§988 — Title 10 Armed Forces | U.S. Code

Summary

Certain high-level Department of Defense officials must not buy or own publicly traded stock in any company that was one of the 10 biggest recipients of DoD contract money in a fiscal year during the five previous fiscal years. There are two exceptions: if the official’s combined holdings with their spouse and minor children stay below the de minimis limit in 5 C.F.R. 2640.202(a)(2), or if the stock is held through an Excepted Investment Fund or a mutual fund. A “covered official” means a Presidentially appointed civilian confirmed by the Senate, or—if in a key acquisition job—military officers above O–6 or senior civilian executives (SES, Senior‑Level, or Scientific/Professional). An Excepted Investment Fund is a widely held fund described in section 102(f)(8) of the Ethics in Government Act of 1978 (5 U.S.C. App.).

Title 10, §988

Armed Forces — Source: USLM XML via OLRC

(a)Except as provided in subsection (b), a covered official of the Department of Defense may not own or purchase publicly traded stock of a company if that company is one of the 10 entities awarded the most amount of contract funds by the Department of Defense in a fiscal year during the five preceding fiscal years.

(b)This section shall not apply to the purchase or ownership of a publicly traded stock of a company otherwise described in subsection (a) as follows:

(1)If the aggregate market value of the holdings of the covered official, and the spouse and minor children of the covered official, in the stock of that company, both before and after purchase (in the case of a purchase), does not exceed the de minimis threshold established in section 2640.202(a)(2) of title 5, Code of Federal Regulations.

(2)If the stock is purchased and owned as part of an Excepted Investment Fund or mutual fund.

(c)In this section:

(1)The term “covered official of the Department of Defense” means any of the following:

(A)A civilian appointed to a position in the Department of Defense by the President, by and with the advice and consent of the Senate.

(B)If serving in a key acquisition position (as designated by the Secretary of Defense or the Secretary concerned for purposes of this section), the following:

(i)A member of the armed forces in a grade above O–6.

(ii)A civilian officer or employee in a Senior Executive Service, Senior-Level, or Scientific or Professional position.

(2)The term “Excepted Investment Fund” means a widely-held investment fund described in section 102(f)(8) of the Ethics in Government Act of 1978 (5 U.S.C. App.).11 See References in Text note below.

Notes & Related Subsidiaries

Editorial Notes

References in Text

section 102(f)(8) of the Ethics in Government Act of 1978, referred to in subsec. (c)(2), is section 102(f)(8) of Pub. L. 95–521, which was set out in the Appendix to Title 5, Government Organization and Employees, and was repealed and restated as section 13104(f)(8) of Title 5 by Pub. L. 117–286, §§ 3(c), (7), Dec. 27, 2022, 136 Stat. 4284, 4361.

§988 Prohibition on ownership or trading of stocks in certain companies by certain officials of the Department of Defense

Summary

Title 10, §988

Notes & Related Subsidiaries

Editorial Notes

References in Text

Citations & Metadata