not do so if the processes are seen to be compromised by conflicts of interests.

(c) What is a conflict of interests? A conflict of interests is a clash between an official's concern for the public interest and his or her private interests or allegiances. There are three primary sources: (1) Personal interests; (2) outside affiliations or relationships; and (3) gifts or favors. The examples that follow deliberately present situations that are not clear cut and do not illustrate specific rules you must follow. The pertinent rules appear elsewhere in these regulations.

(1) You might use your government position to further your personal interests, in conflict with the public interest.

Example: If as an NSF program official you recommended a conference of scientists in your field to discuss current issues, then chaired the conference yourself and delivered the principal paper, at least a inference suspicion would arise that you had used your Government position to further your own professional prestige or other personal inter

ests.

(2) Outside affiliations or relationships could affect the objectivity of your judgments as a public official.

Example: A proposal comes to you for handling. You received your degree from the applicant institution and were a professor there until recently. The proposed principal investigator is your cousin. You have potential conflicts of interests arising from both your academic affiliation and your family relationship.

(3) Gifts or favors from those interested in agency decisions could affect the objectivity or integrity of your contribution to those decisions.

Example: The chairman of a university department that regularly sends proposals to your unit is in town. After a late afternoon meeting he proposes dinner at a restaurant on his expense account. Acceptance of the dinner would create a potential conflict between your debt of gratitude towards him and your disinterested pursuit of the public interest.

(d) Inside access and influence. A special concern that underlies many of the conflicts rules is that your insider's access to other Federal officials and your inside influence with them might allow you to sway their decisions or actions

where you or those with whom you have ties are interested.

Example: A personal friend is principal investigator on a proposal pending in another part of your NSF unit. He asks you to check how things are going with that proposal. You talk with the program officer and division director handling the proposal. You not only check the status of the review, but mention what a fine scientist your friend is and how excellent his recent work has been. Your friendship with the investigator may influence your judgment on these points, and your inside influence may affect the actions and judgments of those with whom you talk. This creates a potential conflict between your private allegiance to your friend and the public interest.

(e) Conflicts that require prohibition or disqualification. Some conflicts of interests would so warp the performance of a Government agency or damage its credibility that they simply cannot be allowed to occur. (If a proposal from a member of your family or from your home institution comes into your program, for instance, you would clearly have to disqualify yourself from handling it.) Most Federal conflict-of-interests laws and a few conflicts rules special to the NSF deal with conflicts or potential conflicts of this sort. They therefore either flatly prohibit you from doing certain things that could give rise to such conflicts or disqualify you from participating in matters where you would have a potentially serious conflict.

(f) Other conflicts. By no means all conflicts of interests are so serious and clear that flat prohibitions or disqualifications are appropriate. Many conflicts, though real, are subtle, even remote. The seriousness of others so depends on circumstances of the particular case that unvarying rules would be impractical. There are also countervailing considerations. When we flatly prohibit Federal employees from doing things others who are not Federal employees are free to do, we tend to make Federal employment unattractive and so reduce the competence of Government. Also, disqualifying officials from being involved with particular matters may remove those who are best qualified by expertise or experience to make the required judgments or effect the required actions. For these reasons, the conflicts laws and regulations do not

specifically address many potential or actual conflicts that are not serious enough to require flat prohibitions or disqualifications or not easily enough identified by general rule to permit them.

(1) In the handling of the proposals and other award-related applications, these regulations require that some such potential conflicts receive special attention from a designated directorate "conflicts official." The conflicts official considers the circumstances of each case and decides whether to require either a disqualification or some form of special handling. See part 681.

(2) Other actual or potential conflicts may not be covered by any specific rule. You should nonetheless be sensitive to them and do whatever seems wise either to avoid them altogether or to ensure that they affect neither the quality of NSF decisions nor public trust in those decisions.

§ 680.13 Summary of additional responsibilities.

Apart from the conflicts rules for all employees summarized in the preceding section, these regulations impose the following additional responsibilities:

(a) Directorates and staff offices. Each directorate and staff office is responsible for designating "conflicts officials" and for making sure that all staff who handle proposals and other applications know who the conflicts officials are (§681.10(d)).

(b) Directorate (and staff-office) "conflicts officials". If your directorate or staff office has designated you as a conflicts official, your responsibilities are described in part 681, subpart D,

(§§ 681.40-681.44).

(c) Officials who are recruiting new professional employees. If NSF officials who are recruiting determine that a person has become a "prospective employee", they are responsible for bringing that fact and subsequent developments to the attention of a directorate (or staff-office) conflicts official. Whenever a person currently listed in the NSF principal investigator/project director file seems likely to become an NSF employee, the directorate or office which has recruited that person

must inform the Division of Information Systems by memo (so that the principal investigator/project director file can be "flagged" accordingly). It must also send copies of the memo to each NSF division or office that is responsible for an active award or pending proposal involving that person. These and related requirements are further described in part 681, subpart C, (§§ 681.30-681.33).

(d) Directorate for Administration. The Assistant Director for Administration is responsible for "flagging" the principal investigator/project director file to indicate those who are incoming, current, recent employees (§ 681.33(d)).

or

§680.14 Summary of special rules for full-time Presidential appointees.

If you are a Presidential appointee, you are subject to special additional rules:

(a) You must file a public Financial Disclosure Report within 5 days of your nomination to your position by the President. (§ 683.11)

(b) You may not earn from other outside activities income totalling more than 15 percent of your Government salary in any calendar year. (§683.30)

(c) You are not subject to the restrictions on political activity, except to those concerning use of official authority or influence for political purposes. (§ 683.40)

[47 FR 32131, July 26, 1982, as amended at 51 FR 22939, June 24, 1986]

(a) Summary. This section covers some standards of conduct for Government employees that are not covered elsewhere in the NSF regulations. Most of them are basic standards of integrity, decency, and obedience to law. Violation of any of these standards is grounds for serious disciplinary action.

(b) Underlying intent. The intent of these regulations generally is that you should not:

(1) Engage in criminal, infamous, dishonest, immoral, or notoriously disgraceful conduct or in any other conduct prejudicial to the Government or to Government efficiency or economy;

(2) Use your public office for private gain;

(3) Give preferential treatment;

(4) Have direct or indirect financial interests that conflict substantially, or appear to conflict substantially, with your Government duties and responsibilities;

(5) Engage directly or indirectly in financial transactions based on information obtained through your Government employment that is not available to the general public;

(6) Lose your independence or impartiality; or

(7) Make Government decisions outside of the proper official channels.

(c) Preserving public trust. You are responsible for helping to earn and maintain the confidence of the public in the integrity of the Government. This requires you to be concerned with appearances of as well as actual conflicts.

(d) Payment of taxes and debts. You are expected to pay your taxes and your just debts properly and on time. ("Just debts" means those you acknowledge or that have been reduced to final judgment. The Government will not try to determine the validity or amount of any disputed debt.)

(e) Gambling. You must not gamble in a Government office or while on duty. This includes participating in a sports pool or a lottery not officially sanctioned by the NSF.

(f) Familiarity with statutory provisions. You are legally responsible for acquainting yourself with each statute that relates to your conduct as an NSF and Federal employee. Principal among these are the criminal statutes relating to bribery, graft, and conflicts of interests contained in 18 U.S.C. 201 through 209; these regulations cover those provisions as they apply to NSF employees. These regulations also cover the provisions of Executive Order 11222, which prescribes standards of ethical conduct for Government officers and employees. They cover regulations of the Office of Personnel and Management that implement both the criminal statutes and the Executive Order. If you follow these regulations, you should have no trouble with any of those provisions. Not covered in these regulations, however, are the following statutory provisions:

(6) The prohibition against misuse of the franking privilege (18 U.S.C. 1719).

(7) The prohibition against use of deceit in an examination or personnel action in connection with Government employment (18 U.S.C. 1917).

(8) The prohibition against fraud or false statements in a Government matter (18 U.S.C. 1001).

(9) The prohibition against mutilating or destroying a public record (18 U.S.C. 2071).

(10) The prohibition against counterfeiting or forging transporation requests (18 U.S.C. 508).

(11) The prohibitions against embezzling Government money or property (18 U.S.C. 641); failing to account for public money (18 U.S.C. 643); and embezzling the money or property of an employee by reason of his employment (18 U.S.C. 654).

(12) The prohibition against unauthorized use of documents relating to claims from or by the Government (18 U.S.C. 285).

(13) The prohibition against acting as the agent of a foreign principal registered under the Foreign Agents Registration Act (18 U.S.C. 219).

$ 680.16 Key terms.

Except where provisions plainly indicate otherwise, certain other terms are used throughout these regulations in standard meanings:

(a) Award means any grant, contract, cooperative agreement, loan, or other arrangement made by the Government.

(b) Project means the unit of work that an award supports or helps support.

(c) Proposal means an application for an award and includes a bid.

(d) Other award-related application means a request for an award amendment, for an increment to a continuing grant, for a no-cost extension, or for an administrative approval.

(e) Institution means any university, college, business firm, research institute, professional society, or other organization. It includes any university consortium or joint corporation such as AUI, AURA, or JOI, Inc., but not the universities that belong to it. It includes all parts of a university or college, including separate campuses. It does not include other universities or colleges in a multi-institution state or city system, unless you are an employee of the central system offices or an officer, trustee, or equivalent of the system as a whole.

(f) Directorate means an NSF directorate, staff office, or other organization that reports immediately to the NSF Director.

(g) Program Officer includes assistant and associate program officers or program managers.

Subpart B-Statutory Exemptions §680.20 Necessity and effect of formal exemptions.

The exemptions described in this subpart are provided for by statute, which requires that they be formally promulgated. This subpart provides the formal promulgation and gives notice to the public. If you are an NSF employee, you need not be concerned with them. Anything you need to know that follows from them is either covered elsewhere in these regulations or will be explained if occasion arises by an ethics counselor.

$ 680.21 Exemptions under 18 U.S.C. 208(b).

(a) The Foundation exempts the interests described in the remainder of this section from the operation of section 208(a) and from case-by-case formal determinations under section 208(b)(1) of title 18, United States Code.

(b) Minor interests. The following financial interests are too inconsequential to affect the integrity of an employee's services to the Government:

(1) Noncorporate bonds; (2) Shares in a well-diversified money market or mutual fund;

(3) Stocks, bonds, or other securities of a corporation listed on the New York or American Stock Exchange if the aggregate market value of all the securities you hold in that corporation does not exceed $1,000;

(4) Vested pension rights to which no further contributions are being made by your former employer.

(c) Indirect interests. An NSF employee may be a stockholder, partner, employee, officer, or director of an institution, such as a mutual fund, that owns a financial interest in a second institution. If the owning institution's financial interest consists of securities or other evidences of debt of the second institution that amount to:

(1) Less than 5 percent of the total portfolio of investments of the owning institution,

(2) Less than 5 percent of the total outstanding amounts of the same classes of securities of the second institution, and

(3) Less than would be needed to obtain effective control of the second institution,

then the interest is too remote and inconsequential to affect the integrity of the employee's services to the Government.

(d) Policy determinations. Where a general policy determination of the Government might constitute a "particular matter" under 18 U.S.C. 208(a) and might affect the home institution of an NSF officer or employee, but only in the same manner as all similar institutions, the officer or employee may participate in that determination.

(e) Support services for National Science Board tasks and responsibilities. A member of the National Science Board may need professional, clerical, and administrative services to support the member's personal efforts to carry out Board tasks and responsibilities. With the approval of the Director and the Chairman of the National Science Board and in accordance with other laws and regulations, the NSF may contract with the home insitution of the member to provide such services. The institution may receive reimbursement of all allowable costs, but no

Subpart A-Summary

§681.10 Summary.

(a) Two types of problems could affect the judgments of program officers and other NSF officials who handle proposals and other applications:

(1) The official might possess outside interests, affiliations, or relationships that could create bias; or

(2) Another NSF employee could have an involvement or interest in the proposal or application.

Whenever either of these problems arises, the official who would normally handle the proposal or other application is asked to bring the problem to the attention of a "directorate conflicts official". This conflicts official examines the case; decides what disqualifications or special handling arrangements, if any, are called for; and places a memo in the file explaining the circumstances and any arrangements made to deal with them. In some cases disqualifications are routine or automatic.

(b) Peer reviewers can also have interests, affiliations, or relationships that might affect their reviews. Reviewers are asked to reveal any such interests, affiliations, or relationships. Those are then taken into account by NSF officials in making decisions or recommendations based on the reviews.

(c) If you are a program officer or other NSF official who handles proposals and other award-related applications, your responsibilities in these matters are explained in subpart B (§§ 681.20-681.26).

(d) Each directorate or staff office of the Foundation is responsible for designating "conflicts officials" and for making sure that all staff who handle proposals and other applications know who the conflicts officials are. The conflicts officials need not be in the directorate front office. They could, for example, be division directors.

(e) If you have been designated as a directorate (or staff office) conflicts official, your responsibilities in these matters are explained in subpart D (§§ 681.40 through 681.44) of this part, which also provides guidance to help you carry out those responsibilities.