Supplemental Standards of Ethical Conduct for Employees of the Department of Veterans Affairs, 37800-37805 [2023-11772]

Agencies

• DEPARTMENT OF VETERANS AFFAIRS

[Federal Register Volume 88, Number 111 (Friday, June 9, 2023)]
[Proposed Rules]
[Pages 37800-37805]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-11772]


========================================================================
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.

========================================================================


Federal Register / Vol. 88, No. 111 / Friday, June 9, 2023 / Proposed 
Rules

[[Page 37800]]



DEPARTMENT OF VETERANS AFFAIRS

5 CFR Part 10501

RIN 3209-AA64


Supplemental Standards of Ethical Conduct for Employees of the 
Department of Veterans Affairs

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Veterans Affairs (``VA'' or ``Department''), 
with the concurrence of the Office of Government Ethics (OGE), is 
issuing this proposed rule for Department of Veterans Affairs 
employees. This document supplements the Standards of Ethical Conduct 
for Employees of the Executive Branch (OGE Standards) issued by OGE and 
is necessary because it addresses ethical issues unique to the 
Department of Veterans Affairs. The proposed rule requires employees to 
seek prior approval for outside employment with a prohibited source, 
with or without compensation. Prior approval would also be required for 
serving, with or without compensation, as an officer, director, 
trustee, general partner, employee, consultant, or contractor for a 
Veteran-centric organization. Attorneys in the Department of Veterans 
Affairs Office of General Counsel (OGC) would be subject to additional 
requirements regarding the outside practice of law.

DATES: Comments must be received on or before August 8, 2023.

ADDRESSES: Comments may be submitted through www.Regulations.gov. 
Except as provided below, comments received before the close of the 
comment period will be available at www.regulations.gov for public 
viewing, inspection, or copying, including any personally identifiable 
or confidential business information that is included in a comment. We 
post the comments received before the close of the comment period on 
the following website as soon as possible after they have been 
received: https://www.regulations.gov. VA will not post on 
Regulations.gov public comments that make threats to individuals or 
institutions or suggest that the commenter will take actions to harm 
the individual. VA encourages individuals not to submit duplicative 
comments. We will post acceptable comments from multiple unique 
commenters even if the content is identical or nearly identical to 
other comments. Any public comment received after the comment period's 
closing date is considered late and will not be considered in the final 
rulemaking.

FOR FURTHER INFORMATION CONTACT: Bruce Barnett, Deputy Ethics Official/
Staff Attorney, Ethics Specialty Team, VA Office of General Counsel, 
Department of Veterans Affairs, 810 Vermont Ave. NW, Washington, DC 
20420, (202) 503-8435. (This is not a toll-free telephone number.)

SUPPLEMENTARY INFORMATION: 

I. Background

    On August 7, 1992, OGE published the OGE Standards. See 57 FR 
35006-35067, as corrected at 57 FR 48557, 57 FR 52483, and 60 FR 51167, 
with additional grace period extensions for certain existing provisions 
at 59 FR 4779-4780, 60 FR 6390-6391, and 60 FR 66857-66858. The OGE 
Standards, codified at 5 CFR part 2635, effective February 3, 1993, 
established uniform standards of ethical conduct that apply to all 
executive branch personnel.
    Section 2635.105 of the OGE Standards authorizes an agency, with 
the concurrence of OGE, to adopt agency-specific supplemental 
regulations that are necessary to properly implement its ethics 
program. The Department of Veterans Affairs, with OGE's concurrence, 
has determined that the following supplemental regulations are 
necessary for successful implementation of its ethics program in light 
of the unique programs and operations of the Department.

II. Analysis of the Regulation

    Pursuant to Section 2635.803 of the OGE Standards, where it is 
determined to be necessary or desirable for the purpose of 
administering its ethics program, an agency shall by supplemental 
regulation require employees or any category of employees to obtain 
approval before engaging in specific types of outside activities, 
including outside employment. Additionally, under Section 2635.403(a) 
of the OGE Standards, an agency may, by supplemental regulation, 
prohibit its employees from having outside employment or other 
financial interests when the agency determines such outside employment 
or financial interests would cause a reasonable person to question the 
impartiality and objectivity with which agency programs are 
administered. Outside employment and activities prohibited by an 
agency's supplemental regulation would be considered ``conflicting 
outside employment'' or ``conflicting outside activities'' and 
therefore barred by 2635.802(a) of the OGE Standards.
    VA has determined that it is necessary and desirable for the 
purposes of administering its ethics program to impose on its employees 
the prior approval requirements described below. VA also has determined 
that certain employment or activities by attorneys in the Office of 
General Counsel involving the outside practice of law would cause a 
reasonable person to question the impartiality and objectivity with 
which VA programs are administered, necessitating additional 
restrictions for those employees.

Proposed Section 10501.101 General

    Section 10501.101 explains that these regulations apply to VA 
employees and supplement the OGE Standards.

Proposed Section 10501.102 Prior Approval for Certain Outside 
Employment and Other Outside Activities

    Paragraph (a) requires a VA employee, other than a special 
Government employee, to obtain written approval before engaging in 
certain outside employment or other outside activities. The prior 
approval requirement will be an integral part of VA's ethics program. 
VA believes this requirement is necessary to ensure that an employee's 
participation in outside employment or other outside activities does 
not adversely affect VA operations or place the employee at risk of 
violating applicable statutes and regulations governing employee 
conduct.
    Paragraph (a)(i) requires prior written approval before engaging, 
with or without compensation, in outside

[[Page 37801]]

employment, as defined in paragraph (b)(2) below, with a prohibited 
source (an entity that seeks official action by VA, does business or 
seeks to do business with VA, conducts activities regulated by VA, has 
interests that may be substantially affected by performance or 
nonperformance of the employee's official duties, or is an organization 
a majority of whose members fit into one or more of those categories). 
For example, VA spends millions of dollars on contracts with 
corporations and other entities for pharmaceuticals, medical devices, 
services, and other items in support of Veteran health care, engages in 
cooperative research and development agreements with pharmaceutical and 
medical device companies, and affiliates with medical schools whose 
physician and researcher employees also have appointments at VA. 
Requiring approval prior to engaging in outside employment with these 
and other prohibited sources is critical to protect against questions 
arising regarding the administration of VA programs and the 
impartiality and objectivity of VA employees. Because of the definition 
of outside employment in paragraph (b)(2), the prior approval 
requirement in paragraph (a)(i) does not attach to participation in 
activities of a nonprofit charitable, religious, professional, social, 
fraternal, educational, recreational, public service or civic 
organization, unless the participation involves the provision of 
professional services or advice for compensation.
    Paragraph (a)(ii) captures activities with certain nonprofit 
organizations that would not be captured by paragraph (a)(i) because of 
the definition of employment under paragraph (b)(2). It requires prior 
written approval before serving, with or without compensation, as an 
officer, director, trustee, general partner, employee, consultant, or 
contractor for a Veteran-centric organization, such as a Veteran 
Service Organization or other organization, business, corporation, or 
charity with a mission focused on Veterans. Requiring prior approval 
for these activities is critical to protect against questions arising 
regarding the administration of VA programs and the impartiality and 
objectivity of VA employees. For example, some Veteran-centric 
organizations receive agency-provided office space and office 
facilities in accordance with 38 U.S.C. 5902, have representatives that 
prepare, present, and prosecute claims under laws administered by the 
VA, are engaged in public-private partnerships with VA, or have other 
ties to VA regulated by Department law, regulation, or policy. They are 
prohibited sources, yet they typically also are nonprofits with a 
mission that is charitable, public service, or civic in nature. As 
such, prior approval for activities with many Veteran-centric 
organizations would not generally be required under paragraph (a)(1) 
because the definition of ``employment'' under paragraph (b)(2) 
excludes participation in the activities of certain nonprofits., The 
additional prior approval requirement of paragraph (a)(ii) is intended 
to address potentially serious ethical issues stemming from personal 
capacity leadership in, or other activities with, these organizations. 
The smaller universe of activities with Veteran-centric organizations 
requiring prior approval compared to what is required in paragraph 
(a)(i) for prohibited sources reflects the Department's historical 
experience with ethical issues arising from Veteran-centric 
organizations and the types of positions that are more likely to be 
potentially problematic.
    Paragraph (b) sets forth definitions of the terms used in this 
section. Proposed paragraph (b)(1) defines ``agency designee'' by 
reference to the definition provided in 5 CFR 2635.102(b) of the OGE 
Standards. Paragraph (b)(2) defines ``employment'' to include non-
Federal employment or a business relationship involving the provision 
of personal services, whether or not for compensation. The definition 
excludes participation in outside activities with the types of 
nonprofit organizations that VA deems unlikely to be problematic, 
unless such participation involves the provision of professional 
services (compensated or not) or advice for compensation or actual 
expenses. Paragraph (b)(3) defines ``prohibited source'' in the same 
terms as that found in 5 CFR 2635.203(d) of the OGE Standards. 
Paragraph (b)(4) defines ``Veteran Service Organization'' to be an 
organization that is recognized by the Secretary of Veteran Affairs for 
the representation of Veterans under 38 U.S.C. 5902. Paragraph (b)(5) 
defines ``Veteran-centric organization'' broadly to be any organization 
with a stated purpose of providing services or assistance to Veterans 
or their families, or of soliciting donations for veterans or their 
families.
    Paragraph (c) sets out the procedures for requesting prior approval 
to engage in covered outside employment or activities. Pursuant to 
these procedures, employees must make a written request directed to 
their supervisor no later than fourteen (14) calendar days before 
beginning the activity. The employee's supervisor is required to 
provide a statement addressing the extent to which the employee's 
duties are related to the proposed outside activity and forward both 
the request and the supervisor's statement to an agency designee for a 
determination on the request.
    Paragraph (d) sets out the standard to be applied by the agency 
designee in acting on requests for prior approval of outside employment 
as broadly defined by paragraph (b)(2) and for prior approval of 
outside activities with Veteran-centric organizations as broadly 
defined by paragraph (b)(5). Approval will be granted unless it is 
determined that the outside employment or other activity is expected to 
involve conduct prohibited by statute or Federal regulation, including 
5 CFR part 2635.
    Under paragraph (e), the DAEO may issue instructions or internal 
directives governing the submission of requests for approval of outside 
employment and may exempt categories of employment from the prior 
approval requirement of this section based on a determination that the 
employment within those categories generally would be approved and is 
not likely to involve prohibited conduct or create an appearance of 
lack of impartiality. The DAEO may also in these instructions establish 
a grace period for new employees to file a request for approval.
    Paragraph (f) provides that within 14 calendar days of a 
significant change in the nature or scope of the outside employment or 
activity or in the employee's official Department position or duties, 
the employee must submit a revised request for approval. Employment 
that began before the effective date of this part is also subject to 
this requirement.

Proposed Section 10501.103 Additional Rules for Attorneys in the Office 
of the General Counsel

    Paragraph (a) requires OGC attorneys to obtain prior written 
approval before engaging in the ``outside practice of law,'' 
compensated or not, as it is defined in that paragraph. OGC attorneys 
must obtain the approval in accordance with the procedures in Sec.  
10501.102(c) and the standard for approval in paragraph (b).
    Paragraph (b) sets out the standard to be applied in reviewing 
requests for prior approval for the outside practice of law. Approval 
will be granted unless it is determined that the outside practice of 
law is expected to involve conduct prohibited by statute, Federal 
regulations, including the OGE Standards, or paragraph (c) of this 
section. This standard is consistent with

[[Page 37802]]

the standard of approval in proposed Sec.  10501.102(d).
    Paragraph (c)(1) prohibits OGC attorneys from engaging in the 
outside practice of law where the activity, in fact or in appearance, 
may require the assertion of a legal position that conflicts with the 
interests of the Department. OGC attorneys are also prohibited from 
engaging in any outside law practice that might require the 
interpretation of a statute, regulation, or rule administered or issued 
by the Department. Attorneys in OGC are also prohibited from engaging 
in any outside practice of law where a supervisory attorney determines 
that such outside practice of law would conflict with the employee's 
official duties or create the appearance of a loss of the attorney's 
impartiality as prohibited by 5 CFR 2635.802. Further, as prohibited by 
18 U.S.C. 205, OGC attorneys may not act as an agent or attorney in any 
matter in which the U.S. Government is a party or has a direct and 
substantial interest. Paragraph (c)(2) enunciates certain exceptions 
from the prohibitions listed in paragraph (c)(1). Paragraph (c)(3) 
outlines the procedures for the use of those exceptions.

Asserting Contrary Legal Positions

    Paragraph (c)(1)(i) is consistent with the rules of professional 
conduct governing the attorney-client relationship. Precluding any 
outside law practice that may require the assertion of legal positions 
adverse to VA derives from the unique and sensitive relationship 
between an attorney and a client, which for an OGC attorney is VA.
    Moreover, the Department has a legitimate interest in maintaining 
the consistency and credibility of the Department's positions before 
the Federal courts. For the most part, the representational bans 
contained in 18 U.S.C. 203 and 205 would preclude outside practice by 
OGC attorneys in the Federal courts because nondiversity cases within 
Federal court jurisdiction generally involve controversies in which the 
United States is a party or has a direct and substantial interest. 
However, cases may arise involving the interpretation or application of 
Federal statutes or regulations that do not necessarily implicate the 
direct and substantial interests of the United States.
    Although very unlikely, OGC attorneys representing private clients 
might appear in front of the same judges before whom they appear in 
their official capacities and argue different interpretations of 
Federal statutes or regulations. Depending upon the visibility of the 
issues and any attendant controversy, asserting conflicting legal 
positions may diminish the persuasiveness of the advocate, erode 
judicial confidence in the integrity of the Department's attorneys, and 
undermine the credibility of both clients. Section 10501.103(c)(1)(i) 
is intended, therefore, to safeguard the interests of the Department as 
the primary client to which the attorney employee owes a professional 
responsibility.

Interpreting Department of Veterans Affairs Statutes

    Paragraph (c)(1)(ii) is intended to effectuate the prohibition on 
the use of public office for private gain, to preclude inconsistent 
legal positions on core issues affecting the interests of VA, and to 
protect the public interest by preventing any public perception that an 
attorney's employment with VA signifies extraordinary competency on 
agency related issues, or that an OGC attorney's interpretation 
implicitly is sanctioned or approved by VA. For the most part, the 
outside practice of law involving agency statutes, rules, or 
regulations would be precluded as a conflicting activity. If the 
subject matter of proposed representation and the assigned duties of 
the attorney correlate, the outside activity potentially would require, 
under the standards set forth in 5 CFR 2635.402 and 2635.502, the 
employee's disqualification from matters so central or critical to the 
performance of the employee's official duties that the employee's 
ability to perform the duties of the employee's position would be 
materially impaired. Similarly, representation on matters involving the 
application of agency statutes may implicate direct and substantial 
interests of the United States, thus contravening the representational 
bans in 18 U.S.C. 203 and 205.
    Paragraph (c)(1)(ii) reaches situations not specifically addressed 
in proposed Sec.  10501.102, although the regulation to some extent 
covers areas that would be subject to those requirements. Absent the 
prohibition contained in this section, an OGC attorney conceivably 
could obtain outside employment advising, as opposed to representing, a 
private client on areas of agency law to which the attorney is not 
assigned. In these circumstances, there is considerable risk that the 
outside legal employment position held by the individual may convey an 
impression of authoritativeness or access to non-public information or 
agency experts that may not necessarily be warranted. Moreover, private 
clients, and those aware of the OGC attorney's involvement, may assume 
incorrectly that the attorney's interpretation is effectively a VA 
interpretation as well. Rendering legal services that may require the 
interpretation of any statute, regulation, or rule administered or 
issued by VA creates an appearance that the employee has used the 
employee's official position to obtain an outside business opportunity. 
Further, if counsel were engaged in the outside law practice that 
involved Department statutes, the potential risk for asserting legal 
positions adverse to the interests of the Department would be 
heightened. Similarly, as established at 5 CFR 2635.802(b), it would 
undermine the effectiveness of the attorney and the attorney's duty of 
loyalty to the Department where an employee's supervisory attorney has 
determined that the outside practice of law would create a conflict of 
interest, or the appearance of a loss of impartiality, requiring the 
attorney's Department disqualification from matters central to the 
attorney's performance of official duties. In such situations, the 
attorney's duty of loyalty to the Department as the attorney's primary 
client must take first priority.

Acting as an Agent

    Paragraph (c)(1)(iii) highlights the proscription in 18 U.S.C. 205 
barring employees from acting as an agent or attorney in any matter in 
which the United States Government is a party or where the Government 
has a direct and substantial interest.

Exceptions

    Paragraph (c)(2) provides exceptions to the prohibitions set forth 
in paragraph (c)(1). Consistent with the exceptions to the 
representational bans contained in 18 U.S.C. 203 and 205, nothing in 
this regulation precludes representation, if approved in advance by the 
appropriate official or supervisor, that is: (1) rendered, with or 
without compensation, to specified relatives or an estate for which an 
employee serves as a fiduciary; (2) provided, without compensation, to 
an employee subject to disciplinary, loyalty, or other personnel 
administration proceedings; or (3) rendered, without compensation to a 
voluntary employee nonprofit organization or group (such as child care 
centers, recreational associations, professional organizations, credit 
unions or other similar groups) before the U.S. Government under 
certain circumstances (18 U.S.C. 205 restricts employees from 
representing an employee organization or group in claims against the 
Government, in seeking grants, contracts or funds from

[[Page 37803]]

the Government, or in a judicial or administrative proceeding where the 
organization or group is a party). Moreover, paragraph (c)(2)(iv) makes 
explicit that neither the ban on asserting contrary positions nor the 
prohibition on interpreting agency statutes is intended to proscribe 
the giving of testimony under oath. In order to take advantage of the 
exceptions to 18 U.S.C. 203 and 205 for representing family members or 
an estate, both statutes expressly require the approval of the 
Government official responsible for the employee's appointment. See 18 
U.S.C. 203(d) and 205(e). To take advantage of the other exceptions set 
forth in paragraph (c)(2), the employee's supervisor must determine 
that the representations are not ``inconsistent with the faithful 
performance of [the employee's] duties.'' See 18 U.S.C. 205(d). These 
approval procedures are detailed in paragraph (c)(3).
Pro Bono
    Paragraph (d) permits attorneys in OGC, subject to the restrictions 
in paragraph (c)(2), to provide outside pro bono legal services through 
a non-profit organization, without obtaining prior written approval. 
For example, VA attorneys may provide legal services pro bono publico 
in areas such as drafting wills or powers of attorney, assisting the 
preparation of domestic violence protective orders, and landlord-tenant 
disputes. These pro bono activities can generally be undertaken without 
detriment to the Department's interests, provided that the employee 
adheres to the limitations of this rule. The Department encourages such 
volunteer legal activities, if not inconsistent with this supplemental 
regulation and the laws and regulations described above. Attorneys in 
the OGC who have questions about whether a specific pro bono legal 
service would comply with the limitations of this rule are encouraged 
to seek advance guidance from the Office of General Counsel's Ethics 
Specialty Team.

III. Matters of Regulatory Procedure

Executive Orders 12866, 13563 and 14094

    Executive Order 12866 (Regulatory Planning and Review) directs 
agencies to assess the costs and benefits of available regulatory 
alternatives and, when regulation is necessary, to select regulatory 
approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, and other advantages; 
distributive impacts; and equity). Executive Order 13563 (Improving 
Regulation and Regulatory Review) emphasizes the importance of 
quantifying both costs and benefits, reducing costs, harmonizing rules, 
and promoting flexibility. Executive Order 14094 (Executive Order on 
Modernizing Regulatory Review) supplements and reaffirms the 
principles, structures, and definitions governing contemporary 
regulatory review established in Executive Order 12866 of September 30, 
1993 (Regulatory Planning and Review), and Executive Order 13563 of 
January 18, 2011 (Improving Regulation and Regulatory Review). The 
Office of Information and Regulatory Affairs has determined that this 
rule is not a significant regulatory action under Executive Order 
12866, as amended by Executive Order 14094. The Regulatory Impact 
Analysis associated with this rulemaking can be found as a supporting 
document at www.regulations.gov.
Regulatory Flexibility Act
    The Secretary hereby certifies that this proposed rule will not 
have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act (5 
U.S.C. 601-612). The provisions in this proposed rule apply to internal 
matters of the agency, its employees and do not involve entities 
outside of VA. This rule will have no impact on small entities. 
Therefore, pursuant to 5 U.S.C. 605(b), the initial and final 
regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do 
not apply.
Unfunded Mandates
    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This proposed rule will have no such effect 
on State, local, and tribal governments, or on the private sector.
Paperwork Reduction Act
    This proposed rule contains no provisions constituting a collection 
of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3521).

List of Subjects in 5 CFR Part 10501

    Conflict of interests, Government employees.

Signing Authority

    Denis McDonough, Secretary of Veterans Affairs, approved this 
document on May 16, 2023, and authorized the undersigned to sign and 
submit the document to the Office of the Federal Register for 
publication electronically as an official document of the Department of 
Veterans Affairs.

Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy & Management, Office of 
General Counsel, Department of Veterans Affairs.
Emory Rounds,
Director, U.S. Office of Government Ethics.

    For the reasons set forth in the preamble, the Department of 
Veterans Affairs, with the concurrence of the Office of Government 
Ethics, proposes to amend title 5 of the Code of Federal Regulations by 
adding a new chapter CV, consisting of part 10501, to read as follows:

TITLE 5--ADMINISTRATIVE PERSONNEL

CHAPTER CV--DEPARTMENT OF VETERANS AFFAIRS

PART 10501--SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES 
OF THE DEPARTMENT OF VETERANS AFFAIRS

Sec.
10501.101 General.
10501.102 Prior approval for certain outside employment and other 
outside activities.
10501.103 Additional rules for attorneys in the Office of the 
General Counsel.

    Authority: 5 U.S.C. 7301, 7353; 5 U.S.C. Ch. 131; 38 U.S.C. 501; 
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; 5 CFR 2635.105, 
5 CFR 2635.402(c), 5 CFR 2635.403(a), 5 CFR 2635.502, CFR 2635.604, 
2635.802, 2635.803; 5 CFR 301; 5 CFR 512.


Sec.  10501.101  General.

    In accordance with 5 CFR 2635.105, the regulations in this part 
apply to employees of the Department of Veterans Affairs (VA) and 
supplement the Standards of Ethical Conduct for Employees of the 
Executive Branch contained in 5 CFR part 2635.


Sec.  10501.102  Prior approval for certain outside employment and 
other outside activities.

    (a) Prior approval requirement. Except as provided in paragraph (e) 
of this section, an employee, other than a special Government employee, 
must obtain written approval prior to:
    (i) Engaging, with or without compensation, in outside employment 
with a prohibited source;

[[Page 37804]]

    (ii) Serving, with or without compensation, as an officer, 
director, trustee, general partner, employee, consultant, or contractor 
for a Veteran-centric organization, such as a Veteran Service 
Organization or other organization, business, corporation, or charity 
with a mission focused on Veterans.
    (b) Definitions. For purposes of this section:
    (1) Agency designee has the meaning set forth in 5 CFR 2635.102(b).
    (2) Employment means any form of non-Federal employment or business 
relationship involving the provision of personal services by the 
employee, including self-employed business activities, whether or not 
for compensation. It includes but is not limited to personal services 
as an officer, director, employee, agent, attorney, consultant, 
contractor, general partner, trustee, teacher, or speaker. It includes 
writing done under an arrangement with another person for production or 
publication of the written product. It does not, however, include 
participation in the activities of a nonprofit charitable, religious, 
professional, social, fraternal, educational, recreational, public 
service, or civic organization, unless the participation involves the 
provision of professional services (compensated or not) or advice for 
compensation other than reimbursement for actual expenses.
    (3) Prohibited source has the meaning described in 5 CFR 
2635.203(d), and includes any person who:
    (i) Is seeking official action by VA;
    (ii) Does business or seeks to do business with VA;
    (iii) Conducts activities regulated by VA;
    (iv) Has interests that may be substantially affected by 
performance or nonperformance of the employee's official duties; or
    (v) Is an organization a majority of whose members are described in 
paragraphs (b)(3)(i) through (iv) of this section.
    (4) Veteran Service Organization means an organization recognized 
by the Secretary of Veterans Affairs for the representation of Veterans 
under 38 U.S.C. 5902.
    (5) Veteran-centric organization means an organization with a 
stated purpose of providing services or assistance to Veterans or their 
families, or of soliciting donations for Veterans or their families, as 
indicated by that organization's website, mission statement, charter, 
or other written material available to the public.
    (c) Submission of requests for approval. An employee seeking to 
engage in any activity for which advance approval is required under 
paragraph (a) of this section must make a written request for approval 
no later than fourteen (14) calendar days before beginning the 
activity. The request shall be directed to the employee's supervisor. 
The supervisor shall submit the request and a statement addressing the 
extent to which the employee's duties are related to the proposed 
outside activity to an agency designee who shall make a final 
determination on the request. The agency designee may consult with an 
Office of General Counsel ethics attorney in making that determination.
    (d) Standard for approval. Approval shall be granted unless it is 
determined that the outside employment or other outside activity is 
expected to involve conduct prohibited by statute or Federal 
regulation, including 5 CFR part 2635.

    Note 1 to paragraph (d): The granting of approval for an outside 
activity does not relieve the employee of the obligation to abide by 
all applicable laws and regulations governing employee conduct, nor 
does approval constitute a sanction of any violation of any 
applicable law or regulation. Approval involves an assessment that 
the general activity as described on the submission does not appear 
likely to violate any criminal statutes or other ethics rules. 
Employees are reminded that during the course of an otherwise 
approvable activity, situations may arise, or actions may be 
contemplated, that, nevertheless, pose ethical concerns. Employees 
are encouraged to contact VA ethics officials for advice.

    (e) Issuance of instructions. The designated agency ethics official 
(DAEO) may issue written instructions regarding the form, content, and 
manner of submission of requests under paragraph (c) of this section. 
The DAEO may include in these instructions examples of outside 
employment that are permissible or impermissible consistent with this 
part and 5 CFR 2635. The instructions also may establish a grace period 
for new employees to file a request for approval. The instructions may 
exempt categories of employment from the prior approval requirement of 
paragraph (a) of this section based on a determination by the DAEO that 
employment within those categories of employment will generally be 
approved and is not likely to involve conduct prohibited by Federal law 
or regulation, including 5 CFR part 2635 and this part.
    (f) Requirement to submit revised request. Upon a significant 
change in either the nature of the outside employment or activity or in 
the employee's official Department position or duties, the employee 
must, within fourteen (14) calendar days of the change, submit a 
revised request for approval using the procedure in paragraph (c) of 
this section. An employee, other than a special Government employee, 
who is engaged in outside employment or an outside activity described 
in paragraph (a) of this section that began before the effective date 
of this part is subject to this requirement.


Sec.  10501.103  Additional rules for attorneys in the Office of the 
General Counsel.

    (a) Additional rules for attorneys in the Office of the General 
Counsel regarding the outside practice of law. Any attorney serving 
within the Office of the General Counsel shall obtain written approval, 
in accordance with the procedures set forth in Sec.  10501.102(c) and 
the standard for approval set forth in paragraph (b) of this section, 
before engaging in the outside practice of law, whether compensated or 
not. For purposes of this section the ``outside practice of law'' means 
those activities requiring professional licensure by a state bar as an 
attorney and include, but are not limited to, providing legal advice to 
a client, drafting legal documents, and representing clients in legal 
negotiations or litigation.
    (b) Standard for approval. Approval shall be granted by the agency 
designee unless it is determined that the outside practice of law is 
expected to involve conduct prohibited by statute or Federal 
regulation, including 5 CFR part 2635, or paragraph (c) of this 
section.
    (c) Prohibited outside practice of law applicable to attorneys in 
the Office of the General Counsel.
    (1) General prohibitions. An employee who serves as an attorney 
within the Office of the General Counsel shall not engage in any 
outside practice of law that might require the attorney to:
    (i) Assert a legal position that is or appears to be in conflict 
with the interests of the Department of Veterans Affairs, the client to 
which the attorney owes a professional responsibility; or
    (ii) Interpret any statute, regulation, or rule administered or 
issued by the Department of Veterans Affairs, or where a supervisory 
attorney determines that the outside practice of law would conflict 
with the employee's official duties or create the appearance of a loss 
of the attorney's impartiality, as prohibited by 5 CFR 2635.802; or
    (iii) Act as an agent or attorney in any matter in which the U.S. 
Government is a party or has a direct and substantial interest, as 
prohibited by 18 U.S.C. 205.
    (2) Exceptions. Nothing in paragraph (c)(1) of this section 
prevents an

[[Page 37805]]

attorney in the Office of the General Counsel from:
    (i) Acting, with or without compensation, as an agent or attorney 
for, or otherwise representing, the employee's parents, spouse, child, 
or any other person for whom, or for any estate for which, the employee 
is serving as guardian, executor, administrator, trustee, or other 
personal fiduciary to the extent permitted by 18 U.S.C. 203(d) and 
205(e), or from providing advice or counsel to such persons or estates; 
or
    (ii) Acting, without compensation, as an agent or attorney for, or 
otherwise representing, any person who is the subject of disciplinary, 
loyalty, or other personnel administration proceedings in connection 
with those proceedings, or from providing uncompensated advice and 
counsel to such person to the extent permitted by 18 U.S.C. 205; or
    (iii) Acting, without compensation, as an agent or attorney for, or 
otherwise representing any cooperative, voluntary, professional, 
recreational, or similar organization or group not established or 
operated for profit, if a majority of the organization's or group's 
members are current employees of the United States or the District of 
Columbia, or their spouses or dependent children. As limited by 18 
U.S.C. 205(d), this exception is not permitted for any representation 
with respect to a matter which involves prosecuting a claim against the 
United States under 18 U.S.C. 205(a)(1) or 18 U.S.C. 205(b)(1), or 
involves a judicial or administrative proceeding where the organization 
or group is a party, or involves a grant, contract, or other agreement 
providing for the disbursement of Federal funds to the organization or 
group; or
    (iv) Giving testimony under oath or from making statements required 
to be made under penalty for perjury or contempt.
    (3) Specific approval procedures for paragraph (c)(2) of this 
section.
    (i) The exceptions to 18 U.S.C. 203 and 205 described in paragraph 
(c)(2)(i) of this section do not apply unless the employee obtained the 
prior approval of the Government official responsible for the 
appointment of the employee to a Federal position.
    (ii) The exceptions to 18 U.S.C. 205 described in paragraphs 
(c)(2)(ii) and (iii) of this section do not apply unless the employee 
has obtained the prior approval of a supervisory official who has 
authority to determine whether the employee's proposed representation 
is consistent with the faithful performance of the employee's duties.
    (d) Pro Bono activity. Subject to compliance with paragraph (c) of 
this section, attorneys within the Office of the General Counsel are 
permitted to provide outside pro bono legal services (without 
compensation other than reimbursement of expenses) to organizations or 
individuals through a non-profit organization, without obtaining prior 
written approval in accordance with the procedures set forth in Sec.  
10501.102(c).

[FR Doc. 2023-11772 Filed 6-8-23; 8:45 am]
BILLING CODE 8320-01-P