[Federal Register Volume 63, Number 243 (Friday, December 18, 1998)]
[Rules and Regulations]
[Pages 69992-69994]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33555]


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OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2635

RIN 3209-AA04


Standards of Ethical Conduct for Employees of the Executive 
Branch

AGENCY: Office of Government Ethics (OGE).

ACTION: Final rule; amendments.

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SUMMARY: The Office of Government Ethics is amending portions of the 
regulation governing standards of ethical conduct for executive branch 
employees which concern gifts from outside sources, to conform with 
interpretive advice and to improve clarity.

EFFECTIVE DATE: January 19, 1999.

FOR FURTHER INFORMATION CONTACT: G. Sid Smith, Senior Associate General 
Counsel, Office of Government Ethics; telephone: 202-208-8000; TDD: 
202-208-8025; FAX: 202-208-8037.

SUPPLEMENTARY INFORMATION: On August 4, 1998, the Office of Government 
Ethics (OGE) published proposed minor amendments to the standards of 
ethical conduct for executive branch employees (5 CFR part 2635), to 
codify interpretive advice and clarify intended meaning in

[[Page 69993]]

subpart B (Gifts From Outside Sources). See 63 FR 41476-41477. No 
comments to that proposed rulemaking were received. Therefore, OGE is 
herewith publishing the proposed amendments as a final rule, with no 
changes, effective January 19, 1999. A summary of the amendments 
follows.
    Sections 2635.202 and 2635.203 of the standards of ethical conduct 
regulation, as promulgated for codification at 5 CFR part 2635 in 1992, 
implemented the general ban on soliciting or accepting gifts from 
certain prohibited sources and gifts given because of an employee's 
official position. The amendment to Sec. 2635.203(e) in this current 
rulemaking clarifies the meaning of gifts given because of the 
employee's official position, by revising the text and adding a new 
Example 2. The existing definition had been applied too broadly by 
some, in OGE's view, to encompass gifts based on mere happenstance that 
the recipient is a Government employee. The amended text and new 
example clarify that gifts given because of official position only 
describe those gifts which are motivated by the status, authority, or 
duties associated with the employee's Federal position.
    Section 2635.204 of the standards of ethical conduct regulation, as 
promulgated in 1992, established certain exceptions to the gift ban in 
Sec. 2635.202. The introductory text of existing Sec. 2635.204 notes 
that a gift accepted under one of the exceptions will not be deemed to 
violate the fourteen general principles of ethical behavior contained 
in Sec. 2635.101(b) and Executive Order 12674. Some ethics officials 
and employees had misunderstood the primary intent of this statement, 
which is that appearance concerns will not preclude use of the gift 
exceptions or require an employee to reject a gift which otherwise 
falls within one of the exceptions. The amendment to this text in the 
current rulemaking highlights the appearance standard as the primary 
principle among the fourteen that will not be deemed to override 
acceptance of a gift under one of the exceptions. This will further the 
original intent of promoting consistency in application of the gift 
rules, while recognizing that appearance concerns are already built 
into the various exceptions. A cautionary statement remains in the 
introductory text of Sec. 2635.204 as promulgated in 1992, to alert 
employees that it may sometimes be prudent not to accept gifts even 
though permitted, and Sec. 2635.202(c)(3) continues to limit the over-
frequent acceptance of gifts that might appear to use public office for 
private gain.
    Section 2635.204(a) of the standards of ethical conduct regulation, 
as promulgated in 1992, provided an exception to the general gift ban, 
for gifts aggregating $20 or less ``per occasion.'' Some ethics 
officials and employees had been uncertain whether this meant that all 
gifts at a particular event must be aggregated, or only gifts from each 
source at that event. The amendment to the text of this section and new 
Example 5 clarify that the exception was intended to allow acceptance 
of gifts aggregating $20 or less ``per source per occasion.'' This 
would not, however, permit an employee to accept a gift worth more than 
$20 toward which several sources at an event or occasion have each 
contributed $20 or less, because a gift is not divisible for acceptance 
purposes unless it consists of distinct and separate items, as 
suggested in the remaining original text in Sec. 2635.204(a).

Executive Order 12866

    In promulgating these final rule amendments, the Office of 
Government Ethics has adhered to the regulatory philosophy and the 
applicable principles of regulation set forth in section 1 of Executive 
Order 12866, Regulatory Planning and Review. These amendments have also 
been reviewed by the Office of Management and Budget under that 
Executive order.

Regulatory Flexibility Act

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

Paperwork Reduction Act

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

List of Subjects in 5 CFR Part 2635

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

    Approved: October 26, 1998.
Stephen D. Potts,
Director, Office of Government Ethics.

    For the reasons set forth in the preamble, the Office of Government 
Ethics is amending part 2635 of subchapter B of chapter XVI of title 5 
of the Code of Federal Regulations, as follows:

PART 2635--[AMENDED]

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

    Authority: 5 U.S.C. 7301, 7351, 7353; 5 U.S.C. App. (Ethics in 
Government Act of 1978); E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., 
p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., 
p. 306.

    2. Section 2635.203 is amended by revising paragraph (e) and adding 
a new Example 2 after that paragraph to read as follows:


Sec. 2635.203  Definitions.

* * * * *
    (e) A gift is solicited or accepted because of the employee's 
official position if it is from a person other than an employee and 
would not have been solicited, offered, or given had the employee not 
held the status, authority or duties associated with his Federal 
position.
* * * * *
    Example 2: Employees at a regional office of the Department of 
Justice (DOJ) work in Government-leased space at a private office 
building, along with various private business tenants. A major fire 
in the building during normal office hours causes a traumatic 
experience for all occupants of the building in making their escape, 
and it is the subject of widespread news coverage. A corporate hotel 
chain, which does not meet the definition of a prohibited source for 
DOJ, seizes the moment and announces that it will give a free 
night's lodging to all building occupants and their families, as a 
public goodwill gesture. Employees of DOJ may accept, as this gift 
is not being given because of their Government positions. The 
donor's motivation for offering this gift is unrelated to the DOJ 
employees' status, authority or duties associated with their Federal 
position, but instead is based on their mere presence in the 
building as occupants at the time of the fire.
* * * * *
    3. The undesignated introductory text of Sec. 2635.204 is amended 
by revising the first sentence to read as follows:


Sec. 2635.204  Exceptions.

    The prohibitions set forth in Sec. 2635.202(a) do not apply to a 
gift accepted under the circumstances described in paragraphs (a) 
through (l) of this section, and an employee's acceptance of a gift in 
accordance with one of those paragraphs will be deemed not to violate 
the principles set forth in Sec. 2635.101(b), including appearances. * 
* *
* * * * *
    4. Paragraph (a) of Sec. 2635.204 is amended by adding the words 
``per source'' before the words ``per occasion''

[[Page 69994]]

in the first sentence, and by adding a new Example 5 after paragraph 
(a) to read as follows:


Sec. 2635.204  Exceptions.

* * * * *
    (a) * * *
* * * * *
    Example 5: During off-duty time, an employee of the Department of 
Defense (DOD) attends a trade show involving companies that are DOD 
contractors. He is offered a $15 computer program disk at X Company's 
booth, a $12 appointments calendar at Y Company's booth, and a deli 
lunch worth $8 from Z Company. The employee may accept all three of 
these items because they do not exceed $20 per source, even though they 
total more than $20 at this single occasion.
* * * * *
[FR Doc. 98-33555 Filed 12-17-98; 8:45 am]
BILLING CODE 6345-01-P