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(b) Each person shall file a certifi. this section. That person shall forward cation, and a disclosure form, if re- all disclosure forms to the agency. quired, upon receipt by such person of: (8) Any certification or disclosure

(1) A Federal contract, grant, or co- form filed under paragraph (e) of this operative agreement exceeding $100,000; section shall be treated as a material or

representation of fact upon which all (2) A Federal loan or a commitment receiving tiers shall rely. All liability providing for the United States to in arising from an erroneous representasure or guarantee a loan exceeding tion shall be borne solely by the tier $150,000,

filing that representation and shall not unless such person previously filed a be shared by any tier to which the ercertification, and a disclosure form, if roneous representation is forwarded. required. under paragraph (a) of this Submitting an erroneous certification section.

or disclosure constitutes à failure to (c) Each person shall file a disclosure file the required certification or discloform at the end of each calendar quar sure, respectively. If a person fails to ter in which there occurs any event ne a reqi

file a required certification or disclothat requires disclosure or that materi- sure, the United States may pursue all ally affects the accuracy of the infor available remedies, including those aumation contained in any disclosure thorized by section 1352, title 31, U.S. form previously filed by such person Code. under paragraph (a) or (b) of this sec

(g) For awards and commitments in tion. An event that materially affects

process prior to December 23, 1989, but the accuracy of the information re

not made before that date, certifiported includes:

cations shall be required at award or (1) A cumulative increase of $25,000 or commitment, covering activities ocmore in the amount paid or expected to curring between December 23, 1989, and be paid for influencing or attempting. the date of award or commitment. to influence a covered Federal action;

However, for awards and commitments

in process prior to the December 23, (2) A change in the person(s) or

1989 effective date of these provisions, individual(s) influencing or attempting

but not made before December 23, 1989, to influence a covered Federal action;

disclosure forms shall not be required or,

at time of award or commitment but (3) A change in the officer(s), shall be filed within 30 days. employee(s), or Member(s) contacted to (h) No reporting is required for an acinfluence or attempt to influence a tivity paid for with appropriated funds covered Federal action.

if that activity is allowable under ei(d) Any person who requests or re ther subpart B or C. ceives from a person referred to in paragraph (a) or (b) of this section:

Subpart B-Activities by Own (1) A subcontract exceeding $100,000

Employees at any tier under a Federal contract;

(2) A subgrant, contract, or sub- 8604.200 Agency and legislative liai. contract exceeding $100,000 at any tier son. under a Federal grant;

(a) The prohibition on the use of ap(3) A contract or subcontract exceed- propriated funds, in 8 604.100 (a), does ing $100,000 at any tier under a Federal not apply in the case of a payment of loan exceeding $150,000; or,

reasonable compensation made to an (4) A contract or subcontract exceed officer or employee of a person requesting $100,000 at any tier under a Federal ing or receiving a Federal contract, cooperative agreement,

grant, loan, or cooperative agreement shall file a certification, and a disclo if the payment is for agency and legissure form, if required, to the next tier lative liaison activities not directly re

lated to a covered Federal action. (e) All disclosure forms, but not cer- (b) For purposes of paragraph (a) of tifications, shall be forwarded from this section, providing any information tier to tier until received by the person specifically requested by an agency or referred to in paragraph (a) or (b) of Congress is allowable at any time.

or

above.

(c) For purposes of paragraph (a) of agreement or for meeting requirements this section, the following agency and imposed by or pursuant to law as a legislative liaison activities are allow- condition for receiving that Federal able at any time only where they are contract, grant, loan, or cooperative not related to a specific solicitation for agreement. any covered Federal action:

(b) For purposes of paragraph (a) of (1) Discussing with an agency (in

this section, "professional and techcluding individual demonstrations) the

nical services" shall be limited to adqualities and characteristics of the per

vice and analysis directly applying any son's products or services, conditions

professional or technical discipline. or terms of sale, and service capabili

For example, drafting of a legal docuties; and, (2) Technical discussions and other

ment accompanying a bid or proposal

by a lawyer is allowable. Similarly, activities regarding the application or

technical advice provided by an engiadaptation of the person's products or

neer on the performance or operational services for an agency's use. (d) For purposes of paragraph (a) of

capability of a piece of equipment renthis section, the following agencies and

dered directly in the negotiation of a legislative liaison activities are allow

contract is allowable. However, comable only where they are prior to for

munications with the intent to influmal solicitation of any covered Federal

ence made by a professional (such as a action:

licensed lawyer) or a technical person (1) Providing any information not

(such as a licensed accountant) are not specifically requested but necessary for

allowable under this section unless an agency to make an informed deci- they provide advice and analysis dision about initiation of a covered Fed- rectly applying their professional or eral action;

technical expertise and unless the ad(2) Technical discussions regarding vice or analysis is rendered directly the preparation of an unsolicited pro- and solely in the preparation, submisposal prior to its official submission; sion or negotiation of a covered Fedand,

eral action. Thus, for example, commu(3) Capability presentations by per- nications with the intent to influence sons seeking awards from an agency made by a lawyer that do not provide pursuant to the provisions of the Small legal advice or analysis directly and Business Act, as amended by Public solely related to the legal aspects of Law 95-507 and other subsequent his or her client's proposal, but genamendments.

erally advocate one proposal over an(e) Only those activities expressly au

other are not allowable under this secthorized by this section are allowable

tion because the lawyer is not providunder this section.

ing professional legal services. Simi8 604.205 Professional and technical

larly, communications with the intent services.

to influence made by an engineer pro

viding an engineering analysis prior to (a) The prohibition on the use of ap

the preparation or submission of a bid propriated funds, in $604.100 (a), does

or proposal are not allowable under not apply in the case of a payment of

this section since the engineer is pro-reasonable compensation made to an

viding technical services but not diofficer or employee of a person request

rectly in the preparation, submission ing or receiving a Federal contract, grant, loan, or cooperative agreement

or negotiation of a covered Federal acor an extension, continuation, renewal,

tion. amendment, or modification of a Fed- (c) Requirements imposed by or pureral contract, grant, loan, or coopera

suant to law as a condition for receivtive agreement if payment is for pro

ing a covered Federal award include fessional or technical services rendered those required by law or regulation, or directly in the preparation, submis- reasonably expected to be required by sion, or negotiation of any bid, pro- law or regulation, and any other reposal, or application for that Federal quirements in the actual award docucontract, grant, loan, or cooperative ments.

(d) Only those services expressly au- rectly applying their professional or thorized by this section are allowable technical expertise and unless the adunder this section.

vice or analysis is rendered directly

and solely in the preparation, submis8604.210 Reporting.

sion or negotiation of a covered FedNo reporting is required with respect eral action. Thus, for example, commuto payments of reasonable compensa nications with the intent to influence tion made to regularly employed offi made by a lawyer that do not provide cers or employees of a person.

legal advice or analysis directly and

solely related to the legal aspects of Subpart C-Activities by Other his or her client's proposal, but genThan Own Employees

erally advocate one proposal over an

other are not allowable under this sec$604.300 Professional and technical tion because the lawyer is not providservices.

ing professional legal services. Simi(a) The prohibition on the use of ap larly, communications with the intent propriated funds, in $604.100 (a), does

to influence made by an engineer pronot apply in the case of any reasonable

viding an engineering analysis prior to payment to a person, other than an of the preparation or submission of a bid ficer or employee of a person request or proposal are not allowable under ing or receiving a covered Federal ac

this section since the engineer is protion, if the payment is for professional

viding technical services but not dior technical services rendered directly rectly in the preparation, submission in the preparation, submission, or ne or negotiation of a covered Federal ac- . gotiation of any bid, proposal, or appli

tion. cation for that Federal contract, grant, (d) Requirements imposed by or purloan, or cooperative agreement or for suant to law as a condition for receivmeeting requirements imposed by or ing a covered Federal award include pursuant to law as a condition for re those required by law or regulation, or ceiving that Federal contract, grant, reasonably expected to be required by loan, or cooperative agreement.

law or regulation, and any other re(b) The reporting requirements in quirements in the actual award docu$604.110 (a) and (b) regarding filing a ments. disclosure form by each person, if re (e) Persons other than officers or emquired, shall not apply with respect to ployees of a person requesting or reprofessional or technical services ren- ceiving a covered Federal action indered directly in the preparation, sub- clude consultants and trade associamission, or negotiation of any commit tions. ment providing for the United States (f) Only those services expressly auto insure or guarantee a loan.

thorized by this section are allowable (c) For purposes of paragraph (a) of

under this section. this section, “professional and technical services” shall be limited to ad

Subpart D-Penalties and vice and analysis directly applying any professional or technical discipline.

Enforcement For example, drafting or a legal document accompanying a bid or proposal

8 604.400 Penalties. by a lawyer is allowable. Similarly, (a) Any person who makes an expendtechnical advice provided by an engi- iture prohibited herein shall be subject neer on the performance or operational to a civil penalty of not less than capability of a piece of equipment ren- $10,000 and not more than $100,000 for dered directly in the negotiation of a each such expenditure. contract is allowable. However, com- (b) Any person who fails to file or munications with the intent to influ- amend the disclosure form (see Appenence made by a professional (such as a dix B) to be filed or amended if relicensed lawyer) or a technical person quired herein, shall be subject to a civil (such as a licensed accountant) are not penalty of not less than $10,000 and not allowable under this section unless more than $100,000 for each such failthey provide advice and analysis di- ure.

Subpart E-Exemptions

8 604.500 Secretary of Defense.

(a) The Secretary of Defense may exempt, on a case-by-case basis, a covered Federal action from the prohibition whenever the Secretary determines, in writing, that such an exemption is in the national interest. The Secretary shall transmit a copy of each such written exemption to Congress immediately after making such a determination.

(b) The Department of Defense may issue supplemental regulations to implement paragraph (a) of this section.

(c) A filing or amended filing on or after the date on which an administrative action for the imposition of a civil penalty is commenced does not prevent the imposition of such civil penalty for a failure occurring before that date. An administrative action is commenced with respect to a failure when an investigating official determines in writing to commence an investigation of an allegation of such failure.

(d) In determining whether to impose a civil penalty, and the amount of any such penalty, by reason of a violation by any person, the agency shall consider the nature, circumstances, extent, and gravity of the violation, the effect on the ability of such person to continue in business, any prior violations by such person, the degree of culpability of such person, the ability of the person to pay the penalty, and such other matters as may be appropriate.

(e) First offenders under paragraphs (a) or (b) of this section shall be subject to a civil penalty of $10,000, absent aggravating circumstances. Second and subsequent offenses by persons shall be subject to an appropriate civil penalty between $10,000 and $100,000, as determined by the agency head or his or her designee.

(1) An imposition of a civil penalty under this section does not prevent the United States from seeking any other remedy that may apply to the same conduct that is the basis for the imposition of such civil penalty.

Subpart F-Agency Reports 8 604.600 Semi-annual compilation.

(a) The head of each agency shall collect and compile the disclosure reports (see Appendix B) and, on May 31 and November 30 of each year, submit to the Secretary of the Senate and the Clerk of the House of Representatives a report containing a compilation of the information contained in the disclosure reports received during the sixmonth period ending on March 31 or September 30, respectively, of that year.

(b) The report, including the compilation, shall be available for public inspection 30 days after receipt of the report by the Secretary and the Clerk.

(c) Information that involves intelligence matters shall be reported only to the Select Committee on Intelligence of the Senate, the Permanent Select Committee on Intelligence of the House of Representatives, and the Committees on Appropriations of the Senate and the House of Representatives in accordance with procedures agreed to by such committees. Such information shall not be available for public inspection.

(d) Information that is classified under Executive Order 12356 or any successor order shall be reported only to the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives or the Committees on Armed Services of the Senate and the House of Representatives (whichever such com

8 604.405 Penalty procedures.

Agencies shall impose and collect civil penalties pursuant to the provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 3812, insofar as these provisions are not inconsistent with the requirements herein.

8 604.410 Enforcement.

The head of each agency shall take such actions as are necessary to ensure that the provisions herein are vigorously implemented and enforced in that agency.

mittees have jurisdiction of matters lating to the agency's covered Federal involving such information) and to the actions during the year covered by the Committees on Appropriations of the report, the actions taken by the head Senate and the House of Representa of the agency in the year covered by tives in accordance with procedures the report with respect to those alleged agreed to by such committees. Such in violations and alleged violations in formation shall not be available for previous years, and the amounts of public inspection.

civil penalties imposed by the agency (e) The first semi-annual compilation in the year covered by the report. shall be submitted on May 31, 1990, and shall contain a compilation of the dis

APPENDIX A TO PART 604 closure reports received from Decem

CERTIFICATION REGARDING LOBBYING ber 23, 1989 to March 31, 1990.

Certification for Contracts, Grants, Loans, and (1) Major agencies, designated by the

Cooperative Agreements Office of Management and Budget

The undersigned certifies, to the best of his (OMB), are required to provide ma

or her knowledge and belief, that: chine-readable compilations to the

(1) No Federal appropriated funds have Secretary of the Senate and the Clerk been paid or will be paid, by or on behalf of of the House of Representatives no the undersigned, to any person for influenclater than with the compilations due ing or attempting to influence an officer or on May 31, 1991. OMB shall provide de employee of an agency, a Member of Contailed specifications in a memorandum

gress, an officer or employee of Congress, or

an employee of a Member of Congress in conto these agencies.

nection with the awarding of any Federal (8) Non-major agencies are requested

contract, the making of any Federal grant, to provide machine-readable compila

the making of any Federal loan, the entering tions to the Secretary of the Senate into of any cooperative agreement, and the and the Clerk of the House of Rep extension, continuation, renewal, amendresentatives.

ment, or modification of any Federal con(h) Agencies shall keep the originals tract, grant, loan, or cooperative agreement. of all disclosure reports in the official

(2) If any funds other than Federal appro

priated funds have been paid or will be paid files of the agency.

to any person for influencing or attempting 8 604.605 Inspector General report.

to influence an officer or employee of any

agency, a Member of Congress, an officer or (a) The Inspector General, or other employee of Congress, or an employee of a official as specified in paragraph (b) of Member of Congress in connection with this this section, of each agency shall pre

Federal contract, grant, loan, or cooperative pare and submit to Congress each year,

agreement, the undersigned shall complete

and submit Standard Form-LLL, "Disclocommencing with submission of the

sure Form to Report Lobbying," in accordPresident's Budget in 1991, an evalua

ance with its instructions. tion of the compliance of that agency (3) The undersigned shall require that the with, and the effectiveness of, the re language of this certification be included in quirements herein. The evaluation may the award documents for all subawards at all include any recommended changes that tiers (including subcontracts, subgrants, and may be necessary to strengthen or im

contracts under grants, loans, and cooperaprove the requirements.

tive agreements) and that all subrecipients

shall certify and disclose accordingly. (b) In the case of an agency that does

This certification is a material representanot have an Inspector General, the

tion of fact upon which reliance was placed agency official comparable to an In when this transaction was made or entered spector General shall prepare and sub into. Submission of this certification is a mit the annual report, or, if there is no prerequisite for making or entering into this such comparable official, the head of transaction imposed by section 1352, title 31, the agency shall prepare and submit

U.S. Code. Any person who fails to file the the annual report.

required certification shall be subject to a

civil penalty of not less than $10,000 and not (c) The annual report shall be submitted at the same time the agency

more than $100,000 for each such failure. submits its annual budget justifica Statement for Loan Guarantees and Loan tions to Congress.

Insurance (d) The annual report shall include The undersigned states, to the best of his the following: All alleged violations re- or her knowledge and belief, that:

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