(3) By donation to a governmental or charitable organization for use as animal feed or for other nonfood use.

(4) If the commodity is unfit for any use, or if disposal in accordance with subparagraph (1), (2), or (3) of this paragraph, is not possible, the commodity shall be destroyed, under the observation of a representative of USAID or a Diplomatic Post if practicable, in such manner as to prevent its use for any purpose. Expenses incidental to the handling and disposition of the damaged commodity shall be paid by the cooperating sponsor unless it is determined by the USAID or the Diplomatic Post that the damage could not have been prevented by the proper exercise of the cooperating sponsor's responsibility under the terms of the Transfer Authorization. Actual expenses incurred in effecting any sale may be deducted from the sales proceeds and the net proceeds shall be deposited with the U.S. Disbursing Officer, American Embassy, with instructions to credit the deposit to Account No. 20 FT 401. The cooperating sponsor shall promptly furnish USAID or the Diplomatic Post a written report of all circumstances relating to the loss and damage and shall include in this report, or a supplemental report, a certification by a public health official or other competent authority of the exact quantity of the damaged commodity disposed of because it was determined to be unfit for human consumption.

(b) Prior to delivery to cooperating sponsor at port of entry. If the commodity is damaged prior to delivery to the cooperating sponsor the USAID or Diplomatic Post shall immediately arrange for inspection by a public health official or other competent authority. If the commodity is determined to be unfit for human consumption it shall be disposed of in accordance with the priority set forth in paragraph (a) of this section. Expenses incidental to the handling and disposition of the damaged commodity shall be paid by USAID or the Diplomatic Post from the sales proceeds, from CCC Account No. 20 FT 401

or from special Title II, P.L. 480 Agricultural Commodity Account. The net proceeds or sales shall be deposited with the USDO for the credit of CCC account No. 20 FT 401.

§ 211.9 Termination of program.

All or any part of the assistance provided under the program, including commodities in transit may be terminated by AID at its discretion if the cooperating sponsor fails to comply with the provisions of the transfer authorization or this part, or if it is determined that because of changed conditions the continuation of such assistance is unnecessary or undesirable. Under such circumstances title to commodities which have been transferred to the cooperating sponsor shall at the written request of USAID, the Diplomatic Post, or AID/W, be retransferred to the U.S. Government by the cooperating sponsor. Any excess commodities on hand at the time the program is terminated shall be disposed of in accordance with § 211.6 (m). If it is determined that any commodity to be supplied under the Transfer Authorization is no longer available for P.L. 480, Title II programs, such authorization shall terminate with respect to any commodities which, as of the date of such determination have not been delivered f.o.b. or f.a.s. vessel.

AID may waive, withdraw, or amend, at any time, any or all of the provisions of this Part 211. Any cooperating sponsor which has failed to comply with the provisions of this part or any instructions or procedures issued in connection herewith, or any agreements entered into pursuant hereto may at the discretion of AID be suspended or disqualified from further participation in any distribution program. Reinstatement may be made at the option of AID. Disqualification shall not prevent AID from taking other action through other available means when considered necessary.

(a) Four years ago, in issuing Peace Corps Standards of Employee Conduct, Sargent Shriver said:

Following the letter of the law or staying within the shadow of ethical phrases will not suffice. Our undivided loyalty is owed to our Government. We will be judged by both fact and appearance. There is no place on the Peace Corps' team for those who cannot live comfortably with this high standard.

(b) In Executive Order No. 11222, the President recently directed the Civil Service Commission to require each agency head to review and reissue his agency's regulations regarding the ethical conduct and other responsibilities of all its employees. One of the main purposes of the regulations in this part is to encourage individuals faced with questions involving subjective judgment to seek counsel and guidance. The General Counsel is designated to be the counselor for the Peace Corps with respect to these matters. He and the Deputy General Counsel will give authoritative advice and guidance in this area to any Peace Corps employee who seeks it.

(c) Any violation of the regulations in this part may be cause for disciplinary action. Violation of those provisions of

(a) As provided by the President in Executive Order No. 11222, whether or not specifically prohibited by law or in the regulations in this part, no U.S. regular and special Government employees shall take any action which might result in, or create the appearance of:

(1) Using public office or employment for private gain, whether for themselves or for another person, particularly one with whom they have family, business, or financial ties.

(2) Giving preferential treatment to any person.

(3) Impeding Government efficiency or economy.

(4) Losing complete independence or impartiality.

(5) Making a Government decision outside official channels.

(6) Affecting adversely the confidence of the public in the integrity of the Government.

(7) Using Government office or employment to coerce a person to provide financial benefit to themselves or to other persons, particularly ones with whom they have family, business, or financial ties.

(b) Moreover, no regular or special employee may engage in criminal, infamous, dishonest, immoral, or notoriously disgraceful conduct, or other conduct prejudicial to the Government.

§ 301.735-3 Conflict of interest.

(a) Regular Government employees. A regular employee of the Government is in general subject to the following major criminal prohibitions:

(1) He may not, except in the discharge of his official duties, represent anyone else before a court or Govern

ment agency in a matter in which the United States is a party or has an interest. This prohibition applies both to paid and unpaid representation of another.

(2) He may not participate in his governmental capacity in any matter in which he, his spouse, minor child, outside business associate, or person with whom he is negotiating for employment has a financial interest.

(3) He may not, after his Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and in which he participated personally and substantially for the Government.

(4) He may not, for one year after his Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and which was within the boundaries of his official responsibility during the last year of his Government service. This temporary restraint gives way to the permanent restraint described in subparagraph (3) of this paragraph if the matter is one in which he participated personally and substantially.

(5) He may not receive any salary, or supplementation of his Government salary, from a private source as compensation for his services to the Government.

(b) Special Government employees. A special Government employee is subject to the following major criminal prohibitions:

(1) He may not, except in the discharge of his official duties, represent anyone else before a court or Government agency in a matter in which the United States is a party or has an interest and in which he has at any time participated personally and substantially for the Government.

(2) He may not, except in the discharge of his official duties, represent anyone else in a matter pending before the agency he serves unless he has served there no more than 60 days during the past 365. He is bound by this restraint despite the fact that the matter is not one in which he has ever participated personally and substantially.

The restrictions described in subparagraphs (1) and (2) of this paragraph

apply to both paid and unpaid representation of another.

(3) He may not participate in his governmental capacity in any matter in which he, his spouse, minor child, outside business associate, or person with whom he is negotiating for employment has a financial interest.

(4) He may not, after his Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and in which he participated personally and substantially for the Government.

(5) He may not, for 1 year after his Government employment has ended, represent anyone other than the United States in connection with a matter in which the United States is a party or has an interest and which was within the boundaries of his official responsibility during the last year of his Government service. This temporary restraint gives way to the permanent restriction described in subparagraph (4) of this paragraph if the matter is one in which he participated personally and substantially.

(a) The Hatch Political Activities Act and other statutes regulate the extent to which employees may engage in political activities. Generally, using official authority or influence for the purpose of interfering with an election or its result or taking an active part in political management or in political campaigns is prohibited. These restrictions do not affect the right of employees to express their personal political opinions, as long as they do not do so in such a manner as to take an active part in political campaigns or management or to participate in the activities of national or State political parties to the extent that such participation is not proscribed by law.

(b) Special Government employees are subject to the Hatch Act for the whole of each day on which they do any work for the Government.

(c) While regular employees may explain and support governmental programs that have been enacted into law, in exercising their official responsibilities they should not publicly support or oppose pending legislation, except in testimony before the Congress.

(d) Also, the Foreign Service Act generally prohibits any Foreign Service employee from (1) corresponding in regard to the public affairs of any foreign government, except with the proper officers of the United States, and (2) recommending any person for employment in any position of trust or profit under the government of the country to which he is detailed or assigned.

§ 301.735-5 Gifts.

(a) From donors dealing with Peace Corps. (1) No Peace Corps regular or special employee shall solicit or accept, directly or indirectly, for himself, for any member of his family, or for any person with whom he has business or financial ties, any gift, gratuity, favor, entertainment or loan or any other thing of value, from any individual or organization which:

(i) Has, or is seeking to obtain, contractual or other business or financial relations with the Peace Corps.

(ii) Has interests that may be substantially affected by the performance or nonperformance of the employee's official responsibility.

(iii) Is in any way attempting to affect the employee's exercise of his official responsibility.

(2) Subparagraph (1) of this paragraph does not prohibit, even if the donor has dealings with the Peace Corps.

(i) Acceptance of things of value from parents, children, or spouse if those relationships rather than the business of the donor is the motivating factor for the gift.

(ii) Acceptance of food and refreshments of nominal value on infrequent occasions in the ordinary course of a breakfast, luncheon or dinner meeting or other meeting.

(iii) Solicitation and acceptance of loans from banks or other financial institutions to finance proper and usual activities of employees, such as home mortgage loans, solicited and accepted on customary terms.

(iv) Acceptance on behalf of minor dependents of fellowships, scholarships or educational loans awarded on the basis of merit and/or need.

(v) Acceptance of awards for meritorious public contribution or achievement given by a charitable, religious, professional, social, fraternal, nonprofit

educational and recreational, public service, or civic organization.

(vi) If no Government payment or reimbursement is made, acceptance of bona fide reimbursement for actual expenses for travel and such other necessary subsistence under circumstances otherwise compatible with the regulations in this part and with the laws on conflict of interest. However, an employee may not be reimbursed, and payment may not be made on his behalf, for excessive personal living expenses, gifts, entertainment or other personal benefits.

(3) Regular or special employees need not return unsolicited advertising or promotional material, such as pens, pencils, note pads, calendars and other things of nominal intrinsic value.

(b) From other Peace Corps employees. No employee in a superior official position shall accept any gift presented as a contribution from employees receiving less salary than himself. No employee shall solicit contributions from another employee for a gift to an employee in a superior official position, nor shall any employee make a donation as a gift to an employee in a superior official position.

(c) From foreign governments. No regular employee may solicit or, without the consent of the Congress, receive any present, decoration, emolument, pecuniary favor, office, title or any other gift from any foreign government.

(d) Gifts to Peace Corps. Gifts to the United States or to the Peace Corps may be accepted in accordance with Peace Corps regulations.

(a) Application. Only paragraph (c) of this section is applicable to special Government employees.

(b) General. (1) There is no general prohibition against Peace Corps employees holding outside employment, including teaching, lecturing or writing. But no employee shall engage in such employment if it might result in a conflict or an apparent conflict between the private interests of the employee and his official responsibility.

(2) Thus an employee shall not engage in outside employment or other outside activity not compatible with the full and proper discharge of his official