[Federal Register Volume 76, Number 85 (Tuesday, May 3, 2011)]
[Proposed Rules]
[Pages 24816-24820]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-10629]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 76, No. 85 / Tuesday, May 3, 2011 / Proposed 
Rules

[[Page 24816]]



OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2640

RIN 3209-AA09


Government Employees Serving in Official Capacity in Nonprofit 
Organizations; Sector Unit Investment Trusts

AGENCY: Office of Government Ethics (OGE).

ACTION: Proposed rule.

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SUMMARY: The Office of Government Ethics is issuing a proposed rule 
amendment that would permit Government employees to participate in 
particular matters affecting the financial interests of nonprofit 
organizations in which they serve in an official capacity, 
notwithstanding the employees' imputed financial interest. This 
document also proposes an amendment that would clarify that the 
existing exemptions for interests in the holdings of sector mutual 
funds also apply to interests in the holdings of sector unit investment 
trusts.

DATES: Comments are invited and must be received on or before July 5, 
2011.

ADDRESSES: You may submit comments, in writing, to OGE on this proposed 
rule, identified by RIN 3209-AA09, by any of the following methods:
    E-Mail: usoge@oge.gov. Include the reference ``Proposed Rule 
Exemption and Amendment Under 18 U.S.C. 208(b)(2)'' in the subject line 
of the message.
    Fax: 202-482-9237.
    Mail/Hand Delivery/Courier: Office of Government Ethics, Suite 500, 
1201 New York Avenue, NW., Washington, DC 20005-3917, Attention: 
Richard M. Thomas, Associate General Counsel.
    Instructions: All submissions must include OGE's agency name and 
the Regulation Identifier Number (RIN), 3209-AA09, for this rulemaking.

FOR FURTHER INFORMATION CONTACT: Richard M. Thomas, Associate General 
Counsel, Office of Government Ethics; telephone: 202-482-9300; TTY: 
800-877-8339; Fax: 202-482-9237.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 208(a) of title 18 of the United States Code prohibits 
Government employees from participating in an official capacity in 
particular Government matters in which, to their knowledge, they or 
certain other persons specified in the statute have a financial 
interest, if the particular matter would have a direct and predictable 
effect on that interest. Section 208(b)(2) of title 18 permits the 
Office of Government Ethics to promulgate regulations describing 
financial interests that are too remote or inconsequential to warrant 
disqualification pursuant to section 208(a).
    On August 28, 1995, the Office of Government Ethics published its 
first interim rule, with request for comments, promulgating certain 
miscellaneous exemptions under 18 U.S.C. 208(b)(2). 60 FR 44705 (August 
28, 1995). On December 18, 1996, the Office of Government Ethics 
published a comprehensive final rule, ``Interpretation, Exemptions and 
Waiver Guidance Concerning 18 U.S.C. 208 (Acts Affecting a Personal 
Financial Interest),'' codified at 5 CFR part 2640, which promulgated 
several additional exemptions and also adopted as final, with some 
modifications, the exemptions promulgated in the earlier interim rule. 
61 FR 66829 (December 18, 1996) (final rule); 60 FR 47207 (September 
11, 1995) (proposed rule). OGE subsequently has added and amended 
exemptions by interim rule, with request for comment, 65 FR 16511 
(March 29, 2000) (adopted as final, 65 FR 47830 (August 4, 2000)), by 
final rule (after a proposed rule, 65 FR 53942 (September 6, 2000)), 67 
FR 12443 (March 19, 2002), and by interim rule, with request for 
comment, 70 FR 69041 (November 14, 2005).
    The Office of Government Ethics is proposing to amend part 2640 by 
adding a new regulatory exemption and clarifying the scope of an 
existing exemption, as explained below. This proposed rule is being 
published after obtaining the concurrence of the Department of Justice 
pursuant to section 201(c) of Executive Order 12674. 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 rule.

II. Analysis of the Proposed Changes

    The proposed rule would add a new regulatory exemption, section 
2640.203(m), which would permit employees to participate in particular 
matters affecting the financial interests of nonprofit organizations in 
which they participate, in their official Government capacity, as 
officers, directors or trustees. The proposed rule also would clarify 
that the existing regulatory exception for certain interests in sector 
mutual funds, at section 2640.201(b), also covers interests in sector 
unit investment trusts.

A. Proposed Section 2640.203(m)--Official Participation in Nonprofit 
Organizations

    Proposed section 2640.203(m) addresses a situation that was not 
generally thought to be covered by 18 U.S.C. 208 until the mid-1990s. 
Until that time, a number of agencies had a practice of assigning 
employees to participate on the boards of directors of certain outside 
nonprofit organizations, where such service was deemed to further the 
statutory mission and/or personnel development interests of the agency. 
The nonprofit organizations included such entities as professional 
associations, scientific societies, and health information promotion 
organizations. At the time, neither the agencies involved nor the 
Office of Government Ethics viewed such official participation in 
nonprofit organizations as being prohibited by 18 U.S.C. 208.
    However, in 1996, the Office of Legal Counsel (OLC) at the 
Department of Justice issued an opinion concluding that section 208 
generally prohibits an employee from serving, in an official capacity, 
as an officer, director or trustee of a private nonprofit organization. 
Memorandum of Deputy Assistant Attorney General, OLC, for General 
Counsel, Federal Bureau of Investigation, November 19, 1996, 
http:[sol][sol]www.justice.gov/olc/fbimem.2.htm. This conclusion was 
premised in large part on the fact that officers, directors and 
trustees of an outside organization owe certain

[[Page 24817]]

fiduciary duties to the organization under state law, which may 
conflict with the primary duty of loyalty that all Federal employees 
owe to the United States. As a consequence of this interpretation, 
employees are no longer permitted to serve in their official capacity 
as officer, director or trustee of an outside nonprofit organization, 
absent an individual waiver under 18 U.S.C. 208(b) or some specific 
statutory authority permitting such service.\1\
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    \1\ In rare instances, an employee also may be able to serve 
pursuant to a waiver of fiduciary duties by the organization, if 
such a waiver is permitted by state law. See Memorandum of Deputy 
Assistant Attorney General, OLC, to General Counsel, General 
Services Administration, August 7, 1998, 
http:[sol][sol]www.justice.gov/olc/gsa208fn.htm.
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    Since the 1996 OLC opinion, some agencies have continued to assign 
employees to serve on such outside boards by granting the employees 
individual waivers under 18 U.S.C. 208(b)(1). Other agencies have 
declined to issue individual waivers (or have done so rarely), often 
because of discomfort about waiving the application of a criminal 
statute. OGE has fielded numerous inquiries and has held many meetings 
with agencies and nonprofit organizations, mostly professional and 
scientific societies, concerning the application of section 208 to 
prevent official participation on outside boards. Several of the 
agencies and nonprofit organizations have argued that the application 
of section 208 has created unfortunate barriers to professional 
development and meaningful exchange between Federal and non-Federal 
experts in certain professions and areas of expertise. Moreover, some 
of the organizations have pointed out that there is a lack of 
uniformity within the Executive Branch, owing to the willingness of 
some agencies to grant waivers and the unwillingness of other agencies 
to do so, often with respect to participation in the same organization.
    Additionally, the Office of Government Ethics has noted the 
potential for confusion in some instances when employees are permitted 
to serve only in a private, rather than official, capacity. Especially 
where the agency has policy interests that overlap with those of the 
nonprofit organization, it can be very difficult for the employee to 
avoid the mistaken impression that he or she is acting in an official 
capacity when participating in the organization. Employees may be 
uncertain about the extent to which they are permitted to make 
reference to their official position or to use official time or agency 
resources. See 5 CFR 2635.702(b); 2635.704; 2635.705. Such confusion no 
doubt could be reduced by clearer agency instructions concerning such 
matters as excused absence and limited use of agency resources in 
support of outside professional and other organizations. See 5 CFR 
251.202. Nevertheless, the fact remains that sometimes there is 
considerable continuity in subject matter between an employee's 
official duties and the employee's activities in an outside nonprofit 
organization, and some agencies believe it would be clearer to permit 
the latter to occur while the employee is on official duty, without the 
impediment of section 208.\2\
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    \2\ Nothing in the proposed rule limits the ability of an 
employee to serve as officer, director or trustee of a nonprofit 
organization as a personal outside activity, where the agency has 
not assigned the employee to serve in an official capacity. 
Moreover, nothing in the proposed rule is intended to affect the 
current ability of agencies to assign employees to serve as official 
liaisons or to serve in similar nonfiduciary positions that do not 
implicate 18 U.S.C. 208. See OGE Informal Advisory Letter 95 x 8.
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    For all of the above reasons, the Office of Government Ethics in 
2006 recommended to the President and Congress that section 208 be 
amended ``to specify that the financial interests of an organization 
are not imputed to an employee who serves as an officer or director of 
such organization in his or her official capacity.'' OGE, Report to the 
President and to Congressional Committees on the Conflict of Interest 
Laws Relating to Executive Branch Employment 33 (2006) (2006 Report), 
http:[sol][sol]www.usoge.gov/ethics_docs/publications/reports_
plans.aspx.\3\ In the 2006 Report, OGE recognized that it had 
``regulatory authority to exempt financial interests arising from 
official service on boards of directors,'' but OGE opted at that time 
to place the issue before Congress first. No legislative changes to 
section 208 were enacted in response to the report, however, and OGE 
has continued to receive expressions of concern about this matter, both 
from agencies and from nonprofit organizations.
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    \3\ OGE was required to issue this report, in consultation with 
the Department of Justice, by section 8403(d) of the Intelligence 
Reform and Terrorism Prevention Act of 2004, Public Law 108-458 
(December 17, 2004).
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    Then, on March 9, 2009 President Obama issued a Memorandum for the 
Heads of Executive Departments and Agencies on the topic of scientific 
integrity. 74 FR 10671, 3 CFR, 2009 Comp., p. 354. In this memorandum, 
he specifically requested that the Office of Science and Technology 
Policy (OSTP) provide recommendations to address, among other things, 
the retention of staff in scientific and technical positions within the 
Executive branch. In response, the Director of OSTP issued a memorandum 
urging all agencies to establish policies that promote and facilitate 
the professional development of Government scientists and engineers. 
John P. Holdren, Director, OSTP, ``Scientific Integrity,'' Memorandum 
for the Heads of Executive Departments and Agencies, at 3, December 17, 
2010. The OSTP memorandum specifically calls for policies to ``[a]llow 
full participation in professional or scholarly societies, committees, 
task forces and other specialized bodies of professional societies, 
including removing barriers for serving as officers or on governing 
boards of such societies.'' Id. at 4 (emphasis added).
    In response to parallel initiatives, in August of 2010, the 
Director of the Office of Personnel Management (OPM) wrote to OGE to 
express several concerns about the application of section 208 to 
employees serving in their official capacity as officers and directors 
of scientific and professional organizations. Letter of John Berry, 
Director, OPM, to Robert I. Cusick, Director, Office of Government 
Ethics, August 16, 2010 (OPM Letter). Among other things, the Director 
of OPM wrote:

    Policies restricting Federal scientists' and professionals' 
involvement in professional organizations negatively impact the 
agencies employing such individuals. Restrictions act as a barrier 
to employees achieving professional stature in their respective 
fields, which may discourage scientists and professionals from 
considering Federal employment. Restrictions also serve to isolate 
scientists and professionals from the full exchange of knowledge and 
ideas necessary to stay current and participate fully as members of 
the greater scientific community. As a result, Federal scientists 
and professionals are hampered in their ability to provide the best 
possible advice and service to their respective agencies. These 
restrictions are particularly burdensome for the ``research-grade'' 
scientists whose retention and promotion evaluations depend in part 
on the recognition of stature by one's scientific peers. U. S. 
Office of Personnel Management's Research Grade Evaluation Guide, 
Factor 4; Contributions, Impact, and Stature, September, 2006; 
http:[sol][sol]www.opm.gov/Fedclass/gsresch.pdf.

OPM Letter at 2. The Director of OPM asked OGE to consider exercising 
its authority under 18 U.S.C. 208(b)(2) to exempt the financial 
interests of organizations in which employees serve in their official 
capacity, on the ground that such interests are ``too remote and 
inconsequential to warrant disqualification pursuant to section 208.'' 
Id. at 3. In response, the Director of OGE wrote that OGE takes ``very 
seriously'' OPM's ``concerns about the impact that the current bar has 
on the

[[Page 24818]]

professional development of employees.'' Letter of Robert I. Cusick, 
Director, OGE, to John Berry, Director, OPM, September 23, 2010.
    To address OPM's concerns, as well as the concerns raised by other 
agencies and outside organizations since 1996, and consistent with 
Administration efforts designed to ensure scientific integrity, OGE has 
concluded that it is now appropriate to exercise its authority under 18 
U.S.C. 208(b)(2) to exempt the imputed financial interests of nonprofit 
organizations in which employees serve as officers, directors or 
trustees in their official capacity. OGE has determined that such 
financial interests are too remote or inconsequential to affect the 
integrity of employees' services, for several reasons. As explained in 
OGE's 2006 Report, which was issued after consultation with the 
Department of Justice:

    OGE believes that the conflict identified by OLC [between the 
employee's duty of loyalty to the Government and the employee's 
fiduciary duties to the outside organization] may be more 
theoretical than real, particularly because employees assigned to 
serve on outside boards remain subject to important Federal 
controls, such as the authority to review and approve (or deny) the 
official activity in the first place, and the authority to order the 
individual to limit the activity, or even resign the position, in 
the event of a true conflict with Federal interests. In addition, an 
agency generally approves such activities only where the 
organization's interests are in consonance with the agency's own 
interests. In an era when `public/private partnerships' are promoted 
as a positive way for Government to achieve its objectives more 
efficiently, ethics officials find it difficult to explain and 
justify to agency employees why a waiver is required for official 
board services that have been determined by the agency to be proper. 
2006 Report at 33.

    In short, the potential for a real conflict of interest is too 
remote or inconsequential to affect the integrity of an employee's 
services under these circumstances.
    That is not to say, however, that agencies would be precluded from 
imposing meaningful controls and limits on employees serving in 
nonprofit organizations. As made clear in the Note following proposed 
section 2640.203(m), agencies must satisfy themselves that they have 
authority to assign employees to serve in such organizations in the 
first place; the proposed exemption does not itself constitute such 
authority, but simply removes the bar of the conflict of interest law. 
Moreover, agency decisions to permit (or not permit) official 
participation in any particular outside organization will be informed 
by numerous legal, policy, and managerial considerations, such as: the 
degree to which the activity will further the agency's statutory 
mission; the availability of agency funds and other resources to 
support such activities; the degree to which the agency is able and 
willing to assign employees to serve in other, similar organizations 
without appearing to single out one organization unreasonably; and the 
demands of the agency's workload and the particular employee's other 
assignments.\4\ Even where an agency does permit an employee to serve 
as officer, director or trustee of a nonprofit organization, the agency 
has discretion to limit or condition the official duty activity in a 
manner consistent with the needs and interests of the agency. This may 
include limits on participation in lobbying, fundraising, regulatory, 
investigational, or representational activities, as determined by the 
agency. For example, where agencies have granted individual waivers in 
the past, under section 208(b)(1), some agencies have required 
employees to refrain from participating in the fundraising activities 
of the outside organization or from participating in agency decisions 
to award grants or contracts to the organization; agencies will remain 
free to impose similar limits as they deem appropriate in the 
future.\5\ See OGE Memorandum DO-07-006, http://www.usoge.gov/ethics_guidance/daeograms/dgr_files/2007/do07006.html In other words, nothing 
in the proposed regulatory exemption is intended to interfere with the 
discretion of agencies to assign duties and describe the limits of 
official assignments, including assignments that involve outside 
nonprofit organizations.
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    \4\ Even prior to the 1996 OLC opinion, some agencies rarely if 
ever permitted employees to serve as officers, directors or trustees 
of outside organizations in an official capacity, because of fiscal, 
policy or managerial concerns. Notwithstanding the proposed 
regulatory exemption, some agencies may continue to decline to 
assign employees to serve in an official capacity for similar 
reasons.
    \5\ In any event, agency decisions to permit an employee to 
engage in official fundraising for a nonprofit organization must 
take into account the requirements of 5 CFR 2635.808(b) and 5 CFR 
part 950.
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    Finally, OGE notes that the proposed rule refers generally to 
``nonprofit'' organizations. See, e.g. ``Black's Law Dictionary'' 1080 
(1999) (``group organized for a purpose other than to generate income 
or profit''). The exemption thus is not limited to scientific 
organizations, but rather is intended to provide agencies with 
discretion to determine which nonprofit entities would further agency 
interests and would be appropriate for employee participation, 
including professional and other nonprofit groups focused on issues 
pertaining to legal practice, law enforcement, various social sciences, 
and other disciplines and public policy areas.

B. Proposed Clarifying Amendment to Section 2640.201(b)--Sector Unit 
Investment Trusts

    Among the regulatory exemptions currently found in subpart B of 
part 2640 are several that exempt certain financial interests in mutual 
funds and unit investment trusts. The Office of Government Ethics has 
promulgated exemptions for interests in the holdings of diversified 
mutual funds and diversified unit investment trusts (5 CFR 
2640.201(a)), in the non-sector holdings of sector mutual funds (5 CFR 
2640.201(b)(1)), and in the sector holdings of sector mutual funds when 
the aggregate market value of the employee's interest in the sector 
fund or funds does not exceed $50,000 (5 CFR 2640.201(b)(2)). Most 
recently, the Office of Government Ethics has promulgated one for 
interests in mutual funds and unit investment trusts other than 
interests arising from the holdings of such vehicles (5 CFR 
2640.201(d)). This exemption is limited to particular matters of 
general applicability, as defined in 5 CFR 2640.102(m).
    In promulgating these exemptions, the Office of Government Ethics 
recognized that pooled investment vehicles such as mutual funds and 
unit investment trusts generally pose fewer concerns that the financial 
interests will affect the integrity of the services of Government 
employees. The Office of Government Ethics has noted that usually 
``only a limited portion of the fund's assets [are] placed in the 
securities of any single issuer'' and that ``an employee's interest in 
any one fund is only a small portion of the fund's total assets.'' 60 
FR 47211 (September 11, 1995) (preamble to proposed rule).
    The Office of Government Ethics is proposing to amend the language 
of the exemptions for the interests in sector mutual funds to include 
explicitly the interests of sector unit investment trusts. The current 
regulation, 5 CFR 2640.201(b), does not include the language ``sector 
unit investment trusts.'' At the time that the sector fund exemptions 
were promulgated, the Office of Government Ethics contemplated that the 
exemptions would also extend to those investment vehicles organized as 
sector unit investment trusts. In practice, the Office of Government 
Ethics has permitted executive branch employees to apply the exemptions 
for interests in sector

[[Page 24819]]

mutual funds to interests in sector unit investment trusts.
    Therefore, OGE is proposing to add specific references to sector 
unit investment trusts to 5 CFR 2640.201(b) in order to clarify that 
the exemptions for interests in the holdings of sector mutual funds 
also apply to the interests in the holdings of sector unit investment 
trusts. OGE also is proposing conforming amendments to the definition 
in Sec.  2640.102(q), which would define both sector mutual fund and 
sector unit investment trust.

III. Matters of Regulatory Procedure

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 rule 
would 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 proposed regulation would not contain information 
collection requirements that require 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 proposed rule would 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 
involves rulemaking involves a nonmajor rule under the Congressional 
Review Act (5 U.S.C. chapter 8) and will, before the future final rule 
takes effect, submit a report thereon to the U.S. Senate, House of 
Representatives and General Accounting Office in accordance with that.

Executive Order 12866

    In proposing this rule amendment, 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. This proposed rule has also been 
reviewed by the Office of Management and Budget under that Executive 
order. Moreover, in accordance with section 6(a)(3)(B) of E.O. 12866, 
the preamble to this proposed amendment notes the legal basis and 
benefits of, as well as the need for, the regulatory action. There 
should be no appreciable increase in costs to OGE or the executive 
branch of the Federal Government in administering this proposed 
regulation, since it only adds to OGE's financial interests regulation 
a new regulatory exemption and a clarification of an existing 
exemption. Finally, this rulemaking is not economically significant 
under the Executive order and would not interfere with State, local or 
tribal governments.

Executive Order 12988

    As Director of the Office of Government Ethics, I have reviewed 
this proposed amendatory regulation in light of section 3 of Executive 
Order 12988, Civil Justice Reform, and certify that it meets the 
applicable standards provided therein.

List of Subjects in 5 CFR Part 2640

    Conflict of interests, Government employees.

    Approved: April 21, 2011.
Robert I. Cusick,
Director, Office of Government Ethics.

    Accordingly, for the reasons set forth in the preamble, the Office 
of Government Ethics proposes to amend 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. In Sec.  2640.102, paragraph (q) is revised to read as follows:


Sec.  2640.102  Definitions.

* * * * *
    (q) Sector mutual fund or sector unit investment trust means a 
mutual fund or unit investment trust that concentrates its investments 
in an industry, business, single country other than the United States, 
or bonds of a single State within the United States.
* * * * *

Subpart B--Exemptions Pursuant to 18 U.S.C. 208(b)(2)

    3. In Sec.  2640.201, paragraphs (b)(1) and (2) are revised to read 
as follows:


Sec.  2640.201  Exemptions for interests in mutual funds, unit 
investments trusts, and employee benefit plans.

* * * * *
    (b) Sector mutual funds and sector unit investment trusts. (1) An 
employee may participate in any particular matter affecting one or more 
holdings of a sector mutual fund or a sector unit investment trust 
where the affected holding is not invested in the sector in which the 
fund or trust concentrates, and where the disqualifying financial 
interest in the matter arises because of ownership of an interest in 
the fund or unit investment trust.
    (2)(i) An employee may participate in a particular matter affecting 
one or more holdings of a sector mutual fund or a sector unit 
investment trust where the disqualifying financial interest in the 
matter arises because of ownership of an interest in the fund or the 
unit investment trust and the aggregate market value of interests in 
any sector fund or funds and any sector unit investment trust or trusts 
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 and sector unit investment 
trusts 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.
* * * * *
    4. Section 2640.203 is amended by adding paragraph (m) to read as 
follows:


Sec.  2640.203  Miscellaneous exemptions.

* * * * *
    (m) Official participation in nonprofit organizations. An employee 
may participate in any particular matter where the disqualifying 
financial interest is that of a nonprofit organization in which the 
employee serves, solely in an official capacity, as an officer, 
director or trustee.

    Note to paragraph (m):  Nothing in this paragraph shall be 
deemed independent authority for an agency to assign an employee to 
serve in an official capacity with a particular nonprofit 
organization. Agencies will make such determinations based on an 
evaluation of their own statutory authorities and missions. 
Individual agency decisions to permit (or not permit) an employee to 
serve in an official capacity necessarily involve a range of legal, 
policy, and managerial considerations, and nothing in this paragraph

[[Page 24820]]

is intended to interfere with an agency's discretion to assign 
official duties and limit such assignments as the agency deems 
appropriate.


[FR Doc. 2011-10629 Filed 5-2-11; 8:45 am]
BILLING CODE 6345-03-P