Chapter 02. Exception to Financial Interest Prohibition
Regulation .01 Scope.LinkCopy Citation
A.
Except as provided in §B of this regulation, this chapter applies to all officials and employees.
B.
This chapter does not apply to a member of the General Assembly or a State official in the Judicial Branch.
Regulation .02 Prohibition Against Holding of Private Financial Interests.LinkCopy Citation
Except as provided in Regulation .03 of this chapter, an official or employee may not hold a financial interest in an entity that:
A.
Is subject to the authority of:
(1)
The official or employee; or
(2)
The government unit with which the official or employee is affiliated; or
B.
Is negotiating or has entered a contract with the governmental unit with which the official or employee is affiliated.
Regulation .03 Exceptions.LinkCopy Citation
Subject to Regulation .04 of this chapter, the Commission may grant an official or employee an exception to Regulation .02 of this chapter for a specific financial interest if:
A.
The interest is disclosed as provided in Regulation .05 of this chapter;
B.
The employee’s or official's State duties do not significantly impact on the entity in which the financial interest is held, or on a contract or proposed contract between the entity and the official’s or employee’s governmental unit;
C.
The employee or official is not directly supervised by a person who has duties that significantly impact on the entity in which the financial interest is held, or on the contract or proposed contract;
D.
The official or employee does not supervise a person who has duties that significantly impact on the entity in which the financial interest is held, or on the contract or proposed contract;
E.
The employee or official is not affiliated with the specific unit within the employee’s or official’s governmental unit that exercises authority over the entity in which the financial interest is held, or is involved in contracts with the entity;
F.
The employee or official has complied with relevant other sections of the Ethics Law relating to the matters involved;
G.
The employee’s or official's financial interest in the entity involves no substantive non-ministerial duties significantly relating to the employee’s or official’s governmental unit’s authority over the entity;
H.
The employee’s or official's financial interest in the entity does not involve negotiating or carrying out a contract involving the entity and the employee’s or official’s governmental unit, other than contracts involving broad reimbursement payments that are based on a generally applicable standard and that do not involve substantial negotiation or discretion;
I.
State contract or contracts do not exceed 20 percent of the calendar year gross income of the entity in which the financial interest is held, one-third of the capitalized value of the entity, or a value at any time during a calendar year of $5,000 or more; and
J.
The Commission determines that the employee’s or official's financial interest and the circumstances do not otherwise raise a conflict of interest or appearance of conflict as contemplated by General Provisions Article, §§5-102 and 5-502, Annotated Code of Maryland.
Regulation .04 Application of Exceptions.LinkCopy Citation
A.
Exceptions Under Limited Circumstances.
(1)
The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03C, D, E, G, or I of this chapter for a specific financial interest if:
(a)
The head of the official’s or employee’s governmental unit advises the Commission that the head of the governmental unit does not believe that the financial interest would present a conflict of interest or the appearance of a conflict of interest that would impair the credibility of the governmental unit; and
(b)
The Commission concurs in the assessment of the head of the official’s or employee’s governmental unit provided under §A(1)(a) of this regulation.
(2)
The Commission may grant an exception under Regulation .03 of this chapter to an individual who does not meet the criteria of Regulation .03A(1) of this chapter for a specific financial interest in an entity if:
(a)
The employee or official did not know or have reason to know that the entity is under the authority of the employee or official or of the employee’s or official’s governmental unit;
(b)
The employee or official did not know or have reason to know that the entity has or is negotiating a contract with the employee’s or official’s governmental unit;
(c)
The entity is not included on any list of entities doing business with the employee’s or official’s governmental unit that is provided by the Commission or is available through the Commission’s website; and
(d)
Upon obtaining knowledge of the relationship between the entity and the employee’s or official’s governmental unit, the employee disclosed the financial interest as provided in Regulation .05 of this chapter.
B.
The Commission may grant an exception under Regulation .03 of this chapter to an employee who does not meet the criteria of Regulation .03G or H of this chapter for a specific financial interest if:
(1)
The employee has limited duties that are defined with sufficient precision regarding time, mode, and occasion that the employee may not exercise substantial discretion or judgment;
(2)
The head of the employee’s governmental unit advises the Commission that the head of the agency:
(a)
Believes that the service or product to be supplied by the employee would otherwise be unavailable to the State; and
(b)
Does not believe that the financial interest would present a conflict of interest or the appearance of a conflict that would impair the credibility of the governmental unit; and
(3)
The Commission concurs in the assessment of the head of the employee’s governmental unit provided under §B(2) of this regulation.
Regulation .05 Disclosure Requirements.LinkCopy Citation
A.
An employee or official shall disclose a financial interest prohibited under Regulation .02 of this chapter:
(1)
For an official or employee required to file a financial disclosure statement under General Provisions Article, §5-601, Annotated Code of Maryland, on the financial disclosure statement for the reporting period in which the official or employee held the financial interest;
(2)
If the official or employee knows or has reason to know that the entity is subject to the authority of the official or employee, subject to the authority of the official’s or employee’s governmental unity, or is negotiating or has entered a contract with the official’s or employee’s governmental unit, on the form provided by the Ethics Commission for an official or employee who:
(a)
Is not required to file a financial disclosure statement under General Provisions Article, §5-601, Annotated Code of Maryland; or
(b)
Did not hold the financial interest during the reporting period covered by the most recent financial disclosure statement filed under General Provisions Article, §5-601, Annotated Code of Maryland.
B.
An official or employee shall file a form required by §A(2) of this regulation with the Commission on or before the latter of:
(1)
Acquiring the financial interest; or
(2)
Acquiring knowledge that or reason to have knowledge that the entity:
(a)
Is subject to the authority of the official or employee or the government unit with which the official or employee is affiliated; or
(b)
Is negotiating or has entered a contract with the governmental unit with which the official or employee is affiliated.
C.
An official or employee has reason to know that an entity does business with the official’s or employee’s governmental unit if the entity is listed as doing business with the official’s or employee’s governmental unit that is provided by the Commission or is available on the Commission’s website.
Chapter annotations
Authority: General Provisions Article, §§5-206 and 5-502, Annotated Code of Maryland
History: Effective date: January 31, 1983 (10:2 Md. R. 111)
History: Regulation .01 amended effective January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)
History: Regulation .02 amended effective October 15, 2012 (39:20 Md. R. 1308)
History: Regulation .03 amended effective October 15, 2012 (39:20 Md. R. 1308)
History: Regulation .04 amended effective January 13, 1986 (13:1 Md. R. 19); October 15, 2012 (39:20 Md. R. 1308)
History: Regulation .05 amended effective October 15, 2012 (39:20 Md. R. 1308)