[Code of Federal Regulations]

[Title 45, Volume 1]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 45CFR73.735-802]



[Page 185-186]

 

                        TITLE 45--PUBLIC WELFARE

 

                    SUBTITLE A--DEPARTMENT OF HEALTH

                           AND HUMAN SERVICES

 

PART 73_STANDARDS OF CONDUCT--Table of Contents

 

                      Subpart H_Financial Interest

 

Sec.  73.735-802  Executive order prohibitions.



    (a) Basic prohibition of Executive Order 11222. (1) An employee 

shall not have a direct or indirect financial interest that conflicts 

substantially, or appears to conflict substantially, with his or her 

duties as a Federal employee.

    (2) An employee need not have a financial interest that actually 

conflicts with his or her duties to violate the prohibition of E.O. 

11222. Any financial interest that could reasonably be viewed as an 

interest which might compromise the employee's integrity, whether or not 

this is in fact true, is subject to this prohibition.

    (3) Except as provided in Sec.  73.735-802 (b) and (c), an employee 

who has an indirect financial interest in a business entity through the 

ownership of shares in a widely-held mutual fund or other regulated 

investment company will not violate E.O. 11222. Stocks in business 

entities held by an intermediary such as a mutual fund are generally too 

remote or inconsequential to affect the integrity of an employee's 

services.

    (b) Employees in regulatory activities. (1) An employee who is 

working in a regulatory activity shall not have a financial interest in 

any company whose business activities are subject to the regulations of 

the particular activity with which the employee is associated, unless 

the regulated activities of the company are an insignificant part of its 

total business operations.

    (2) An employee working in a regulatory activity may not hold shares 

in a mutual fund or other regulated investment company which specializes 

in holdings in industries that are regulated by the particular activity 

in which he or she is employed.



    Example: An employee working for the Bureau of Laboratories, Centers 

for Disease Control, may not hold shares in a regulated investment 

company which specializes in holdings that include medical testing 

laboratories.



    (c) Employees having procurement or contracting responsibilities.

    (1) An employee who serves as a procurement or contracting officer 

shall not have a financial interest in a company or companies with which 

he or she in the course of his or her official duties would be likely to 

have procurement or contracting relationships.

    (2) A procurement or contracting officer may not hold shares in a 

mutual fund or other regulated investment company that specializes in 

holdings in industries with which such officer would be likely to have 

procurement or contracting relationships.



    Example: A contracting officer in the Social Security Administration 

owns shares in the XYZ Mutual Fund which specializes in stock in firms 

manufacturing electronic data processing equipment. Ownership of XYZ 

Mutual Fund shares would be prohibited in



[[Page 186]]



this instance. On the other hand, a contracting officer for a Public 

Health Service hospital, who is not likely to have responsibility for 

major contracts relating to electronic data processing, could hold such 

shares.