attempts to collect the claim shall not be less than 
the follow-up of initial billings with three progressively stronger 
demands at not more than 30-day intervals. If these efforts fail to 
elicit a satisfactory response, legal action in the judicial system of 
the cooperating country should be pursued unless:
    (i) Liability of the third party is not provable,
    (ii) The cost of pursuing the claim would exceed the amount of the 
claim,
    (iii) The third party would not have enough assets to satisfy the 
claim after a judicial decision favorable to the cooperating sponsor,
    (iv) Maintaining legal action in the country's judicial system would 
seriously impair the cooperating sponsor's ability to conduct an 
effective program in the country, or
    (v) It is inappropriate for reasons relating to the judiciary or 
judicial system of the country.

A cooperating sponsor's decision not to take legal action, and reasons 
therefore, must be submitted in writing to

[[Page 713]]

USAID or the Diplomatic Post for review and approval, and USAID or the 
Diplomatic Post may require the cooperating sponsor to obtain and submit 
the opinion of competent legal counsel to support its decision. A 
cooperating sponsor also may request approval to terminate legal action 
after it has commenced if it is apparent that any of the exceptions 
described above becomes applicable or if it is otherwise appropriate to 
terminate legal action prior to judgment. In each instance, USAID or the 
Diplomatic Post must provide the cooperating sponsor a written 
explanation of its decision within 45 days from the date the request is 
received or inform the cooperating sponsor in writing regarding the 
reason(s) the USAID or Diplomatic Post needs more time to make a 
decision. If USAID or the Diplomatic Post approves a cooperating 
sponsor's decision not to take further action on the claim for reasons 
described in paragraphs (e)(4)(iv) or (v) of this section, the 
cooperating sponsor shall assign the claim to A.I.D. and shall provide 
to A.I.D. all documentation relating to the claim. When USAID or the 
Diplomatic Post takes an assignment of a claim or claims from a 
cooperating sponsor, the USAID or Diplomatic Post shall consult AID/W 
regarding the appropriate action to take on the assigned claim(s), 
unless standing guidance is in effect.
    (5) As an alternative to legal action in the judicial system of the 
country with regard to claims against a public entity of the government 
of the cooperating country, the cooperating sponsor and the cooperating 
country may agree to settle disputed claims by an appropriate 
administrative procedure and/or arbitration. This alternative may be 
established in the Host Country Food for Peace Program Agreement 
required under Sec. 211.3(b), or by a separate formal understanding, and 
must be submitted to USAID or the Diplomatic Post for review and 
approval. Resolution of disputed claims by any administrative procedure 
or arbitration agreed to by the cooperating sponsor and the cooperating 
country should be final and binding on the parties.
    (f) Reporting losses to USAID or the Diplomatic Post. (1) The 
cooperating sponsor shall provide the USAID or Diplomatic Post a 
quarterly report regarding any loss, damage or misuse of commodities, 
monetized proceeds or program income. The report must be provided within 
30 days after the close of the calendar quarter and shall contain the 
following information except for commodity losses less than $500: who 
had possession of the commodities, monetized proceeds or program income; 
who, if anyone, might be responsible for the loss, damage or misuse; the 
kind and quantity of commodities; the size and type of containers; the 
time and place of loss, damage or misuse; the current location of the 
commodities; the program number; CCC contract number, if known, and if 
not known, other identifying numbers printed on the commodity 
containers; the action taken by the cooperating sponsor with respect to 
recovery or disposal; and the estimated value of the loss, damage or 
misuse. If any of this information is not available, the cooperating 
sponsor shall explain why it is not. The report simply may identify 
separately commodity losses valued at less than $500 and indicate the 
estimated value of the commodities lost damaged or misused and the 
action taken by the cooperating sponsor with respect to recovery or 
disposal, except that the cooperating sponsor shall inform the USAID or 
Diplomatic Post if it has reason to believe there is a pattern or trend 
in the loss, damage or misuse of such commodities and provide the 
information described above for losses of $500 or more together with 
such other information available to it. USAID or the Diplomatic Post may 
require additional information about any commodities lost, damaged or 
misused. Information in the quarterly report may be provided in tabular 
form to the extent possible, and the report shall enclose a copy of any 
claim made by the cooperating sponsor during the reporting period.
    (2) If any commodity, monetized proceeds or program income is lost 
or misused under circumstances which give a cooperating sponsor reason 
to believe that the loss or misuse has occurred as a result of criminal 
activity, the cooperating sponsor shall promptly report these 
circumstances to the A.I.D.

[[Page 714]]

Inspector General through AID/W, USAID or the Diplomatic Post, and 
subsequently to the appropriate authorities of the cooperating country 
unless instructed not to do so by A.I.D. The cooperating sponsor also 
shall cooperate fully with any subsequent investigation by the Inspector 
General and/or authorities of the cooperating country.
    (g) Handling claims proceeds. Claims against ocean carriers shall be 
collected in U.S. dollars (or in the currency in which freight is paid, 
or a pro rata share of each) and shall be remitted (less amounts 
authorized to be retained) by nongovernmental cooperating sponsors to 
CCC. With respect to commodities, claims against nongovernmental 
cooperating sponsors shall be paid to CCC or AID/W in U.S. dollars; 
amounts paid by other cooperating sponsors and third parties in the 
country of distribution shall be deposited with the U.S. Disbursing 
Officer, American Embassy, preferably in U.S. dollars with instructions 
to credit the deposit to CCC Account No. 12X4336, or in local currency 
with instructions to credit the deposit to Treasury sales account 
20FT401. Any conversion required for these deposits shall be at the 
highest rate of exchange legally obtainable on the date of deposit 
unless A.I.D. agrees otherwise in writing. With respect to monetized 
proceeds and program income, amounts recovered should be deposited into 
the special interest-bearing account established for the monetized 
proceeds and may be used for purposes of the approved program.
    (h) General average. CCC shall--
    (1) Be responsible for settling general average and marine salvage 
claims;
    (2) Retain the authority to make or authorize any disposition of 
commodities which have not commenced ocean transit or of which the ocean 
transit is interrupted, and receive and retain any monetary proceeds 
resulting from such disposition;
    (3) In the event of a declaration of general average, initiate, 
prosecute, and retain all proceeds of cargo loss and damage claims 
against ocean carriers; and
    (4) Receive and retain any allowance in general average. CCC will 
pay any general average or marine salvage claims determined to be due.



Sec. 211.10  Records and reporting requirements.

    (a) Records. Cooperating sponsors and recipient agencies shall 
maintain records and documents in a manner which accurately reflects the 
operation of the program and all transactions pertaining to the receipt, 
storage, distribution, sale, inspection and use of commodities and to 
receipt and disbursement of any monetized proceeds and program income. 
Such records shall be retained for a period of 3 years from the close of 
the U.S. fiscal year to which they pertain, or longer, upon request by 
A.I.D. for cause, such as in the case of litigation of a claim or an 
audit concerning such records. The cooperating sponsor shall transfer to 
A.I.D. any records, or copies thereof, requested by A.I.D.
    (b) Reports. Cooperating sponsors shall submit two copies of audits 
performed in accordance to Sec. 211.5(c). In addition, cooperating 
sponsors shall submit to USAID or the Diplomatic Post, and to AID/W such 
reports as A.I.D. may reasonably request. The following is a list of the 
principal types of reports that are to be submitted at least annually:
    (1) Periodic summary reports showing receipt, distribution, and 
inventory of commodities and proposed schedules of shipments or calls 
forward.
    (2) Reports relating to the generation of monetized proceeds and 
program income and the use of such funds for purposes specified in the 
Operational Plan or TA. See Sec. 211.5(l).
    (3) Reports relating to progress and problems in the implementation 
of the program.
    (4) Reports shall be submitted in sufficient detail to enable USAID 
or the Diplomatic Post to assess and to make recommendations as to the 
ability of the cooperating sponsors to effectively plan, manage, control 
and evaluate the Food for Peace programs under their administration.
    (5) At the time that an emergency program under Public Law 480, 
title II

[[Page 715]]

is initiated, whether by a governmental or nongovernmental cooperating 
sponsor, USAID or the Diplomatic Post should
    (i) Make a determination regarding the ability of the cooperating 
sponsor to perform the record-keeping required by this Sec. 211.10, and
    (ii) In those instances in which those specific record-keeping 
requirements cannot be followed, due to emergency circumstances, specify 
exactly which essential information will be recorded in order to account 
fully for title II commodities and monetized proceeds.
    (c) Inspection and audit. Cooperating sponsors and recipient 
agencies shall cooperate with and assist U.S. Government representatives 
to enable them at any reasonable time to:
    (1) Examine activities and records of the cooperating sponsor, 
recipient agencies, processors, or others, pertaining to the receipt, 
storage, distribution, processing, repackaging, sale and use of 
commodities by recipients;
    (2) Inspect commodities in storage, or the facilities used in the 
handling or storage of commodities;
    (3) Examine and audit books and records, including financial books 
and records and reports pertaining to storage, transportation, 
processing, repackaging, distribution, sale and use of commodities and 
pertaining to the deposit and use of any monetized proceeds and program 
income;
    (4) Review the overall effectiveness of the program as it relates to 
the objectives set forth in the Operational Plan or TA; and
    (5) Examine or audit the procedure and methods used in carrying out 
the requirements of this Regulation.

Inspections and audits of title II emergency programs will take into 
account the circumstances under which such programs are carried out.



Sec. 211.11  Suspension, termination, and expiration of program.

    (a) Termination or suspension by A.I.D. All or any part of the 
assistance provided under the program, including commodities in transit, 
may be terminated or suspended by A.I.D. at its discretion if AID/W 
determines that a cooperating sponsor has failed to comply with the 
provisions of the approved Operational Plan or TA, or of this 
Regulation, or that the continuation of such assistance is no longer 
necessary or desirable. If AID/W believes that circumstances permit, 
AID/W will provide a nongovernmental cooperating sponsor written notice 
of A.I.D.'s intention to terminate or suspend the cooperating sponsor's 
program, together with an explanation of the reason(s) for A.I.D.'s 
action, at least 30 days prior to the date indicated in the notice that 
the program will be terminated or suspended. Comments provided by the 
nongovernmental cooperating sponsor prior to the effective date of the 
termination or suspension shall be considered by AID/W in determining 
whether to rescind the notice. When a program is terminated or 
suspended, title to commodities which have been transferred to the 
cooperating sponsor, or monetized proceeds, program income and real or 
personal property procured with monetized proceeds or program income 
shall, at the written request of USAID, the Diplomatic Post or AID/W, be 
transferred to the U.S. Government by the cooperating sponsor or shall 
otherwise be transferred by the cooperating sponsor as directed by 
A.I.D. Any then excess commodities on hand at the time the program is 
terminated shall be disposed of in accordance with Sec. 211.5 (o) and 
(p) or as otherwise instructed by USAID or the Diplomatic Post. If it is 
determined that any commodity authorized to be supplied under the 
Operational Plan or TA is no longer available for Food for Peace 
programs, such authorization shall terminate with respect to any 
commodities which, as of the date of such determination have not been 
delivered f.o.b. or f.a.s. vessel, provided that every effort will be 
made to give adequate advance notice to protect cooperating sponsors 
against unnecessarily booking vessels.
    (b) Expiration of program. Upon expiration of the approved program 
under circumstances other than those described in paragraph (a), the 
cooperating sponsor shall deposit with the U.S. Disbursing Officer, 
American Embassy, with instructions to credit the deposit

[[Page 716]]

to CCC Account No. 20FT401, any remaining monetized proceeds or program 
income, or the cooperating sponsor shall obtain approval from AID/W for 
the use of such monetized proceeds or program income, or real or 
personal property procured with such proceeds or income, for purposes 
consistent with those authorized for support from A.I.D.



Sec. 211.12  Waiver and amendment authority.

    The Assistant Administrator for Food and Humanitarian Assistance, 
A.I.D., may waive, withdraw, or amend, at any time, any or all of the 
provisions of this Regulation 11 if such provision is not statutory and 
it is determined to be in the best interest of the U.S. Government to do 
so. Any cooperating sponsor which has failed to comply with the 
provisions of this Regulation or any instructions or procedures issued 
in connection herewith, or any agreements entered into pursuant hereto 
may at the discretion of A.I.D. be suspended or disqualified from 
further participation in any distribution program. Reinstatement may be 
made at the option of A.I.D. Disqualification shall not prevent A.I.D. 
from taking other action through other available means when considered 
necessary.

                Appendix I to Part 211--Operational Plan

     A. General Outline of Operational Plans for Title II Activities

    In addition to any other requirement of law or regulation, the 
Operational Plan will include information outlined below to the extent 
it is applicable to the specific activity.
    1. Program Goals.
    Describe program goals and criteria for measuring progress toward 
reaching the goals. Each program should be designed to achieve 
measurable objectives within a specified period of time.
    2. Program Description.
    a. Describe the characteristics, extent and severity of problems 
that the program will address.
    b. Provide a clear concise statement of specific objectives for each 
program and of criteria for measuring progress towards reaching the 
objectives. If there are several objectives, indicate priorities.
    c. Describe the target population by program, including economic/
nutrition-related characteristics, sufficiently to permit a 
determination of recipient eligibility for title II commodities. 
Describe the educational and employment characteristics of the target 
group, if relevant to program objectives; the rationale for selection of 
the target group, the rationale for the selection of the geographical 
areas where programs will be carried out; the calculation of coverage 
and the percent of total target population reached.
    d. Describe the intervention including:
    (1) Ration composition. A description of rations, rationale for size 
and composition, assessment of effectiveness (dilution, sharing, 
acceptance).
    (2) Complementary program components and inputs. Identify existing 
or potential complementary program components, i.e., education, growth 
monitoring, training, etc., that are necessary to achieve program 
impact, including determination of financial costs and sources of 
funding.
    (3) Monetization. Describe to whom the commodities will be sold; the 
sales price (which shall not be less than the value of the food 
commodities f.a.s. or f.o.b.); arrangements for deposit of the 
monetization proceeds in a special (segregated), interest bearing 
account, pending use of the proceeds plus interest for the program; and 
the capability of the cooperating sponsor and recipient agencies to use 
and account for monetized proceeds properly as well as technical 
assistance the cooperating sponsor intends to obtain or provide if 
necessary in order to ensure that there are adequate financial and other 
management systems for the program proposed.
    (4) Intervention strategy. Describe how the commodities, 
monetization proceeds, program income and other program components will 
address the problems. Indicate the recipient agencies to which 
commodities, monetized proceeds or program income will be transferred, 
and identify those recipient agencies which will not be required to 
execute Recipient Agency Agreements, and provide a brief explanation of 
the reasons.
    (5) Linkages with other development activities, such as health or 
agricultural extension services. Describe specific areas of 
collaboration relative to program purposes.
    (6) Monitoring and evaluation. Include a description of the 
evaluation plan, including information to be collected for purposes of 
assessing program operations and impact. Describe the monitoring system 
for collection, analysis and utilization of information. Include a 
schedule for carrying out the evaluation as well as a plan for 
conducting audits (Regulation 11, section 211.5(c)).
    (7) Program period. The Operational Plan should cover enough time 
for a program to become fully operational and to permit evaluation of 
its effectiveness, including specific measurement of progress in 
achieving the

[[Page 717]]

stated program goals. Normally this will be a multi-year time frame, 
such as three to five years. Plans for and considerations involved in 
phasing-out U.S.G. support, and any phasing-over to non-U.S.G. support, 
should be discussed.
    3. Program funding. Provide details of host government, cooperating 
sponsor and other non-USG support for the proposed program, with 
specific budgetary information on how these funds are to be used (e.g. 
complementary inputs, transport, administration). Where relevant, 
discussion of arrangements which will be made covering voluntary 
contributions.
    4. Publicity. Describe how the requirements for public recognition, 
container marking, and use of funds set forth in Regulation 11, 
Secs. 211.5i(h), (i) and (k) and in 211.6 (a) and (b), will be met.
    5. Logistics. Provide a logistics plan that demonstrates the 
adequacy and availability in recipient country of port facilities, 
transportation and storage facilities to handle the flow of commodities 
to recipients to prevent spoilage or waste. A further affirmation must 
be made at the time of exportation of the commodity from the United 
States.
    6. Disincentives. Furnish sufficient information concerning the plan 
of distribution and the target group of recipients so that a 
determination can be made as to whether the proposed food distribution 
would result in substantial disincentive to domestic food production. It 
is not necessary to provide a disincentive analysis if A.I.D. or USDA 
has completed such an analysis for another program that is relevant to 
the program proposed by the cooperating sponsor.
    7. Accountability. Describe the method to be used to supervise, 
monitor, and account for the distribution or sale of commodities and the 
use of monetized proceeds and program income.
    8. Import duty. Provide information to show approval of foreign 
government to import the donated commodities duty free.
    9. Voluntary agency regular programs. An Operational Plan is 
required for all regular, i.e., non-emergency, title II nongovernmental 
cooperating sponsor programs as part of their program submission, along 
with the Annual Estimate of Requirements (AER), to USAID or the 
Diplomatic Post and AID/W. When new multi-year Operational Plans are 
required, they should be prepared and submitted in advance of the year 
in which they are to begin, in order to permit adequate time for 
substantive review and approval. In any event, nongovernmental 
cooperating sponsor Operational Plans should be submitted to AID/W no 
later than the Mission Action Plan covering the following fiscal year's 
program. Once an Operational Plan has been approved, only an updating 
will be required on an annual basis, unless there has been a significant 
change from the approved plan's program directives, methodology, design 
or magnitudes. Updates should be submitted each year for review with the 
AERs.

               B. Operational Plans for Emergency Programs

    The response to emergency situations using title II resources does 
not usually permit the same degree of detail and certainty of analysis 
that is expected in planning title II non-emergency programs. However, 
Operational Plans are required for all nongovernmental cooperating 
sponsors' emergency programs, along with the AER. An Operational Plan 
for an emergency program must cover the same basic elements, set forth 
above, as for a nonemergency program. Thus, all of the above basic 
issues set forth in the Operational Plan format must be addressed when 
proposing title II emergency programs as well as regular nonemergency 
programs.

                C. USAID/Diplomatic Post Responsibilities

    A USAID or Diplomatic Post is expected to comment on the substance 
and adequacy of a nongovernmental cooperating sponsor's Operational Plan 
when submitted to AID/W along with a program request, and to address the 
plan's relationship to and consistency with the Mission's Country 
Development Strategy Statement.

                 D. Required Approval for Program Change

    Cooperating sponsors agree not to deviate from the program as 
described in the Operational Plan and other program documents approved 
by A.I.D., without the prior written approval of A.I.D.

                E. Emergency Assistance Program Requests

    Any cooperating sponsor (governmental or nongovernmental) may 
initiate an emergency assistance proposal under Public Law 480, title 
II. Requests are received by a USAID or Diplomatic Post and reviewed and 
approved before forwarding to AID/W with appropriate recommendations.
    a. Nongovernmental emergency program requests can be cabled by USAID 
or the Diplomatic Post for AID/W review based on information provided 
and using procedures established for regular programs as described in 
Regulation 11, Sec. 211.5(a): AER and Operational Plan.
    b. A foreign government or international organization (other than 
World Food Program) emergency request normally requires more Mission 
involvement in program design and management. However, as in the case of 
nongovernmental programs, the approval will be based on a cabled program 
summary based on the program plan outlined in (2) above. On approval, 
AID/W will prepare a Transfer Authorization (TA) to be signed by the 
recipient government specifying terms of the program and reporting 
requirements. Additional guidance in preparing government-

[[Page 718]]

to-government or international organizations emergency requests is in 
chapter 9 and Exhibit A of A.I.D. Handbook 9. The TA serves as (1) the 
Food for Peace Agreement between the U.S. Government and the cooperating 
sponsor, (2) the project authorization document, and (3) the authority 
for the CCC to ship commodities. (Under Pub. L. 480, section 207(a), not 
later than 15 days after receipt of a call forward from a field mission 
for commodities, the order shall be transmitted to the CCC.)

    F. Local Currency Programs (Public Law 480, Title II Section 203)

    Detailed guidance for preparing, approving, implementing and 
administering these programs is provided in chapters 6, 7, and 11 of 
A.I.D. Handbook 9.

         G. Problems Conducting Programs In Developing Countries

    Describe the problems that can be anticipated in implementing the 
program in the recipient country as a result of its being a developing 
country.

                               H. Waivers

    A cooperating sponsor should provide a justification for the waiver 
of any specific section or sections of Regulation 11 that it believes 
necessary for the program.



PART 212--PUBLIC INFORMATION--Table of Contents




                           Subpart A--General

Sec.
212.1  Statement of policy.

             Subpart B--Publication in the Federal Register

212.11  Materials to be published.
212.12  Effect of nonpublication.
212.13  Incorporation by reference.

Subpart C--Availability of Information for Public Inspection and Copying

212.21  Public records.
212.22  Protection of personal privacy.
212.23  Current index.
212.24  Effect of noncompliance.
212.25  Procedures for obtaining materials under this subpart.

                   Subpart D--Access to Agency Records

212.31  Availability of agency records.
212.32  Identification of records.
212.33  Procedure for making requests.
212.34  Procedures for responding to requests for records.
212.35  Schedule of fees and methods of payment for services rendered.
212.36  Denial of request for access to records.
212.37  Procedures for agency consideration of appeals.
212.38  Predisclosure notification procedures for confidential 
          commercial information.

                  Subpart E--Exemptions From Disclosure

212.41  Exemptions from publication and disclosure requirements of 
          subparts B, C, and D.
212.42  Exemption from 5 U.S.C. 552.

    Subpart F--Opening of Records for Nonofficial Research Purposes.

212.51  General Policy

    Authority:  22 U.S.C. 2381(a).

    Source:  61 FR 43002, Aug. 20, 1996, unless otherwise noted.



                           Subpart A--General



Sec. 212.1  Statement of policy.

    (a) It is the policy of the United States Agency for International 
Development (hereinafter ``USAID'' or ``the Agency'') that information 
about its objectives and operations be freely available to the public in 
accordance with the provisions of the Freedom of Information Act 
(``FOIA''), 5 U.S.C. 552, as amended; the President's Memorandum for 
Heads of Departments and Agencies regarding the FOIA, 29 Weekly Comp. 
Pres. Doc. 1999 (October 4, 1993); and the Attorney General's Memorandum 
of the same title and date. The Director, Office of Administrative 
Services, Bureau for Management, or his/her designee, is responsible on 
behalf of the Agency for administration of the provisions of the 
regulations set forth in this part.
    (b) In addition, concerning the International Cooperation and 
Development Agency (``IDCA''), pursuant to executive order and 
delegations of authority USAID is responsible not only for management of 
its own affairs but also for those of IDCA. The policy of IDCA in the 
FOIA area has been determined by USAID to be identical to that of USAID, 
as stated in this section. Therefore, all policies and procedures set 
forth in this part apply equally to IDCA as to USAID; and it is intended 
that references in this part to ``USAID'' or ``the Agency'' shall, 
wherever appropriate, include or mean a

[[Page 719]]

reference to IDCA. Accordingly, all IDCA FOIA-related matters shall be 
referred to and processed by USAID staff under this part as though they 
were USAID matters.
    (c) All records of USAID shall be made available to the public upon 
compliance with the procedures established in Sec. 212.33, except to the 
extent a determination is made to withhold a record exemptible under 5 
U.S.C. 552(b). Such a determination shall be made pursuant to procedures 
set forth in Sec. 212.36, 212.37 and 212.38.
    (d) The term ``record'' as used in this part includes all books, 
papers, maps, photographs, or other documentary material or copies 
thereof, regardless of physical form or characteristics, made in or 
received by USAID (including its missions or offices abroad), and 
preserved as evidence of its organization, functions, policies, 
decisions, procedures, operations, or other activities. The term does 
not include copies of the records of other U.S. Government agencies, 
foreign governments, international organizations, or non-governmental 
entities which do not evidence organization, functions, policies, 
decisions, procedures, operations, or activities of USAID.



             Subpart B--Publication in the Federal Register



Sec. 212.11  Materials to be published.

    (a) USAID separately states and currently publishes in the Federal 
Register for the information and guidance of the public:
    (1) Descriptions of its central and field organization and the 
established places at which, the officers from whom, and the methods 
whereby, the public may secure information, make submittals or requests, 
or obtain decisions;
    (2) Statements of the general course and method by which its 
functions are channelled and determined, including the nature and 
requirements for all formal and informal procedures available;
    (3) Rules of procedure, descriptions of forms available or the 
places at which forms may be obtained, and instructions as to the scope 
and contents of all papers, reports, or examinations;
    (4) Substantive rules of general applicability adopted as authorized 
by law, and statements of general policy or interpretations of general 
applicability formulated and adopted by USAID; and
    (5) Every amendment, revision or repeal of the material listed in 
this section.
    (b) USAID Public Notice No. 1 and the USAID Regulations published in 
chapter II of Title 22 and in subtitle A, Chapter 7 of Title 41 of the 
Code of Federal Regulations implement the provisions of this section.



Sec. 212.12  Effect of nonpublication.

    The materials referenced in Sec. 212.11 shall not be binding upon or 
otherwise adversely affect a person unless either
    (a) The materials were in fact published in the Federal Register or
    (b) The person otherwise had actual and timely notice of the content 
of such materials.



Sec. 212.13  Incorporation by reference.

    For purposes of this subpart B, USAID matters which are reasonably 
available to the class of persons affected thereby are deemed to be 
published in the Federal Register when they have been incorporated by 
reference therein with the approval of the Director of the Federal 
Register.



Subpart C--Availability of Information for Public Inspection and Copying



Sec. 212.21  Public records.

    In accordance with this subpart, USAID makes the following 
information and materials available for public inspection and copying:
    (a) All final opinions (including concurring and dissenting 
options), and all orders made in the adjudication of the cases:
    (b) those statements of policy and interpretations which have been 
adopted by the Agency and are not published in the Federal Register; and
    (c) Administrative staff manuals and instructions to staff that 
affect any member of the public.

[[Page 720]]



Sec. 212.22  Protection of personal privacy.

    To the extent required to prevent a clearly unwarranted invasion of 
personal privacy, USAID may delete identifying details when USAID makes 
available or publishes an opinion, statement of policy, interpretation, 
or staff manual or instruction. USAID will, in each such case, explain 
in writing the justification for the deletion.



Sec. 212.23  Current index.

    USAID maintains and makes available for public inspection and 
copying a current index providing identifying information for the public 
as to any matter which has been issued, adopted, or promulgated after 
July 4, 1967, and which is required by Sec. 212.21 to be made available 
or published. Publication of an index is deemed both unnecessary and 
impractical. However, copies of the index are available, upon request, 
for a fee based on the direct cost of duplication.



Sec. 212.24  Effect of noncompliance.

    No final order, opinion, statement of policy, interpretation, or 
staff manual or instruction that affects any member of the public will 
be relied upon, used, or cited as precedent by USAID against any private 
party unless it has been indexed and either made available or published 
as provided by this subpart, or unless that private party shall have 
actual and timely notice of the terms thereof.



Sec. 212.25  Procedures for obtaining materials under this subpart.

    (a) The materials required to be made available for public 
inspection and copying in accordance with this subpart are available to 
members of the public at USAID's Public Reading Room, Room 1113, 1621 
North Kent Street, Rosslyn, Virginia 22209, which is open from 9 a.m. to 
5 p.m., Monday through Friday, except on holidays. All such materials 
are available in electronic form (disks) only; to a reasonable degree, 
assistance will be provided in use of necessary equipment.
    (b) Requests for materials which are available under this subpart 
should follow the procedures under Sec. 212.33(a) of this part.
    (c) The direct costs of any necessary duplication will be charged in 
accordance with the fee schedule set forth in Sec. 212.35.
    (d) USAID Missions and offices in countries abroad are not 
responsible for the maintenance of the index and materials available 
under this subpart. However, insofar as they do have these materials, 
they will make them available to citizens of the United States who are 
present in their respective countries upon application made either or in 
person in writing to the USAID Director, or other principal USAID 
officer, c/o American Embassy in the applicable country.



                   Subpart D--Access to Agency Records



Sec. 212.31  Availability of agency records.

    Upon receiving a request which reasonably describes a USAID record, 
and which is made in accordance with the provisions of this subpart, 
USAID will make such records, except the following, promptly available 
to the requesting party:
    (a) Matters published in the Federal Register pursuant to subpart B;
    (b) Matters made available to the public pursuant to subpart C; and
    (c) Matters exempt from disclosure pursuant to Sec. 212.41 or 
Sec. 241.42 of this part.



Sec. 212.32  Identification of records.

    The request for a record by a member of the public must contain a 
reasonably specific description of the particular record sought so that 
a USAID officer who is familiar with the subject matter of the request 
may be able to locate the record with a reasonable amount of effort. A 
description that includes as much information as possible, such as the 
subject matter, format, approximate date and, where pertinent, the name 
of the country or person involved, will facilitate the search for the 
requested record.



Sec. 212.33  Procedure for making requests.

    (a) Requests for records, other than records available at the Public 
Reading Room identified in Sec. 212.24(a), may be made by a member of 
the public in

[[Page 721]]

writing only to the Chief, Customer Outreach and Oversight Staff, Room 
1113, SA-16, Agency for International Development, Department of State, 
320 21st Street, N.W., Washington, D.C. 20523-1608. The request and the 
envelope must be plainly marked ``FOIA Request.'' Requests may be made 
orally, that is, in person, only for records and materials available at 
the Public Reading Room.
    (b) Requests for records may be made directly to a USAID mission or 
office abroad only by a citizen of the United States who is present in 
that country and must be by written application to the USAID Director 
(or other principal USAID officer), care of the American Embassy in that 
country. Any such written request and its envelope must be plainly 
marked ``FOIA Request.''
    (c) Only signed original (as opposed to electronically transmitted) 
requests are acceptable for procedures pursuant to paragraphs (a) and 
(b) of this section. Telephoned requests, or in-person requests other 
than to the Public Reading Room, cannot be accepted. If a written 
request not properly marked ``FOIA Request'' on both the letter and 
envelope is thereby delayed in reaching the Chief, Office of Customer 
Outreach and Oversight Staff, such request will not be deemed received 
by USAID until actually received by that official. In the event of such 
a delay, the person making the request will be furnished a notice of the 
effective date of receipt.



Sec. 212.34  Procedures for responding to requests for records.

    (a) Upon receipt by the Chief, Office of Customer Outreach and 
Oversight Staff, of a reasonably specific request made pursuant to 
Sec. 212.33 of this part, a maximum of ten working days will normally be 
taken to determine to what extent the Agency can provide the information 
requested. Upon the making of that determination, the person making the 
request will be promptly so informed. Copies of the releasable documents 
will be made available promptly thereafter upon receipt of applicable 
fees and charges as set forth in Sec. 212.35.
    (b)(1) In unusual circumstances, USAID may not be able to determine 
the availability of the requested documents within ten working days, in 
which event the person making the request will be informed by written 
notice of the delay, the reasons for the delay and the date on which a 
determination may be expected. In this context, the term ``unusual 
circumstances'' refers to the following situations:
    (i) When there is a need to search for and collect the requested 
records from field facilities or other establishments that are separate 
from the office processing the request;
    (ii) When there is a need to search for, collect, and appropriately 
examine a voluminous amount of separate and distinct records which are 
sought in a single request; or
    (iii) When there is a need for consultation (which will be conducted 
with all practicable speed) with another agency having a substantial 
interest in the determination of the request or among two or more 
components of the Agency, each having substantial subject-matter 
interest therein.
    (2) The maximum time in making a determination of availability, in 
the event of such unusual circumstances, will be twenty working days 
from receipt of the request. In the event that only part of the 
permissible ten working days extension is used, then USAID reserves the 
right, if necessary, to use any remainder of such time for the 
determination of an appeal, if one is made.
    (c) If a request is made to USAID for material that is controlled or 
held by another agency, the person making the request will be 
immediately notified that USAID does not have or control the requested 
material and he/she will be advised of the name of the controlling 
agency and of the address from which the material may be requested, 
unless the other agency has, by public regulation, delegated the release 
authority to USAID. If release authority has been delegated, USAID will 
follow the procedures authorized by the delegation in determining 
whether to release the information. If a request for material is 
referred to USAID from another agency, the time period for determination 
of release of the information will not start until the request is 
received by the Chief, Office of Customer Outreach and Oversight Staff; 
and the

[[Page 722]]

person making the request will be immediately notified of the referral 
and of the date the request was received in USAID. USAID will not accept 
referral of requests unless and until the Chief, Customer Outreach and 
Oversight Staff, or his/her designee, determines that the material 
requested is actually within the scope and control of the release 
authority of USAID.
    (d) If only a part of a record is exempt from disclosure, then any 
reasonably segregable portion of such record will be furnished after 
deletion of the portions which are exempt, provided that the segregable 
portion constitutes an intelligible record which is not distorted out of 
context or contradictory to the substance of the entire record before 
segregation.



Sec. 212.35  Schedule of fees and method of payment for services rendered.

    (a) Definitions. (1) Direct costs means those expenditures which the 
Agency actually incurs in searching for and duplicating (and in the case 
of commercial requesters, reviewing) documents in order to respond to a 
FOIA request.
    (2) Search includes all time spent looking for material that is 
responsive to a request, including page-by-page or line-by-line 
identification of material within documents. Line-by-line search will 
not be done when duplicating an entire document would prove the less 
expensive and quicker method of complying with a request. (``Search'' 
for this purpose is distinguished from ``review'' (see paragraph (a)(4) 
of this section).
    (3) Duplication refers to the process of making a copy of a document 
available to the FOIA requester. Copies can take the form of paper copy, 
microfilm or audiovisual materials (among others) and will be in a form 
that is reasonably usable by requesters.
    (4) Review refers to the process of examining documents located in 
response to a commercial use request (see paragraph (a)(5) of this 
section) to determine whether any portion of any document located is 
permitted to be withheld. It also includes processing any documents for 
disclosure, e.g., doing all that is necessary to redact those documents 
of exempt material and otherwise preparing them for release. Review does 
not include time spent resolving general legal or policy issues 
regarding the application of exemptions.
    (5) Commercial use request refers to a request from or on behalf of 
one who seeks information for a use or purpose that is related to 
commerce, trade, or the profit interest of the requester or of the 
person on whose behalf the request is made. In determining whether a 
requester properly belongs in this category, the Agency will determine 
the use to which a requester will put the documents requested. Where the 
Agency has reasonable cause to doubt the use to which a requester will 
put the records sought, or where that use is not clear from the request 
itself, the Agency may seek additional clarification before assigning 
the request to a specific category.
    (6) Educational institution refers to a preschool, a public or 
private elementary or secondary school, an institution of graduate 
higher education, an institution of undergraduate higher education, an 
institution of professional education, or an institution of vocational 
education which operates a program or programs of scholarly research.
    (7) Non-commercial scientific institution refers to an institution 
that is not operated on a ``commercial'' basis as that term is 
referenced in paragraph (a)(5) of this section and which is operated 
solely for the purpose of conducting scientific research, the results of 
which are not intended to promote any particular product or industry.
    (8) Representative of the news media refers to any person actively 
gathering news for an entity that is organized and operated to publish 
or broadcast news to the public. The term ``news'' means information 
that is about current events or that would be of current interest to the 
public. Examples of news media entities include television or radio 
stations broadcasting to the public at large, and publishers of 
periodicals (but only in those instances when they can qualify as 
disseminators of ``news'' who make their products available for purchase 
or subscription by the general public). These examples are not intended 
to be all-inclusive. Moreover, as traditional methods of

[[Page 723]]

news delivery evolve (e.g., electronic dissemination of newspapers 
through telecommunications services), such alternative media would be 
included in this category. In the case of ``freelance'' journalists, 
they may be regarded as working for a news organization if they can 
demonstrate a sound basis for expecting publication through such an 
organization, even though not actually employed by it. A publication 
contract would be the clearest evidence, but the Agency may also look to 
the past publication record of the requester in making this 
determination.
    (b) Fees to be charged. The following specific fees shall be 
applicable with respect to services rendered to members of the public 
under this part:
    (1) Commercial use requesters. Fees are intended to cover the full 
estimated direct costs of researching for, reviewing for release, and 
duplicating the records requested. Search costs are computed based on 
the following formula: hours spent by Agency personnel, whatever their 
grade and location, and rounded up to the nearest full hour, and 
including locality pay for Washington-based personnel only, at the basic 
annual rate then payable to U.S. Government employees at the GS-9/Step 4 
level, times 1.17 (to factor in related benefits) and divided by 2080 
(hours per work year). Review costs are computed based on the same 
formula but, instead, using the rate then payable to employees at the 
GS-13/Step 4 level. Duplicating costs are $0.20 per page. Search costs 
will be assessed even though no records may be found or even if, after 
review, there is no disclosure of records.
    (2) Educational and non-commercial scientific institution requester. 
The Agency will provide documents to requesters in this category for the 
cost of duplication alone ($0.20 per page), excluding charges for the 
first 100 pages. To be eligible for inclusion in this category, 
requesters must show that a request is being made under the auspices of 
a qualifying institution and that the records are sought in furtherance 
of scholarly research, if the request is from an educational institution 
or scientific research, if the request is from a non-commercial 
scientific institution. Requesters eligible for free search must (as 
with all FOIA requesters) reasonably describe the records sought.
    (3) Requesters who are representatives of the news media. The Agency 
will provide documents to requesters in this category for the cost of 
reproduction alone ($0.20 per page), excluding charges for the first 100 
pages. To be eligible for inclusion in this category a requester must 
meet the criteria in paragraph (a)(8) of this section, and his/her 
request must not be made for commercial use. In reference to this class 
of requesters, a request for records supporting the news dissemination 
function of the requester shall not be considered to be a request that 
is for a commercial use. Requesters eligible for free search must also 
reasonably describe the records sought.
    (4) All other requesters. The Agency will charge requesters who do 
not fit into any of the categories in paragraphs (b) (1), (2), and (3) 
of this section fees which recover the full direct cost of search, and 
for reproducing records that are responsive to the request, except that 
the first 100 pages and the first two hours of search time shall be 
furnished without charge. The hourly rates outlined in paragraph (b)(1) 
of this section will prevail. Requesters must reasonably describe the 
records sought. Moreover, requests from subjects for records filed in 
the Agency's Privacy Act System of Records will continue to be treated 
under the fee provisions of the Privacy Act of 1975 except that the 
first 100 pages of reproduction will be furnished without charge.
    (c) Non-payment of fees. (1) The Agency will begin assessing 
interest charges on the thirty-first day following the day on which the 
requester is advised of the fee charge. Interest will be at the rate 
prescribed in 31 U.S.C. 3717.
    (2) Where a requester has previously failed to copy a fee charged in 
a timely fashion (i.e. within thirty days of the billing date), the 
Agency will require the requester to pay the full amount owed plus any 
applicable interest as provided in paragraph (c)(1) of this section, and 
to make an advance payment of the full amount of the remaining estimated 
fee before the Agency begins to process a new request or continues

[[Page 724]]

processing a then-pending request from the requester.
    (3) When the Agency acts under paragraph (c) (1) or (2) of this 
section the administrative time limits prescribed in subsection (a)(6) 
of the FOIA (i.e., ten working days from receipt of initial request and 
twenty working days from receipt of appeals from initial denial plus 
permissible extensions of these time limits) will begin only after the 
Agency has received fee payments described in this section.
    (d) Advance payments or confirmation. Where USAID estimates or 
determines that allowable charges to a requester are likely to exceed 
$250, USAID will require a requester to make an advance payment of the 
entire estimated charges before continuing to process the request. Where 
the estimated charges are in the $25-$250 range, then USAID in its 
discretion, before processing the request, may require either--
    (1) An advance deposit of the entire estimated charges or (2) 
Written confirmation of the requester's willingness, when billed, to pay 
such charges.
    (e) Waiving or reducing fee. In accordance with section (4)(A)(ii) 
of the FOIA, the Agency will furnish documents without charge or at 
reduced charges if disclosure of the information is ``in the public 
interest'' in that such disclosure is likely to contribute significantly 
to public understanding of the operations or activities of the 
Government and is not primarily in the commercial interest of the 
requester. A requester may at any time, up to a period not to exceed 
thirty days from the final USAID decision concerning his/her request, 
request such waiver or reduction of fee by letter addressed to the 
Chief, Customer Outreach and Oversight Staff; such request shall address 
the above criteria for waiver. Such request will initially be decided by 
the Chief, Customer Outreach and Oversight Staff, or his/her designee; 
such decision will normally be made, and the requester so advised, 
within ten working days of its receipt. The requester, if dissatisfied 
with that decision, may appeal pursuant to the same procedures as apply 
under Sec. 212.36 and Sec. 212.37 of this part.
    (f) Restrictions on assessing fees. With the exception of requesters 
seeking documents for a commercial use, Section (4)(A)(iv) of the FOIA, 
as amended, requires agencies to provide the first 100 pages of 
duplication and the first two hours of search time without charge. 
Moreover, this section prohibits agencies from charging fees to any 
requester, including commercial use requesters, if the cost of 
collecting a fee would be equal to or greater than the fee itself. These 
provisions work together so that, except for commercial use requesters, 
the Agency will not begin to assess fees until it has provided such free 
search and reproduction. For example, for a request that involved two 
hours and ten minutes of search time and resulted in 105 pages of 
documents, the Agency will determine the cost of only ten minutes of 
search time and only five pages of reproduction. If this cost is equal 
to or less than the cost of processing the payment instrument--a figure 
which the Agency will from time to time review and determine--then there 
will be no charge to the requester.
    (g) Other provisions--(1) Charges for unsuccessful search. The 
Agency will assess charges for time spent searching even if the Agency 
fails to locate the records or if records located are determined to be 
exempt from disclosure.
    (2) Aggregating requesters. When the Agency reasonably believes that 
a requester or group of requesters is attempting to break a request down 
into a series of requests for the purpose of evading the assessment of 
fees, the Agency will aggregate any such requesters and charge 
accordingly.
    (3) Effect of the Debt Collection Act of 1982 (Public Law 97-365). 
The Agency will use the authorities of the Debt Collection Act, 
including disclosure to consumer reporting agencies and use of 
collection agencies, where appropriate, to encourage repayment.
    (4) Remittances. (i) Remittances will be in U.S. Dollars in the form 
of either a personal check or bank draft drawn on a bank in the United 
States or a money order.
    (ii) Remittances shall be made payable to the order of the U.S. 
Treasury and mailed to the Chief, Customer Outreach and Oversight Staff, 
at the address set forth in Sec. 212.33(a) of this part.

[[Page 725]]



Sec. 212.36  Denial of request for access to records.

    (a) If it is determined that the Agency cannot comply with all or 
part of a request for records, the person making the request shall be 
immediately notified of the determination, the reasons for the 
determination, the name and title of each officer responsible for the 
denial, and the right of the person to appeal the adverse determination.
    (b) The denial of a request for records may be made, initially, only 
by the Chief, Customer Outreach and Oversight Staff, or his/her 
designee.
    (c) (1) Any person who has been denied access to records pursuant to 
this section may appeal the relevant decision not later than thirty days 
after the date of the notification of denial or, in the case of a 
partial denial, not later than thirty days after the date the releasable 
documents are actually furnished to the person making the request, 
whichever is later. The appeal shall be in writing addressed to the 
Agency's FOIA Appeals Officer, who is:

The Director, Office of Administrative Services, Bureau for Management, 
Room 803, SA-2, Agency for International Development, 21st and Virginia 
Ave., N.W., Washington, D.C., 20523-0217.

    (2) In order for the Agency to make a timely response to the appeal, 
both the text of the appeal and its envelope must be plainly marked 
``FOIA Appeal''. The appeal must contain a reasonable description of the 
record sought and withheld, a copy of the initial decision to deny 
access and any other information that will enable the Appeals Officer to 
make the final decision.



Sec. 212.37  Procedures for agency consideration of appeals.

    (a) Upon receipt of the appeal by the Appeals Officer, a maximum of 
twenty working days will normally be taken to decide the appeal. In 
unusual circumstances, as defined in Sec. 212.34, the twenty working 
days may be extended by ten working days or by the number of days not 
used in the original denial of the request.
    (b) If the appeal is granted, the person making the appeal shall be 
immediately notified and copies of the releasable documents shall be 
made available promptly thereafter upon receipt of appropriate fees as 
set forth in Sec. 212.35. If the appeal is denied in whole or part, the 
person making the request shall be immediately notified of the decisions 
and of the provisions for judicial review of the Agency's denial of the 
request.
    (c) In the event a determination is not issued within the applicable 
time limit and the person making the request therefore chooses to sue 
the Agency, the Agency-level determination process shall nonetheless 
continue.
    (d) If an appeal not properly marked ``FOIA Appeal'' on the text of 
the appeal and/or envelope is thereby delayed in reaching the Appeals 
Officer, it will not be deemed received by the Appeals Officer until 
actually received by him/her. In such event, the person making the 
appeal will be furnished notice of the effective date of receipt.



Sec. 212.38  Predisclosure notification procedures for confidential commercial information.

    (a) In general. Confidential commercial information provided to the 
Agency shall not be disclosed pursuant to a FOIA request except in 
accordance with this section. For purposes of this section, the 
following definitions apply:
    (1) Confidential commercial information means records provided to 
the Agency by a submitter that arguably contain material exempt from 
release under Exemption 4 of FOIA, 5 U.S.C. 552(b)(4), because 
disclosure could reasonably be expected to cause substantial competitive 
harm.
    (2) Submitter means any person or entity who provides confidential 
commercial information to the Agency. The term ``submitter'' includes, 
but is not limited to, corporations, state governments and foreign 
governments.
    (b) Notice to submitters. Whenever the Agency receives a FOIA 
request for confidential commercial information and, pursuant to 
paragraph (c) of this section, the submitter of such information is 
entitled to receive notice of that request, then the Agency shall 
promptly notify the submitter that it has received the request, unless 
such a

[[Page 726]]

notice is not required pursuant to paragraph (g) of this section. The 
notice shall be in writing and shall either describe the exact nature of 
the confidential commercial information requested or provide a copy of 
the records or portion of the records containing the confidential 
commercial information. The notice shall be addressed to the submitter 
and mailed, postage prepaid, first class mail, to the submitter's last 
known address. Where notice is required to be given to a voluminous 
number of submitters, in lieu of such a mailing the notice may be posted 
or published in a manner and place reasonably calculated to provide 
notice to the submitters.
    (c) When notice is required; related matters. (1) For confidential 
commercial information submitted prior to January 1, 1988, the Agency 
shall provide a submitter with notice of its receipt of a FOIA request 
whenever:
    (i) The records are less than ten years old and the information has 
been designated by the submitter as confidential commercial information; 
or
    (ii) The Agency has reason to believe that the disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm to the submitter thereof.
    (2) For confidential commercial information submitted to the Agency 
on or after January 1, 1988, the Agency shall provide a submitter with 
notice of its receipt of a FOIA request whenever:
    (i) The submitter has designated the information as confidential 
commercial information pursuant to the requirements of this section; or
    (ii) The Agency has reason to believe that the disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm to the submitter.
    (3) Notice of a request for confidential commercial information 
falling within paragraph (c)(2)(i) of this section shall be required for 
a period of not more than ten years after the date of submission unless 
the submitter provides reasonable justification for a designation period 
of greater duration.
    (4) A submitter shall use good-faith efforts to designate by 
appropriate markings, either at the time a record is submitted to the 
Agency or within a reasonable period of time thereafter, those portions 
of the record which it deems to contain confidential commercial 
information. The designation shall be accompanied by a certification 
made by the submitter, its agent or designee that to the best of the 
submitter's knowledge, information and belief, the record does, in fact, 
contain confidential commercial information that theretofore has not 
been disclosed to the public.
    (5) Whenever the Agency provides notice to the submitter in 
accordance with paragraph (c) of this section, the Agency shall at the 
same time provide written notice to the requester that it is affording 
the submitter a reasonable period of time within which to object to the 
disclosure, and that, therefore, the Agency may be required to enlarge 
the time within which it otherwise would respond to the request.
    (d) Opportunity to object to disclosure. To the extent permitted by 
law, the notice required by paragraph (c) of this section shall afford a 
submitter a reasonable period of time within which the submitter or its 
authorized representative may provide the Agency with a written 
objection to the disclosure of the confidential commercial information 
and demonstrate why the submitter believes that the records contain 
confidential commercial information whose disclosure would, probably, 
cause substantial competitive injury to the submitter. Except where a 
certification already has been made in conformance with the requirements 
of paragraph (c)(4) of this section, the objection shall be accompanied 
by certification made by the submitter, its agent or designee, that to 
the best of the submitter's knowledge, information and belief, the 
record does, in fact, contain confidential commercial information that 
theretofore has not been disclosed to the public. Information provided 
by a submitter pursuant to this paragraph may itself be subject to 
disclosure under the FOIA.
    (e) Notice of intent to disclose. (1) The Agency shall give careful 
consideration to objections made by a submitter pursuant to paragraph 
(d) of this section prior to making any administrative determination of 
the issue. Whenever the

[[Page 727]]

Agency decides to disclose information despite the objection of a 
submitter, the Agency shall forward to the submitter a written notice 
which shall include:
    (i) A statement of the reasons for which a submitter's disclosure 
objections were not sustained; and
    (ii) A description of the information to be disclosed.
    (2) To the extent permitted by law, the notice required to be given 
by paragraph (e)(1) of this section shall be provided to the submitter a 
reasonable number of days prior to the specific disclosure date.
    (3) Whenever the Agency provides notice to the submitter in 
accordance with paragraphs (e) (1) and (2) of this section, the Agency 
shall at the same time notify the requester
    (i) That such a notice has been given and
    (ii) Of the proposed date for disclosure.
    (f) Notice of lawsuit. When a requester brings suit seeking to 
compel the disclosure of information for which notice is required 
pursuant to paragraph (c) of this section, the Agency shall promptly 
notify the submitter that such suit has been filed.
    (g) Exceptions to notice requirements. The notice requirements of 
this section shall not apply if:
    (1) The Agency determines that the information should not be 
disclosed;
    (2) The information has been published or has been officially made 
available to the public;
    (3) Disclosure of the information is required by an Agency rule 
that;
    (i) Was adopted pursuant to notice and public comment;
    (ii) Specifies narrow classes of records submitted to the Agency 
that are to be released under the FOIA; and
    (iii) Provides in exceptional circumstances for notice when the 
submitter provides written justification, at the time the information is 
submitted or a reasonable time thereafter, that disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm;
    (4) For purposes of paragraph (c) of this section, the information 
requested was not designated by the submitter as exempt from disclosure 
when the submitter had an opportunity to make such designation at the 
time of submission of the information or within a reasonable time 
thereafter, unless;
    (i) The Agency has substantial reason to believe that disclosure of 
the information would result in competitive harm; or
    (ii) The designation made by the submitter appears obviously 
frivolous; except that, in such case, the Agency must provide the 
submitter with written notice of any final administrative disclosure 
determination within a reasonable number of days prior to the specified 
disclosure date.



                  Subpart E--Exemptions From Disclosure



Sec. 212.41  Exemptions from publication and disclosure requirements of subparts B, C, and D.

    None of the provisions of subparts B, C, and D which provide for 
publication and disclosure of certain information and records shall be 
applicable to matters that are:
    (a) Specifically authorized under criteria established by an 
Executive Order to be kept secret in the interest of national defense or 
foreign policy and are in fact properly classified pursuant to such 
Executive Order;
    (b) Related solely to the internal personnel rules and practices of 
the Agency;
    (c) Specifically exempted from disclosure by statute;
    (d) Trade secrets and commercial or financial information obtained 
from a person and privileged and confidential;
    (e) Interagency or intra-agency memorandums or letters which would 
not be available by law to a party other than an agency in litigation 
with the agency;
    (f) Personnel and medical files and similar files the disclosure of 
which would constitute a clearly unwarranted invasion of personal 
privacy;
    (g) Records or information compiled for law enforcement purposes, 
but only to the extent that the production of such law enforcement 
records or information:
    (1) Would reasonably be expected to interfere with enforcement 
proceedings;

[[Page 728]]

    (2) Would deprive a person of a right to a fair trial or an 
impartial adjudication;
    (3) Could reasonably be expected to constitute an unwarranted 
invasion of personal privacy;
    (4) Could reasonably be expected to disclose the identity of a 
confidential source, including a State, local or foreign agency or 
authority or any private institution which furnished information on a 
confidential basis, and, in the case of a record or information compiled 
by a criminal law enforcement authority in the course of a criminal 
investigation, or by an agency conducting a lawful security intelligence 
investigation, information furnished by a confidential source;
    (5) Would disclose techniques and procedure for law enforcement 
investigations or prosecutions if such disclosure could reasonably be 
expected to risk circumvention of the law; or
    (6) Could reasonably be expected to endanger the life or physical 
safety of any individual.
    (h) Contained in or related to examination, operating, or condition 
reports prepared by, on behalf of, or for the use of any agency 
responsible for the regulation or supervision of financial institutions; 
and
    (i) Geological and geophysical information and data (including maps) 
concerning wells.



Sec. 212.42  Exemption from 5 U.S.C. 552.

    Whenever a request is made which involves access to records 
described in paragraph (g) of Sec. 212.41 and the investigation or 
proceedings involves a possible violation of criminal law; and there is 
reason to believe that the subject of the investigation or proceeding is 
not aware of its pendency, and disclosure of the existence of the 
records could reasonably be expected to interfere with enforcement 
proceedings, the Agency may, during only such time as that circumstances 
continues, treat the records as not subject to the requirements of 5 
U.S.C. 552 and this subpart.



     Subpart F--Opening of Records for Nonofficial Research Purposes



Sec. 212.51  General policy.

    (a) The Agency will open its records on an equitable basis to all 
individuals engaged in private research as soon as such action may be 
taken without adversely affecting the national security, the maintenance 
of friendly relations with other nations, the efficient operation of the 
Agency, or the administrative feasibility of servicing requests for 
access to such records.
    (b) Access for research purposes to the classified foreign policy 
records in the Agency's custody will be governed by the regulations of 
the Department of State with respect thereto, as set forth in part 6, 
chapter II of title II of the Code of Federal Regulations. Application 
for such access may be made to the Chief, Customer Outreach and 
Oversight Staff, at the address listed in Sec. 212.33(a) of this part. 
That officer, or his/her designee, in consultation with the Director, 
Historical Office, Department of State, or his/her designee, will 
determine the action to be taken and will so advise the researcher.



PART 213--COLLECTION OF CLAIMS--Table of Contents




                      Subpart A--General Provisions

Sec.
213.1  Purpose.
213.2  Scope.
213.3  Subdivision of claims.
213.4  Late payment, penalty and administrative charges.
213.5  Demand for payment.
213.6  Collection by offset.
213.7  Disclosure to consumer reporting agencies and contracts with 
          collection agencies.

                   Subpart B--Salary Offset Provisions

213.8  Scope.
213.9  Coordinating offset with another federal agency.
213.10  Determination of indebtedness.
213.11  Notice requirements before offset.
213.12  Request for a hearing.
213.13  Results if employee fails to meet deadlines.
213.14  Hearings.
213.15  Written decision following a hearing.

[[Page 729]]

213.16  Review of agency records related to the debt.
213.17  Written agreement to repay debt as alternative to salary offset.
213.18  Procedures for salary offset.
213.19  Non-waiver of rights.
213.20  Refunds.

           Subpart C--Collection of Debts by Tax Refund Offset

213.21  Purpose.
213.22  Applicability and scope.
213.23  Administrative charges.
213.24  Pre-offset notice.
213.25  Reasonable attempt to notify and clear and concise notification.
213.26  Consideration of evidence and notification of decision.
213.27  Change in conditions after submission to IRS.

    Authority:  Sec. 621 of the Foreign Assistance Act of 1961, as 
amended, 22 U.S.C. 2381; subpart B also issued under 5 U.S.C. 5514; 5 
CFR 550, subpart K. Subpart C also issued under 31 U.S.C. 3720A.



                      Subpart A--General Provisions

    Source:  50 FR 38521, Sept. 23, 1985, unless otherwise noted.



Sec. 213.1  Purpose.

    These regulations prescribe the procedures to be used by the Agency 
for International Development (``AID``) in the collection of claims owed 
to AID and to the United States.



Sec. 213.2  Scope.

    (a) Applicability of Federal Claims Collection Standards. Except as 
set forth in this part or otherwise provided by law, AID will conduct 
administrative actions to collect claims (including offset, compromise, 
suspension, termination, disclosure and referral) in accordance with the 
Federal Claim Collection Standards (``FCCS'') of the General Accounting 
Office and Department of Justice, 4 CFR parts 101-105.
    (b) This part is not applicable to:
    (1) Claims arising out of loans for which compromise and collection 
authority is conferred by section 635(g)(2) of the Foreign Assistance 
Act of 1961, as amended, 22 U.S.C. 2395(g)(2).
    (2) Claims arising from investment guaranty operations for which 
settlement and arbitration authority is conferred by section 635(i) of 
the Foreign Assistance Act of 1961, as amended, 22 U.S.C. 2395(i).
    (3) Claims against any foreign country or any political subdivision 
thereof, or any public international organization.
    (4) Claims where the A.I.D. Administrator or his designee determines 
that the achievement of the purposes of the Foreign Assistance Act of 
1961, as amended, 22 U.S.C. 2151 et seq., or any other provision of law 
administered by A.I.D. require a different course of action.



Sec. 213.3  Subdivision of claims.

    A debtor's liability arising from a particular contract or 
transaction (for example, each individual Supplier's Certificate and 
Agreement, Form AID 282) shall be considered a single claim for purposes 
of the monetary ceilings of the FCCS.



Sec. 213.4  Late payment, penalty and administrative charges.

    (a) Except as otherwise provided by statute, loan agreement or 
contract, A.I.D. will assess:
    (1) Late payment charges (interest) on unpaid claims at the higher 
of the Treasury tax and loan account rate or the prompt payment interest 
rate established under section 12 of the Contract Disputes Act of 1978.
    (2) Penalty charges at 6 percent a year on any portion of a claim 
that is delinquent for more than 90 days.
    (3) Administrative charges to cover the costs of processing and 
calculating delinquent claims.
    (b) Late payment charges shall be computed from the date of mailing 
or hand delivery of the notice of the claim and interest requirements.
    (c) Waiver. (1) Late payment charges are waived on any claim or any 
portion of a claim which is paid within 30 days after the date on which 
late payment charges begin to accrue.
    (2) The 30 day period may be extended on a case-by-case basis if it 
is determined that an extension is appropriate.
    (3) AID may waive late payment, penalty and administrative charges 
under the FCCS criteria for the compromise of claims (41 CFR part 103) 
or upon a determination that collection of the charges would be against 
equity and

[[Page 730]]

good conscience or not in the best interests of the United States, 
including for example:
    (i) Pending consideration of a request for reconsideration, 
administrative review or waiver under a permissive statute,
    (ii) If repayment of the full amount of the debt is made after the 
date upon which interest and other charges become payable and the 
estimated costs of recovering the residual balance exceed the amount 
owed, or
    (iii) If collection of interest or other charges would jeopardize 
collection of the principal of the claim.



Sec. 213.5  Demand for payment.

    (a) A total of three progressively stronger written demands at 
approximately 30-day intervals will normally be made, unless a response 
or other information indicates that additional written demands would 
either be unnecessary or futile. When necessary to protect the 
Government's interest, written demand may be preceded by other 
appropriate actions under the Federal Claims Collection Standards, 
including immediate referral for litigation and/or offset.
    (b) The initial written demand for payment (usually a Bill for 
Collection, Form AID 7-129) shall inform the debtor of:
    (1) The basis for the claim;
    (2) The amount of the claim;
    (3) The date when payment is due 30 days from date of mailing or 
hand delivery of the initial demand for payment;
    (4) The provision for late payment (interest), penalty and 
administrative charges, if payment is not received by the due date.



Sec. 213.6  Collection by offset.

    (a) Collection by administrative offset will be undertaken only on 
claims which are liquidated or certain in amount. Offset will be used 
whenever feasible and not otherwise prohibited. Offset is not required 
to be used in every instance and consideration should be given to the 
debtor's financial condition and the impact of offset on Agency programs 
or projects.
    (b) The procedures for offset in this section do not apply to the 
offset of Federal salaries under 5 U.S.C. 5514 or offset under section 
640A of the Foreign Assistance Act of 1961, as amended, 22 U.S.C. 2399.
    (c) Before offset is made, the agency will provide the debtor with 
written notice informing the debtor of:
    (1) The nature and amount of the claim;
    (2) The intent of the agency to collect by administrative offset, 
including asking the assistance of other Federal agencies to help in the 
offset whenever possible, if the debtor has not made payment by the 
payment due date or has not made an arrangement for payment by the 
payment due date;
    (3) The right of the debtor to inspect and copy the records of the 
agency related to the claim;
    (4) The right of the debtor to a review of the claim within the 
agency. If the claim is disputed in full or part, the debtor shall 
respond to the demand in writing by making a request to the billing 
office for a review of the claim within the agency by the payment due 
date stated in the notice. The debtor's written response shall state the 
basis for the dispute. If only part of the claim is disputed, the 
undisputed portion must be paid by the date stated in the notice to 
avoid late payment, penalty and administrative charges. If A.I.D. either 
sustains or amends its determination, it shall notify the debtor of its 
intent to collect the claim, with any adjustments based on the debtor's 
response by administrative offset unless payment is received within 30 
days of the mailing of the notification of its decision following a 
review of the claim.
    (5) The right of the debtor to offer to make a written agreement to 
repay the amount of the claim.
    (6) The notice of offset need not include the requirements of 
paragraph (c) (3), (4) or (5) of this section if the debtor has been 
informed of the requirements at an earlier stage in the administrative 
proceedings, e.g., if they were included in a final contracting 
officer's decision.
    (d) A.I.D. will promptly make requests for offset to other agencies 
known to be holding funds payable to a debtor and, when appropriate, 
place the

[[Page 731]]

name of the debtor on the ``List of Contractors Indebted to the United 
States.'' A.I.D. will provide instructions for the transfer of funds.
    (e) A.I.D. will promptly process requests for offset from other 
agencies and transfer funds to the requesting agency upon receipt of the 
written certification required by Sec. 102.3 of the FCCS.
[50 FR 38521, Sept. 23, 1985, as amended at 51 FR 26544, July 24, 1986]



Sec. 213.7  Disclosure to consumer reporting agencies and contracts with collection agencies.

    (a) A.I.D. may disclose delinquent debts, other than delinquent 
debts of current Federal employees, to consumer reporting agencies in 
accordance with 31 U.S.C. 3711(f) and the FCCS.
    (b) A.I.D. may enter into contracts with collection agencies in 
accordance with 31 U.S.C. 3718 and the FCCS.



                   Subpart B--Salary Offset Provisions

    Source:  51 FR 26544, July 24, 1986, unless otherwise noted.



Sec. 213.8  Scope.

    (a) This subpart sets forth AID's procedures for the collection of a 
Federal employee's pay by salary offset to satisfy certain valid and 
past due debts owed the United States Government.
    (b) This subpart applies to:
    (1) Current employees of AID and other agencies who owe debts to 
AID.
    (2) Current employees of AID who owe debts to other agencies.
    (c) This subpart does not apply to debts or claims arising under the 
Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.); the Social Security 
Act (42 U.S.C. 301 et seq.); the tariff laws of the United States; or to 
any case where collection of a debt by salary offset is explicitly 
provided for or prohibited by another statute (e.g. travel advances in 5 
U.S.C. 5705 and employee training expenses 5 U.S.C. 4108).
    (d) This subpart does not apply to any adjustment to pay arising out 
of an employee's election of coverage or a change in coverage under a 
Federal benefits program requiring periodic deductions from pay or 
ministerial adjustments in pay, if the amount to be recovered was 
accumulated over four pay periods or less.
    (e) These regulations do not preclude an employee from:
    (1) Requesting waiver of erroneous payment of salary, travel, 
transportation and relocation expenses and allowances;
    (2) Requesting waiver of any other type of debt, if waiver is 
available by statute; or
    (3) Questioning the amount of validity of a debt by submitting a 
subsequent claim to the General Accounting Office.
    (f) Nothing in these regulations precludes the compromise, 
suspension or termination of collection actions where appropriate under 
subpart A or other regulations.



Sec. 213.9  Coordinating offset with another federal agency.

    (a) When AID is owed the debt. When AID is owed a debt by an 
employee of another agency, the other agency shall not initiate the 
requested offset until AID provides the agency with a written 
certification that the debtor owes AID a debt (including the amount and 
basis of the debt and the due date of payment) and that AID has complied 
with these regulations.
    (b) When another agency is owed the debt. AID may use salary offset 
against one of its employees who is indebted to another agency, if 
requested to do so by that agency. Such a request must be accompanied by 
a certification by the requesting agency that the person owes the debt 
(including the amount and basis of the debt and the due date of payment) 
and that the agency has complied with its regulations required by 5 
U.S.C. 5514 and 5 CFR part 550, subpart K.



Sec. 213.10  Determination of indebtedness.

    (a) In determining that an employee is indebted to AID and that 4 
CFR parts 101 through 105 have been satisfied and that salary offset is 
appropriate, AID will review the debt to make sure that it is valid and 
past due.
    (b) If AID determines that any of the requirements of paragraph (a) 
of this section have not been met, no determination of indebtedness 
shall be made

[[Page 732]]

and salary offset will not proceed until AID is assured that the 
requirements have been met.



Sec. 213.11  Notice requirements before offset.

    Except as provided in Sec. 213.8, salary offset will not be made 
unless AID first provides the employee with a minimum of 30 calendar 
days written notice. This Notice of Intent to Offset Salary (``Notice of 
Intent'') will state:
    (a) That AID has reviewed the records relating to the debt and has 
determined that a debt is owed, the amount of the debt, and the facts 
giving rise to the debt;
    (b) AID's intention to collect the debt by salary offset, i.e. by 
means of deduction from the employee's current disposable pay until the 
debt and all accumulated interest are paid in full;
    (c) The amount, frequency, approximate beginning date, and duration 
of the salary intent;
    (d) An explanation of that late payment, penalties and 
administrative costs will be charged in accordance with Sec. 213.4, 
unless excused in accordance with Sec. 213.4(c);
    (e) The employee's right to inspect and copy agency records relating 
to the debt;
    (f) The employee's right to enter into a written agreement with AID 
for a repayment schedule differing from that proposed by AID, so long as 
the terms of the repayment schedule proposed by the employee are 
agreeable to AID;
    (g) The right to a hearing conducted by a hearing official on AID's 
determination of the debt, the amount of the debt, or percentage of 
disposable pay to be deducted each pay period, so long as a request for 
a hearing filed by the employee as prescribed by Sec. 213.12;
    (h) That the timely filing of a request for hearing will stay the 
collection proceedings;
    (i) That a final decision on the hearing will be issued at the 
earliest practical date, but not later than 60 calendar days after the 
filing of the request for a hearing, unless the employee requests, and 
the hearing officer grants, a delay in the proceedings;
    (j) That any knowingly false or frivolous statements, 
representations, or evidence may subject the employee to:
    (1) Disciplinary procedures appropriate under 5 U.S.C. chapter 75, 5 
CFR part 752, or any other applicable statutes or regulations;
    (2) Penalties under the False Claims Act, 31 U.S.C. 3729-3731, or 
any other applicable statutory authority; or
    (3) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002 or 
any other applicable statutory authority;
    (k) Any other rights and remedies available to the employee under 
statutes or regulations governing the program for which the collection 
is being made;
    (l) That amounts paid on or deducted for the debt which are later 
waived or found not owed to the United States will be promptly refunded 
to the employee, unless there are applicable contractual or statutory 
provisions to the contrary;
    (m) The method and time period for requesting a hearing; and
    (n) The name and address of an AID official to whom communications 
should be directed.



Sec. 213.12  Request for a hearing.

    (a) Except as provided in paragraph (c) of this section, an employee 
must file a request for a hearing, that is received by AID not later 
than 30 calendar days from the date of AID's notice described in 
Sec. 213.11 if an employee wants a hearing concerning:
    (1) The existenceor amount of the debt; or
    (2) AID's proposed offset schedule (including percentage).
    (b) The request must be signed by the employee and should identify 
and explain with reasonable specificity and brevity the facts, evidence 
and witnesses which the employee believes support his or her position. 
If the employee objects to the percentage of disposable pay to be 
deducted from each check, the request should state the objection and the 
reasons for it.
    (c) If the employee files a request for hearing later than the 30 
calendar days as described in paragraph (a) of this section, the hearing 
officer may accept the request if the employee can show that the delay 
was because of circumstances beyond his or her control or because of 
failure to receive notice

[[Page 733]]

of the filing deadline (unless the employee has actual notice of the 
filing deadline).



Sec. 213.13  Result if employee fails to meet deadlines.

    An employee waives the right to a hearing and will have his or her 
disposable pay offset in accordance with offset schedule set forth in 
the Notice of Intent if the employee:
    (a) Fails to file a petition for a hearing as prescribed in 
Sec. 213.12; or
    (b) Is scheduled to appear and fails to appear at the hearing.



Sec. 213.14  Hearings.

    (a) If an employee timely files a request for a hearing under 
Sec. 213.12 AID shall select the time, date, and location for the 
hearing.
    (b)(1) Hearings shall be conducted by an appropriately designated 
hearing official; and
    (2) Rules of evidence shall not be adhered to, but the hearing 
official shall consider all evidence that he or she determines to be 
relevant to the debt that is the subject of the hearing and weigh it 
accordingly, given all of the facts and circumstances surrounding the 
debt.
    (c) AID will have the burden of going forward to prove the existence 
of the debt.
    (d) The employee requesting the hearing shall bear the ultimate 
burden of proof.
    (e) The evidence presented by the employee must prove that no debt 
exists or cast sufficient doubt such that reasonable minds could differ 
as to the existence of the debt.



Sec. 213.15  Written decision following a hearing.

    Written decisions provided after a hearing will include:
    (a) A statement of the facts presented to support the nature and 
origin of the alleged debt and those presented to refute the debt;
    (b) The hearing officer's analysis, findings and conclusions, 
considering all of the evidence presented and the respective burdens of 
the parties, in light of the hearing;
    (c) The amount and validity of the alleged debt determined as a 
result of the hearing; and
    (d) The amount, frequency, beginning date and duration of the salary 
offset, if applicable.



Sec. 213.16  Review of agency records related to the debt.

    (a) Notification by employee. An employee who intends to inspect or 
copy agency records related to the debt must send a letter to the 
official designated in Sec. 213.11(n) stating his or her intention. The 
letter must be received by AID within 30 calendar days of the date of 
the Notice of Intent.
    (b) AID's response. In response to the timely notice submitted by 
the debtor as described in paragraph (a) of this section, AID will 
notify the employee of the location and time when the employee may 
inspect and copy AID records related to the debt.



Sec. 213.17  Written agreement to repay debt as alternative to salary offset.

    (a) Notification by employee. The employee may propose, in response 
to a Notice of Intent, a written agreement to repay the debt as an 
alternative to salary offset. Any employee who wishes to do this must 
submit a proposed written agreement to repay the debt which is received 
by AID with 30 calendar days of the date of the Notice of Intent.
    (b) AID's response. AID will notify the employee whether the 
employee's proposed written agreement for repayment is acceptable. AID 
may accept a repayment agreement instead of proceeding by offset. In 
making this determination, AID will balance AID's interest in collecting 
the debt against hardship to the employee. If the debt is delinquent and 
the employee has not disputed its existence or amount, AID will accept a 
repayment agreement, instead of offset, for good cause such as, if the 
employee is able to establish that offset would result in undue 
financial hardship or would be against equity and good conscience.
    (c) Procedures. If the employee and AID enter into a written 
agreement to repay instead of salary offset, the debt will be repaid in 
accordance with the provisions of the agreement and the procedures of 
Sec. 213.18 will not apply.

[[Page 734]]



Sec. 213.18  Procedures for salary offset.

    Unless AID agrees otherwise, the procedures for salary offset are as 
follows:
    (a) Method. Salary offset will be made by deduction at one or more 
officially established pay intervals from the current pay account of the 
employee without his or her consent.
    (b) Source. The source of salary offset is current disposable pay 
which is that part of current basic pay, special pay, retainer pay, or 
in the case of an employee not entitled to pay, other authorized pay 
remaining after the deduction of any amount required by law to be 
withheld.
    (c) Types. Ordinarily debts will be collected by salary offset in 
one lump sum if possible. However, if the employee is financially unable 
to pay in one lump sum or the amount of the debt exceeds 15 percent of 
disposal pay for an officially established pay interval, the collection 
by salary offset must be made in installment deductions.
    (d) Amount and duration of installment deductions. (1) The size of 
installment deductions must bear a reasonable relation to the size of 
the debt and the employee's ability to pay. If possible the size of the 
deduction will be that necessary to liquidate the debt in no more than 1 
year. However, the amount deducted for any period must not exceed 15 
percent of the disposal pay from which the deduction is made, unless the 
employee has agreed to a greater amount.
    (2) Installment payments of less than $25 per pay period will be 
accepted only in the most unusual circumstances.
    (3) Installment deductions will be made over a period of not greater 
than the anticipated period of employment.
    (e) When deductions may begin. (1) Salary offset will begin as of 
the date stated in the Notice of Intent, unless a hearing has been 
requested.
    (2) If there has been a timely request for a hearing, salary offset 
will begin as of the date stated in the written decision provided after 
the hearing.
    (f) Additional offset provisions--(1) Liquidation from final check. 
If employment ends before salary offset is completed, the remaining debt 
will be liquidated by offset from subsequent payments of any nature due 
the employee from AID as of the date of separation (e.g. final salary 
payment, lump-sum leave, etc).
    (2) Offset from other payments. If the debt cannot be liquidated by 
offset from any final check, the remaining debt will be liquidated by 
offset from later payments of any kind due the former employee from the 
United States.



Sec. 213.19  Non-waiver of rights.

    So long as there are no statutory or contractual provisions to the 
contrary, no employee payment (of all or portion of a debt) collected 
under this subpart will be interpreted as a waiver of any rights that 
the employee may have under 5 U.S.C. 5514.



Sec. 213.20  Refunds.

    (a) AID will refund promptly to the appropriate individual amounts 
offset under these regulations when:
    (1) A debt is waived or otherwise found not owing the United States 
(unless expressly prohibited by statute or regulation); or
    (2) AID is directed by an administrative or judicial order to make a 
refund.
    (b) Refunds do not bear interest unless required or permitted by law 
or contract.



           Subpart C--Collection of Debts by Tax Refund Offset

    Source:  60 FR 40456, Aug. 9, 1995, unless otherwise noted.



Sec. 213.21  Purpose.

    This subpart establishes procedures for AID to refer past due debts 
to the Internal Revenue Service (IRS) for offset against income tax 
refunds of taxpayers owing debts to AID.



Sec. 213.22  Applicability and scope.

    (a) This subpart implements 31 U.S.C. 3720A which authorizes the IRS 
to reduce a tax refund by the amount of a past due and legally 
enforceable debt owed to the United States.
    (b) A past due legally enforceable debt referable to the IRS is a 
debt which is owed to the United States and:
    (1) Except for judgement debt or other debts specifically exempt 
from

[[Page 735]]

this requirement, is referred within 10 years after AID's right of 
action accrues;
    (2) In the case of individuals, is at least $25.00;
    (3) In the case of business debtors is at least $100.00;
    (4) In the case of individual debtors, cannot be currently collected 
pursuant to the salary offset provisions of 5 U.S.C. 5514(a);
    (5) Is ineligible for or cannot be currently collected pursuant to 
the administrative offset provisions of 31 U.S.C. 3716;
    (6) Is the debt of a debtor (or in the case of an individual debtor, 
his or her spouse) for whom AID records do not show debtor has filed for 
bankruptcy under title 11 of the United States Code or for whom AID can 
clearly establish at the time of the referral that an automatic stay 
under 11 U.S.C. 362 has been lifted or is no longer in effect;
    (7) Has been disclosed by AID to a consumer reporting agency as 
authorized by 31 U.S.C. 3711(f); and
    (8) For which AID has given notice, considered any evidence, and 
determined that the debt is past-due and legally enforceable under the 
provisions of this subpart.



Sec. 213.23  Administrative charges.

    All administrative charges incurred in connection with the referral 
of debts to the IRS will be added to the debt, thus increasing the 
amount of the offset.



Sec. 213.24  Pre-offset notice.

    (a) Before AID refers a debt to the IRS, it will notify or make a 
reasonable attempt to notify the debtor that:
    (1) The debt is past due;
    (2) Unless repaid within 60 calendar days thereafter, the debt will 
be referred to the IRS for offset against any overpayment of tax;
    (3) The debtor has at least 60 days from the date of the notice to 
present evidence that all or part of such debt is not past-due or not 
legally enforceable; and
    (4) AID will consider any evidence presented by the debtor and 
determine whether any part of such debt is past-due and legally 
enforceable.
    (b) The notice will explain to the debtor the manner in which the 
debtor may present such evidence to AID.



Sec. 213.25  Reasonable attempt to notify and clear and concise notification.

    (a) Reasonable attempt to notify. AID will have made a reasonable 
attempt to notify the debtor under Sec. 213.24(a) it is used a mailing 
address for the debtor obtained from the IRS pursuant to the Internal 
Revenue Code, 26 U.S.C. 6103 (m)(2) or (m)(4), unless AID receives clear 
and concise notification from the debtor that notices are to be sent to 
an address different from the address obtained from the IRS.
    (b) Clear and concise notification. Clear and concise notification 
means that the debtor has provided AID with written notification 
containing the debtor's name and identifying number (as defined in the 
Internal Revenue Code, 26 U.S.C. 6109), the debtor's new address, and 
the debtor's intent to have the notices sent to the new address.



Sec. 213.26  Consideration of evidence and notification of decision.

    (a) AID will give the debtor at least 60 days from the date of the 
pre-offset notice to present evidence. Evidence that collection of the 
debt is affected by a bankruptcy proceeding involving the debtor shall 
bar referral of the debt.
    (b) If the evidence presented is not considered by an employee of 
AID but by an entity or person acting for AID, the debtor will have at 
least 30 days from the date the entity or person notifies the debtor 
that all or part of the debt is past-due and legally enforceable to 
request review by an employee of AID of any unresolved dispute.
    (c) AID will provide the debtor with its decision and the decision 
of any entity or person acting for AID on to whether all or part of the 
debt is past-due and legally enforceable. The decision will include a 
statement of the basis or principal bases for the decision.



Sec. 213.27  Change in conditions after submission to IRS.

    AID will promptly notify the IRS if, after submission of a debt to 
the IRS for offset, AID:

[[Page 736]]

    (a) Determines that an error has been made with respect to the 
information submitted to the IRS;
    (b) Receives a payment or credits a payment, other than an IRS 
offset, to the account of the debtor;
    (c) Receives notice that the debtor has filed for bankruptcy under 
title 11 of the United States Code or the debt has been discharged in 
bankruptcy;
    (d) Receives notice that an offset was made at the time when the 
automatic stay provisions of 11 U.S.C. 362 were in effect;
    (e) Receives notice that the debt has been extinguished by death; or
    (f) Refunds all or part of the offset amount to the debtor.



PART 214--ADVISORY COMMITTEE MANAGEMENT--Table of Contents




                           Subpart A--General

Sec.
214.1  Purpose.
214.2  Definition of advisory committee.
214.3  A.I.D. Advisory Committee Management Officer.

             Subpart B--Establishment of Advisory Committees

214.11  Establishment and chartering requirements.
214.12  Considerations in membership selection.
214.13  Responsibilities within A.I.D.
214.14  Charter revision.
214.15  Changes in membership.

        Subpart C--Termination and Renewal of Advisory Committees

214.21  Termination and renewal provisions.
214.22  Responsibilities within A.I.D.

               Subpart D--Operation of Advisory Committees

214.31  A.I.D. Advisory Committee Representative.
214.32  Calling of advisory committee meetings.
214.33  Notice of meetings.
214.34  Public participation.
214.35  Minutes of meetings.
214.36  Records of advisory committees.
214.37  Public access to committee records.
214.38  Submission of reports to the Library of Congress.

            Subpart E--Administration of Advisory Committees

214.41  Support services.
214.42  Uniform pay guidelines.
214.43  Agency records.
214.44  Annual review and reports.

                   Subpart F--Administrative Remedies

214.51  Administrative review of denial for public access to records.
214.52  Administrative review of other alleged non-compliance.

    Authority:  Section 621, Foreign Assistance Act of 1961, as amended 
(22 U.S.C. 2381); sec. 8(a), Federal Advisory Committee Act, Pub. L. 92-
463; and Executive Order 11769.

    Source:  40 FR 33205, Aug. 7, 1975, unless otherwise noted.



                           Subpart A--General



Sec. 214.1  Purpose.

    The regulations in this part prescribe administrative guidelines and 
management controls for A.I.D. advisory committees. Federal Advisory 
Committees are governed by the provisions of the Federal Advisory 
Committee Act, Pub. L. 92-463 (effective January 5, l973, hereinafter 
referred to as the Act); Executive Order No. 11769 (February 21, 1974) 
entitled ``Committee Management;'' OMB Circular A-63 (March 27, 1974, as 
amended).



Sec. 214.2  Definition of advisory committee.

    (a) The term advisory committee is defined in section 3(2) of the 
Act.
    (b) In general, this definition includes any committee, board, 
commission, council, conference, panel, task force, or other similar 
group, or any subcommittee or sub-group thereof, which is formed or 
utilized by the Agency for obtaining advice or recommendations, and 
which is not composed wholly of full-time Federal employees.



Sec. 214.3  A.I.D. Advisory Committee Management Officer.

    The Advisory Committee Management Officer is responsible to the 
Administrator for the establishment of uniform administrative guidelines 
and management controls which must be

[[Page 737]]

consistent with directives of the Director of the OMB under sections 7 
and 10 of the Act.



             Subpart B--Establishment of Advisory Committees



Sec. 214.11  Establishment and chartering requirements.

    Provisions governing the establishment and chartering of Advisory 
Committees are contained in section 9 of the Act and paragraph 6 of OMB 
Circular A-63. In summary, these requirements include the following:
    (a) Where establishment of an Advisory Committee is not specifically 
authorized by statute or by the President, the need for a new A.I.D. 
advisory committee is determined by the A.I.D. Administrator, in 
accordance with the guidelines set forth in section 5(b) of the Act. The 
determination also includes a certification that creation of the 
Committee is in the public interest and a description of the nature and 
purpose of the Committee.
    (b) After written consultation to the OMB Secretariat and 
notification that the establishment of the Committee would be in accord 
with the Act, A.I.D. publishes the Administrator's Determination in the 
Federal Register at least fifteen (15) days prior to the filing of the 
Committee's Charter.
    (c) Each advisory committee established or used by A.I.D. is 
required to file a charter with the A.I.D. Administrator, the House 
International Relations Committee, and the Senate Foreign Relations 
Committee, before meeting or taking any action.
    (d) Advisory committee charters shall include the following 
information:
    (1) Committee's official title;
    (2) Committee's objectives and scope of activity;
    (3) Period of time necessary for the committee to carry out its 
purposes;
    (4) Agency official to whom the committee reports;
    (5) Agency responsible for providing necessary support for the 
committee;
    (6) Description of duties for which the committee is responsible, 
and, if such duties are not solely advisory, a specification of the 
authority for such functions;
    (7) Estimated annual operating costs in dollars and man-years for 
the committee;
    (8) Estimated number and frequency of committee meetings;
    (9) Committee's termination date; and
    (10) Date the charter is filed.
    (e) A copy of the charter is required to be sent to the Library of 
Congress, Exchange and Gift Division, Federal Advisory Committee Desk, 
Washington, DC 20540.
[40 FR 33205, Aug. 7, 1975, as amended at 40 FR 54777, Nov. 26, 1975]



Sec. 214.12  Considerations in membership selection.

    Membership is to be fairly balanced in terms of points of view 
represented and functions to be performed. Appropriate attention is also 
given to factors of sex, race, creed, national origin, and religion.



Sec. 214.13  Responsibilities within A.I.D.

    (a) The A.I.D. Office or Bureau seeking establishment of a new 
A.I.D. advisory committee:
    (1) Justifies the need for the advisory committee to the 
satisfaction of the A.I.D. Advisory Committee Management Officer, the 
A.I.D. Administrator, and the OMB Secretariat.
    (2) Prepares, clears with the Advisory Committee Management Officer 
and the General Counsel, and submits to the Administrator all 
documentation necessary to establish or use the advisory committee.
    (b) The Advisory Committee Management Officer with assistance as 
appropriate from the General Counsel and the Office of Legislative 
Affairs:
    (1) Appraises the need for the proposed advisory committee;
    (2) Assures that the requirements of the Act and OMB guidelines have 
been followed;
    (3) If satisfied with paragraphs (b) (1) and (2) of this section, 
clears the proposal for submission to the Administrator and obtains OMB 
concurrence in Agency actions to establish advisory committees;
    (4) Maintains the agency file of approved charters and formal 
determinations;

[[Page 738]]

    (5) Publishes approved charters in the Agency's internal directives 
system;
    (6) Reviews proposed committee membership for compliance with legal 
requirements, including conflict of interest;
    (7) Assures publication of the Administrator's formal determinations 
in the Federal Register; and
    (8) Transmits approved advisory committee charters to the House 
International Relations Committee, the Senate Foreign Relations 
Committee, and the Library of Congress.
[40 FR 33205, Aug. 7, 1975, as amended at 40 FR 54778, Nov. 26, 1975]



Sec. 214.14  Charter revision.

    (a) Sponsoring A.I.D. Bureaus and Offices initiate revisions to 
advisory committee charters, as necessary, to reflect current 
information regarding scope, duties, etc.
    (b) Charter revision requires clearances by the advisory committee, 
the A.I.D. Advisory Committee Management Officer and the General 
Counsel; consultation with OMB; approval by the A.I.D. Administrator, 
and notification of the change to the Federal Register, Congressional 
committees, and the Library of Congress.



Sec. 214.15  Changes in membership.

    Changes in membership of advisory committees are proposed by the 
Bureau of Office through which the committee reports, are cleared by the 
Advisory Committee Management Officer and the Office of the General 
Counsel, and are approved by the A.I.D. Administrator.



        Subpart C--Termination and Renewal of Advisory Committees



Sec. 214.21  Termination and renewal provisions.

    Provisions governing the termination and renewal of advisory 
committees are contained in section 14 of the Act and paragraph 7 of OMB 
Circular A-63, as amended. As related to A.I.D.-established non-
statutory committees, these provisions mean that:
    (a) Each such committee which was in existence on January 5, 1973, 
shall terminate by January 5, 1975, unless it is renewed by the A.I.D. 
Administrator prior to the latter date.
    (b) Each such committee established after January 5, 1973, shall 
terminate not later than two years after its establishment, unless it is 
renewed by the A.I.D. Administrator prior to its termination date.
    (c) Any committee which is renewed shall continue for not more than 
two years unless, prior to the expiration of that period, it is renewed.
    (d) Renewal requires advance approval of the Administrator in 
accordance with section 5(c) which requires application of the criteria 
set forth in section 5(b) of the Act; notification to the OMB 
Secretariat not more than sixty (60) days nor less than thirty (30) days 
before the expiration date, and concurrence by the Secretariat; 
publication of a notice of the renewal; and the filing of a new advisory 
committee charter with the appropriate House and Senate Committees and 
to the Library of Congress.
    (e) Notification to the OMB Secretariat shall include:
    (1) The A.I.D. Administrator's determination that renewal is 
necessary and is in the public interest;
    (2) The reasons for his determination;
    (3) The Agency's plan to attain or maintain balanced membership of 
the committee; and
    (4) An explanation of why the committee's functions cannot be 
performed by the Agency or by an existing advisory committee.



Sec. 214.22  Responsibilities within A.I.D.

    Responsibilities within A.I.D. for the renewal of advisory 
committees are as follows:
    (a) The Office or Bureau through which the advisory committee 
reports: prepares, clears with the Advisory Committee Management Officer 
and the General Counsel, and submits to the Administrator all 
documentation necessary for committee renewal sixty-five (65) days prior 
to the expiration date of the Committee.
    (b) The Office of General Counsel assists in the preparation of 
charters; reviews and clears the proposal for conformity with the Act 
and other requirements; and assures publication of

[[Page 739]]

the Administrator's determination of renewal in the Federal Register.
    (c) The Office of Legislative Affairs transmits approved advisory 
committee charters to the House and Senate Committees and to the Library 
of Congress.



               Subpart D--Operation of Advisory Committees



Sec. 214.31  A.I.D. Advisory Committee Representative.

    (a) For each advisory committee used by A.I.D., the Administrator 
designates an A.I.D., employee to serve as the A.I.D. Advisory Committee 
Representative.
    (b) The designated A.I.D. employee performs functions required by 
section 10 of the Act and assigned herein. Such functions include:
    (1) Calling, or giving advance approval to, advisory committee 
meetings;
    (2) Approving an agenda for each meeting;
    (3) Making recommendations on proposals to close meetings, or parts 
of meetings, to the public; and clearing such recommendation with the 
Advisory Committee Management Officer and the General Counsel for 
decisions by the Administrator;
    (4) Assuring that advance notices of each meeting (whether open or 
closed) are published in the Federal Register, provided through other 
means such as press releases and direct mail, and provided to the 
Advisory Committee Management Officer.
    (5) Assuring that open meetings are accessible to the public;
    (6) As specified by the Administrator, chairing or attending each 
meeting;
    (7) Determining the number of committee members necessary to be 
present at any meeting for the transaction of committee business;
    (8) Adjourning any meeting, whenever he determines adjournment to be 
in the public interest;
    (9) Assuring that minutes are kept of each advisory committee 
meeting and of the meetings of sub-committees and sub-groups, and that 
such minutes are certified for accuracy by the chairman or presiding 
officer of the committee; and
    (10) Assuring that, subject to section 552 of title 5 United States 
Code, the documents of the advisory committee are made available for 
public inspection and copying.
    (11) Maintaining a current list of members of the advisory 
committee, and furnishing membership information to the A.I.D. Advisory 
Committee Management Officer on request.



Sec. 214.32  Calling of advisory committee meetings.

    (a) No advisory committee is to hold any meetings except at the 
call, or with the advance approval, of the designated A.I.D. Advisory 
Committee Representative.
    (b) Each advisory committee meeting is conducted in accordance with 
an agenda approved by the designated A.I.D. Advisory Committee 
Representative.
    (1) The agenda lists the matters to be considered at the meeting and 
indicates whether any portion of the meeting is to be closed to the 
public in accordance with subsection (c) of section 552(b) of title 5, 
United States Code.
    (2) Copies of the agenda are distributed to members of the committee 
prior to the date of the meeting and are included in the official 
records of the Advisory Committee.
[40 FR 33205, Aug. 7, 1975, as amended at 42 FR 26975, May 26, 1977]



Sec. 214.33  Notice of meetings.

    (a) Notice of each advisory committee meeting (whether the meeting 
is open or closed) shall be published in the Federal Register at least 
fifteen (15) days before the date of the meeting, and should also be 
provided through other means such as newspaper advertisements, press 
releases, and direct mail.
    (1) Exceptions to the requirement for public notice are granted only 
for reasons of national security as determined by the Director, OMB and 
are requested and justified by the Administrator, A.I.D. at least thirty 
(30) days prior to the meeting.
    (2) Exceptions to the fifteen (15) day advance publication 
requirement are granted in emergency situations as determined by the 
Administrator, A.I.D. In such situations, the facts on which

[[Page 740]]

exception is based are to be included in the Notice of the meeting.
    (3) Requests for exceptions under paragraphs (a) (1) and (2) of this 
section are prepared by the Advisory Committee Representative and are 
cleared by the Advisory Committee Management Officer and the General 
Counsel prior to submission to the Administrator.
    (b) Notices include the name of the advisory committee; the time of 
the meeting; the purposes of the meeting; a statement regarding the 
extent to which the public will be permitted to attend and, if any 
portion is closed, why such closure or partial closure is necessary, 
including citation of the appropriate exemption permitted under 
subsection (c) of 5 U.S.C. 552b. Thus, A.I.D. Notices of Advisory 
Committee meetings normally state that the meeting is open to the public 
and include the place of the meeting; and instructions for gaining 
access to open meetings which are held in a ``secured'' building.
    (c) Both formal and informal notices are prepared by the A.I.D. 
Advisory Committee Representative; formal notices to be published in the 
Federal Register are cleared with the Advisory Committee Management 
Officer and are sent to the Office of the General Counsel at least 
thirty-two (32) days before the scheduled meeting date.
    (d) Copies of all public notices are provided to the Advisory 
Committee Management Officer.
[40 FR 33205, Aug. 7, 1975, as amended at 40 FR 54778, Nov. 26, 1975; 42 
FR 26975, May 26, 1977]



Sec. 214.34  Public participation.

    (a) Each advisory committee meeting is to be open to the public 
except where:
    (1) The Director, OMB, has determined that public notice of a 
meeting would be inconsistent with national security; or
    (2) The Administrator, AID, has formally determined that a meeting, 
or portion of a meeting may be closed to the public in accordance with 
subsection (c) of section 552b of title 5, United States Code.
    (b) Advisory committee requests to close all or part of a meeting or 
a series of meetings are to include the reasons for proposed closure, 
citing specific exceptions involved under subsection (c) of section 552b 
of Title 5, United States Code. Such requests are submitted by the AID 
Advisory Committee Representative, through the Advisory Committee 
Management Officer and the General Counsel to the Administrator at least 
forty (40) days before the scheduled date of the meeting.
    (c) The Administrator's determination is to be in writing and is to 
contain a brief statement of the reasons for closing the meeting (or 
portion thereof). The determination itself is to be made available to 
the public on request.
    (d) When all or part of an advisory committee meeting is closed and 
detailed minutes are not to be made available in their entirety to the 
public, the Committee shall prepare and make available to the public 
within thirty (30) days of the close of the meeting a summary of its 
activities and related matters which are informative to the public 
consistent with the policy of 5 U.S.C. 552(b). Notice of availability of 
such a summary shall be incorporated in the notice of the meeting 
published in the Federal Register.
    (e) To facilitate public participation in advisory committee 
meetings which are to be open or partially open to the public:
    (1) Meetings are to be held at a reasonable time and at a place that 
is accessible to members of the public.
    (2) The size of the meeting room is to be large enough to 
accommodate the Advisory Committee, its staff, and those members of the 
public who might be expected to attend.
    (3) Any member of the public is permitted to file a written 
statement with the committee, before or after the meeting.
    (4) Interested persons may be permitted to present oral statements 
at the meeting in accordance with procedures established by the 
committee, and to the extent time available for the meeting permits.
    (5) Other participation by members of the public is not permitted, 
except in

[[Page 741]]

accordance with procedures established by the committee.
[40 FR 33205, Aug. 7, 1975, as amended at 42 FR 26975, May 26, 1977]



Sec. 214.35  Minutes of meetings.

    (a) Minutes are to be kept of each meeting of each advisory 
committee and its formal and informal sub-groups.
    (b) The chairman or presiding officer designates a member or other 
person to keep the minutes.
    (c) The minutes are to include:
    (1) The time and place of the meeting;
    (2) A list of members, staff, and A.I.D. employees attending;
    (3) A complete summary of matters discussed and conclusions reached;
    (4) Copies of all reports received, issued, or approved;
    (5) The extent to which the meeting was open to the public; and
    (6) The extent of public participation, including a list of those 
who presented oral or written statements and a estimate of the number of 
those who attended the meeting.
    (d) The chairman or presiding officer of the advisory committee is 
to certify to the accuracy of the minutes. The certification is to 
indicate that ``the minutes are an accurate and complete summary of the 
matters discussed and conclusions reached at the meeting held on 
(date(s)).''



Sec. 214.36  Records of advisory committees.

    (a) The A.I.D. Advisory Committee Representative is to maintain the 
records of the advisory committee in a location known to the A.I.D. 
Advisory Committee Management Officer.
    (b) Such records are to include the reports, transcripts, minutes, 
appendices, working papers, drafts, studies, agenda, and other documents 
which were made available to, or prepared for or by, the advisory 
committee.
    (c) Advisory committee records are maintained and disposed of 
according to procedures prescribed in the Agency's Handbook 21--
Communications, Part III, Records Filing and Disposition Manual.



Sec. 214.37  Public access to committee records.

    Records maintained in accordance with Sec. 214.36 are subject to the 
Freedom of Information Act, 5 U.S.C. 552 et seq. and, thus, are 
available for public inspection and copying pursuant to A.I.D. 
Regulation 12--Public Information (22 CFR part 212), subject to the 
general oversight of the A.I.D. Advisory Committee Management Officer.

(Sec. 621, Foreign Assistance Act of 1961, as amended (22 U.S.C. 2381); 
sec. 8(a) Federal Advisory Committee Pub. L. 92-463; E.O. 11686)
[40 FR 54778, Nov. 26, 1975]



Sec. 214.38  Submission of reports to the Library of Congress.

    (a) Each advisory committee is to file with the Library of Congress 
eight copies of each of its reports, except where the report falls 
within an exemption listed in 5 U.S.C. 552(b) or relates to a meeting 
which was closed for reasons of national security.
    (b) The A.I.D. Advisory Committee Representative provides copies of 
committee reports to the Office of Legislative Affairs for transmittal 
to the Library of Congress; and sends a copy to the A.I.D. Advisory 
Committee Management Officer for inclusion in the Agency's central file 
on advisory committees.
    (c) As appropriate, the A.I.D. Advisory Commmittee Representative 
may also send copies of background papers and other advisory committee 
documents to Office of Legislative Affairs for transmittal to the 
Library of Congress.



            Subpart E--Administration of Advisory Committees



Sec. 214.41  Support services.

    (a) A.I.D. provides support services for advisory committees which 
are established by or report to the Agency, unless the establishing 
authority provides otherwise.
    (b) Within A.I.D., support services are provided by and charged to 
the allotment of the A.I.D. office or bureau through which the advisory 
committee reports, and are coordinated by the

[[Page 742]]

designated A.I.D. Advisory Committee Representative.
    (c) Support services include staff, quarters, supplies, and funds.



Sec. 214.42  Uniform pay guidelines.

    (a) A.I.D. follows OMB/CSC guidelines in section 11 of OMB Circular 
A-63 in establishing rates of pay for advisory committee members, 
staffs, and consultants.
    (b) In summary, A.I.D. policy regarding compensation for advisory 
committee members is as follows:
    (1) Advisory committee members who are not employed by the U.S. 
Government ordinarily serve without compensation. However, they may be 
reimbursed for travel and related expenses of invitational travel under 
the provisions of A.I.D. travel regulations.
    (2) If committee members are appointed as A.I.D. consultants or 
experts, their compensation shall be fixed in accordance with CSC 
guidelines and regulations, and the general agreement between CSC and 
A.I.D.
    (3) Expenses of committee members are charged to the allotments of 
the A.I.D. office or bureau through which the advisory committee 
reports.



Sec. 214.43  Agency records.

    (a) The A.I.D. Advisory Committee Management Office maintains the 
Agency's Official central files on the nature functions, and operations 
of each A.I.D. advisory committee. Central files contain the following 
information with respect to each A.I.D. advisory committee:
    (1) Original copy of Advisory Committee Charter filed with the 
Administrator;
    (2) Official records copy of formal determinations by the A.I.D. 
Administrator with respect to the establishment renewal, operation, and 
termination of the committee;
    (3) Annual reports of committee activity;
    (4) Designations of Advisory Committee Representatives;
    (5) Location of the official files of the Advisory Committee.
    (b) Each A.I.D. Advisory Committee Representative maintains 
individual advisory committee files at a location known to the A.I.D. 
Advisory Committee Management Officer. These files contain the following 
information:
    (1) Copies of documents establishing, renewing, and terminating the 
committee;
    (2) Copies of committee charters filed with the A.I.D. 
Administrator;
    (3) Fiscal records which fully disclose the disposition of any funds 
made available to the committee;
    (4) Advisory committee records described above in Sec. 214.36(b) 
(i.e., the reports, transcripts, minutes, appendices, and other 
documents which were made available to, or prepared for or by, the 
committee).
    (c) The A.I.D. Advisory Committee Management Officer, the A.I.D. 
Auditor General, the OMB Secretariat, and the Comptroller General shall 
have access to these records.
    (d) Personnel documentation required by CSC and Agency regulations 
shall be maintained in the official personnel records of the Office of 
Personnel and Manpower.



Sec. 214.44  Annual review and reports.

    (a) A.I.D. conducts an annual comprehensive review of advisory 
committees under instructions provided by OMB Circular A-63, section 10, 
as amended and submits required data to OMB on the prescribed format, by 
November 30 of each year.
    (b) A.I.D. reports monthly to OMB on committee terminations or other 
significant changes in continuing A.I.D. Advisory Committees.
    (c) A.I.D. also provides information to the General Services 
Administration (GSA) for an annual report to Congress. The Agency report 
is due on February 1 of each year; includes only those advisory 
committees established by or reporting to A.I.D.; and is submitted on a 
form prescribed by GSA.
    (d) Within A.I.D., the Advisory Committee Management Officer 
collects required information from the A.I.D. Advisory Committee 
Representatives; appraises advisory committee activities for the 
Administrator; and prepares the Agency's reports for the Administrator.

[[Page 743]]



                   Subpart F--Administrative Remedies



Sec. 214.51  Administrative review of denial for public access to records.

    Any person whose request for access to an advisory committee 
document is denied may seek administrative review in accordance with 
Sec. 212.36(c) of A.I.D. Regulation 12, 22 CFR 212.36(c).



Sec. 214.52  Administrative review of other alleged non-compliance.

    With regard to other alleged non-compliance with the Act, OMB 
Circular A-63, or this regulation, the following procedures are to be 
used:
    (a) Advisory committee members or other aggrieved individuals or 
organizations must file a written complaint which contains specific 
information regarding the alleged non-compliance.
    (b) The written complaint must be addressed to the Administrator or 
Deputy Administrator, Agency for International Development, 21st and 
Virginia Avenue, NW., Washington, DC 20523.
    (c) The complaint must be filed within thirty (30) days after the 
date of the alleged non-compliance.
    (d) The complaint will be considered by the Administrator or Deputy 
Administrator with the advice and assistance of the General Counsel and 
the A.I.D. Advisory Committee Management Office.
    (e) Written notice of the disposition of the complaint shall be 
provided to the complainant within thirty (30) days of the date the 
complaint was received by the Agency.



PART 215--REGULATIONS FOR IMPLEMENTATION OF PRIVACY ACT OF 1974--Table of Contents




Sec.
215.1  Purpose and scope.
215.2  Definitions.
215.3  Procedures for requests pertaining to individual records in a 
          system of records.
215.4  Times, places and requirements for indentification of individuals 
          making requests.
215.5  Access to requested information by individuals.
215.6  Special procedures: Medical records.
215.7  Request for correction or amendment of record.
215.8  Agency review of request for amendment of record.
215.9  Appeal of initial adverse agency determination.
215.10  Disclosure of record to person other than the individual to whom 
          it pertains.
215.11  Fees.
215.12  Penalties and remedies.
215.13  General exemptions.
215.14  Specific exemptions.

    Authority:  Sec. 621, Foreign Assistance Act of 1961, as amended, 
(22 U.S.C. 2381; 75 Stat. 445); secs. 3,4, Administrative Procedure Act 
(5 U.S.C. 553; 60 Stat. 237); Privacy Act of 1974 (Pub. L. 93-579; 5 
U.S.C. 552a; 88 Stat. 1896).

    Source:  57 FR 38277, Aug. 24, 1992, unless otherwise noted.



Sec. 215.1  Purpose and scope.

    (a) It is the purpose and objective of the International Development 
Cooperation Agency and the Agency for International Development to 
collect information, revise personal data collection forms or processes, 
and maintain Agency records in a manner that will prevent an unwarranted 
invasion of privacy of those individuals who are the subject of Agency 
records.
    (b) These regulations establish the procedures by which an 
individual may obtain notification of the existence of Agency records 
pertaining to that individual, gain access to those records, request an 
amendment or correction to the records, and appeal adverse decisions to 
requests for amendment or correction of Agency records.
    (c) The Agency separately states and publishes in the Federal 
Register a public notice of the existence and character of systems 
maintained by the Agency, pursuant to the provisions of sections (e)(4) 
and (e)(11) of the Privacy Act of 1974 (5 U.S.C. 552a; 88 Stat. 1896).



Sec. 215.2  Definitions.

    (a) Act means the Privacy Act of 1974 (5 U.S.C. 552a; 88 Stat. 
1896);
    (b) Agency means the International Development Cooperation Agency or 
the Agency for International Development, its offices, bureaus, 
divisions, and posts abroad;
    (c) Amend shall include the amendment of a record;
    (d) Individual means a citizen of the United States or an alien 
lawfully admitted for permanent residence;

[[Page 744]]

    (e) Maintain includes maintain, collect, use or disseminate;
    (f) Record means any item, collection, or grouping of information 
about an individual that is maintained by an agency, including, but not 
limited to, his education, financial transactions, medical history, and 
criminal or employment history and that contains his name, or the 
identifying number, symbol, or other identifying particular assigned to 
the individual, such as a finger or voice print or a photograph;
    (g) Routine use means, with respect to the disclosure of a record, 
the use of such record for a purpose which is compatible with the 
purpose for which it was collected;
    (h) Statistical record means a record in a system of records 
maintained for statistical research or reporting purposes only and not 
used in whole or in part in making any determination about an 
identifiable individual, except as provided by section 8 of title 13;
    (i) System of records means a group of any records under the control 
of any agency from which information is retrieved by the name of the 
individual or by some identifying number, symbol, or other identifying 
particular assigned to the individual.



Sec. 215.3  Procedures for requests pertaining to individual records in a system of records.

    (a) Requests for notification of access to or amendment of Agency 
records contained in a system of records pertaining to an individual may 
be made in person or by mail as follows: For the International 
Development Cooperation Agency-Assistant Director for Administration, 
International Development Cooperation Agency, Room 4889 New State, 2201 
C Street, NW., Washington, DC 20523 Attention: Privacy Liaison Officer. 
For the Agency for International Development-Privacy Liaison Officer, 
Agency for International Development, Room 4889 New State, 2201 C 
Street, NW., Washington, DC 20523.
    (b) Such request should include information necessary to identify 
the record, e.g., the individual's full name, date of birth, place of 
birth, present mailing address, or system of record identification name 
and number, if known, and, to facilitate the retrieval of records 
contained in those systems of records which are retrieved by social 
security numbers, the social security number of the individual to whom 
the record pertains.
    (c) With respect to a system of records which may be maintained by 
the Agency in offices outside the United States, an individual may 
inquire whether he or she is the subject of an Agency record or may 
request access to or amendment of such records by appearing in person or 
by writing to the Privacy Liaison Officer, Agency for International 
Development, at the overseas missions.
    (d) The Assistant Director for Administration for requests to 
I.D.C.A. or the appropriate Privacy Liaison Officer for request to 
A.I.D., or their designees shall, within ten (10) working days of 
receipt of the request, furnish in writing to the requesting individual 
notice of the existence or nonexistence of any records described in the 
request.



Sec. 215.4  Times, places, and requirements for identification of individuals making requests.

    (a) Individuals making personal requests for notification, access or 
contest may do so at the place designated in paragraph (a) of 
Sec. 215.3, which is open 9 a.m. to 5 p.m. daily, except Saturdays, 
Sundays, and legal public holidays.
    (b) Individuals making personal requests for notification, access or 
contest at offices outside the United States may do so at the overseas 
missions during the regular business hours of those offices.
    (c) An individual requesting such information in person shall 
provide such personal identification as is reasonable under the 
circumstances to verify the individual's identity; e.g. driver's 
license, employee identification card or medicare card. (The 
identification should contain a photograph of the individual.)
    (d) An individual requesting such information by mail shall include 
in his or her request a signed notarized statement to verify his or her 
identity and which stipulates that the individual understands that 
knowingly or willfully seeking or obtaining access to records about 
another individual under

[[Page 745]]

false pretenses is punishable by a fine up to $5,000, as provided in 
section (i)(3) of the Act.
    (e) Verification of identity as set forth in paragraphs (c) and (d) 
of this section shall not be required of individuals seeking access to 
records otherwise available to members of the public under the Freedom 
of Information Act (5 U.S.C. 552; 88 Stat. 1561).
    (f) An individual who wishes to be accompanied by another person 
when reviewing a record shall furnish the Agency with a written 
statement authorizing discussion of his or her record in the presence of 
the accompanying person. Such statement need not contain any reasons for 
the access or for the accompanying person's presence.



Sec. 215.5  Access to requested information by individuals.

    (a) Upon receipt of a request by an individual made in accordance 
with the provisions of Sec. 215.3, such individual shall be granted 
access to any record pertaining to him or her which is contained in a 
system of records maintained by the Agency subject to exemptions 
discussed in Secs. 215.13 and 215.14.
    (b) Notwithstanding the provisions of paragraph (a) of this section, 
access will not be allowed an individual to information or records 
compiled by the Agency in reasonable anticipation of a civil or criminal 
action or proceeding.
    (c) Whenever possible, access to requested records will be granted;
    (1) Where the request is presented in person and the record is 
readily available, promptly upon receipt of the request for access, 
determination that access to the record may be granted, verification of 
the identity of the individual seeking access, and, where applicable, 
receipt of consent to discuss the record with a person accompanying the 
individual;
    (2) Where the request is made by mail, the record will, whenever 
possible, be provided within ten (10) working days of receipt of the 
request.
    (d) Where access to a record cannot reasonably be granted as 
provided in paragraphs (c)(1) and (2) of this section, the Agency will 
acknowledge in writing receipt of the request for access and indicate a 
reasonable time within which access to the record can be granted.
    (e) Where no reasonable means exist for an individual to have access 
to his or her record in person, a copy of the record must be provided 
through the mail.



Sec. 215.6  Special procedures: Medical records.

    If the Assistant Director for Administration or the Privacy Liaison 
Officer, determines that the release directly to the individual of 
medical records maintained by the Agency could have an adverse effect 
upon such individual, the Director/Officer will attempt to arrange an 
alternative acceptable to both the individual and Agency (such as the 
release of said information to a doctor named by the individual) in 
granting access to such record.



Sec. 215.7  Request for correction or amendment of record.

    (a) An individual may request the Agency to correct or amend a 
record pertaining to him or her which the individual believes is not 
accurate, relevant, timely or complete.
    (b) Such request must be in writing and must be presented, in person 
or by mail to the addresses listed in Sec. 215.3(a).
    (c) Such requests must set forth the following information:
    (1) Identification of the system of records in which the particular 
record is maintained;
    (2) The portion(s) of the record to be amended or corrected;
    (3) The desired amendment or correction; and
    (4) The reasons for the amendment or correction.

The request must be accompanied by evidence, documentation, or other 
information in support of the request.
    (d) Assistance in preparing a request to amend a record may be 
obtained from the officials listed in Sec. 215.3(a).



Sec. 215.8  Agency review of request for amendment of record.

    (a) The Agency will examine the information requested to be amended 
to determine its accuracy, timeliness, completeness, and its relevancy 
and necessity to accomplish a purpose of the

[[Page 746]]

Agency required to be accomplished by statute or by executive order.
    (b) Within ten (10) working days after the receipt by the Assistant 
Director for Administration or the Privacy Liaison Officer, of a request 
made in accordance with this section, the Assistant Director for 
Administration or the Privacy Liaison Officer shall acknowledge in 
writing such receipt and shall, after examination in accordance with the 
provisions of paragraph (a) of this section, promptly either:
    (1) Make any amendment of any portion thereof which the individual 
believes is not accurate, relevant, timely or complete, and notify the 
individual of the amendment made; or
    (2) Inform the individual of the Agency's refusal to amend the 
record in accordance with the request, the reason(s) for the refusal, 
and the procedures established by the Agency for the individual to 
request a review of that refusal.
    (c) If the Agency agrees with the individual's request to amend a 
record, in addition to proceeding as set forth in paragraph (b)(1) of 
this section, it shall promptly advise all previous recipients of the 
record of the fact that the amendment was made and the substance of the 
amendment where an accounting of disclosures has been made.
    (d) If unusual circumstances prevent the completion of Agency action 
on the request to amend within 30 days after the receipt thereof by the 
Assistant Director for Administration or the Privacy Liaison Officer, 
the individual will be promptly advised of the delay, the reasons for 
the delay, and of the date by which the review is expected to be 
completed.
    (e) If the Agency, after its initial examination of the record and 
the request for Amendment, disagrees with all or any part of the 
individual's request to amend it shall:
    (1) To the extent the Agency agrees with any part of the 
individual's request to amend, proceed as described in paragraphs (b)(1) 
and (c) of this section;
    (2) Advise the individual of its refusal and the reason(s) therefor;
    (3) Inform the individual that he or she may request a further 
review by the Director or the Administrator, or their designees; and
    (4) Describe the procedures for requesting such review, including 
the name and address of the official to whom the request should be 
directed.
    (f) No part of these regulations shall be construed to permit:
    (1) The alteration of evidence presented in the course of judicial, 
quasi-judicial or quasi-legislative proceedings;
    (2) Collateral attack upon any matter which has been the subject of 
judicial or quasi-judicial action; or
    (3) An amendment or correction which would be in violation of an 
existing statute, executive order or regulation.



Sec. 215.9  Appeal of initial adverse agency determination.

    (a) An individual who disagrees with the denial or partial denial of 
his or her request to amend a record may file a request for review of 
such refusal within 60 days after the date of notification of the denial 
or partial denial.
    (b) The request for review must be in writing and may be presented 
in person or by mail to:

    Director, International Development Cooperation Agency, 2201 C 
Street, NW., Washington, DC 20523. Attention: Privacy Review Request.
    Director, Office of External Affairs, Agency for International 
Development, 2201 C Street, NW., Washington, DC 20523. Attention: 
Privacy Review Request.


Both the envelope and the letter should be clearly marked: Attention: 
Privacy Review Request. Such request should include any documentation, 
information or statements advanced for the amendment of the record, and 
a copy of the initial adverse determination.
    (c) Upon receipt of the request for review, the Director or the 
Assistant Administrator, or an officer of the Agency designated in 
writing by the Director or Administrator, shall undertake an independent 
review of the initial determination.
    (d) If someone other than the Director or the Assistant 
Administrator is designated to conduct the review, he or she shall be an 
officer who is organizationally independent of or senior to the officer 
or employee who made the initial determination.

[[Page 747]]

    (e) In conducting the review, the reviewing official, may at his or 
her option, request such additional information as is deemed necessary 
to establish that the record contains only that information which is 
accurate, timely, complete and necessary to assure fairness in any 
determination which may be made about the individual on the basis of the 
record.
    (f) Within 30 days after receipt of the request for review, the 
Director, the Assistant Administrator, or the official designated to 
conduct the review, shall advise the individual of the Agency's final 
decision. If unusual circumstances prevent the completion of the review 
within the 30-day period, the Agency shall, prior to the expiration of 
the 30-day period, advise the individual in writing of the circumstances 
preventing the completion of such review and inform him or her of the 
date by which the review is expected to be completed.
    (g) If the reviewing official determines that the record should be 
amended in accordance with the individual's request, the Agency shall:
    (1) Amend the record accordingly;
    (2) Advise the individual of the amendment; and
    (3) Where an accounting of disclosures has been made, advise all 
previous recipients of the fact that the amendment was made and the 
nature of the amendment.
    (h) If, after conducting the review, the reviewing official refuses 
to amend the record, in whole or in part, in accordance with the 
individual's request, Agency shall advise the individual:
    (1) Of its refusal and the reasons therefor;
    (2) Of the individual's right to file a concise statement of his or 
her reasons for disagreeing with the Agency's decision;
    (3) Of the procedures for filing a statement of disagreement;
    (4) That any such statement will be sent to anyone to whom the 
record is subsequently disclosed, together with a brief statement by the 
Agency summarizing its reasons for refusing to amend the record;
    (5) That to the extent an accounting of disclose was maintained, 
prior recipients of the disputed record will be provided a copy of any 
statement of disagreement and of the Agency's statement summarizing its 
reasons for refusing to amend the record; and
    (6) Of the individual's right to seek judicial review of the 
Agency's refusal to amend a record as provided for in section (g)(1)(a) 
of the Act.



Sec. 215.10  Disclosure of record to person other than the individual to whom it pertains.

    (a) Subject to the conditions of paragraphs (b) and (c) of this 
section, the Agency shall not disclose any record which is contained in 
a system of records by any means of communication to any person or other 
agency who is not the individual to whom the record pertains.
    (b) Upon written request or with prior written consent of the 
individual to whom the record pertains, the Agency may disclose any such 
record to a person or to another agency as requested or authorized.
    (c) Notwithstanding the absence of written consent from the 
individual to whom the record pertains, the Agency may disclose any such 
record provided such disclosure is:
    (1) To those officers and employees of the Agency who have a need 
for the record in the performance of their duties;
    (2) Required under the Freedom of Information Act (5 U.S.C. 552);
    (3) For a routine use as defined in Sec. 215.2;
    (4) To the Bureau of the Census for purposes of planning or carrying 
out a census or survey or related activity pursuant to the provisions of 
title 13 of the United States Code;
    (5) To a recipient who has provided the Agency with adequate advance 
written assurance that the record will be used solely as a statistical 
research or reporting record, and the record is to be transferred in a 
form that is not individually identifiable;
    (6) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government, or for evaluation by the 
Administrator of General Services or his or her designee,

[[Page 748]]

to determine whether the record has such value;
    (7) To another agency or to an instrumentality of any governmental 
jurisdiction within or under the control of the United States for a 
civil or criminal law enforcement activity authorized by law: Provided, 
The head of the agency or instrumentality has made a prior written 
request to the Assistant Administrator of Administration or the Privacy 
Liaison Officer, specifying the particular record and the law 
enforcement activity for which it is sought;
    (8) To a responsible person pursuant to a showing of compelling 
circumstances affecting the health or safety of an individual if upon 
such disclosure notification will be transmitted to the last known 
address of such individual;
    (9) To either House of Congress, or, to the extent of a matter 
within its jurisdiction, any committee or subcommittee, or joint 
committee of Congress, or subcommittee of such joint committee;
    (10) To the Comptroller General, or any of his/her authorized 
representatives, in the course of the performance of the duties of the 
General Accounting Office;
    (11) Pursuant to an order of a court of competent jurisdiction or;
    (12) To a consumer reporting agency in accordance with section 
3711(f) of title 31.



Sec. 215.11  Fees.

    (a) The only fees to be charged to or collected from an individual 
under the provisions of this part are for copying records at the request 
of the individual.
    (b) No fees shall be charged or collected for the following: Search 
for and retrieval of the records; review of the records; copying at the 
initiative of the Agency without a request from the individual; the 
first 100 pages; and first-class postage. However if special handling or 
other than first-class mail is requested or required, the costs shall be 
added to the basic fee.
    (c) The copying fees prescribed in paragraph (a) of this section 
are:

    Ten (10) cents per page. Twenty (20) cents per page of computer 
printout.

    (d) Payment may be in the form of a check, bank draft on a bank in 
the United States, or postal money order payable to the Treasurer of the 
United States.
    (e) A receipt for fees paid will be given only upon request.
    (f) A copying fee totaling $15.00 or less shall be waived but the 
copying fees for contemporaneous requests by the same individual shall 
be aggregated to determine the total fee.
    (g) A fee may be reduced or waived by the Privacy Liaison Officer.



Sec. 215.12  Penalties and remedies.

    The provisions of the Act relating to penalties and remedies are 
summarized below:
    (a) An individual may bring a civil action against the Agency when 
the Agency:
    (1) Makes a determination not to amend a record in accordance with 
the individual's request;
    (2) Refuses to comply with an individual's request pursuant to 5 
U.S.C. 552a (d)(1);
    (3) Fails to maintain a record concerning an individual with such 
accuracy, relevance, timeliness and completeness as is necessary to 
assure fairness in any determination relating to the qualifications, 
character, rights, or opportunities of, or benefits to the individual 
that may be made on the basis of such record, and as a result thereof a 
determination is made which is adverse to the individual; or
    (4) Fails to comply with any other provision of section (d) of the 
Act in such a way as to have an adverse effect on an individual.
    (b) The court may order the correction or amendment of the records, 
may enjoin the Agency from withholding the records, may order the Agency 
to produce any records improperly withheld, and may assess attorney's 
fees and costs.
    (c) Where a court of competent jurisdiction makes a determination 
that the Agency action was willful or intentional with respect to 5 
U.S.C. 552a (g)(1) (c) or (d), the United States shall be liable for 
actual damages of no less than $1,000, the costs of the action, and 
attorneys' fees.

[[Page 749]]

    (d) Criminal penalties may be imposed against an officer or employee 
of the Agency who willfully discloses material which he or she knows is 
prohibited from disclosure, or who maintains a system of records without 
complying with the notice requirements.
    (e) Criminal penalties may be imposed against any person who 
knowingly and willfully requests or obtains any record concerning an 
individual from an agency under false pretenses. The offenses enumerated 
in paragraphs (d) and (e) of this section are misdemeanors, with fines 
not to exceed $5,000.



Sec. 215.13  General exemptions.

    (a) Pursuant to 5 U.S.C. 552a (j)(2), the Director or the 
Administrator may, where there is a compelling reason to do so, exempt a 
system of records within the Agency from any part of the Act, except 
subsections (b), (c) (1) and (2), (e)(4)(A) through (F), (e) (6), (7), 
(9), (10), and (11), and (i) thereof, if the system of records is 
maintained by the Agency or component thereof which performs as its 
principal function any activity pertaining to the enforcement of 
criminal laws, including police efforts to prevent, control, or reduce 
crime or to apprehend criminals, and the activities of prosecutors, 
courts, correctional, probation, pardon, or parole authorities, and 
which consists of:
    (1) Information compiled for the purpose of identifying individual 
criminal offenders and alleged offenders and consisting only of 
identifying data and notations of arrests, the nature and disposition of 
criminal charges, sentencing, confinement, release, and parole and 
probation status;
    (2) Information compiled for the purpose of a criminal 
investigation, including reports of informants and investigators, and 
associated with an identifiable individual; or
    (3) Reports identifiable to an individual compiled at any stage of 
the process of enforcement of the criminal laws from arrest or 
indictment through release from supervision.
    (b) Each notice of a system of records that is the subject of an 
exemption under this section will include a statement that the system 
has been exempted, the reasons therefore, and a reference to the Federal 
Register, volume and page, where the exemption rule can be found.
    (c) The systems of records to be exempted under section (j)(2) of 
the Act, the provisions of the Act from which they are being exempted, 
and the justification for the exemptions, are set forth below:
    (1) Criminal Law Enforcement Records. This system of records is to 
be exempted from sections (c) (3) and (4); (d); (e) (1), (2), and (3); 
(e) (4) (G), (H), and (I); (e) (5) and (8); (f), (g) and (h) of the Act. 
These exemptions are necessary to insure the proper functioning of the 
law enforcement activity, to protect confidential sources of 
information, to fulfill promises of confidentiality, to maintain the 
integrity of the law enforcement procedures, to avoid premature 
disclosure of the knowledge of criminal activity and the evidentiary 
bases of possible enforcement actions, to prevent interference with law 
enforcement proceeding, to avoid the disclosure of investigative 
techniques, and to avoid the endangering the law enforcement personnel.
    (2)  [Reserved]



Sec. 215.14  Specific exemptions.

    (a) Pursuant to 5 U.S.C. 552a(k), the Director or the Administrator 
may, where there is a compelling reason to do so, exempt a system of 
records, from any of the provisions of subsections (c) (3); (d); (e)(1); 
(e)(4) (G), (H), and (I); and (f) of the Act if a system of records is:
    (1) Subject to the provisions of 5 U.S.C. 552(b)(1);
    (2) Investigatory material compiled for law enforcement purposes, 
other than material within the scope of subsection (j)(2) of the Act: 
Provided, however, That if any individual is denied any right, 
privilege, or benefit to which he or she would otherwise be eligible, as 
a result of the maintenance of such material, such material shall be 
provided to such individual, except to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or prior to the effective 
date of this section, under

[[Page 750]]

an implied promise that the identity of the source would be held in 
confidence;
    (3) Maintained in connection with providing protective services to 
the President of the United States or other individuals pursuant to 18 
U.S.C. 3056;
    (4) Required by statute to be maintained and used solely as 
statistical records;
    (5) Investigatory material compiled solely for the purpose of 
determining suitability, eligibility, or qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information, but only to the extent that the disclosure of 
such material would reveal the identity of a source who furnished 
information to the Government under an express promise that the identity 
of the source would be held in confidence, or, prior to the effective 
date of this section, under an implied promise that the identity of the 
source would be held in confidence;
    (6) Testing or examination material used solely to determine 
individual qualifications for appointment or promotion in the Federal 
service, the disclosure of which would compromise the objectivity or 
fairness of the testing or examination process; or
    (7) Evaluation material used to determine potential for promotion in 
the armed services, but only to the extent that the disclosure of such 
material would reveal the identity of a source who furnished information 
to the Government under an express promise that the identity of the 
source would be held in confidence, or, prior to the effective date of 
this section, under an implied promise that the identity of the source 
would be held in confidence.
    (b) Each notice of a system of records that is the subject of an 
exemption under 5 U.S.C. 552a(k) will include a statement that the 
system has been exempted, the reasons therefore, and a reference to the 
Federal Register, volume and page, where the exemption rule can be 
found.
    (c) The systems of records to be exempted under section (k) of the 
Act, the provisions of the Act from which they are being exempted, and 
the justification for the exemptions, are set forth below:
    (1) Criminal Law Enforcement Records. If the 5 U.S.C. 552a(j)(2) 
exemption claimed under paragraph (c) of Sec. 215.13 and on the notice 
of systems of records to be published in the Federal Register on this 
same date is held to be invalid, then this system is determined to be 
exempt, under 5 U.S.C. 552(a)(k) (1) and (2) of the Act, from the 
provisions of 5 U.S.C. 552a (c)(3); (d); (e)(1); (e)(4); (G); (H); (I); 
and (f). The reasons for asserting the exemptions are to protect the 
materials required by executive order to be kept secret in the interest 
of the national defense or foreign policy, to prevent subjects of 
investigation from frustrating the investigatory process, to insure the 
proper functioning and integrity of law enforcement activities, to 
prevent disclosure of investigative techniques, to maintain the ability 
to obtain necessary information, to fulfill commitments made to sources 
to protect their identities and the confidentiality of information and 
to avoid endangering these sources and law enforcement personnel.
    (2) Personnel Security and Suitability Investigatory Records. This 
system is exempt under U.S.C. 552a (k)(1), (k)(2), and (k)(5) from the 
provisions of 5 U.S.C. 552a (c)(3); (d); (e)(1); (e)(4); (G); (H); (I); 
and (f). These exemptions are claimed to protect the materials required 
by executive order to be kept secret in the interest of national defense 
or foreign policy, to prevent subjects of investigation from frustrating 
the investigatory process, to insure the proper functioning and 
integrity of law enforcement activities, to prevent disclosure of 
investigative techniques, to maintain the ability to obtain candid and 
necessary information, to fulfill commitments made to sources to protect 
the confidentiality of information, to avoid endangering those sources 
and, ultimately, to facilitate proper selection or continuance of the 
best applicants or persons for a given position or contract. Special 
note is made of the limitation on the extent to which this exemption may 
be asserted.
    (3) Litigation Records. This system is exempt under 5 U.S.C. 
552(k)(1), (k)(2), and (k)(5) from the provisions of 5 U.S.C. 552a 
(c)(3); (d); (e)(1); (e)(4) (G), (H), (I); and (f). These exemptions are

[[Page 751]]

claimed to protect the materials required by executive order to be kept 
secret in the interest of national defense or foreign policy, to prevent 
subjects of investigation from frustrating the investigatory process, to 
insure the proper functioning and integrity of law enforcement 
activities, to prevent disclosure of investigative techniques, to 
maintain the ability to obtain candid and necessary information, to 
fulfill commitments made to sources to protect the confidentiality of 
information.
    (4) Employee Equal Employment Opportunity Complaint Investigatory 
Records. This system is exempt under 5 U.S.C. 552a (k)(1) and (k)(2) 
from the provisions of 5 U.S.C. 552a (c)(3); (d); (e)(1); (e)(4) (G), 
(H), (I); and (f). These exemptions are claimed to protect the materials 
required by executive order to be kept secret in the interest of 
national defense or foreign policy, to prevent subjects of investigation 
from frustrating the investigatory process, to insure the proper 
functioning and integrity of law enforcement activities, to prevent 
disclosure of investigative techniques, to maintain the ability to 
obtain candid and necessary information, to fulfill commitments made to 
sources to protect the confidentiality of information, to avoid 
endangering these sources.
    (5) The following systems of records are exempt under 5 U.S.C. 552a 
(k)(5) from the provision of 5 U.S.C. 552a (c)(3); (d); (e)(1); (e)(4) 
(G), (H), (I); and (f):
    (i) Employee Conduct and Discipline Records.
    (ii) Employee Relations Records.

This exemption is claimed for these systems of records to maintain the 
ability to obtain candid and necessary information, to fulfill 
commitments made to sources to protect the confidentiality of 
information, to avoid endangering these sources and, ultimately, to 
facilitate proper selection or continuance of the best applicants or 
persons for a given position or contract. Special note is made of the 
limitation on the extent to which this exemption may be asserted. The 
existence and general character of the information exempted will be made 
known to the individual to whom it pertains.



PART 216--ENVIRONMENTAL PROCEDURES--Table of Contents




Sec.
216.1  Introduction.
216.2  Applicability of procedures.
216.3  Procedures.
216.4  Private applicants.
216.5  Endangered species.
216.6  Environmental assessments.
216.7  Environmental impact statements.
216.8  Public hearings.
216.9  Bilateral and multi-lateral studies and concise reviews of 
          environmental issues.
216.10  Records and reports.

    Authority:  42 U.S.C.4332; 22 U.S.C. 2381.

    Source:  41 FR 26913, June 30, 1976, unless otherwise noted.



Sec. 216.1  Introduction.

    (a) Purpose. In accordance with sections 118(b) and 621 of the 
Foreign Assistance Act of 1961, as amended, (the FAA) the following 
general procedures shall be used by A.I.D. to ensure that environmental 
factors and values are integrated into the A.I.D. decision making 
process. These procedures also assign responsibility within the Agency 
for assessing the environmental effects of A.I.D.'s actions. These 
procedures are consistent with Executive Order 12114, issued January 4, 
1979, entitled Environmental Effects Abroad of Major Federal Actions, 
and the purposes of the National Environmental Policy Act of 1970, as 
amended (42 U.S.C. 4371 et seq.) (NEPA). They are intended to implement 
the requirements of NEPA as they effect the A.I.D. program.
    (b) Environmental policy. In the conduct of its mandate to help 
upgrade the quality of life of the poor in developing countries, A.I.D. 
conducts a broad range of activities. These activities address such 
basic problems as hunger, malnutrition, overpopulation, disease, 
disaster, deterioration of the environment and the natural resource 
base, illiteracy as well as the lack of adequate housing and 
transportation. Pursuant to the FAA, A.I.D. provides development 
assistance in the form of technical advisory services, research, 
training, construction and commodity support. In addition, A.I.D. 
conducts programs under the Agricultural Trade Development and 
Assistance Act of 1954 (Pub. L. 480) that are designed to

[[Page 752]]

combat hunger, malnutrition and to facilitate economic development. 
Assistance programs are carried out under the foreign policy guidance of 
the Secretary of State and in cooperation with the governments of 
sovereign states. Within this framework, it is A.I.D. policy to:
    (1) Ensure that the environmental consequences of A.I.D.-financed 
activities are identified and considered by A.I.D. and the host country 
prior to a final decision to proceed and that appropriate environmental 
safeguards are adopted;
    (2) Assist developing countries to strengthen their capabilities to 
appreciate and effectively evaluate the potential environmental effects 
of proposed development strategies and projects, and to select, 
implement and manage effective environmental programs;
    (3) Identify impacts resulting from A.I.D.'s actions upon the 
environment, including those aspects of the biosphere which are the 
common and cultural heritage of all mankind; and
    (4) Define environmental limiting factors that constrain development 
and identify and carry out activities that assist in restoring the 
renewable resource base on which sustained development depends.
    (c) Definitions--(1) CEQ regulations. Regulations promulgated by the 
President's Council on Environmental Quality (CEQ) (Federal Register, 
Volume 43, Number 230, November 29, 1978) under the authority of NEPA 
and Executive Order 11514, entitled Protection and Enhancement of 
Environmental Quality (March 5, 1970) as amended by Executive Order 
11991 (May 24, 1977).
    (2) Initial Environmental Examination. An Initial Environmental 
Examination is the first review of the reasonably foreseeable effects of 
a proposed action on the environment. Its function is to provide a brief 
statement of the factual basis for a Threshold Decision as to whether an 
Environmental Assessment or an Environmental Impact Statement will be 
required.
    (3) Threshold Decision. A formal Agency decision which determines, 
based on an Initial Environmental Examination, whether a proposed Agency 
action is a major action significantly affecting the environment.
    (4) Environmental Assessment. A detailed study of the reasonably 
forseeable significant effects, both beneficial and adverse, of a 
proposed action on the environment of a foreign country or countries.
    (5) Environmental Impact Statement. A detailed study of the 
reasonably foreseeable environmental impacts, both positive and 
negative, of a proposed A.I.D. action and its reasonable alternatives on 
the United States, the global environment or areas outside the 
jurisdiction of any nation as described in Sec. 216.7 of these 
procedures. It is a specific document having a definite format and 
content, as provided in NEPA and the CEQ Regulations. The required form 
and content of an Environmental Impact Statement is further described in 
Sec. 216.7 infra.
    (6) Project Identification Document (PID). An internal A.I.D. 
document which initially identifies and describes a proposed project.
    (7) Program Assistance Initial Proposal (PAIP). An internal A.I.D. 
document used to initiate and identify proposed non-project assistance, 
including commodity import programs. It is analogous to the PID.
    (8) Project Paper (PP). An internal A.I.D. document which provides a 
definitive description and appraisal of the project and particularly the 
plan or implementation.
    (9) Program Assistance Approval Document (PAAD). An internal A.I.D. 
document approving non-project assistance. It is analogous to the PP.
    (10) Environment. The term environment, as used in these procedures 
with respect to effects occurring outside the United States, means the 
natural and physical environment. With respect to effects occurring 
within the United States see Sec. 216.7(b).
    (11) Significant effect. With respect to effects on the environment 
outside the United States, a proposed action has a significant effect on 
the environment if it does significant harm to the environment.
    (12) Minor donor. For purposes of these procedures, A.I.D. is a 
minor donor to a multidonor project when A.I.D. does not control the 
planning or

[[Page 753]]

design of the multidonor project and either (i) A.I.D.'s total 
contribution to the project is both less than $1,000,000 and less than 
25 percent of the estimated project cost, or (ii) A.I.D.'s total 
contribution is more than $1,000,000 but less than 25 percent of the 
estimated project cost and the environmental procedures of the donor in 
control of the planning of design of the project are followed, but only 
if the A.I.D. Environmental Coordinator determines that such procedures 
are adequate.
[45 FR 70244, Oct. 23, 1980]



Sec. 216.2  Applicability of procedures.

    (a) Scope. Except as provided in Sec. 216.2(b), these procedures 
apply to all new projects, programs or activities authorized or approved 
by A.I.D. and to substantive amendments or extensions of ongoing 
projects, programs, or activities.
    (b) Exemptions. (1) Projects, programs or activities involving the 
following are exempt from these procedures:
    (i) International disaster assistance;
    (ii) Other emergency circumstances; and
    (iii) Circumstances involving exceptional foreign policy 
sensitivities.
    (2) A formal written determination, including a statement of the 
justification therefore, is required for each project, program or 
activity for which an exemption is made under paragraphs (b)(1) (ii) and 
(iii) of this section, but is not required for projects, programs or 
activities under paragraph (b)(1)(i) of this section. The determination 
shall be made either by the Assistant Administrator having 
responsibility for the program, project or activity, or by the 
Administrator, where authority to approve financing has been reserved by 
the Administrator. The determination shall be made after consultation 
with CEQ regarding the environmental consequences of the proposed 
program, project or activity.
    (c) Categorical exclusions. (1) The following criteria have been 
applied in determining the classes of actions including in 
Sec. 216.2(c)(2) for which an Initial Environmental Examination, 
Environmental Assessment and Environmental Impact Statement generally 
are not required;
    (i) The action does not have an effect on the natural or physicial 
environment;
    (ii) A.I.D. does not have knowledge of or control over, and the 
objective of A.I.D. in furnishing assistance does not require, either 
prior to approval of financing or prior to implementation of specific 
activities, knowledge of or control over, the details of the specific 
activities that have an effect on the physicial and natural environment 
for which financing is provided by A.I.D.;
    (iii) Research activities which may have an affect on the physicial 
and natural environment but will not have a significant effect as a 
result of limited scope, carefully controlled nature and effective 
monitoring.
    (2) The following classes of actions are not subject to the 
procedures set forth in Sec. 216.3, except to the extent provided 
herein;
    (i) Education, technical assistance, or training programs except to 
the extent such programs include activities directly affecting the 
environment (such as construction of facilities, etc.);
    (ii) Controlled experimentation exclusively for the purpose of 
research and field evaluation which are confined to small areas and 
carefully monitored;
    (iii) Analyses, studies, academic or research workshops and 
meetings;
    (iv) Projects in which A.I.D. is a minor donor to a multidonor 
project and there is no potential significant effects upon the 
environment of the United States, areas outside any nation's 
jurisdiction or endangered or threatened species or their critical 
habitat;
    (v) Document and information transfers;
    (vi) Contributions to international, regional or national 
organizations by the United States which are not for the purpose of 
carrying out a specifically identifiable project or projects;
    (vii) Institution building grants to research and educational 
institutions in the United States such as those provided for under 
section 122(d) and title XII of chapter 2 of part I of the FAA (22 USCA 
2151 p. (b) 2220a. (1979));
    (viii) Programs involving nutrition, health care or population and 
family planning services except to the extent

[[Page 754]]

designed to include activities directly affecting the environment (such 
as construction of facilities, water supply systems, waste water 
treatment, etc.)
    (ix) Assistance provided under a Commodity Import Program when, 
prior to approval, A.I.D. does not have knowledge of the specific 
commodities to be financed and when the objective in furnishing such 
assistance requires neither knowledge, at the time the assistance is 
authorized, nor control, during implementation, of the commodities or 
their use in the host country.
    (x) Support for intermediate credit institutions when the objective 
is to assist in the capitalization of the institution or part thereof 
and when such support does not involve reservation of the right to 
review and approve individual loans made by the institution;
    (xi) Programs of maternal or child feeding conducted under title II 
of Pub. L. 480;
    (xii) Food for development programs conducted by food recipient 
countries under title III of Pub. L. 480, when achieving A.I.D.'s 
objectives in such programs does not require knowledge of or control 
over the details of the specific activities conducted by the foreign 
country under such program;
    (xiii) Matching, general support and institutional support grants 
provided to private voluntary organizations (PVOs) to assist in 
financing programs where A.I.D.'s objective in providing such financing 
does not require knowledge of or control over the details of the 
specific activities conducted by the PVO;
    (xiv) Studies, projects or programs intended to develop the 
capability of recipient countries to engage in development planning, 
except to the extent designed to result in activities directly affecting 
the environment (such as construction of facilities, etc.); and
    (xv) Activities which involve the application of design criteria or 
standards developed and approved by A.I.D.
    (3) The originator of a project, program or activity shall determine 
the extent to which it is within the classes of actions described in 
paragraph (c)(2) of this section. This determination shall be made in 
writing and be submitted with the PID, PAIP or comparable document. This 
determination, which must include a brief statement supporting 
application of the exclusion shall be reviewed by the Bureau 
Environmental Officer in the same manner as a Threshold Decision under 
Sec. 216.3(a)(2) of these procedures. Notwithstanding paragraph (c)(2) 
of this section, the procedures set forth in Sec. 216.3 shall apply to 
any project, program or activity included in the classes of actions 
listed in paragraph (c)(2) of this section, or any aspect or component 
thereof, if at any time in the design, review or approval of the 
activity it is determined that the project, program or activity, or 
aspect or component thereof, is subject to the control of A.I.D. and may 
have a significant effect on the environment.
    (d) Classes of actions normally having a significant effect on the 
environment. (1) The following classes of actions have been determined 
generally to have a significant effect on the environment and an 
Environmental Assessment or Environmental Impact Statement, as 
appropriate, will be required:
    (i) Programs of river basin development;
    (ii) Irrigation or water management projects, including dams and 
impoundments;
    (iii) Agricultural land leveling;
    (iv) Drainage projects;
    (v) Large scale agricultural mechanization;
    (vi) New lands development;
    (vii) Resettlement projects;
    (viii) Penetration road building or road improvement projects;
    (ix) Powerplants;
    (x) Industrial plants;
    (xi) Potable water and sewerage projects other than those that are 
small-scale.
    (2) An Initial Environmental Examination normally will not be 
necessary for activities within the classes described in Sec. 216.2(d), 
except when the originator of the project believes that the project will 
not have a significant effect on the environment. In such cases, the 
activity may be subjected to the procedures set forth in Sec. 216.3.
    (e) Pesticides. The exemptions of paragraph (b)(1) of this section 
and the categorical exclusions of paragraph (c)(2)

[[Page 755]]

of this section are not applicable to assistance for the procurement or 
use of pesticides.
[45 FR 70244, Oct. 23, 1980]



Sec. 216.3  Procedures.

    (a) General procedures--(1) Preparation of the Initial Environmental 
Examination. Except as otherwise provided, an Initial Environmental 
Examination is not required for activities identified in 
Sec. 216.2(b)(1), (c) (2), and (d). For all other A.I.D. activities 
described in Sec. 216.2(a) an Initial Environmental Examination will be 
prepared by the originator of an action. Except as indicated in this 
section, it should be prepared with the PID or PAIP. For projects 
including the procurement or use of pesticides, the procedures set forth 
in paragraph (b) of this section will be followed, in addition to the 
procedures in this paragraph. Activities which cannot be identified in 
sufficient detail to permit the completion of an Initial Environmental 
Examination with the PID or PAIP, shall be described by including with 
the PID or PAIP: (i) An explanation indicating why the Initial 
Environmental Examination cannot be completed; (ii) an estimate of the 
amount of time required to complete the Initial Environmental 
Examination; and (iii) a recommendation that a Threshold Decision be 
deferred until the Initial Environmental Examination is completed. The 
responsible Assistant Administrator will act on the request for deferral 
concurrently with action on the PID or PAIP and will designate a time 
for completion of the Initial Environmental Examination. In all 
instances, except as provided in paragraph (a)(7) of this section, this 
completion date will be in sufficient time to allow for the completion 
of an Environmental Assessment or Environmental Impact Statement, if 
required, before a final decision is made to provide A.I.D. funding for 
the action.
    (2) Threshold decision. (i) The Initial Environmental Examination 
will include a Threshold Decision made by the officer in the originating 
office who signs the PID or PAIP. If the Initial Environmental 
Examination is completed prior to or at the same time as the PID or 
PAIP, the Threshold Decision will be reviewed by the Bureau 
Environmental Officer concurrently with approval of the PID or PAIP. The 
Bureau Environmental Officer will either concur in the Threshold 
Decision or request reconsideration by the officer who made the 
Threshold Decision, stating the reasons for the request. Differences of 
opinion between these officers shall be submitted for resolution to the 
Assistant Administrator at the same time that the PID is submitted for 
approval.
    (ii) An Initial Environmental Examination, completed subsequent to 
approval of the PID or PAIP, will be forwarded immediately together with 
the Threshold Determination to the Bureau Environmental Officer for 
action as described in this section.
    (iii) A Positive Threshold Decision shall result from a finding that 
the proposed action will have a significant effect on the environment. 
An Environmental Impact Statement shall be prepared if required pursuant 
to Sec. 216.7. If an impact statement is not required, an Environmental 
Assessment will be prepared in accordance with Sec. 216.6. The cognizant 
Bureau or Office will record a Negative Determination if the proposed 
action will not have a significant effect on the environment.
    (3) Negative Declaration. The Assistant Administrator, or the 
Administrator in actions for which the approval of the Administrator is 
required for the authorization of financing, may make a Negative 
Declaration, in writing, that the Agency will not develop an 
Environmental Assessment or an Environmental Impact Statement regarding 
an action found to have a significant effect on the environment when (i) 
a substantial number of Environmental Assessments or Environmental 
Impact Statements relating to similar activities have been prepared in 
the past, if relevant to the proposed action, (ii) the Agency has 
previously prepared a programmatic Statement or Assessment covering the 
activity in question which has been considered in the development of 
such activity, or (iii) the Agency has developed design criteria for 
such an action which, if applied in the design of the action, will avoid 
a significant effect on the environment.

[[Page 756]]

    (4) Scope of Environmental Assessment or Impact Statement--(i) 
Procedure and Content. After a Positive Threshold Decision has been 
made, or a determination is made under the pesticide procedures set 
forth in paragraph (b) of this section that an Environmental Assessment 
or Environmental Impact Statement is required, the originator of the 
action shall commence the process of identifying the significant issues 
relating to the proposed action and of determining the scope of the 
issues to be addressed in the Environmental Assessment or Environmental 
Impact Statement. The originator of an action within the classes of 
actions described in Sec. 216.2(d) shall commence this scoping process 
as soon as practicable. Persons having expertise relevant to the 
environmental aspects of the proposed action shall also participate in 
this scoping process. (Participants may include but are not limited to 
representatives of host governments, public and private institutions, 
the A.I.D. Mission staff and contractors.) This process shall result in 
a written statement which shall include the following matters:
    (a) A determination of the scope and significance of issues to be 
analyzed in the Environmental Assessment or Impact Statement, including 
direct and indirect effects of the project on the environment.
    (b) Identification and elimination from detailed study of the issues 
that are not significant or have been covered by earlier environmental 
review, or approved design considerations, narrowing the discussion of 
these issues to a brief presentation of why they will not have a 
significant effect on the environment.
    (c) A description of (1) the timing of the preparation of 
environmental analyses, including phasing if appropriate, (2) variations 
required in the format of the Environmental Assessment, and (3) the 
tentative planning and decision making schedule; and
    (d) A description of how the analysis will be conducted and the 
disciplines that will participate in the analysis.
    (ii) These written statements shall be reviewed and approved by the 
Bureau Environmental Officer.
    (iii) Circulation of scoping statement. To assist in the preparation 
of an Environmental Assessment, the Bureau Environmental Office may 
circulate copies of the written statement, together with a request for 
written comments, within thirty days, to selected federal agencies if 
that Officer believes comments by such federal agencies will be useful 
in the preparation of an Environmental Assessment. Comments received 
from reviewing federal agencies will be considered in the preparation of 
the Environmental Assessment and in the formulation of the design and 
implementation of the project, and will, together with the scoping 
statement, will be included in the project file.
    (iv) Change in Threshold Decision. If it becomes evident that the 
action will not have a significant effect on the environment (i.e., will 
not cause significant harm to the environment), the Positive Threshold 
Decision may be withdrawn with the concurrence of the Bureau 
Environmental Officer. In the case of an action included in 
Sec. 216.2(d)(2), the request for withdrawal shall be made to the Bureau 
Environmental Officer.
    (5) Preparation of Environmental Assessments and Environmental 
Impact Statement. If the PID or PAIP is approved, and the Threshold 
Decision is positive, or the action is included in Sec. 216.2(d), the 
originator of the action will be responsible for the preparation of an 
Environmental Assessment or Environmental Impact Statement as required. 
Draft Environmental Impact Statements will be circulated for review and 
comment as part of the review of Project Papers and as outlined further 
in Sec. 216.7 of those procedures. Except as provided in paragraph 
(a)(7) of this section, final approval of the PP or PAAD and the method 
of implementation will include consideration of the Environmental 
Assessment of final Environmental Impact Statement.
    (6) Processing and review within A.I.D. (i) Initial Environmental 
Examinations, Environmental Assessments and final Environmental Impact 
Statements will be processed pursuant to standard A.I.D. procedures for 
project approval documents. Except as provided in paragraph (a)(7) of 
this section, Environmental Assessments and

[[Page 757]]

final Environmental Impact Statements will be reviewed as an integral 
part of the Project Paper or equivalent document. In addition to these 
procedures, Environmental Assessments will be reviewed and cleared by 
the Bureau Environmental Officer. They may also be reviewed by the 
Agency's Environmental Coordinator who will monitor the Environmental 
Assessment process.
    (ii) When project approval authority is delegated to field posts, 
Environmental Assessments shall be reviewed and cleared by the Bureau 
Environmental Officer prior to the approval of such actions.
    (iii) Draft and final Environmental Impact Statements will be 
reviewed and cleared by the Environmental Coordinator and the Office of 
the General Counsel.
    (7) Environmental review after authorization of financing. (i) 
Environmental review may be performed after authorization of a project, 
program or activity only with respect to subprojects or significant 
aspects of the project, program or activity that are unidentified at the 
time of authorization. Environmental review shall be completed prior to 
authorization for all subprojects and aspects of a project, program or 
activity that are identified.
    (ii) Environmental review should occur at the earliest time in 
design or implementation at which a meaningful review can be undertaken, 
but in no event later than when previously unidentified subprojects or 
aspects of projects, programs or activities are identified and planned. 
To the extent possible, adequate information to undertake deferred 
environmental review should be obtained before funds are obligated for 
unidentified subprojects or aspects of projects, programs or activities. 
(Funds may be obligated for the other aspects for which environmental 
review has been completed.) To avoid an irreversible commitment of 
resources prior to the conclusion of environmental review, the 
obligation of funds can be made incrementally as subprojects or aspects 
of projects, programs or activities are identified; or if necessary 
while planning continues, including environmental review, the agreement 
or other document obligating funds may contain appropriate convenants or 
conditions precedent to disbursement for unidentified subprojects or 
aspects of projects, programs or activities.
    (iii) When environmetal review must be deferred beyond the time some 
of the funds are to be disbursed (e.g. long lead times for the delivery 
of goods or services), the project agreement or other document 
obligating funds shall contain a covenant or covenants requiring 
environmental review, including an Environmental Assessment or 
Environmental Impact Statement, when appropriate, to be completed and 
taken into account prior to implementation of those subprojects or 
aspects of the project, program or activity for which environmental 
review is deferred. Such convenants shall ensure that implementation 
plans will be modified in accordance with environmental review if the 
parties decide that modifications are necessary.
    (iv) When environmental review will not be completed for an entire 
project, program or activity prior to authorization, the Initial 
Environmental Examination and Threshold Decision required under 
paragraphs (a)(1) and (2) of this section shall identify those aspects 
of the project, program or activity for which environmental review will 
be completed prior to the time financing is authorized. It shall also 
include those subprojects or aspects for which environmental review will 
be deferred, stating the reasons for deferral and the time when 
environmental review will be completed. Further, it shall state how an 
irreversible commitment of funds will be avoided until environmental 
review is completed. The A.I.D. officer responsible for making 
environmental decisions for such projects, programs or activities shall 
also be identified (the same officer who has decision making authority 
for the other aspects of implementation). This deferral shall be 
reviewed and approved by the officer making the Threshold Decision and 
the officer who authorizes the project, program or activity. Such 
approval may be made only after consultation with the Office of General 
Counsel for the purpose of establishing the manner in which conditions 
precedent to disbursement or covenants in

[[Page 758]]

project and other agreements will avoid an irreversible commitment of 
resources before environmental review is completed.
    (8) Monitoring. To the extent feasible and relevant, projects and 
programs for which Environmental Impact Statements or Environmental 
Assessments have been prepared should be designed to include measurement 
of any changes in environmental quality, positive or negative, during 
their implementation. This will require recording of baseline data at 
the start. To the extent that available data permit, originating offices 
of A.I.D. will formulate systems in collaboration with recipient 
nations, to monitor such impacts during the life of A.I.D.'s 
involvement. Monitoring implementation of projects, programs and 
activities shall take into account environmental impacts to the same 
extent as other aspects of such projects, programs and activities. If 
during implementation of any project, program or activity, whether or 
not an Environmental Assessment or Environmental Impact Statement was 
originally required, it appears to the Mission Director, or officer 
responsible for the project, program or activity, that it is having or 
will have a significant effect on the environment that was not 
previously studied in an Environmental Assessment or Environmental 
Impact Statement, the procedures contained in this part shall be 
followed including, as appropriate, a Threshold Decision, Scoping and an 
Environmental Assessment or Environmental Impact Statement.
    (9) Revisions. If, after a Threshold Decision is made resulting in a 
Negative Determination, a project is revised or new information becomes 
available which indicates that a proposed action might be ``major'' and 
its effects ``significant'', the Negative Determination will be reviewed 
and revised by the cognizant Bureau and an Environmental Assessment or 
Environmental Impact Statement will be prepared, if appropriate. 
Environmental Assessments and Environmental Impact Statements will be 
amended and processed appropriately if there are major changes in the 
project or program, or if significant new information becomes available 
which relates to the impact of the project, program or activity on the 
environment that was not considered at the time the Environmental 
Assessment or Environmental Impact Statement was approved. When on-going 
programs are revised to incorporate a change in scope or nature, a 
determination will be made as to whether such change may have an 
environmental impact not previously assessed. If so, the procedures 
outlined in this part will be followed.
    (10) Other approval documents. These procedures refer to certain 
A.I.D. documents such as PIDs, PAIPs, PPs and PAADs as the A.I.D. 
internal instruments for approval of projects, programs or activities. 
From time to time, certain special procedures, such as those in 
Sec. 216.4, may not require the use of the aforementioned documents. In 
these situations, these environmental procedures shall apply to those 
special approval procedures, unless otherwise exempt, at approval times 
and levels comparable to projects, programs and activities in which the 
aforementioned documents are used.
    (b) Pesticide procedures--(1) Project Assistance. Except as provided 
in paragraph (b)(2) of this section, all proposed projects involving 
assistance for the procurement or use, or both, of pesticides shall be 
subject to the procedures prescribed in paragraphs (b)(1) (i) through 
(v) of this section. These procedures shall also apply, to the extent 
permitted by agreements entered into by A.I.D. before the effective date 
of these pesticide procedures, to such projects that have been 
authorized but for which pesticides have not been procured as of the 
effective date of these pesticide procedures.
    (i) When a project includes assistance for procurement or use, or 
both, of pesticides registered for the same or similar uses by USEPA 
without restriction, the Initial Environmental Examination for the 
project shall include a separate section evaluating the economic, social 
and environmental risks and benefits of the planned pesticide use to 
determine whether the use may result in significant environmental 
impact. Factors to be considered in such an evaluation shall include, 
but not be limited to the following:

[[Page 759]]

    (a) The USEPA registration status of the requested pesticide;
    (b) The basis for selection of the requested pesticide;
    (c) The extent to which the proposed pesticide use is part of an 
integrated pest management program;
    (d) The proposed method or methods of application, including 
availability of appropriate application and safety equipment;
    (e) Any acute and long-term toxicological hazards, either human or 
environmental, associated with the proposed use and measures available 
to minimize such hazards;
    (f) The effectiveness of the requested pesticide for the proposed 
use;
    (g) Compatibility of the proposed pesticide with target and 
nontarget ecosystems;
    (h) The conditions under which the pesticide is to be used, 
including climate, flora, fauna, geography, hydrology, and soils;
    (i) The availability and effectiveness of other pesticides or 
nonchemical control methods;
    (j) The requesting country's ability to regulate or control the 
distribution, storage, use and disposal of the requested pesticide;
    (k) The provisions made for training of users and applicators; and
    (l) The provisions made for monitoring the use and effectiveness of 
the pesticide.

In those cases where the evaluation of the proposed pesticide use in the 
Initial Environmental Examination indicates that the use will 
significantly effect the human environment, the Threshold Decision will 
include a recommendation for the preparation of an Environmental 
Assessment or Environmental Impact Statement, as appropriate. In the 
event a decision is made to approve the planned pesticide use, the 
Project Paper shall include to the extent practicable, provisions 
designed to mitigate potential adverse effects of the pesticide. When 
the pesticide evaluation section of the Initial Environmental 
Examination does not indicate a potentially unreasonable risk arising 
from the pesticide use, an Environmental Assessment or Environmental 
Impact Statement shall nevertheless be prepared if the environmental 
effects of the project otherwise require further assessment.
    (ii) When a project includes assistance for the procurement or use, 
or both, of any pesticide registered for the same or similar uses in the 
United States but the proposed use is restricted by the USEPA on the 
basis of user hazard, the procedures set forth in paragraph (b)(1)(i) of 
this section will be followed. In addition, the Initial Environmental 
Examination will include an evaluation of the user hazards associated 
with the proposed USEPA restricted uses to ensure that the 
implementation plan which is contained in the Project Paper incorporates 
provisions for making the recipient government aware of these risks and 
providing, if necessary, such technical assistance as may be required to 
mitigate these risks. If the proposed pesticide use is also restricted 
on a basis other than user hazard, the procedures in paragraph 
(b)(1)(iii) of this section shall be followed in lieu of the procedures 
in this section.
    (iii) If the project includes assistance for the procurement or use, 
or both of:
    (a) Any pesticide other than one registered for the same or similar 
uses by USEPA without restriction or for restricted use on the basis of 
user hazard; or
    (b) Any pesticide for which a notice of rebuttable presumption 
against re- registration, notice of intent to cancel, or notice of 
intent to suspend has been issued by USEPA.

The Threshold Decision will provide for the preparation of an 
Environmental Assessment or Environmental Impact Statement, as 
appropriate (Sec. 216.6(a)). The EA or EIS shall include, but not be 
limited to, an analysis of the factors identified in paragraph (b)(1)(i) 
of this section.
    (iv) Notwithstanding the provisions of paragraphs (b)(1) (i) through 
(iii) of this section, if the project includes assistance for the 
procurement or use, or both, of a pesticide against which USEPA has 
initiated a regulatory action for cause, or for which it has issued a 
notice of rebuttable presumption against reregistration, the nature of 
the action or notice, including the

[[Page 760]]

relevant technical and scientific factors will be discussed with the 
requesting government and considered in the IEE and, if prepared, in the 
EA or EIS. If USEPA initiates any of the regulatory actions above 
against a pesticide subsequent to its evaluation in an IEE, EA or EIS, 
the nature of the action will be discussed with the recipient government 
and considered in an amended IEE or amended EA or EIS, as appropriate.
    (v) If the project includes assistance for the procurement or use, 
or both of pesticides but the specific pesticides to be procured or used 
cannot be identified at the time the IEE is prepared, the procedures 
outlined in paragraphs (b) (i) through (iv) of this section will be 
followed when the specific pesticides are identified and before 
procurement or use is authorized. Where identification of the pesticides 
to be procured or used does not occur until after Project Paper 
approval, neither the procurement nor the use of the pesticides shall be 
undertaken unless approved, in writing, by the Assistant Administrator 
(or in the case of projects authorized at the Mission level, the Mission 
Director) who approved the Project Paper.
    (2) Exceptions to pesticide procedures. The procedures set forth in 
paragraph (b)(1) of this section shall not apply to the following 
projects including assistance for the procurement or use, or both, of 
pesticides.
    (i) Projects under emergency conditions.

Emergency conditions shall be deemed to exist when it is determined by 
the Administrator, A.I.D., in writing that:
    (a) A pest outbreak has occurred or is imminent; and
    (b) Significant health problems (either human or animal) or 
significant economic problems will occur without the prompt use of the 
proposed pesticide; and
    (c) Insufficient time is available before the pesticide must be used 
to evaluate the proposed use in accordance with the provisions of this 
regulation.
    (ii) Projects where A.I.D. is a minor donor, as defined in 
Sec. 216.1(c)(12) of this part, to a multi-donor project.
    (iii) Projects including assistance for procurement or use, or both, 
of pesticides for research or limited field evaluation purposes by or 
under the supervision of project personnel. In such instances, however, 
A.I.D. will ensure that the manufacturers of the pesticides provide 
toxicological and environmental data necessary to safeguard the health 
or research personnel and the quality of the local environment in which 
the pesticides will be used. Furthermore, treated crops will not be used 
for human or animal consumption unless appropriate tolerances have been 
established by EPA or recommended by FAO/WHO, and the rates and 
frequency of application, together with the prescribed preharvest 
intervals, do not result in residues exceeding such tolerances. This 
prohibition does not apply to the feeding of such crops to animals for 
research purposes.
    (3) Non-project assistance. In a very few limited number of 
circumstances A.I.D. may provide non-project assistance for the 
procurement and use of pesticides. Assistance in such cases shall be 
provided if the A.I.D. Administrator determines in writing that (i) 
emergency conditions, as defined in paragraph (b)(2)(i) of this section 
exists; or (ii) that compelling circumstances exist such that failure to 
provide the proposed assistance would seriously impede the attainment of 
U.S. foreign policy objectives or the objectives of the foreign 
assistance program. In the latter case, a decision to provide the 
assistance will be based to the maximum extent practicable, upon a 
consideration of the factors set forth in paragraph (b)(1)(i) of this 
section and, to the extent available, the history of efficacy and safety 
covering the past use of the pesticide the in recipient country.
[43 FR 20491, May 12, 1978, as amended at 45 FR 70245, Oct. 23, 1980]



Sec. 216.4  Private applicants.

    Programs, projects or activities for which financing from A.I.D. is 
sought by private applicants, such as PVOs and educational and research 
institutions, are subject to these procedures. Except as provided in 
Sec. 216.2 (b), (c) or (d), preliminary proposals for financing 
submitted by private applicants shall

[[Page 761]]

be accompanied by an Initial Environmental Examination or adequate 
information to permit preparation of an Initial Environmental 
Examination. The Threshold Decision shall be made by the Mission 
Director for the country to which the proposal relates, if the 
preliminary proposal is submitted to the A.I.D. Mission, or shall be 
made by the officer in A.I.D. who approves the preliminary proposal. In 
either case, the concurrence of the Bureau Environmental Officer is 
required in the same manner as in Sec. 216.3(a)(2), except for PVO 
projects approved in A.I.D. Missions with total life of project costs 
less than $500,000. Thereafter, the same procedures set forth in 
Sec. 216.3 including as appropriate scoping and Environmental 
Assessments or Environmental Impact Statements, shall be applicable to 
programs, projects or activities submitted by private applicants. The 
final proposal submitted for financing shall be treated, for purposes of 
these procedures, as a Project Paper. The Bureau Environmental Officer 
shall advise private applicants of studies or other information 
foreseeably required for action by A.I.D.
[45 FR 70247, Oct. 23, 1980]



Sec. 216.5  Endangered species.

    It is A.I.D. policy to conduct its assistance programs in a manner 
that is sensitive to the protection of endangered or threatened species 
and their critical habitats. The Initial Environmental Examination for 
each project, program or activity having an effect on the environment 
shall specifically determine whether the project, program or activity 
will have an effect on an endangered or threatened species, or critical 
habitat. If the proposed project, program or activity will have the 
effect of jeopardizing an endangered or threatened species or of 
adversely modifying its critical habitat, the Threshold Decision shall 
be a Positive Determination and an Environmental Assessment or 
Environmental Impact Statement completed as appropriate, which shall 
discuss alternatives or modifications to avoid or mitigate such impact 
on the species or its habitat.
[45 FR 70247, Oct. 23, 1980]



Sec. 216.6  Environmental assessments.

    (a) General purpose. The purpose of the Environmental Assessment is 
to provide Agency and host country decision makers with a full 
discussion of significant environmental effects of a proposed action. It 
includes alternatives which would avoid or minimize adverse effects or 
enhance the quality of the environment so that the expected benefits of 
development objectives can be weighed against any adverse impacts upon 
the human environment or any irreversible or irretrievable commitment of 
resources.
    (b) Collaboration with affected nation on preparation. Collaboration 
in obtaining data, conducting analyses and considering alternatives will 
help build an awareness of development associated environmental problems 
in less developed countries as well as assist in building an indigenous 
institutional capability to deal nationally with such problems. 
Missions, Bureaus and Offices will collaborate with affected countries 
to the maximum extent possible, in the development of any Environmental 
Assessments and consideration of environmental consequences as set forth 
therein.
    (c) Content and form. The Environmental Assessment shall be based 
upon the scoping statement and shall address the following elements, as 
appropriate:
    (1) Summary. The summary shall stress the major conclusions, areas 
of controversy, if any, and the issues to be resolved.
    (2) Purpose. The Environmental Assessment shall briefly specify the 
underlying purpose and need to which the Agency is responding in 
proposing the alternatives including the proposed action.
    (3) Alternatives including the proposed action. This section should 
present the environmental impacts of the proposal and its alternatives 
in comparative form, thereby sharpening the issues and providing a clear 
basis for choice among options by the decision maker. This section 
should explore and evaluate reasonable alternatives and briefly discuss 
the reasons for eliminating those alternatives which were not included 
in the detailed study; devote

[[Page 762]]

substantial treatment to each alternative considered in detail including 
the proposed action so that reviewers may evaluate their comparative 
merits; include the alternative of no action; identify the Agency's 
preferred alternative or alternatives, if one or more exists; include 
appropriate mitigation measures not already included in the proposed 
action or alternatives.
    (4) Affected environment. The Environmental Assessment shall 
succinctly describe the environment of the area(s) to be affected or 
created by the alternatives under consideration. The descriptions shall 
be no longer than is necessary to understand the effects of the 
alternatives. Data and analyses in the Environmental Assessment shall be 
commensurate with the significance of the impact with less important 
material summarized, consolidated or simply referenced.
    (5) Environmental consequences. This section forms the analytic 
basis for the comparisons under paragraph (c)(3) of this section. It 
will include the environmental impacts of the alternatives including the 
proposed action; any adverse effects that cannot be avoided should the 
proposed action be implemented; the relationship between short-term uses 
of the environment and the maintenance and enhancement of long-term 
productivity; and any irreversible or irretrievable commitments of 
resources which would be involved in the proposal should it be 
implemented. It should not duplicate discussions in paragraph (c)(3) of 
this section. This section of the Environmental Assessment should 
include discussions of direct effects and their significance; indirect 
effects and their significance; possible conflicts between the proposed 
action and land use plans, policies and controls for the areas 
concerned; energy requirements and conservation potential of various 
alternatives and mitigation measures; natural or depletable resource 
requirements and conservation potential of various requirements and 
mitigation measures; urban quality; historic and cultural resources and 
the design of the built environment, including the reuse and 
conservation potential of various alternatives and mitigation measures; 
and means to mitigate adverse environmental impacts.
    (6) List of preparers. The Environmental Assessment shall list the 
names and qualifications (expertise, experience, professional 
discipline) of the persons primarily responsible for preparing the 
Environmental Assessment or significant background papers.
    (7) Appendix. An appendix may be prepared.
    (d) Program assessment. Program Assessments may be appropriate in 
order to assess the environmental effects of a number of individual 
actions and their cumulative environmental impact in a given country or 
geographic area, or the environmental impacts that are generic or common 
to a class of agency actions, or other activities which are not country-
specific. In these cases, a single, programmatic assessment will be 
prepared in A.I.D./Washington and circulated to appropriate overseas 
Missions, host governments, and to interested parties within the United 
States. To the extent practicable, the form and content of the 
programmatic Environmental Assessment will be the same as for project 
Assessments. Subsequent Environmental Assessments on major individual 
actions will only be necessary where such follow-on or subsequent 
activities may have significant environmental impacts on specific 
countries where such impacts have not been adequately evaluated in the 
programmatic Environmental Assessment. Other programmatic evaluations of 
classes of actions may be conducted in an effort to establish additional 
categorical exclusions or design standards or criteria for such classes 
that will eliminate or minimize adverse effects of such actions, enhance 
the environmental effect of such action or reduce the amount of 
paperwork or time involved in these procedures. Programmatic evaluations 
conducted for the purpose of establishing additional categorical 
exclusions under Sec. 216.2(c) or design considerations that will 
eliminate significant effects for classes of actions shall be made 
available for public comment before the categorical exclusions or design 
standards or criteria are adopted by A.I.D. Notice of the availability 
of such document shall be published in the Federal Register.

[[Page 763]]

Additional categorical exclusions shall be adopted by A.I.D. upon the 
approval of the Administrator, and design consideration in accordance 
with usual agency procedures.
    (e) Consultation and review. (1) When Environmental Assessments are 
prepared on activities carried out within or focused on specific 
developing countries, consultation will be held between A.I.D. staff and 
the host government both in the early stages of preparation and on the 
results and significance of the completed Assessment before the project 
is authorized.
    (2) Missions will encourage the host government to make the 
Environmental Assessment available to the general public of the 
recipient country. If Environmental Assessments are prepared on 
activities which are not country-specific, the Assessment will be 
circulated by the Environmental Coordinator to A.I.D.'s Overseas 
Missions and interested governments for information, guidance and 
comment and will be made available in the U.S. to interested parties.
    (f) Effect in other countries. In a situation where an analysis 
indicates that potential effects may extend beyond the national 
boundaries of a recipient country and adjacent foreign nations may be 
affected, A.I.D. will urge the recipient country to consult with such 
countries in advance of project approval and to negotiate mutually 
acceptable accommodations.
    (g) Classified material. Environmental Assessments will not normally 
include classified or administratively controlled material. However, 
there may be situations where environmental aspects cannot be adequately 
discussed without the inclusion of such material. The handling and 
disclosure of classified or administratively controlled material shall 
be governed by 22 CFR part 9. Those portions of an Environmental 
Assessment which are not classified or administratively controlled will 
be made available to persons outside the Agency as provided for in 22 
CFR part 212.
[45 FR 70247, Oct. 23, 1980]



Sec. 216.7  Environmental impact statements.

    (a) Applicability. An Environmental Impact Statement shall be 
prepared when agency actions significantly affect:
    (1) The global environment or areas outside the jurisdiction of any 
nation (e.g., the oceans);
    (2) The environment of the United States; or
    (3) Other aspects of the environment at the discretion of the 
Administrator.
    (b) Effects on the United States: Content and form. An Environmental 
Impact Statement relating to paragraph (a)(2) of this section shall 
comply with the CEQ Regulations. With respect to effects on the United 
States, the terms environment and significant effect wherever used in 
these procedures have the same meaning as in the CEQ Regulations rather 
than as defined in Sec. 216.1(c) (12) and (13) of these procedures.
    (c) Other effects: Content and form. An Environmental Impact 
Statement relating to paragraphs (a)(1) and (a)(3) of this section will 
generally follow the CEQ Regulations, but will take into account the 
special considerations and concerns of A.I.D. Circulation of such 
Environmental Impact Statements in draft form will precede approval of a 
Project Paper or equivalent and comments from such circulation will be 
considered before final project authorization as outlined in Sec. 216.3 
of these procedures. The draft Environmental Impact Statement will also 
be circulated by the Missions to affected foreign governments for 
information and comment. Draft Environmental Impact Statements generally 
will be made available for comment to Federal agencies with jurisdiction 
by law or special expertise with respect to any environmental impact 
involved, and to public and private organizations and individuals for 
not less than forty-five (45) days. Notice of availability of the draft 
Environmental Impact Statements will be published in the Federal 
Register. Cognizant Bureaus and Offices will submit these drafts for 
circulation through the Environmental Coordinator who will have the 
responsibility for coordinating all such communications

[[Page 764]]

with persons outside A.I.D. Any comments received by the Environmental 
Coordinator will be forwarded to the originating Bureau or Office for 
consideration in final policy decisions and the preparation of a final 
Environmental Impact Statement. All such comments will be attached to 
the final Statement, and those relevant comments not adequately 
discussed in the draft Environmental Impact Statement will be 
appropriately dealt with in the final Environmental Impact Statement. 
Copies of the final Environmental Impact Statement, with comments 
attached, will be sent by the Environmental Coordinator to CEQ and to 
all other Federal, state, and local agencies and private organizations 
that made substantive comments on the draft, including affected foreign 
governments. Where emergency circumstances or considerations of foreign 
policy make it necessary to take an action without observing the 
provisions of Sec. 1506.10 of the CEQ Regulations, or when there are 
overriding considerations of expense to the United States or foreign 
governments, the originating Office will advise the Environmental 
Coordinator who will consult with Department of State and CEQ concerning 
appropriate modification of review procedures.
[45 FR 70249, Oct. 23, 1980]



Sec. 216.8  Public hearings.

    (a) In most instances AID will be able to gain the benefit of public 
participation in the impact statement process through circulation of 
draft statements and notice of public availability in CEQ publications. 
However, in some cases the Administrator may wish to hold public 
hearings on draft Environmental Impact Statements. In deciding whether 
or not a public hearing is appropriate, Bureaus in conjunction with the 
Environmental Coordinator should consider:
    (1) The magnitude of the proposal in terms of economic costs, the 
geographic area involved, and the uniqueness or size of commitment of 
the resources involved;
    (2) The degree of interest in the proposal as evidenced by requests 
from the public and from Federal, state and local authorities, and 
private organizations and individuals, that a hearing be held;
    (3) The complexity of the issue and likelihood that information will 
be presented at the hearing which will be of assistance to the Agency; 
and
    (4) The extent to which public involvement already has been achieved 
through other means, such as earlier public hearings, meetings with 
citizen representatives, and/or written comments on the proposed action.
    (b) If public hearings are held, draft Environmental Impact 
Statements to be discussed should be made available to the public at 
least fifteen (15) days prior to the time of the public hearings, and a 
notice will be placed in the Federal Register giving the subject, time 
and place of the proposed hearings.
[41 FR 26913, June 30, 1976. Redesignated at 45 FR 70249, Oct. 23, 1980]



Sec. 216.9  Bilateral and multilateral studies and concise reviews of environmental issues.

    Notwithstanding anything to the contrary in these procedures, the 
Administrator may approve the use of either of the following documents 
as a substitute for an Environmental Assessment (but not a substitute 
for an Environmental Impact Statement) required under these procedures:
    (a) Bilateral or multilateral environmental studies, relevant or 
related to the proposed action, prepared by the United States and one or 
more foreign countries or by an international body or organization in 
which the United States is a member or participant; or
    (b) Concise reviews of the environmental issues involved including 
summary environmental analyses or other appropriate documents.
[45 FR 70249, Oct. 23, 1980]



Sec. 216.10  Records and reports.

    Each Agency Bureau will maintain a current list of activities for 
which Environmental Assessments and Environmental Impact Statements are 
being prepared and for which Negative Determinations and Declarations 
have been

[[Page 765]]

made. Copies of final Initial Environmental Examinations, scoping 
statements, Assessments and Impact Statements will be available to 
interested Federal agencies upon request. The cognizant Bureau will 
maintain a permanent file (which may be part of its normal project 
files) of Environmental Impact Statements, Environmental Assessments, 
final Initial Environmental Examinations, scoping statements, 
Determinations and Declarations which will be available to the public 
under the Freedom of Information Act. Interested persons can obtain 
information or status reports regarding Environmental Assessments and 
Environmental Impact Statements through the A.I.D. Environmental 
Coordinator.
[45 FR 70249, Oct. 23, 1980]



PART 217--NONDISCRIMINATING ON THE BASIS OF HANDICAP IN PROGRAMS AND ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE--Table of Contents




                      Subpart A--General Provisions

Sec.
217.1  Purpose.
217.2  Application.
217.3  Definitions.
217.4  Discrimination prohibited.
217.5  Assurances required.
217.6  Remedial action, voluntary action, and self-evaluation.
217.7  Designation of responsible employee and adoption of grievance 
          procedures.
217.8  Notice.
217.9  Administrative requirements for small recipients.
217.10  Effect of state or local law or other requirements and effect of 
          employment opportunities.

                     Subpart B--Employment Practices

217.11  Discrimination prohibited.
217.12  Reasonable accommodation.
217.13  Employment criteria.
217.14  Preemployment inquiries.
217.15--217.20  [Reserved]

                    Subpart C--Program Accessibility

217.21  Discrimination prohibited.
217.22  Existing facilities.
217.23  New construction.
217.24--217.40  [Reserved]

                   Subpart D--Postsecondary Education

217.41  Application of this subpart.
217.42  Admissions and recruitment.
217.43  Treatment of students; general.
217.44  Academic adjustments.
217.45  Housing.
217.46  Financial and employment assistance to students.
217.47  Nonacademic services.
217.48--217.60  [Reserved]

                          Subpart E--Procedures

217.61  Procedures.
217.62--217.99  [Reserved]

Appendix A to Part 217--Federal Financial Assistance to Which These 
          Regulations Apply

    Authority:  29 U.S.C. 794, unless otherwise noted.

    Source:  45 FR 66415, Oct. 6, 1980, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 217.1  Purpose.

    The purpose of this part is to effectuate section 504 of the 
Rehabilitation Act of 1973, which is designed to eliminate 
discrimination on the basis of handicap in any program or activity 
within the United States receiving Federal financial assistance.



Sec. 217.2  Application.

    This part applies to all programs carried on within the United 
States by recipients of Federal financial assistance pursuant to any 
authority held or delegated by the Administrator of the Agency for 
International Development, including the federally-assisted programs and 
activities listed in appendix A of this part. (appendix A may be revised 
from time to time by notice in the Federal Register). It applies to 
money paid, property transferred, or other Federal financial assistance 
extended under any such program after the effective date of this 
regulation, even if the application for such assistance is approved 
prior to such effective date. This part does not apply to (a) any 
Federal financial assistance by way of insurance or guaranty contracts, 
(b) money paid, property transferred or other assistance extended

[[Page 766]]

under any such program before the effective date of this part, (c) any 
assistance to any individual who is the ultimate beneficiary under any 
such program, and (d) any procurement of goods or services, including 
the procurement of training. This part does not bar selection and 
treatment reasonably related to the foreign assistance objective or such 
other authorized purpose as the Federal assistance may have. It does not 
bar selections which are limited to particular groups where the purpose 
of the program calls for such a limitation nor does it bar special 
treatment including special courses of training, orientation or 
counseling consistent with such purpose.



Sec. 217.3  Definitions.

    As used in this part, the term:
    (a) The Act means the Rehabilitation Act of 1973, Pub. L. 93-112, as 
amended by the Rehabilitation Comprehensive Services and Developmental 
Disabilities Amendments of 1979, Pub. L. 95-602.
    (b) Section 504 means section 504 of the Act.
    (c) Agency means the Agency for International Development.
    (d) The term Administrator means the Administrator of the Agency for 
International Development or any person specifically designated by him 
to perform any function provided for under this part.
    (e) Recipient means any state or its political subdivision, any 
instrumentality of a state or its political subdivision, any public or 
private agency, institution, organization, or other entity, or any 
person to which Federal financial assistance is extended directly or 
through another recipient, including any successor, assignee, or 
transferee of a recipient, but excluding the ultimate beneficiary of the 
assistance and any sovereign foreign government.
    (f) Applicant for assistance means one who submits an application, 
request, or plan required to be approved by an Agency official or by a 
recipient as a condition to becoming a recipient.
    (g) Federal financial assistance means any grant, loan, contract 
(other than a procurement contract or a contract of insurance or 
guaranty), or any other arrangement by which the Agency provides or 
otherwise makes available assistance in the form of:
    (1) Funds;
    (2) Services of Federal personnel; or
    (3) Real and personal property or any interest in or use of such 
property, including:
    (i) Transfers or leases of such property for less than the fair 
market value or for reduced consideration; and
    (ii) Proceeds from a subsequent transfer or lease of such property 
if the Federal share of its fair market value is not returned to the 
Federal Government.
    (h) Facility means all or any portion of buildings, structures, 
equipment, roads, walks, parking lots, or other real or personal 
property or interest in such property.
    (i) Handicapped person. (1) ``Handicapped persons'' means any person 
who (i) has a physical or mental impairment which substantially limits 
one or more major life activities, (ii) has a record of such an 
impairment, or (iii) is regarded as having such an impairment.
    (2) As used in paragraph (i)(1) of this section the phrase:
    (i) Physical or mental impairment includes but is not limited to 
such diseases and conditions as orthopedic, visual, speech and hearing 
impairments, cerebral palsy, epilepsy, muscular dystrophy, multiple 
sclerosis, cancer, heart disease, diabetes, mental retardation, 
emotional illness, and drug addiction and alcoholism. Such term does not 
include alcoholism or drug abuse, where by reason of such condition the 
individual is prevented from performing the duties of the job in 
question or whose employment, by reason of such current alcohol or drug 
abuse, would constitute a direct threat to property or the safety of 
others.
    (ii) Major life activities means functions such as caring for one's 
self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (iii) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more major life activities.

[[Page 767]]

    (iv) Is regarded as having an impairment means (A) has a physical or 
mental impairment that does not substantially limit major life 
activities but that is treated by a recipient as constituting such a 
limitation; (B) has a physical or mental impairment that substantially 
limits major life activities only as a result of the attitudes of others 
towards such impairment; or (C) has none of the impairments defined in 
paragraph (i)(2)(i) of this section but is treated by a recipient as 
having such an impairment.
    (j) Qualified handicapped person means:
    (1) With respect to employment, a handicapped person who, with or 
without reasonable accommodation, can perform the essential functions of 
the job in question;
    (2) With respect to postsecondary and vocational education services, 
a handicapped person who meets the academic and technical standards 
requisite to admission or participation in the recipient's education 
program or activity;
    (3) With respect to other services, a handicapped person who meets 
the essential eligibility requirements for the receipt of such services.
    (k) Handicap means any condition or characteristic that renders a 
person a handicapped person as defined in paragraph (j) of this section.



Sec. 217.4  Discrimination prohibited.

    (a) General. No qualified handicapped person shall, on the basis of 
handicap, be excluded from participation in, be denied the benefits of, 
or otherwise be subjected to discrimination under any program or 
activity which receives or benefits from Federal financial assistance.
    (b) Discriminatory actions prohibited. (1) A recipient, in providing 
any aid, benefit, or service, may not, directly or through contractual, 
licensing, or other arrangements, on the basis of handicap:
    (i) Deny a qualified handicapped person the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualified handicapped person an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified handicapped person with an aid, benefit, 
or service that is not as effective as that provided to others;
    (iv) Provide different or separate aid, benefits, or services to 
handicapped persons or to any class of handicapped persons unless such 
action is necessary to provide qualified handicapped persons with aid, 
benefits, or services that are as effective as those provided to others;
    (v) Aid or perpetuate discrimination against a qualified handicapped 
person by providing significant assistance to an agency, organization, 
or person that discriminates on the basis of handicap in providing any 
aid, benefits, or service to beneficiaries of the recipient's program;
    (vi) Deny a qualified handicapped person the opportunity to 
participate as a member of planning or advisory boards; or
    (vii) Otherwise limit a qualified handicapped person in the 
enjoyment of any right, privilege, advantage, or opportunity enjoyed by 
others receiving an aid, benefit, or service.
    (2) For purposes of this part, aids, benefits, and services, to be 
equally effective, are not required to produce the identical result or 
level of achievement for handicapped and nonhandicapped persons, but 
must afford handicapped persons equal opportunity to obtain the same 
result, to gain the same benefit, or to reach the same level of 
achievement, in the most integrated setting appropriate to the person's 
needs.
    (3) Despite the existence of separate or different programs or 
activities provided in accordance with this part, a recipient may not 
deny a qualified handicapped person the opportunity to participate in 
such programs or activities that are not separate or different.
    (4) A recipient may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration (i) that 
have the effect of subjecting qualified handicapped persons to 
discrimination on the basis of handicap, (ii) that have the purpose or 
effect of defeating or substantially

[[Page 768]]

impairing accomplishment of the objectives of the recipient's program 
with respect to handicapped persons, or (iii) that perpetuate the 
discrimination of another recipient if both recipients are subject to 
common administrative control or are agencies of the same State.
    (5) In determining the site or location of a facility, an applicant 
for assistance or a recipient may not make selections (i) that have the 
effect of excluding handicapped persons from, denying them the benefits 
of, or otherwise subjecting them to discrimination under any program or 
activity that receives or benefits from Federal financial assistance or 
(ii) that have the purpose or effect of defeating or substantially 
impairing the accomplishment of the objectives of the program or 
activity with respect to handicapped persons.
    (6) As used in this section, the aid, benefit, or service provided 
under a program or activity receiving or benefiting from Federal 
financial assistance includes any aid, benefit, or service provided in 
or through a facility that has been constructed, expanded, altered, 
leased or rented, or otherwise acquired, in whole or in part, with 
Federal financial assistance.
    (c) Programs limited by Federal law. The exclusion of nonhandicapped 
persons from the benefits of a program limited by Federal statute or 
executive order to handicapped persons or the exclusion of a specific 
class of handicapped persons from a program limited by Federal statute 
or executive order to a different class of handicapped persons is not 
prohibited by this part.



Sec. 217.5  Assurances required.

    (a) Assurances. An applicant for Federal financial assistance for a 
program or activity to which this part applies shall submit an 
assurance, on a form specified by the Administrator, that the program 
will be operated in compliance with this part. An applicant may 
incorporate these assurances by reference in subsequent applications to 
the Agency.
    (b) Duration of obligation. (1) In the case of Federal financial 
assistance extended in the form of real property or to provide real 
property or structures on the property, the assurance will obligate the 
recipient or, in the case of a subsequent transfer, the transferee, for 
the period during which the real property or structures are used for the 
purpose for which Federal financial assistance is extended or for 
another purpose involving the provision of similar services or benefits.
    (2) In the case of Federal financial assistance extended to provide 
personal property, the assurance will obligate the recipient for the 
period during which it retains ownership or possession of the property.
    (3) In all other cases the assurance will obligate the recipient for 
the period during which Federal financial assistance is extended.
    (c) Covenants. (1) Where Federal financial assistance is provided in 
the form of real property or interest in the property from the Agency 
the instrument effecting or recording this transfer shall contain a 
covenant running with the land to assure nondiscrimination for the 
period during which the real property is used for a purpose involving 
the provision of similar services or benefits.
    (2) Where no transfer of property is involved but property is 
purchased or improved with Federal financial assistance, the recipient 
shall agree to include the covenant described in paragraph (c)(1) of 
this section in the instrument effecting or recording any subsequent 
transfer of the property.
    (3) Where Federal financial assistance is provided in the form of 
real property or interest in the property from the Agency the covenant 
shall also include a condition coupled with a right to be reserved by 
the Agency to revert title to the property in the event of a breach of 
the covenant. If a transferee of real property proposes to mortgage or 
otherwise encumber the real property as security for financing 
construction of new, or improvement of existing, facilities on the 
property for the purposes for which the property was transferred, the 
Administrator may, upon request of the transferee and if necessary to 
accomplish such financing and upon such conditions as he or she deems 
appropriate, agree to forbear the exercise of such right to revert title 
for so long as the lien of such

[[Page 769]]

mortgage or other encumbrance remains effective.



Sec. 217.6  Remedial action, voluntary action, and self-evaluation.

    (a) Remedial action. (1) If the Administrator finds that a recipient 
has discriminated against persons on the basis of handicap in violation 
of section 504 or this part, the recipient shall take such remedial 
action as the Administrator deems necessary to overcome the effects of 
the discrimination.
    (2) Where a recipient is found to have discriminated against persons 
on the basis of handicap in violation of section 504 or this part and 
where another recipient exercises control over the recipient that has 
discriminated, the Administrator, where appropriate, may require either 
or both recipients to take remedial action.
    (3) The Administrator may, where necessary to overcome the effects 
of discrimination in violation of section 504 or this part, require a 
recipient to take remedial action (i) with respect to handicapped 
persons who are no longer participants in the recipient's program but 
who were participants in the program when such discrimination occurred 
or (ii) with respect to handicapped persons presently in the program but 
not receiving full benefits or equal and integrated treatment within the 
program or (iii) with respect to handicapped persons who would have been 
participants in the program had the discrimination not occurred.
    (b) Voluntary action. A recipient may take steps, in addition to any 
action that is required by this part, to overcome the effect of 
conditions that resulted in limited participation in the recipient's 
program or activity by qualified handicapped persons.
    (c) Self-evaluation. (1) A recipient shall, within one year of the 
effective date of this part:
    (i) Evaluate with the assistance of interested persons or 
organizations representing handicapped persons, its current policies and 
practices and the effects thereof that do not or may not meet the 
requirements of this part;
    (ii) Modify, after consultation with interested persons, including 
handicapped persons or organizations representing handicapped persons, 
any policies and practices that do not meet the requirement of this 
part; and
    (iii) Take, after consultation with interested persons, including 
handicapped persons or organizations representing handicapped persons, 
appropriate remedial steps to eliminate the effects of any 
discrimination that resulted from adherence to these policies and 
practices.
    (2) A recipient that employs fifteen or more persons shall, for at 
least three years following completion of the evaluation required under 
paragraph (c)(1) of this section, maintain on file, make available for 
public inspection, and provide to the Administrator upon request: (i) A 
list of the interested persons consulted, (ii) a description of areas 
examined and any problems identified, and (iii) a description of any 
modifications made and of any remedial steps taken.



Sec. 217.7  Designation of responsible employee and adoption of grievance procedures.

    (a) Designation of responsible employee. A recipient that employs 
fifteen or more persons shall designate at least one person to 
coordinate its efforts to comply with this part.
    (b) Adoption of grievance procedures. A recipient that employs 
fifteen or more persons shall adopt grievance procedures that 
incorporate appropriate due process standards and that provide for the 
prompt and equitable resolution of complaints alleging any action 
prohibited by this part. Such procedures need not be established with 
respect to complaints from applicants for employment or from applicants 
for admission to postsecondary educational institutions.



Sec. 217.8  Notice.

    (a) A recipient that employs fifteen or more persons shall take 
appropriate initial and continuing steps to notify participants, 
beneficiaries, applicants, and employees, including those with impaired 
vision or hearing, and unions or professional organizations holding 
collective bargaining or professional agreements with the recipient that 
it does not discriminate on the basis of handicap in violation of 
section 504, and this part. The notification shall

[[Page 770]]

state, where appropriate, that the recipient does not discriminate in 
admission or access to, or treatment or employment in, its programs and 
activities. The notification shall also include an identification of the 
responsible employee designated pursuant to Sec. 217.7(a). A recipient 
shall make the initial notification required by this paragraph within 90 
days of the effective date of this part. Methods of initial and 
continuing notification may include the posting of notices, publication 
in newspapers and magazines, placement of notices in recipients' 
publication, and distribution of memoranda or other written 
communications.
    (b) If a recipient publishes or uses recruitment materials or 
publications containing general information that it makes available to 
participants, beneficiaries, applicants, or employees, it shall include 
in those materials or publications a statement of the policy described 
in paragraph (a) of this section. A recipient may meet the requirement 
of this paragraph either by including appropriate inserts in existing 
materials and publications or by revising and reprinting the materials 
and publications.



Sec. 217.9  Administrative requirements for small recipients.

    The Administrator may require any recipient with fewer than fifteen 
employees, or any class of such recipients, to comply with Secs. 217.7 
and 217.8 in whole or in part, when the Administrator finds a violation 
of this part or finds that such compliance will not significantly impair 
the ability of the recipient or class of recipients to provide benefits 
or services.



Sec. 217.10  Effect of state or local law or other requirements and effect of employment opportunities.

    (a) The obligation to comply with this part is not obviated or 
alleviated by the existence of any state or local law or other 
requirement that, on the basis of handicap, imposes prohibitions or 
limits upon the eligibility of qualified handicapped persons to receive 
services or to practice any occupation or profession.
    (b) The obligation to comply with this part is not obviated or 
alleviated because employment opportunities in any occupation or 
profession are or may be more limited for handicapped persons than for 
nonhandicapped persons.



                     Subpart B--Employment Practices



Sec. 217.11  Discrimination prohibited.

    (a) General. (1) No qualified handicapped person shall, on the basis 
of handicap, be subjected to discrimination in employment under any 
program or activity to which this part applies.
    (2) A recipient shall make all decisions concerning employment under 
any program or activity to which this part applies in a manner which 
ensures that discrimination on the basis of handicap does not occur and 
may not limit, segregate, or classify applicants or employees in any way 
that adversely affects their opportunities or status because of 
handicap.
    (3) A recipient may not participate in a contractual or other 
relationship that has the effect of subjecting qualified handicapped 
applicants or employees to discrimination prohibited by this subpart. 
The relationships referred to in this subparagraph include relationships 
with employment and referral agencies, with labor unions, with 
organizations providing or administering fringe benefits to employees of 
the recipient, and with organizations providing training and 
apprenticeship programs.
    (b) Specific activities. The provisions of this subpart apply to:
    (1) Recruitment, advertising, and the processing of applications for 
employment;
    (2) Hiring, upgrading, promotion, award of tenure, demotion, 
transfer, layoff, termination, right of return from layoff, and 
rehiring;
    (3) Rates of pay or any other form of compensation and changes in 
compensation;
    (4) Job assignments, job classifications, organizational structures, 
position descriptions, lines of progression, and seniority lists;
    (5) Leaves of absence, sick leave, or any other leave;
    (6) Fringe benefits available by virtue of employment, whether or 
not administered by the recipient;

[[Page 771]]

    (7) Selection and financial support for training, including 
apprenticeship, professional meetings, conferences, and other related 
activities, and selection for leaves of absence to pursue training;
    (8) Employer sponsored activities, including social or recreational 
programs; and
    (9) Any other term, condition, or privilege of employment.
    (c) A recipient's obligation to comply with this subpart is not 
affected by any inconsistent term of any collective bargaining agreement 
to which it is a party.



Sec. 217.12  Reasonable accommodation.

    (a) A recipient shall make reasonable accommodation to the known 
physical or mental limitations of an otherwise qualified handicapped 
applicant or employee unless the recipient can demonstrate that the 
accommodation would impose an undue hardship on the operation of its 
program.
    (b) Reasonable accommodation may include: (1) Making facilities used 
by employees readily accessible to and usable by handicapped persons, 
and (2) job restructuring, part-time or modified work schedules, 
acquisition or modification of equipment or devices, the provision of 
readers or interpreters, and other similar actions.
    (c) In determining pursuant to paragraph (a) of this section whether 
an accommodation would impose an undue hardship on the operation of a 
recipient's program, factors to be considered include:
    (1) The overall size of the recipient's program with respect to 
number of employees, number and type of facilities and size of budget;
    (2) The type of the recipient's operation, including the composition 
and structure of the recipients workforce; and
    (3) The nature and cost of the accommodation needed.
    (d) A recipient may not deny any employment opportunity to a 
qualified handicapped employee or applicant if the basis for the denial 
is the need to made reasonable accommodation to the physical or mental 
limitations of the employee or applicant.



Sec. 217.13  Employment criteria.

    (a) A recipient may not make use of any employment test or other 
selection criterion that screens out or tends to screen out handicapped 
persons or any class of handicapped persons unless: (1) The test score 
or other selection criterion, as used by the recipient, is shown to be 
job-related for the position in question, and (2) alternative job-
related tests or criteria that do not screen out or tend to screen out 
as many handicapped persons are not shown by the Administrator to be 
available.
    (b) A recipient shall select and administer tests concerning 
employment so as best to ensure that, when administered to an applicant 
or employee who has a handicap that impairs sensory, manual, or speaking 
skills, the test results accurately reflect the applicant's or 
employee's job skills, aptitude, or whatever other factor the test 
purports to measure, rather than reflecting the applicant's or 
employee's impaired sensory, manual or speaking skills (except where 
those skills are the factors that the test purports to measure).



Sec. 217.14  Preemployment inquiries.

    (a) Except as provided in paragraphs (b) and (c) of this section, a 
recipient may not conduct a preemployment medical examination or may not 
make preemployment inquiry of an applicant as to whether the applicant 
is a handicapped person or as to the nature or severity of a handicap. A 
recipient may, however, make preemployment inquiry into an applicant's 
ability to perform job-related functions.
    (b) When a recipient is taking remedial action to correct the 
effects of past discrimination pursuant to Sec. 217.6(a), when a 
recipient is taking voluntary action to overcome the effects of 
conditions that resulted in limited participation in its federally 
assisted programs or activity pursuant to Sec. 217.6(b) or when a 
recipient is taking affirmative action pursuant to section 503 of the 
Act, the recipient may invite applicants for employment to indicate 
whether and to what extent they are handicapped. Provided, That:
    (1) The recipient states clearly on any written questionnaire used 
for this

[[Page 772]]

purpose or makes clear orally if no written questionnaire is used that 
the information requested is intended for use solely in connection with 
its remedial action obligations or its voluntary or affirmative action 
efforts; and
    (2) The recipient states clearly that the information is being 
requested on a voluntary basis, that it will be kept confidential as 
provided in paragraph (d) of this section, that refusal to provide it 
will not subject the applicant or employee to any adverse treatment, and 
that it will be used only in accordance with this part.
    (c) Nothing in this section shall prohibit a recipient from 
conditioning an offer of employment on the results of a medical 
examination conducted prior to the employee's entrance on duty, 
Provided, That: (1) All entering employees are subjected to such an 
examination regardless of handicap, and (2) the results of such an 
examination are used only in accordance with the requirements of this 
part.
    (d) Information obtained in accordance with this section as to the 
medical condition or history of the applicant shall be collected and 
maintained on separate forms that shall be accorded confidentially as 
medical records, except that:
    (1) Supervisors and managers may be informed regarding restrictions 
on the work or duties of handicapped persons and regarding necessary 
accommodations;
    (2) First aid and safety personnel may be informed, where 
appropriate, if the condition might require emergency treatment; and
    (3) Government officials investigating compliance with the Act shall 
be provided relevant information upon request.



Secs. 217.15--217.20  [Reserved]



                    Subpart C--Program Accessibility



Sec. 217.21  Discrimination prohibited.

    No qualified handicapped person shall, because a recipient's 
facilities within the United States are inaccessible to or unusable by 
handicapped persons, be denied the benefits of, be excluded from 
participation in, or otherwise be subjected to discrimination under any 
program or activity to which this part applies.



Sec. 217.22  Existing facilities.

    (a) Program accessibility. A recipient shall operate each program or 
activity to which this part applies so that the program or activity, 
when viewed in its entirety, is readily accessible to handicapped 
persons. This paragraph does not require a recipient to make each of its 
existing facilities or every part of a facility accessible to and usable 
by handicapped persons.
    (b) Methods. A recipient may comply with the requirement of 
paragraph (a) of this section through such means as redesign of 
equipment, reassignment of classes or other services to accessible 
buildings, alteration of existing facilities, assignment of aids to 
beneficiaries, and construction of new facilities in conformance with 
the requirements of Sec. 217.23, or any other methods that may result in 
making its program or activity accessible to handicapped persons. A 
recipient is not required to make structural changes in existing 
facilities where other methods are effective in achieving compliance 
with paragraph (a) of this section. In choosing among available methods 
for meeting the requirement of paragraph(s) of this section, a recipient 
shall give priority to those methods that offer programs and activities 
to handicapped persons in the most integrated setting appropriate.
    (c) Time period. A recipient shall comply with the requirement of 
paragraph (a) of this section within sixty days of the effective date of 
this part except that where structural changes in facilities are 
necessary, such changes shall be made within three years of the 
effective date of this part, but in any event as expeditiously as 
possible.
    (d) Transition plan. In the event that structural changes to 
facilities are necessary to meet the requirement of paragraph (a) of 
this section, a recipient shall develop, within six months of the 
effective date of this part, a transition plan setting forth the steps 
necessary to complete such changes. The plan shall be developed with the 
assistance of interested persons, including handicapped persons or 
organizations representing handicapped persons. A

[[Page 773]]

copy of the transition plan shall be made available for public 
inspection. The plan shall at a minimum:
    (1) Identify physical obstacles in the recipient's facilities that 
limit the accessibility of its program or activity to handicapped 
persons;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
full program accessibility and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the person responsible for implementation of the plan.
    (e) Notice. The recipient shall adopt and implement procedures to 
ensure that interested persons, including persons with impaired vision 
or hearing, can obtain information as to the existence and location of 
services, activities, and facilities that are accessible to and usable 
by handicapped persons.



Sec. 217.23  New construction.

    (a) Design and construction. Each facility or part of a facility 
constructed by, on behalf of, or for the use of a recipient shall be 
designed and constructed in such manner that the facility or part of the 
facility is readily accessible to and usable by handicapped persons, if 
the construction was commenced after the effective date of this part.
    (b) Alteration. Each facility or part of a facility which is altered 
by, on behalf of, or for the use of a recipient after the effective date 
of this part in a manner that affects or could affect the usability of 
the facility or part of the facility shall, to the maximum extent 
feasible, be altered in such manner that the altered portion of the 
facility is readily accessible to and usable by handicapped persons.
    (c) Conformance with Uniform Federal Accessibility Standards. (1) 
Effective as of January 18, 1991, design, construction, or alteration of 
buildings in conformance with sections 3-8 of the Uniform Federal 
Accessibility Standards (USAF) (appendix A to 41 CFR subpart 101-19.6) 
shall be deemed to comply with the requirements of this section with 
respect to those buildings. Departures from particular technical and 
scoping requirements of UFAS by the use of other methods are permitted 
where substantially equivalent or greater access to and usability of the 
building is provided.
    (2) For purposes of this section, section 4.1.6(1)(g) of UFAS shall 
be interpreted to exempt from the requirements of UFAS only mechanical 
rooms and other spaces that, because of their intended use, will not 
require accessibility to the public or beneficiaries or result in the 
employment or residence therein of persons with physical handicaps.
    (3) This section does not require recipients to make building 
alterations that have little likelihood of being accomplished without 
removing or altering a load-bearing structural member.
[45 FR 66415, Oct. 6, 1980, as amended at 55 FR 52138, 52141, Dec. 19, 
1990]



Secs. 217.24--217.40  [Reserved]



                   Subpart D--Postsecondary Education



Sec. 217.41  Application of this subpart.

    Subpart D applies within the United States to postsecondary 
education programs and activities, including postsecondary vocational 
education programs and activities, that receive or benefit from Federal 
financial assistance and to recipients that operate, or that receive or 
benefit from Federal financial assistance for the operation of such 
programs or activities within the United States.



Sec. 217.42  Admissions and recruitment.

    (a) General. Qualified handicapped persons may not, on the basis of 
handicap, be denied admission or be subjected to discrimination in 
admission or recruitment by a recipient to which this subpart applies.
    (b) Admissions. In administering its admission policies, a recipient 
to which this subpart applies:
    (1) May not apply limitation upon the number or proportion of 
handicapped persons who may be admitted;

[[Page 774]]

    (2) May not make use of any test or criterion for admission that has 
a disproportionate, adverse effect on handicapped persons or any class 
of handicapped persons unless (i) the test or criterion, as used by the 
recipient has been validated as a predictor of success in the education 
program or activity in question and (ii) alternate tests or criteria 
that have a less disproportionate, adverse effect are not shown by the 
Administrator to be available;
    (3) Shall assure itself that (i) admissions tests are selected and 
administered so as to best to ensure that, when a test is administered 
to an applicant who has a handicap that impairs sensory, manual, or 
speaking skills, the test results accurately reflect the applicant's 
aptitude or achievement level or whatever other factor the test purports 
to measure, rather than reflecting the applicant's impaired sensory, 
manual or speaking skills (except where those skills are the factors 
that the test purports to measure); (ii) admissions tests that are 
designed for persons with impaired sensory, manual or speaking skills 
are offered as often and in as timely a manner as are other admissions 
tests; and (iii) admissions tests are administered in facilities that, 
on the whole, are accessible to handicapped persons; and
    (4) Except as provided in paragraph (c) of this section, may not 
make preadmission inquiry as to whether an applicant for admission is a 
handicapped person but, after admission, may make inquiries on a 
confidential basis as to handicaps that may require accommodation.
    (c) Preadmission inquiry exception. When a recipient is taking 
remedial action to correct the effects of past discrimination pursuant 
to Sec. 217.6(a) or when a recipient is taking voluntary action to 
overcome the effects of conditions that resulted in limited 
participation in its federally assisted program or activity pursuant to 
Sec. 217.6(b), the recipient may invite applicants for admission to 
indicate whether and to what extent they are handicapped, Provided, 
That:
    (1) The recipient states clearly on any written questionnaire used 
for this purpose or makes clear orally if no written questionnaire is 
used that the information requested is intended for use solely in 
connection with its remedial action obligations or its voluntary action 
efforts; and
    (2) The recipient states clearly that the information is being 
requested on a voluntary basis, that it will be kept confidential, that 
refusal to provide it will not subject the applicant to any adverse 
treatment, and that it will be used only in accordance with this part.
    (d) Validity studies. For the purpose of paragraph (b)(2) of this 
section, a recipient may base prediction equations on first year grades, 
but shall conduct periodic validity studies against the criterion of 
overall success in the education program or activity in question in 
order to monitor the general validity of the test scores.



Sec. 217.43  Treatment of students; general.

    (a) No qualified handicapped student shall, on the basis of 
handicap, be excluded from participation in, be denied the benefits of, 
or otherwise be subjected to discrimination under any academic, 
research, occupational training, housing, health, insurance, counseling, 
financial aid, physical education, athletics, recreation, 
transportation, other extracurricular, or other postsecondary education 
program or activity to which this subpart applies.
    (b) A recipient to which this subpart applies that considers 
participation by students in education programs or activities not 
operated wholly by the recipient as part of, or equivalent to, an 
education program or activity operated by the recipient shall assure 
itself that the other education program or activity, as a whole, 
provides an equal opportunity for the participation of qualified 
handicapped persons.
    (c) A recipient to which this subpart applies may not, on the basis 
of handicap, exclude any qualified handicapped student from any course, 
course of study, or other part of its education program or activity.
    (d) A recipient to which this subpart applies shall operate its 
programs and activities in the most integrated setting appropriate.

[[Page 775]]



Sec. 217.44  Academic adjustments.

    (a) Academic requirements. A recipient to which this subpart applies 
shall make such modifications to its academic requirements as are 
necessary to ensure that such requirements do not discriminate or have 
the effect of discriminating, on the basis of handicap, against a 
qualified handicapped applicant or student. Academic requirements that 
the recipient can demonstrate are essential to the program of 
instruction being pursued by such student or to any directly related 
licensing requirement will not be regarded as discriminatory within the 
meaning of this section. Modifications may include changes in the length 
of time permitted for the completion of degree requirements, 
substitution of specific courses required for the completion of degree 
requirements, and adaptation of the manner in which specific courses are 
conducted.
    (b) Other rules. A recipient to which this subpart applies may not 
impose upon handicapped students other rules, such as the prohibition of 
tape recorders in classrooms or of dog guides in campus buildings, that 
have the effect of limiting the participation of handicapped students in 
the recipient's education program or activity.
    (c) Course examinations. In its course examinations or other 
procedures for evaluating students' academic achievement in its program, 
a recipient to which this subpart applies shall provide such methods for 
evaluating the achievement of students who have a handicap that impairs 
sensory, manual, or speaking skills as will best ensure that the results 
of the evaluation represents the student's achievement in the course, 
rather than reflecting the student's impaired sensory, manual, or 
speaking skills (except where such skills are the factors that the test 
purports to measure).
    (d) Auxiliary aids. (1) A recipient to which this subpart applies 
shall take such steps as are necessary to ensure that no handicapped 
student is denied the benefits of, excluded from participation in, or 
otherwise subjected to discrimination under the education program or 
activity operated by the recipient because of the absence of educational 
auxiliary aids for students with impaired sensory, manual, or speaking 
skills.
    (2) Auxiliary aids may include taped texts, interpreters or other 
effective methods of making orally delivered materials available to 
students with hearing impairments, readers in libraries for students 
with visual impairments, classroom equipment adapted for use by students 
with manual impairments, and other similar services and actions. 
Recipients need not provide attendants, individually prescribed devices, 
readers for personal use or study, or other devices or services of a 
personal nature.



Sec. 217.45  Housing.

    (a) Housing provided by the recipient. A recipient that provides 
housing to its nonhandicapped students shall provide comparable, 
convenient, and accessible housing to handicapped students at the same 
cost as to others. At the end of the transition period provided for in 
subpart C, such housing shall be available in sufficient quantity and 
variety so that the scope of handicapped students' choice of living 
accommodations is, as a whole, comparable to that of nonhandicapped 
students.
    (b) Other housing. A recipient that assists any agency, 
organization, or person in making housing available to any of its 
students shall take such action as may be necessary to assure itself 
that such housing is, as a whole, made available in a manner that does 
not result in discrimination on the basis of handicap.



Sec. 217.46  Financial and employment assistance to students.

    (a) Provision of financial assistance. (1) In providing financial 
assistance to qualified handicapped persons, a recipient to which this 
subpart applies may not (i), on the basis of handicap, provide less 
assistance than is provided to nonhandicapped persons, limit eligibility 
for assistance, or otherwise discriminate or (ii) assist any entity or 
person that provides assistance to any of the recipient's students in a 
manner that discriminates against qualified handicapped persons on the 
basis of handicap.

[[Page 776]]

    (2) A recipient may administer or assist in the administration of 
scholarships, fellowships, or other forms of financial assistance 
established under wills, trusts, bequests, or similar legal instruments 
that require awards to be made on the basis of factors that discriminate 
or have the effect of discriminating on the basis of handicap only if 
the overall effect of the award of scholarships, fellowships, and other 
forms of financial assistance is not discriminatory on the basis of 
handicap.
    (b) Assistance in making available outside employment. A recipient 
that assists any agency, organization, or person in providing employment 
opportunities to any of its students shall assure itself that such 
employment opportunities, as a whole, are made available in a manner 
that would not violate subpart B if they were provided by the recipient.
    (c) Employment of students by recipients. A recipient that employs 
any of its students may not do so in a manner that violates subpart B.



Sec. 217.47  Nonacademic services.

    (a) Physical education and athletics. (1) In providing physical 
education courses and athletics and similar programs and activities to 
any of its students, a recipient to which this subpart applies may not 
discriminate on the basis of handicap. A recipient that offers physical 
education courses or that operates or sponsors intercollegiate, club, or 
intramural athletics shall provide to qualified handicapped students an 
equal opportunity for participation in these activities.
    (2) A recipient may offer to handicapped students physical education 
and athletic activities that are separate or different only if 
separation or differentiation is consistent with the requirements of 
Sec. 217.43(d) and only if no qualified handicapped student is denied 
the opportunity to compete for teams or to participate in courses that 
are not separate or different.
    (b) Counseling and placement services. A recipient to which this 
subpart applies that provides personal, academic, or vocational 
counseling, guidance, or placement services to its students shall 
provide these services without discrimination on the basis of handicap. 
The recipient shall ensure that qualified handicapped students are not 
counseled toward more restrictive career objectives than are 
nonhandicapped students with similar interest and abilities. This 
requirement does not preclude a recipient from providing factual 
information about licensing and certification requirements that may 
present obstacles to handicapped persons in their pursuit of particular 
careers.
    (c) Social organizations. A recipient that provides significant 
assistance to fraternities, sororities, or similar organizations shall 
assure itself that the membership practices of such organizations do not 
permit discrimination otherwise prohibited by this subpart.



Secs. 217.48--217.60  [Reserved]



                          Subpart E--Procedures



Sec. 217.61  Procedures.

    The procedural provisons applicable to title VI of the Civil Rights 
Act of 1964 apply to this part. These procedures are found in 
Secs. 209.6-209.13 of this title.



Secs. 217.62--217.99  [Reserved]

  Appendix A to Part 217--Federal Financial Assistance to Which These 
                            Regulations Apply

    1. Grants to research and educational institutions in the United 
States to strengthen their capacity to develop and carry out programs 
concerned with the economic and social development of developing 
countries. (Section 122(d), Foreign Assistance Act of 1961, as amended, 
22 U.S.C. 2151(d).)
    2. Grants to land grant and other qualified agricultural 
universities and colleges in the United States to develop their 
capabilities to assist developing countries in agricultural teaching, 
research and extension services. (Section 297, Foreign Assistance Act of 
1961, as amended, 22 U.S.C. 2220(b).)
    3. Grants to private and voluntary agencies, non-profit 
organizations, educational institutions, and other qualified 
organizations for programs in the United States to promote the economic 
and social development of developing countries. (Section 103--106, 
Foreign Assistance Act of 1961, as amended, 22 U.S.C. 2151a--2151d.)

[[Page 777]]



PART 218--NONDISCRIMINATION ON THE BASIS OF AGE IN PROGRAMS OR ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE--Table of Contents




                           Subpart A--General

Sec.
218.01  What is the purpose of age discrimination regulations?
218.02  To what programs do these regulations apply?
218.03  Definitions.

         Subpart B--Standards for Determining Age Discrimination

218.11  Standards.

                 Subpart C--Duties of Agency Recipients

218.21  General responsibilities.
218.22  Notice to subrecipients.
218.23  Self-evaluation.
218.24  Information requirements.

   Subpart D--Investigation, Conciliation, and Enforcement Procedures

218.31  Compliance reviews.
218.32  Complaints.
218.33  Mediation.
218.34  Investigation.
218.35  Prohibition against intimidation or retaliation.
218.36  Compliance procedure.
218.37  Hearings, decisions, post-termination proceedings.
218.38  Remedial action by recipients.
218.39  Alternate funds disbursal procedure.

Appendices A-C to Part 218--List of Affected Programs

    Authority:  Age Discrimination Act of 1975, as amended, 42 U.S.C. 
6101 et seq.; 45 CFR part 90; 22 U.S.C. 2658, unless otherwise noted.

    Source:  45 FR 62980, Sept. 23, 1980, unless otherwise noted.



                           Subpart A--General



Sec. 218.01  What is the purpose of the age discrimination regulations?

    The purpose of these regulations is to set out the policies and 
procedures for the three foreign affairs agencies (State, USICA and AID) 
under the Age Discrimination Act of 1975 and the government-wide age 
discrimination regulations at 45 CFR part 90 (published at 44 FR 33768, 
June 12, 1979). The Act and the government-wide regulations prohibit 
discrimination on the basis of age in programs or activities in the 
United States receiving Federal financial assistance. The Act and the 
government-wide regulations permit federally assisted programs and 
activities, and recipients of Federal funds, to continue to use age 
distinctions and factors other than age which meet the requirements of 
the Act and the government-wide regulations.



Sec. 218.02  To what programs do these regulations apply?

    These regulations apply to each foreign affairs agency recipient and 
to each program or activity in the United States operated by the 
recipient which receives or benefits from Federal financial assistance 
provided by any of these agencies.



Sec. 218.03  Definitions.

    (a) The following terms used in this part are defined in the 
government-wide regulations (45 CFR 90.4, 44 FR 33768):
    Act
    Action
    Age
    Age distinction
    Age-related term
    Federal financial assistance
    Recipient (including subrecipients)
    United States
    (b) As used in this part,
    (1) Agency means the Department of State, the U.S. International 
Communication Agency, and the Agency for International Development.
    (2) Secretary means the Secretary of State, the Director of the U.S. 
International Communication Agency, and the Administrator of the Agency 
for International Development, or the designee of such officer.
    (3) Subrecipient means any of the entities in the definition of 
``recipient'' to which a recipient extends or passes on Federal 
financial assistance. A subrecipient is generally regarded as a 
recipient of Federal financial assistance and has all the duties of a 
recipient in these regulations.

[[Page 778]]



         Subpart B--Standards for Determining Age Discrimination



Sec. 218.11  Standards.

    The standards each agency uses to determine whether an age 
distinction or age-related term is prohibited are set out in part 90 
(primarily subpart B) of 45 CFR.



                 Subpart C--Duties of Agency Recipients



Sec. 218.21  General responsibilities.

    Each agency recipient has primary responsibility to ensure that its 
programs and activities are in compliance with the Act, the government-
wide regulations, and these regulations.



Sec. 218.22  Notice to subrecipients.

    Where a recipient passes on Federal financial assistance from an 
agency to subrecipients, the recipient shall provide the subrecipients 
written notice to their obligations under these regulations.



Sec. 218.23  Self-evaluation.

    (a) Each recipient employing the equivalent of 15 or more full-time 
employees shall complete a one-time written self-evaluation of its 
compliance under the act within 18 months of the effective date of these 
regulations.
    (b) In its self-evaluation each recipient shall identify each age 
distinction it uses and justify each age distinction it imposes on the 
program or activity receiving Federal financial assistance from an 
agency.
    (c) Each recipient shall take corrective action whenever a self-
evaluation indicates a violation of these regulations.
    (d) Each recipient shall make the self-evaluation available on 
request to the agency and to the public for a period of three years 
following its completion.



Sec. 218.24  Information requirements.

    Each recipient shall:
    (a) Make available upon request to the agency information necessary 
to determine whether the recipient is complying with the regulations.
    (b) Permit reasonable access by the agency to the books, records, 
accounts, and other recipient facilities and sources of information to 
the extent necessary to determine whether a recipient is in compliance 
with these regulations.



   Subpart D--Investigation, Conciliation, and Enforcement Procedures



Sec. 218.31  Compliance reviews.

    (a) The agency may conduct compliance reviews and pre-award reviews 
of recipients that will permit it to investigate and correct violations 
of these regulations. The agency may conduct these reviews even in the 
absence of a complaint against a recipient. The review may be as 
comprehensive as necessary to determine whether a violation of these 
regulations has occurred.
    (b) If a compliance review or preaward review indicates a violation 
of this part, the agency will attempt to achieve voluntary compliance 
with the Act. If voluntary compliance cannot be achieved, the agency 
will arrange for enforcement as described in Sec. 143.36



Sec. 218.32  Complaints.

    (a) Any person, individually or as a member of a class or on behalf 
of others, may file a complaint with an agency, alleging discrimination 
prohibited by these regulations based on an action occurring on or after 
July 1, 1979. A complainant shall file a complaint within 180 days from 
the date the complainant first had knowledge of the alleged act of 
discrimination. However, for good cause shown, the agency may extend 
this time limit.
    (b) The agency will attempt to facilitate the filing of complaints 
wherever possible, including taking the following measures:
    (1) Accepting as a sufficient complaint, any written statement which 
identifies the parties involved, describes generally the action or 
practice complained of, and is signed by the complainant.
    (2) Freely permitting a complainant to add information to the 
complaint to meet the requirements of a sufficient complaint.

[[Page 779]]

    (3) Widely disseminating information regarding the obligations of 
recipients under the Act and these regulations.
    (4) Notifying the complainant and the recipient of their rights 
under the complaint procedure, including the right to have a 
representative at all stages of the complaint process.
    (5) Notifying the complainant and the recipient (or their 
representatives) of their right to contact the agency for information 
and assistance regarding the complaint resolution process.
    (c) The agency will return to the complainant any complaint outside 
the jurisdiction of these regulations and will state the reason(s) why 
it is outside the jurisdiction of these regulations.



Sec. 218.33  Mediation.

    (a) Referral of complaints for mediation. The agency will refer to 
the Federal Mediation and Conciliation Service all complaints that:
    (1) fall within the jurisdiction of these regulations; and
    (2) Contain all information necessary for further processing.
    (b) Both the complainant and the recipient shall participate in the 
mediation process to the extend necessary to reach an agreement or make 
an informed judgment that an agreement is not possible. There must be at 
least one meeting with the mediator, before the agency will accept a 
judgment that an agreement is not possible. However, the recipient and 
the complainant need not meet with the mediator at the same time.
    (c) If the complainant and the recipient reach an agreement, the 
mediator shall prepare a written statement of the agreement and have the 
complainant and recipient sign it. The mediator shall send a copy of the 
agreement to the agency. The agency shall take no further action on the 
complaint unless the complainant or the recipient fails to comply with 
the agreement.
    (d) The mediator shall protect the confidentiality of all 
information obtained in the course of the mediation process. No mediator 
shall testify in any adjudicative proceeding, produce any document, or 
otherwise disclose any information obtained in the course of the 
mediation process without prior approval of the head of the mediation 
agency.
    (e) The agency will use the mediation process for a maximum of 60 
days after receiving a compliant. Mediation ends if:
    (1) Sixty days elapse from the time the agency receives the 
complaints; or
    (2) Prior to the end of that 60-day period, an agreement is reached; 
or
    (3) Prior to the end of that 60-day period, the mediator determines 
that an agreement cannot be reached.
    (f) The mediator shall return unresolved complaints to the agency.



Sec. 218.34  Investigation.

    (a) Informal investigation. (1) The agency will investigate 
complaints that are unresolved after mediation or are reopened because 
of a violation of a mediation agreement.
    (2) As part of the initial investigation, the agency will use 
informal fact finding methods, including joint or separate discussions 
with the complainant and recipient to establish the facts, and, if 
possible, settle the complaint on terms that are mutually agreeable. The 
agency may seek the assistance of any involved State program agency.
    (3) The agency will put any agreement in writing and have it signed 
by the parties and an authorized official of the agency.
    (4) The settlement shall not affect the operation of any other 
enforcement efforts of the agency, including compliance reviews and 
other individual complaints which may involve the recipient.
    (5) The settlement is not a finding of discrimination against a 
recipient.
    (b) Formal investigation. If the agency cannot resolve the complaint 
through informal investigation, it will begin to develop formal findings 
through further investigation of the complaint. If the investigation 
indicates a violation of these regulations, the agency will attempt to 
obtain voluntary compliance. If the agency cannot obtain voluntary 
compliance, it will begin enforcement as described in Sec. 218.36.

[[Page 780]]



Sec. 218.35  Prohibition against intimidation or retaliation.

    A recipient may not engage in acts of intimidation or retaliation 
against any person who:
    (a) Attempts to assert a right protected by these regulations; or
    (b) Cooperates in any mediation, investigation, hearing, or other 
part of the agency's investigation, conciliation, and enforcement 
process.



Sec. 218.36  Compliance procedure.

    (a) An agency may enforce the Act and these regulations through:
    (1) Termination of a recipient's Federal financial assistance from 
the agency under the program or activity involved where the recipient 
has violated the Act and these regulations. The determination of the 
recipient's violation may be made only after a recipient has had an 
opportunity for a hearing on the record before an administrative law 
judge. Therefore, cases which are settled in mediation or prior to a 
hearing, will not involve termination of a recipient's Federal financial 
assistance from the agency.
    (2) Any other means authorized by law including but not limited to:
    (i) Referral to the Department of Justice for proceedings to enforce 
any rights of the United States or obligations by the Act and these 
regulations.
    (ii) Use of any requirement of or referral to any Federal, state, or 
local government agency which will have the effect of correcting a 
violation of the Act or these regulations.
    (b) The agency will limit any termination under paragraph (a)(1) of 
this section to the particular recipient and particular program or 
activity the agency finds in violation of these regulations. The agency 
will not base any part of a termination on a finding with respect to any 
program or activity of the recipient which does not receive Federal 
financial assistance from the agency.
    (c) The agency will take no action under paragraph (a) of this 
section until:
    (1) The agency head has advised the recipient of its failure to 
comply with these regulations and has determined that voluntary 
compliance cannot be obtained.
    (2) Thirty days have lapsed after the agency head has sent a written 
report of the circumstances and grounds of the action to the committees 
of the Congress having legislative jurisdiction over the Federal program 
or activity involved. The agency head shall file a report whenever any 
action is taken under paragraph (a) of this section.
    (d) The agency head also may defer granting new Federal financial 
assistance from the agency to a recipient when a hearing under paragraph 
(a)(1) of this section is initiated.
    (1) New Federal financial assistance from the agency includes all 
assistance for which the agency requires an application or approval, 
including renewal of continuation of existing activities, or 
authorization of the new activities, during the deferral period. New 
Federal financial assistance from the agency does not include increases 
in funding as a result of changed computation of formula awards or 
assistance approved prior to the beginning of a hearing under paragraph 
(a)(1) of this section.
    (2) The agency will not begin a deferral until the recipient has 
received a notice of opportunity for a hearing under paragraph (a)(1) of 
this section. The agency will not continue a deferral for more than 60 
days unless a hearing has begun within that time or the time for 
beginning the hearing has been extended by mutual consent of the 
recipient and the agency head. The agency will not continue a deferral 
for more than 30 days after the close of a hearing unless the hearing 
results in a finding against the recipient.



Sec. 218.37  Hearings, decisions, post-termination proceedings.

    Certain procedural provisions applicable to title VI of the Civil 
Rights Act of 1964 apply to enforcement of this part. They are 22 CFR 
part 209.



Sec. 218.38  Remedial action by recipient.

    Where the agency head finds a recipient has discriminated on the 
basis of age, the recipient shall take any remedial action that the 
agency head may require to overcome the effects of the discrimination. 
If another recipient exercises control over the recipient that has 
discriminated, the agency head

[[Page 781]]

may require both recipients to take remedial action.



Sec. 218.39  Alternate funds disbursal procedure.

    (a) When an agency withholds funds from a recipient under these 
regulations, the agency head may disburse the withheld funds directly to 
an alternate recipient, any public or non-profit private organization or 
agency, or State or political subdivision of the State.
    (b) The agency head will require any alternate recipient to 
demonstrate:
    (1) The ability to comply with these regulations; and
    (2) The ability to achieve the goals of the Federal statute 
authorizing the program or activity.

            Appendix A to Part 218--List of Affected Programs

Programs of Financial Assistance Administered by the Department of State 
                Subject to Age Discrimination Regulations

    Resettlement of Refugees in the United States Under the Migration 
and Refugee Assistant Act of 1962, as amended (22 U.S.C. 2601 et seq.).
    Diplomat in Residence Program of the Foreign Service Institute Under 
Title VII of the Foreign Service Act of 1946, as amended (22 U.S.C. 1041 
et seq.).
    Assignments under section 576 of the Foreign Service Act of 1946, as 
amended (22 U.S.C. 966).

            Appendix B to Part 218--List of Affected Programs

   Programs of Financial Assistance Administered by the United States 
    International Communication Agency Subject to Age Discrimination 
                               Regulations

    Educational and Cultural Exchanges under the Mutual Educational and 
Cultural Exchange Act of 1961, as amended (22 U.S.C. 1431-1479).

            Appendix C to Part 218--List of Affected Programs

   Program of Financial Assistance Administered by AID Subject to Age 
                       Discrimination Regulations

    1. Grants to research and educational institutions in the United 
States to strengthen their capacity to develop and carry out programs 
concerned with the economic and social development of developing 
countries. (Section 122(d), Foreign Assistance Act of 1961, as amended, 
22 U.S.C. 2151(d)).
    2. Grants to land grant and other qualified agricultural 
universities and colleges in the United States to develop their 
capabilities to assist developing countries in agricultural teaching, 
research and extension services. (Section 297, Foreign Assistance Act of 
1961, as amended, 22 U.S.C. 2220(b)).
    3. Grants to private and voluntary agencies, non-profit 
organization, educational institutions, and other qualified 
organizations for programs in the United States to promote the economic 
and social development of developing countries. (Sections 103-106, 
Foreign Assistance Act of 1961, as amended, 22 U.S.C. 2151a-2151d).



PART 219--ENFORCEMENT OF NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR ACTIVITIES CONDUCTED BY INTERNATIONAL DEVELOPMENT COOPERATION AGENCY, AGENCY 

FOR INTERNATIONAL DEVELOPMENT--Table of Contents




Sec.
219.101  Purpose.
219.102  Application.
219.103  Definitions.
219.104--219.109  [Reserved]
219.110  Self-evaluation.
219.111  Notice.
219.112--219.129  [Reserved]
219.130  General prohibitions against discrimination.
219.131--219.139  [Reserved]
219.140  Employment.
219.141--219.148  [Reserved]
219.149  Program accessibility: Discrimination prohibited.
219.150  Program accessibility: Existing facilities.
219.151  Program accessibility: New construction and alterations.
219.152--219.159  [Reserved]
219.160  Communications.
219.161--219.169  [Reserved]
219.170  Compliance procedures.
219.171--219.999  [Reserved]

    Authority:  29 U.S.C. 794.

    Source:  51 FR 4576, Feb. 5, 1986, unless otherwise noted.



Sec. 219.101  Purpose.

    This part effectuates section 119 of the Rehabilitation, 
Comprehensive Services, and Developmental Disabilities Amendments of 
1978, which

[[Page 782]]

amended section 504 of the Rehabilitation Act of 1973 to prohibit 
discrimination on the basis of handicap in programs or activities 
conducted by Executive agencies or the United States Postal Service.



Sec. 219.102  Application.

    This part applies to all programs or activities conducted by the 
agency.



Sec. 219.103  Definitions.

    For purposes of this part, the term--
    Assistant Attorney General means the Assistant Attorney General, 
Civil Rights Division, United States Department of Justice.
    Auxiliary aids means services or devices that enable persons with 
impaired sensory, manual, or speaking skills to have an equal 
opportunity to participate in, and enjoy the benefits of, programs or 
activities conducted by the agency. For example, auxiliary aids useful 
for persons with impaired vision include readers, Brailled materials, 
audio recordings, telecommunications devices and other similar services 
and devices. Auxiliary aids useful for persons with impaired hearing 
include telephone handset amplifiers, telephones compatible with hearing 
aids, telecommunication devices for deaf persons (TDD's), interpreters, 
notetakers, written materials, and other similar services and devices.
    Complete complaint means a written statement that contains the 
complainant's name and address and describes the agency's alleged 
discriminatory action in sufficient detail to inform the agency of the 
nature and date of the alleged violation of section 504. It shall be 
signed by the complainant or by someone authorized to do so on his or 
her behalf. Complaints filed on behalf of classes or third parties shall 
describe or identify (by name, if possible) the alleged victims of 
discrimination.
    Facility means all or any portion of buildings, structures, 
equipment, roads, walks, parking lots, rolling stock or other 
conveyances, or other real or personal property.
    Handicapped person means any person who has a physical or mental 
impairment that substantially limits one or more major life activities, 
has a record of such an impairment, or is regarded as having such an 
impairment.
    As used in this definition, the phrase:
    (1) Physical or mental impairment includes--
    (i) Any physiological disorder or condition, cosmetic disfigurement, 
or anatomical loss affecting one of more of the following body systems: 
Neurological; musculoskeletal; special sense organs; respiratory, 
including speech organs; cardiovascular; reproductive; digestive; 
genitourinary; hemic and lymphatic; skin; and endocrine; or
    (ii) Any mental or psychological disorder, such as mental 
retardation, organic brain syndrome, emotional or mental illness, and 
specific learning disabilities. The term ``physical or mental 
impairment'' includes, but is not limited to, such diseases and 
conditions as orthopedic, visual, speech, and hearing impairments, 
cerebral palsy, epilepsy, muscular dystrophy, multiple sclerosis, 
cancer, heart disease, diabetes, mental retardation, emotional illness, 
and drug addition and alcholism.
    (2) Major life activities includes functions such as caring for 
one's self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (3) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more major life activities.
    (4) Is regarded as having an impairment means--
    (i) Has a physical or mental impairment that does not substantially 
limit major life activities but is treated by the agency as constituting 
such a limitation;
    (ii) Has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward 
such impairment; or
    (iii) Has none of the impairments defined in paragraph (1) of this 
definition but is treated by the agency as having such an impairment.
    Qualified handicapped person means--
    (1) With respect to any agency program or activity under which a 
person is required to perform services or to achieve a level of 
accomplishment, a

[[Page 783]]

handicapped person who meets the essential eligibility requirements and 
who can achieve the purpose of the program or activity without 
modifications in the program or activity that the agency can demonstrate 
would result in a fundamental alteration in its nature; or
    (2) With respect to any other program or activity, a handicapped 
person who meets the essential eligibility requirements for 
participation in, or receipt of benefits from, that program or activity.
    (3) Qualified handicapped person is defined for purposes of 
employment in 29 CFR 1613.702(f), which is made applicable to this part 
by Sec. 219.140.
    Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112, 87 Stat. 394 (29 U.S.C. 794)), as amended by the 
Rehabilitation Act Amendments of 1974 (Pub. L. 93-516, 88 Stat. 1617), 
and the Rehabilitation, Comprehensive Services, and Developmental 
Disabilities Amendments of 1978 (Pub. L. 95-602, 92 Stat. 2955). As used 
in this part, section 504 applies only to programs or activities 
conducted by Executive agencies and not to federally assisted programs.
[51 FR 4576, Feb. 5, 1986; 51 FR 7543, Mar. 5, 1986]



Secs. 219.104--219.109  [Reserved]



Sec. 219.110  Self-evaluation.

    (a) The agency shall, by April 9, 1987, evaluate its current 
policies and practices, and the effects thereof, that do not or may not 
meet the requirements of this part, and, to the extent modification of 
any such policies and practices is required, the agency shall proceed to 
make the necessary modifications.
    (b) The agency shall provide an opportunity to interested persons, 
including handicapped persons or organizations representing handicapped 
persons, to participate in the self-evaluation process by submitting 
comments (both oral and written).
    (c) The agency shall, until three years following the completion of 
the self-evaluation, maintain on file and make available for public 
inspections:
    (1) A description of areas examined and any problems identified, and
    (2) A description of any modifications made.



Sec. 219.111  Notice.

    The agency shall make available to employees, applicants, 
participants, beneficiaries, and other interested persons such 
information regarding the provisions of this part and its applicability 
to the programs or activities conducted by the agency, and make such 
information available to them in such manner as the head of the agency 
finds necessary to apprise such persons of the protections against 
discrimination assured them by section 504 and this regulation.



Secs. 219.112--219.129  [Reserved]



Sec. 219.130  General prohibitions against discrimination.

    (a) No qualified handicapped person shall, on the basis of handicap, 
be excluded from participation in, be denied the benefits of, or 
otherwise be subjected to discrimination under any program or activity 
conducted by the agency.
    (b)(1) The agency, in providing any aid, benefit, or service, may 
not, directly or through contractual, licensing, or other arrangements, 
on the basis of handicap--
    (i) Deny a qualified handicapped person the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualfied handicapped person an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified handicapped person with an aid, benefit, 
or service that is not as effective in affording equal opportunity to 
obtain the same result, to gain the same benefit, or to reach the same 
level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits, or services to 
handicapped persons or to any class of handicapped persons than is 
provided to others unless such action is necessary to provide qualified 
handicapped persons with aid, benefits, or services that are as 
effective as those provided to others;

[[Page 784]]

    (v) Deny a qualified handicapped person the opportunity to 
participate as a member of planning or advisory boards; or
    (vi) Otherwise limit a qualified handicapped person in the enjoyment 
of any right, privilege, advantage, or opportunity enjoyed by others 
receiving the aid, benefit, or service.
    (2) The agency may not deny a qualified handicapped person the 
opportunity to participate in programs or activities that are not 
separate or different, despite the existence of permissibly separate or 
different programs or activities.
    (3) The agency may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration the purpose 
or effect of which would--
    (i) Subject qualified handicapped persons to discrimination on the 
basis of handicap; or
    (ii) Defeat or substantially impair accomplishment of the objectives 
of a program or activity with respect to handicapped persons.
    (4) The agency may not, in determining the site or location of a 
facility, make selections the purpose or effect of which would--
    (i) Exclude handicapped persons from, deny them the benefits of, or 
otherwise subject them to discrimination under any program or activity 
conducted by the agency; or
    (ii) Defeat or substantially impair the accomplishment of the 
objectives of a program or activity with respect to handicapped persons.
    (5) The agency, in the selection of procurement contractors, may not 
use criteria that subject qualified handicapped persons to 
discrimination on the basis of handicap.
    (c) The exclusion of nonhandicapped persons from the benefits of a 
program limited by Federal statute or Executive order to handicapped 
persons or the exclusion of a specific class of handicapped persons from 
a program limited by Federal statute or Executive order to a different 
class of handicapped persons is not prohibited by this part.
    (d) The agency shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified handicapped 
persons.



Secs. 219.131--219.139  [Reserved]



Sec. 219.140  Employment.

    No qualified handicapped person shall, on the basis of handicap, be 
subjected to discrimination in employment under any program or activity 
conducted by the agency. The definitions, requirements, and procedures 
of section 501 of the Rehabilitation Act of 1973 (29 U.S.C. 791), as 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613, shall apply to employment in federally conducted programs or 
activities.



Secs. 219.141--219.148  [Reserved]



Sec. 219.149  Program accessibility: Discrimination prohibited.

    Except as otherwise provided in Sec. 219.150, no qualified 
handicapped person shall, because the agency's facilities are 
inaccessible to or unusable by handicapped persons, be denied the 
benefits of, be excluded from participation in, or otherwise be 
subjected to discrimination under any program or activity conducted by 
the agency.



Sec. 219.150  Program accessibility: Existing facilities.

    (a) General. The agency shall operate each program or activity so 
that the program or activity, when viewed in its entirety, is readily 
accessible to and usable by handicapped persons. This paragraph does 
not--
    (1) Necessarily require the agency to make each of its existing 
facilities accessible to and usable by handicapped persons; or
    (2) Require the agency to take any action that it can demonstrate 
would result in a fundamental alteration in the nature of a program or 
activity or in undue financial and administrative burdens. In those 
circumstances where agency personnel believe that the proposed action 
would fundamentally alter the program or activity or would result in 
undue financial and administrative burdens, the agency has the burden of 
proving that compliance with Sec. 219.150(a) would result in such 
alteration or burdens. The decision that

[[Page 785]]

compliance would result in such alteration or burdens must be made by 
the agency head or his or her designee after considering all agency 
resources available for use in the funding and operation of the 
conducted program or activity, and must be accompanied by a written 
statement of the reasons for reaching that conclusion. If an action 
would result in such an alteration or such burdens, the agency shall 
take any other action that would not result in such an alteration or 
such burdens but would nevertheless ensure that handicapped persons 
receive the benefits and services of the program or activity.
    (b) Methods. The agency may comply with the requirements of this 
section through such means as redesign of equipment, reassignment of 
services to accessible buildings, assignment of aides to beneficiaries, 
home visits, delivery of services at alternate accessible sites, 
alteration of existing facilities and construction of new facilities, 
use of accessible rolling stock, or any other methods that result in 
making its programs or activities readily accessible to and usable by 
handicapped persons. The agency is nor required to make structural 
changes in existing facilities where other methods are effective in 
achieving compliance with this section. The agency, in making 
alterations to existing buildings, shall meet accessibility requirements 
to the extent compelled by the Architectural Barriers Act of 1968, as 
amended (42 U.S.C. 4151-4157), and any regulations implementing it. In 
choosing among available methods for meeting the requirements of this 
section, the agency shall give priority to those methods that offer 
programs and activities to qualified handicapped persons in the most 
integrated setting appropriate.
    (c) Time period for compliance. The agency shall comply with the 
obligations established under this section by June 6, 1986, except that 
where structural changes in facilities are undertaken, such changes 
shall be made by April 7, 1989, but in any event as expeditiously as 
possible.
    (d) Transition plan. In the event that structural changes to 
facilities will be undertaken to achieve program accessibility, the 
agency shall develop, by October 7, 1986, a transition plan setting 
forth the steps necessary to complete such changes. The agency shall 
provide an opportunity to interested persons, including handicapped 
persons or organizations representing handicapped persons, to 
participate in the development of the transition plan by submitting 
comments (both oral and written). A copy of the transition plan shall be 
made available for public inspection. The plan shall, at a minimum--
    (1) Identify physical obstacles in the agency's facilities that 
limit the accessibility of its programs or activities to handicapped 
persons;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
compliance with this section and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the official responsible for implementation of the 
plan.
[51 FR 4576, Feb. 5, 1986; 51 FR 7543, Mar. 5, 1986]



Sec. 219.151  Program accessibility: New construction and alterations.

    Each building or part of a building that is constructed or altered 
by, on behalf of, or for the use of the agency shall be designed, 
constructed, or altered so as to be readily accessible to and usable by 
handicapped persons. The definitions, requirements, and standards of the 
Architectural Barriers Act (42 U.S.C. 4151-4157), as established in 41 
CFR 101-19.600 to 101-19.607, apply to buildings covered by this 
section.



Secs. 219.152--219.159  [Reserved]



Sec. 219.160  Communications.

    (a) The agency shall take appropriate steps to ensure effective 
communication with applicants, participants, personnel of other Federal 
entities, and members of the public.
    (1) The agency shall furnish appropriate auxiliary aids where 
necessary to afford a handicapped person an equal opportunity to 
participate in, and

[[Page 786]]

enjoy the benefits of, a program or activity conducted by the agency.
    (i) In determining what type of auxiliary aid is necessary, the 
agency shall give primary consideration to the requests of the 
handicapped person.
    (ii) The agency need not provide individually prescribed devices, 
readers for personal use or study, or other devices of a personal 
nature.
    (2) Where the agency communicates with applicants and beneficiaries 
by telephone, telecommunication devices for deaf persons (TDD's) or 
equally effective telecommunication systems shall be used.
    (b) The agency shall ensure that interested persons, including 
persons with impaired vision or hearing, can obtain information as to 
the existence and location of accessible services, activities, and 
facilities.
    (c) The agency shall provide signage at a primary entrance to each 
of its inaccessible facilities, directing users to a location at which 
they can obtain information about accessible facilities. The 
international symbol for accessibility shall be used at each primary 
entrance of an accessible facility.
    (d) This section does not require the agency to take any action that 
it can demonstrate would result in a fundamental alteration in the 
nature of a program or activity or in undue financial and administrative 
burdens. In those circumstances where agency personnel believe that the 
proposed action would fundamentally alter the program or activity or 
would result in undue financial and administrative burdens, the agency 
has the burden of proving that compliance with Sec. 219.160 would result 
in such alteration or burdens. The decision that compliance would result 
in such alteration or burdens must be made by the agency head or his or 
her designee after considering all agency resources available for use in 
the funding and operation of the conducted program or activity, and must 
be accompanied by a written statement of the reasons for reaching that 
conclusion. If an action required to comply with this section would 
result in such an alteration or such burdens, the agency shall take any 
other action that would not result in such an alteration or such burdens 
but would nevertheless ensure that, to the maximum extent possible, 
handicapped persons receive the benefits and services of the program or 
activity.



Secs. 219.161--219.169  [Reserved]



Sec. 219.170  Compliance procedures.

    (a) Except as provided in paragraph (b) of this section, this 
section applies to all allegations of discrimination on the basis of 
handicap in programs or activities conducted by the agency.
    (b) The agency shall process complaints alleging violations of 
section 504 with respect to employment according to the procedures 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613 pursuant to section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791).
    (c) Director, Office of Equal Opportunity Programs shall be 
responsible for coordinating implementation of this section. Complaints 
may be sent to Director, Office of Equal Opportunity Programs, Agency 
for International Development, International Development Cooperation 
Agency, Room 1224, SA-1, Washington, DC.
    (d) The agency shall accept and investigate all complete complaints 
for which it has jurisdiction. All complete complaints must be filed 
within 180 days of the alleged act of discrimination. The agency may 
extend this time period for good cause.
    (e) If the agency receives a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate government 
entity.
    (f) The agency shall notify the Architectural and Transportation 
Barriers Compliance Board upon receipt of any complaint alleging that a 
building or facility that is subject to the Architectural Barriers Act 
of 1968, as amended (42 U.S.C. 4151-4157), or section 502 of the 
Rehabilitation Act of 1973, as amended (29 U.S.C. 792), is not readily 
accessible to and usable by handicapped persons.
    (g) Within 180 days of the receipt of a complete complaint for which 
it has jurisdiction, the agency shall notify the complainant of the 
results of the investigation in a letter containing--

[[Page 787]]

    (1) Findings of fact and conclusions of law;
    (2) A description of a remedy for each violation found;
    (3) A notice of the right to appeal.
    (h) Appeals of the findings of fact and conclusions of law or 
remedies must be filed by the complainant within 90 days of receipt from 
the agency of the letter required by Sec. 219.170(g). The agency may 
extend this time for good cause.
    (i) Timely appeals shall be accepted and processed by the head of 
the agency.
    (j) The head of the agency shall notify the complainant of the 
results of the appeal within 60 days of the receipt of the request. If 
the head of the agency determines that additional information is needed 
from the complainant, he or she shall have 60 days from the date of 
receipt of the additional information to make his or her determination 
on the appeal.
    (k) The time limits cited in paragraphs (g) and (j) of this section 
may be extended with the permission of the Assistant Attorney General.
    (l) The agency may delegate its authority for conducting complaint 
investigations to other Federal agencies, except that the authority for 
making the final determination may not be delegated to another agency.
[51 FR 4576, Feb. 5, 1986, as amended at 51 FR 4576, Feb. 5, 1986]



Secs. 219.171--219.999  [Reserved]



PART 221--ISRAEL LOAN GUARANTEE STANDARD TERMS AND CONDITIONS--Table of Contents




                         Subpart A--Definitions

Sec.
221.01  Definitions.

                        Subpart B--The Guarantee

221.11  The Guarantee.
221.12  Guarantee eligibility.
221.13  Non-impairment of the Guarantee.
221.14  Transferability of Guarantee; Note Register.
221.15  Fiscal Agent obligations.

             Subpart C--Procedure for Obtaining Compensation

221.21  Event of Default; Application for Compensation; payment.
221.22  No acceleration of Eligible Notes.
221.23  Payment to A.I.D. of excess amounts received by a Noteholder.
221.24  Subrogation of A.I.D.

                          Subpart D--Covenants

221.31  Prosecution of claims.
221.32  Change in agreements.

                        Subpart E--Administration

221.41  Arbitration.
221.42  Notice.
221.43  Governing law.

Appendix A to Part 221--Application for Compensation

    Authority:  22 U.S.C. 2186.

    Source:  58 FR 14148, Mar. 16, 1993, unless otherwise noted.



                         Subpart A--Definitions



Sec. 221.01  Definitions.

    Wherever used in these standard terms and conditions:
    (a) A.I.D. means the United States Agency for International 
Development or its successor with respect to the guarantee authorities 
contained in title III, chapter 2 of part I of the Foreign Assistance 
Act of 1961, as amended (the ``Act'').
    (b) Eligible Note(s) means [a] Notes[s] meeting the eligibility 
criteria set out in Sec. 221.12 hereof.
    (c) Noteholder means the owner of an Eligible Note who is registered 
as such on the Note Register of Eligible Notes required to be maintained 
by the Fiscal Agent.
    (d) Borrower means the Government of Israel, on behalf of the State 
of Israel.
    (e) Defaulted payment means, as of any date,
    (1) In respect of any current coupon Eligible Note, any interest 
amount and/or principal amount not paid when due, and
    (2) In respect of any zero-coupon Eligible Note, any maturity amount 
not paid when due.
    (f) Further guaranteed payments means the amount of any loss 
suffered by a Noteholder by reason of the Borrower's failure to comply 
on a timely basis with any obligation it may have under an Eligible Note 
to indemnify and hold harmless a Noteholder from taxes or

[[Page 788]]

governmental charges or any expense arising out of taxes or any other 
governmental charges relating to the Eligible Note in the country of the 
Borrower.
    (g) Loss of investment respecting any Eligible Note means an amount 
in Dollars equal to the total of the:
    (1) Defaulted Payment unpaid as of the Date of Application,
    (2) Further Guaranteed Payments unpaid as of the Date of 
Application, and
    (3) Interest accrued and unpaid at the rate(s) specified in the 
Eligible Note(s) on the Defaulted Payment and Further Guaranteed 
Payments, in each case from the date of default with respect to such 
payment to and including the date on which full payment thereof is made 
to the Noteholder.
    (h) Application for compensation means an executed application in 
the form of appendix A to this part which a Noteholder, or the Fiscal 
Agent on behalf of a Noteholder, files with A.I.D. pursuant to 
Sec. 221.21 of this part.
    (i) Applicant means a Noteholder who files an Application for 
Compensation with A.I.D., either directly or through the Fiscal Agent 
acting on behalf of a Noteholder.
    (j) Date of application means the effective date of an Application 
for Compensation filed with A.I.D. pursuant to Sec. 221.21 of this part.
    (k) Business day means any day other than a day on which banks in 
New York, New York are closed or authorized to be closed or a day which 
is observed as a federal holiday in Washington, DC, by the United States 
Government.
    (l) Guarantee payment date means a Business Day not more than three 
(3) Business Days after the related Date of Application.
    (m) Person means any legal person, including any individual, 
corporation, partnership, joint venture, association, joint stock 
company, trust, unincorporated organization, or government or any agency 
or political subdivision thereof.



                        Subpart B--The Guarantee



Sec. 221.11  The Guarantee.

    Subject to these terms and conditions, the United States of America, 
acting through A.I.D., agrees to pay to, or upon the instructions of, 
any Noteholder on each Guarantee Payment Date compensation in Dollars 
equal to such Noteholder's Loss of Investment under its Eligible Note; 
provided, however, that no such payment shall be made to any Noteholder, 
for any such loss arising out of fraud or misrepresentation for which 
such Noteholder is responsible or of which it had knowledge at the time 
it became such Noteholder.
    This Guarantee shall apply to each Eligible Note registered on the 
Note Register required to be maintained by the Fiscal Agent.



Sec. 221.12  Guarantee eligibility.

    (a) Eligible Notes only may be guaranteed hereunder. Notes in order 
to achieve Eligible Note status must be signed on behalf of the 
Borrower, manually or in facsimile, by a duly authorized representative 
of the Borrower; and they must contain a guarantee legend incorporating 
these Standard Terms and Conditions signed on behalf of A.I.D. by either 
a manual signature or a facsimile signature of an authorized 
representative of A.I.D., together with a certificate of authentication 
manually executed by a Fiscal Agent whose appointment by the Borrower is 
consented to by A.I.D. in a Fiscal Agency Agreement (the ``Fiscal 
Agent'').
    (b) A.I.D. shall designate, in a certificate delivered to the Fiscal 
Agent, the Person(s) whose signature shall be binding on A.I.D. The 
certificate of authentication of the Fiscal Agent issued pursuant to the 
Fiscal Agency Agreement shall, when manually executed by the Fiscal 
Agent, be conclusive evidence binding on A.I.D. that a Note has been 
duly executed on behalf of the Borrower and delivered.



Sec. 221.13  Non-impairment of the Guarantee.

    The full faith and credit of the United States of America is pledged 
to the performance of this Guarantee. The Guarantee shall not be 
affected or impaired by any defect in the authorization, execution, 
delivery or enforceability of any agreement or other document executed 
by a Noteholder, A.I.D.,

[[Page 789]]

the Fiscal Agent or the Borrower in connection with the transactions 
contemplated by this Guarantee. This non-impairment of the guarantee 
provision shall not, however, be operative with respect to any amount 
with respect to any loss arising out of fraud or misrepresentation for 
which the claiming Noteholder, is responsible or of which it had 
knowledge at the time it became a Noteholder.



Sec. 221.14  Transferability of Guarantee; Note Register.

    A Noteholder may assign, transfer or pledge an Eligible Note to any 
Person. Any such assignment, transfer or pledge shall be effective on 
the date that the name of the new Noteholder is entered on the Note 
Register required to be maintained by the Fiscal Agent pursuant to the 
Fiscal Agency Agreement. A.I.D. shall be entitled to treat the Persons 
in whose names the Eligible Notes are registered as the owners thereof 
for all purposes of this Guarantee and A.I.D. shall not be affected by 
notice to the contrary.



Sec. 221.15  Fiscal Agent obligations.

    Failure of the Fiscal Agent to perform any of its obligations 
pursuant to the Fiscal Agency Agreement shall not impair any 
Noteholder's rights under this Guarantee, but may be the subject of 
action for damages against the Fiscal Agent by A.I.D. as a result of 
such failure or neglect. A Noteholder may appoint the Fiscal Agent to 
make demand for payment on its behalf under this Guarantee.



             Subpart C--Procedure for Obtaining Compensation



Sec. 221.21  Event of Default; Application for Compensation; payment.

    At any time after an Event of Default, as this term is defined in an 
Eligible Note, any Noteholder hereunder, or the Fiscal Agent on behalf 
of a Noteholder hereunder, may file with A.I.D. an Application for 
Compensation in the form provided in exhibit A. A.I.D. shall pay or 
cause to be paid to any such Applicant any compensation specified in 
such Application for Compensation that is due to the Applicant pursuant 
to the Guarantee as a Loss of Investment not later than three (3) 
Business Days after the Date of Application. In the event that A.I.D. 
receives any other notice of an Event of Default, A.I.D. may pay any 
compensation that is due to any Noteholder pursuant to a Guarantee, 
whether or not such Noteholder has filed with A.I.D. an Application for 
Compensation in respect of such amount.



Sec. 221.22  No acceleration of Eligible Notes.

    Eligible Notes shall not be subject to acceleration by A.I.D., the 
Noteholder or any other party.



Sec. 221.23  Payment to A.I.D. of excess amounts received by a Noteholder.

    If a Noteholder shall, as a result of A.I.D. paying compensation 
under this Guarantee, receive an excess payment, it shall refund the 
excess to A.I.D.



Sec. 221.24  Subrogation of A.I.D.

    In the event of payment by A.I.D. to a Noteholder under this 
Guarantee, A.I.D. shall be subrogated to the extent of such payment to 
all of the rights of such Noteholder against the Borrower under the 
related Note.



                          Subpart D--Covenants



Sec. 221.31  Prosecution of claims.

    After payment by A.I.D. to an Applicant pursuant to Sec. 221.21, 
A.I.D. shall have exclusive power to prosecute all claims related to 
rights to receive payments under the Eligible Notes to which it is 
thereby subrogated. If a Noteholder continues to have an interest in the 
outstanding Eligible Notes, such a Noteholder and A.I.D. shall consult 
with each other with respect to their respective interests in such 
Eligible Notes and the manner of and responsibility for prosecuting 
claims.



Sec. 221.32  Change in agreements.

    No Noteholder will consent to any change or waiver of any provision 
of any document contemplated by this Guarantee without the prior written 
consent of A.I.D.

[[Page 790]]



                        Subpart E--Administration



Sec. 221.41  Arbitration.

    Any controversy or claim between A.I.D. and any noteholder arising 
out of this Guarantee shall be settled by arbitration to be held in 
Washington, DC in accordance with the then prevailing rules of the 
American Arbitration Association, and judgment on the award rendered by 
the arbitrators may be entered in any court of competent jurisdiction.



Sec. 221.42  Notice.

    Any communication to A.I.D. pursuant to this Guarantee shall be in 
writing in the English language, shall refer to the Israel Loan 
Guarantee Number inscribed on the Eligible Note and shall be complete on 
the day it shall be actually received by A.I.D. at the Office of Housing 
and Urban Programs, Bureau for Private Enterprise, Agency for 
International Development, Washington, DC 20523-0030. Other addresses 
may be substituted for the above upon the giving of notice of such 
substitution to each Noteholder by first class mail at the address set 
forth in the Note Register.



Sec. 221.43  Governing law.

    This Guarantee shall be governed by and construed in accordance with 
the laws of the United States of America governing contracts and 
commercial transactions of the United States Government.

          Appendix A to Part 221--Application for Compensation

[________________]
    Agency for International Development, International Development 
Cooperation Agency, Washington, DC 20523.
Ref: Guarantee dated as of ____________, 19____
Gentlemen:
    You are hereby advised that payment of $____________ (consisting of 
$____________ of principal, $____________ of interest and $____________ 
in Further Guaranteed Payments, as defined in Sec. 221.01(f) of the 
Standard Terms and Conditions of the above-mentioned Guarantee) 
[(consisting of $________ maturity amount and $________ in Further 
Guaranteed Payments, as defined in Sec. 221.01(f) of the Standard Terms 
and Conditions of the above-mentioned Guarantee)] \1\ was due on 
____________, 19 ____, on $____________ principal [maturity] \1\ amount 
of Notes held by the undersigned of the Government of Israel, on behalf 
of the State of Israel (the ``Borrower''). Of such amount $____________ 
was not received on such date and has not been received by the 
undersigned at the date hereof. In accordance with the terms and 
provisions of the above-mentioned Guarantee, the undersigned hereby 
applies, under Sec. 221.21 of said Guarantee, for payment of 
$____________, representing $____________, the principal amount of the 
presently outstanding Note(s) of the Borrower held by the undersigned 
that was due and payable on ____________ and that remains unpaid, and 
$____________, the interest amount on such Note(s) that was due and 
payable by the Borrower on ________ and that remains unpaid, 
[$____________, the maturity amount of such Note that was due and 
payable on ________________ and that remains unpaid] \2\ and 
$____________ in Further Guaranteed Payments,\3\ plus accrued and unpaid 
interest thereon from the date of default with respect to such payments 
to and including the date payment in full is made by you pursuant to 
said Guarantee, at the rate of ______% per annum, being the rate for 
such interest accrual specified in such Note. Such payment is to be made 
at [state payment instructions of Noteholder.]
---------------------------------------------------------------------------


    \1\ Alternate language for zero-coupon Eligible Notes.

    \2\ Alternate language for zero-coupon Eligible Notes.

    \3\ In the event the Application for Compensation relates to Further 
Guaranteed Payments, such Application must also contain a statement of 
the nature and circumstances of the related loss.

---------------------------------------------------------------------------
[Name of Applicant]

 By_____________________________________________________________________
 Name___________________________________________________________________
 Title__________________________________________________________________
 Dated__________________________________________________________________



PART 223--ADMINISTRATIVE ENFORCEMENT PROCEDURES OF POST-EMPLOYMENT RESTRICTIONS--Table of Contents




Sec.
223.1  General.
223.2  Report of violations.
223.3  Initiation of proceeding.
223.4  Examiner.
223.5  Agency representative.
223.6  Time, date and place of hearing.
223.7  Rights of parties at hearing.
223.8  Initial decision.
223.9  Appeal.

[[Page 791]]

223.10  Final decision.
223.11  Appropriate action.

    Authority:  18 U.S.C. 207.

    Source:  46 FR 55957, Nov. 13, 1981, unless otherwise noted.



Sec. 223.1  General.

    The following procedures are hereby established with respect to the 
administrative enforcement of restrictions on post-employment activities 
(18 U.S.C. 207 (a), (b) or (c)) and implementing regulations published 
by the Office of Government Ethics (5 CFR part 737).



Sec. 223.2  Report of violations.

    On receipt of information regarding a possible violation of the 
statutory or regulatory post-employment restrictions by a former 
employee and after determining that such information does not appear to 
be frivolous, the General Counsel shall provide such information to the 
Director of the Office of Government Ethics and to the Criminal 
Division, Department of Justice. Any investigation or administrative 
action shall be coordinated with the Department of Justice to avoid 
prejudicing possible criminal proceedings. If the Department of Justice 
informs the Agency that it does not intend to institute criminal 
proceedings, such coordination shall no longer be required and the 
General Counsel is free to decide whether to pursue administrative 
action.



Sec. 223.3  Initiation of proceeding.

    Whenever the General Counsel has reasonable cause to believe that a 
former Government employee has violated the statutory or regulatory 
post-employment restrictions, he or she shall initiate an administrative 
action by providing the former Government employee with written notice 
of intention to institute administrative action. Notice must include:
    (a) A statement of allegations and the basis thereof sufficiently 
detailed to enable the former Government employee to prepare an adequate 
defense;
    (b) Notification of the right to respond to the allegations in 
writing and/or to request a hearing, together with an explanation of the 
method by which a hearing may be requested; and
    (c) A statement that, in the absence of a request for a hearing, the 
General Counsel shall issue a final decision based upon the evidence 
gathered to date, including any written reply made by the former 
Government employee.



Sec. 223.4  Examiner.

    When a former Government employee after receiving adequate notice 
requests a hearing, a presiding official (hereinafter referred to as 
``examiner'') shall be appointed by the Administrator to make an initial 
decision. The examiner shall be a responsible person who is impartial 
and who has not participated in any manner in the decision to initiate 
the proceeding. The hearing officer shall be an individual with suitable 
experience and training to conduct the hearing, reach a determination 
and render an initial decision in an equitable manner.



Sec. 223.5  Agency representative.

    The General Counsel shall appoint an agency representative to 
present evidence and otherwise participate in the hearing.



Sec. 223.6  Time, date and place of hearing.

    The examiner shall establish a reasonable time, date and place to 
conduct the hearing. In establishing a date, the examiner shall give due 
regard to the former employee's need for:
    (a) Adequate time to prepare a defense properly, and
    (b) An expeditious resolution of allegations that may be damaging to 
his or her reputation.



Sec. 223.7  Rights of parties at hearing.

    A hearing shall include, at a minimum, the following rights for both 
parties:
    (a) To represent oneself or to be represented by counsel;
    (b) To examine or cross-examine witnesses;
    (c) To submit evidence (including the use of interrogatories);
    (d) To present oral arguments; and
    (e) To receive a transcript of recording of the proceedings on 
request.

In any hearing, the agency has the burden of proof and must establish 
substantial evidence of a violation.

[[Page 792]]



Sec. 223.8  Initial decision.

    The examiner shall issue an initial decision based exclusively on 
matters of record in the proceedings and shall set forth all findings of 
fact and conclusions of law relevant to the matters at issue.



Sec. 223.9  Appeal.

    Within twenty days of the date of initial decision, either party may 
appeal the decision to the Administrator. The opposing party shall have 
ten days after receipt of a copy of the appeal to reply.



Sec. 223.10  Final decision.

    (a) In cases where the former employee failed to request a hearing 
after receiving adequate notice, the General Counsel shall decide the 
matter on its merits based upon the evidence gathered to date, including 
any written reply of the former employee.
    (b) In cases of appeal under Sec. 223.9, the Administrator shall 
accept, reject or modify the initial decision based solely on the record 
of the proceedings or those portions cited by the parties to limit the 
issues.



Sec. 223.11  Appropriate action.

    The Administrator may take appropriate action in the case of any 
individual who is found in violation of the statutory or regulatory post 
employment restrictions after a final decision by:
    (a) Prohibiting the individual from making, on behalf of any other 
person (except the United States), any formal or informal appearance 
before, or with the intent to influence, any oral or written 
communication to, the Agency on any matter of business for a period not 
to exceed five years, which may be accomplished by directing Agency 
employees to refuse to participate in such appearance or to accept any 
such communication; and
    (b) Taking other appropriate disciplinary action.



PART 224--IMPLEMENTATION OF THE PROGRAM FRAUD CIVIL REMEDIES ACT--Table of Contents




Sec.
224.1  Basis and purpose.
224.2  Definitions.
224.3  Basis for civil penalties and assessments.
224.4  Investigation.
224.5  Review by the reviewing official.
224.6  Prerequisites for issuing a complaint.
224.7  Complaint.
224.8  Service of complaint.
224.9  Answer.
224.10  Default upon failure to file an answer.
224.11  Referral of complaint and answer to the ALJ.
224.12  Notice of hearing.
224.13  Parties to the hearing.
224.14  Separation of functions.
224.15  Ex parte contacts.
224.16  Disqualification of reviewing official or ALJ.
224.17  Rights of parties.
224.18  Authority of the ALJ.
224.19  Prehearing conferences.
224.20  Disclosure of documents.
224.21  Discovery.
224.22  Exchange of witness lists, statements, and exhibits.
224.23  Subpoenas for attendance at hearing.
224.24  Protective order.
224.25  Fees.
224.26  Form, filing and service of papers.
224.27  Computation of time.
224.28  Motions.
224.29  Sanctions.
224.30  The hearing and burden of proof.
224.31  Determining the amount of penalties and assessments.
224.32  Location of hearing.
224.33  Witnesses.
224.34  Evidence.
224.35  The record.
224.36  Post-hearing briefs.
224.37  Initial decision.
224.38  Reconsideration of initial decision.
224.39  Appeal to A.I.D. Administrator.
224.40  Stays ordered by the Department of Justice.
224.41  Stay pending appeal.
224.42  Judicial review.
224.43  Collection of civil penalties and assessments.
224.44  Right to administrative offset.
224.45  Deposit in Treasury of United States.
224.46  Compromise or settlement.
224.47  Limitations.

    Authority:  22 U.S.C. 2381; 31 U.S.C. 3801-3812.

    Source:  52 FR 45313, Nov. 27, 1987, unless otherwise noted.



Sec. 224.1  Basis and purpose.

    (a) Basis. This part implements the Program Fraud Civil Remedies Act 
of 1986, Pub. L. 99-509, sections 6101-6104, 100 Stat. 1874 (October 21, 
1986), to be

[[Page 793]]

codified at 31 U.S.C. 3801-3812. 31 U.S.C. 3809 of the Statute requires 
each authority head to promulgate regulations necessary to implement to 
provisions of the statute.
    (b) Purpose. This part (1) establishes administrative procedures for 
imposing civil penalties and assessments against persons who make, 
submit, or present, or cause to be made, submitted, or presented, false, 
fictitious, or fraudulent claims or written statements to the Agency for 
International Development or to its agents, and (2) specifies the 
hearing and appeal rights of persons subject to allegations of liability 
for such penalties and assessments.



Sec. 224.2  Definitions.

    A.I.D. means the Agency for International Development.
    ALJ means an Administrative Law Judge in the authority appointed 
pursuant to 5 U.S.C. 3105 or detailed to the authority pursuant to 5 
U.S.C. 3344.
    Benefit means, in the context of ``statement,'' anything of value, 
including but not limited to any advantage, preference, privilege, 
license, permit, favorable decision, ruling, status, or loan guarantee.
    Claim means any request, demand, or submission--
    (a) Made to A.I.D. for property, services, or money (including money 
representing grants, loans, insurance, or benefits);
    (b) Made to a recipient of property, services, or money from A.I.D. 
or to a party to a contract with A.I.D.--
    (1) For property or services if the United States--
    (i) Provided such property or services;
    (ii) Provided any portion of the funds for the purchase of such 
property or services; or
    (iii) Will reimburse such recipient or party for the purchase of 
such property or services; or
    (2) For the payment of money (including money representing grants, 
loans, insurance, or benefits) if the United States--
    (i) Provided any portion of the money requested or demanded; or
    (ii) Will reimburse such recipient or party for any portion of the 
money paid on such request or demand; or
    (c) Made to A.I.D. which has the effect of decreasing an obligation 
to pay or account for property, services, or money.
    Complaint means the administrative complaint served by the reviewing 
official on the defendant under Sec. 224.7.
    Defendant means any person alleged in a complaint under Sec. 224.7 
to be liable for a civil penalty or assessment under Sec. 224.3.
    Government means the United States Government.
    Individual means a natural person.
    Initial decision means the written decision of the ALJ required by 
Sec. 224.10 or Sec. 224.37, and includes a revised initial decision 
issued following a remand or a motion for reconsideration.
    Investigating official means the Inspector General for A.I.D. or an 
officer or employee of the Office of Inspector General designated by the 
Inspector General and serving in a position for which the rate of basic 
pay is not less than the minimum rate of basic pay for grade GS-16 under 
the General Schedule.
    Knows or has reason to know, means that a person, with respect to a 
claim or statement--
    (a) Has actual knowledge that the claim or statement is false, 
fictitious, or fraudulent;
    (b) Acts in deliberate ignorance of the truth or falsity of the 
claim or statement; or
    (c) Acts in reckless disregard of the truth or falsity of the claim 
or statement.
    Makes, wherever it appears, shall include the terms presents, 
submits, and causes to be made, presented, or submitted. As the context 
requires, making or made, shall likewise include the corresponding forms 
of such terms.
    Person means any individual, partnership, corporation, association, 
or private organization and includes the plural of that term.
    Representative means an attorney who is a member in good standing of 
the bar of any State, Territory, or possession of the United States or 
the District of Columbia or the Commonwealth of Puerto Rico.
    Reviewing official means the General Counsel of A.I.D. or his 
designee who is:

[[Page 794]]

    (a) Not subject to supervision by, or required to report to, the 
investigating official;
    (b) Not employed in the organizational unit of A.I.D. in which the 
investigating official is employed; and
    (c) Is serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16 under the 
General Schedule.
    Statement means any representation, certification, affirmation, 
document, record, or accounting or bookkeeping entry made--
    (a) With respect to a claim or to obtain the approval or payment of 
a claim (including relating to eligibility to make a claim); or
    (b) With respect to (including relating to eligibility for)--
    (1) A contract with, or a bid or proposal for a contract with; or
    (2) A grant, loan, or benefit from, A.I.D., or any State, political 
subdivision of a State, or other party, if the United States Government 
provides any portion of the money or property under such contract or for 
such grant, loan, or benefit, or if the Government will reimburse such 
State, political subdivision, or party for any portion of the money or 
property under such contract or for such grant, loan, or benefit.



Sec. 224.3  Basis for civil penalties and assessments.

    (a) Claims (1) Any person who makes a claim that the person knows or 
has reason to know--
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which asserts 
a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that--
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and
    (C) Is a statement in which the person making such statement has a 
duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed;

shall be subject, in addition to any other remedy that may be prescribed 
by law, to a civil penalty of not more than $5,000 for each such claim.
    (2) Each voucher, invoice, claim form, or other individual request 
or demand for property, services, or money constitutes a separate claim.
    (3) A claim shall be considered made to A.I.D., a recipient, or 
party when such claim is actually made to an agent, fiscal intermediary, 
or other entity, including any State or political subdivision thereof, 
acting for or on behalf of A.I.D. or such recipient or party.
    (4) Each claim for property, services, or money is subject to a 
civil penalty regardless of whether such property, services, or money is 
actually delivered or paid.
    (5) If the Government has made any payment (including transferred 
property or provided services) on a claim, a person subject to a civil 
penalty under paragraph (a)(1) of this section shall also be subject to 
an assessment of not more than twice the amount of such claim or that 
portion thereof that is determined to be in violation of paragraph 
(a)(1) of this section. Such assessment shall be in lieu of damages 
sustained by the Government because of such claim.
    (b) Statements. (1) Any person who makes a written statement that--
    (i) The person knows or has reason to know--
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a material 
fact that the person making the statement had a duty to include in such 
statement; and
    (ii) Contains or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the contents of the 
statement,

shall be subject, in addition to any other remedy and may be prescribed 
by law, to a civil penalty of not more than $5,000 for each such 
statement.
    (2) Each written representation, certification, or affirmation 
constitutes a separate statement.
    (3) A statement shall be considered made to A.I.D. when such 
statement is actually made to an agent, fiscal intermediary, or other 
entity, including any State or political subdivision thereof, acting for 
or on behalf of A.I.D.

[[Page 795]]

    (c) No proof of specific intent to defraud is required to establish 
liability under this section.
    (d) In any case in which it is determined that more than one person 
is liable for making a claim or statement under this section, each such 
person may be held liable for a civil penalty under this section.
    (e) In any case in which it is determined that more than one person 
is liable for making a claim under this section on which the Government 
has made payment (including transferred property or provided services), 
an assessment may be imposed against any such person or jointly and 
severally against any combination of such persons.



Sec. 224.4  Investigation.

    (a) If an investigating official concludes that a subpoena pursuant 
to the authority conferred by 31 U.S.C. 3804(a) is warranted--
    (1) The subpoena so issued shall notify the person to whom it is 
addressed of the authority under which the subpoena is issued, and shall 
identify the records of documents sought;
    (2) The investigating official may designate a person to act on his 
or her behalf to receive the documents sought; and
    (3) The person receiving such subpoena shall be required to tender 
to the investigating official or the person designated to receive the 
documents a certification that the documents sought have been produced, 
or that such documents are not available and the reasons therefore, or 
that such documents, suitably identified, have been withheld based upon 
the assertion of an identified privilege.
    (b) If the investigating official concludes that an action under the 
Program Fraud Civil Remedies Act may be warranted, the investigating 
official shall submit a report containing the findings and conclusions 
of such investigation to the reviewing official.
    (c) Nothing in this section shall preclude or limit an investigating 
official's discretion to refer allegations directly to the Department of 
Justice for suit under the False Claims Act or other civil relief, or to 
defer or postpone a report or referral to the reviewing official to 
avoid interference with a criminal investigation or prosecution.
    (d) Nothing in this section modifies any responsibility of an 
investigating official to report violations of criminal law to the 
Attorney General.



Sec. 224.5  Review by the reviewing official.

    (a) If, based on the report of the investigating official under 
Sec. 224.4(b), the reviewing official determines that there is adequate 
evidence to believe that a person is liable under Sec. 224.3 of this 
part, the reviewing official shall transmit to the Attorney General a 
written notice of the reviewing official's intention to issue a 
complaint under Sec. 224.7.
    (b) Such notice shall include--
    (1) A statement of the reviewing official's reasons for issuing a 
complaint;
    (2) A statement specifying the evidence that supports the 
allegations of liability;
    (3) A description of the claims or statements upon which the 
allegations of liability are based;
    (4) An estimate of the amount of money or the value of property, 
services, or other benefits requested or demanded in violation of 
Sec. 224.3 of this part;
    (5) A statement of any exculpatory or mitigating circumstances that 
may relate to the claims or statements known by the reviewing official 
or the investigating official; and
    (6) A statement that there is a reasonable prospect of collecting an 
appropriate amount of penalties and assessments.



Sec. 224.6  Prerequisites for issuing a complaint.

    (a) The reviewing official may issue a complaint under Sec. 224.7 
only if:
    (1) The Department of Justice approves the issuance of a complaint 
in a written statement described in 31 U.S.C. 3803(b)(1); and
    (2) In the case of allegations of liability under Sec. 224.3(a) with 
respect to a claim, the reviewing official determines that, with respect 
to such claim or a group of related claims submitted at the same time 
such claim is submitted (as defined in paragraph (b) of this section), 
the amount of money or the

[[Page 796]]

value of property or services demanded or requested in violation of 
Sec. 224.3(a) does not exceed $150,000.
    (b) For the purposes of this section, a related group of claims 
submitted at the same time shall include only those claims arising from 
the same transaction (e.g., grant, loan, application, or contract) that 
are submitted simultaneously as part of a single request, demand, or 
submission.
    (c) Nothing in this section shall be construed to limit the 
reviewing official's authority to join in a single complaint against a 
person claims that are unrelated or were not submitted simultaneously, 
regardless of the amount of money, or the value of property or services, 
demanded or requested.



Sec. 224.7  Complaint.

    (a) On or after the date the Department of Justice approves the 
issuance of a complaint in accordance with 31 U.S.C. 3803(b)(1), the 
reviewing official may serve a complaint on the defendant, as provided 
in Sec. 224.8.
    (b) The complaint shall state:
    (1) Allegations of liability against the defendant, including the 
statutory basis for liability, an identification of the claims or 
statements that are the basis for the alleged liability, and the reasons 
why liability allegedly arises from such claims or statements;
    (2) The maximum amount of penalties and assessments for which the 
defendant may be held liable;
    (3) Instructions for filing an answer to request a hearing, 
including a specific statement of the defendant's right to request a 
hearing by filing an answer and to be represented by a representative; 
and
    (4) That failure to file an answer within 30 days of service of the 
complaint will result in the imposition of the maximum amount of 
penalties and assessments without right to appeal, as provided in 
Sec. 224.10.
    (c) At the same time the reviewing official serves the complaint, he 
or she shall serve the defendant with a copy of these regulations.



Sec. 224.8  Service of complaint.

    (a) Service of a complaint must be made by certified or registered 
mail or by delivery in any manner authorized by Rule 4(d) of the Federal 
Rules of Civil Procedure. Service is complete upon receipt.
    (b) Proof of service, stating the name and address of the person on 
whom the complaint was served, and the manner and date of service, may 
be made by:
    (1) Affidavit of the individual serving the complaint by delivery;
    (2) A United States Postal Service return receipt card acknowledging 
receipt; or
    (3) Written acknowledgment of receipt by the defendant or his 
representative.



Sec. 224.9  Answer.

    (a) The defendant may request a hearing by filing an answer with the 
reviewing official within 30 days of service of the complaint. An answer 
shall be deemed to be a request for hearing.
    (b) In the answer, the defendant:
    (1) Shall admit or deny each of the allegations of liability made in 
the complaint;
    (2) Shall state any defense on which the defendant intends to rely;
    (3) May state any reasons why the defendant contends that the 
penalties and assessments should be less than the statutory maximum; and
    (4) Shall state the name, address, and telephone number of the 
person authorized by the defendant to act as defendant's representative, 
if any.
    (c) If the defendant is unable to file an answer meeting the 
requirements of paragraph (b) of this section within the time provided, 
the defendant may, before the expiration of 30 days from service of the 
complaint, file with the reviewing official a general answer denying 
liability and requesting a hearing, and a request for an extension of 
time within which to file an answer meeting the requirements of 
paragraph (b) of this section. The reviewing official shall file 
promptly with the ALJ the complaint, the general answer denying 
liability, and the request for an extension of time as provided in 
Sec. 224.11. For good cause shown, the ALJ may grant the defendant up to 
30 additional days within which to file an answer meeting the 
requirements of paragraph (b) of this section.

[[Page 797]]



Sec. 224.10  Default upon failure to file an answer.

    (a) If the defendant does not file an answer within the time 
prescribed in Sec. 224.9(a), the reviewing official may refer the 
complaint to the ALJ.
    (b) Upon the referral of the complaint, the ALJ shall promptly serve 
on defendant in the manner prescribed in Sec. 224.8, a notice that an 
initial decision will be issued under this section.
    (c) The ALJ shall assume the facts alleged in the complaint to be 
true, and, if such facts establish liability under Sec. 224.3, the ALJ 
shall issue an initial decision imposing the maximum amount of penalties 
and assessments allowed under the statute.
    (d) Except as otherwise provided in this section, by failing to file 
a timely answer, the defendant waives any right to further review of the 
penalties and assessments imposed under paragraph (c) of this section, 
and the initial decision shall become final and binding upon the parties 
30 days after it is issued.
    (e) If, before such an initial decision becomes final, the defendant 
files a motion with the ALJ seeking to reopen on the grounds that 
extraordinary circumstances prevented the defendant from filing an 
answer, the initial decision shall be stayed pending the ALJ's decision 
on the motion.
    (f) If, on such motion, the defendant can demonstrate extraordinary 
circumstances excusing the failure to file a timely answer the ALJ shall 
withdraw the initial decision in paragraph (c) of this section, if such 
a decision has been issued, and shall grant the defendant an opportunity 
to answer the complaint.
    (g) A decision of the ALJ denying defendant's motion under paragraph 
(e) of this section is not subject to reconsideration under Sec. 224.38.
    (h) The defendant may appeal to the A.I.D. Administrator the 
decision denying a motion to reopen by filing a notice of appeal with 
the A.I.D. Administrator within 15 days after the ALJ denies the motion. 
The timely filing of a notice of appeal shall stay the initial decision 
until the A.I.D. Administrator decides the issue.
    (i) If the defendant files a timely notice of appeal with the A.I.D. 
Administrator, the ALJ shall forward the record of the proceeding to the 
A.I.D. Administrator.
    (j) The A.I.D. Administrator shall decide expeditiously whether 
extraordinary circumstances excuse the defendant's failure to file a 
timely answer based solely on the record before the ALJ.
    (k) If the A.I.D. Administrator decides that extraordinary 
circumstances excused the defendant's failure to file a timely answer, 
the A.I.D. Administrator shall remand the case to the ALJ with 
instructions to grant the defendant an opportunity to answer.
    (l) If the A.I.D. Administrator decides that the defendant's failure 
to file a timely answer is not excused, the A.I.D. Administrator shall 
reinstate the initial decision of the ALJ, which shall become final and 
binding upon the parties 30 days after the A.I.D. Administrator issues 
such decision.



Sec. 224.11  Referral of complaint and answer to the ALJ.

    Upon receipt of an answer, the reviewing official shall file the 
complaint and answer with the ALJ.



Sec. 224.12  Notice of hearing.

    (a) When the ALJ receives the complaint and answer, the ALJ shall 
promptly serve a notice of hearing upon the defendant in the manner 
prescribed by Sec. 224.8. At the same time, the ALJ shall send a copy of 
such notice to the representative for the Government.
    (b) Such notice shall include:
    (1) The tentative time and place, and the nature of the hearing;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The matters of fact and law to be asserted;
    (4) A description of the procedures for the conduct of the hearing;
    (5) The name, address, and telephone number of the representative of 
the Government and of the defendant, if any; and
    (6) Such other matters as the ALJ deems appropriate.



Sec. 224.13  Parties to the hearing.

    (a) The parties to the hearing shall be the defendant and A.I.D.

[[Page 798]]

    (b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the 
False Claims Act may participate in these proceedings to the extent 
authorized by the provisions of that Act.



Sec. 224.14  Separation of functions.

    (a) The investigating official, the reviewing official, and any 
employee or agent of A.I.D. who takes part in investigating, preparing, 
or presenting a particular case may not, in such case or a factually 
related case:
    (1) Participate in the hearing as the ALJ;
    (2) Participate or advise in the initial decision or the review of 
the initial decision by the A.I.D. Administrator, except as a witness or 
representative in public proceedings; or
    (3) Make the collection of penalties and assessments under 31 U.S.C. 
3806.
    (b) The ALJ shall not be responsible to, or subject to, the 
supervision or direction of the investigating official or the reviewing 
official.
    (c) Except as provided in paragraph (a) of this section, the 
representative for the Government may be employed anywhere in A.I.D., 
including in the offices of either the investigating official or the 
reviewing official.



Sec. 224.15  Ex parte contacts.

    No party or person (except employees of the ALJ's office) shall 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking routine questions concerning administrative 
functions or procedures.



Sec. 224.16  Disqualification of reviewing official or ALJ.

    (a) A reviewing official or ALJ in a particular case may disqualify 
himself or herself at any time.
    (b) A party may file with the ALJ a motion for disqualification of a 
reviewing official or ALJ. Such motion shall be accompanied by an 
affidavit alleging personal bias or other reason for disqualification.
    (c) Such motion and affidavit shall be filed promptly upon the 
party's discovery of reasons requiring disqualification, or such 
objections shall be deemed waived.
    (d) Such affidavit shall state specific facts that support the 
party's belief that personal bias or other reason for disqualification 
exists and the time and circumstances of the party's discovery of such 
facts. It shall be accompanied by a certificate of the representative of 
record that it is made in good faith.
    (e) Upon the filing of such a motion and affidavit, the ALJ shall 
proceed no further in the case until he or she resolves the matter of 
disqualification in accordance with paragraph (f) of this section.
    (f)(1) If the ALJ determines that the reviewing official is 
disqualified, the ALJ shall dismiss the complaint without prejudice.
    (2) If the ALJ disqualifies himself or herself, the case shall be 
reassigned promptly to another ALJ.
    (3) If the ALJ denies a motion to disqualify, the A.I.D. 
Administrator may determine the matter only as part of his or her review 
of the initial decision upon appeal, if any.



Sec. 224.17  Rights of parties.

    Except as otherwise limited by this part, all parties may:
    (a) Be accompanied, represented, and advised by a representative;
    (b) Participate in any conference held by the ALJ;
    (c) Conduct discovery;
    (d) Agree to stipulations of fact or law, which shall be made part 
of the record;
    (e) Present evidence relevant to the issues at the hearing;
    (f) Present and cross-examine witnesses;
    (g) Present oral arguments at the hearing as permitted by the ALJ; 
and
    (h) Submit written briefs and proposed findings of fact and 
conclusions of law after the hearing.



Sec. 224.18  Authority of the ALJ.

    (a) The ALJ shall conduct a fair and impartial hearing, avoid delay, 
maintain order, and assure that a record of the proceeding is made.
    (b) The ALJ may:

[[Page 799]]

    (1) Set and change the date, time, and place of the hearing upon 
reasonable notice to the parties;
    (2) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (3) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (4) Adminster oaths and affirmations;
    (5) Issue subpoenas requiring the attendance of witnesses and the 
production of documents at depositions or at hearings;
    (6) Rule on motions and other procedural matters;
    (7) Regulate the scope and timing of discovery;
    (8) Regulate the course of the hearing and the conduct of 
representatives and parties;
    (9) Examine witnesses;
    (10) Receive, rule on, exclude, or limit evidence;
    (11) Upon motion of a party, take official notice of facts;
    (12) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment where there is no disputed issue of material fact;
    (13) Conduct any conference, argument, or hearing on motions in 
person or by telephone; and
    (14) Exercise such other authority as is necessary to carry out the 
responsibilities of the ALJ under this part.
    (c) The ALJ does not have the authority to find Federal statutes or 
regulations invalid.



Sec. 224.19  Prehearing conferences.

    (a) The ALJ may schedule prehearing conferences as appropriate.
    (b) Upon the motion of any party, the ALJ shall schedule at least 
one prehearing conference at a reasonable time in advance of the 
hearing.
    (c) The ALJ may use prehearing conferences to discuss the following:
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations and admissions of fact or as to the contents and 
authenticity of documents;
    (4) Whether the parties can agree to submission of the case on a 
stipulated record;
    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument;
    (6) Limitation of the number of witnesses;
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (8) Discovery;
    (9) The time and place for the hearing; and
    (10) Such other matters as may tend to expedite the fair and just 
disposition of the proceedings.
    (d) The ALJ shall issue an order containing all matters agreed upon 
by the parties or ordered by the ALJ at a prehearing conference.



Sec. 224.20  Disclosure of documents.

    (a) Upon written request to the reviewing official, the defendent 
may review any relevant and material documents, transcripts, records, 
and other materials that relate to the allegations set out in the 
complaint and upon which the findings and conclusions of the 
investigating official under Sec. 224.4(b) are based, unless such 
documents are subject to a privilege under Federal law. Upon payment of 
fees for duplication, the defendant may obtain copies of such documents.
    (b) Upon written request to the reviewing official, the defendant 
also may obtain a copy of all exculpatory information in the possession 
of the reviewing official or investigating official relating to the 
allegations in the complaint, even if it is contained in a document that 
would otherwise be privileged. If the document would otherwise be 
privileged, only that portion containing exculpatory information must be 
disclosed.
    (c) The notice sent to the Attorney General from the reviewing 
official as described in Sec. 224.5 is not discoverable under any 
circumstances.
    (d) The defendant may file a motion to compel disclosure of the 
documents subject to the provisions of this section. Such a motion may 
only be filed

[[Page 800]]

with the ALJ following the filing of an answer pursuant to Sec. 224.9.



Sec. 224.21  Discovery.

    (a) The following types of discovery are authorized:
    (1) Requests for production of documents for inspection and copying;
    (2) Requests for admissions of the authenticity of any relevant 
document or the truth of any relevant fact;
    (3) Written interrogatories; and
    (4) Depositions.
    (b) For the purpose of this section and Sec. 224.22 and Sec. 224.23, 
the term ``documents'' includes information, documents, reports, 
answers, records, accounts, papers, and other data and documentary 
evidence. Nothing contained herein shall be interpreted to require the 
creation of a document.
    (c) Unless mutually agreed to by the parties, discovery is available 
only as ordered by the ALJ. The ALJ shall regulate the timing of 
discovery.
    (d) Motions for discovery. (1) A party seeking discovery may file a 
motion with the ALJ. Such a motion shall be accompanied by a copy of the 
requested discovery, or in the case of depositions, a summary of the 
scope of the proposed deposition.
    (2) Within ten days of service a party may file an opposition to the 
motion and/or a motion for protective order as provided in Sec. 224.24.
    (3) The ALJ may grant a motion for discovery only if he finds that 
the discovery sought:
    (i) Is necessary for the expeditious, fair, and reasonable 
consideration of the issues;
    (ii) Is not unduly costly or burdensome;
    (iii) Will not unduly delay the proceeding; and
    (iv) Does not seek privileged information.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.
    (5) The ALJ may grant discovery subject to a protective order under 
Sec. 224.24.
    (e) Deposition. (1) If a motion for deposition is granted, the ALJ 
shall issue a subpoena for the deponent, which may require the deponent 
to produce documents. The subpoena shall specify the time and place at 
which the deposition will be held.
    (2) The party seeking to depose shall serve the subpoena in the 
manner prescribed in Sec. 224.8.
    (3) The deponent may file with the ALJ a motion to quash the 
subpoena or a motion for a protective order within ten days of service.
    (4) The party seeking to depose shall provide for the taking of a 
verbatim transcript of the deposition which it shall make available to 
all other parties for inspection and copying.
    (f) Each party shall bear its own costs of discovery.



Sec. 224.22  Exchange of witness lists, statements, and exhibits.

    (a) At least 15 days before the hearing or at such other time as may 
be ordered by the ALJ, the parties shall exchange witness lists, copies 
of prior statements of proposed witnesses, copies of proposed hearing 
exhibits, including copies of any written statements that the party 
intends to offer in lieu of live testimony in accordance with 
Sec. 224.33(b). At the time the above documents are exchanged, any party 
that intends to rely on the transcript of deposition testimony in lieu 
of live testimony at the hearing, if permitted by the ALJ, shall provide 
each party with a copy of the specific pages of the transcript it 
intends to introduce into evidence.
    (b) If a party objects, the ALJ shall not admit into evidence the 
testimony of any witness whose name does not appear on the witness list 
or any exhibit not provided to the opposing party as provided above 
unless the ALJ finds good cause for the failure or that there is no 
prejudice to the objecting party.
    (c) Unless another party objects within the time set by the ALJ, 
documents exchanged in accordance with paragraph (a) of this section 
shall be deemed to be authentic for the purpose of admissibility at the 
hearing.



Sec. 224.23  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may request that the ALJ issue a subpoena.

[[Page 801]]

    (b) A subpoena requiring the attendance and testimony of an 
individual may also require the individual to produce documents at the 
hearing.
    (c) A party seeking a subpoena shall file a written request 
therefore not less than 15 days before the date fixed for the hearing 
unless otherwise allowed by the ALJ for good cause shown. Such request 
shall specify any documents to be produced and shall designate the 
witnesses and describe the address and location thereof with sufficient 
particularity to permit such witnesses to be found.
    (d) The subpoena shall specify the time and place at which the 
witness is to appear and any documents the witness is to produce.
    (e) The party seeking the subpoena shall serve it in the manner 
prescribed in Sec. 224.8. A subpoena on a party or upon an individual 
under the control of a party may be served by first-class mail.
    (f) A party or individual to whom the subpoena is directed may file 
with the ALJ a motion to quash the subpoena within ten days after 
service or on or before the time specified in the subpoena for 
compliance if it is less than ten days after service.



Sec. 224.24  Protective order.

    (a) A party or a prospective witness or deponent may file a motion 
for a protective order with respect to discovery sought by an opposing 
party or, with respect to the hearing, seeking to limit the availability 
or disclosure of evidence.
    (b) In issuing a protective order, the ALJ may make any order which 
justice requires to protect a party or person from annoyance, 
embarrassment, oppression, or undue burden or expense, including one or 
more of the following:
    (1) That the discovery not be had;
    (2) That the discovery may be had only on specified terms and 
conditions, including a designation of the time or place;
    (3) That the discovery may be had only through a method of discovery 
other than that requested;
    (4) That certain matters not be inquired into, or that the scope of 
discovery be limited to certain matters;
    (5) That discovery be conducted with no one present except persons 
designated by the ALJ;
    (6) That the contents of discovery or evidence be sealed;
    (7) That a deposition after being sealed be opened only by order of 
the ALJ;
    (8) That a trade secret or other confidential research, development, 
commercial information, or facts pertaining to any criminal 
investigation, proceeding or other administrative investigation not be 
disclosed or be disclosed only in a designated way; or
    (9) That the parties simultaneously file specified documents or 
information enclosed in sealed envelopes to be opened as directed by the 
ALJ.



Sec. 224.25  Fees.

    The party requesting a subpoena shall pay the cost of the fee and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in the United States District Court. A 
check for witness fees and mileage shall accompany the subpoena when 
served, except that when a subpoena is issued on behalf of A.I.D., a 
check for witness fees and mileage need not accompany the subpoena.



Sec. 224.26  Form, filing and service of papers.

    (a) Form. (1) Documents filed with the ALJ shall include an original 
and two copies.
    (2) Every pleading and paper filed in the proceeding shall contain a 
caption setting forth the title of the action, the case number assigned 
by the ALJ, and a designation of the paper (e.g., motion to quash 
subpoena).
    (3) Every pleading and paper shall be signed by, and shall contain 
the address and telephone number of the party or the person on whose 
behalf the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed. Date of 
mailing may be established by a certificate from the party or its 
representative or by proof that the document was sent by certified or 
registered mail.

[[Page 802]]

    (b) Service. A party filing a document with the ALJ shall, at the 
time of filing, serve a copy of such document on every other party. 
Service upon any party of any document other than those required to be 
served as prescribed in Sec. 224.8, shall be made by delivering a copy 
or by placing a copy of the document in the United States mail, postage 
prepaid and addressed, to the party's last known address. When a party 
is represented by a representative, service shall be made upon such 
representative in lieu of the actual party.
    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, shall be proof of service.



Sec. 224.27  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued thereunder, the time begins with the day following the act, 
event, or default, and includes the last day of the period, unless it is 
a Saturday, Sunday, or legal holiday observed by the Federal government, 
in which event it includes the next business day.
    (b) When the period of time allowed is less than seven days, 
intermediate Saturdays, Sundays, and legal holidays observed by the 
Federal government shall be excluded from the computation.
    (c) Where a document has been served or issued by placing it in the 
mail, an additional five days will be added to the time permitted for 
any response.



Sec. 224.28  Motions.

    (a) Any application to the ALJ for an order or ruling shall be by 
motion. Motions shall state the relief sought, the authority relied 
upon, and the facts alleged, and shall be filed with the ALJ and served 
on all other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions shall be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 15 days after a written motion is served, or such other 
times as may be fixed by the ALJ, any party may file a response to such 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses thereto has expired, except upon consent of the parties 
or following a hearing on the motion, but may overrule or deny such 
motion without awaiting a response.
    (e) The ALJ shall make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.



Sec. 224.29  Sanctions.

    (a) The ALJ may sanction a person, including any party or 
representative for:
    (1) Failing to comply with an order, rule, or procedure governing 
the proceeding;
    (2) Failing to prosecute or defend an action; or
    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Any such sanction, including but not limited to those listed in 
paragraphs (c), (d), and (e) of this section, shall reasonably relate to 
the severity and nature of the failure or misconduct.
    (c) When a party fails to comply with an order, including an order 
for taking a deposition, the production of evidence within the party's 
control, or a request for admission, the ALJ may:
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) In the case of requests for admission, deem each matter of which 
an admission is requested to be admitted;
    (3) Prohibit the party failing to comply with such order from 
introducing evidence concerning, or otherwise relying upon, testimony 
relating to the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with such request.
    (d) If a party fails to prosecute or defend an action under this 
part commenced by service of a notice of hearing, the ALJ may dismiss 
the action or may issue an initial decision imposing penalties and 
assessments.
    (e) The ALJ may refuse to consider any motion, request, response, 
brief or other document which is not filed in a timely fashion.

[[Page 803]]



Sec. 224.30  The hearing and burden of proof.

    (a) The ALJ shall conduct a hearing on the record in order to 
determine whether the defendant is liable for a civil penalty or 
assessment under Sec. 224.3, and if so, the appropriate amount of any 
such civil penalty or assessment considering any aggravating or 
mitigating factors.
    (b) A.I.D. shall prove defendant's liability and any aggravating 
factors by a preponderance of the evidence.
    (c) The defendant shall prove any affirmative defenses and any 
mitigating factors by a preponderance of the evidence.
    (d) The hearing shall be open to the public unless otherwise ordered 
by the ALJ for good cause shown.



Sec. 224.31  Determining the amount of penalties and assessments.

    (a) In determining an appropriate amount of civil penalties and 
assessments, the ALJ and the A.I.D. Administrator, upon appeal, should 
evaluate any circumstances that mitigate or aggravate the violation and 
should articulate in their opinions the reasons that support the 
penalties and assessments they impose. Because of the intangible costs 
of fraud, the expense of investigating such conduct, and the need to 
deter others who might be similarly tempted, ordinarily double damages 
and a significant civil penalty should be imposed.
    (b) Although not exhaustive, the following factors are among those 
that may influence the ALJ and the A.I.D. Administrator in determining 
the amount of penalties and assessments to impose with respect to the 
misconduct (i.e., the false, fictitious, or fraudulent claims or 
statements) charged in the complaint:
    (1) The number of false, fictitious, or fraudulent claims or 
statements;
    (2) The time period over which such claims or statements were made;
    (3) The degree of the defendant's culpability with respect to the 
misconduct;
    (4) The amount of money or the value of the property, services, or 
benefit falsely claimed;
    (5) The value of the Government's actual loss as a result of the 
misconduct, including foreseeable consequential damages and the costs of 
investigation;
    (6) The relationship of the amount imposed as civil penalties to the 
amount of the Government's loss;
    (7) The potential or actual impact of the misconduct upon national 
defense, public health or safety, or public confidence in the management 
of Government programs and operations, including particularly the impact 
on the intended beneficiaries of such programs;
    (8) Whether the defendant has engaged in a pattern of the same or 
similar misconduct;
    (9) Whether the defendant attempted to conceal the misconduct;
    (10) The degree to which the defendant has involved others in the 
misconduct or in concealing it;
    (11) Where the misconduct of employees or agents is imputed to the 
defendant, the extent to which the defendant's practices fostered or 
attempted to preclude such misconduct;
    (12) Whether the defendant cooperated in or obstructed an 
investigation of the misconduct;
    (13) Whether the defendant assisted in identifying and prosecuting 
other wrongdoers;
    (14) The complexity of the program or transaction, and the degree of 
the defendant's sophistication with respect to it, including the extent 
of defendant's prior participation in the program or in similar 
transactions;
    (15) Whether the defendant has been found, in any criminal, civil, 
or administrative proceeding, to have engaged in similar misconduct or 
to have dealt dishonestly with the Government of the United States or of 
a State, directly or indirectly; and
    (16) The need to deter the defendant and others from engaging in the 
same or similar misconduct.
    (c) Nothing in this section shall be construed to limit the ALJ or 
the A.I.D. Administrator from considering any other factors that in any 
given case may mitigate or aggravate the offense for which penalties and 
assessments are imposed.



Sec. 224.32  Location of hearing.

    (a) The hearing may be held:

[[Page 804]]

    (1) In any judicial district of the United States in which the 
defendant resides or transacts business;
    (2) In any judicial district of the United States in which the claim 
or statement in issue was made; or
    (3) In such other place as may be agreed upon by the defendant and 
the ALJ.
    (b) Each party shall have the opportunity to present argument with 
respect to the location of the hearing.
    (c) The hearing shall be held at the place and at the time ordered 
by the ALJ.



Sec. 224.33  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing shall be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony may be admitted in the 
form of a written statement or deposition. Any such written statement 
must be provided to all other parties along with the last known address 
of such witness, in a manner which allows sufficient time for other 
parties to subpoena such witness for cross-examination at the hearing. 
Prior written statements of witnesses proposed to testify at the hearing 
and deposition transcripts shall be exchanged as provided in 
Sec. 224.22(a).
    (c) The ALJ shall exercise reasonable control over the mode and 
order of interrogating witnesses and presenting evidence so as to--
    (1) Make the interrogation and presentation effective for the 
ascertainment of the truth,
    (2) Avoid needless consumption of time, and
    (3) Protect witnesses from harassment or undue embarrassment.
    (d) The ALJ shall permit the parties to conduct such cross-
examination as may be required for a full and true disclosure of the 
facts.
    (e) At the discretion of the ALJ, a witness may be cross-examined on 
matters relevant to the proceeding without regard to the scope of his or 
her direct examination. To the extent permitted by the ALJ cross-
examination on matters outside the scope of direct examination shall be 
conducted in the manner of direct examination and may proceed by leading 
questions only if the witness is a hostile witness, an adverse party, or 
a witness identified with an adverse party.
    (f) Upon motion of any party, the ALJ shall order witnesses excluded 
so that they cannot hear the testimony of other witnesses. This rule 
does not authorize exclusion of:
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party appearing for the entity pro se or designated by 
the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an individual employed by the 
Government engaged in assisting the representative for the Government.



Sec. 224.34  Evidence.

    (a) The ALJ shall determine the admissibility of evidence.
    (b) Except as provided in this part, the ALJ shall not be bound by 
the Federal Rules of Evidence. However, the ALJ may apply the Federal 
Rules of Evidence, where appropriate, e g., to exclude unreliable 
evidence.
    (c) The ALJ shall exclude irrelevant and immaterial evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighed by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence may be excluded if it is privileged 
under Federal law.
    (f) Evidence concerning offers of compromise or settlement shall be 
inadmissible to the extent provided in Rule 408 of the Federal Rules of 
Evidence.
    (g) The ALJ shall permit the parties to introduce rebuttal witnesses 
and evidence.
    (h) All documents and other evidence offered or taken for the record 
shall be open to examination by all parties, unless otherwise ordered by 
the ALJ pursuant to Sec. 224.24.

[[Page 805]]



Sec. 224.35  The record.

    (a) The hearing will be recorded and transcribed. Transcripts may be 
obtained following the hearing from ALJ at a cost not to exceed the 
actual cost of duplication.
    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, all papers and requests filed in the proceeding 
constitute the record for the decision by the ALJ and the A.I.D. 
Administrator.
    (c) The record of the hearing may be inspected and copied (upon 
payment of a reasonable fee) by anyone, unless otherwise ordered by the 
ALJ pursuant to Sec. 224.24.



Sec. 224.36  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. In any 
event, any party may file a post-hearing brief. The ALJ shall fix the 
time for filing briefs, at a time not exceeding 60 days from the date 
the parties receive the transcript of the hearing or, if applicable, the 
stipulated record. Such briefs may be accompanied by proposed findings 
of fact and conclusions of law. The ALJ may permit the parties to file 
reply briefs.



Sec. 224.37  Initial decision.

    (a) The ALJ shall issue an initial decision based only on the 
record, which shall contain findings of fact, conclusions of law, and 
the amount of any penalties and assessments imposed.
    (b) The findings of fact shall include a finding on each of the 
following issues:
    (1) Whether the claims or statements identified in the complaint, or 
any portion thereof, violate Sec. 224.3;
    (2) If the person is liable for penalties or assessments, the 
appropriate amount of any such penalties or assessments, considering any 
mitigating or aggravating factors that he or she finds in the case, such 
as those described in Sec. 224.31.
    (c) The ALJ shall promptly serve the initial decision on all parties 
within 90 days after the time for submission of post-hearing briefs and 
reply briefs (if permitted) has expired. The ALJ shall at the same time 
serve all parties with a statement describing the right of any defendant 
determined to be liable for a civil penalty or assessment to file a 
motion for reconsideration with the ALJ or a notice of appeal with the 
A.I.D. Administrator. If the ALJ fails to meet the deadline contained in 
this paragraph, he or she shall notify the parties of the reason for the 
delay and shall set a new deadline.
    (d) Unless the initial decision of the ALJ is timely appealed to the 
A.I.D. Administrator, or a motion for reconsideration of the initial 
decision is timely filed, the initial decision shall constitute the 
final decision of the A.I.D. Administrator and shall be final and 
binding on the parties 30 days after it is issued by the ALJ.



Sec. 224.38  Reconsideration of initial decision.

    (a) Except as provided in paragraph (d) of this section, any party 
may file a motion for reconsideration of the initial decision within 20 
days of receipt of the initial decision. If service was made by mail, 
receipt will be presumed to be five days from the date of mailing in the 
absence of contrary proof.
    (b) Every such motion must set forth the matters claimed to have 
been erroneously decided and the nature of the alleged errors. Such 
motion shall be accompanied by a supporting brief.
    (c) Responses to such motions shall be allowed only upon request of 
the ALJ.
    (d) No party may file a motion for reconsideration of an initial 
decision that has been revised in response to a previous motion for 
reconsideration.
    (e) The ALJ may dispose of a motion for reconsideration by denying 
it or by issuing a revised initial decision.
    (f) If the ALJ denies a motion for reconsideration, the initial 
decision shall constitute the final decision of the A.I.D. Administrator 
and shall be final and binding on the parties 30 days after the ALJ 
denies the motion, unless the initial decision is timely appealed to the 
A.I.D. Administrator in accordance with Sec. 224.39.
    (g) If the ALJ issues a revised initial decision, that decision 
shall constitute the final decision of the A.I.D. Administrator and 
shall be final and binding on the parties 30 days after it is issued, 
unless it is timely appealed to the

[[Page 806]]

A.I.D. Administrator in accordance with Sec. 224.39.



Sec. 224.39  Appeal to A.I.D. Administrator.

    (a) Any defendant who has filed a timely answer and who is 
determined in an initial decision to be liable for a civil penalty or 
assessment may appeal such decision to the A.I.D. Administrator by 
filing a notice of appeal with the A.I.D. Administrator in accordance 
with this section.
    (b)(1) A notice of appeal may be filed at any time within 30 days 
after the ALJ issues an initial decision. However, if another party 
files a motion for reconsideration under Sec. 224.38, consideration of 
the appeal shall be stayed automatically pending resolution of the 
motion for reconsideration.
    (2) If a motion for reconsideration is timely filed, a notice of 
appeal may be filed within 30 days after the ALJ denies the motion or 
issues a revised initial decision, whichever applies.
    (3) The A.I.D. Administrator may extend the initial 30 day period 
for an additional 30 days if the defendant files with the A.I.D. 
Administrator a request for an extension within the initial 30 day 
period and shows good cause.
    (c) If the defendant files a timely notice of appeal with the A.I.D. 
Administrator, and the time for filing motions for reconsideration under 
Sec. 224.38 has expired, the ALJ shall forward the record of the 
proceeding to the A.I.D. Administrator.
    (d) A notice of appeal shall be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions.
    (e) The representative for the Government may file a brief in 
opposition to exceptions within 30 days of receiving the notice of 
appeal and accompanying brief.
    (f) There is no right to appear personally before the A.I.D. 
Administrator.
    (g) There is no right to appeal any interlocutory ruling by the ALJ.
    (h) In reviewing the initial decision, the A.I.D. Administrator 
shall not consider any objection that was not raised before the ALJ 
unless a demonstration is made of extraordinary circumstances causing 
the failure to raise the objection.
    (i) If any party demonstrates to the satisfaction of the A.I.D. 
Administrator that additional evidence not presented at such hearing is 
material and that there were reasonable grounds for the failure to 
present such evidence at such hearing, the A.I.D. Administrator shall 
remand the matter to the ALJ for consideration of such additional 
evidence.
    (j) The A.I.D. Administrator may affirm, reduce, reverse, 
compromise, remand, or settle any penalty or assessment determined by 
the ALJ in an initial decision.
    (k) The A.I.D. Administrator shall promptly serve each party to the 
appeal with a copy of his/her decision and a statement describing the 
right of any person determined to be liable for a penalty or assessment 
to seek judicial review.
    (l) Unless a petition for review is filed as provided in 31 U.S.C. 
3805 after a defendant has exhausted all administrative remedies under 
this part and within 60 days after the date on which the A.I.D. 
Administrator serves the defendant with a copy of his/her decision, a 
determination that a defendant is liable under Sec. 224.3 is final and 
is not subject to judicial review.



Sec. 224.40  Stays ordered by the Department of Justice.

    If at any time the Attorney General or an Assistant Attorney General 
designated by the Attorney General transmits to the A.I.D. Administrator 
a written finding that continuation of the administrative process 
described in this part with respect to a claim or statement may 
adversely affect any pending or potential criminal or civil action 
related to such claim or statement, the A.I.D. Administrator shall stay 
the process immediately. The A.I.D. Administrator may order the process 
resumed only upon receipt of the written authorization of the Attorney 
General.



Sec. 224.41  Stay pending appeal.

    (a) An initial decision is stayed automatically pending disposition 
of a motion for reconsideration or of an appeal to the A.I.D. 
Administrator.

[[Page 807]]

    (b) No administrative stay is available following a final decision 
of the A.I.D. Administrator.



Sec. 224.42  Judicial review.

    Section 3805 of title 31, United States Code, authorizes judicial 
review by an appropriate United States District Court of a final 
decision of the A.I.D. Administrator imposing penalties or assessments 
under this part and specifies the procedures for such review.



Sec. 224.43  Collection of civil penalties and assessments.

    Sections 3806 and 3808(b) of title 31, United States Code, authorize 
actions for collection of civil penalties and assessments imposed under 
this part and specify the procedures for such actions.



Sec. 224.44  Right to administrative offset.

    The amount of any penalty or assessment which has become final, or 
for which a judgment has been entered under Sec. 224.42 or Sec. 224.43, 
or any amount agreed upon in a compromise or settlement under 
Sec. 224.46, may be collected by administrative offset under 31 U.S.C. 
3716, except that an administrative offset may not be made under the 
subsection against a refund of an overpayment of Federal taxes, then or 
later owning by the United States to the defendant.



Sec. 224.45  Deposit in Treasury of United States.

    All amounts collected pursuant to this part shall be deposited as 
miscellaneous receipts in the Treasury of the United States, except as 
provided in 31 U.S.C. 3806(g).



Sec. 224.46  Compromise or settlement.

    (a) Parties may make offers of compromise or settlement at any time.
    (b) The reviewing official has the exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
reviewing official is permitted to issue a complaint and before the date 
on which the ALJ issues an initial decision.
    (c) The A.I.D. Administrator has exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
ALJ issues an initial decision, except during pendency of any review 
under Sec. 224.42 or during the pendency of any action to collect 
penalties and assessments under Sec. 224.43.
    (d) The Attorney General has exclusive authority to compromise or 
settle a case under this part during the pendency of any review under 
Sec. 224.42 or of any action to recover penalties and assessments under 
31 U.S.C. 3806.
    (e) The investigating official may recommend settlement terms to the 
reviewing official, the A.I.D. Administrator, or the Attorney General, 
as appropriate. The reviewing official may recommend settlement terms to 
the A.I.D. Administrator, or the Attorney General, as appropriate.
    (f) Any compromise or settlement must be in writing.



Sec. 224.47  Limitations.

    (a) The notice of hearing with respect to a claim or statement must 
be served in the manner specified in Sec. 224.8 within 6 years after the 
date on which such claim or statement is made.
    (b) If the defendant fails to file a timely answer, service of a 
notice under Sec. 224.10(b) shall be deemed notice of hearing for 
purposes of this section.
    (c) The statute of limitations may be extended by agreement of the 
parties.



PART 225--PROTECTION OF HUMAN SUBJECTS--Table of Contents




Sec.
225.101  To what does this policy apply?
225.102  Definitions.
225.103  Assuring compliance with this policy--research conducted or 
          supported by any Federal Department or Agency.
225.104--225.106  [Reserved]
225.107  IRB membership.
225.108  IRB functions and operations.
225.109  IRB review of research.
225.110  Expedited review procedures for certain kinds of research 
          involving no more than minimal risk, and for minor changes in 
          approved research.
225.111  Criteria for IRB approval of research.
225.112  Review by institution.
225.113  Suspension or termination of IRB approval of research.
225.114  Cooperative research.
225.115  IRB records.
225.116  General requirements for informed consent.
225.117  Documentation of informed consent.
225.118  Applications and proposals lacking

[[Page 808]]

          definite plans for involvement of human subjects.
225.119  Research undertaken without the intention of involving human 
          subjects.
225.120  Evaluation and disposition of applications and proposals for 
          research to be conducted or supported by a Federal Department 
          or Agency.
225.121  [Reserved]
225.122  Use of Federal funds.
225.123  Early termination of research support: Evaluation of 
          applications and proposals.
225.124  Conditions.

    Authority:  5 U.S.C. 301; 42 U.S.C. 300v-1(b), unless otherwise 
noted.

    Source:  56 FR 28012, 28020, June 18, 1991, unless otherwise noted.



Sec. 225.101  To what does this policy apply?

    (a) Except as provided in paragraph (b) of this section, this policy 
applies to all research involving human subjects conducted, supported or 
otherwise subject to regulation by any federal department or agency 
which takes appropriate administrative action to make the policy 
applicable to such research. This includes research conducted by federal 
civilian employees or military personnel, except that each department or 
agency head may adopt such procedural modifications as may be 
appropriate from an administrative standpoint. It also includes research 
conducted, supported, or otherwise subject to regulation by the federal 
government outside the United States.
    (1) Research that is conducted or supported by a federal department 
or agency, whether or not it is regulated as defined in Sec. 225.102(e), 
must comply with all sections of this policy.
    (2) Research that is neither conducted nor supported by a federal 
department or agency but is subject to regulation as defined in 
Sec. 225.102(e) must be reviewed and approved, in compliance with 
Secs. 225.101, 225.102, and Secs. 225.107 through 225.117 of this 
policy, by an institutional review board (IRB) that operates in 
accordance with the pertinent requirements of this policy.
    (b) Unless otherwise required by department or agency heads, 
research activities in which the only involvement of human subjects will 
be in one or more of the following categories are exempt from this 
policy:
    (1) Research conducted in established or commonly accepted 
educational settings, involving normal educational practices, such as 
(i) research on regular and special education instructional strategies, 
or (ii) research on the effectiveness of or the comparison among 
instructional techniques, curricula, or classroom management methods.
    (2) Research involving the use of educational tests (cognitive, 
diagnostic, aptitude, achievement), survey procedures, interview 
procedures or observation of public behavior, unless:
    (i) Information obtained is recorded in such a manner that human 
subjects can be identified, directly or through identifiers linked to 
the subjects; and (ii) any disclosure of the human subjects' responses 
outside the research could reasonably place the subjects at risk of 
criminal or civil liability or be damaging to the subjects' financial 
standing, employability, or reputation.
    (3) Research involving the use of educational tests (cognitive, 
diagnostic, aptitude, achievement), survey procedures, interview 
procedures, or observation of public behavior that is not exempt under 
paragraph (b)(2) of this section, if:
    (i) The human subjects are elected or appointed public officials or 
candidates for public office; or (ii) federal statute(s) require(s) 
without exception that the confidentiality of the personally 
identifiable information will be maintained throughout the research and 
thereafter.
    (4) Research, involving the collection or study of existing data, 
documents, records, pathological specimens, or diagnostic specimens, if 
these sources are publicly available or if the information is recorded 
by the investigator in such a manner that subjects cannot be identified, 
directly or through identifiers linked to the subjects.
    (5) Research and demonstration projects which are conducted by or 
subject to the approval of department or agency heads, and which are 
designed to study, evaluate, or otherwise examine:
    (i) Public benefit or service programs; (ii) procedures for 
obtaining

[[Page 809]]

benefits or services under those programs; (iii) possible changes in or 
alternatives to those programs or procedures; or (iv) possible changes 
in methods or levels of payment for benefits or services under those 
programs.
    (6) Taste and food quality evaluation and consumer acceptance 
studies, (i) if wholesome foods without additives are consumed or (ii) 
if a food is consumed that contains a food ingredient at or below the 
level and for a use found to be safe, or agricultural chemical or 
environmental contaminant at or below the level found to be safe, by the 
Food and Drug Administration or approved by the Environmental Protection 
Agency or the Food Safety and Inspection Service of the U.S. Department 
of Agriculture.
    (c) Department or agency heads retain final judgment as to whether a 
particular activity is covered by this policy.
    (d) Department or agency heads may require that specific research 
activities or classes of research activities conducted, supported, or 
otherwise subject to regulation by the department or agency but not 
otherwise covered by this policy, comply with some or all of the 
requirements of this policy.
    (e) Compliance with this policy requires compliance with pertinent 
federal laws or regulations which provide additional protections for 
human subjects.
    (f) This policy does not affect any state or local laws or 
regulations which may otherwise be applicable and which provide 
additional protections for human subjects.
    (g) This policy does not affect any foreign laws or regulations 
which may otherwise be applicable and which provide additional 
protections to human subjects of research.
    (h) When research covered by this policy takes place in foreign 
countries, procedures normally followed in the foreign countries to 
protect human subjects may differ from those set forth in this policy. 
[An example is a foreign institution which complies with guidelines 
consistent with the World Medical Assembly Declaration (Declaration of 
Helsinki amended 1989) issued either by sovereign states or by an 
organization whose function for the protection of human research 
subjects is internationally recognized.] In these circumstances, if a 
department or agency head determines that the procedures prescribed by 
the institution afford protections that are at least equivalent to those 
provided in this policy, the department or agency head may approve the 
substitution of the foreign procedures in lieu of the procedural 
requirements provided in this policy. Except when otherwise required by 
statute, Executive Order, or the department or agency head, notices of 
these actions as they occur will be published in the Federal Register or 
will be otherwise published as provided in department or agency 
procedures.
    (i) Unless otherwise required by law, department or agency heads may 
waive the applicability of some or all of the provisions of this policy 
to specific research activities or classes of research activities 
otherwise covered by this policy. Except when otherwise required by 
statute or Executive Order, the department or agency head shall forward 
advance notices of these actions to the Office for Protection from 
Research Risks, Department of Health and Human Services (HHS), and shall 
also publish them in the Federal Register or in such other manner as 
provided in department or agency procedures.\1\
---------------------------------------------------------------------------


    \1\ Institutions with HHS-approved assurances on file will abide by 
provisions of title 45 CFR part 46 subparts A-D. Some of the other 
Departments and Agencies have incorporated all provisions of title 45 
CFR part 46 into their policies and procedures as well. However, the 
exemptions at 45 CFR part 46.101(b) do not apply to research involving 
prisoners, fetuses, pregnant women, or human in vitro fertilization, 
subparts B and C. The exemption at 45 CFR part 46.101(b)(2), for 
research involving survey or interview procedures or observation of 
public behavior, does not apply to research with children, subpart D, 
except for research involving observations of public behavior when the 
investigator(s) do not participate in the activities being observed.
---------------------------------------------------------------------------

[56 FR 28012, 28020, June 18, 1991; 56 FR 29756, June 28, 1991]



Sec. 225.102  Definitions.

    (a) Department or agency head means the head of any federal 
department or

[[Page 810]]

agency and any other officer or employee of any department or agency to 
whom authority has been delegated.
    (b) Institution means any public or private entity or agency 
(including federal, state, and other agencies).
    (c) Legally authorized representative means an individual or 
judicial or other body authorized under applicable law to consent on 
behalf of a prospective subject to the subject's participation in the 
procedure(s) involved in the research.
    (d) Research means a systematic investigation, including research 
development, testing and evaluation, designed to develop or contribute 
to generalizable knowledge. Activities which meet this definition 
constitute research for purposes of this policy, whether or not they are 
conducted or supported under a program which is considered research for 
other purposes. For example, some demonstration and service programs may 
include research activities.
    (e) Research subject to regulation, and similar terms are intended 
to encompass those research activities for which a federal department or 
agency has specific responsibility for regulating as a research 
activity, (for example, Investigational New Drug requirements 
administered by the Food and Drug Administration). It does not include 
research activities which are incidentally regulated by a federal 
department or agency solely as part of the department's or agency's 
broader responsibility to regulate certain types of activities whether 
research or non-research in nature (for example, Wage and Hour 
requirements administered by the Department of Labor).
    (f) Human subject means a living individual about whom an 
investigator (whether professional or student) conducting research 
obtains--
    (1) data through intervention or interaction with the individual, or
    (2) identifiable private information.

Intervention includes both physical procedures by which data are 
gathered (for example, venipuncture) and manipulations of the subject or 
the subject's environment that are performed for research purposes. 
Interaction includes communication or interpersonal contact between 
investigator and subject. ``Private information'' includes information 
about behavior that occurs in a context in which an individual can 
reasonably expect that no observation or recording is taking place, and 
information which has been provided for specific purposes by an 
individual and which the individual can reasonably expect will not be 
made public (for example, a medical record). Private information must be 
individually identifiable (i.e., the identity of the subject is or may 
readily be ascertained by the investigator or associated with the 
information) in order for obtaining the information to constitute 
research involving human subjects.
    (g) IRB means an institutional review board established in accord 
with and for the purposes expressed in this policy.
    (h) IRB approval means the determination of the IRB that the 
research has been reviewed and may be conducted at an institution within 
the constraints set forth by the IRB and by other institutional and 
federal requirements.
    (i) Minimal risk means that the probability and magnitude of harm or 
discomfort anticipated in the research are not greater in and of 
themselves than those ordinarily encountered in daily life or during the 
performance of routine physical or psychological examinations or tests.
    (j) Certification means the official notification by the institution 
to the supporting department or agency, in accordance with the 
requirements of this policy, that a research project or activity 
involving human subjects has been reviewed and approved by an IRB in 
accordance with an approved assurance.



Sec. 225.103  Assuring compliance with this policy--research conducted or supported by any Federal Department or Agency.

    (a) Each institution engaged in research which is covered by this 
policy and which is conducted or supported by a federal department or 
agency shall provide written assurance satisfactory to the department or 
agency head that it will comply with the requirements set forth in this 
policy. In lieu of requiring submission of an assurance, individual 
department or agency heads

[[Page 811]]

shall accept the existence of a current assurance, appropriate for the 
research in question, on file with the Office for Protection from 
Research Risks, HHS, and approved for federalwide use by that office. 
When the existence of an HHS-approved assurance is accepted in lieu of 
requiring submission of an assurance, reports (except certification) 
required by this policy to be made to department and agency heads shall 
also be made to the Office for Protection from Research Risks, HHS.
    (b) Departments and agencies will conduct or support research 
covered by this policy only if the institution has an assurance approved 
as provided in this section, and only if the institution has certified 
to the department or agency head that the research has been reviewed and 
approved by an IRB provided for in the assurance, and will be subject to 
continuing review by the IRB. Assurances applicable to federally 
supported or conducted research shall at a minimum include:
    (1) A statement of principles governing the institution in the 
discharge of its responsibilities for protecting the rights and welfare 
of human subjects of research conducted at or sponsored by the 
institution, regardless of whether the research is subject to federal 
regulation. This may include an appropriate existing code, declaration, 
or statement of ethical principles, or a statement formulated by the 
institution itself. This requirement does not preempt provisions of this 
policy applicable to department- or agency-supported or regulated 
research and need not be applicable to any research exempted or waived 
under Sec. 225.101 (b) or (i).
    (2) Designation of one or more IRBs established in accordance with 
the requirements of this policy, and for which provisions are made for 
meeting space and sufficient staff to support the IRB's review and 
recordkeeping duties.
    (3) A list of IRB members identified by name; earned degrees; 
representative capacity; indications of experience such as board 
certifications, licenses, etc., sufficient to describe each member's 
chief anticipated contributions to IRB deliberations; and any employment 
or other relationship between each member and the institution; for 
example: full-time employee, part-time employee, member of governing 
panel or board, stockholder, paid or unpaid consultant. Changes in IRB 
membership shall be reported to the department or agency head, unless in 
accord with Sec. 225.103(a) of this policy, the existence of an HHS-
approved assurance is accepted. In this case, change in IRB membership 
shall be reported to the Office for Protection from Research Risks, HHS.
    (4) Written procedures which the IRB will follow (i) for conducting 
its initial and continuing review of research and for reporting its 
findings and actions to the investigator and the institution; (ii) for 
determining which projects require review more often than annually and 
which projects need verification from sources other than the 
investigators that no material changes have occurred since previous IRB 
review; and (iii) for ensuring prompt reporting to the IRB of proposed 
changes in a research activity, and for ensuring that such changes in 
approved research, during the period for which IRB approval has already 
been given, may not be initiated without IRB review and approval except 
when necessary to eliminate apparent immediate hazards to the subject.
    (5) Written procedures for ensuring prompt reporting to the IRB, 
appropriate institutional officials, and the department or agency head 
of (i) any unanticipated problems involving risks to subjects or others 
or any serious or continuing noncompliance with this policy or the 
requirements or determinations of the IRB and (ii) any suspension or 
termination of IRB approval.
    (c) The assurance shall be executed by an individual authorized to 
act for the institution and to assume on behalf of the institution the 
obligations imposed by this policy and shall be filed in such form and 
manner as the department or agency head prescribes.
    (d) The department or agency head will evaluate all assurances 
submitted in accordance with this policy through such officers and 
employees of the department or agency and such experts or consultants 
engaged for this purpose

[[Page 812]]

as the department or agency head determines to be appropriate. The 
department or agency head's evaluation will take into consideration the 
adequacy of the proposed IRB in light of the anticipated scope of the 
institution's research activities and the types of subject populations 
likely to be involved, the appropriateness of the proposed initial and 
continuing review procedures in light of the probable risks, and the 
size and complexity of the institution.
    (e) On the basis of this evaluation, the department or agency head 
may approve or disapprove the assurance, or enter into negotiations to 
develop an approvable one. The department or agency head may limit the 
period during which any particular approved assurance or class of 
approved assurances shall remain effective or otherwise condition or 
restrict approval.
    (f) Certification is required when the research is supported by a 
federal department or agency and not otherwise exempted or waived under 
Sec. 225.101 (b) or (i). An institution with an approved assurance shall 
certify that each application or proposal for research covered by the 
assurance and by Sec. 225.103 of this Policy has been reviewed and 
approved by the IRB. Such certification must be submitted with the 
application or proposal or by such later date as may be prescribed by 
the department or agency to which the application or proposal is 
submitted. Under no condition shall research covered by Sec. 225.103 of 
the Policy be supported prior to receipt of the certification that the 
research has been reviewed and approved by the IRB. Institutions without 
an approved assurance covering the research shall certify within 30 days 
after receipt of a request for such a certification from the department 
or agency, that the application or proposal has been approved by the 
IRB. If the certification is not submitted within these time limits, the 
application or proposal may be returned to the institution.

(Approved by the Office of Management and Budget under control number 
9999-0020)

[56 FR 28012, 28020, June 18, 1991; 56 FR 29756, June 28, 1991]



Secs. 225.104--225.106  [Reserved]



Sec. 225.107  IRB membership.

    (a) Each IRB shall have at least five members, with varying 
backgrounds to promote complete and adequate review of research 
activities commonly conducted by the institution. The IRB shall be 
sufficiently qualified through the experience and expertise of its 
members, and the diversity of the members, including consideration of 
race, gender, and cultural backgrounds and sensitivity to such issues as 
community attitudes, to promote respect for its advice and counsel in 
safeguarding the rights and welfare of human subjects. In addition to 
possessing the professional competence necessary to review specific 
research activities, the IRB shall be able to ascertain the 
acceptability of proposed research in terms of institutional commitments 
and regulations, applicable law, and standards of professional conduct 
and practice. The IRB shall therefore include persons knowledgeable in 
these areas. If an IRB regularly reviews research that involves a 
vulnerable category of subjects, such as children, prisoners, pregnant 
women, or handicapped or mentally disabled persons, consideration shall 
be given to the inclusion of one or more individuals who are 
knowledgeable about and experienced in working with these subjects.
    (b) Every nondiscriminatory effort will be made to ensure that no 
IRB consists entirely of men or entirely of women, including the 
institution's consideration of qualified persons of both sexes, so long 
as no selection is made to the IRB on the basis of gender. No IRB may 
consist entirely of members of one profession.
    (c) Each IRB shall include at least one member whose primary 
concerns are in scientific areas and at least one member whose primary 
concerns are in nonscientific areas.
    (d) Each IRB shall include at least one member who is not otherwise 
affiliated with the institution and who is not part of the immediate 
family of a person who is affiliated with the institution.
    (e) No IRB may have a member participate in the IRB's initial or 
continuing review of any project in which the

[[Page 813]]

member has a conflicting interest, except to provide information 
requested by the IRB.
    (f) An IRB may, in its discretion, invite individuals with 
competence in special areas to assist in the review of issues which 
require expertise beyond or in addition to that available on the IRB. 
These individuals may not vote with the IRB.



Sec. 225.108  IRB functions and operations.

    In order to fulfill the requirements of this policy each IRB shall:
    (a) Follow written procedures in the same detail as described in 
Sec. 225.103(b)(4) and, to the extent required by, Sec. 225.103(b)(5).
    (b) Except when an expedited review procedure is used (see 
Sec. 225.110), review proposed research at convened meetings at which a 
majority of the members of the IRB are present, including at least one 
member whose primary concerns are in nonscientific areas. In order for 
the research to be approved, it shall receive the approval of a majority 
of those members present at the meeting.



Sec. 225.109  IRB Review of Research.

    (a) An IRB shall review and have authority to approve, require 
modifications in (to secure approval), or disapprove all research 
activities covered by this policy.
    (b) An IRB shall require that information given to subjects as part 
of informed consent is in accordance with Sec. 225.116. The IRB may 
require that information, in addition to that specifically mentioned in 
Sec. 225.116, be given to the subjects when in the IRB's judgment the 
information would meaningfully add to the protection of the rights and 
welfare of subjects.
    (c) An IRB shall require documentation of informed consent or may 
waive documentation in accordance with Sec. 225.117.
    (d) An IRB shall notify investigators and the institution in writing 
of its decision to approve or disapprove the proposed research activity, 
or of modifications required to secure IRB approval of the research 
activity. If the IRB decides to disapprove a research activity, it shall 
include in its written notification a statement of the reasons for its 
decision and give the investigator an opportunity to respond in person 
or in writing.
    (e) An IRB shall conduct continuing review of research covered by 
this policy at intervals appropriate to the degree of risk, but not less 
than once per year, and shall have authority to observe or have a third 
party observe the consent process and the research.

(Approved by the Office of Management and Budget under control number 
9999-0020)



Sec. 225.110  Expedited review procedures for certain kinds of research involving no more than minimal risk, and for minor changes in approved research.

    (a) The Secretary, HHS, has established, and published as a Notice 
in the Federal Register, a list of categories of research that may be 
reviewed by the IRB through an expedited review procedure. The list will 
be amended, as appropriate after consultation with other departments and 
agencies, through periodic republication by the Secretary, HHS, in the 
Federal Register. A copy of the list is available from the Office for 
Protection from Research Risks, National Institutes of Health, HHS, 
Bethesda, Maryland 20892.
    (b) An IRB may use the expedited review procedure to review either 
or both of the following:
    (1) Some or all of the research appearing on the list and found by 
the reviewer(s) to involve no more than minimal risk,
    (2) Minor changes in previously approved research during the period 
(of one year or less) for which approval is authorized.
    Under an expedited review procedure, the review may be carried out 
by the IRB chairperson or by one or more experienced reviewers 
designated by the chairperson from among members of the IRB. In 
reviewing the research, the reviewers may exercise all of the 
authorities of the IRB except that the reviewers may not disapprove the 
research. A research activity may be disapproved only after review in 
accordance with the non-expedited procedure set forth in 
Sec. 225.108(b).

[[Page 814]]

    (c) Each IRB which uses an expedited review procedure shall adopt a 
method for keeping all members advised of research proposals which have 
been approved under the procedure.
    (d) The department or agency head may restrict, suspend, terminate, 
or choose not to authorize an institution's or IRB's use of the 
expedited review procedure.



Sec. 225.111  Criteria for IRB approval of research.

    (a) In order to approve research covered by this policy the IRB 
shall determine that all of the following requirements are satisfied:
    (1) Risks to subjects are minimized: (i) By using procedures which 
are consistent with sound research design and which do not unnecessarily 
expose subjects to risk, and (ii) whenever appropriate, by using 
procedures already being performed on the subjects for diagnostic or 
treatment purposes.
    (2) Risks to subjects are reasonable in relation to anticipated 
benefits, if any, to subjects, and the importance of the knowledge that 
may reasonably be expected to result. In evaluating risks and benefits, 
the IRB should consider only those risks and benefits that may result 
from the research (as distinguished from risks and benefits of therapies 
subjects would receive even if not participating in the research). The 
IRB should not consider possible long-range effects of applying 
knowledge gained in the research (for example, the possible effects of 
the research on public policy) as among those research risks that fall 
within the purview of its responsibility.
    (3) Selection of subjects is equitable. In making this assessment 
the IRB should take into account the purposes of the research and the 
setting in which the research will be conducted and should be 
particularly cognizant of the special problems of research involving 
vulnerable populations, such as children, prisoners, pregnant women, 
mentally disabled persons, or economically or educationally 
disadvantaged persons.
    (4) Informed consent will be sought from each prospective subject or 
the subject's legally authorized representative, in accordance with, and 
to the extent required by Sec. 225.116.
    (5) Informed consent will be appropriately documented, in accordance 
with, and to the extent required by Sec. 225.117.
    (6) When appropriate, the research plan makes adequate provision for 
monitoring the data collected to ensure the safety of subjects.
    (7) When appropriate, there are adequate provisions to protect the 
privacy of subjects and to maintain the confidentiality of data.
    (b) When some or all of the subjects are likely to be vulnerable to 
coercion or undue influence, such as children, prisoners, pregnant 
women, mentally disabled persons, or economically or educationally 
disadvantaged persons, additional safeguards have been included in the 
study to protect the rights and welfare of these subjects.



Sec. 225.112  Review by institution.

    Research covered by this policy that has been approved by an IRB may 
be subject to further appropriate review and approval or disapproval by 
officials of the institution. However, those officials may not approve 
the research if it has not been approved by an IRB.



Sec. 225.113  Suspension or termination of IRB approval of research.

    An IRB shall have authority to suspend or terminate approval of 
research that is not being conducted in accordance with the IRB's 
requirements or that has been associated with unexpected serious harm to 
subjects. Any suspension or termination of approval shall include a 
statement of the reasons for the IRB's action and shall be reported 
promptly to the investigator, appropriate institutional officials, and 
the department or agency head.

(Approved by the Office of Management and Budget under control number 
9999-0020)



Sec. 225.114  Cooperative research.

    Cooperative research projects are those projects covered by this 
policy which involve more than one institution. In the conduct of 
cooperative research projects, each institution is responsible for 
safeguarding the rights and welfare of human subjects and for

[[Page 815]]

complying with this policy. With the approval of the department or 
agency head, an institution participating in a cooperative project may 
enter into a joint review arrangement, rely upon the review of another 
qualified IRB, or make similar arrangements for avoiding duplication of 
effort.



Sec. 225.115  IRB records.

    (a) An institution, or when appropriate an IRB, shall prepare and 
maintain adequate documentation of IRB activities, including the 
following:
    (1) Copies of all research proposals reviewed, scientific 
evaluations, if any, that accompany the proposals, approved sample 
consent documents, progress reports submitted by investigators, and 
reports of injuries to subjects.
    (2) Minutes of IRB meetings which shall be in sufficient detail to 
show attendance at the meetings; actions taken by the IRB; the vote on 
these actions including the number of members voting for, against, and 
abstaining; the basis for requiring changes in or disapproving research; 
and a written summary of the discussion of controverted issues and their 
resolution.
    (3) Records of continuing review activities.
    (4) Copies of all correspondence between the IRB and the 
investigators.
    (5) A list of IRB members in the same detail as described is 
Sec. 225.103(b)(3).
    (6) Written procedures for the IRB in the same detail as described 
in Sec. 225.103(b)(4) and Sec. 225.103(b)(5).
    (7) Statements of significant new findings provided to subjects, as 
required by Sec. 225.116(b)(5).
    (b) The records required by this policy shall be retained for at 
least 3 years, and records relating to research which is conducted shall 
be retained for at least 3 years after completion of the research. All 
records shall be accessible for inspection and copying by authorized 
representatives of the department or agency at reasonable times and in a 
reasonable manner.

(Approved by the Office of Management and Budget under control number 
9999-0020)



Sec. 225.116  General requirements for informed consent.

    Except as provided elsewhere in this policy, no investigator may 
involve a human being as a subject in research covered by this policy 
unless the investigator has obtained the legally effective informed 
consent of the subject or the subject's legally authorized 
representative. An investigator shall seek such consent only under 
circumstances that provide the prospective subject or the representative 
sufficient opportunity to consider whether or not to participate and 
that minimize the possibility of coercion or undue influence. The 
information that is given to the subject or the representative shall be 
in language understandable to the subject or the representative. No 
informed consent, whether oral or written, may include any exculpatory 
language through which the subject or the representative is made to 
waive or appear to waive any of the subject's legal rights, or releases 
or appears to release the investigator, the sponsor, the institution or 
its agents from liability for negligence.
    (a) Basic elements of informed consent. Except as provided in 
paragraph (c) or (d) of this section, in seeking informed consent the 
following information shall be provided to each subject:
    (1) A statement that the study involves research, an explanation of 
the purposes of the research and the expected duration of the subject's 
participation, a description of the procedures to be followed, and 
identification of any procedures which are experimental;
    (2) A description of any reasonably foreseeable risks or discomforts 
to the subject;
    (3) A description of any benefits to the subject or to others which 
may reasonably be expected from the research;
    (4) A disclosure of appropriate alternative procedures or courses of 
treatment, if any, that might be advantageous to the subject;
    (5) A statement describing the extent, if any, to which 
confidentiality of records identifying the subject will be maintained;
    (6) For research involving more than minimal risk, an explanation as 
to

[[Page 816]]

whether any compensation and an explanation as to whether any medical 
treatments are available if injury occurs and, if so, what they consist 
of, or where further information may be obtained;
    (7) An explanation of whom to contact for answers to pertinent 
questions about the research and research subjects' rights, and whom to 
contact in the event of a research-related injury to the subject; and
    (8) A statement that participation is voluntary, refusal to 
participate will involve no penalty or loss of benefits to which the 
subject is otherwise entitled, and the subject may discontinue 
participation at any time without penalty or loss of benefits to which 
the subject is otherwise entitled.
    (b) Additional elements of informed consent. When appropriate, one 
or more of the following elements of information shall also be provided 
to each subject:
    (1) A statement that the particular treatment or procedure may 
involve risks to the subject (or to the embryo or fetus, if the subject 
is or may become pregnant) which are currently unforeseeable;
    (2) Anticipated circumstances under which the subject's 
participation may be terminated by the investigator without regard to 
the subject's consent;
    (3) Any additional costs to the subject that may result from 
participation in the research;
    (4)The consequences of a subject's decision to withdraw from the 
research and procedures for orderly termination of participation by the 
subject;
    (5) A statement that significant new findings developed during the 
course of the research which may relate to the subject's willingness to 
continue participation will be provided to the subject; and
    (6) The approximate number of subjects involved in the study.
    (c) An IRB may approve a consent procedure which does not include, 
or which alters, some or all of the elements of informed consent set 
forth above, or waive the requirement to obtain informed consent 
provided the IRB finds and documents that:
    (1) The research or demonstration project is to be conducted by or 
subject to the approval of state or local government officials and is 
designed to study, evaluate, or otherwise examine: (i) Public benefit of 
service programs; (ii) procedures for obtaining benefits or services 
under those programs; (iii) possible changes in or alternatives to those 
programs or procedures; or (iv) possible changes in methods or levels of 
payment for benefits or services under those programs; and
    (2) The research could not practicably be carried out without the 
waiver or alteration.
    (d) An IRB may approve a consent procedure which does not include, 
or which alters, some or all of the elements of informed consent set 
forth in this section, or waive the requirements to obtain informed 
consent provided the IRB finds and documents that:
    (1) The research involves no more than minimal risk to the subjects;
    (2) The waiver or alteration will not adversely affect the rights 
and welfare of the subjects;
    (3) The research could not practicably be carried out without the 
waiver or alteration; and
    (4) Whenever appropriate, the subjects will be provided with 
additional pertinent information after participation.
    (e) The informed consent requirements in this policy are not 
intended to preempt any applicable federal, state, or local laws which 
require additional information to be disclosed in order for informed 
consent to be legally effective.
    (f) Nothing in this policy is intended to limit the authority of a 
physician to provide emergency medical care, to the extent the physician 
is permitted to do so under applicable federal, state, or local law.

(Approved by the Office of Management and Budget under control number 
9999-0020)



Sec. 225.117  Documentation of informed consent.

    (a) Except as provided in paragraph (c) of this section, informed 
consent shall be documented by the use of a written consent form 
approved by the IRB and signed by the subject or the

[[Page 817]]

subject's legally authorized representative. A copy shall be given to 
the person signing the form.
    (b) Except as provided in paragraph (c) of this section, the consent 
form may be either of the following:
    (1) A written consent document that embodies the elements of 
informed consent required by Sec. 225.116. This form may be read to the 
subject or the subject's legally authorized representative, but in any 
event, the investigator shall give either the subject or the 
representative adequate opportunity to read it before it is signed; or
    (2) A short form written consent document stating that the elements 
of informed consent required by Sec. 225.116 have been presented orally 
to the subject or the subject's legally authorized representative. When 
this method is used, there shall be a witness to the oral presentation. 
Also, the IRB shall approve a written summary of what is to be said to 
the subject or the representative. Only the short form itself is to be 
signed by the subject or the representative. However, the witness shall 
sign both the short form and a copy of the summary, and the person 
actually obtaining consent shall sign a copy of the summary. A copy of 
the summary shall be given to the subject or the representative, in 
addition to a copy of the short form.
    (c) An IRB may waive the requirement for the investigator to obtain 
a signed consent form for some or all subjects if it finds either:
    (1) That the only record linking the subject and the research would 
be the consent document and the principal risk would be potential harm 
resulting from a breach of confidentiality. Each subject will be asked 
whether the subject wants documentation linking the subject with the 
research, and the subject's wishes will govern; or
    (2) That the research presents no more than minimal risk of harm to 
subjects and involves no procedures for which written consent is 
normally required outside of the research context.
    In cases in which the documentation requirement is waived, the IRB 
may require the investigator to provide subjects with a written 
statement regarding the research.

(Approved by the Office of Management and Budget under control number 
9999-0020)



Sec. 225.118  Applications and proposals lacking definite plans for involvement of human subjects.

    Certain types of applications for grants, cooperative agreements, or 
contracts are submitted to departments or agencies with the knowledge 
that subjects may be involved within the period of support, but definite 
plans would not normally be set forth in the application or proposal. 
These include activities such as institutional type grants when 
selection of specific projects is the institution's responsibility; 
research training grants in which the activities involving subjects 
remain to be selected; and projects in which human subjects' involvement 
will depend upon completion of instruments, prior animal studies, or 
purification of compounds. These applications need not be reviewed by an 
IRB before an award may be made. However, except for research exempted 
or waived under Sec. 225.101 (b) or (i), no human subjects may be 
involved in any project supported by these awards until the project has 
been reviewed and approved by the IRB, as provided in this policy, and 
certification submitted, by the institution, to the department or 
agency.



Sec. 225.119  Research undertaken without the intention of involving human subjects.

    In the event research is undertaken without the intention of 
involving human subjects, but it is later proposed to involve human 
subjects in the research, the research shall first be reviewed and 
approved by an IRB, as provided in this policy, a certification 
submitted, by the institution, to the department or agency, and final 
approval given to the proposed change by the department or agency.



Sec. 225.120  Evaluation and disposition of applications and proposals for research to be conducted or supported by a Federal Department or Agency.

    The department or agency head will evaluate all applications and 
proposals

[[Page 818]]

involving human subjects submitted to the department or agency through 
such officers and employees of the department or agency and such experts 
and consultants as the department or agency head determines to be 
appropriate. This evaluation will take into consideration the risks to 
the subjects, the adequacy of protection against these risks, the 
potential benefits of the research to the subjects and others, and the 
importance of the knowledge gained or to be gained.
    (b) On the basis of this evaluation, the department or agency head 
may approve or disapprove the application or proposal, or enter into 
negotiations to develop an approvable one.



Sec. 225.121  [Reserved]



Sec. 225.122  Use of Federal funds.

    Federal funds administered by a department or agency may not be 
expended for research involving human subjects unless the requirements 
of this policy have been satisfied.



Sec. 225.123  Early termination of research support: Evaluation of applications and proposals.

    (a) The department or agency head may require that department or 
agency support for any project be terminated or suspended in the manner 
prescribed in applicable program requirements, when the department or 
agency head finds an institution has materially failed to comply with 
the terms of this policy.
    (b) In making decisions about supporting or approving applications 
or proposals covered by this policy the department or agency head may 
take into account, in addition to all other eligibility requirements and 
program criteria, factors such as whether the applicant has been subject 
to a termination or suspension under paragarph (a) of this section and 
whether the applicant or the person or persons who would direct or has 
have directed the scientific and technical aspects of an activity has 
have, in the judgment of the department or agency head, materially 
failed to discharge responsibility for the protection of the rights and 
welfare of human subjects (whether or not the research was subject to 
federal regulation).



Sec. 225.124  Conditions.

    With respect to any research project or any class of research 
projects the department or agency head may impose additional conditions 
prior to or at the time of approval when in the judgment of the 
department or agency head additional conditions are necessary for the 
protection of human subjects.



PART 226--ADMINISTRATION OF ASSISTANCE AWARDS TO U.S. NON-GOVERNMENTAL ORGANIZATIONS--Table of Contents




                           Subpart A--General

Sec.
226.1  Purpose and applicability.
226.2  Definitions.
226.3  Effect on other issuances.
226.4  Deviations.
226.5  Subawards.

                    Subpart B--Pre-award Requirements

226.10  Purpose.
226.11  Pre-award policies.
226.12  Forms for applying for Federal assistance.
226.13  Debarment and suspension.
226.14  Special award conditions.
226.15  Metric system of measurement.
226.16  Resource Conservation and Recovery Act.
226.17  Certifications and representations.

                   Subpart C--Post-award Requirements

                    Financial and Program Management

226.20  Purpose of financial and program management.
226.21  Standards for financial management systems.
226.22  Payment.
226.23  Cost sharing or matching.
226.24  Program income.
226.25  Revision of budget and program plans.
226.26  Non-Federal audits.
226.27  Allowable costs.
226.28  Period of availability of funds.

                           Property Standards

226.30  Purpose of property standards.
226.31  Insurance coverage.
226.32  Real property.
226.33  Federally-owned and exempt property.
226.34  Equipment.

[[Page 819]]

226.35  Supplies and other expendable equipment.
226.36  Intangible property.
226.37  Property trust relationship.

                          Procurement Standards

226.40  Purpose of procurement standards.
226.41  Recipient responsibilities.
226.42  Codes of conduct.
226.43  Competition.
226.44  Procurement procedures.
226.45  Cost and price analysis.
226.46  Procurement records.
226.47  Contract administration.
226.48  Contract provisions.
226.49  USAID-Specific procurement requirements.

                           Reports and Records

226.50  Purpose of reports and records.
226.51  Monitoring and reporting program performance.
226.52  Financial reporting.
226.53  Retention and access requirements for records.

                 Suspension, Termination and Enforcement

226.60  Purpose of suspension, termination and enforcement.
226.61  Suspension and termination.
226.62  Enforcement.

                 Subpart D--After-the-Award Requirements

226.70  Purpose.
226.71  Closeout procedures.
226.72  Subsequent adjustments and continuing responsibilities.
226.73  Collection of amounts due.

  Subpart E--Special Provisions for Awards to Commercial Organizations

226.80  Scope of subpart.
226.81  Prohibition against profit.
226.82  Program income.

                        Subpart F--Miscellaneous

226.90  Disputes.

                 Subpart G--USAID-Specific Requirements

226.1001  Eligibility rules for goods and services. [Reserved]
226.1002  Local cost financing. [Reserved]
226.1003  Air transportation. [Reserved]
226.1004  Ocean shipment of goods. [Reserved]

Appendix A to Part 226--Contract Provisions

    Authority:  Sec. 621, Pub. L. 87-195, 75 Stat. 445 (22 U.S.C. 2381), 
as amended; E.O. 12163, Sept. 29, 1979, 44 FR 56673; 3 CFR 1979 Comp., 
p. 435.

    Source:  60 FR 3744, Jan. 19, 1995.



                           Subpart A--General



Sec. 226.1  Purpose and applicability.

    Except as otherwise authorized by statute, this part establishes 
uniform administrative requirements for grants and cooperative 
agreements awarded by USAID to U.S. institutions of higher education, 
hospitals, and other non-profit organizations, and to U.S. commercial 
organizations; and to subawards thereunder. USAID shall not impose 
additional or inconsistent requirements, except as provided in Sections 
226.4, and 226.14, or unless specifically required by Federal statute or 
executive order. Non-profit and commercial organizations that implement 
Federal programs for the States are also subject to State requirements.



Sec. 226.2  Definitions.

    Accrued expenditures means the charges incurred by the recipient 
during a given period requiring the provision of funds for:
    (1) Goods and other tangible property received;
    (2) Services performed by employees, contractors, subrecipients, and 
other payees; and,
    (3) Other amounts becoming owed under programs for which no current 
services or performance is required.
    Accrued income means the sum of:
    (1) Earnings during a given period from services performed by the 
recipient, and goods and other tangible property delivered to 
purchasers, and
    (2) Amounts becoming owed to the recipient for which no current 
services or performance is required by the recipient.
    Acquisition cost of equipment means the net invoice price of the 
equipment, including the cost of modifications, attachments, 
accessories, or auxiliary apparatus necessary to make the property 
usable for the purpose for which it was acquired. Other charges, such as 
the cost of installation, transportation, taxes, duty or protective in-
transit insurance, shall be included or excluded from the unit 
acquisition cost in accordance with the recipient's regular accounting 
practices.
    Advance means a payment made by Treasury check or other appropriate 
payment mechanism to a recipient

[[Page 820]]

upon its request either before outlays are made by the recipient or 
through the use of predetermined payment schedules.
    Agreement Officer means a person with the authority to enter into, 
administer, terminate and/or closeout assistance agreements subject to 
this part, and make related determinations and findings on behalf of 
USAID. An Agreement Officer can only act within the scope of a duly 
authorized warrant or other valid delegation of authority. The term 
``Agreement Officer'' includes persons warranted as ``Grant Officers.'' 
It also includes certain authorized representatives of the Agreement 
Officer acting within the limits of their authority as delegated by the 
Agreement Officer.
    Award means financial assistance that provides support or 
stimulation to accomplish a public purpose. Awards include grants, 
cooperative agreements and other agreements in the form of money or 
property in lieu of money, by the Federal Government to an eligible 
recipient. The term does not include: Technical assistance, which 
provides services instead of money; other assistance in the form of 
loans, loan guarantees, interest subsidies, or insurance; direct 
payments of any kind to individuals; and, contracts which are required 
to be entered into and administered under procurement laws and 
regulations.
    Cash contributions means the recipient's cash outlay, including the 
outlay of money contributed to the recipient by third parties.
    Closeout means the process by which the Agreement Officer determines 
that all applicable administrative actions and all required work of the 
award have been completed by the recipient and USAID.
    Contract means a procurement contract under an award or subaward, 
and a procurement subcontract under a recipient's or subrecipient's 
contract.
    Cost sharing or matching means that portion of project or program 
costs not borne by the Federal Government.
    Date of completion means the date on which all work under an award 
is completed or the date on the award document, or any supplement or 
amendment thereto, on which USAID sponsorship ends.
    Disallowed costs means those charges to an award that the USAID 
Agreement Officer determines to be unallowable, in accordance with the 
applicable Federal costs principles or other terms and conditions 
contained in the award.
    Equipment means tangible nonexpendable personal property including 
exempt property charged directly to the award having a useful life of 
more than one year and an acquisition cost of $5,000 or more per unit. 
However, consistent with recipient policy, lower limits may be 
established.
    Excess property means property under the control of USAID that, as 
determined by the head of the Agency, is no longer required for its 
needs or the discharge of its responsibilities.
    Exempt property means tangible personal property acquired in whole 
or in part with Federal funds, where the Federal awarding agency has 
statutory authority to vest title in the recipient without further 
obligation to the Federal Government. An example of exempt property 
authority is contained in the Federal Grant and Cooperative Agreement 
Act (31 U.S.C. 6306), for property acquired under an award to conduct 
basic or applied research by a non-profit institution of higher 
education or non-profit organization whose principal purpose is 
conducting scientific research.
    Federal awarding agency means the Federal agency that provides an 
award to the recipient.
    Federal funds authorized means the total amount of Federal funds 
obligated by the Federal Government for use by the recipient. This 
amount may include any authorized carryover of unobligated funds from 
prior funding periods when permitted by agency regulations or agency 
implementing instructions.
    Federal share of real property, equipment, or supplies means that 
percentage of the property's acquisition costs and any improvement 
expenditures paid with Federal funds.
    Funding period means the period of time when Federal funding is 
available for obligation by the recipient.
    Intangible property and debt instruments means, but is not limited 
to,

[[Page 821]]

trademarks, copyrights, patents and patent applications and such 
property as loans, notes and other debt instruments, lease agreements, 
stock and other instruments of property ownership, whether considered 
tangible or intangible.
    Obligations means the amounts of orders placed, contracts and grants 
awarded, services received and similar transactions during a given 
period that require payment by the recipient during the same or a future 
period.
    Outlays or expenditures means charges made to the project or 
program. They may be reported on a cash or accrual basis. For reports 
prepared on a cash basis, outlays are the sum of cash disbursements for 
direct charges for goods and services, the amount of indirect expense 
charged, the value of third party in-kind contributions applies and the 
amount of cash advances and payments made to subrecipients. For reports 
prepared on an accrual basis, outlays are the sum of cash disbursements 
for direct charges for goods and services, the amount of indirect 
expense incurred, the value of in-kind contributions applied, and the 
net increase (or decrease) in the amounts owed by the recipient for 
goods and other property received, for services performed by employees, 
contractors, subrecipients and other payees and other amounts becoming 
owed under programs for which no current services or performance are 
required.
    Personal property means property of any kind except real property. 
It may be tangible, having physical existence, or intangible, having no 
physical existence, such as copyrights, patents, or securities.
    Prior approval means written approval by an authorized official 
evidencing prior consent.
    Program income means gross income earned by the recipient that is 
directly generated by a supported activity or earned as a result of the 
award (see exclusions in Secs. 226.24 (e) and (h)). Program income 
includes, but is not limited to, income from fees for services 
performed, the use or rental of real or personal property acquired under 
federally-funded projects, the sale of commodities or items fabricated 
under an award, license fees and royalties on patents and copyrights, 
and interest on loans made with award funds. Interest earned on advances 
of Federal funds is not program income. Except as otherwise provided in 
USAID regulations or the terms and conditions of the award, program 
income does not include the receipt of principal on loans, rebates, 
credits, discounts, etc., or interest earned on any of them.
    Project costs means all allowable costs, as set forth in the 
applicable Federal cost principles, incurred by a recipient and the 
value of the contributions made by third parties in accomplishing the 
objectives of the award during the project period.
    Project period means the period established in the award document 
during which Federal sponsorship begins and ends.
    Property means, unless otherwise stated, real property, equipment, 
supplies, intangible property and debt instruments.
    Real property means land, including land improvements, structures 
and appurtenances thereto, but excludes movable machinery and equipment.
    Recipient means an organization receiving a grant or cooperative 
agreement directly from USAID to carry out a project or program. The 
term includes the following types of U.S. organizations: public and 
private institutions of higher education; public and private hospitals; 
quasi-public and private non-profit organizations such as, but not 
limited to, community action agencies, research institutes, educational 
associations, and health centers; and commercial organizations. The term 
does not include government-owned contractor-operated facilities or 
research centers providing continued support for mission-oriented, 
large-scale programs that are government-owned or controlled, or are 
designated as federally-funded research and development centers.
    Research and development means all research activities, both basic 
and applied, and all development activities that are supported at 
universities, colleges, and other non-profit institutions. ``Research'' 
is defined as a systematic study directed toward fuller scientific 
knowledge or understanding of the subject studied. ``Development''

[[Page 822]]

is the systematic use of knowledge and understanding gained from 
research directed toward the production of useful materials, devices, 
systems, or methods, including design and development of prototypes and 
processes. The term research also includes activities involving the 
training of individuals in research techniques where such activities 
utilize the same facilities as other research and development activities 
and where such activities are not included in the instruction function.
    Small awards means a grant or cooperative agreement not exceeding 
the small purchase threshold fixed at 41 U.S.C. 403(11).
    Subaward means an award of financial assistance in the form of 
money, or property in lieu of money, made under an award by a recipient 
to an eligible subrecipient or by a subrecipient to a lower tier 
subrecipient. The term includes financial assistance when provided by 
any legal agreement, even if the agreement is called a contract, but 
does not include procurement of goods and services nor does it include 
any form of assistance which is excluded from the definition of 
``award'' in this section.
    Subrecipient means the legal entity to which a subaward is made and 
which is accountable to the recipient for the use of the funds provided.
    Supplies means all personal property excluding equipment, intangible 
property, and debt instruments as defined in this section, and 
inventions of a contractor conceived or first actually reduced to 
practice in the performance of work under a funding agreement (``subject 
inventions''), as defined in 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and Small Business Firms Under 
Government Grants, Contracts, and Cooperative Agreements.''
    Suspension means an action by USAID that temporarily withdraws 
Federal sponsorship under an award, pending corrective action by the 
recipient or pending a decision to terminate the award. Suspension of an 
award is a separate action from suspension under USAID regulations 
implementing E.O.s 12549 and 12689, ``Debarment and Suspension.'' See 22 
CFR Part 208.
    Termination means the cancellation of USAID sponsorship, in whole or 
in part, under an agreement at any time prior to the date of completion.
    Third party in-kind contributions means the value of non-cash 
contributions provided by non-Federal third parties. Third party in-kind 
contributions may be in the form of real property, equipment, supplies 
and other expendable property, and the value of goods and services 
directly benefiting and specifically identifiable to the project or 
program.
    Unliquidated obligations, for financial reports prepared on a cash 
basis, means the amount of obligations incurred by the recipient that 
have not been paid. For reports prepared on an accrued expenditure 
basis, they represent the amount of obligations incurred by the 
recipient for which an outlay has not been recorded.
    Unobligated balance means the portion of the funds authorized by 
USAID that has not been obligated by the recipient and is determined by 
deducting the cumulative obligations from the cumulative funds 
authorized.
    Unrecovered indirect cost means the difference between the amount 
awarded and the amount which could have been awarded under the 
recipient's approved negotiated indirect cost rate.
    USAID means the United States Agency for International Development.
    Working capital advance means a procedure whereby funds are advanced 
to the recipient to cover its estimated disbursement needs for a given 
initial period.



Sec. 226.3  Effect on other issuances.

    For awards subject to this part, all administrative requirements of 
codified program regulations, program manuals, handbooks and other 
nonregulatory materials which are inconsistent with the requirements of 
this part shall be superseded, except to the extent they are required by 
statute, or authorized in accordance with the deviations provision 
Sec. 226.4.



Sec. 226.4  Deviations.

    The Office of Management and Budget (OMB) may grant exceptions for 
classes of grants or recipients subject to the requirements of this part 
when

[[Page 823]]

exceptions are not prohibited by statute. However, in the interest of 
maximum uniformity, exceptions from the requirements of this part shall 
be permitted only in unusual circumstances. USAID may apply more 
restrictive requirements to a class of recipients when approved by OMB. 
USAID may apply less restrictive requirements when awarding small 
awards, except for those requirements which are statutory. Exceptions on 
a case-by-case basis may also be made by the USAID Deputy Assistant 
Administrator for Management.



Sec. 226.5  Subawards.

    Unless sections of this part specifically exclude subrecipients from 
coverage, the provisions of this part shall be applied to subrecipients 
if such subrecipients are organizations which, if receiving awards 
directly from USAID, would fall within the definition of recipients. 
State and local government subrecipients are subject to the provisions 
of regulations implementing the grants management common rule, ``Uniform 
Administrative Requirements for Grants and Cooperative Agreements to 
State and Local Governments,'' as amended.



                    Subpart B--Pre-award Requirements



Sec. 226.10  Purpose.

    Sections 226.11 through 226.17 prescribe forms and instructions and 
other pre-award matters to be used in applying for USAID awards.



Sec. 226.11  Pre-award policies.

    (a) Use of grants and cooperative agreements, and contracts. In each 
instance USAID shall decide on the appropriate award instrument (i.e., 
grant cooperative agreement or contract). The Federal Grant and 
Cooperative Agreement Act (31 U.S.C. 6301-08) governs the use of grants, 
cooperative agreements and contracts. A grant or cooperative agreement 
shall be used only when the principal purpose of a transaction is to 
accomplish a public purpose of support or stimulation authorized by 
Federal statute. The statutory criterion for choosing between grants and 
cooperative agreements is that for the latter, ``substantial involvement 
is expected between the executive agency and the State, local 
government, or other recipient when carrying out the activity 
contemplated in the agreement.'' Contracts shall be used when the 
principal purpose is acquisition of property or services for the direct 
benefit or use of the Federal Government.
    (b) Public notice and priority setting. USAID shall notify the 
public of its intended funding priorities for discretionary grant 
programs, unless funding priorities are established by Federal statute.



Sec. 226.12  Forms for applying for Federal assistance.

    (a) USAID shall comply with the applicable report clearance 
requirements of 5 CFR part 1320, ``Controlling Paperwork Burdens on the 
Public,'' with regard to all forms used in place of or as a supplement 
to the Standard Form 424 (SF-424) series.
    (b) Applicants shall use the SF-424 series or those forms and 
instructions prescribed by USAID.
    (c) For Federal programs covered by E.O. 12372, ``Intergovernmental 
Review of Federal Programs,'' the applicant shall complete the 
appropriate sections of the SF-424 (Application for Federal Assistance) 
indicating whether the application was subject to review by the State 
Single Point of Contact (SPOC). The name and address of the SPOC for a 
particular State can be obtained from the Federal awarding agency or the 
Catalog of Federal Domestic Assistance. The SPOC shall advise the 
applicant whether the program for which application is made has been 
selected by that State for review.
    (d) Federal awarding agencies that do not use the SF-424 form should 
indicate whether the application is subject to review by the State under 
E.O. 12372.



Sec. 226.13  Debarment and suspension.

    USAID and recipients shall comply with the nonprocurement debarment 
and suspension common rule implementing E.O.s 12549 and 12689, 
``Debarment and Suspension,'' 22 CFR Part 208. This common rule 
restricts subawards and contracts with certain parties that are 
debarred, suspended or otherwise excluded from or ineligible

[[Page 824]]

for participation in Federal assistance programs or activities.



Sec. 226.14  Special award conditions.

    If an applicant or recipient: Has a history of poor performance, is 
not financially stable, has a management system that does not meet the 
standards prescribed in this part, has not conformed to the terms and 
conditions of a previous award, or is not otherwise responsible, the 
USAID Agreement Officer may impose additional requirements as needed, 
provided that such applicant or recipient is notified in writing as to: 
The nature of the additional requirements, the reason why the additional 
requirements are being imposed, the nature of the corrective action 
needed, the time allowed for completing the corrective actions, and the 
method for requesting reconsideration of the additional requirements 
imposed. Any special conditions will be promptly removed once the 
conditions that prompted them have been corrected.



Sec. 226.15  Metric system of measurement.

    (a) The Metric Conversion Act, as amended by the Omnibus Trade and 
Competitiveness Act (15 U.S.C. 205) declares that the metric system is 
the preferred measurement system for U.S. trade and commerce.
    (b) Wherever measurements are required or authorized, they shall be 
made, computed, and recorded in metric system units of measurement, 
unless otherwise authorized by the agreement officer in writing when it 
has been found that such usage is impractical or is likely to cause U.S. 
firms to experience significant inefficiencies or the loss of markets. 
Where the metric system is not the predominant standard for a particular 
application, measurements may be expressed in both the metric and the 
traditional equivalent units, provided the metric units are listed 
first.



Sec. 226.16  Resource Conservation and Recovery Act.

    Under the Act, any U.S. State agency or agency of a political 
subdivision of a State which is using appropriated Federal funds must 
comply with Section 6002. Section 6002 requires that preference be given 
in procurement programs to the purchase of specific products containing 
recycled materials identified in guidelines developed by the 
Environmental Protection Agency (EPA) (40 CFR parts 247-254). 
Accordingly, State and local institutions of higher education and 
hospitals that receive direct Federal awards or other Federal funds 
shall given preference in their procurement programs funded with Federal 
funds to the purchase of recycled products pursuant to the EPA 
guidelines.



Sec. 226.17  Certifications and representations.

    Unless prohibited by statute or codified regulation, USAID may at 
some future date, allow recipients to submit certifications and 
representations required by statute, executive order, or regulation on 
an annual basis, if the recipients have ongoing and continuing 
relationships with the agency. Annual certifications and representations 
shall be signed by responsible officials with the authority to ensure 
recipients' compliance with the pertinent requirements.



                   Subpart C--Post-award Requirements

                    Financial and Program Management



Sec. 226.20  Purpose of financial and program management.

    Sections 226.21 through 226.28 prescribe standards for financial 
management systems, methods for making payments and rules for: 
Satisfying cost sharing and matching requirements, accounting for 
program income, budget revision approvals, making audits, determining 
allowability of costs and establishing funds availability.



Sec. 226.21  Standards for financial management systems.

    (a) Recipients shall relate financial data to performance data and 
develop unit cost information whenever practical.
    (b) Recipients' financial management systems shall provide for the 
following.
    (1) Accurate, current and complete disclosure of the financial 
results of

[[Page 825]]

each federally-sponsored project or program in accordance with the 
reporting requirements set forth in Sec. 226.52. While USAID requires 
reporting on an accrual basis, if the recipient maintains its records on 
other than an accrual basis, the recipient shall not be required to 
establish an accrual accounting system. These recipients may develop 
such accrual data for their reports on the basis of an analysis of the 
documentation on hand.
    (2) Records that identify adequately the source and application of 
funds for federally-sponsored activities. These records shall contain 
information pertaining to all Federal awards, authorizations, 
obligations, unobligated balances, assets, outlays, income and interest.
    (3) Effective control over and accountability for all funds, 
property and other assets. Recipients shall adequately safeguard all 
such assets and assure they are used solely for authorized purposes.
    (4) Comparison of outlays with budget amounts for each award. 
Whenever appropriate, financial information should be related to 
performance and unit cost data.
    (5) Written procedures to minimize the time elapsing between the 
transfer of funds to the recipient from the U.S. Treasury and the 
issuance or redemption of checks, warrants or payments by other means 
for program purposes by the recipient. To the extent that the provisions 
of the Cash Management Improvement Act (CMIA) (Pub. L. 101-453) govern, 
payment methods of State agencies, instrumentalities, and fiscal agents 
shall be consistent with CMIA Treasury-State Agreements or the CMIA 
default procedures codified at 31 CFR part 205, ``Withdrawal of Cash 
from the Treasury for Advances under Federal Grant and Other Programs.''
    (6) Written procedures for determining the reasonableness, 
allocability and allowability of costs in accordance with the provisions 
of the applicable Federal cost principles and the terms and conditions 
of the award.
    (7) Accounting records, including cost accounting records, that are 
supported by source documentation.
    (c) Where the Federal Government guarantees or insures the repayment 
of money borrowed by the recipient, USAID, at its discretion, may 
require adequate bonding and insurance if the bonding and insurance 
requirements of the recipient are not deemed adequate to protect the 
interest of the Federal Government.
    (d) USAID may require adequate fidelity bond coverage where the 
recipient lacks sufficient coverage to protect the Federal Government's 
interest.
    (e) Where bonds are required in the situations described above, the 
bonds shall be obtained from companies holding certificates of authority 
as acceptable sureties, as prescribed in 31 CFR part 223, ``Surety 
Companies Doing Business with the United States.''



Sec. 226.22  Payment

    (a) Payment methods shall minimize the time elapsing between the 
transfer of funds from the United States Treasury and the issuance or 
redemption of checks, warrants, or payment by other means by the 
recipients. Payment methods of State agencies or instrumentalities shall 
be consistent with Treasury-State CMIA agreements or default procedures 
codified at 31 CFR part 205.
    (b)(1) Recipients will be paid in advance, provided they maintain or 
demonstrate the willingness to maintain:
    (i) Written procedures that minimize the time elapsing between the 
transfer of funds and disbursement by the recipient, and
    (ii) financial management systems that meet the standards for fund 
control and accountability as established in Section 226.21.
    (2) Cash advances to a recipient organization shall be limited to 
the minimum amounts needed and be timed to be in accordance with the 
actual, immediate cash requirements of the recipient organization in 
carrying out the purpose of the approved program or project. The timing 
and amount of cash advances shall be as close as is administratively 
feasible to the actual disbursements by the recipient organization for 
direct program or project costs and the proportionate share of any 
allowable indirect costs.
    (c) Whenever possible, advances will be consolidated to cover 
anticipated

[[Page 826]]

cash needs for all awards made by USAID to the recipient.
    (1) Advance payment mechanisms include, but are not limited to, 
USAID Letter of Credit, Treasury check and electronic funds transfer.
    (2) Advance payment mechanisms are subject to 31 CFR part 205.
    (3) Recipients will be authorized to submit requests for advances 
and reimbursements at least monthly when electronic fund transfers are 
not used.
    (d) Requests for Treasury check advance payment shall be submitted 
on SF-270, ``Request for Advance or Reimbursement,'' or other forms as 
may be authorized by OMB. This form is not to be used when Treasury 
check advance payments are made to the recipient automatically through 
the use of a predetermined payment schedule or if precluded by special 
USAID instructions for electronic funds transfer.
    (e) Reimbursement is the preferred method when the requirements in 
paragraph (b) of this section cannot be met. USAID may also use this 
method on any construction agreement, or if the major portion of the 
construction project is accomplished through private market financing or 
Federal loans, and the Federal assistance constitutes a minor portion of 
the project.
    (1) When the reimbursement method is used, USAID shall make payment 
within 30 days after receipt of the billing, unless the billing is 
improper.
    (2) Recipients are authorized to submit a request for reimbursement 
at least monthly when electronic funds transfers are not used.
    (f) If a recipient cannot meet the criteria for advance payments and 
USAID has determined that reimbursement is not feasible because the 
recipient lacks sufficient working capital, the USAID Agreement Officer 
may provide cash on a working capital advance basis. Under this 
procedure, USAID shall advance cash to the recipient to cover its 
estimated disbursement needs for an initial period generally geared to 
the recipient's disbursing cycle, normally 30 days. Thereafter, USAID 
shall reimburse the recipient for its actual cash disbursements. The 
working capital advance method of payment will not be used for 
recipients unwilling or unable to provide timely advances to their 
subrecipients to meet the subrecipients' actual cash disbursements.
    (g) To the extent available, recipients shall disburse funds 
available from repayments to and interest earned on a revolving fund, 
program income, rebates, refunds, contract settlements, audit recoveries 
and interest earned on such funds before requesting additional cash 
payments. This paragraph is not applicable to such earnings which are 
generated as foreign currencies.
    (h) Unless otherwise required by statute, USAID will not withhold 
payments for proper charges made by recipients at any time during the 
project period unless:
    (1) A recipient has failed to comply with the project objectives, 
the terms and conditions of the award, or Federal reporting 
requirements, or
    (2) The recipient or subrecipient is delinquent in a debt to the 
United States as defined in OMB Circular A-129, ``Managing Federal 
Credit Programs.'' Under such conditions, USAID may, upon reasonable 
notice, inform the recipient that payments shall not be made for 
obligations incurred after a specified date until the conditions are 
corrected or the indebtedness to the Federal Government is liquidated.
    (i) Standards governing the use of banks and other institutions as 
depositories of funds advanced under awards are as follows.
    (1) Except for situations described in paragraph (i)(2) of this 
section, or as otherwise provided in USAID regulations or implementing 
guidance governing endowment funds, USAID does not require separate 
depository accounts for funds provided to a recipient or establish any 
eligibility requirements for depositories for funds provided to a 
recipient. However, recipients must be able to account for the receipt, 
obligation and expenditure of funds.
    (2) Advances of Federal funds shall be deposited and maintained in 
insured accounts whenever possible.
    (j) Consistent with the national goal of expanding the opportunities 
for women-owned and minority-owned business enterprises, recipients are 
encouraged to use women-owned and minority-owned banks (a bank which is

[[Page 827]]

owned at least 50 percent by women or minority group members).
    (k) Recipients shall maintain advances of Federal funds in interest 
bearing accounts, unless:
    (1) The recipient receives less than $120,000 in Federal awards per 
year,
    (2) The best reasonably available interest bearing account would not 
be expected to earn interest in excess of $250 per year on Federal cash 
balances, or
    (3) The depository would require an average or minimum balance so 
high that it would not be feasible within the expected Federal and non-
Federal cash resources.
    (l) Except as otherwise provided in the terms and conditions of the 
award in accordance with USAID regulations or other implementing 
guidance, for those entities where CMIA and its implementing regulations 
do not apply, interest earned on Federal advances deposited in interest 
bearing accounts shall be remitted annually to Department of Health and 
Human Services, Payment Management System, Rockville, MD 20852. Interest 
amounts up to $250 per year may be retained by the recipient for 
administrative expense. State universities and hospitals shall comply 
with CMIA, as it pertains to interest. If an entity subject to CMIA uses 
its own funds to pay pre-award costs for discretionary awards without 
prior written approval from the Federal awarding agency, it waives its 
right to recover the interest under CMIA.
    (m) Except as noted elsewhere in this part, only the following forms 
shall be authorized for the recipients in requesting advances and 
reimbursements. USAID shall not require more than an original and two 
copies of these forms.
    (1) The SF-270, Request for Advance or Reimbursement, is the 
standard form for all nonconstruction programs when electronic funds 
transfer or predetermined advance methods are not used. USAID has the 
option of using this form for construction programs in lieu of the SF-
271, ``Outlay Report and Request for Reimbursement for Construction 
Programs.''
    (2) The SF-271, Outlay Report and Request for Reimbursement for 
Construction Programs, is the standard form to be used for requesting 
reimbursement for construction programs. However, USAID may substitute 
the SF-270 when it determines that it provides adequate information to 
meet Federal needs.



Sec. 226.23  Cost sharing or matching.

    (a) All contributions, including cash and third party inkind, shall 
be accepted as part of the recipient's cost sharing or matching when 
such contributions meet all of the following criteria.
    (1) Are verifiable from the recipient's records.
    (2) Are not included as contributions for any other federally-
assisted project or program.
    (3) Are necessary and reasonable for proper and efficient 
accomplishment of project or program objectives.
    (4) Are allowable under the applicable cost principles.
    (5) Are not paid by the Federal Government under another award, 
except where authorized by Federal statute to be used for cost sharing 
or matching.
    (6) Are provided for in the approved budget.
    (7) Conform to other provisions of this part, as applicable.
    (b) Unrecovered indirect costs may be included as part of cost 
sharing or matching.
    (c) Values for recipient contributions of services and property 
shall be established in accordance with the applicable cost principles. 
If USAID authorizes recipients to donate buildings or land for 
construction/facilities acquisition projects or long-term use, the value 
of the donated property for cost sharing or matching shall be the lesser 
of:
    (1) The certified value of the remaining life of the property 
recorded in the recipient's accounting records at the time of donation, 
or
    (2) The current fair market value. However, when there is sufficient 
justification, the USAID Agreement Officer may approve the use of the 
current fair market value of the donated property, even if it exceeds 
the certified value at the time of donation to the project.
    (d) Volunteer services furnished by professional and technical 
personnel, consultants, and other skilled and unskilled labor may be 
counted as cost

[[Page 828]]

sharing or matching if the service is an integral and necessary part of 
an approved project or program. Rates for volunteer services shall be 
consistent with those paid for similar work in the recipient's 
organizations. In those instances in which the required skills are not 
found in the recipient organization, rates shall be consistent with 
those paid for similar work in the labor market in which the recipient 
competes for the kind of services involved. In either case, paid fringe 
benefits that are reasonable, allowable, and allocable may be included 
in the valuation.
    (e) When an employer other than the recipient furnishes the services 
of an employee, these services shall be valued at the employee's regular 
rate of pay (plus an amount of fringe benefits that are reasonable, 
allowable, and allocable, but exclusive of overhead costs), provided 
these services are in the same skill for which the employee is normally 
paid.
    (f) Donated supplies may include such items as expendable equipment, 
office supplies, laboratory supplies or workshop and classroom supplies. 
Value assessed to donated supplies included in the cost sharing or 
matching share shall be reasonable and shall not exceed the fair market 
value of the property at the time of the donation.
    (g) The method used for determining cost sharing or matching for 
donated equipment, buildings and land for which title passes to the 
recipient may differ according to the purpose of the award, if:
    (1) If the purpose of the award is to assist the recipient in the 
acquisition of equipment, buildings or land, the total value of the 
donated property may be claimed as cost sharing or matching, or
    (2) If the purpose of the award is to support activities that 
require the use of equipment, buildings or land, normally only 
depreciation or use charges for equipment and buildings may be made. 
However, the full value of equipment or other capital assets and fair 
rental charges for land may be allowed, provided that the USAID 
Agreement Officer has approved the charges.
    (h) The value of donated property shall be determined in accordance 
with the usual accounting policies of the recipient, with the following 
qualifications.
    (1) The value of donated land and buildings shall not exceed its 
fair market value at the time of donation to the recipient as 
established by an independent appraiser (e.g., certified real property 
appraiser or General Services Administration representative) and 
certified by a responsible official of the recipient.
    (2) The value of donated equipment shall not exceed the fair market 
value of equipment of the same age and condition at the time of 
donation.
    (3) The value of donated space shall not exceed the fair rental 
value of comparable space as established by an independent appraisal of 
comparable space and facilities in a privately-owned building in the 
same locality.
    (4) The value of loaned equipment shall not exceed its fair rental 
value.
    (i) The following requirements pertain to the recipient's supporting 
records for in-kind contributions from third parties.
    (1) Volunteer services shall be documented and, to the extent 
feasible, supported by the same methods used by the recipient for its 
own employees,
    (2) The basis for determining the valuation for personal services, 
material, equipment, buildings and land shall be documented.



Sec. 226.24  Program income.

    (a) Recipients shall apply the standards set forth in this section 
to account for program income related to projects financed in whole or 
in part with Federal funds.
    (b) Except as provided in paragraph (h) of this section, program 
income earned during the project period shall be retained by the 
recipient and, in accordance with USAID regulations, other implementing 
guidance, or the terms and conditions of the award, shall be used in one 
or more of the following ways:
    (1) Added to funds committed by USAID and the recipient to the 
project or program, and used to further eligible project or program 
objectives.
    (2) Used to finance the non-Federal share of the project or program.
    (3) Deducted from the total project or program allowable cost in 
determining

[[Page 829]]

the net allowable costs on which the Federal share of costs is based.
    (c) When the agreement authorizes the disposition of program income 
as described in paragraph (b)(1) or (b)(2) of this section, program 
income in excess of any limits stipulated shall be used in accordance 
with paragraph (b)(3) of this section.
    (d) If the terms and conditions of the award do not specify how 
program income is to be used, paragraph (b)(3) of this section shall 
apply automatically to all projects or programs except research. For 
awards that support research, paragraph (b)(1) of this section shall 
apply automatically unless the terms and conditions of the award provide 
another alternative, or the recipient is subject to special award 
conditions, as indicated in Sec. 226.14. Recipients which are commercial 
organizations may not apply paragraph (b)(1) of this section, in 
accordance with Sec. 226.82 of this part.
    (e) Unless the terms and conditions of the award provide otherwise, 
recipients shall have no obligation to the Federal Government regarding 
program income earned after the end of the project period.
    (f) Costs incident to the generation of program income may be 
deducted from gross income to determine program income, provided these 
costs have not been charged to the award and they comply with the cost 
principles applicable to the award funds.
    (g) Proceeds from the sale of property shall be handled in 
accordance with the requirements of the Property Standards (See 
Secs. 226.30 through 226.37).
    (h) Unless the terms and condition of the award provide otherwise, 
recipients shall have no obligation to the Federal Government with 
respect to program income earned from license fees and royalties for 
copyrighted material, patents, patent applications, trademarks, and 
inventions produced under an award. However, Patent and Trademark 
Amendments (35 U.S.C. 18) apply to inventions made under an 
experimental, developmental, or research award.



Sec. 226.25  Revision of budget and program plans.

    (a) The budget plan is the financial expression of the project or 
program as approved during the award process. It may include either the 
sum of the Federal and non-Federal shares, or only the Federal share, 
depending upon USAID requirements as reflected in the terms and 
conditions of the agreement. It shall be related to performance for 
program evaluation purposes whenever appropriate.
    (b) Recipients are required to report deviations from budget and 
program plans, and request prior approvals for budget and program plan 
revisions, in accordance with this section.
    (c) For nonconstruction awards, recipients shall request prior 
approvals from the USAID Agreement Officer for one or more of the 
following program or budget related reasons:
    (1) Change in the scope or the objective of the project or program 
(even if there is no associated budget revision requiring prior written 
approval).
    (2) Change in a key person specified in the application or award 
document.
    (3) The absence for more than three months, or a 25 percent 
reduction in time devoted to the project, by the approved project 
director or principal investigator.
    (4) The need for additional Federal funding.
    (5) The transfer of amounts budgeted for indirect costs to absorb 
increases in direct costs, or vice versa.
    (6) The inclusion, unless waived in the agreement by USAID, of costs 
that require prior approval in accordance with OMB Circular A-21, ``Cost 
Principles for Institutions of Higher Education,'' OMB Circular A-122, 
``Cost Principles for Non-Profit Organizations,'' or 45 CFR part 74, 
Appendix E, ``Principles for Determining Costs Applicable to Research 
and Development under Grants and Contracts with Hospitals,'' or 48 CFR 
part 31, ``Contract Cost Principles and Procedures,'' as applicable.
    (7) The transfer of funds allotted for training allowances (direct 
payment to trainees) to other categories of expense.

[[Page 830]]

    (8) Unless described in the application and funded in the approved 
budget of the award, the subaward, transfer or contracting out of any 
work under an award. This provision does not apply to the purchase of 
supplies, material, equipment or general support services.
    (d) No other prior approval requirements for specific items may be 
imposed unless a deviation has been approved by OMB.
    (e) USAID may waive cost-related and administrative prior written 
approvals required by this part and OMB Circulars A-21 and A-122, except 
for requirements listed in paragraphs (c)(1) and (c)(4) of this section. 
Such waivers may authorize recipients to do any one or more of the 
following:
    (1) Incur pre-award costs 90 calendar days prior to award or more 
than 90 calendar days with the prior approval of the USAID Agreement 
Officer. All pre-award costs are incurred at the recipient's risk (i.e., 
USAID is under no obligation to reimburse such costs if for any reason 
the recipient does not receive an award or if the award is less than 
anticipated and inadequate to cover such costs).
    (2) Initiate a one-time extension of the expiration date of the 
award of up to 12 months. For one-time extensions, the recipient must 
notify the USAID Agreement Officer in writing, with the supporting 
reasons and revised expiration date, at least 10 days before the 
expiration date specified in the award. This one-time extension may not 
be exercised merely for the purpose of using unobligated balances. The 
recipient may initiate a one-time extension unless one or more of the 
following conditions apply:
    (i) The terms and conditions of award prohibit the extension.
    (ii) The extension requires additional Federal funds.
    (iii) The extension involves any change in the approved objectives 
or scope of the project.
    (3) Carry forward unobligated balances to subsequent funding 
periods.
    (4) Except for awards under Section 226.14 and Subpart E of this 
part, for awards that support research, unless USAID provides otherwise 
in the award or in its regulations or other implementing guidance, the 
prior approval requirements described in paragraphs (e) (1) through (3) 
of this section are automatically waived (i.e., recipients need not 
obtain such prior approvals) unless one of the conditions included in 
paragraph (e)(2) of this section applies.
    (f) USAID may, at its option, restrict the transfer of funds among 
direct cost categories or programs, functions and activities for awards 
in which the Federal share of the project exceeds $100,000 and the 
cumulative amount of such transfers exceeds or is expected to exceed 10 
percent of the total budget as last approved by the USAID Agreement 
Officer. USAID shall not permit a transfer that would cause any Federal 
appropriation or part thereof to be used for purposes other than those 
consistent with the original intent of the appropriation.
    (g) All other changes to non-construction budgets, except for the 
changes described in paragraph (j) of this section, do not require prior 
approval.
    (h) For construction awards, recipients shall request prior written 
approval promptly from the USAID Agreement Officer for budget revisions 
whenever:
    (1) The revision results from changes in the scope or the objective 
of the project or program,
    (2) The need arises for additional Federal funds to complete the 
project, or
    (3) A revision is desired which involves specific costs for which 
prior written approval requirements may be imposed consistent with the 
applicable cost principles listed in Sec. 226.27.
    (i) No other prior approval requirements for specific items may be 
imposed unless a deviation has been approved by OMB.
    (j) When USAID makes an award that provides support for both 
construction and nonconstruction work, the USAID Agreement Officer may 
require the recipient to request prior approval before making any fund 
or budget transfers between the two types of work supported.
    (k) For both construction and nonconstruction awards, recipients 
shall notify the USAID Agreement Officer in writing promptly whenever 
the amount of Federal authorized funds is expected

[[Page 831]]

to exceed the needs of the recipient for the project period by more than 
$5000 or five percent of the Federal award, whichever is greater. This 
notification shall not be required if an application for additional 
funding is submitted for a continuation award.
    (l) When requesting approval for budget revisions, recipients shall 
use the budget forms that were used in the application unless the USAID 
Agreement Officer indicates a letter of request suffices.
    (m) Within 30 calendar days from the date of receipt of the request 
for budget revisions, the USAID Agreement Officer shall review the 
request and notify the recipient whether the budget revisions have been 
approved. If the revision is still under consideration at the end of 30 
calendar days, the USAID Agreement Officer shall inform the recipient in 
writing of the date when the recipient may expect the decision.



Sec. 226.26  Non-Federal audits.

    (a) Recipients and subrecipients that are institutions of higher 
education or other non-profit organizations (including hospitals) shall 
be subject to the audit requirements contained in the Single Audit Act 
Amendments of 1996 (31 U.S.C. 7501-7507) and revised OMB Circular A-133, 
``Audits of States, Local Governments, and Non-Profit Organizations.''
    (b) State and local governments shall be subject to the audit 
requirements contained in the Single Audit Act Amendments of 1996 (31 
U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of States, 
Local Governments, and Non-Profit Organizations.''
    (c) For-profit hospitals not covered by the audit provisions of 
revised OMB Circular A-133 shall be subject to the audit requirements of 
the Federal awarding agencies.
    (d) Commercial organizations shall be subject to the audit 
requirements of USAID or the prime recipient as incorporated in the 
award document.
[60 FR 3744, Jan. 19, 1995, as amended at 62 FR 45939, 45941, Aug. 29, 
1997]



Sec. 226.27  Allowable costs.

    For each kind of recipient, there is a set of Federal principles for 
determining allowable costs. Allowability of costs shall be determined 
by the Agreement Officer in accordance with the cost principles 
applicable to the entity incurring the costs. Thus, allowability of 
costs incurred by State, local or federally-recognized Indian tribal 
governments is determined in accordance with the provisions of OMB 
Circular A-87, ``Cost Principles for State and Local Governments.'' The 
allowability of costs incurred by non-profit organizations is determined 
in accordance with the provisions of OMB Circular A-122, ``Cost 
Principles for Non-Profit Organizations.'' The allowability of costs 
incurred by institutions of higher education is determined in accordance 
with the provisions of OMB Circular A-21, ``Cost Principles for 
Educational Institutions.'' The allowability of costs incurred by 
hospitals is determined in accordance with the provisions of Appendix E 
of 45 CFR part 74, ``Principles for Determining Costs Applicable to 
Research and Development Under Grants and Contracts with Hospitals.'' 
The allowability of costs incurred by commercial organizations and those 
non-profit organizations listed in Attachment C to Circular A-122 is 
determined in accordance with the provisions of the Federal Acquisition 
Regulation (FAR) at 48 CFR part 31.



Sec. 226.28  Period of availability of funds.

    Where a funding period is specified, a recipient may charge to the 
award only allowable costs resulting from obligations incurred during 
the funding period and any pre-award costs authorized by the USAID 
Agreement Officer.

                           Property Standards



Sec. 226.30  Purpose of property standards.

    Sections 226.31 through 226.37 set forth uniform standards governing 
management and or disposition of property furnished by the Federal 
Government or whose cost was charged to a project supported by a Federal 
award. USAID shall not impose additional requirements unless 
specifically required by statute. The recipient may use its own property 
management standards and procedures provided it observes the provisions 
of Secs. 226.31 through 226.37.

[[Page 832]]



Sec. 226.31  Insurance coverage.

    Recipients shall, at a minimum, provide the equivalent insurance 
coverage for real property and equipment acquired with Federal funds as 
provided to property owned by the recipient. Federally-owned property 
need not be insured unless required by the terms and conditions of the 
award.



Sec. 226.32  Real property.

    (a) Unless the agreement provides otherwise, title to real property 
shall vest in the recipient subject to the condition that the recipient 
shall use the real property for the authorized purpose of the project as 
long as it is needed and shall not encumber the property without 
approval of the Agreement Officer.
    (b) The recipient shall obtain written approval from the Agreement 
Officer for the use of real property in other federally-sponsored 
projects when the recipient determines that the property is no longer 
needed for the purpose of the original project. Use in other projects 
shall be limited to those under federally-sponsored projects (i.e., 
awards) or programs that have purposes consistent with those authorized 
for support by USAID.
    (c) When the real property is no longer needed as provided in 
paragraphs (a) and (b) of this section, the recipient shall request 
disposition instructions from the Agreement Officer. The Agreement 
Officer will give one or more of the following disposition instructions:
    (1) The recipient may be permitted to retain title without further 
obligation to the Federal Government after it compensates the Federal 
Government for that percentage of the current fair market value of the 
property attributable to the Federal participation in the project.
    (2) The recipient may be directed to sell the property under 
guidelines provided by USAID and pay the Federal Government for that 
percentage of the current fair market value of the property attributable 
to the Federal participation in the project (after deducting actual and 
reasonable selling and fix-up expenses, if any, from the sales 
proceeds). When the recipient is authorized or required to sell the 
property, proper sales procedures shall be established that provide for 
competition to the extent practicable and result in the highest possible 
return.
    (3) The recipient may be directed to transfer title to the property 
to the Federal Government or to an eligible third party provided that, 
in such cases, the recipient shall be entitled to compensation for its 
attributable percentage of the current fair market value of the 
property.



Sec. 226.33  Federally-owned and exempt property.

    (a) Federally-owned property. (1) Title to federally-owned property 
remains vested in the Federal Government. Recipients shall submit 
annually an inventory listing of federally-owned property in their 
custody to USAID. Upon completion of the award or when the property is 
no longer needed, the recipient shall report the property to USAID for 
further Federal agency utilization.
    (2) If USAID has no further need for the property, it shall be 
declared excess and reported to the General Services Administration, 
unless USAID has statutory authority to dispose of the property by 
alternative methods (e.g., the authority provided by the Federal 
Technology Transfer Act (15 U.S.C. 3710(I)) to donate research equipment 
to educational and non-profit organizations in accordance with E.O. 
12821, ``Improving Mathematics and Science Education in Support of the 
National Education Goals.'') Appropriate instructions shall be issued to 
the recipient by USAID.
    (b) Exempt property. When statutory authority exists, USAID has the 
option to vest title to property acquired with Federal funds in the 
recipient without further obligation to the Federal Government and under 
conditions USAID considers appropriate. Such property is ``exempt 
property'' (see definition in Sec. 226.2). Should USAID not establish 
conditions, title to exempt property upon acquisition shall vest in the 
recipient without further obligation to the Federal Government.



Sec. 226.34  Equipment.

    (a) Unless the agreement provides otherwise, title to equipment 
acquired

[[Page 833]]

by a recipient with Federal funds shall vest in the recipient, subject 
to conditions of this part.
    (b) The recipient shall not use equipment acquired with Federal 
funds to provide services to non-Federal outside organizations for a fee 
that is less than private companies charge for equivalent services, 
unless specifically authorized by Federal statute, for as long as the 
Federal Government retains an interest in the equipment.
    (c) The recipient shall use the equipment in the project or program 
for which it was acquired as long as needed, whether or not the project 
or program continues to be supported by Federal funds and shall not 
encumber the property without approval of USAID. When no longer needed 
for the original project or program, the recipient shall use the 
equipment in connection with its other federally-sponsored activities, 
in the following order of priority:
    (1) Activities sponsored by USAID, then
    (2) Activities sponsored by other Federal agencies.
    (d) During the time that equipment is used on the project or program 
for which it was acquired, the recipient shall make it available for use 
on other projects or programs if such other use will not interfere with 
the work on the project or program for which the equipment was 
originally acquired. First preference for such other use shall be given 
to other projects or programs sponsored by USAID; second preference 
shall be given to projects or programs sponsored by other Federal 
agencies. If the equipment is owned by the Federal Government, use on 
other activities not sponsored by the Federal Government shall be 
permissible if authorized by USAID. User charges shall be treated as 
program income.
    (e) When acquiring replacement equipment, the recipient may use the 
equipment to be replaced as trade-in or sell the equipment and use the 
proceeds to offset the costs of the replacement equipment subject to the 
approval of USAID.
    (f) The recipient's property management standards for equipment 
acquired with Federal funds and federally-owned equipment shall include 
all of the following.
    (1) Equipment records shall be maintained accurately and shall 
include the following information.
    (i) A description of the equipment.
    (ii) Manufacturer's serial number, model number, Federal stock 
number, national stock number, or other identification number.
    (iii) Source of the equipment, including the award number.
    (iv) Whether title vests in the recipient, the Federal Government, 
or other specified entity.
    (v) Acquisition date (or date received, if the equipment was 
furnished by the Federal Government) and cost.
    (vi) Information from which one can calculate the percentage of 
Federal participation in the cost of the equipment (not applicable to 
equipment furnished by the Federal Government).
    (vii) Location and condition of the equipment and the date the 
information was reported.
    (viii) Unit acquisition cost.
    (ix) Ultimate disposition data, including date of disposal and sales 
price or the method used to determine current fair market value where a 
recipient compensates USAID for its share.
    (2) Equipment owned by the Federal Government shall be identified to 
indicate Federal ownership.
    (3) A physical inventory of equipment shall be taken and the results 
reconciled with the equipment records at least once every two years. Any 
differences between quantities determined by the physical inspection and 
those shown in the accounting records shall be investigated to determine 
the causes of the difference. The recipient shall, in connection with 
the inventory, verify the existence, current utilization, and continued 
need for the equipment.
    (4) A control system shall be in effect to insure adequate 
safeguards to prevent loss, damage, or theft of the equipment. Any loss, 
damage, or theft of equipment shall be investigated and fully 
documented; if the equipment was owned by the Federal Government, the 
recipient shall promptly notify the Federal awarding agency with whose 
funds the equipment was purchased.
    (5) Adequate maintenance procedures shall be implemented to keep the 
equipment in good condition.

[[Page 834]]

    (6) Where the recipient is authorized or required to sell the 
equipment, proper sales procedures shall be established which provide 
for competition to the extent practicable and result in the highest 
possible return.
    (g) When the recipient no longer needs the equipment, the equipment 
may be used for other activities in accordance with the following 
standards. For equipment with a current per unit fair market value of 
$5000 or more, the recipient may retain the equipment for other uses 
provided that compensation is made to the original Federal awarding 
agency or its successor. The amount of compensation shall be computed by 
applying the percentage of Federal participation in the cost of the 
original project or program to the current fair market value of the 
equipment. If the recipient has no need for USAID-financed equipment, 
the recipient shall request disposition instructions from the Agreement 
Officer. USAID shall determine whether the equipment can be used to meet 
the agency's requirements. If no requirement exists within USAID, the 
availability of the equipment shall be reported to the General Services 
Administration to determine whether a requirement for the equipment 
exists in other Federal agencies. The USAID Agreement Officer shall 
issue instructions to the recipient no later than 120 calendar days 
after the recipient's request and the following procedures shall govern:
    (1) If so instructed or if disposition instructions are not issued 
within 120 calendar days after the recipient's request, the recipient 
shall sell the equipment and reimburse USAID an amount computed by 
applying to the sales proceeds the percentage of Federal participation 
in the cost of the original project or program. However, the recipient 
shall be permitted to deduct and retain from the Federal share $500 or 
ten percent of the proceeds, whichever is less, for the recipient's 
selling and handling expenses.
    (2) If the recipient is instructed to ship the equipment elsewhere, 
the recipient shall be reimbursed by the Federal Government by an amount 
which is computed by applying the percentage of the recipient's 
participation in the cost of the original project or program to the 
current fair market value of the equipment, plus any reasonable shipping 
or interim storage costs incurred.
    (3) If the recipient is instructed to otherwise dispose of the 
equipment, the recipient will be reimbursed by USAID for such costs 
incurred in its disposition.
    (h) USAID reserves the right to transfer the title to the Federal 
Government or to a third party named by the Federal Government when such 
third party is otherwise eligible under existing statutes. Such transfer 
shall be subject to the following standards:
    (1) The equipment shall be appropriately identified in the award or 
otherwise made known to the recipient in writing.
    (2) USAID shall issue disposition instructions within 120 calendar 
days after receipt of a final inventory. The final inventory shall list 
all equipment acquired with award funds and federally-owned equipment. 
If USAID fails to issue disposition instructions within the 120 calendar 
day period, the recipient shall apply the standards of this section, as 
appropriate.
    (3) When USAID exercises its right to take title, the equipment 
shall be subject to the provisions for federally-owned equipment.



Sec. 226.35  Supplies and other expendable equipment.

    (a) Title to supplies and other expendable equipment shall vest in 
the recipient upon acquisition. If there is a residual inventory of 
unused supplies exceeding $5000 in total aggregate value upon 
termination or completion of the project or program and the supplies are 
not needed for any other federally-sponsored project or program, the 
recipient shall retain the supplies for use on non-Federal sponsored 
activities or sell them, but shall, in either case, compensate the 
Federal Government for its share. The amount of compensation shall be 
computed in the same manner as for equipment.
    (b) The recipient shall not use supplies acquired with Federal funds 
to provide services to non-Federal outside organizations for a fee that 
is less than

[[Page 835]]

private companies charge for equivalent services, unless specifically 
authorized by Federal statute as long as the Federal Government retains 
an interest in the supplies.



Sec. 226.36  Intangible property.

    (a) The recipient may copyright any work that is subject to 
copyright and was developed, or for which ownership was purchased, under 
an award. USAID reserves a royalty-free, nonexclusive and irrevocable 
right to reproduce, publish, or otherwise use the work for Federal 
purposes, and to authorize others to do so.
    (b) Recipients are subject to applicable regulations governing 
patents and inventions, including government-wide regulations issued by 
the Department of Commerce at 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and Small Business Firms Under 
Government Grants, Contracts and Cooperative Agreements.''
    (c) Unless waived by USAID, the Federal Government has the right to:
    (1) Obtain, reproduce, publish or otherwise use the data first 
produced under an award; and
    (2) Authorize others to receive, reproduce, publish, or otherwise 
use such data for Federal purposes.
    (d) Title to intangible property and debt instruments acquired under 
an award or subaward vests upon acquisition in the recipient. The 
recipient shall use that property for the originally-authorized purpose, 
and the recipient shall not encumber the property without approval of 
USAID. When no longer needed for the originally authorized purpose, 
disposition of the intangible property shall occur in accordance with 
the provisions of Sec. 226.34(g).



Sec. 226.37  Property trust relationship.

    Real property, equipment, intangible property and debt instruments 
that are acquired or improved with Federal funds shall be held in trust 
by the recipient as trustee for the beneficiaries of the project or 
program under which the property was acquired or improved. Recipients 
shall record liens or other appropriate notices of record to indicate 
that personal or real property has been acquired, improved or 
constructed with Federal funds and that use and disposition conditions 
apply to the property.

                          Procurement Standards



Sec. 226.40  Purpose of procurement standards.

    Sections 226.41 through 226.48 set forth standards for use by 
recipients in establishing procedures for the procurement of supplies 
and other expendable property, equipment, real property and other 
services with Federal funds. These standards are furnished to ensure 
that such materials and services are obtained in an effective manner and 
in compliance with the provisions of applicable Federal statutes and 
executive orders. No additional procurement standards or requirements 
shall be imposed by USAID upon recipients, unless specifically required 
by Federal statute or executive order or approved by OMB.



Sec. 226.41  Recipient responsibilities.

    The standards contained in this section do not relieve the recipient 
of the contractual responsibilities arising under its contract(s). The 
recipient is the responsible authority, without recourse to USAID, 
regarding the settlement and satisfaction of all contractual and 
administrative issues arising out of procurements entered into in 
support of an award or other agreement. This includes disputes, claims, 
protests of award, source evaluation or other matters of a contractual 
nature. Matters concerning violation of statute are to be referred to 
such Federal, State or local authority as may have proper jurisdiction.



Sec. 226.42  Codes of conduct.

    The recipient shall maintain written standards of conduct governing 
the performance of its employees engaged in the award and administration 
of contracts. No employee, officer, or agent shall participate in the 
selection, award, or administration of a contract supported by Federal 
funds if a real or apparent conflict of interest would be involved. Such 
a conflict would arise when the employee, officer, or agent, any member 
of his or her immediate

[[Page 836]]

family, his or her partner, or an organization which employs or is about 
to employ any of the parties indicated herein, has a financial or other 
interest in the firm selected for an award. The officers, employees, and 
agents of the recipient shall neither solicit nor accept gratuities, 
favors, or anything of monetary value from contractors, or parties to 
subagreements. However, recipients may set standards for situations in 
which the financial interest is not substantial or the gift is an 
unsolicited item of nominal value. The standards of conduct shall 
provide for disciplinary actions to be applied for violations of such 
standards by officers, employees, or agents of the recipient.



Sec. 226.43  Competition.

    All procurement transactions shall be conducted in a manner to 
provide, to the maximum extent practical, open and free competition. The 
recipient shall be alert to organizational conflicts of interest as well 
as noncompetitive practices among contractors that may restrict or 
eliminate competition or otherwise restrain trade. In order to ensure 
objective contractor performance and eliminate unfair competitive 
advantage, contractors that develop or draft specifications, 
requirements, statements of work, invitations for bids and/or requests 
for proposals shall be excluded from competing for such procurements. 
Awards shall be made to the bidder or offeror whose bid or offer is 
responsive to the solicitation and is most advantageous to the 
recipient, price, quality and other factors considered. Solicitations 
shall clearly establish all requirements that the bidder or offeror 
shall fulfill in order for the bid or offer to be evaluated by the 
recipient. Any and all bids or offers may be rejected when it is in the 
recipient's interest to do so.



Sec. 226.44  Procurement procedures.

    (a) All recipients shall establish written procurement procedures. 
These procedures shall provide, at a minimum, that:
    (1) Recipients avoid purchasing unnecessary items,
    (2) Where appropriate, an analysis is made of lease and purchase 
alternatives to determine which would be the most economical and 
practical procurement for the Federal Government, and
    (3) Solicitations for goods and services provide for all of the 
following.
    (i) A clear and accurate description of the technical requirements 
for the material, product or service to be procured. In competitive 
procurements, such a description shall not contain features which unduly 
restrict competition.
    (ii) Requirements which the bidder/offeror must fulfill and all 
other factors to be used in evaluating bids or proposals.
    (iii) A description, whenever practicable, of technical requirements 
in terms of functions to be performed or performance required, including 
the range of acceptable characteristics or minimum acceptable standards.
    (iv) The specific features of ``brand name or equal'' descriptions 
that bidders are required to meet when such items are included in the 
solicitation.
    (v) The acceptance, to the extent practicable and economically 
feasible, of products and services dimensioned in the metric system of 
measurement.
    (vi) Preference, to the extent practicable and economically 
feasible, for products and services that conserve natural resources and 
protect the environment and are energy efficient.
    (b) Positive efforts shall be made by recipients to utilize small 
businesses, minority-owned firms, and women's business enterprises, 
whenever possible. Recipients of USAID awards shall take all of the 
following steps to further this goal.
    (1) Ensure that small businesses, minority-owned firms, and women's 
business enterprises are used to the fullest extent practicable.
    (2) Make information on forthcoming opportunities available and 
arrange time frames for purchases and contracts to encourage and 
facilitate participation by small businesses, minority-owned firms, and 
women's business enterprises. To permit USAID, in accordance with the 
small business provisions of the Foreign Assistance Act of 1961, as 
amended, to give United States small business firms an opportunity to 
participate in supplying commodities

[[Page 837]]

and services procured under the award, the recipient shall to the 
maximum extent possible provide the following information to the Office 
of Small Disadvantaged Business Utilization (OSDBU/MRC), USAID 
Washington, DC 20523, at least 45 days prior to placing any order or 
contract in excess of the small purchase threshold:
    (i) Brief general description and quantity of goods or services;
    (ii) Closing date for receiving quotations, proposals or bids; and
    (iii) Address where solicitations or specifications can be obtained.
    (3) Consider in the contract process whether firms competing for 
larger contracts intend to subcontract with small businesses, minority-
owned firms, and women's business enterprises.
    (4) Encourage contracting with consortiums of small businesses, 
minority-owned firms and women's business enterprises when a contract is 
too large for one of these firms to handle individually.
    (5) Use the services and assistance, as appropriate, of such 
organizations as the Small Business Administration and the Department of 
Commerce's Minority Business Development Agency in the solicitation and 
utilization of small businesses, minority-owned firms and women's 
business enterprises.
    (c) The type of procuring instruments used (e.g., fixed price 
contracts, cost reimbursable contracts, purchase orders, and incentive 
contracts) shall be determined by the recipient but shall be appropriate 
for the particular procurement and for promoting the best interest of 
the program or project involved. The ``cost-plus-a-percentage-of-cost'' 
or ``percentage of construction cost'' methods of contracting shall not 
be used.
    (d) Contracts shall be made only with responsible contractors who 
possess the potential ability to perform successfully under the terms 
and conditions of the proposed procurement. Consideration shall be given 
to such matters as contractor integrity, record of past performance, 
financial and technical resources or accessibility to other necessary 
resources. In certain circumstances, contracts with certain parties are 
restricted by agencies' implementation of E.O.s 12549 and 12689, 
``Debarment and Suspension.''
    (e) Recipients shall, on request, make available for USAID, pre-
award review and procurement documents, such as request for proposals or 
invitations for bids, independent cost estimates, etc., when any of the 
following conditions apply.
    (1) A recipient's procurement procedures or operation fails to 
comply with the procurement standards in this part.
    (2) The procurement is expected to exceed the small purchase 
threshold fixed at 41 U.S.C. 403(11) and is to be awarded without 
competition or only one bid or offer is received in response to a 
solicitation.
    (3) The procurement, which is expected to exceed the small purchase 
threshold, specifies a ``brand name'' product.
    (4) The proposed award over the small purchase threshold is to be 
awarded to other than the apparent low bidder under a sealed bid 
procurement.
    (5) A proposed contract modification changes the scope of a contract 
or increases the contract amount by more than the amount of the small 
purchase threshold.



Sec. 226.45  Cost and price analysis.

    Some form of cost or price analysis shall be made and documented in 
the procurement files in connection with every procurement action. Price 
analysis may be accomplished in various ways, including the comparison 
of price quotations submitted, market prices and similar indicia, 
together with discounts. Cost analysis is the review and evaluation of 
each element of cost to determine reasonableness, allocability and 
allowability.



Sec. 226.46  Procurement records.

    Procurement records and files for purchases in excess of the small 
purchase threshold shall include the following at a minimum:
    (a) Basis for contractor selection,
    (b) Justification for lack of competition when competitive bids or 
offers are not obtained, and
    (c) Basis for award cost or price.

[[Page 838]]



Sec. 226.47  Contract administration.

    A system for contract administration shall be maintained to ensure 
contractor conformance with the terms, conditions and specifications of 
the contract and to ensure adequate and timely follow up of all 
purchases. Recipients shall evaluate contractor performance and 
document, as appropriate, whether contractors have met the terms, 
conditions and specifications of the contract.



Sec. 226.48  Contract provisions.

    The recipient shall include, in addition to provisions to define a 
sound and complete agreement, the following provisions in all contracts. 
The following provisions shall also be applied to subcontracts.
    (a) Contracts in excess of the small purchase threshold shall 
contain contractual provisions or conditions that allow for 
administrative, contractual, or legal remedies in instances in which a 
contractor violates or breaches the contract terms, and provide for such 
remedial actions as may be appropriate.
    (b) All contracts in excess of the small purchase threshold shall 
contain suitable provisions for termination by the recipient, including 
the manner by which termination shall be effected and the basis for 
settlement. In addition, such contracts shall describe conditions under 
which the contract may be terminated for default as well as conditions 
where the contract may be terminated because of circumstances beyond the 
control of the contractor.
    (c) Except as otherwise required by statute, an award that requires 
the contracting (or subcontracting) for construction or facility 
improvements shall provide for the recipient to follow its own 
requirements relating to bid guarantees, performance bonds, and payment 
bonds unless the construction contract or subcontract exceeds $100,000. 
For those contracts or subcontracts exceeding $100,000, the USAID 
Agreement Officer may accept the bonding policy and requirements of the 
recipient, provided that USAID determines that the Federal Government's 
interest is adequately protected. In making this determination for 
contract or subcontracts to be performed overseas, the Agreement Officer 
shall take into consideration any established local practices relating 
to security. If such a determination has not been made, the minimum 
requirements shall be as follows.
    (1) A bid guarantee from each bidder equivalent to five percent of 
the bid price. The ``bid guarantee'' shall consist of a firm commitment 
such as a bid bond, certified check, or other negotiable instrument 
accompanying a bid as assurance that the bidder shall, upon acceptance 
of its bid, execute such contractual documents as may be required within 
the time specified.
    (2) A performance bond on the part of the contractor for 100 percent 
of the contract price. A ``performance bond'' is one executed in 
connection with a contract to secure fulfillment of all the contractor's 
obligations under such contract.
    (3) A payment bond on the part of the contractor for 100 percent of 
the contract price. A ``payment bond'' is one executed in connection 
with a contract to assure payment as required by statute of all persons 
supplying labor and material in the execution of the work provided for 
in the contract.
    (4) Where bonds are required, the bonds shall be obtained from 
companies holding certificates of authority as acceptable sureties 
pursuant to 31 CFR part 223, ``Surety Companies Doing Business with the 
United States.''
    (d) All negotiated contracts (except those for less than the small 
purchase threshold) awarded by recipients shall include a provision to 
the effect that the recipient, USAID, the Comptroller General of the 
United States, or any of their duly authorized representatives, shall 
have access to any books, documents, papers and records of the 
contractor which are directly pertinent to a specific program for the 
purpose of making audits, examinations, excerpts and transcriptions.
    (e) All contracts, including small purchases, awarded by recipients 
and their contractors shall contain the procurement provisions of 
Appendix A to this part, as applicable. Whenever a provision is required 
to be inserted in a contract under an agreement, the recipient shall 
insert a statement in the

[[Page 839]]

contract that in all instances where the U.S. Government or USAID is 
mentioned, the recipient's name shall be substituted.



Sec. 226.49  USAID-Specific procurement requirements

    Procurement requirements which are applicable to USAID because of 
statute and regulation are in Subpart G.

                           Reports and Records



Sec. 226.50  Purpose of reports and records.

    Sections 226.51 through 226.53 establish the procedures for 
monitoring and reporting on the recipient's financial and program 
performance and the necessary standard reporting forms. They also set 
forth record retention requirements.



Sec. 226.51  Monitoring and reporting program performance.

    (a) Recipients are responsible for managing and monitoring each 
project, program, subaward, function or activity supported by the award. 
Recipients shall monitor subawards to ensure subrecipients have met the 
audit requirements as delineated in Section 226.26.
    (b) The terms and conditions of the agreement will prescribe the 
frequency with which the performance reports shall be submitted. Except 
as provided in paragraph 226.51(f), performance reports will not be 
required more frequently than quarterly or, less frequently than 
annually. Annual reports shall be due 90 calendar days after the award 
year; quarterly or semi-annual reports shall be due 30 days after the 
reporting period. USAID may require annual reports before the 
anniversary dates of multiple year awards in lieu of these requirements. 
The final performance reports are due 90 calendar days after the 
expiration or termination of the award.
    (c) If inappropriate, a final technical or performance report shall 
not be required after completion of the project.
    (d) Performance reports shall generally contain, for each award, 
brief information on each of the following:
    (1) A comparison of actual accomplishments with the goals and 
objectives established for the period, the findings of the investigator, 
or both. Whenever appropriate and the output of programs or projects can 
be readily quantified, such quantitative data should be related to cost 
data for computation of unit costs.
    (2) Reasons why established goals were not met, if appropriate.
    (3) Other pertinent information including, when appropriate, 
analysis and explanation of cost overruns or high unit costs.
    (e) Recipients shall submit the original and two copies of 
performance reports.
    (f) Recipients shall immediately notify USAID of developments that 
have a significant impact on the award-supported activities. Also, 
notification shall be given in the case of problems, delays, or adverse 
conditions which materially impair the ability to meet the objectives of 
the award. This notification shall include a statement of the action 
taken or contemplated, and any assistance needed to resolve the 
situation.
    (g) USAID may make site visits, as needed.
    (h) USAID shall comply with clearance requirements of 5 CFR part 
1320 when requesting performance data from recipients.



Sec. 226.52  Financial reporting.

    (a) The following forms are used for obtaining financial information 
from recipients.
    (1) SF-269 or SF-269A, Financial Status Report.
    (i) USAID will require recipients to use either the SF-269 or SF-
269A to report the status of funds for all nonconstruction projects or 
programs. The type of form required will be established in the award. 
USAID may, however, have the option of not requiring the SF-269 or SF-
269A when the SF-270, Request for Advance or Reimbursement, or SF-272, 
Report of Federal Cash Transactions, is determined to provide adequate 
information to meet its needs, except that a final SF-269 or SF-269A 
shall be required at the completion of the project when the SF-270 is 
used only for advances.
    (ii) The type of reporting required will be established in the 
agreement. If USAID requires accrual information

[[Page 840]]

and the recipient's accounting records are not normally kept on the 
accrual basis, the recipient shall not be required to convert its 
accounting system, but shall develop such accrual information through 
best estimates based on an analysis of the documentation on hand.
    (iii) USAID will determine the frequency of the Financial Status 
Report for each project or program, considering the size and complexity 
of the particular project or program. The frequency of reports will be 
established in the agreement. However, the report shall not be required 
more frequently than quarterly or less frequently than annually. A final 
report shall be required at the completion of the agreement.
    (iv) Recipients shall submit the SF-269 or SF-269A (an original and 
two copies) no later than 30 days after the end of each specified 
reporting period for quarterly and semi-annual reports, and 90 calendar 
days for annual and final reports. Extensions of reporting due dates may 
be approved by USAID upon request of the recipient.
    (2) SF-272, Report of Federal Cash Transactions.
    (i) When funds are advanced to recipients USAID shall require each 
recipient to submit the SF-272 and, when necessary, its continuation 
sheet, SF-272a. USAID shall use this report to monitor cash advanced to 
recipients and to obtain disbursement information for each agreement 
with the recipients.
    (ii) USAID may require forecasts of Federal cash requirements in the 
``Remarks'' section of the report.
    (iii) When practical and deemed necessary, USAID may require 
recipients to report in the ``Remarks'' section the amount of cash 
advances received in excess of three days. Recipients shall provide 
short narrative explanations of actions taken to reduce the excess 
balances.
    (iv) Recipients shall be required to submit not more than the 
original and two copies of the SF-272 15 calendar days following the end 
of each quarter. USAID may require a monthly report from those 
recipients receiving advances totaling $1 million or more per year.
    (v) USAID may waive the requirement for submission of the SF-272 for 
any one of the following reasons:
    (A) When monthly advances do not exceed $25,000 per recipient, 
provided that such advances are monitored through other forms contained 
in this section;
    (B) If, in USAID's opinion, the recipient's accounting controls are 
adequate to minimize excessive Federal advances; or,
    (C) When the electronic payment mechanisms provide adequate data.
    (b) When USAID needs additional information or more frequent 
reports, the following shall be observed.
    (1) When additional information is needed to comply with legislative 
requirements, USAID shall issue instructions to require recipients to 
submit such information under the ``Remarks'' section of the reports.
    (2) When USAID determines that a recipient's accounting system does 
not meet the standards in Section 226.21, additional pertinent 
information to further monitor awards may be obtained upon written 
notice to the recipient until such time as the system is brought up to 
standard. USAID, in obtaining this information, shall comply with report 
clearance requirements of 5 CFR part 1320.
    (3) USAID may accept the identical information from the recipients 
in machine readable format or computer printouts or electronic outputs 
in lieu of prescribed formats.
    (4) USAID may provide computer or electronic outputs to recipients 
when such expedites or contributes to the accuracy of reporting.



Sec. 226.53  Retention and access requirements for records.

    (a) This section sets forth requirements for record retention and 
access to records for awards to recipients. USAID shall not impose any 
other record retention or access requirements upon recipients.
    (b) Financial records, supporting documents, statistical records, 
and all other records pertinent to an award shall be retained for a 
period of three years from the date of submission of the final 
expenditure report or, for awards that are renewed quarterly or

[[Page 841]]

annually, from the date of the submission of the quarterly or annual 
financial report, as authorized by USAID. The only exceptions are the 
following:
    (1) If any litigation, claim, or audit is started before the 
expiration of the 3-year period, the records shall be retained until all 
litigation, claims or audit findings involving the records have been 
resolved and final action taken.
    (2) Records for real property and equipment acquired with Federal 
funds shall be retained for 3 years after final disposition.
    (3) When records are transferred to or maintained by USAID, the 3-
year retention requirements is not applicable to the recipient.
    (4) Indirect cost rate proposals, cost allocations plans, etc. as 
specified in paragraph 226.53(g).
    (c) Copies of original records may be substituted for the original 
records if authorized by USAID.
    (d) USAID shall request transfer of certain records to its custody 
from recipients when it determines that the records possess long term 
retention value. However, in order to avoid duplicate recordkeeping, 
USAID may make arrangements for recipients to retain any records that 
are continuously needed for joint use.
    (e) USAID, the Inspector General, Comptroller General of the United 
States, or any of their duly authorized representatives, have the right 
of timely and unrestricted access to any books, documents, papers, or 
other records of recipients that are pertinent to the awards, in order 
to make audits, examinations, excerpts, transcripts and copies of such 
documents. This right also includes timely and reasonable access to a 
recipient's personnel for the purpose of interview and discussion 
related to such documents. The rights of access in this paragraph are 
not limited to the required retention period, but shall last as long as 
records are retained.
    (f) Unless required by statute, USAID will not place restrictions on 
recipients that limit public access to the records of recipients that 
are pertinent to an award, except when USAID can demonstrate that such 
records shall be kept confidential and would have been exempted from 
disclosure pursuant to the Freedom of Information Act (5 U.S.C. 552) if 
the records had belonged to USAID.
    (g) Indirect cost rate proposals, cost allocations plans, etc. 
Paragraphs (g)(1) and (g)(2) of this section apply to the following 
types of documents, and their supporting records: indirect cost rate 
computations or proposals, cost allocation plans, and any similar 
accounting computations of the rate at which a particular group of costs 
is chargeable (such as computer usage chargeback rates or composite 
fringe benefit rates).
    (1) If submitted for negotiation. If the recipient submits to the 
Federal awarding agency or the subrecipient submits to the recipient the 
proposal, plan, or other computation to form the basis for negotiation 
of the rate, then the 3-year retention period for its supporting records 
starts on the date of such submission.
    (2) If not submitted for negotiation. If the recipient is not 
required to submit to the Federal awarding agency or the subrecipient is 
not required to submit to the recipient the proposal, plan, or other 
computation for negotiation purposes, then the 3-year retention period 
for the proposal, plan, or other computation and its supporting records 
starts at the end of the fiscal year (or other accounting period) 
covered by the proposal, plan, or other computation.

                 Suspension, Termination and Enforcement



Sec. 226.60  Purpose of suspension, termination and enforcement.

    Sections 226.61 and 226.62 set forth uniform suspension, termination 
and enforcement procedures.



Sec. 226.61  Suspension and termination.

    (a) Awards may be terminated (or, with respect to paragraphs (a) (1) 
and (3) of this section, suspended) in whole or in part if any of the 
circumstances stated in paragraphs (a)(1) through (4) of this section 
apply.
    (1) By USAID, if a recipient materially fails to comply with the 
terms and conditions of an award.

[[Page 842]]

    (2) By USAID with the consent of the recipient, in which case the 
two parties shall agree upon the termination conditions, including the 
effective date and, in the case of partial termination, the portion to 
be terminated.
    (3) If at any time USAID determines that continuation of all or part 
of the funding for a program should be suspended or terminated because 
such assistance would not be in the national interest of the United 
States or would be in violation of an applicable law, then USAID may, 
following notice to the recipient, suspend or terminate the award in 
whole or in part and prohibit the recipient from incurring additional 
obligations chargeable to the award other than those costs specified in 
the notice of suspension. If a suspension is effected and the situation 
causing the suspension continues for 60 days or more, then USAID may 
terminate the award in whole or in part on written notice to the 
recipient and cancel any portion of the award which has not been 
disbursed or irrevocably committed to third parties.
    (4) By the recipient upon sending to USAID written notification 
setting forth the reasons for such termination, the effective date, and, 
in the case of partial termination, the portion to be terminated. 
However, if USAID determines in the case of partial termination that the 
reduced or modified portion of the award will not accomplish the 
purposes for which the grant was made, it may terminate the award in its 
entirety under paragraph (a)(1), (a)(2) or (a)(3) of this section.
    (b) If costs are allowed under an award, the responsibilities of the 
recipient referred to in paragraph 226.71(a), including those for 
property management as applicable, shall be considered in the 
termination of the award, and provision shall be made for continuing 
responsibilities of the recipient after termination, as appropriate.



Sec. 226.62  Enforcement.

    (a) Remedies for noncompliance. If a recipient materially fails to 
comply with the terms and conditions of an award, whether stated in a 
Federal statute, regulation, assurance, application, or notice of award, 
USAID may, in addition to imposing any of the special conditions 
outlined in Sec. 226.14, take one or more of the following actions, as 
appropriate in the circumstances.
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the recipient or more severe enforcement action by USAID.
    (2) Disallow (that is, deny both use of funds and any applicable 
matching credit for) all or part of the cost of the activity or action 
not in compliance.
    (3) Wholly or partly suspend or terminate the current award.
    (4) Withhold further awards for the project or program.
    (5) Take other remedies that may be legally available.
    (b) Hearings and appeals. The recipient may appeal, in accordance 
with Subpart F, any action taken by USAID on which a dispute exists and 
a decision by the Agreement Officer has been obtained. There is no right 
to a hearing on such an appeal.
    (c) Effects of suspension and termination. Costs of a recipient 
resulting from obligations incurred by the recipient during a suspension 
or after termination of an award are not allowable unless USAID 
expressly authorizes them in the notice of suspension or termination or 
subsequently. Other recipient costs during suspension or after 
termination which are necessary and not reasonably avoidable are 
allowable if:
    (1) The costs result from obligations which were properly incurred 
by the recipient before the effective date of suspension or termination, 
are not in anticipation of it, and in the case of a termination, are 
noncancellable, and
    (2) The costs would be allowable if the award were not suspended or 
expired normally at the end of the funding period in which the 
termination takes effect.
    (d) Relationship to debarment and suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude a recipient from being subject to debarment 
and suspension under E.O.s 12549 and 12689 and USAID's implementing 
regulations (see 22 CFR Part 208).

[[Page 843]]



                 Subpart D--After-the-Award Requirements



Sec. 226.70  Purpose.

    Sections 226.71 through 226.73 contain closeout procedures and other 
procedures for subsequent disallowances and adjustments.



Sec. 226.71  Closeout procedures.

    (a) Recipients shall submit, within 90 calendar days after the date 
of completion of the award, all financial, performance, and other 
reports as required by the terms and conditions of the award. USAID may 
approve extensions when requested by the recipient.
    (b) Unless USAID authorizes an extension, a recipient shall 
liquidate all obligations incurred under the award not later than 90 
calendar days after the funding period or the date of completion as 
specified in the terms and conditions of the award or in agency 
implementing instructions.
    (c) USAID will make prompt payments to a recipient for allowable 
reimbursable costs under the award being closed out.
    (d) The recipient shall promptly refund any balances of unobligated 
cash that USAID has advanced or paid and that is not authorized to be 
retained by the recipient for use in other projects. OMB Circular A-129 
governs unreturned amounts that become delinquent debts.
    (e) When authorized by the terms and conditions of the award, USAID 
shall make a settlement for any upward or downward adjustments to the 
Federal share of costs after closeout reports are received.
    (f) The recipient shall account for any real and personal property 
acquired with Federal funds or received from the Federal Government in 
accordance with Secs. 226.31 through 226.37.
    (g) In the event a final audit has not been performed prior to the 
closeout of an award, USAID retains the right to recover an appropriate 
amount after fully considering the recommendations on disallowed costs 
resulting from the final audit.



Sec. 226.72  Subsequent adjustments and continuing responsibilities.

    (a) The closeout of an award does not affect any of the following.
    (1) The right of USAID to disallow costs and recover funds on the 
basis of a later audit or other review.
    (2) The obligation of the recipient to return any funds due as a 
result of later refunds, corrections, or other transactions.
    (3) Audit requirements in Secs. 226.26.
    (4) Property management requirements in Secs. 226.31 through 226.37.
    (5) Records retention as required in Sec. 226.53.
    (b) After closeout of an award, a relationship created under an 
award may be modified or ended in whole or in part with the consent of 
USAID and the recipient, provided the responsibilities of the recipient 
referred to in paragraph 226.73(a), including those for property 
management as applicable, are considered and provisions made for 
continuing responsibilities of the recipient, as appropriate.



Sec. 226.73  Collection of amounts due.

    (a) Any funds paid to a recipient in excess of the amount to which 
the recipient is finally determined to be entitled under the terms and 
conditions of the award constitute a debt to the Federal Government. 
USAID reserves the right to require refund by the recipient of any 
amount which USAID determines to have been expended for purposes not in 
accordance with the terms and condition of the award, including but not 
limited to costs which are not allowable in accordance with the 
applicable Federal cost principles or other terms and conditions of the 
award. If not paid within a reasonable period after the demand for 
payment, USAID may reduce the debt by:
    (1) Making an administrative offset against other requests for 
reimbursements,
    (2) Withholding advance payments otherwise due to the recipient, or
    (3) Taking other action permitted by law.
    (b) Except as otherwise provided by law, USAID will charge interest 
on an overdue debt in accordance with 4 CFR Chapter II, ``Federal Claims 
Collection Standards.''

[[Page 844]]



 Subpart E--Additional Provisions For Awards to Commercial Organizations



Sec. 226.80  Scope of subpart.

    This subpart contains additional provisions that apply to awards to 
commercial organizations. These provisions supplement and make 
exceptions for awards to commercial organizations from other provisions 
of this part.



Sec. 226.81  Prohibition against profit.

    No funds shall be paid as profit to any recipient that is a 
commercial organization. Profit is any amount in excess of allowable 
direct and indirect costs.



Sec. 226.82  Program income.

    The additional costs alternative described in Sec. 226.24(b)(1) may 
not be applied to program income earned by a commercial organization.



                        Subpart F--Miscellaneous



Sec. 226.90  Disputes.

    (a) Any dispute under or relating to a grant or agreement shall be 
decided by the USAID Agreement Officer. The Agreement Officer shall 
furnish the recipient a written copy of the decision.
    (b) Decisions of the USAID Agreement Officer shall be final unless, 
within 30 days of receipt of the decision, the grantee appeals the 
decision to USAID's Deputy Assistant Administrator for Management, 
USAID, Washington, DC 20523. Appeals must be in writing with a copy 
concurrently furnished to the Agreement Officer.
    (c) In order to facilitate review on the record by the Deputy 
Assistant Administrator for Management, the recipient shall be given an 
opportunity to submit written evidence in support of its appeal. No 
hearing will be provided.
    (d) Decisions by the Deputy Assistant Administrator for Management 
shall be final.



                 Subpart G--USAID-Specific Requirements



Sec. 226.1001  Eligibility rules for goods and services. [Reserved]



Sec. 226.1002  Local cost financing. [Reserved]



Sec. 226.1003  Air transportation. [Reserved]



Sec. 226.1004  Ocean shipment of goods. [Reserved]

               Appendix A to Part 226--Contract Provisions

    All contracts, awarded by a recipient including small purchases, 
shall contain the following provisions as applicable:
    1. Equal Employment Opportunity-- All contracts to be performed in 
the United States, or to be performed with employees who were recruited 
in the United States, shall contain a provision requiring compliance 
with E.O. 11246, ``Equal Employment Opportunity,'' as amended by E.O. 
11375, ``Amending Executive Order 11246 Relating to Equal Employment 
Opportunity,'' and as supplemented by regulations at 41 CFR Chapter 60, 
``Office of Federal Contract Compliance Programs, Equal Employment 
Opportunity, Department of Labor,'' to the extent required by the 
foregoing.
    2. Copeland ``Anti-Kickback'' Act (18 U.S.C. 874 and 40 U.S.C. 
276c)-- All contracts and subawards in excess of $2,000 for construction 
or repair to be performed in the United States awarded by recipients and 
subrecipients shall include a provision for compliance with the Copeland 
``Anti-Kickback'' Act (18 U.S.C. 874), as supplemented by Department of 
Labor regulations (29 CFR part 3, ``Contractors and Subcontractors on 
Public Building or Public Work Financed in Whole or in Part by Loans or 
Grants from the United States''). The Act provides that each contractor 
or subrecipient shall be prohibited from inducing, by any means, any 
person employed in the construction, completion, or repair of public 
work, to give up any part of the compensation to which he is otherwise 
entitled. The recipient shall report all suspected or reported 
violations to the Federal awarding agency.
    3. Davis-Bacon Act, as amended (40 U.S.C. 276a to a-7)-- When 
required by Federal program legislation, all construction, alteration, 
and/or repair contracts to be performed in the United States awarded by 
the recipients and subrecipients of more than

[[Page 845]]

$2,000 shall include a provision for compliance with the Davis-Bacon Act 
(40 U.S.C. 276a to a-7) and as supplemented by Department of Labor 
regulations (29 CFR part 5, ``Labor Standards Provisions Applicable to 
Contracts Governing Federally Financed and Assisted Construction''). 
Under this Act, contractors shall be required to pay wages to laborers 
and mechanics at a rate not less than the minimum wages specified in a 
wage determination made by the Secretary of Labor. In addition, 
contractors shall be required to pay wages not less than once a week. 
The recipient shall place a copy of the current prevailing wage 
determination issued by the Department of Labor in each solicitation and 
the award of a contract shall be conditioned upon the acceptance of the 
wage determination. The recipient shall report all suspected or reported 
violations to the Federal awarding agency.
    4. Contract Work Hours and Safety Standards Act (40 U.S.C. 327-
333)-- Where applicable, all contracts awarded by recipients in excess 
of $2000 for construction contracts to be performed in the United States 
and in excess of $2500 for other such contracts that involve the 
employment of mechanics or laborers shall include a provision for 
compliance with sections 102 and 107 of the Contract Work Hours and 
Safety Standards Act (40 U.S.C. 327-333), as supplemented by Department 
of Labor regulations (29 CFR part 5). Under section 102 of the Act, each 
contractor shall be required to compute the wages of every mechanic and 
laborer on the basis of a standard work week of 40 hours. Work in excess 
of the standard work week is permissible provided that the worker is 
compensated at a rate of not less than 1\1/2\ times the basic rate of 
pay for all hours worked in excess of 40 hours in the work week. Section 
107 of the Act is applicable to construction work and provides that no 
laborer or mechanic shall be required to work in surroundings or under 
working conditions which are unsanitary, hazardous or dangerous. These 
requirements do not apply to the purchases of supplies or materials or 
articles ordinarily available on the open market, or contracts for 
transportation or transmission of intelligence.
    5. Rights to Inventions Made Under a Contract or Agreement-- 
Contracts or agreements for the performance of experimental, 
developmental, or research work shall provide for the rights of the 
Federal Government and the recipient in any resulting invention in 
accordance with 37 CFR part 401, ``Rights to Inventions Made by 
Nonprofit Organizations and Small Business Firms Under Government 
Grants, Contracts and Cooperative Agreements,'' and any implementing 
regulations issued by the awarding agency.
    6. Clean Air Act (42 U.S.C. 7401 et seq.) and the Federal Water 
Pollution Control Act (33 U.S.C. 1251 et seq.), as amended-- Contracts 
and subawards of amounts in excess of $100,000 to be performed in the 
United States shall contain a provision that requires the recipient to 
agree to comply with all applicable standards, orders or regulations 
issued pursuant to the Clean Air Act (42 U.S.C. 7401 et seq.) and the 
Federal Water Pollution Control Act as amended (33 U.S.C. 1251 et seq.). 
Violations shall be reported to the Federal awarding agency and the 
Regional Office of the Environmental Protection Agency (EPA).
    7. Byrd Anti-Lobbying Amendment (31 U.S.C. 1352)-- Contractors who 
apply or bid for an award exceeding $100,000 shall file the required 
certification. Each tier certifies to the tier above that it will not 
and has not used Federal appropriated funds to pay any person or 
organization for influencing or attempting to influence an officer or 
employee of any agency, a member of Congress, officer or employee of 
Congress, or an employee of a member of Congress in connection with 
obtaining any Federal contract, grant or any other award covered by 31 
U.S.C. 1352. Each tier shall also disclose any lobbying with non-Federal 
funds that takes place in connection with obtaining any Federal award. 
Such disclosures are forwarded from tier to tier up to the recipient.
    8. Debarment and Suspension (E.O.s 12549 and 12689)-- Certain 
contracts shall not be made to parties listed on the nonprocurement 
portion of the General Services Administration's ``Lists of Parties 
Excluded from Federal Procurement or Nonprocurement Programs'' in 
accordance with E.O.s 12549 and 12689, ``Debarment and Suspension.'' 
This list contains the names of parties debarred, suspended, or 
otherwise excluded by agencies, and contractors declared ineligible 
under statutory or regulatory authority other than E.O. 12549. 
Contractors with awards that exceed the small purchase threshold shall 
provide the required certification regarding its exclusion status and 
that of its principals.
    9. Contracts which require performance outside the United States 
shall contain a provision requiring Worker's Compensation Insurance (42 
U.S.C. 1651, et seq.). As a general rule, Department of Labor waivers 
will be obtained for persons employed outside the United States who are 
not United States citizens or residents provided adequate protection 
will be given such persons. The recipient should refer questions on this 
subject to the USAID Agreement Officer.



PART 227--NEW RESTRICTIONS ON LOBBYING--Table of Contents




                           Subpart A--General

Sec.
227.100  Conditions on use of funds.
227.105  Definitions.

[[Page 846]]

227.110  Certification and disclosure.

                 Subpart B--Activities by Own Employees

227.200  Agency and legislative liaison.
227.205  Professional and technical services.
227.210  Reporting.

            Subpart C--Activities by Other Than Own Employees

227.300  Professional and technical services.

                  Subpart D--Penalties and Enforcement

227.400  Penalties.
227.405  Penalty procedures.
227.410  Enforcement.

                          Subpart E--Exemptions

227.500  Secretary of Defense.

                        Subpart F--Agency Reports

227.600  Semi-annual compilation.
227.605  Inspector General report.

Appendix A to Part 227--Certification Regarding Lobbying
Appendix B to Part 227--Disclosure Form to Report Lobbying

    Authority:  Section 319, Public Law 101-121 (31 U.S.C. 1352); Sec. 
621, Foreign Assistance Act of 1961, as amended, 75 Stat. 445 (22 U.S.C. 
2381).

    Cross reference:  See also Office of Management and Budget notice 
published at 54 FR 52306, December 20, 1989.

    Source: 55 FR 6737 and 6749, Feb. 26, 1990.



                           Subpart A--General



Sec. 227.100  Conditions on use of funds.

    (a) No appropriated funds may be expended by the recipient of a 
Federal contract, grant, loan, or cooperative ageement to pay any person 
for influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with any of the following 
covered Federal actions: the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (b) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or cooperative agreement shall file with that 
agency a certification, set forth in appendix A, that the person has not 
made, and will not make, any payment prohibited by paragraph (a) of this 
section.
    (c) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or a cooperative agreement shall file with that 
agency a disclosure form, set forth in appendix B, if such person has 
made or has agreed to make any payment using nonappropriated funds (to 
include profits from any covered Federal action), which would be 
prohibited under paragraph (a) of this section if paid for with 
appropriated funds.
    (d) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a statement, set forth in appendix A, whether that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.
    (e) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a disclosure form, set forth in appendix B, if that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.



Sec. 227.105  Definitions.

    For purposes of this part:
    (a) Agency, as defined in 5 U.S.C. 552(f), includes Federal 
executive departments and agencies as well as independent regulatory 
commissions and Government corporations, as defined in 31 U.S.C. 
9101(1).
    (b) Covered Federal action means any of the following Federal 
actions:
    (1) The awarding of any Federal contract;
    (2) The making of any Federal grant;

[[Page 847]]

    (3) The making of any Federal loan;
    (4) The entering into of any cooperative agreement; and,
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an agency a 
commitment providing for the United States to insure or guarantee a 
loan. Loan guarantees and loan insurance are addressed independently 
within this part.
    (c) Federal contract means an acquisition contract awarded by an 
agency, including those subject to the Federal Acquisition Regulation 
(FAR), and any other acquisition contract for real or personal property 
or services not subject to the FAR.
    (d) Federal cooperative agreement means a cooperative agreement 
entered into by an agency.
    (e) Federal grant means an award of financial assistance in the form 
of money, or property in lieu of money, by the Federal Government or a 
direct appropriation made by law to any person. The term does not 
include technical assistance which provides services instead of money, 
or other assistance in the form of revenue sharing, loans, loan 
guarantees, loan insurance, interest subsidies, insurance, or direct 
United States cash assistance to an individual.
    (f) Federal loan means a loan made by an agency. The term does not 
include loan guarantee or loan insurance.
    (g) Indian tribe and tribal organization have the meaning provided 
in section 4 of the Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions 
of Indian tribes in that Act.
    (h) Influencing or attempting to influence means making, with the 
intent to influence, any communication to or appearance before an 
officer or employee or any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with any covered Federal action.
    (i) Loan guarantee and loan insurance means an agency's guarantee or 
insurance of a loan made by a person.
    (j) Local government means a unit of government in a State and, if 
chartered, established, or otherwise recognized by a State for the 
performance of a governmental duty, including a local public authority, 
a special district, an intrastate district, a council of governments, a 
sponsor group representative organization, and any other instrumentality 
of a local government.
    (k) Officer or employee of an agency includes the following 
individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, U.S. Code, including a position under a temporary 
appointment;
    (2) A member of the uniformed services as defined in section 101(3), 
title 37, U.S. Code;
    (3) A special Government employee as defined in section 202, title 
18, U.S. Code; and,
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the Federal Advisory Committee Act, title 5, U.S. Code 
appendix 2.
    (l) Person means an individual, corporation, company, association, 
authority, firm, partnership, society, State, and local government, 
regardless of whether such entity is operated for profit or not for 
profit. This term excludes an Indian tribe, tribal organization, or any 
other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (m) Reasonable compensation means, with respect to a regularly 
employed officer or employee of any person, compensation that is 
consistent with the normal compensation for such officer or employee for 
work that is not furnished to, not funded by, or not furnished in 
cooperation with the Federal Government.
    (n) Reasonable payment means, with respect to perfessional and other 
technical services, a payment in an amount that is consistent with the 
amount normally paid for such services in the private sector.
    (o) Recipient includes all contractors, subcontractors at any tier, 
and subgrantees at any tier of the recipient of funds received in 
connection with a Federal contract, grant, loan, or cooperative 
agreement. The term excludes

[[Page 848]]

an Indian tribe, tribal organization, or any other Indian organization 
with respect to expenditures specifically permitted by other Federal 
law.
    (p) Regularly employed means, with respect to an officer or employee 
of a person requesting or receiving a Federal contract, grant, loan, or 
cooperative agreement or a commitment providing for the United States to 
insure or guarantee a loan, an officer or employee who is employed by 
such person for at least 130 working days within one year immediately 
preceding the date of the submission that initiates agency consideration 
of such person for receipt of such contract, grant, loan, cooperative 
agreement, loan insurance commitment, or loan guarantee commitment. An 
officer or employee who is employed by such person for less than 130 
working days within one year immediately preceding the date of the 
submission that initiates agency consideration of such person shall be 
considered to be regularly employed as soon as he or she is employed by 
such person for 130 working days.
    (q) State means a State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, a territory or possession of 
the United States, an agency or instrumentality of a State, and a multi-
State, regional, or interstate entity having governmental duties and 
powers.



Sec. 227.110  Certification and disclosure.

    (a) Each person shall file a certification, and a disclosure form, 
if required, with each submission that initiates agency consideration of 
such person for:
    (1) Award of a Federal contract, grant, or cooperative agreement 
exceeding $100,000; or
    (2) An award of a Federal loan or a commitment providing for the 
United States to insure or guarantee a loan exceeding $150,000.
    (b) Each person shall file a certification, and a disclosure form, 
if required, upon receipt by such person of:
    (1) A Federal contract, grant, or cooperative agreement exceeding 
$100,000; or
    (2) A Federal loan or a commitment providing for the United States 
to insure or guarantee a loan exceeding $150,000,

Unless such person previously filed a certification, and a disclosure 
form, if required, under paragraph (a) of this section.
    (c) Each person shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that requires 
disclosure or that materially affects the accuracy of the information 
contained in any disclosure form previously filed by such person under 
paragraphs (a) or (b) of this section. An event that materially affects 
the accuracy of the information reported includes:
    (1) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (2) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or,
    (3) A change in the officer(s), employee(s), or Member(s) contacted 
to influence or attempt to influence a covered Federal action.
    (d) Any person who requests or receives from a person referred to in 
paragraphs (a) or (b) of this section:
    (1) A subcontract exceeding $100,000 at any tier under a Federal 
contract;
    (2) A subgrant, contract, or subcontract exceeding $100,000 at any 
tier under a Federal grant;
    (3) A contract or subcontract exceeding $100,000 at any tier under a 
Federal loan exceeding $150,000; or,
    (4) A contract or subcontract exceeding $100,000 at any tier under a 
Federal cooperative agreement,

Shall file a certification, and a disclosure form, if required, to the 
next tier above.
    (e) All disclosure forms, but not certifications, shall be forwarded 
from tier to tier until received by the person referred to in paragraphs 
(a) or (b) of this section. That person shall forward all disclosure 
forms to the agency.
    (f) Any certification or disclosure form filed under paragraph (e) 
of this section shall be treated as a material representation of fact 
upon which all receiving tiers shall rely. All liability arising from an 
erroneous representation shall be borne solely by the tier

[[Page 849]]

filing that representation and shall not be shared by any tier to which 
the erroneous representation is forwarded. Submitting an erroneous 
certification or disclosure constitutes a failure to file the required 
certification or disclosure, respectively. If a person fails to file a 
required certification or disclosure, the United States may pursue all 
available remedies, including those authorized by section 1352, title 
31, U.S. Code.
    (g) For awards and commitments in process prior to December 23, 
1989, but not made before that date, certifications shall be required at 
award or commitment, covering activities occurring between December 23, 
1989, and the date of award or commitment. However, for awards and 
commitments in process prior to the December 23, 1989 effective date of 
these provisions, but not made before December 23, 1989, disclosure 
forms shall not be required at time of award or commitment but shall be 
filed within 30 days.
    (h) No reporting is required for an activity paid for with 
appropriated funds if that activity is allowable under either subpart B 
or C.



                 Subpart B--Activities by Own Employees



Sec. 227.200  Agency and legislative liaison.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 227.100 (a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement if 
the payment is for agency and legislative liaison activities not 
directly related to a covered Federal action.
    (b) For purposes of paragraph (a) of this section, providing any 
information specifically requested by an agency or Congress is allowable 
at any time.
    (c) For purposes of paragraph (a) of this section, the following 
agency and legislative liaison activities are allowable at any time only 
where they are not related to a specific solicitation for any covered 
Federal action:
    (1) Discussing with an agency (including individual demonstrations) 
the qualities and characteristics of the person's products or services, 
conditions or terms of sale, and service capabilities; and,
    (2) Technical discussions and other activities regarding the 
application or adaptation of the person's products or services for an 
agency's use.
    (d) For purposes of paragraph (a) of this section, the following 
agencies and legislative liaison activities are allowable only where 
they are prior to formal solicitation of any covered Federal action:
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and,
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Public Law 95-507 and other subsequent amendments.
    (e) Only those activities expressly authorized by this section are 
allowable under this section.



Sec. 227.205  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 227.100 (a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement or 
an extension, continuation, renewal, amendment, or modification of a 
Federal contract, grant, loan, or cooperative agreement if payment is 
for professional or technical services rendered directly in the 
preparation, submission, or negotiation of any bid, proposal, or 
application for that Federal contract, grant, loan, or cooperative 
agreement or for meeting requirements imposed by or pursuant to law as a 
condition for receiving that Federal contract, grant, loan, or 
cooperative agreement.
    (b) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any

[[Page 850]]

professional or technical discipline. For example, drafting of a legal 
document accompanying a bid or proposal by a lawyer is allowable. 
Similarly, technical advice provided by an engineer on the performance 
or operational capability of a piece of equipment rendered directly in 
the negotiation of a contract is allowable. However, communications with 
the intent to influence made by a professional (such as a licensed 
lawyer) or a technical person (such as a licensed accountant) are not 
allowable under this section unless they provide advice and analysis 
directly applying their professional or technical expertise and unless 
the advice or analysis is rendered directly and solely in the 
preparation, submission or negotiation of a covered Federal action. 
Thus, for example, communications with the intent to influence made by a 
lawyer that do not provide legal advice or analysis directly and solely 
related to the legal aspects of his or her client's proposal, but 
generally advocate one proposal over another are not allowable under 
this section because the lawyer is not providing professional legal 
services. Similarly, communications with the intent to influence made by 
an engineer providing an engineering analysis prior to the preparation 
or submission of a bid or proposal are not allowable under this section 
since the engineer is providing technical services but not directly in 
the preparation, submission or negotiation of a covered Federal action.
    (c) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (d) Only those services expressly authorized by this section are 
allowable under this section.



Sec. 227.210  Reporting.

    No reporting is required with respect to payments of reasonable 
compensation made to regularly employed officers or employees of a 
person.



            Subpart C--Activities by Other Than Own Employees



Sec. 227.300  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 227.100 (a), does not apply in the case of any reasonable payment 
to a person, other than an officer or employee of a person requesting or 
receiving a covered Federal action, if the payment is for professional 
or technical services rendered directly in the preparation, submission, 
or negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) The reporting requirements in Sec. 227.110 (a) and (b) regarding 
filing a disclosure form by each person, if required, shall not apply 
with respect to professional or technical services rendered directly in 
the preparation, submission, or negotiation of any commitment providing 
for the United States to insure or guarantee a loan.
    (c) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting or a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of

[[Page 851]]

his or her client's proposal, but generally advocate one proposal over 
another are not allowable under this section because the lawyer is not 
providing professional legal services. Similarly, communications with 
the intent to influence made by an engineer providing an engineering 
analysis prior to the preparation or submission of a bid or proposal are 
not allowable under this section since the engineer is providing 
technical services but not directly in the preparation, submission or 
negotiation of a covered Federal action.
    (d) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (e) Persons other than officers or employees of a person requesting 
or receiving a covered Federal action include consultants and trade 
associations.
    (f) Only those services expressly authorized by this section are 
allowable under this section.



                  Subpart D--Penalties and Enforcement



Sec. 227.400  Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such expenditure.
    (b) Any person who fails to file or amend the disclosure form (see 
appendix B) to be filed or amended if required herein, shall be subject 
to a civil penalty of not less than $10,000 and not more than $100,000 
for each such failure.
    (c) A filing or amended filing on or after the date on which an 
administrative action for the imposition of a civil penalty is commenced 
does not prevent the imposition of such civil penalty for a failure 
occurring before that date. An administrative action is commenced with 
respect to a failure when an investigating official determines in 
writing to commence an investigation of an allegation of such failure.
    (d) In determining whether to impose a civil penalty, and the amount 
of any such penalty, by reason of a violation by any person, the agency 
shall consider the nature, circumstances, extent, and gravity of the 
violation, the effect on the ability of such person to continue in 
business, any prior violations by such person, the degree of culpability 
of such person, the ability of the person to pay the penalty, and such 
other matters as may be appropriate.
    (e) First offenders under paragraphs (a) or (b) of this section 
shall be subject to a civil penalty of $10,000, absent aggravating 
circumstances. Second and subsequent offenses by persons shall be 
subject to an appropriate civil penalty between $10,000 and $100,000, as 
determined by the agency head or his or her designee.
    (f) An imposition of a civil penalty under this section does not 
prevent the United States from seeking any other remedy that may apply 
to the same conduct that is the basis for the imposition of such civil 
penalty.



Sec. 227.405  Penalty procedures.

    Agencies shall impose and collect civil penalties pursuant to the 
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 
sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 
3812, insofar as these provisions are not inconsistent with the 
requirements herein.



Sec. 227.410  Enforcement.

    The head of each agency shall take such actions as are necessary to 
ensure that the provisions herein are vigorously implemented and 
enforced in that agency.



                          Subpart E--Exemptions



Sec. 227.500  Secretary of Defense.

    (a) The Secretary of Defense may exempt, on a case-by-case basis, a 
covered Federal action from the prohibition whenever the Secretary 
determines, in writing, that such an exemption is in the national 
interest. The Secretary shall transmit a copy of each such written 
exemption to Congress immediately after making such a determination.

[[Page 852]]

    (b) The Department of Defense may issue supplemental regulations to 
implement paragraph (a) of this section.



                        Subpart F--Agency Reports



Sec. 227.600  Semi-annual compilation.

    (a) The head of each agency shall collect and compile the disclosure 
reports (see appendix B) and, on May 31 and November 30 of each year, 
submit to the Secretary of the Senate and the Clerk of the House of 
Representatives a report containing a compilation of the information 
contained in the disclosure reports received during the six-month period 
ending on March 31 or September 30, respectively, of that year.
    (b) The report, including the compilation, shall be available for 
public inspection 30 days after receipt of the report by the Secretary 
and the Clerk.
    (c) Information that involves intelligence matters shall be reported 
only to the Select Committee on Intelligence of the Senate, the 
Permanent Select Committee on Intelligence of the House of 
Representatives, and the Committees on Appropriations of the Senate and 
the House of Representatives in accordance with procedures agreed to by 
such committees. Such information shall not be available for public 
inspection.
    (d) Information that is classified under Executive Order 12356 or 
any successor order shall be reported only to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives or the Committees on Armed Services of the 
Senate and the House of Representatives (whichever such committees have 
jurisdiction of matters involving such information) and to the 
Committees on Appropriations of the Senate and the House of 
Representatives in accordance with procedures agreed to by such 
committees. Such information shall not be available for public 
inspection.
    (e) The first semi-annual compilation shall be submitted on May 31, 
1990, and shall contain a compilation of the disclosure reports received 
from December 23, 1989 to March 31, 1990.
    (f) Major agencies, designated by the Office of Management and 
Budget (OMB), are required to provide machine-readable compilations to 
the Secretary of the Senate and the Clerk of the House of 
Representatives no later than with the compilations due on May 31, 1991. 
OMB shall provide detailed specifications in a memorandum to these 
agencies.
    (g) Non-major agencies are requested to provide machine-readable 
compilations to the Secretary of the Senate and the Clerk of the House 
of Representatives.
    (h) Agencies shall keep the originals of all disclosure reports in 
the official files of the agency.



Sec. 227.605  Inspector General report.

    (a) The Inspector General, or other official as specified in 
paragraph (b) of this section, of each agency shall prepare and submit 
to Congress each year, commencing with submission of the President's 
Budget in 1991, an evaluation of the compliance of that agency with, and 
the effectiveness of, the requirements herein. The evaluation may 
include any recommended changes that may be necessary to strengthen or 
improve the requirements.
    (b) In the case of an agency that does not have an Inspector 
General, the agency official comparable to an Inspector General shall 
prepare and submit the annual report, or, if there is no such comparable 
official, the head of the agency shall prepare and submit the annual 
report.
    (c) The annual report shall be submitted at the same time the agency 
submits its annual budget justifications to Congress.
    (d) The annual report shall include the following: All alleged 
violations relating to the agency's covered Federal actions during the 
year covered by the report, the actions taken by the head of the agency 
in the year covered by the report with respect to those alleged 
violations and alleged violations in previous years, and the amounts of 
civil penalties imposed by the agency in the year covered by the report.

[[Page 853]]

        Appendix A to Part 227--Certification Regarding Lobbying

 Certification for Contracts, Grants, Loans, and Cooperative Agreements

    The undersigned certifies, to the best of his or her knowledge and 
belief, that:
    (1) No Federal appropriated funds have been paid or will be paid, by 
or on behalf of the undersigned, to any person for influencing or 
attempting to influence an officer or employee of an agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (2) If any funds other than Federal appropriated funds have been 
paid or will be paid to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
in connection with this Federal contract, grant, loan, or cooperative 
agreement, the undersigned shall complete and submit Standard Form-LLL, 
``Disclosure Form to Report Lobbying,'' in accordance with its 
instructions.
    (3) The undersigned shall require that the language of this 
certification be included in the award documents for all subawards at 
all tiers (including subcontracts, subgrants, and contracts under 
grants, loans, and cooperative agreements) and that all subrecipients 
shall certify and disclose accordingly.
    This certification is a material representation of fact upon which 
reliance was placed when this transaction was made or entered into. 
Submission of this certification is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required certification shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

            Statement for Loan Guarantees and Loan Insurance

    The undersigned states, to the best of his or her knowledge and 
belief, that:
    If any funds have been paid or will be paid to any person for 
influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with this commitment 
providing for the United States to insure or guarantee a loan, the 
undersigned shall complete and submit Standard Form-LLL, ``Disclosure 
Form to Report Lobbying,'' in accordance with its instructions.
    Submission of this statement is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required statement shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

[[Page 854]]



       Appendix B to Part 227--Disclosure Form to Report Lobbying
[GRAPHIC] [TIFF OMITTED] TC06OC91.012


[[Page 855]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.013


[[Page 856]]


[GRAPHIC] [TIFF OMITTED] TC06OC91.014


[[Page 857]]





PART 228--RULES ON SOURCE, ORIGIN AND NATIONALITY FOR COMMODITIES AND SERVICES FINANCED BY USAID--Table of Contents




              Subpart A--Definitions and Scope of This Part

Sec.
228.01  Definitions.
228.02  Scope and application.
228.03  Identification of principal geographic code numbers.

  Subpart B--Conditions Governing Source and Nationality of Commodity 
              Procurement Transactions for USAID Financing

228.10  Purpose.
228.11  Source and origin of commodities.
228.12  Long-term leases.
228.13  Special source rules requiring procurement from the United 
          States.
228.14  Nationality of suppliers of commodities.

  Subpart C--Conditions Governing the Eligibility of Commodity-Related 
                      Services for USAID Financing

228.20  Purpose.
228.21  Ocean transportation.
228.22  Air transportation.
228.23  Eligibility of marine insurance.
228.24  Other delivery services.
228.25  Incidental services.

Subpart D--Conditions Governing the Nationality of Suppliers of Services 
                           for USAID Financing

228.30  Purpose.
228.31  Individuals and privately owned commercial firms.
228.32  Nonprofit organizations.
228.33  Foreign government-owned organizations.
228.34  Joint ventures.
228.35  Construction services from foreign-owned local firms.
228.36  Ineligible suppliers.
228.37  Nationality of employees under contracts or subcontracts for 
          services.
228.38  Miscellaneous service transactions.
228.39  Special source rules for construction and engineering services.

    Subpart E--Conditions Governing Source and Nationality of Local 
              Procurement Transactions for USAID Financing

228.40  Local procurement.

                           Subpart F--Waivers

228.50  General.
228.51  Commodities.
228.52  Suppliers of commodities.
228.53  Suppliers of services--privately owned commercial suppliers and 
          nonprofit organizations.
228.54  Suppliers of services--foreign government-owned organizations.
228.55  Delivery services.
228.56  Authority to approve waivers.

    Authority:  Sec. 621, Pub. L. 87-195, 75 Stat. 445 (22 U.S.C. 2381), 
as amended, E.O. 12163, Sept. 29, 1979, 44 FR 56673: 3 CFR 1979 Comp., 
p. 435.

    Source:  61 FR 53616, Oct. 15, 1996, unless otherwise noted.



              Subpart A--Definitions and Scope of This Part



Sec. 228.01  Definitions.

    As used in this part, the following terms shall have the following 
meanings:
    (a) Commodity means any material, article, supply, goods, or 
equipment.
    (b) Commodity-related services means delivery services and/or 
incidental services.
    (c) Component means any good that goes directly into the production 
of a produced commodity.
    (d) Cooperating country means the country receiving the USAID 
assistance subject to this part 228.
    (e) Delivery means the transfer to, or for the account of, an 
importer of the right to possession of a commodity, or, with respect to 
a commodity-related service, the rendering to, or for the account of, an 
importer of any such service.
    (f) Delivery service means any service customarily performed in a 
commercial export transaction which is necessary to effect a physical 
transfer of commodities to the cooperating country. Examples of such 
services are the following: export packing, local drayage in the source 
country (including waiting time at the dock), ocean and other freight, 
loading, heavy lift, wharfage, tollage, switching, dumping and trimming, 
lighterage, insurance, commodity inspection services, and services of a 
freight forwarder. ``Delivery services'' may also include work and 
materials necessary to meet USAID marking requirements.
    (g) Implementing document means any document, such as a contract, 
grant,

[[Page 858]]

letter of commitment, etc., issued by USAID which authorizes the use of 
USAID funds for the procurement of services or commodities and/or 
commodity related services, and which specifies conditions which apply 
to such procurement.
    (h) Incidental services means the installation or erection of USAID-
financed equipment, or the training of personnel in the maintenance, 
operation and use of such equipment.
    (i) Mission means the USAID Mission or representative in a 
cooperating country.
    (j) Origin means the country where a commodity is mined, grown or 
produced. A commodity is produced when, through manufacturing, 
processing, or substantial and major assembling of components, a 
commercially recognized new commodity results that is significantly 
different in basic characteristics or in purpose of utility from its 
components.
    (k) Services means the performance of identifiable tasks, rather 
than the delivery of an end item of supply.
    (l) Source means the country from which a commodity is shipped to 
the cooperating country, or the cooperating country if the commodity is 
located therein at the time of the purchase. Where, however, a commodity 
is shipped from a free port or bonded warehouse in the form in which 
received therein, ``source'' means the country from which the commodity 
was shipped to the free port or bonded warehouse.
    (m) State means the District of Columbia or any State, commonwealth, 
territory or possession of the United States.
    (n) Supplier means any person or organization, governmental or 
otherwise, who furnishes services, commodities and/or commodity related 
services financed by USAID.
    (o) United States means the United States of America, any State(s) 
of the United States, the District of Columbia, and areas of U.S. 
associated sovereignty, including commonwealths, territories and 
possessions.
    (p) USAID means the U.S. Agency for International Development or any 
successor agency, including when applicable, each USAID Mission abroad.
    (q) USAID Geographic Code means a code in the USAID Geographic Code 
Book which designates a country, a group of countries, or an otherwise 
defined area. The principal USAID geographic codes are described in 
Sec. 228.03.
    (r) USAID/W means the USAID in Washington, DC 20523, including any 
office thereof.



Sec. 228.02  Scope and application.

    This part is applicable to goods and services financed directly with 
program funds under the Foreign Assistance Act of 1961, as amended, 
unless otherwise provided by statute or regulation. If different 
conditions apply to a USAID-financed procurement, by statute or 
regulation, those conditions shall be incorporated in the implementing 
document and shall prevail in the event of any conflict with this part 
228. The implementing documents will indicate the authorized source of 
procurement. The terms and conditions applicable to a procurement of 
goods or services shall be those in effect on the date of the issuance 
of a contract for goods or services by USAID or by the cooperating 
country.



Sec. 228.03  Identification of principal geographic code numbers.

    The USAID Geographic Code Book sets forth the official description 
of all geographic codes used by USAID in authorizing or implementing 
documents, to designate authorized source countries or areas. The 
following are summaries of the principal codes:
    (a) Code 000--The United States: The United States of America, any 
State(s) of the United States, the District of Columbia, and areas of 
U.S.-associated sovereignty, including commonwealths, territories and 
possessions.
    (b) Code 899--Any area or country, except the cooperating country 
itself and the following foreign policy restricted countries: 
Afghanistan, Libya, Vietnam, Cuba, Cambodia, Laos, Iraq, Iran, North 
Korea, Syria and People's Republic of China.
    (c) Code 935--Any area or country including the cooperating country, 
but excluding the foreign policy restricted countries.
    (d) Code 941--The United States and any independent country 
(excluding

[[Page 859]]

foreign policy restricted countries), except the cooperating country 
itself and the following: Albania, Andorra, Angola, Armenia, Austria, 
Australia, Azerbaijan, Bahamas, Bahrain, Belgium, Bosnia and 
Herzegovina, Bulgaria, Belarus, Canada, Croatia, Cyprus, Czech Republic, 
Denmark, Estonia, Finland, France, Gabon, Georgia, Germany, Greece, Hong 
Kong, Hungary, Iceland, Ireland, Italy, Japan, Kazakhstan, Kuwait, 
Kyrgyzstan, Latvia, Liechtenstein, Lithuania, Luxembourg, Macedonia,* 
Malta, Moldova, Monaco, Mongolia, Montenegro,* Netherlands, New Zealand, 
Norway, Poland, Portugal, Qatar, Romania, Russia, San Marino, Saudi 
Arabia, Serbia,* Singapore, Slovak Republic, Slovenia, South Africa, 
Spain, Sweden, Switzerland, Taiwan,* Tajikistan, Turkmenistan, Ukraine, 
United Arab Emirates, United Kingdom, Uzbekistan, and Vatican City.
---------------------------------------------------------------------------


    *Has the status of a ``Geopolitical Entity'', rather than an 
independent country.
---------------------------------------------------------------------------

[61 FR 53616, Oct. 15, 1996; 61 FR 54849, Oct. 22, 1996]



  Subpart B--Conditions Governing Source and Nationality of Commodity 
              Procurement Transactions for USAID Financing



Sec. 228.10  Purpose.

    Sections 228.11 through 228.14 set forth the rules governing the 
eligible source of commodities and nationality of commodity suppliers 
for USAID financing. These rules may be waived in accordance with the 
provisions in subpart F of this part.



Sec. 228.11  Source and origin of commodities.

    (a) The source and origin of a commodity as defined in Sec. 228.01 
shall be a country or countries authorized in the implementing document 
by name or by reference to a USAID geographic code.
    (b) Any component from a foreign policy restricted country makes the 
commodity ineligible for USAID financing.
    (c) When the commodity being purchased is a kit (e.g., scientific 
instruments, tools, or medical supplies packaged as a single unit), the 
kit will be considered a produced commodity.
    (d) When spare parts for vehicles or equipment are purchased, each 
separate shipment will be considered a produced commodity, rather than 
each individual spare or replacement part. The parts must be packed in 
and shipped from an eligible country.
    (e) Systems determination. When a system consisting of more than one 
produced commodity is procured as a single, separately priced item, 
USAID may determine that the system itself shall be considered a 
produced commodity.
    (f) In order to be eligible for USAID financing, when items are 
considered produced commodities under paragraphs (c), (d), or (e) of 
this section, the total cost (to the system supplier) of the commodities 
making up the kit, spare parts, or system which were manufactured in 
countries not included in the authorized geographic code may not exceed 
50 percent of the lowest price (not including ocean transportation and 
marine insurance) at which the supplier makes the final product 
available for export sale.
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]



Sec. 228.12  Long-term leases.

    Any commodity obtained under a long-term lease agreement is subject 
to the source and origin requirements of this subpart B. For purposes of 
this subpart B, a long-term lease is defined as a single lease of more 
than 180 days, or repetitive or intermittent leases under a single 
activity or program within a one-year period totalling more than 180 
days, for the same type of commodity.



Sec. 228.13  Special source rules requiring procurement from the United States.

    (a) Agricultural commodities and products thereof must be procured 
in the United States if the domestic price is less than parity, unless 
the commodity cannot reasonably be procured in the United States in 
fulfillment of the objectives of a particular assistance program under 
which such commodity

[[Page 860]]

procurement is to be financed. (22 U.S.C. 2354)
    (b) Motor vehicles must be manufactured in the United States to be 
eligible for USAID financing. Also, any vehicle to be financed by USAID 
under a long-term lease or where the sale is to be guaranteed by USAID 
must be manufactured in the United States. (22 U.S.C. 2396) For purposes 
of this section, motor vehicles are defined as self-propelled vehicles 
with passenger carriage capacity, such as highway trucks, passenger cars 
and buses, motorcycles, scooters, motorized bicycles and utility 
vehicles. Excluded from this definition are industrial vehicles for 
materials handling and earthmoving, such as lift trucks, tractors, 
graders, scrapers, off-the-highway trucks (such as off-road dump trucks) 
and other vehicles that are not designed for travel at normal road 
speeds (40 kilometers per hour and above). In addition to the above 
requirements, passenger cars, light trucks, vans, minivans and utility 
vehicles must be manufactured by either Chrysler, Ford or General Motors 
and bear their nameplates, brand names or logos, to be eligible for 
financing by USAID. The nameplate, brand name or logo requirements do 
not apply when vehicles are procured under a source waiver.
    (c) Pharmaceutical products must be manufactured in the United 
States in order to be eligible for USAID financing. USAID shall not 
finance any pharmaceutical product manufactured outside the United 
States if the manufacture of such product in the United States would 
involve the use of, or be covered by, a valid patent of the United 
States unless such manufacture is expressly authorized by the owner of 
such patent. (22 U.S.C. 2356)
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]



Sec. 228.14  Nationality of suppliers of commodities.

    (a) The rules on nationality of suppliers of commodities relate only 
to the suppliers, and not to the commodities they supply. The 
nationality of the supplier is an additional eligibility criterion to 
the rules on source, origin and componentry.
    (b) A supplier providing commodities must fit one of the following 
categories for the transaction to be eligible for USAID financing:
    (1) An individual who is a citizen or a lawfully admitted permanent 
resident of a country or area included in the authorized geographic 
source code, except as provided in paragraph (c) of this section;
    (2) A corporation or partnership organized under the laws of a 
country or area included in the authorized geographic source code and 
with a place of business in such country;
    (3) A controlled foreign corporation (within the meaning of section 
957 et seq. of the Internal Revenue Code) as attested by current 
information on file with the Internal Revenue Service of the United 
States (on IRS Form 959, 2952, 3646, or on substitute or successor 
forms) submitted by shareholders of the corporation; or
    (4) A joint venture or unincorporated association consisting 
entirely of individuals, corporations, or partnerships which are 
eligible under either paragraph (b) (1), (2) or (3) of this section.
    (c) Citizens of any country or area, or firms or organizations 
located in, organized under the laws of, or owned in any part by 
citizens or organizations of any country or area not included in 
Geographic Code 935 are ineligible for financing by USAID as suppliers 
of commodities. Limited exceptions to this rule are:
    (1) Individuals lawfully admitted for permanent residence in the 
United States are eligible, as individuals or owners, regardless of 
their citizenship; and
    (2) The USAID Procurement Executive may authorize the eligibility of 
organizations having minimal ownership by citizens or organizations of 
non-Geographic Code 935 countries.
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]

[[Page 861]]



  Subpart C--Conditions Governing the Eligibility of Commodity-Related 
                      Services for USAID Financing



Sec. 228.20  Purpose.

    Sections 228.21 through 228.25 set forth the rules governing the 
eligibility of commodity-related services, both delivery services and 
incidental services, for USAID financing. These rules may be waived in 
accordance with the provisions in subpart F of this part. Waivers 
granted pursuant to subpart F for individual shipments requiring ocean 
transportation which are not based on a determination of non-
availability shall not reduce the requirement that the applicable 
percentage of USAID cargoes be transported on U.S.-flag vessels pursuant 
to the Cargo Preference Act of 1954, Section 901(b)(1) of the Merchant 
Marine Act of 1936, as amended, 46 U.S.C. 1241(b). The rules on delivery 
services apply whether or not USAID is also financing the commodities 
being transported. In order to be identified and eligible as incidental 
services, such services must be connected with a USAID-financed 
commodity procurement.



Sec. 228.21  Ocean transportation.

    (a) The Cargo Preference Act of 1954, Section 901(b)(1) of the 
Merchant Marine Act of 1936, as amended, 46 U.S.C. 1241(b)(1), is 
applicable to ocean shipment of goods subject to this part.
    (b) In addition to cargo preference requirements, ocean shipments of 
USAID-financed goods must meet the requirements in paragraph (c) of this 
section in order for the freight cost to be eligible for USAID 
financing.
    (c) The eligibility of ocean transportation services is determined 
by the flag registry of the vessel.
    (1) When the authorized source for procurement is Geographic Code 
000 (U.S.A.), USAID will finance ocean transportation only on U.S. flag 
vessels.
    (2) When the authorized source for procurement is Geographic Code 
941 (selected Free World), USAID will finance ocean transportation on 
vessels under flag registry of any country in Code 935.
    (3) When commodities whose eligibility is restricted to Geographic 
Code 000 are purchased under agreements which authorize Geographic Code 
941 for the procurement of all other commodities, USAID will finance the 
ocean transportation in accordance with paragraph (c)(2) of this 
section.
    (4) USAID will finance costs incurred on vessels under flag registry 
of any Geographic Code 935 country if the costs are part of the total 
cost on a through bill of lading that is paid to a carrier for initial 
carriage on a vessel which is eligible in accordance with paragraph (c) 
(1), (2) or (3) of this section.



Sec. 228.22  Air transportation.

    (a) The eligibility of air transportation is determined by the flag 
registry of the aircraft. The term ``U.S. flag air carrier'' means one 
of a class of air carriers holding a certificate under Section 401 of 
the Federal Aviation Act of 1958 (49 U.S.C. 1371) authorizing operations 
between the United States or its territories and one or more foreign 
countries.
    (b) For air transport financed under USAID grants, there is a U.S. 
Government statute that requires the use of U.S. flag air carriers for 
all international air travel and transportation, unless such service is 
not available. When U.S. flag air carriers are not available, any 
Geographic Code 935 flag air carrier may be used.
    (c) Different requirements may be authorized in the implementing 
document if the transaction is financed under a USAID loan.
    (d) The Comptroller General's memorandum (B-138942), dated March 31, 
1981, entitled ``Revised Guidelines for Implementation of the Fly 
America Act'', established criteria for determining when U.S. flag air 
carriers are unavailable. See 48 CFR 47.403-1, or USAID Optional 
Standard Provision on ``Air Travel and Transportation'' for grants and 
cooperative agreements.
    (e) While the Comptroller General's memorandum does not establish 
specific criteria for determining when freight service is unavailable, 
it is USAID's policy that such service is not available when the 
following criteria are met:

[[Page 862]]

    (1) When no U.S. flag air carrier provides scheduled air freight 
service from the airport serving the shipment's point of origin and a 
non-U.S. flag carrier does;
    (2) When the U.S. flag air carrier(s) serving the shipment's point 
of origin decline to issue a through air waybill for transportation at 
the shipment's final destination airport;
    (3) When use of a U.S.-flag air carrier would result in delivery to 
final destination at least seven days later than delivery by means of a 
non-U.S. carrier;
    (4) When the total weight of the consignment exceeds the maximum 
weight per shipment which the U.S. flag air carrier will accept and 
transport as a single shipment and a non-U.S. flag air carrier will 
accept and transport the entire consignment as a single shipment;
    (5) When the dimensions (length, width, or height) of one or more of 
the items of a consignment exceed the limitations of the U.S. flag 
aircraft's cargo door opening, but do not exceed the acceptable 
dimensions for shipment on an available non-U.S. flag scheduled air 
carrier.
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]



Sec. 228.23  Eligibility of marine insurance.

    The eligibility of marine insurance is determined by the country in 
which it is ``placed''. Insurance is ``placed'' in a country if payment 
of the insurance premium is made to, and the insurance policy is issued 
by, an insurance company office located in that country. Eligible 
countries for placement are governed by the authorized geographic code. 
However, if Geographic Code 941 is authorized, the cooperating country 
is also eligible to provide such services, unless the implementing 
document specified otherwise based on the following:
    (a) If a cooperating country discriminates against marine insurance 
companies authorized to do business in any State of the United States, 
then all USAID-financed goods for that country must be insured in the 
United States against marine risk. The term ``authorized to do business 
in any State of the United States'' means that foreign-owned insurance 
companies licensed to do business in the United States (by any State) 
are treated the same as comparable U.S.-owned companies.
    (b) The prima facie test of discrimination is that a cooperating 
country takes actions which hinder private importers in USAID-financed 
transactions from making cost, insurance and freight (C.I.F.) or cost 
and insurance (C.&I.) contracts with United States commodity suppliers, 
or which hinder importers in instructing such suppliers to place marine 
insurance with companies authorized to do business in the United States.
    (c) When discrimination is found to exist and the cooperating 
country fails to correct the discriminatory practice, USAID requires 
that all commodities procured with USAID funds be insured in the United 
States against marine loss. The decision of any cooperating country to 
insure all public sector procurements locally with a government-owned 
insurance agency is not considered discrimination.



Sec. 228.24  Other delivery services.

    No source or nationality rules apply to other delivery services, 
such as export packing, loading, commodity inspection services, and 
services of a freight forwarder. Such services are eligible in 
connection with a commodity which is financed by USAID.



Sec. 228.25  Incidental services.

    Source and nationality rules do not apply to suppliers of incidental 
services specified in a purchase contract relating to equipment. 
However, citizens or firms of any country not included in USAID 
Geographic Code 935 are ineligible to supply incidental services, except 
that individuals lawfully admitted for permanent residence in the U.S. 
are eligible regardless of their citizenship.
[61 FR 53616, Oct. 15, 1996; 61 FR 54849, Oct. 22, 1996]

[[Page 863]]



Subpart D--Conditions Governing the Nationality of Suppliers of Services 
                           for USAID Financing



Sec. 228.30  Purpose.

    Sections 228.31 through 228.37 set forth the nationality rules 
governing the eligibility for USAID financing of suppliers of services 
which are not commodity-related. These rules may be waived in accordance 
with the provisions in subpart F of this part.



Sec. 228.31  Individuals and privately owned commercial firms.

    (a) In order to be eligible for USAID financing as a supplier of 
services, whether as a contractor or subcontractor at any tier, an 
individual must meet the requirements of paragraph (a)(1) of this 
section (except that individual personal services contractors are not 
subject to this requirement), and a privately owned commercial firm must 
meet the requirements in paragraph (a)(2) of this section. In the case 
of the categories described in paragraphs (a)(2) (i) and (ii) of this 
section, the certification requirements in paragraph (b) of this section 
must be met.
    (1) An individual must be a citizen of and have a principal place of 
business in a country or area included in the authorized geographic 
code, or a non-U.S. citizen lawfully admitted for permanent residence in 
the United States whose principal place of business is in the United 
States;
    (2) A privately owned commercial (i.e., for profit) corporation or 
partnership must be incorporated or legally organized under the laws of 
a country or area included in the authorized geographic code, have its 
principal place of business in a country or area included in the 
authorized geographic code, and meet the criteria set forth in either 
paragraph (a)(2)(i) or (ii) of this section:
    (i) The corporation or partnership is more than 50 percent 
beneficially owned by individuals who are citizens of a country or area 
included in the authorized geographic code or non-U.S. citizens lawfully 
admitted for permanent residence in the United States. In the case of 
corporations, ``more than 50 percent beneficially owned'' means that 
more than 50 percent of each class of stock is owned by such 
individuals; in the case of partnerships, ``more than 50 percent 
beneficially owned'' means that more than 50 percent of each category of 
partnership interest (e.g., general, limited) is owned by such 
individuals.

(With respect to stock or interest held by companies, funds or 
institutions, the ultimate beneficial ownership by individuals is 
controlling.)
    (ii) The corporation or partnership:
    (A) Has been incorporated or legally organized in the United States 
for more than 3 years prior to the issuance date of the invitation for 
bids or requests for proposals,
    (B) Has performed within the United States administrative and 
technical, professional, or construction services, similar in 
complexity, type and value to the services being contracted (under a 
contract, or contracts, for services) and derived revenue therefrom in 
each of the 3 years prior to the date described in paragraph 
(a)(2)(ii)(A) of this section,
    (C) Employs United States citizens and non-U.S. citizens lawfully 
admitted for permanent residence in the United States in more than half 
its permanent full-time positions in the United States and more than 
half of its principal management positions, and
    (D) Has the existing technical and financial capability in the 
United States to perform the contract.
    (b) A duly authorized officer of a firm or nonprofit organization 
shall certify that the participating firm or nonprofit organization 
meets either the requirements of paragraph (a)(2) (i) or (ii) of this 
section or Sec. 228.32. In the case of corporations, the certifying 
officer shall be the corporate secretary. With respect to the 
requirements of paragraph (a)(2)(i) of this section, the certifying 
officer may presume citizenship on the basis of the stockholders' record 
address, provided the certifying officer certifies, regarding any 
stockholder (including any corporate fund or institutional stockholder) 
whose holdings are material to the corporation's eligibility, that the 
certifying officer knows of no fact which might rebut that presumption.

[[Page 864]]



Sec. 228.32  Nonprofit organizations.

    (a) Nonprofit organizations, such as educational institutions, 
foundations, and associations, must meet the criteria listed in this 
section and the certification requirement in Sec. 228.31(b) to be 
eligible as suppliers of services, whether as contractors or 
subcontractors at any tier. Any such institution must:
    (1) Be organized under the laws of a country or area included in the 
authorized geographic code;
    (2) Be controlled and managed by a governing body, a majority of 
whose members are citizens of countries or areas included in the 
authorized geographic code; and
    (3) Have its principal facilities and offices in a country or area 
included in the authorized geographic code.
    (b) International agricultural research centers and such other 
international research centers as may be, from time to time, formally 
listed as such by the USAID Assistant Administrator, Global Bureau, are 
considered to be of U.S. nationality.



Sec. 228.33  Foreign government-owned organizations.

    Firms operated as commercial companies or other organizations 
(including nonprofit organizations other than public educational 
institutions) which are wholly or partially owned by foreign governments 
or agencies thereof are not eligible for financing by USAID as 
contractors or subcontractors, except if their eligibility has been 
established by a waiver approved by USAID in accordance with 
Sec. 228.54. This does not apply to foreign government ministries or 
agencies.



Sec. 228.34  Joint ventures.

    A joint venture or unincorporated association is eligible only if 
each of its members is eligible in accordance with Secs. 228.31, 228.32, 
or 228.33.



Sec. 228.35  Construction services from foreign-owned local firms.

    (a) When the estimated cost of a contract for construction services 
is $5 million or less and only local firms will be solicited, a local 
corporation or partnership which does not meet the test in 
Sec. 228.31(a)(2)(i) for eligibility based on ownership by citizens of 
the cooperating country (i.e., it is a foreign-owned local firm) will be 
eligible if it is determined by USAID to be an integral part of the 
local economy. However, such a determination is contingent on first 
ascertaining that no United States construction company with the 
required capability is currently operating in the cooperating country 
or, if there is such a company, that it is not interested in bidding for 
the proposed contract.
    (b) A foreign-owned local firm is an integral part of the local 
economy provided:
    (1) It has done business in the cooperating country on a continuing 
basis for not less than three years prior to the issuance date of 
invitations for bids or requests for proposals to be financed by USAID;
    (2) It has a demonstrated capability to undertake the proposed 
activity;
    (3) All, or substantially all, of its directors of local operations, 
senior staff and operating personnel are resident in the cooperating 
country;
    (4) Most of its operating equipment and physical plant are in the 
cooperating country.



Sec. 228.36  Ineligible suppliers.

    Citizens of any country or area not included in Geographic Code 935, 
and firms and organizations located in, organized under the laws of, or 
owned in any part by citizens or organizations of any country or area 
not included in Geographic Code 935 are ineligible for financing by 
USAID as suppliers of services, or as agents in connection with the 
supply of services. The limited exceptions to this rule are:
    (a) Individuals lawfully admitted for permanent residence in the 
United States are eligible, as individuals or owners, regardless of 
their citizenship, and
    (b) The Procurement Executive may authorize the eligibility of 
organizations having minimal ownership by citizens or organizations of 
non-Geographic Code 935 countries.

[[Page 865]]



Sec. 228.37  Nationality of employees under contracts or subcontracts for services.

    (a) The rules set forth in Secs. 228.31 through 228.36 do not apply 
to the employees of contractors or subcontractors. Such employees must, 
however, be citizens of countries included in Geographic Code 935 or, if 
they are not, have been lawfully admitted for permanent residence in the 
United States.
    (b) When the contractor on a USAID-financed construction project is 
a United States firm, at least half of the supervisors and other 
specified key personnel working at the project site must be citizens or 
permanent legal residents of the United States. Exceptions may be 
authorized by the USAID Mission Director in writing if special 
circumstances exist which make compliance impractical.
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]



Sec. 228.38  Miscellaneous service transactions.

    This section sets forth rules governing certain miscellaneous 
services.
    (a) Commissions. The nationality rules in subparts C and D of this 
part, with the exception of Sec. 228.36, do not apply to the payment of 
commissions by suppliers. A commission is defined as any payment or 
allowance by a supplier to any person for the contribution which that 
person has made to securing the sale or contract for the supplier or 
which that person makes to securing on a continuing basis similar sales 
or contracts for the supplier.
    (b) Bonds and guarantees. The nationality rules in subparts C and D 
of this part, with the exception of Sec. 228.36, do not apply to 
sureties, insurance companies or banks who issue bonds or guarantees 
under USAID-financed contracts.
    (c) Liability insurance under construction contracts. The 
nationality rules in subparts C and D of this part, with the exception 
of Sec. 228.36, do not apply to firms providing liability insurance 
under construction contracts.



Sec. 228.39  Special source rules for construction and engineering services.

    Advanced developing countries, eligible under Geographic Code 941, 
which have attained a competitive capability in international markets 
for construction services or engineering services are not eligible to 
furnish USAID-financed construction and engineering services. There is 
no waiver of this provision. (22 U.S.C. 2354)



    Subpart E--Conditions Governing Source and Nationality of Local 
              Procurement Transactions for USAID Financing



Sec. 228.40  Local procurement.

    Local procurement in the cooperating country involves the use of 
appropriated funds to finance the procurement of goods and services 
supplied by local businesses, dealers or producers, with payment 
normally being in the currency of the cooperating country. Unless 
otherwise specified in an implementing document, or a waiver is approved 
by USAID in accordance with subpart F of this part, local procurement is 
eligible for USAID financing only in the following situations:
    (a) Locally available commodities of U.S. origin, which are 
otherwise eligible for financing, if the value of the transaction is 
estimated not to exceed the local currency equivalent of $100,000 
(exclusive of transportation costs).
    (b) Commodities of Geographic Code 935 origin if the value of the 
transaction does not exceed $5,000.
    (c) Professional services contracts estimated not to exceed the 
local currency equivalent of $250,000.
    (d) Construction services contracts, including construction 
materials required under the contract, estimated not to exceed the local 
currency equivalent of $5,000,000.
    (e) Under a fixed-price construction contract of any value, the 
prime contractor may procure locally produced goods and services under 
subcontracts.
    (f) The following commodities and services which are only available 
locally:
    (1) Utilities, including fuel for heating and cooking, waste 
disposal and trash collection;
    (2) Communications--telephone, telex, facsimile, postal and courier 
services;

[[Page 866]]

    (3) Rental costs for housing and office space;
    (4) Petroleum, oils and lubricants for operating vehicles and 
equipment;
    (5) Newspapers, periodicals and books published in the cooperating 
country;
    (6) Other commodities and services (and related expenses) that, by 
their nature or as a practical matter, can only be acquired, performed, 
or incurred in the cooperating country, e.g., vehicle maintenance, hotel 
accommodations, etc.



                           Subpart F--Waivers



Sec. 228.50  General.

    USAID may expand the authorized source in order to accomplish 
project or program objectives by processing a waiver. When a waiver is 
processed to include a new country, area, or geographic code, 
procurement is not limited to the added source(s), but may be from any 
country included in the authorized geographic code. All waivers must be 
in writing.



Sec. 228.51  Commodities.

    (a) Waiver criteria. Any waiver must be based upon one of the 
criteria listed in this section. Waivers to Geographic Code 899 or Code 
935 which are justified under paragraph (a) (2) or (3) of this section 
may only be authorized on a case-by-case basis.
    (1) Commodities required for assistance are of a type that are not 
produced in and available for purchase in the United States, and for 
waivers to Code 899 or Code 935, also not in the cooperating country, or 
any country in Code 941.
    (2) It is necessary to permit procurement in a country not otherwise 
eligible in order to meet unforeseen circumstances, such as emergency 
situations.
    (3) It is necessary to promote efficiency in the use of United 
States foreign assistance resources, including to avoid impairment of 
foreign assistance objectives.
    (4) For waivers to authorize procurement from Geographic Code 941 or 
the cooperating country:
    (i) For assistance other than commodity import programs, when the 
lowest available delivered price from the United States is reasonably 
estimated to be 50 percent or more higher than the delivered price from 
a country or area included in Geographic Code 941 or the cooperating 
country.
    (ii) For assistance other than commodity import programs, when the 
estimated cost of U.S. construction materials (including transportation 
and handling charges) is at least 50 percent higher than the cost of 
locally produced materials.
    (iii) For commodity import programs or similar sector assistance, an 
acute shortage exists in the United States for a commodity generally 
available elsewhere.
    (iv) Persuasive political considerations.
    (v) Procurement in the cooperating country would best promote the 
objectives of the foreign assistance program.
    (vi) Such other circumstances as are determined to be critical to 
the success of project objectives.
    (b) Additonal requirements. A waiver to authorize procurement from 
outside the United States of agricultural commodities, motor vehicles, 
or pharmaceuticals (see Sec. 228.13, ``Special source rules requiring 
procurement from the United States,'') must also meet requirements 
established in USAID directives on commodity eligibility. (USAID's 
Automated Directives System Chapter 312.)
    (c) Any individual transaction not exceeding $5,000 (not including 
transportation) does not require a waiver. In no event, however, shall 
procurement be from a non-Code 935 source.
[61 FR 53616, Oct. 15, 1996; 62 FR 314, Jan. 3, 1997]



Sec. 228.52  Suppliers of commodities.

    Geographic code changes authorized by waiver with respect to the 
source of commodities automatically apply to the nationality of their 
suppliers. A waiver to effect a change in the geographic code only with 
respect to the nationality of the supplier of commodities, but not in 
the source of the commodities, may be sought if the situation requires 
it based on the appropriate criteria in Sec. 228.51.

[[Page 867]]



Sec. 228.53  Suppliers of services--privately owned commercial suppliers and nonprofit organizations.

    Waiver criteria. Any waiver must be based upon one of the criteria 
listed in this section. Waivers to Geographic Code 899 or Code 935 which 
are justified under paragraph (b) or (c) of this section may only be 
authorized on a case-by-case basis.
    (a) Services required for assistance are of a type that are not 
available for purchase in the United States, and for waivers to Code 899 
or Code 935, also not in the cooperating country, or any country in Code 
941.
    (b) It is necessary to permit procurement in a country not otherwise 
eligible in order to meet unforeseen circumstances, such as emergency 
situations.
    (c) It is necessary to promote efficiency in the use of United 
States foreign assistance resources, including to avoid impairment of 
foreign assistance objectives.
    (d) For waivers to authorize procurement from Geographic Code 941 or 
the cooperating country:
    (1) There is an emergency requirement for which non-USAID funds are 
not available and the requirement can be met in time only from suppliers 
in a country or area not included in the authorized geographic code.
    (2) No suppliers from countries or areas included in the authorized 
geographic code are able to provide the required services.
    (3) Persuasive political considerations.
    (4) Procurement of locally available services would best promote the 
objectives of the foreign assistance program.
    (5) Such other circumstances as are determined to be critical to the 
achievement of project objectives.



Sec. 228.54  Suppliers of services--foreign government-owned organizations.

    A waiver to make foreign government-owned organizations, described 
in Sec. 228.33, eligible for financing by USAID must be justified on the 
basis of the following criteria:
    (a) The competition for obtaining a contract will be limited to 
cooperating country firms/organizations meeting the criteria set forth 
in Secs. 228.31 or 228.32.
    (b) The competition for obtaining a contract will be open to firms 
from countries or areas included in the authorized geographic code and 
eligible under the provisions of Secs. 228.31 or 228.32, and it has been 
demonstrated that no U.S. firm is interested in competing for the 
contract.
    (c) Services are not available from any other source.
    (d) Foreign policy interests of the United States outweigh any 
competitive disadvantage at which United States firms might be placed or 
any conflict of interest that might arise by permitting a foreign 
government-owned organization to compete for the contract.



Sec. 228.55  Delivery services.

    (a) Ocean transportation. A waiver to expand the flag eligibility 
requirements to allow the use of vessels under flag registry of the 
cooperating country, or Geographic Code 899 or 935 countries may be 
authorized under the circumstances provided for in this section. Any 
waiver granted under this section for a particular shipment which is not 
based on a determination of non-availability does not reduce the pool of 
cargo from which the applicable percentage required to be shipped on 
U.S.-flag vessels under the Cargo Preference Act of 1954, Section 
901(b)(1) of the Merchant Marine Act of 1936, as amended, 46 U.S.C. 
1241(b), is determined. A waiver to expand the flag registry of any Code 
935 country may be authorized when:
    (1) It is necessary to assure adequate competition in the shipping 
market in order to obtain competitive pricing, particularly in the case 
of bulk cargoes and large cargoes carried by liners;
    (2) Eligible vessels provide liner service, only by transshipment, 
for commodities that cannot be containerized, and vessels under flag 
registry of countries to be authorized by the waiver provide liner 
service without transshipment;
    (3) Eligible vessels are not available, and cargo is ready and 
available for

[[Page 868]]

shipment, provided it is reasonably evident that delaying shipment would 
increase costs or significantly delay receipt of the cargo;
    (4) Eligible vessels are found unsuitable for loading, carriage, or 
unloading methods required, or for the available port handling 
facilities;
    (5) Eligible vessels do not provide liner service from the port of 
loading stated in the procurement's port of export delivery terms, 
provided the port is named in a manner consistent with normal trade 
practices; or
    (6) Eligible vessels decline to accept an offered consignment.
    (b) Air transportation. The preferences for use of United States 
flag air carriers or for use of United States, other Geographic Code 941 
countries, or cooperating country flag air carriers are not subject to 
waiver. Other free world air carriers may be used only as provided in 
Sec. 228.22.



Sec. 228.56  Authority to approve waivers.

    The authority to approve waivers of established policies on source, 
origin and nationality are delegated authorities within USAID, as set 
forth in the Automated Directives System Chapter 103 and any 
redelegations. USAID contractors or recipients of assistance agreements 
shall request any necessary waivers through the USAID contract or 
agreement officer.
[[Page 869]]


                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.
  Material Approved for Incorporation by Reference
  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  Redesignation Tables
  List of CFR Sections Affected

[[Page 871]]

            Material Approved for Incorporation by Reference

                      (Revised as of April 1, 1998)

  The Director of the Federal Register has approved under 5 U.S.C. 
552(a) and 1 CFR Part 51 the incorporation by reference of the following 
publications. This list contains only those incorporations by reference 
effective as of the revision date of this volume. Incorporations by 
reference found within a regulation are effective upon the effective 
date of that regulation. For more information on incorporation by 
reference, see the preliminary pages of this volume.


22 CFR (PARTS 1 TO 299)

AGENCY FOR INTERNATIONAL DEVELOPMENT
                                                                  22 CFR


American National Standards Institute

  11 West 42nd Street, New York, NY 10036 
  Telephone: (212) 642-4900
ANSI A117.1-1961, R1971 Specifications for Making              217.23(c)
  Buildings and Facilities Accessible to, and 
  Usable by, the Physically Handicapped.



[[Page 873]]



                    Table of CFR Titles and Chapters




                     (Revised as of March 31, 1998)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)

[[Page 874]]

      XXIV  Federal Energy Regulatory Commission (Part 3401)
       XXV  Department of the Interior (Part 3501)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)

[[Page 875]]

        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  [Reserved]
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)

[[Page 876]]

      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Meat and Poultry 
                Inspection, Department of Agriculture (Parts 300--
                599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
        XI  United States Enrichment Corporation (Parts 1100--
                1199)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)

[[Page 877]]

      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Thrift Depositor Protection Oversight Board (Parts 
                1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700-1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)

[[Page 878]]

            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)

[[Page 879]]

        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development, International 
                Development Cooperation Agency (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
        VI  United States Arms Control and Disarmament Agency 
                (Parts 600--699)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

[[Page 880]]

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs and Section 202 Direct Loan Program) 
                (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)

[[Page 881]]

       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200--1299)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

[[Page 882]]

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

[[Page 883]]

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100-1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400-1499)

[[Page 884]]

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       301  Travel Allowances (Parts 301-1--301-99)
       302  Relocation Allowances (Parts 302-1--302-99)

[[Page 885]]

       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)

[[Page 886]]

         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)

[[Page 887]]

        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)

[[Page 888]]

       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 889]]





           Alphabetical List of Agencies Appearing in the CFR




                     (Revised as of March 31, 1998)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

ACTION                                            45, XII
Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Consumer Service                       7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alaska Natural Gas Transportation System, Office  10, XV
     of the Federal Inspector
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII

[[Page 890]]

Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Arms Control and Disarmament Agency, United       22, VI
     States
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 891]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Enrichment Corporation, United States             10, XI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV
Farm Service Agency                               7, VII, XVIII

[[Page 892]]

Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Inspector for the Alaska Natural Gas      10, XV
     Transportation System, Office of
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Consumer Service                         7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
     of Certain Employees
[[Page 893]]

  Relocation Allowances                           41, 302
  Travel Allowances                               41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Great Lakes Pilotage                              46, III
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II

[[Page 894]]

  Mines, Bureau of                                30, VI
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, United States        22, II; 48, 7
       Agency for
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II

[[Page 895]]

Mines, Bureau of                                  30, VI
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 896]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Prisons, Bureau of                                28, V
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Depositor Protection Oversight Board       12, XV
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X

[[Page 897]]

Transportation, Office of                         7, XXXIII
Travel Allowances                                 41, 301
Treasury Department                               5, XXI; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
United States Enrichment Corporation              10, XI
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 899]]

                         Redesignation Table No. 1


                                                                        
------------------------------------------------------------------------
  Commerce Department, section (50    State Department, section (22 CFR 
           CFR Part 258)                           Part 33)             
------------------------------------------------------------------------
258.1..............................                  33.1               
258.2..............................                  33.2               
258.3..............................                  33.3               
258.4..............................                  33.4               
258.5..............................                  33.5               
258.6..............................                  33.6               
258.7..............................                  33.7               
258.8..............................                  33.8               
258.9..............................                  33.9               
258.10.............................                  33.10              
258.11.............................                  33.11              
258.12.............................                  33.12              
------------------------------------------------------------------------


[[Page 901]]

                         Redesignation Table No. 2


                      [Part 41--Nonimmigrant Visas]                     
------------------------------------------------------------------------
                Old section                          New section        
------------------------------------------------------------------------
41.1......................................  40.1; 41.21; 41.24; 41.26;  
                                             41.27; 41.101; 41.104      
41.3......................................  40.2                        
41.5......................................  41.1                        
41.6......................................  41.2                        
41.7......................................  41.3                        
41.10.....................................  41.11                       
41.12.....................................  41.12                       
41.13.....................................  41.107                      
41.14.....................................  Deleted.                    
41.20.....................................  41.22                       
41.21.....................................  41.22                       
41.22.....................................  41.22                       
41.25.....................................  41.31                       
41.30.....................................  41.71                       
41.31.....................................  41.71                       
41.32.....................................  41.23                       
41.35.....................................  41.41                       
41.36.....................................  41.3                        
41.40.....................................  41.51                       
41.41.....................................  41.51                       
41.45.....................................  41.61                       
41.50.....................................  41.24                       
41.55.....................................  41.53                       
41.60.....................................  41.52                       
41.65.....................................  41.62                       
41.66.....................................  41.81                       
41.67.....................................  41.54                       
41.68.....................................  41.61                       
41.70.....................................  41.25                       
41.90.....................................  40.6                        
41.91.....................................  40.7                        
41.95.....................................  40.8                        
41.100....................................  41.101                      
41.102....................................  41.26                       
41.104....................................  41.27                       
41.110....................................  41.101                      
41.111....................................  41.105                      
41.112....................................  41.104                      
41.113....................................  41.108                      
41.114....................................  41.102                      
41.115....................................  41.103                      
41.116....................................  41.103; 41.105              
41.117....................................  41.103                      
41.120....................................  41.111                      
41.121....................................  41.107                      
41.122....................................  41.112                      
41.123....................................  41.107                      
41.124....................................  41.113                      
41.125(f).................................  41.112                      
41.125(a)-(e), (g), (h)...................  Deleted.                    
41.126....................................  41.114                      
41.127....................................  41.42                       
41.128....................................  41.32                       
41.129....................................  41.33                       
41.130....................................  41.121                      
41.132....................................  41.42                       
41.134....................................  41.122                      
41.145....................................  40.3                        
41.150....................................  40.4                        
------------------------------------------------------------------------


                            Derivation Table                            
                      [Part 40--General Provisions]                     
------------------------------------------------------------------------
                New section                          Old section        
------------------------------------------------------------------------
40.1--Definitions.........................  42.1 (in part); 41.1 (in    
                                             part).                     
40.2--Documentation of Nationals..........  41.3; 42.3                  
40.3--Entry Into Areas Under U.S.           41.145; 42.145              
 Administration.                                                        
40.4--Furnishing Records and Information    41.150; 42.150              
 from Visa Files for court proceedings.                                 
40.5--(Unassigned)........................  None.                       
40.6--Basis for Refusal...................  41.90; 42.90                
40.7--Grounds of Ineligibility............                              
40.7(a)--Ineligibility under INA 212(a)...  41.91(a); 42.91(a)          
40.7(b)--Failure of application to comply   41.91(c); 42.91(b)          
 with INA.                                                              
40.7(c)--Former exchange visitors.........  41.91(d); 42.91(c)          
40.7(d)--Alien entitled to A, E or G NIV    42.91(d)                    
 classification.                                                        
40.8--Waiver for ineligible nonimmigrant    41.95                       
 under INA 212(d)(3)(A).                                                
------------------------------------------------------------------------


[[Page 903]]

                         Redesignation Table No. 3


                       [Part 42--Immigrant Visas]                       
------------------------------------------------------------------------
                Old section                          New section        
------------------------------------------------------------------------
42.1......................................  40.1                        
42.3......................................  40.2                        
42.5......................................  42.1                        
42.6......................................  42.2                        
42.12.....................................  42.11                       
42.20.....................................  42.12; 42.21                
42.21.....................................  42.21                       
42.22.....................................  Deleted.                    
42.23.....................................  42.22                       
42.24.....................................  42.23                       
42.25.....................................  42.24                       
42.26.....................................  42.25                       
42.27.....................................  Repealed.                   
42.28.....................................  42.27                       
42.30.....................................  42.31                       
42.31.....................................  42.31                       
42.32.....................................  42.33                       
42.33.....................................  42.31                       
42.34.....................................  42.31                       
42.35.....................................  42.34                       
42.36.....................................  42.35                       
42.37.....................................  42.26                       
42.40.....................................  42.41                       
42.41.....................................  42.42                       
42.42.....................................  42.42                       
42.43.....................................  42.43                       
42.50.....................................  42.12                       
42.51.....................................  42.12                       
42.52.....................................  42.12                       
42.53.....................................  42.12                       
42.54.....................................  42.12                       
42.55.....................................  42.12                       
42.60.....................................  42.51                       
42.61.....................................  42.52                       
42.62.....................................  42.53                       
42.63.....................................  42.54                       
42.64.....................................  42.55                       
42.65.....................................  42.83                       
42.90.....................................  40.6                        
42.91.....................................  40.7                        
42.95.....................................  42.22                       
42.100....................................  42.52                       
42.110....................................  42.61                       
42.111....................................  42.65                       
42.112....................................  42.64                       
42.113....................................  42.66                       
42.114....................................  42.62                       
42.115....................................  42.63                       
42.116....................................  42.67                       
42.117....................................  42.62; 42.67                
42.118....................................  42.68                       
42.120....................................  42.71                       
42.121....................................  42.71                       
42.122....................................  42.72                       
42.124....................................  42.73                       
42.125....................................  42.74                       
42.130....................................  42.81                       
42.134....................................  42.82                       
42.140....................................  42.61                       
42.145....................................  40.3                        
42.150....................................  40.4                        
------------------------------------------------------------------------


[[Page 905]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected, 1949-1963, 1964-1972, and 1973-1985'' published in seven 
separate volumes.

                                  1986

22 CFR
                                                                   51 FR
                                                                    Page
Chapter I
7  Authority citation revised......................................15319
7.3  (d) redesignated as (e); new (d) added........................15319
7.5  (b)(3) redesignated as (b)(4); new (b)(3) added...............15319
7.8  Redesignated as 7.9; new 7.8 added............................15319
7.9  Redesignated as 7.10; new 7.9 redesignated from 7.8...........15319
7.10  Redesignated as 7.11; new 7.10 redesignated from 7.9.........15319
7.11  Redesignated as 7.12; new 7.11 redesignated from 7.10........15319
7.12  Redesignated from 7.11.......................................15319
22.1  Table amended................................................26247
41  Authority citation revised........................6911, 18775, 21158
41.6  (e)(1) amended...............................................18775
41.40  (a)(2) amended...............................................6911
41.41  (a)(3) amended...............................................6911
41.67  (a)(1)(iii) revised; (a)(1)(iv) and (c) added; (a) 
        introductory text republished..............................21158
41.91  (a)(12)(i) amended; (a)(17) revised.........................21158
41.95  (b) revised.................................................32296
    Technical correction...........................................34086
42  Authority citation revised.....................................21158
42.91  (a)(12)(i) amended; (a)(14)(ii)(d) and (17) revised.........21158
51  Authority citation revised.....................................20475
51.21  (a), (c), and (d) revised...................................20475
    Effective date corrected.......................................22931
52.2  Removed; new 52.2 redesignated from 52.4.....................26247
52.3  Removed; new 52.3 redesignated from 52.5.....................26247
52.4  Redesignated as 52.2.........................................26247
52.5  Redesignated as 52.3.........................................26247
53.2  (h) revised..................................................26247
60  Authority citation revised.....................................39655
60.1  (a) revised..................................................39655
60.2  (a), (b), and (c) introductory text amended..................39656
61  Authority citation revised.....................................39655
61.1  (a) amended; (b) revised.....................................39656
61.2  (a) introductory text revised................................39656
61.5  (a) amended..................................................39656
62  Authority citation revised.....................................39655
62.2  Amended......................................................39656
62.3  (a) amended..................................................39656
62.4  Added........................................................39656
63  Authority citation revised.....................................39655
63.2  (b) amended..................................................39656
64  Authority citation revised.....................................39655
65  Authority citation revised.....................................39655
65.1  (a) and (b) introductory text, (1), (4), and (5) revised; 
        (b)(6) removed.............................................39656
    (a) amended....................................................39656
65.2  (a) and (c) revised..........................................39656
121.1  (b) amended.................................................47014
123.10  (e) amended................................................47014
124.10  (a)(4) amended; (b)(1) revised.............................47014
124.12  (a)(7) added...............................................47015

[[Page 906]]

124.14  (c)(8) added...............................................47015
125.4  (a) and (b)(13) amended; (b)(5) revised.....................47015
126  Authority citation revised....................................47015
126.1  (a) amended; (c) added......................................47015
126.8  Revised.....................................................47015
127.6  (a) introductory text and (b) amended.......................47016
127.7  (b) amended.................................................47016
127.8  Amended.....................................................47016
127.9  (a) amended.................................................47016
128.4  (b) amended.................................................47016
128.9  (b) amended.................................................47016
128.10  Amended....................................................47016
128.11  (a) and (b) amended........................................47016
128.13  (c) amended................................................47016
128.15  (a) and (b)(4) amended.....................................47016
144  Added..................................................22890, 22896
144.170  (c) revised...............................................22890
Chapter II
213  Authority citation revised....................................26544
213.1--213.7 (Subpart A)  Heading added............................26544
213.6  (b) amended.................................................26544
213.8--213.20 (Subpart B)  Added...................................26544
219  Added; eff. 4-7-86.......................................4576, 4579
219.103  Corrected..................................................7543
219.150  (c) corrected..............................................7543
219.170  (c) revised; eff. 4-7-86...................................4576

                                  1987

22 CFR
                                                                   52 FR
                                                                    Page
Chapter I
2a  Added..........................................................12155
7.5  (b)(3), (g), (j), and (k) amended.............................41560
7.8  (b) amended...................................................41560
7.9  Amended.......................................................41560
22  Authority citation revised.....................................29515
22.6  Revised......................................................29515
31.2  Amended......................................................43193
31.3  (j) added....................................................43193
31.4  (c) amended..................................................43193
31.6  (a) amended..................................................43193
31.8  (a) introductory text, (b), (c) and (d) amended..............43193
33  Added; interim (regulations transferred from 50 CFR Part 258) 
                                                                    7529
40  Added..........................................................42592
41  Revised........................................................42597
41.12  Table amended...............................................43894
41.25  (b) amended.................................................29375
41.91  (a)(9)(iii) and (10)(i) revised; interim....................17943
    (a)(9)(iii) and (10)(i) revised; final.........................29843
    (a)(19)(i) and (23) revised; (a)(19)(iii) and (24) removed.....43895
41.116  (b) (1) and (2) removed; (b)(3) redesignated as (b)........43895
42  Revised........................................................42613
42.12  (a) removed; (b) redesignated as (a) and table amended; (c) 
        and (d) redesignated as (b) and (c) and revised............43895
42.27  Removed.....................................................43896
42.51  Revised.....................................................43896
42.52  Revised.....................................................43896
42.91  (a)(9)(iv) and (10)(ii) revised; interim....................17943
    (a)(9)(iv) and (10)(ii) revised; final.........................29843
    (a)(19)(i) and (23) revised; (a)(19)(iii) and (24) removed.....43896
42.111  (b) revised................................................43896
42.116  (b) revised................................................43896
42.124  (c) amended................................................43896
42.125  Heading revised; (a) and (b) amended; (c) removed..........43896
42.130  (a) amended................................................43896
43  Added; interim..................................................1450
    Technical correction............................................2111
43  Addition confirmed.............................................17948
43.3  (b) amended..................................................17949
51  Authority citation revised.....................................29515
51.64  (e) added...................................................29515
171  Authority citation revised; section authority citations 
        removed....................................................32123
171.6  Revised.....................................................32123
171.10  (d) through (k) added......................................32124
171.11  (a)(7) revised.............................................32124
171.12  Revised....................................................32124
171.13  Revised....................................................32125
171.14  Added......................................................32125
171.15  Added......................................................32126
Chapter II
201  Authority citation revised....................................38405
201.11  (b)(4) amended.............................................38405
212  Authority citation revised....................................11817

[[Page 907]]

212.35  Revised; interim...........................................11817
212.41  (g) revised; interim.......................................11818
212.42  Added; interim.............................................11819
224  Added; interim................................................13071
    Removed; interim...............................................20385
    Added; final...................................................45312

                                  1988

22 CFR
                                                                   53 FR
                                                                    Page
Chapter I
7.6  (a) amended...................................................39589
7.7  (b) amended...................................................39589
7.8  (a) amended...................................................39589
20  Added..........................................................39457
40.1  (d) and (f) corrected.........................................9172
40.7  (a)(9)(i) and (28)(v), (b)(1)(iv) and (d) corrected; (b)(1) 
        (v) and (vi) correctly revised..............................9110
    (a)(14)(i), (15)(ii), (19)(ii), and (28)(i) corrected...........9172
41  Authority citation revised.....................................24904
41.2  (i) corrected.................................................9110
    (l) added......................................................24904
    (l) revised....................................................50162
    (m) added......................................................53375
41.12  Table correctly revised......................................9110
    Table amendment effective date corrected to expire 11-28-87.....9112
41.21  (d)(2) introductory text corrected; (d)(2)(ii) correctly 
        revised.....................................................9111
41.26  (c)(1)(xiv) and (2)(xi) corrected............................9111
41.27  (c)(1) (iii), (xii), and (xiii) corrected....................9111
41.31  (a) corrected................................................9172
41.32  (f) corrected................................................9111
41.53  (a)(4) corrected.............................................9172
41.91  (a)(19)(i) and (23) revision and (a)(19)(iii) and (24) 
        removal effective date corrected to expire 11-28-87.........9112
41.101  (a) corrected...............................................9112
41.102  (a)(6) corrected............................................9112
41.105  (b) corrected...............................................9112
    (a)(3) introductory text corrected..............................9172
41.112  (d)(2) introductory text and (ii) corrected.................9112
    (c)(2) corrected................................................9172
41.116  (b) (1) and (2) removal and (b)(3) redesignation as (b) 
        effective date corrected to expire 11-28-87.................9112
42.11  (b) table and (c) table corrected............................9112
    (a) table corrected.............................................9172
42.12  Effective corrected to expire 11-28-87.......................9112
42.27  Removal effective date corrected to expire 11-28-87..........9112
42.31  (a) corrected................................................9112
42.51  Revision effective date corrected to expire 11-28-87.........9112
42.52  (b)(3)(iii) corrected........................................9112
    Revision effective date corrected to expire 11-28-87............9112
42.53  (b)(2)(ii) corrected.........................................9112
42.64  (b) corrected................................................9112
42.67  (a)(2) corrected.............................................9112
42.81  (e) corrected................................................9112
42.83  (a) and (b) corrected........................................9112
42.91  (a)(19)(i) and (23) revision and (a)(19(iii) and (24) 
        removal effective date corrected to expire 11-28-87.........9112
42.111  (b) revision effective date corrected to expire 11-28-87 
                                                                    9112
42.116  (b) revision effective date corrected to expire 11-28-87 
                                                                    9112
42.124  (c) amendment effective date corrected to expire 11-28-87 
                                                                    9112
42.125  Heading revision, (a) and (b) amendment, and (c) removal 
        effective date corrected to expire 11-28-87.................9112
42.130  (a) amendment effective date corrected to expire 11-28-87 
                                                                    9112
43  Authority citation revised.....................................49980
43.4  (a) and (b) revised..........................................49980
94  Added; interim.................................................23608
120.1  Heading revised; existing text designated as (a); (a) 
        heading and (b) added; eff. 4-4-88.........................11496
120.10  (e) amended................................................11496
    Technical correction...........................................12099
120.19  (b) amended................................................11496
    Technical correction...........................................12099
120.23  Revised....................................................11496
    Technical correction...........................................12099

[[Page 908]]

120.24  Redesignated as 120.25; new 120.24 added...................11496
    Technical correction...........................................12099
120.25  Redesignated from 120.24...................................11496
    Technical correction...........................................12099
121.1  (b) amended.................................................11496
    Technical correction...........................................12099
    Heading revised; existing text designated as (a); (a) heading 
and (b) added......................................................11496
122.1  (c) added...................................................11496
    Technical correction...........................................12099
122.2  Revised.....................................................11496
    Technical correction...........................................12099
    (b)(1) clarification...........................................19774
122.3  Revised.....................................................11497
    Technical correction...........................................12099
122.4  Revised.....................................................11497
    Technical correction...........................................12099
122.6  Removed.....................................................11496
    Technical correction...........................................12099
123.1  (b) amended.................................................11497
    Technical correction...........................................12099
124.14  (d) and (e) redesignated as (e) and (f); new (d) added; 
        new (f) revised............................................11497
    Technical correction...........................................12099
125.4  (b)(4) amended; (b)(7) revised..............................11498
    Technical correction...........................................12099
126  Authority citation revised....................................11498
126.1  Heading revised; (a) amended; (d), (e), and (f) added.......11498
    Technical correction...........................................12099
126.3  Heading revised.............................................11499
    Technical correction...........................................12099
126.7  Heading and (a) revised; (d) and (e) added..................11498
    Technical correction...........................................12099
126.13  Added......................................................11499
    Technical correction...........................................12099
    (a) clarification and compliance deadline extended in part.....19774
127.1  (a)(1) revised..............................................11499
    Technical correction...........................................12099
127.6  Revised.....................................................11499
    Technical correction...........................................12099
127.7  Revised.....................................................11500
    Technical correction...........................................12099
127.9  (b) revised.................................................11500
    Technical correction...........................................12099
127.10  Added......................................................11500
    Technical correction...........................................12099
135  Added; eff. 10-1-88......................................8049, 8087
136  Added; interim................................................23188
137  Added; nomenclature change.............................19178, 19204
137.105  (w) added.................................................19178
Chapter II
201  Authority citation revised....................................31317
201.03  Added......................................................31317
201.11  (b)(4) amended.............................................31317
201.12  Revised....................................................31318
201.13  (b)(1)(ii) and (2) revised; (b)(3)(iv) amended.............31318
    (b)(2)(iii) (b) and (c) added..................................38288
204  Added.........................................................33805
204.1  (i)(1) correctly revised....................................39015
206  Added.........................................................24260
207  Added.........................................................29658
208  Revised; nomenclature change...........................19179, 19204
208.105  (g)(3), (t)(3), and (w) added.............................19179
208.215  (a) added.................................................19179

                                  1989

22 CFR
                                                                   54 FR
                                                                    Page
Chapter I
9b.1  Revised.......................................................1686
9b.2  (c) removed; introductory text, (a) (1) and (3), and (b) 
        revised.....................................................1686
9b.3  (d) removed; (a) (1) and (3) and (c) revised..................1687
9b.4  Revised.......................................................1687
9b.5  Revised.......................................................1687
9b.6  (e) added; introductory text, (a) and (c) revised.............1687
9b.7  (a), (e), (f) (1) and (3), and (g) revised....................1687
9b.8  Revised.......................................................1687
34  Added..........................................................13365
34.18  (d) revised.................................................28416
34.20  (c)(6) revised..............................................28416
41.2  (l) amended..................................................27121
44  Added...........................................................7169
51  Authority citation revised...............................8531, 30374
51.70  Revised; interim.............................................8531
    Revised; final.................................................30374
51.71  Redesignated as 51.72 and revised; new 51.71 added; interim
                                                                    8532

[[Page 909]]

    Redesignated as 51.72 and revised; new 51.71 added; final......30374
51.72  Redesignated as 51.73; new 51.72 redesignated from 51.71; 
        interim.....................................................8532
    Redesignated as 51.73; new 51.72 redesignated from 51.71 and 
revised; final.....................................................30374
51.73  Redesignated as 51.74; new 51.73 redesignated from 51.72; 
        interim.....................................................8532
    Redesignated as 51.74; new 51.73 redesignated from 51.72; 
final..............................................................30374
51.74  Redesignated from 51.73; interim.............................8532
    Redesignated from 51.73; final.................................30374
51.80  Revised; interim.............................................8532
    Revised; final.................................................30375
60  Authority citation revised.....................................31816
60.1  (b) amended..................................................31816
61  Authority citation revised.....................................31816
62  Authority citation revised.....................................31816
63  Authority citation revised.....................................31816
63.1  (b) and (d)(2) revised; (c), (d) and (1) amended.............31816
63.3  (c) amended..................................................31816
64  Authority citation revised.....................................31816
65  Authority citation revised.....................................31816
65.2  (a) amended..................................................31816
94  Regulation at 53 FR 23608 confirmed.............................1353
120.1  (b) revised.................................................42497
120.24  (e) revised................................................42497
122.2  (a) revised.................................................42497
122.4  (b) amended.................................................42497
122.5  (b) revised.................................................42497
123.23  (a) revised................................................42498
126.13  (a) introductory text and (4) revised......................42498
136  Added; final..................................................37308
137  Heading and authority citation revised.........................4954
    Technical correction............................................6363
137.305  (c) (3) and (4) amended; (c)(5) added; interim.......4950, 4954
137.320  (a) revised; interim.................................4950, 4954
137.600--137.630  Added; interim..............................4950, 4954
137  Appendix C added; interim................................4951, 4954
151.4  Revised.....................................................24555
192  Added.........................................................12597
192.52  (c)(3) corrected...........................................16195
Chapter II
208  Heading and authority citation revised; interim................4955
    Technical correction............................................6363
208.305  (c) (3) and (4) amended; (c)(5) added; interim.......4950, 4955
208.320  (a) revised; interim.................................4950, 4955
208.600--208.630 (Subpart F)  Added; interim..................4950, 4955
208  Appendix C added; interim................................4951, 4955
212.35  Regulation at 52 FR 11817 confirmed........................22437
212.41  Regulation at 52 FR 11818 confirmed........................22437
212.42  Regulation at 52 FR 11819 confirmed........................22437

                                  1990

22 CFR
                                                                   55 FR
                                                                    Page
Chapter I
33  Fee establishment; eff. to 9-30-91.............................52270
35  Added..........................................................23424
41.112  (d)(3) added...............................................36028
42.65  (c) revised.................................................29015
42.67  (c) amended.................................................29015
51.21  (b) introductory text revised; (b)(5) and (6) redesignated 
        as (b)(6) and (7); new (b)(5) added........................21538
60.1  (a) amended...................................................9723
60.2  (a), (b) and (c) introductory text amended....................9723
61.1  (a) amended...................................................9723
61.2  (a) amended...................................................9723
62.2  Amended.......................................................9723
62.3  (a) amended...................................................9723
62.4  Removed.......................................................9723
63.2  (b) amended...................................................9723
65.1  (a) amended...................................................9723
137.305  Regulation at 54 FR 4950, 4954 confirmed..................21693
137.320  Regulation at 54 FR 4950, 4954 confirmed..................21693
137.600--137.635 (Subpart F)  Revised.......................21688, 21693
137  Appendix C revised.....................................21690, 21693
138  Added; interim...........................................6737, 6749
139  Added; eff. to 1-10-94........................................49516
142  Authority citation and heading revised........................52140

[[Page 910]]

142.17  (a), (b), and (c) revised...........................52138, 52140
171.16  Added; eff. 4-12-90.........................................9318
193  Added; interim................................................52838
Chapter II
201  Revised.......................................................34232
208.305  Regulation at 54 FR 4950, 4955 confirmed..................21693
208.320  Regulation at 54 FR 4950, 4955 confirmed..................21693
208.600--208.635 (Subpart F)  Regulation at 54 FR 4950, 4955 
        confirmed; revised..................................21688, 21694
208  Appendix C revised.....................................21690, 21694
211  Revised.......................................................23639
212  Revised.......................................................43328
217  Authority citation and heading revised........................52141
217.23  (c) revised.........................................52138, 52141
227  Added; interim...........................................6737, 6749

                                  1991

22 CFR
                                                                   56 FR
                                                                    Page
Chapter I
7.2  (b) revised...................................................55457
7.9  Revised.......................................................55457
22.1  Revised......................................................55813
40  Revised........................................................30422
    Authority citation revised.....................................43552
40.1  (d) revised..................................................43552
41  Authority citation revised.......................30428, 41069, 46717
41.1  Introductory text amended....................................30428
41.2  Introductory text amended....................................30428
    (l) amended....................................................46717
41.3  Introductory text, (b) and (c) amended.......................30428
41.21  (b) introductory text amended; (d)(2) and (3) revised.......30428
41.42  (a) amended.................................................30428
41.53  Revised; interim............................................41069
41.54  Revised; interim............................................41069
41.55  Added; interim..............................................41070
41.56  Added; interim..............................................41070
41.57  Added; interim..............................................41070
41.81  (c) amended.................................................30428
41.104  (b) and (d) amended........................................30428
41.113  (k)(2) amended.............................................30428
41.121  (a) amended................................................30428
42  Authority citation revised........20347, 30428, 32323, 49676, 49680, 
                                                            51172, 55077
42.2  (d) removed; (e) through (h) redesignated as (d) through 
        (g); interim...............................................49680
42.11  Revised; interim............................................49680
42.12  (a) revised; interim........................................49681
42.21--42.23 (Subpart C)  Revised; interim.........................49676
42.22  (c) amended.................................................30428
42.31--42.33 (Subpart D)  Revised; interim.........................49676
42.32  (d)(2) added; interim.......................................51172
    (d)(7) added; interim..........................................55077
42.35  (a) and (b) amended.........................................30428
42.41  Revised; interim............................................49682
42.42  Revised; interim............................................49682
42.43  Revised; interim............................................49682
42.51--42.55 (Subpart F)  Revised; interim.........................51174
42.52  (b)(3)(iii) amended.........................................30428
42.53  (b)(1) and (2)(ii) amended..................................30428
42.54  Revised.....................................................20347
42.62  (a) amended; interim........................................49682
42.63  (a)(1) removed; (a)(2) and (3) redesignated as (a)(1) and 
        (2); new (a)(1) revised; interim...........................49682
42.65  (c) amended; interim........................................49682
42.67  (a)(2) revised; interim.....................................49682
42.72  (e) added...................................................32323
42.73  (a)(3) revised; interim.....................................49682
42.74  (a) and (b) revised; interim................................49682
42.83  (a) revised; interim........................................49682
43  Authority citation revised..............................20349, 30428
    Heading and authority citation revised.........................46101
43.1--43.5 (Subpart A)  Heading added..............................46101
43.5  Amended......................................................30428
43.6  Added........................................................20349
43.11--43.17 (Subpart B)  Added....................................46101
43.17  Corrected...................................................49821
44  Authority citation revised.....................................30428
44.6  Amended......................................................30428
45  Added..........................................................32506
47  Added..........................................................32325
51.61  (b) revised.................................................11062
    Revised........................................................55816
89  Added; interim; effective to 12-31-91..........................24341
    Heading corrected..............................................26853

[[Page 911]]

89.1  Revised......................................................66974
120.21  (c) revised................................................55458
121.1  (b) amended.................................................23020
123.16  (b) revised................................................55458
126  Authority citation revised.............................55458, 55631
126.1  (a), (c) and (d) revised; (e) removed; (f) redesignated as 
        (e)........................................................55631
126.4  (c) revised.................................................55458
171.32  (h), (i), (j)(1), (2) and (5) amended.......................6969
Chapter II
225  Added..................................................28012, 28020
225.101  (b)(5) corrected..........................................29756
225.103  (f) corrected.............................................29756

                                  1992

22 CFR
                                                                   57 FR
                                                                    Page
Chapter I
41  Authority citation revised................................343, 31447
41.11  (b)(1) revised..............................................31448
41.12  Revised.....................................................31448
41.53  Revised.....................................................31449
41.54  Revised.....................................................31449
41.55  Revised.....................................................31450
41.56  Revised.....................................................31450
41.57  Revised.....................................................31450
41.58  Added; interim................................................343
43  Authority citation revised.....................................28980
43.12  (d) added...................................................28980
43.13  Revised.....................................................28981
43.14  Revised.....................................................28981
43.15  Revised.....................................................28982
43.17  Revised.....................................................28982
51  Authority citation revised......................................3282
51.4  (g) added; eff. 4-25-92.......................................3282
51.21  (c) introductory text, (1) and (d)(1) revised; (d)(4) added
                                                                   59807
89.1  Corrected.....................................................1385
121  Revised.......................................................15230
121.1  Amended; interim............................................32148
    Amended.................................................41078, 48316
172  Added.........................................................32896
193  Authority citation revised.....................................3283
193.1  (c) revised; interim.........................................3283
193.2  (d) added; interim...........................................3283
193.3  (e) revised; interim.........................................3283
193.4  (b) revised; interim.........................................3283
Chapter II
211  Revised.......................................................19766
215  Revised.......................................................38277

                                  1993

22 CFR
                                                                   58 FR
                                                                    Page
Chapter I
41  Authority citation revised..............................40586, 68527
41.2  (l) amended; interim.........................................40586
    (i) amended; interim...........................................43439
41.51  (f) added; interim..........................................68527
41.54  (e) and (f) redesignated as (f) and (g); new (e) added; 
        interim....................................................68527
41.59  Added; interim..............................................68527
42.2  Regulation at 56 FR 49680 confirmed..........................48447
42.11  Regulation at 56 FR 49680 confirmed.........................48447
42.12  Regulation at 56 FR 49681 confirmed.........................48447
42.21--42.23 (Subpart C)  Regulation at 56 FR 49676 confirmed......48447
42.31--42.33 (Subpart D)  Regulation at 56 FR 49676 confirmed......48447
42.32  Regulations at 56 FR 51172 and 55077 confirmed..............48446
42.41  Regulation at 56 FR 49682 confirmed.........................48447
42.42  Regulation at 56 FR 49682 confirmed.........................48447
42.43  Regulation at 56 FR 49682 confirmed.........................48447
42.51--42.55 (Subpart F)  Regulation at 56 FR 51174 confirmed......48446
42.62  Regulation at 56 FR 49682 confirmed.........................48447
42.63  Regulation at 56 FR 49682 confirmed.........................48447
42.65  Regulation at 56 FR 49682 confirmed.........................48447
42.67  Regulation at 56 FR 49682 confirmed.........................48447
42.73  Regulation at 56 FR 49682 confirmed.........................48447
42.74  Regulation at 56 FR 49682 confirmed.........................48447
42.83  Regulation at 56 FR 49682 confirmed.........................48447
89  Authority citation revised.....................................65120
89.1  Revised......................................................65120
120  Revised.......................................................39283

[[Page 912]]

121  Revised.......................................................39287
    Authority citation revised..............................60113, 60115
121.1  Amended..............................................47638, 60115
121.12  Revised....................................................60113
121.14  Removed....................................................60115
121.15  Revised....................................................60115
122  Revised.......................................................39298
123  Revised.......................................................39299
124  Revised.......................................................39305
125  Revised.......................................................39310
126  Revised.......................................................39312
126.1  (a) revised.................................................35865
127  Revised.......................................................39316
128  Revised.......................................................39320
130  Revised.......................................................39323
Chapter II
201.11  (b)(4) revised.............................................48797
221  Added.........................................................14148

                                  1994

22 CFR
                                                                   59 FR
                                                                    Page
Chapter I
22  Authority citation revised.....................................48999
22.1  Table amended; interim................................25324, 48999
40  Authority citation revised.....................................51369
40.1  (l) through (r) redesignated as (m) through (s); new (l) 
        added; eff. 5-2-94.........................................15300
40.101--40.104 (Subpart K)  Heading revised; interim...............51369
40.104  Added; interim.............................................51369
40.105  Added......................................................55045
41.2  (j)  revised..................................................1473
41.107  (e) added; interim.........................................25325
42  Authority citation revised.....................................15301
42.33  Added; eff. 5-2-94..........................................15301
42.51  (b) revised; eff. 5-2-94....................................15302
42.54  (a)(2) revised; eff. 5-2-94.................................15302
42.61  (a) revised.................................................39955
51  Authority citation revised.....................................48999
51.64  (f) added; interim..........................................48999
51.67  Added; interim..............................................49000
60--65 (Subchapter G)  Removed.....................................33909
120.15  Revised....................................................25811
120.16  Revised....................................................25811
121.1  Amended; (c) removed; (d) redesignated as (c)...............46548
    Amended.................................................46549, 47800
123.16  (a) revised................................................29951
    (b)(1) revised.................................................45622
124.10  Revised....................................................29951
124.15  Added......................................................45622
126  Authority citation revised....................................42158
126.1  (a) and (d) revised; (f) added..............................15625
    (a) and (c) revised............................................42158
126.5  Revised.....................................................29951
145  Added.........................................................18731
171.32  (j)(1) amended..............................................2521
Chapter II
220  Removed.......................................................28769
222  Removed.......................................................28769

                                  1995

22 CFR
                                                                   60 FR
                                                                    Page
Chapter I
21  Added..........................................................29988
22  Authority citation revised.....................................16047
22.1  Table amended................................................16047
41  Authority citation revised.....................................10497
41.2  (l) revised; interim.........................................15874
41.3  (e) revised..................................................30188
41.12  Revised.....................................................10497
41.58  Added.......................................................42036
42  Authority citation revised..............................10499, 35839
42.11  Revised.....................................................10499
42.32  (d)(1)(ii) revised..........................................35839
43  Authority citation revised......................................7445
43.21--43.27 (Subpart C)  Added; interim............................7445
92  Authority citation revised.....................................51721
92.1  (d) added....................................................51721
92.2  Revised......................................................51721
92.3  Amended......................................................51723
92.4  Heading, (a), (b) and (c) revised............................51721
92.5  Revised......................................................51721
92.6  Introductory text and (b) revised............................51721
92.7  Heading and (b) revised......................................51721
92.8  Amended......................................................51723
92.9  (a) and (b) amended..........................................51723
92.10  Amended.....................................................51723
92.11  (a) and (b) amended.........................................51723
92.12  Amended.....................................................51723
92.15  Amended.....................................................51723
92.17  Amended.....................................................51723
92.23  Amended.....................................................51723
92.24  Amended.....................................................51723
92.27  (a) and (b) amended.........................................51723
92.29  Amended.....................................................51723

[[Page 913]]

92.31  (a) amended.................................................51722
    Amended........................................................51723
92.32  (b) amended.................................................51723
92.33  Amended.....................................................51723
92.35  Amended.....................................................51723
92.51  Revised.....................................................51722
92.52  Revised.....................................................51722
92.55  Revised.....................................................51722
92.56  Introductory text amended...................................51723
92.57  Amended.....................................................51723
92.59  Amended.....................................................51723
92.60  Amended.....................................................51723
92.61  Amended.....................................................51723
92.62  Amended.....................................................51723
92.63  Amended.....................................................51723
92.64  (b) amended.................................................51723
92.66  (a) and (d) revised.........................................51722
94.2  Revised......................................................25843
94.6  Introductory text and (l) revised; (k) removed; (a) through 
        (j) redesignated as (b) through (k); new (a) added; 
        interim....................................................66074
135.36  (d), (g), (h) and (i) revised.......................19639, 19642
137.100  Revised............................................33040, 33045
137.105  Amended............................................33041, 33045
137.110  (c) revised........................................33041, 33045
137.200  Revised............................................33041, 33045
137.215  Revised............................................33041, 33045
137.220  Revised............................................33041, 33045
137.225  Revised............................................33041, 33045
137  Appendixes A and B revised.............................33042, 33045
Chapter II
208.100  Revised............................................33040, 33045
208.105  Amended............................................33041, 33045
208.110  (c) revised........................................33041, 33045
208.200  Revised............................................33041, 33045
208.215  Revised............................................33041, 33045
208.220  Revised............................................33041, 33045
208.225  Revised............................................33041, 33045
208  Appendixes A and B revised.............................33042, 33045
211.4  (e)(3) added................................................36991
213  Authority citation revised....................................40456
213.21--213.27 (Subpart C)  Added..................................40456
226  Added; interim.................................................3744
    Technical correction............................................7712

                                  1996

22 CFR
                                                                   61 FR
                                                                    Page
Chapter I
2a  Removed........................................................10447
4  Revised.........................................................32328
9b.8  Revised; eff. 4-2-96..........................................3800
31  Removed.........................................................2915
33  Revised........................................................49966
40  Authority citation revised.....................................59184
40  Technical correction...........................................11305
40.1  (h)(2), (3) and (m) revised; (h)(4) added.....................1835
40.9  Removed.......................................................1835
    Added..........................................................59184
40.51  (a) and (c) revised..........................................1835
40.52  Revised......................................................1835
40.62  Revised......................................................1833
40.63  (b) revised..................................................1835
      Heading revised..............................................59184
40.91--40.93 (Subpart J)  Redesignated as 40.101--40.103 (Subpart 
        K).........................................................59184
40.93  Revised......................................................1833
40.101  (a)(5) revised..............................................1835
40.101--40.104 (Subpart K)  Regulation at 59 FR 51369 confirmed.....9325
40.104  Regulation at 59 FR 51369 confirmed.........................9325
40.101--40.105 (Subpart K)  Redesignated from 40.91--40.93 
        (Subpart J)................................................59184
    Redesignated as 40.201--40.205 (Subpart L).....................59184
40.111 (Subpart L)  Redesignated as 40.301 (Subpart M).............59184
40.201--40.205 (Subpart L)  Redesignated from 40.101--40.105 
        (Subpart K)................................................59184
40.301 (Subpart M)  Redesignated from 40.111 (Subpart L)...........59184
41  Authority citation revised......................................1838
41.1  Introductory text and (a) revised.............................1835
41.2  (l)(2) amended; interim...............................35629, 39319
41.3  (d) revised...................................................1835
41.11  (a) and (b)(1) revised.......................................1835
41.12  Table amended................................................1836
41.42  (b)(1) revised...............................................1836
41.53  (a) revised..................................................1833
41.54  (a) revised..................................................1833
41.55  (a) introductory text, (1) and (2) revised...................1833
41.56  (a) introductory text, (1) and (2) revised...................1833

[[Page 914]]

41.57  (a)(2) and (c) revised; (a)(3) removed.......................1833
41.81--41.83 (Subpart I)  Heading revised...........................1838
41.82  Added........................................................1838
41.83  Added........................................................1838
41.101  (c) added...................................................1522
    (c) removed....................................................53058
    (a) revised....................................................56439
41.104  (e) added...................................................1522
    (e) removed....................................................53058
41.105  (a)(3)(iii) revised; (a)(3)(iv) added.......................1522
    (a)(3)(iii) amended; (a)(3)(iv) removed........................53058
41.113  (k)(2)(ii) amended; (k)(3) added............................1523
    (k)(2) introductory text revised................................1836
    (k)(2)(ii) amended; (k)(3) removed.............................53058
42.31  (c) removed..................................................1836
42.33  (b)(1) revised; (i) added....................................1524
    Regulation at 61 FR 1524 eff. date corrected 1-22-96............6111
42.52  (a) revised..................................................1836
42.54  (b) removed..................................................1836
42.55  (a) revised..................................................1836
42.63  (a)(2) revised...............................................1836
42.72  (e) introductory text revised................................1836
42.74  (b) revised..................................................1836
43  Removed.........................................................1837
44  Removed.........................................................1837
45.5  (e) revised...................................................1837
47  Removed.........................................................1837
50  Authority citation revised.....................................43311
50.1  (g) added....................................................43311
50.2  Amended......................................................43311
50.3  (b) revised..................................................43312
50.5  Introductory text revised....................................43312
50.7  Revised......................................................43312
50.8  Revised......................................................43312
50.9  Revised......................................................43312
50.20  (a) removed; (b) redesignated as (a)........................29652
    (a)(1) and (2) amended.........................................29653
50.30  (d) added...................................................29652
50.40  Removed; new 50.40 redesignated from 50.41; (a) through (d) 
        redesignated as (c), (d), (b) and (e); new (a) added; new 
        (b) revised; new (d) amended...............................29652
50.41  Redesignated as 50.40.......................................29652
50.42  Removed.....................................................29653
50.50  (a) amended.................................................29653
50.51  Removed; new 50.51 redesignated from 50.52..................29653
50.52  Redesignated as 50.51.......................................29653
51.1  (h) added....................................................43312
51.21  (b)(6) revised..............................................43312
51.27  (b), (c) and (d) revised.....................................6505
51.33  Revised.....................................................29940
81  Removed........................................................29941
82  Removed........................................................29941
83  Removed........................................................29941
84  Removed........................................................29941
85  Removed........................................................29941
86  Removed........................................................29941
87  Removed........................................................29941
88  Removed........................................................29941
89.1  Revised......................................................29945
92.58  Corrected...................................................14375
    Corrected......................................................14375
92.59  Corrected...................................................14375
94.6  Regulation at 60 FR 66074 confirmed...........................7070
111  Removed........................................................6506
112  Removed........................................................6506
120.10  (a)(1) revised.............................................48831
121.1  Amended..............................................56895, 68633
123.22  (d) revised................................................48831
123.27  Added.......................................................6112
126.1  Undesignated text designated as (a) in part; new (a) 
        amended.....................................................6113
    (a) amended...............................19841, 33313, 41499, 41738
    (a) revised....................................................36625
128.1  Revised.....................................................48831
128.2  Revised.....................................................48831
128.3  Revised.....................................................48831
128.4  Revised.....................................................48832
128.5  (b) and (c) revised.........................................48832
128.6  Revised.....................................................48832
128.7  Revised.....................................................48832
128.8  Revised.....................................................48833
128.9  Revised.....................................................48833
128.10  Revised....................................................48833
128.11  Revised....................................................48833
128.12  Revised....................................................48833
128.13  (a), (c), (e) and (f) revised..............................48833
128.14  Revised....................................................48834
128.15  Revised....................................................48834
128.16  Revised....................................................48834
131.1  Revised.....................................................39585
133  Removed........................................................6506
171.32  (j)(2) amended.............................................68149
181  Authority citation revised.....................................7071

[[Page 915]]

181.1  (a) amended..................................................7071
181.8  Added.........................................................707
Chapter II
210  Removed.......................................................65946
212  Revised.......................................................43002
228  Added.........................................................53616
228.03  (b) corrected..............................................54849
228.25  Corrected..................................................54849
228.30--228.39 (Subpart D)  Heading corrected......................55361

                                  1997

22 CFR
                                                                   62 FR
                                                                    Page
Chapter I
22  Authority citation revised.....................................42666
22.1  Amended......................................................42666
40  Authority citation revised.....................................67564
40.11  (b) revised; (c) added; interim.............................67567
40.22  (b) removed; (c) through (f) redesignated as (b) through 
        (e); interim...............................................67567
40.41  Revised; interim............................................67564
40.52  Amended; interim............................................67567
40.61  Revised; interim............................................67567
40.62  Revised; interim............................................67567
40.66  Revised; interim............................................67567
40.67  Added; interim..............................................67568
40.91  Revised; interim............................................67568
40.92  Revised; interim............................................67568
40.93  Revised; interim............................................67568
40.104  Revised; interim...........................................67568
40.105  Revised; interim...........................................67568
41  Authority citation revised.....................................48154
41.2  (l) revised; interim.........................................51031
41.51  Revised.....................................................48154
41.107  Regulation at 59 FR 25325 confirmed........................24334
41.112  (b) revised................................................24332
41.113  (c), (h) and (k) removed; (d) through (g), (i) and (j) 
        redesignated as (c) through (h); (a), (b) and new (c) 
        through new (f) revised....................................24333
42.11  Introductory text revised; table amended......................614
42.72  (a) and (e)(4) amended; (e)(1) revised......................27694
    (e)(4) corrected...............................................32196
51  Authority citation revised.....................................62695
51.70  (a)(7) amended; (a)(8) added................................62695
51.80  Revised.....................................................62695
120  Authority citation revised....................................67275
120.7  (a) revised.................................................67275
120.9  Revised.....................................................67275
122.3  (a) revised.................................................27497
123  Authority citation revised....................................67275
123.15  Revised....................................................67275
124.4  Revised.....................................................67276
124.11  Revised....................................................67276
126  Authority citation revised....................................67276
126.1  (a) amended.................................................37133
126.10  (b) revised................................................67276
127  Authority citation revised....................................67276
127.10  (a) revised................................................67276
129  Added.........................................................67276
135.26  (a), (b) introductory text and (1) revised..........45939, 45941
145.26  (a), (b) and (c) revised............................45939, 45941
171  Authority citation revised....................................48758
171.12  Revised; interim...........................................48758
Chapter II
201  Nomenclature change...........................................38027
201.11  (b), (e) and (j) revised...................................38027
201.12  (d) revised; (e) added.....................................38027
201.13  (a), (b) and (c) revised...................................38027
201.14  Amended....................................................38027
226.26  (a), (b) and (c) revised............................45939, 45941
228.11  (b) corrected................................................314
228.13  (b) corrected................................................314
228.14  (c)(2) corrected.............................................314
228.22  (d) corrected................................................314
228.37  (b) corrected................................................314
228.51  (c) corrected................................................314

                                  1998

      (Regulations published January 1, 1998, through April 1, 1998

22 CFR
                                                                   63 FR
                                                                    Page
Chapter I
22  Authority citation revised......................................5100
22.1  Revised.......................................................5100
22.8  Removed.......................................................5103
40.68  Added; interim................................................671
41.59  (c) revised.................................................10305

[[Page 916]]

41.101  (a)(1)(ii) and (2) amended; (b) redesignated as (e); 
        (a)(1)(iii), new (b), (c) and (d) added; interim.............671
41.121  (a) amended; interim.........................................671
42.32  (d)(1)(ii) revised...........................................4394
42.74  (a) and (b) revised..........................................4393
51  Authority citation revised......................................5103
51.4  (b) revised...................................................7285
51.61  Revised......................................................5103
51.62  Removed; new 51.62 redesignated from 51.63...................5103
51.63  Redesignated as 51.62; new 51.63 redesignated from 51.64; 
        (a) and (f) amended.........................................5103
51.64  Redesignated as 51.63; new 51.64 redesignated from 51.65.....5103
51.65  Redesignated as 51.64; new 51.65 redesignated from 51.66.....5103
51.66  Redesignated as 51.65; new 51.66 redesignated from 51.67; 
        (a) and (c) revised.........................................5103
51.67  Redesignated as 51.66........................................5103
    Correctly redesignated as 51.66.................................6479
53  Heading and authority citation revised..........................5103
72.14  Revised......................................................6480
72.52  Revised......................................................6480
72.53  (a) revised..................................................6480
92.43  Amended......................................................6480
92.44  Removed......................................................6480
92.48  Removed......................................................6480