# 3.1101 Definitions.

As used in this subpart-

“Acquisition function closely associated with inherently governmental functions” means supporting or providing advice or recommendations with regard to the following activities of a Federal agency:

1. 1. (1) Planning acquisitions.

   2. (2) Determining what supplies or services are to be acquired by the Government, including developing statements of work.

   3. (3) Developing or approving any contractual documents, to include documents defining requirements, incentive plans, and evaluation criteria.

   4. (4) Evaluating contract proposals.

   5. (5) Awarding Government contracts.

   6. (6) Administering contracts (including ordering changes or giving technical direction in contract performance or contract quantities, evaluating contractor performance, and accepting or rejecting contractor products or services).

   7. (7) Terminating contracts.

   8. (8) Determining whether contract costs are reasonable, allocable, and allowable.

   (a) “Covered employee” means an individual who performs an acquisition function closely associated with inherently governmental functions and is-

   1. (1) An employee of the contractor; or

   2. (2) A subcontractor that is a self-employed individual treated as a covered employee of the contractor because there is no employer to whom such an individual could submit the required disclosures.

   “Personal conflict of interest” means a situation in which a covered employee has a financial interest, personal activity, or relationship that could impair the employee’s ability to act impartially and in the best interest of the Government when performing under the contract. (A de minimis interest that would not “impair the employee’s ability to act impartially and in the best interest of the Government” is not covered under this definition.)

   1. (1) An employee of the contractor; or

   2. (2) A subcontractor that is a self-employed individual treated as a covered employee of the contractor because there is no employer to whom such an individual could submit the required disclosures.

   “Personal conflict of interest” means a situation in which a covered employee has a financial interest, personal activity, or relationship that could impair the employee’s ability to act impartially and in the best interest of the Government when performing under the contract. (A de minimis interest that would not “impair the employee’s ability to act impartially and in the best interest of the Government” is not covered under this definition.)

   1. (1) Among the sources of personal conflicts of interest are-

      1. (i) Financial interests of the covered employee, of close family members, or of other members of the covered employee's household;

      2. (ii) Other employment or financial relationships (including seeking or negotiating for prospective employment or business); and

      3. (iii) Gifts, including travel.

   2. (2) For example, financial interests referred to in paragraph (1) of this definition may arise from-

      1. (i) Compensation, including wages, salaries, commissions, professional fees, or fees for business referrals;

      2. (ii) Consulting relationships (including commercial and professional consulting and service arrangements, scientific and technical advisory board memberships, or serving as an expert witness in litigation);

      3. (iii) Services provided in exchange for honorariums or travel expense reimbursements;

      4. (iv) Research funding or other forms of research support;

      5. (v) Investment in the form of stock or bond ownership or partnership interest (excluding diversified mutual fund investments);

      6. (vi) Real estate investments;

      7. (vii) Patents, copyrights, and other intellectual property interests; or

      8. (viii) Business ownership and investment interests.