February 1998
Gift and Gratuity Rules for Government Contractors
Arnold & Porter Article
Restrictions on Government Contractors
Criminal violation to provide any "thing of value" to a public officialRestrictions on Government EmployeesWith the intent to influence any official act; orContractor may not
For, or because of, any official act. 18 U.S.C. § 201Offer or give a gratuity to an officer, official, or employee of the Government.Penalties include termination of contract for default, exemplary damages of three to ten times the costs the contractor incurred in giving the gratuity, and other remedies allowed by law. Id.
If the contractor intended by the gratuity to obtain a contract or favorable treatment under a contract. FAR 52.203-3.
General prohibition on gifts, gratuities, entertainment, loans, or anything of value from anyoneRestrictions Related to Non-Federal EmploymentWho has business or is seeking business from the employee's agency, orExceptions Include:
Who conducts activities that are regulated by the employee's agency, or
Who has interests that may be "substantially affected" by the performance of the employee's duties. FAR 3.101-2.De Minimus Exception ($50/20)
Based on Personal/Familial Relationship
Widely Attended Gatherings
Modest items of food or drink other than as part of a meal (coffee, donuts, etc.)
Agency official "personally and substantially" involved in a procurement who is contacted by contractor regarding possible non-Federal employment mustPromptly report the contact in writing; andFormer Government official may not accept compensation from a contractor for one year if the official
Reject the possible non-Federal employment; or
Disqualify him/herself from further involvement in the procurement. FAR 3.104-4(c).Served in identified positions (e.g., contracting officer, source selection authority, source selection board member, program manager), orThese restrictions - imposed by the Procurement Integrity Act and its implementing regulations - are in addition to any Ethics in Government Act Restrictions.
Made contract decisions (e.g., issued contract modifications, set overhead rates, settled claims) regarding a contracts or claim of more than $10 million. FAR 3.104-4(d).