Unknown. Final rule amendments
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/register/2002/03/19/02-6617A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
--- schema: federal-register doc_type: fedreg source_file: FR-2002-03-19.xml --- 67 53 Tuesday, March 19, 2002 Contents Administration Administration on Aging See Aging Administration Aging Aging Administration NOTICES Grants and cooperative agreements; availability, etc.: National Family Caregiver Support Program, 12569 02-6619 Senior Medicare Patrol Projects, 12569-12570 02-6618 Agricultural Agricultural Marketing Service PROPOSED RULES Milk marketing orders: Pacific Northwest et al., 12488 02-6657 Agriculture Agriculture Department See Agricultural Marketing Service See Commodity Credit Corporation See Farm Service Agency See Food and Nutrition Service See Forest Service See National Agricultural Library See Natural Resources Conservation Service See Rural Business-Cooperative Service See Rural Housing Service See Rural Utilities Service Alcohol Alcohol, Tobacco and Firearms Bureau NOTICES Agency information collection activities:
Proposed collection; comment request, 02-6584 12642-12644 02-6585 02-6586 02-6587 Antitrust Antitrust Division NOTICES National cooperative research notifications: COVA Technologies, Inc., 12574 02-6500 Army Army Department See Engineers Corps NOTICES Military traffic management: Personal Property Program; participation; qualifying procedures, 12540-12544 02-6582 Patent licenses; non-exclusive, exclusive, or partially exclusive: Critical care platform for litters, 12544 02-6581 Privacy Act:
Systems of records, 12544-12546 02-6545 Census Census Bureau NOTICES Agency information collection activities: Proposed collection; comment request, 12517-12518 02-6517 Meetings: Professional Associations Census Advisory Committee, 12518 02-6580 Centers Centers for Disease Control and Prevention NOTICES Meetings: Disease, Disability, and Injury Prevention and Control Special Emphasis Panel, 12570 02-6656 Centers Centers for Medicare & Medicaid Services RULES Medicaid: Medicaid upper payment limit for non-State government-owned or operated hospitals; modification Effective date delay, 12479 02-6713 Commerce Commerce Department See Census Bureau See International Trade Administration See National Oceanic and Atmospheric Administration NOTICES Agency information collection activities:
Submission for OMB review; comment request, 12514-12517 02-6518 02-6519 02-6611 CITA Committee for the Implementation of Textile Agreements NOTICES Cotton, wool, and man-made textiles: China, 12525-12528 02-6595 Oman, 12528 02-6596 Taiwan, 12528-12530 02-6597 Turkey, 12530-12531 02-6598 Commodity Commodity Credit Corporation RULES Loan and purchase programs: Noninsured Crop Disaster Assistance Program, 12446-12458 02-6212 Defense Defense Department See Army Department See Engineers Corps See Navy Department RULES Civilian health and medical program of uniformed services (CHAMPUS):
TRICARE program— Pharmacy Benefits Program, partial implementation; and National Defense Authorization Act medical benefits for 2001 FY; implementation; correction, 12472-12473 02-6542 NOTICES Agency information collection activities: Proposed collection; comment request, 12531-12532 02-6543 02-6544 Privacy Act: Systems of records— National Imagery and Mapping Agency, 12532-12540 02-6546 Drug Drug Enforcement Administration NOTICES *Applications, hearings, determinations, etc.:* Ace Wholesale & Trading Co., 12574-12576 02-6568 Aqui Enterprises, 12576-12579 02-6572 Linder, David W., 12579-12580 02-6571 Seaside Pharmaceutical Co., 12580-12583 02-6569 Southern Illinois Wholesale, Inc., 12583-12584 02-6570 Education Education Department NOTICES Grants and cooperative agreements; availability, etc.:
Campus-Based programs, 12547-12548 02-6548 Postsecondary education— Leveraging Educational Assistance Partnership and Special Leveraging Educational Assistance Partnership Programs, 12548-12549 02-6549 Energy Energy Department See Federal Energy Regulatory Commission NOTICES Grants and cooperative agreements; availability, etc.: Integrated Assessment of Climate Change Research Program, 12549-12551 02-6547 Engineers Engineers Corps NOTICES Environmental statements; notice of intent:
Columbia and Lower Willamette Rivers Federal Navigation Channel improvements, OR and WA, 12546-12547 02-6583 EPA Environmental Protection Agency RULES Air quality planning purposes; designation of areas: Nevada; correction, 12474-12478 02-6613 Superfund program: National oil and hazardous substances contingency plan— National priorities list update, 12478-12479 02-6485 NOTICES Superfund; response and remedial actions, proposed settlements, etc.: Burgess Inc. Site, IL, 12567 02-6614 Toxic and hazardous substances control:
New chemicals— Receipt and status information, 12562-12567 02-6616 Executive Executive Office of the President See Presidential Documents See Trade Representative, Office of the United States Farm Farm Credit Administration NOTICES Meetings; Sunshine Act, 12567-12568 02-6732 Farm Farm Service Agency RULES Program regulations: Farm loan programs account servicing policies; servicing shared appreciation agreements; correction, 12458-12459 02-6210 FAA Federal Aviation Administration RULES Air carrier certification and operations:
Flightcrew compartment access and door designs, 12819-12824 02-6366 Airworthiness directives: Boeing, 12464-12468 02-6328 02-6329 PROPOSED RULES Air carrier certification and operations: Light sport aircraft; meeting, 12825-12827 02-6643 NOTICES Reports and guidance documents; availability, etc.: Critical propeller parts; parts manufacturer approval; policy statement, 12641 02-6127 FCC Federal Communications Commission RULES Common carrier services: Satellite communications— Satellite license procedures, 12485 02-6524 Radio stations; table of assignments:
Various States, 12486 02-6375 Television broadcasting: Television channels 52-59; 698-746 MHz spectrum band; reallocation and service rules, 12483-12484 02-6621 PROPOSED RULES Common carrier services: Satellite communications— Satellite license procedures, 12498-12500 02-6525 Radio stations; table of assignments: California, 12501 02-6374 Michigan, 12501 02-6373 NOTICES Common carrier services: Video distribution service providers; contribution obligations— BT North America, Inc.; expedited petition for clarification, 12568 02-6526 Federal Emergency Federal Emergency Management Agency RULES Flood elevation determinations:
Various States, 12479-12483 02-6574 PROPOSED RULES Flood elevation determinations: Various States, 12495-12498 02-6573 NOTICES Disaster and emergency areas: Oklahoma, 12568-12569 02-6575 Oregon, 12569 02-6576 Federal Energy Federal Energy Regulatory Commission RULES Practice and procedure: Gas transmission facilities in off-shore southern Louisiana area; certificates of public convenience and necessity; policy statement removed, 12468-12470 02-6555 NOTICES Electric rate and corporate regulation filings:
Bastrop Energy Partners, L.P., et al., 12555-12558 02-6556 Vermont Yankee Nuclear Power Corp. et al., 12558-12560 02-6508 Environmental statements; notice of intent: Iroquois Gas Transmission System, L.P., 12560-12562 02-6557 *Applications, hearings, determinations, etc.:* Bayswater Peaking Facility, LLC, 12551-12552 02-6436 Duke Energy Washington, LLC, 12552 02-6561 Florida Gas Transmission Co., 12552-12553 02-6559 ISO New England, Inc., 12553 02-6563 MEP Clarksdale Power, LLC, 12553-12554 02-6560 PacifiCorp-Bear River Projects, ID, 12554 02-6564 Thoroughbred Generation Co., LLC, 12554 02-6562 Transcontinental Gas Pipe Line Corp., 12554-12555 02-6558 Federal Highway Federal Highway Administration NOTICES Environmental statements; notice of intent:
Macon County, MO; rescission, 12641-12642 02-6501 Federal Motor Federal Motor Carrier Safety Administration RULES Motor carrier safety standards: Mexican motor carriers— Application form to operate beyond U.S. municipalities and commercial zones on U.S.-Mexico border, 12701-12755 02-5891 Application form to operate in U.S. municipalities and commercial zones on U.S.-Mexico border, 12651-12700 02-5890 Safety monitoring system and compliance initiative for carriers operating in U.S., 12757-12774 02-5892 Safety fitness procedures— Safety auditors, investigators, and inspectors; certification, 12775-12779 02-5894 PROPOSED RULES Motor carrier safety standards:
Parts and accessories necessary for safe operation— Certification of compliance with Federal motor vehicle safety standards, 12781-12787 02-5893 Fish Fish and Wildlife Service PROPOSED RULES Migratory bird hunting: Seasons, limits, and shooting hours; establishment, etc., 12501-12510 02-6527 Food Food and Drug Administration RULES Animal drugs, feeds, and related products: Oxytetracycline injection, 12470-12471 02-6492 NOTICES Agency information collection activities: Proposed collection; comment request, 12570-12571 02-6493 Meetings:
Food Advisory Committee, 12571-12572 02-6620 Reports and guidance documents; availability, etc.: Catfish, common or usual names; Agriculture et al. Appropriations Act of 2002; section 775 implementation; correction, 12649 C2-2753 Food Food and Nutrition Service NOTICES Agency information collection activities: Proposed collection; comment request, 12511-12513 02-6589 02-6590 Foreign Foreign Assets Control Office NOTICES Terrorism-related blocked persons; additional designations, 12644-12646 02-3291 Forest Forest Service NOTICES Meetings:
Resource Advisory Committees— Lake County, 12513 02-6579 Tehama County, 12513 02-6588 Government Government Ethics Office RULES Sector mutual funds, de minimis securities, and securities of affected entities in litigation; financial interests; exemptions, 12443-12446 02-6617 Health Health and Human Services Department See Aging Administration See Centers for Disease Control and Prevention See Centers for Medicare & Medicaid Services See Food and Drug Administration Housing Housing and Urban Development Department RULES Manufactured home construction and safety standards:
Smoke alarms, 12811-12818 02-6026 NOTICES Agency information collection activities: Proposed collection; comment request, 12572 02-6553 Immigration Immigration and Naturalization Service NOTICES Agency information collection activities: Proposed collection; comment request, 02-6503 12584-12586 02-6504 02-6505 02-6506 Interior Interior Department See Fish and Wildlife Service IRS Internal Revenue Service RULES Excise taxes: Excess benefit transactions Correction, 12471-12472 02-6475 Income taxes:
Deductions and credits; disallowance for failure to file timely return Correction, 12471 02-6476 PROPOSED RULES Income taxes: Consolidated return regulations— Non-applicability of section 357(c) in consolidated group; hearing cancelled, 12494 02-6607 Credit for increasing research activities; correction, 12494-12495 02-6608 NOTICES Agency information collection activities: Proposed collection; comment request, 12646-12647 02-6482 Meetings: Citizen Advocacy Panels— New York Metro District, 12647 02-6298 International International Trade Administration NOTICES Antidumping:
Gray Portland cement and clinker from— Mexico, 12518-12519 02-6600 Oil country tubular goods, other than drill pipe, from— Korea, 12520-12521 02-6599 Preserved mushrooms from— Chile, 12521-12522 02-6602 Stainless steel sheet and strip in coils from— France, 12522-12524 02-6601 Countervailing duties: Carbon and alloy steel wire rod from— Various countries, 12524 02-6603 Export trade certificates of review, 12524-12525 02-6507 Justice Justice Department See Antitrust Division See Drug Enforcement Administration See Immigration and Naturalization Service See Prisons Bureau NOTICES Pollution control; consent judgments:
AlliedSignal Inc. et al., 12572-12573 02-6279 02-6280 Macdonald, Angus, et al., 12573-12574 02-6499 NASA National Aeronautics and Space Administration NOTICES Meetings: Advisory Council Aerospace Technology Advisory Committee, 12586-12587 02-6496 02-6497 Space Science Advisory Committee, 12587 02-6498 National National Agricultural Library NOTICES Agency information collection activities: Proposed collection; comment request, 12513-12514 02-6591 National Credit National Credit Union Administration RULES Credit unions:
Prompt corrective action and insurance requirements— Financial and Statistical Reports; filing requirements, 12459-12464 02-6512 National Highway National Highway Traffic Safety Administration PROPOSED RULES Motor vehicle safety standards: Commercial motor vehicles; importation, 12805-12809 02-5896 North American Free Trade Agreement (NAFTA); implementation— Commercial vehicles; retroactive certification by motor vehicle manufacturers, 12789-12797 02-5897 Mexican motor carriers; access to U.S.; recordkeeping and record retention, 12799-12804 02-5895 NOAA National Oceanic and Atmospheric Administration RULES Fishery conservation and management:
Alaska; fisheries of Exclusive Economic Zone— Pacific cod, 12486-12487 02-6566 NOTICES Ocean and coastal resource management: Marine sanctuaries— Hawaiian Islands Humpback Whale National Marine Sanctuary, HI; meetings, 12525 02-6265 NRCS Natural Resources Conservation Service NOTICES Field office technical guides; changes: Washington, 12514 02-6605 Navy Navy Department NOTICES Patent licenses; non-exclusive, exclusive, or partially exclusive: Large Scale Biology, Inc., 12547 02-6528 Nuclear Nuclear Regulatory Commission PROPOSED RULES Production and utilization facilities; domestic licensing:
ASME Boiler and Pressure Vessel Code and Operation and Maintenance of Nuclear Power Plants Code; incorporation by reference, 12488-12493 02-6495 NOTICES Environmental statements; availability, etc.: Entergy Operations, Inc., 12587-12595 02-6535 Meetings: New reactor licensing activities; workshop, 12595-12596 02-6494 Meetings; Sunshine Act, 12596-12597 02-6655 Operating licenses, amendments; no significant hazards considerations; biweekly notices, 12597-12615 02-6230 Postal Postal Rate Commission NOTICES Meetings:
Consignia; regulatory developments in United Kingdom, 12615 02-6534 Presidential Presidential Documents PROCLAMATIONS *Special observances:* National Poison Prevention Week (Proc. 7532), 12441-12442 02-6718 Prisons Prisons Bureau NOTICES Inmate control, custody, care, etc.: Incarceration for Federal inmates; annual determination of average cost, 12586 02-6592 Public Public Health Service See Centers for Disease Control and Prevention See Food and Drug Administration Rural Rural Business-Cooperative Service RULES Program regulations:
Farm loan programs account servicing policies; servicing shared appreciation agreements; correction, 12458-12459 02-6210 Rural Rural Housing Service RULES Program regulations: Farm loan programs account servicing policies; servicing shared appreciation agreements; correction, 12458-12459 02-6210 RUS Rural Utilities Service RULES Program regulations: Farm loan programs account servicing policies; servicing shared appreciation agreements; correction, 12458-12459 02-6210 SEC Securities and Exchange Commission NOTICES Investment Company Act of 1940:
Exemption applications— Financial Investors Trust et al., 12628-12630 02-6550 Putnam American Government Income Fund et al., 12623-12628 02-6509 Self-regulatory organizations; proposed rule changes: Government Securities Clearing Corp., 12630-12631 02-6511 National Association of Securities Dealers, Inc., 12631-12633 02-6510 *Applications, hearings, determinations, etc.:* Public utility holding company filings, 12615-12623 02-6551 State State Department NOTICES Foreign terrorists; individuals and organizations; designation:
Al-Nasser, Adbelkarim Hussein Mohammed, et al., 12633-12635 02-6577 Textile Textile Agreements Implementation Committee See Committee for the Implementation of Textile Agreements Trade Representative Trade Representative, Office of the United States NOTICES Harmonized Tariff Schedule; technical corrections, 12635-12637 02-6735 World Trade Organization: Doha, Qater; Ministerial Conference; multilateral trade negotiations and agenda; comment request, 12637-12641 02-6606 Transportation Transportation Department See Federal Aviation Administration See Federal Highway Administration See Federal Motor Carrier Safety Administration See National Highway Traffic Safety Administration Treasury Treasury Department See Alcohol, Tobacco and Firearms Bureau See Foreign Assets Control Office See Internal Revenue Service Veterans Veterans Affairs Department RULES Vocational rehabilitation and education:
Veterans education— Flight-training programs; information collection, 12473-12474 02-6540 NOTICES Agency information collection activities: Proposed collection; comment request, 12647-12648 02-6537 Submission for OMB review; comment request, 02-6538 12648 02-6539 Separate Parts In This Issue Part II Transportation Department, Federal Motor Carrier Safety Administration, 12651-12700 02-5890 Part III Transportation Department, Federal Motor Carrier Safety Administration, 12701-12755 02-5891 Part IV Transportation Department, Federal Motor Carrier Safety Administration, 12757-12774 02-5892 Part V Transportation Department, Federal Motor Carrier Safety Administration, 12775-12779 02-5894 Part VI Transportation Department, Federal Motor Carrier Safety Administration, 12781-12787 02-5893 Part VII Transportation Department, National Highway Traffic Safety Administration, 12789-12797 02-5897 Part VIII Transportation Department, National Highway Traffic Safety Administration, 12799-12804 02-5895 Part IX Transportation Department, National Highway Traffic Safety Administration, 12805-12809 02-5896 Part X Housing and Urban Development Department, 12811-12818 02-6026 Part XI Transportation Department, Federal Aviation Administration, 12819-12824 02-6366 Part XII Transportation Department, Federal Aviation Administration, 12825-12827 02-6643 Reader Aids Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.
To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.gpo.gov and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions. 67 53 Tuesday, March 19, 2002 Rules and Regulations OFFICE OF GOVERNMENT ETHICS 5 CFR Part 2640 RIN 3209-AA09 Exemption Amendments Under 18 U.S.C. 208(b)(2) AGENCY: Office of Government Ethics (OGE). ACTION: Final rule amendments.
SUMMARY: The Office of Government Ethics is issuing a final rule to amend the regulation that describes financial interests that are exempt from the prohibition in 18 U.S.C. 208(a). These final rule amendments revise the existing exemption regulation by: creating a new exemption for sector mutual funds; raising the de minimis exemption for matters affecting interests in securities from $5,000 to $15,000; and creating an exemption that permits an employee to act in certain particular matters that affect an entity in which the employee owns securities, where the entity is not a party to the matter.
EFFECTIVE DATE: April 18, 2002. FOR FURTHER INFORMATION CONTACT: Richard Thomas, Associate General Counsel, Office of Government Ethics; Telephone: 202-208-8000; TDD: 202-208-8025; FAX: 202-208-8037. SUPPLEMENTARY INFORMATION: I. Rulemaking History Section 208(a) generally prohibits employees of the executive branch from participating in an official capacity in particular matters in which they or certain others specified in the statute have a financial interest. Section 208(b)(2) of title 18 permits OGE to promulgate regulations describing financial interests that are exempted as being too remote or inconsequential to warrant disqualification pursuant to section 208(a).
The Office of Government Ethics' executive branchwide section 208 regulations, including such exemptions, are codified at 5 CFR part 2640. On September 6, 2000, OGE published a set of proposed amendments to the regulation, proposing to revise some existing exemptions as well as to add some new exemptions. See 65 FR 53942-53946. The proposed rule provided a 90-day comment period. The Office of Government Ethics received 13 comment letters on the proposed rule. After carefully considering all comments and making appropriate modifications, OGE is publishing this final rule after obtaining the concurrence of the Department of Justice pursuant to section 201(c) of Executive Order 12674, as modified by E.O. 12731.
Also, as provided in section 402 of the Ethics in Government Act of 1978, as amended, 5 U.S.C. appendix, section 402, OGE has consulted with both the Department of Justice (as additionally required under 18 U.S.C. 208(d)(2)) and the Office of Personnel Management on this final rule. II. Analysis of Comments and Revisions Of the thirteen comments submitted, ten were from executive branch Departments or agencies, one was from a professional association, and two were from individuals.
Overall, the comments to the proposed rule were positive. Many commenters had specific suggestions pertaining to one or more components of the proposed rule. Two commenters expressed the view that the OGE Form 450 and SF 278 reporting requirements should be revised to no longer require a filer to disclose on his form assets which are exempt under 5 CFR part 2640. These reporting issues are separate and distinct from the issue of whether an exemption is warranted under section 208(b)(2).
Although OGE will not address specific reporting issues in this rulemaking, comments relating to financial disclosure requirements have been considered as part of OGE's separate proposed revision of the Ethics in Government Act, as amended. The analysis below focuses on changes from the proposed amendments, either as recommended by the commenters or which OGE believes are otherwise appropriate. Many of the amendments proposed are being adopted as final without change in this rulemaking document.
Subpart B—Exemptions Pursuant to 18 U.S.C. 208(b)(2) Section 2640.201 Exemptions for Interests in Mutual Funds, Unit Investment Trusts, and Employee Benefit Plans Sector Mutual Funds Several commenters recommended that OGE revise the proposed exemption for sector mutual funds to provide a total, rather than a $50,000 de minimis exemption. Two commenters suggested raising the de minimis amount. The Office of Government Ethics believes that the $50,000 de minimis exemption amount proposed is appropriate and is adopting it as final in § 2640.201(b) as revised.
Establishing a total exemption for all employees would be difficult in light of the legal standard that the exempted interest be “remote and inconsequential.” The $50,000 exemption being adopted is reasonably considered remote and inconsequential for all employees and is consistent with the de minimis exemption for particular matters of general applicability in existing paragraph
(b)of § 2640.202, which is being redesignated as paragraph
(c)thereof (see below). This final rule contains one technical correction of the wording in the proposed rule. In the proposed rule, OGE inadvertently proposed limiting the existing exemption for sector mutual funds at § 2640.201(b) by restricting the exemption to disqualifying financial interests arising from the ownership by the employee, his spouse or minor children of an interest in the fund. Consistent with the original exemption for sector mutual funds, OGE intended that the new exemption would include interests held by an employee and all the others whose financial interests are imputed to him under 18 U.S.C. 208. This is reflected in the final rule by tracking the reference in the existing paragraph
(b)of § 2640.201 prior to this amendment. The wording and structure of the exemption also have been modified somewhat in this final rule to clarify its meaning. Section 2640.202 Exemptions for Interests in Securities De Minimis Exemption for Matters Involving Parties Several commenters were pleased with the proposed increase (now being adopted as final) in the de minimis exemption amount for securities in particular matters involving specific parties from $5,000 to $15,000, under § 2640.202(a) as proposed for revision. However, one commenter stated that the increase in the de minimis amount would lead to greater intrusion into the privacy of filers, by reducing the number of reported assets, but probing further into the values of assets not previously required to be reported on the OGE Form 450. As an initial matter, raising the de minimis amount will not affect the OGE Form 450 filer's reporting requirements. In addition, as mentioned earlier, the reporting requirements for both the OGE Form 450 and the SF 278 are separate matters from the focus of this rulemaking, which addresses whether certain financial interests are too remote or inconsequential under section 208(b)(2) to warrant disqualification under 18 U.S.C. 208(a). De Minimis Exemption for Matters Affecting Nonparties The Office of Government Ethics received varied comments in response to proposed new § 2640.203(m). Under that section, as proposed, an employee would have been able to participate in certain matters in litigation involving specific parties in which the employee had a disqualifying financial interest of up to $25,000 in securities issued by a nonparty affected by the litigation. Two commenters were generally satisfied with the proposed rule. Of those who expressed some dissatisfaction with the proposed rule, two recommended broadening the rule to encompass any particular matter affecting nonparties, rather than limiting the rule to matters in litigation. Two commenters recommended including an example or definitions. The Office of Government Ethics' original proposed part 2640 regulations, published for comment in the **Federal Register** on September 11, 1995, included a proposed exemption for disqualifying interests arising from ownership of securities issued by a nonparty. See 60 FR 27228. In the comments to that proposed rule, some agencies expressed a concern that this specific proposed exemption would be too complex. As a result, OGE decided not to include the exemption in its final version of 5 CFR part 2640. Over the years, however, some agencies have continued to express a need for such an exemption. The strongest advocate stressed the need for an exemption for matters in litigation affecting nonparties, so OGE included this exemption in the proposed regulation published on September 6, 2000. As noted, two commenters to the proposed amendments supported broadening this exemption, essentially recommending that OGE establish in this final rule the exemption as proposed in September 1995. After additional consideration, OGE has decided to adopt in revised § 2640.202(b) of this final rule a broader exemption than that proposed, so as to include any particular matter involving specific parties, not just matters in litigation. Because of its broadened scope, this new exemption is being moved to the primary section for interests in securities at § 2640.202. The broader rule will be more useful to a greater range of agencies and will simplify the exemption by eliminating the need for determining whether a matter constitutes “litigation.” Moreover, to address the commenters’ recommendations and to clarify the rule, OGE is adding an example to the exemption. One commenter requested that OGE define “nonparty” and offer guidance on how to identify nonparties and determine if they are affected by a matter. Because each situation may vary to such a degree that the question is best addressed on a case-by-case basis, OGE will not define “nonparty” in this rulemaking. The Office of Government Ethics believes that the example now provided will promote a clearer understanding of the application of this exemption. In the proposed rule, OGE proposed to revise Example 2 after § 2640.203(f), relating to interests in mutual insurance companies, to suggest that the proposed § 2640.203(m) for matters in litigation could apply in the situation described in the example. Upon reflection, that suggestion was incorrect because the interests of a policy holder with a mutual insurance company would not fall within the definition of “security” at § 2640.102(r). Accordingly, this final rule does not contain any amendment to that example. The rule as proposed for particular matters affecting nonparties will be revised as described above and redesignated as new paragraph
(b)of § 2640.202. Existing paragraphs
(b)through
(e)of current § 2640.202 are being redesignated as paragraphs
(c)through (f), respectively, of that section. In addition, several existing examples in part 2640 are being revised (as proposed) to reflect the new de minimis exemption amounts. III. Matters of Regulatory Procedure Executive Order 12866 In promulgating this final regulation, 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 Review and Planning. This regulation has also been reviewed by the Office of Management and Budget under that Executive order. Executive Order 12988 As Director of the Office of Government Ethics, I have reviewed this final amendatory regulation in light of section 3 of Executive Order 12988, Civil Justice Reform, and certify that it meets the applicable standards provided therein. Regulatory Flexibility Act As Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this proposed amendatory rule will not have a significant economic impact on a substantial number of small entities because it primarily affects Federal executive branch employees. Paperwork Reduction Act The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply because this final regulation does not contain information collection requirements that require the approval of the Office of Management and Budget. Unfunded Mandates Reform Act For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 25, subchapter II), this final rule will not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation) in any one year. Congressional Review Act The Office of Government Ethics has determined that this proposed rulemaking involves a nonmajor rule under the Congressional Review Act (5 U.S.C. chapter 8) and has submitted a report thereon to the U.S. Senate, House of Representatives and General Accounting Office in accordance with that law. List of Subjects in 5 CFR Part 2640 Conflicts of interests, Government employees. Approved: November 16, 2001. Amy L. Comstock, Director, Office of Government Ethics. Accordingly, for the reasons set forth in the preamble, the Office of Government Ethics is amending 5 CFR part 2640 as follows: PART 2640—INTERPRETATION, EXEMPTIONS AND WAIVER GUIDANCE CONCERNING 18 U.S.C. 208 (ACTS AFFECTING A PERSONAL FINANCIAL INTEREST) 1. The authority citation for part 2640 continues to read as follows: Authority: 5 U.S.C. App. (Ethics in Government Act of 1978); 18 U.S.C. 208; E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306. Subpart A—General Provisions 2. Section 2640.102 is amended by revising paragraph
(r)to read as follows: § 2640.102 Definitions.
(r)*Security* means common stock, preferred stock, corporate bond, municipal security, long-term Federal Government security, and limited partnership interest. The term also includes “mutual fund” for purposes of § 2640.202(e) and
(f)and §2640.203(a). 3. Section 2640.103 is amended by revising Example 1 following paragraph (a)(2) to read as follows: § 2640.103 Prohibition.
(a)* * *
(2)* * * Example 1 to paragraph (a)(2): An agency's Office of Enforcement is investigating the allegedly fraudulent marketing practices of a major corporation. One of the agency's personnel specialists is asked to provide information to the Office of Enforcement about the agency's personnel ceiling so that the Office can determine whether new employees can be hired to work on the investigation. The employee personnel specialist owns $20,000 worth of stock in the corporation that is the target of the investigation. She does not have a disqualifying financial interest in the matter (the investigation and possible subsequent enforcement proceedings) because her involvement is on a peripheral personnel issue and her participation cannot be considered “substantial” as defined in the statute. Subpart B—Exemptions Pursuant to 18 U.S.C. 208(b)(2) 4. Section 2640.201 is amended by: a. Revising the heading of Example 1 and revising Example 2 following paragraph (a); b. Revising paragraph (b); and c. Revising the heading of Example 1 and adding new Examples 2 and 3 following new paragraph (b)(2)(ii). The revisions and additions read as follows: § 2640.201 Exemptions for interests in mutual funds, unit investment trusts, and employee benefit plans.
(a)* * * Example 1 to paragraph (a): * * * Example 2 to paragraph (a): A nonsupervisory employee of the Department of Energy owns shares valued at $75,000 in a mutual fund that expressly concentrates its holdings in the stock of utility companies. The employee may not rely on the exemption in paragraph
(a)of this section to act in matters affecting a utility company whose stock is a part of the mutual fund's portfolio because the fund is not a diversified fund as defined in § 2640.102(a). The employee may, however, seek an individual waiver under 18 U.S.C. 208(b)(1) permitting him to act.
(b)*Sector mutual funds.*
(1)An employee may participate in any particular matter affecting one or more holdings of a sector mutual fund where the affected holding is not invested in the sector in which the fund concentrates, and where the disqualifying financial interest in the matter arises because of ownership of an interest in the fund. (2)(i) An employee may participate in a particular matter affecting one or more holdings of a sector mutual fund where the disqualifying financial interest in the matter arises because of ownership of an interest in the fund and the aggregate market value of interests in any sector fund or funds does not exceed $50,000.
(ii)For purposes of calculating the $50,000 de minimis amount in paragraph (b)(2)(i) of this section, an employee must aggregate the market value of all sector mutual funds in which he has a disqualifying financial interest and that concentrate in the same sector and have one or more holdings that may be affected by the particular matter. Example 1 to paragraph (b): * * * Example 2 to paragraph (b): A health scientist administrator employed in the Public Health Service at the Department of Health and Human Services is assigned to serve on a Departmentwide task force that will recommend changes in how Medicare reimbursements will be made to health care providers. The employee owns $35,000 worth of shares in the XYZ Health Sciences Fund, a sector mutual fund invested primarily in health-related companies such as pharmaceuticals, developers of medical instruments and devices, managed care health organizations, and acute care hospitals. The health scientist administrator may participate in the recommendations. Example 3 to paragraph (b): The spouse of the employee in the previous Example owns $40,000 worth of shares in ABC Specialized Portfolios: Healthcare, a sector mutual fund that also concentrates its investments in health-related companies. The two funds focus on the same sector and both contain holdings that may be affected by the particular matter. Because the aggregated value of the two funds exceeds $50,000, the employee may not rely on the exemption. 5. Section 2640.202 is amended by: a. Revising paragraph (a)(2); b. Revising the heading of Example 1 and revising Examples 2 and 3 following paragraph (a)(2); c. Redesignating paragraphs
(b)through
(e)as paragraphs
(c)through (f), respectively; d. Adding a new paragraph (b); e. Adding new Example 1 following new paragraph (b)(2); and f. Revising the heading of Example 1 and removing Example 2 following redesignated paragraph (c)(2). The revisions and additions read as follows: § 2640.202 Exemptions for interests in securities.
(a)* * *
(2)The aggregate market value of the holdings of the employee, his spouse, and his minor children in the securities of all entities does not exceed $15,000. Example 1 to paragraph (a): * * * Example 2 to paragraph (a): In the preceding example, the employee and his spouse each own $8,000 worth of stock in XYZ Corporation, resulting in ownership of $16,000 worth of stock by the employee and his spouse. The exemption in paragraph
(a)of this section would not permit the employee to participate in the evaluation of bids because the aggregate market value of the holdings of the employee, spouse and minor children in XYZ Corporation exceeds $15,000. The employee could, however, seek an individual waiver under 18 U.S.C. 208(b)(1) in order to participate in the evaluation of bids. Example 3 to paragraph (a): An employee is assigned to monitor XYZ Corporation's performance of a contract to provide computer maintenance services at the employee's agency. At the time the employee is first assigned these duties, he owns publicly traded stock in XYZ Corporation valued at less than $15,000. During the time the contract is being performed, however, the value of the employee's stock increases to $17,500. When the employee knows that the value of his stock exceeds $15,000, he must disqualify himself from any further participation in matters affecting XYZ Corporation or seek an individual waiver under 18 U.S.C. 208(b)(1). Alternatively, the employee may divest the portion of his XYZ stock that exceeds $15,000. This can be accomplished through a standing order with his broker to sell when the value of the stock exceeds $15,000.
(b)*De minimis exemption for matters affecting nonparties.* An employee may participate in any particular matter involving specific parties in which the disqualifying financial interest arises from the ownership by the employee, his spouse, or minor children of securities issued by one or more entities that are not parties to the matter but that are affected by the matter, if:
(1)The securities are publicly traded, or are long-term Federal Government or municipal securities; and
(2)The aggregate market value of the holdings of the employee, his spouse and minor children in the securities of all affected entities (including securities exempted under paragraph
(a)of this section) does not exceed $25,000. Example 1 to paragraph (b): A Food and Drug Administration advisory committee is asked to review a new drug application from Alpha Drug Co. for a new lung cancer drug. A member of the advisory committee owns $20,000 worth of stock in Mega Drug Co., which manufactures the only similar lung cancer drug on the market. If approved, the Alpha Drug Co.'s drug would directly compete with the drug sold by the Mega Drug Co., resulting in decreased sales of its lung cancer drug. The committee member may participate in the review of the new drug.
(c)* * * Example 1 to paragraph (c): * * * 6. Section 2640.204 is amended by revising Example 1 which follows the section to read as follows: § 2640.204 Prohibited financial interests. Example 1 to § 2640.204: The Office of the Comptroller of the Currency (OCC), in a regulation that supplements part 2635 of this chapter, prohibits certain employees from owning stock in commercial banks. If an OCC employee purchases stock valued at $2,000 in contravention of the regulation, the exemption at § 2640.202(a) for interests arising from the ownership of no more than $15,000 worth of publicly traded stock will not apply to the employee's participation in matters affecting the bank. [FR Doc. 02-6617 Filed 3-18-02; 8:45 am]
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