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Rule

Removal of Regulations on Employee Responsibilities and Conduct

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Information about this document as published in the Federal Register.

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AGENCY:

State Department and United States Agency for International Development.

ACTION:

Direct final rule.

SUMMARY:

The Department of State and the United States Agency for International Development (USAID) are removing regulations on employee responsibilities and conduct (22 CFR part 10). Most of these regulations have been superseded or otherwise made unnecessary by Office of Government Ethics or Office of Personnel Management regulations of executive branch-wide applicability. Certain sections of the regulations are based on Foreign Service Act provisions that have been repealed. Some provisions have continuing application and are published, as modified, in the Foreign Affairs Manual and other provisions simply reference other statutory or regulatory provisions. The Department of State and USAID are using direct final rulemaking for this action because it is expected that there will be no significant adverse comment on the rule.

DATES:

This direct final rule is effective on June 3, 2005, without further notice, unless the Department of State and USAID receive adverse comment by May 4, 2005. If adverse comment is received, then the Department of State and USAID will publish a timely withdrawal of the direct final rule in the Federal Register.

ADDRESSES:

You may submit comments, identified by any of the following methods:

  • E-mail: eirinbergjl@state.gov. You must include the RIN in the subject line of your message.
  • Mail (paper, disk, or CD-ROM submissions): Julia L. Eirinberg, Attorney-Adviser, Department of State, Office of the Assistant Legal Adviser for Employment Law, 2201 C Street NW, Suite 5425, Washington, DC 20520.
  • Fax: 202-647-6794.

Persons with access to the internet may also view this notice and provide comments by going to the regulations.gov Web site at: http://www.regulations.gov/​index.cfm.

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FOR FURTHER INFORMATION CONTACT:

Julia L. Eirinberg, Attorney-Adviser, Department of State, Office of the Assistant Legal Adviser for Employment Law, 2201 C Street NW., Suite 5425, Washington DC 20520; e-mail address: eirinbergjl@state.gov.

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SUPPLEMENTARY INFORMATION:

The Department of State and USAID are removing part 10, “Employee Responsibilities and Conduct,” from 22 CFR as a result of developments in the executive branch ethics program and in other areas of law that have occurred since the promulgation of part 10 on May 2, 1978. While the regulations in 22 CFR part 10 also applied to the International Communication Agency (ICA), that agency no longer exists and its functions have been assumed by the Department of State.

Pursuant to the Ethics in Government Act of 1978 (5 U.S.C. App.), as amended, the U.S. Office of Government Ethics (OGE) now provides overall direction and leadership in relation to the executive branch ethics program. In 1989, E.O. 12674 (as modified by E.O. 12731) directed OGE to establish “a single, comprehensive, and clear set of executive-branch standards of conduct” and “a system of nonpublic (confidential) financial disclosure.” On August 7, 1992, OGE published the Standards of Ethical Conduct for Employees of the Executive Branch (Standards), now codified at 5 CFR part 2635. On April 7, 1992, OGE modified its existing financial disclosure regulation, at 5 CFR part 2634, to incorporate a revised system of confidential financial disclosure reporting.

Part 10 of 22 CFR was published in 1978 largely on the basis of a model standards of conduct regulation at old 5 CFR part 735 that had been promulgated by the Office of Personnel Management (OPM) pursuant to Executive Order 11222. The new OGE Standards became effective February 3, 1993. The Standards superseded individual executive agency conduct provisions—like those in 22 CFR part 10—that had been issued on the basis of the model OPM regulation, and superseded much of the model regulation itself. (As discussed below in relation to section 10.735-205 of part 10, certain agency conduct provisions were “grandfathered” or preserved for a few years after the February 3, 1993, effective date.) Provisions in the OGE regulation at 5 CFR part 2634 concerning the revised system of confidential financial disclosure became effective on October 5, 1992, and superseded those portions of individual executive agency regulations pertaining to confidential reporting that had been issued on the basis of the model OPM regulation. Taken together and as discussed more fully below, 5 CFR part 2635 and 5 CFR part 2634 superseded subpart C, subpart D, and much of subparts A and B of part 10. As also discussed below, the remaining sections of subparts A and B have been superseded or supplanted by other OGE regulations, are obsolete, or are unnecessary.

In subpart A of part 10, the statement of purpose in section 10.735-101 has been superseded by corollary sections in 5 CFR part 2635 and 5 CFR part 2634 Start Printed Page 16938and by language in section 101 of E.O. 12674 emphasizing the importance of ethical conduct. The definitions in section 10.735-102 have been superseded by definitions in the OGE regulations or are relevant only in relation to restrictions in volume 3 of the Foreign Affairs Manual and will, in any event, be rendered unnecessary when the rest of part 10 is removed from the CFR. Section 10.735-104 states that part 10 applies to all employees on detail to the Department. This section was important when each agency had its own conduct regulation, but is no longer necessary to the extent that the same basic standards, financial disclosure requirements, and conflict of interest statutes (and implementing regulations) now apply to all executive branch employees. Section 10.735-105 states that a violation of part 10 may be cause for appropriate disciplinary action. This section has been superseded by provisions in the Standards and the financial disclosure regulation, at sections 2635.106 and 2634.701, and by provisions in volume 3 of the Foreign Affairs Manual.

Section 10.735-103 of subpart A requires that the Secretary of State and Administrator of USAID each designate a “Counselor” to provide advice on employee conduct and to coordinate counseling services provided by designated “Deputy Counselors.” This section has been supplanted by procedural and staffing changes made by the Department and USAID consistent with the OGE regulation at 5 CFR part 2638. Part 2638 requires the Secretary and Administrator to each name a “Designated Agency Ethics Official” (DAEO) who, assisted by one or more “Deputy Ethics Officials” and other staff, is responsible for counseling and training and for other aspects of the ethics programs at the respective agencies.

In subpart B of part 10, section 10.735-201 sets forth general principles of conduct from Executive Order 11222. Executive Order 11222 was revoked in 1989 by Executive Order 12674. Similar principles now appear in Executive Order 12674 and are restated in the Standards, at section 2635.101. Section 10.735-201 also highlights provisions in part 10 having some application to a U.S. citizen employee's family. The highlighted provisions have been superseded by the Standards, are now implemented in 22 CFR part 3 (in relation to gifts from foreign governments), or are published, as modified, in volume 3 of the Foreign Affairs Manual (in relation to employees and family members abroad). The application of provisions to family members accompanying employees overseas is treated specifically in the Foreign Affairs Manual because of privileges and immunities attributed to family members by virtue of the official status of employees under international law. In addition, certain provisions in the Standards may affect an employee by virtue of the actions or interests of a family member. See, e.g., 5 CFR 2635.203 (providing that an employee accepts a gift indirectly if it is given with the employee's knowledge and acquiescence to his or her parent, sibling, spouse, child, or dependent relative because of that person's relationship to the employee).

The first paragraphs of section 10.735-202 of part 10 prohibit an employee from accepting gifts from outside sources in certain circumstances, e.g., from persons doing or seeking to do business with his or her agency, but provide for several exceptions. These provisions were superseded by subpart B of the Standards. In addition, section 10.735-202 prohibits an employee from giving a gift to an official superior and from accepting a gift from an employee receiving less pay. These prohibitions derive from 5 U.S.C. 7351 and are now implemented in subpart C of the Standards.

In addition, section 10.735-202 affirms that an employee may accept travel and subsistence expenses in connection with permissible outside activities notwithstanding the gifts prohibitions in part 10, but prohibits “excessive” benefits. The acceptance of gifts, compensation, or travel expenses in connection with outside activities is now addressed in the Standards, in subparts B and H. See also 5 CFR 2636.303 (defining “outside earned income” in relation to the outside compensation restrictions imposed on certain high-level “noncareer” employees by section 102 of E.O. 12674 and by title V of 5 U.S.C. App., as implemented by OGE in section 2635.804 of the Standards and in 5 CFR part 2636). Section 10.735-202 also cites a 1967 Comptroller General opinion, Decision B-128527. The appropriations law principles addressed in this decision are addressed in numerous subsequent legal opinions and are reflected in volume 2 of the Foreign Affairs Manual and in other regulations.

Section 10.735-203 of part 10 briefly summarizes the Foreign Gifts and Decorations Act, at 5 U.S.C. 7342, and references the Department's implementing regulation at 22 CFR part 3. The Foreign Gifts and Decorations Act is summarized in the OGE Standards, e.g., in section 2635.204. Other laws and regulations of significance to the ethics program are similarly summarized or referenced in subparts A through H of the Standards. Separately, subpart I of the Standards lists these significant laws and regulations (including 5 U.S.C. 7342), as well as other laws that establish standards to which an employee's conduct must conform. The subpart I compilation has replaced the listing in section 10.735-216 of part 10. (Even to the extent that a summary or reference in part 10 is not included in the Standards or some other regulation relating to the ethics program, the Department has determined that a summary or reference does not warrant further publication in part 10 absent some additional justification.)

Section 10.735-204 of part 10 prohibits an employee from engaging in an outside activity that conflicts with the employee's official duties and summarizes the Emoluments Clause of the U.S. Constitution and a conflict of interest statute, 18 U.S.C. 209, pertaining to the acceptance of compensation for services to the Government. These provisions have been superseded by the general provisions in subpart H of the Standards pertaining to conflicting outside activities, including the brief summaries in subpart H of the Emoluments Clause and various conflict of interest statutes.

Section 10.735-204 specifically addresses teaching, speaking, and writing pursued as an outside activity. It restricts the use of Government information in connection with the preparation of a person for an examination of the Civil Service Commission (now OPM) or Board of Examiners for the Foreign Service, prohibits certain Presidential appointees from accepting compensation for teaching, speaking, or writing about certain subject matter, and alerts employees to the existence of clearance procedures. The compensation restriction has been superseded by section 2635.807 of the Standards. See also section 102 of E.O. 12674 and title V of 5 U.S.C. App. (imposing “outside earned income” restrictions on certain high-level “noncareer” employees, as implemented in section 2635.804 of the Standards and in 5 CFR part 2636). The restriction pertaining to the use of Government information remains in the residual OPM regulation at 5 CFR part 735. As discussed above, the mere reference in part 10 to the teaching, speaking, and writing clearance procedures, now in volume 3 of the Foreign Affairs Manual, is unnecessary. Start Printed Page 16939

Section 10.735-204 also affirms that an employee may serve a foreign government or international organization of states if serving on behalf of the United States, and that the section does not preclude participation in the activities of political parties or participation in (or awards from) private organizations. While these affirmations remain generally correct, other statutes and regulations address, for example, the detail or transfer of employees to international organizations or to foreign governments. See e.g., 5 U.S.C. 3343; 5 U.S.C. 3581-84; 5 CFR 352.301 et seq.; 22 U.S.C. 2387; 22 U.S.C. 2388. The general permissibility of domestic political activity is implicit in the references, at section 2635.801 and 2635.902 of the Standards, to the “Hatch Act” restrictions. See also 5 CFR 2635.204 (providing that an employee may accept certain gifts in connection with active participation in political management or political campaigns). It is also apparent from subpart H of the Standards that participation in outside organizations is generally permissible, subject to certain restrictions. The acceptance of awards from private organizations is specifically addressed in section 2635.204 of the Standards.

Section 10.735-211 of part 10 requires that an employee make clear that his or her participation in a private organization, in his or her personal capacity, should not be construed as an official endorsement of the organization's viewpoints, but provides that an employee may make use of his or her title for purposes of identification when participating in certain organizations (e.g., civic organizations) and that an employee is generally free to refer to his or her connection with the agency when participating in an employee organization. This portion of section 10.735-211 has been superseded by section 2635.702 of the Standards.

Section 10.735-211 specifically addresses employee participation, in a personal capacity, in private organizations concerned with foreign policy. Unless approved by specified officials at the Department or USAID, an employee “may not serve as advisor, officer, director, teacher, sponsor, committee chairman, or in any other official capacity or permit the employee's name to be used on a letterhead, in a publication, in an announcement or news story, or at a public meeting * * *” and “senior officers” are limited to mere membership. These limitations have been superseded by the more general outside activities provisions in subpart H of the Standards and by the restriction at 5 CFR 2635.702 pertaining to the use of official title. Moreover, an employee's participation in an outside organization must be consistent with certain conflict of interest statutes and with the impartiality standard as implemented in 5 CFR 2635.502.

Section 10.735-211 affirms that an employee is free to join or not join an employee organization, and that an employee may participate in professional organizations not concerned with foreign policy subject to limitations. While these affirmations remain generally correct, they do not warrant continued publication and must be read, in any event, in the context of restrictions in the Standards (especially in subpart H) and certain conflict of interest statutes or regulations.

Section 10.735-211 briefly summarizes the “Hatch Act” restrictions and highlights several political activities that are permissible. It also briefly summarizes laws prohibiting disloyalty and striking. As discussed above, the restrictions on employee participation in political activities are referenced in more than one section of the Standards. Moreover, all of these laws are listed in subpart I of the Standards.

Section 10.735-211 also states that a U.S. citizen employee shall not engage in any form of political activity in any foreign country. This prohibition, as modified, is in volume 3 of the Foreign Affairs Manual. Section 10.735-206 lists several other restrictions or obligations that apply to U.S. citizen employees abroad, their family members, and non-U.S. citizen employees abroad. These restrictions and obligations derive from provisions in the Vienna Convention on Diplomatic Relations (23 U.S.T. 3227) and the Convention on Consular Relations (21 U.S.T. 77). They are published, as modified, in volume 3 of the Foreign Affairs Manual. This portion of volume 3 of the Foreign Affairs Manual also contains the substance of the requirement in section 10.735-215(b) requiring that an employee abroad obey the laws of the country in which the employee is present.

Section 10.735-205 contains a summary of an exception to certain conflict of interest statutes, 18 U.S.C. 203 and 205, and identifies “the head of the employee's division” as the appointing official authorized by the statutes to approve use of the exception. The statutes themselves are summarized in section 2635.801 (including general references to the exceptions) and in subpart I of the Standards. The statutes do not require that the identity of the appointing official be published in the CFR or elsewhere. Moreover, it is expected that the DAEOs and ethics staff will counsel employees concerning the identity of the “appointing official” who must approve use of the exception.

Section 10-735.205 mainly concerns 18 U.S.C. 208. All executive branch employees are prohibited by 18 U.S.C. 208 from participating in an official capacity in particular matters in which they, or certain persons or entities with whom they have specified relationships, have a financial interest. When part 10 was published in 1978, individual agencies were authorized by 18 U.S.C. 208 to adopt agency-specific regulations exempting financial interests from the applicability of the statutory prohibition. Section 10.735-205 lists the interests deemed by the Department under 18 U.S.C. 208(b) to be too “remote” or “inconsequential” to affect the integrity of an employee's services to the Government. The Ethics Reform Act of 1989 (Public Law No. 101-194), as amended, eliminated the authority of individual agencies to adopt waivers pursuant to 18 U.S.C. 208(b) and established OGE's authority to issue executive branch-wide exemptions. The initial OGE exemptions, now codified in subpart B of 5 CFR part 2640, became effective on August 28, 1995 and January 17, 1997. As of January 17, 1997, all of the agency-specific exemptions as in effect prior to November 30, 1989—including those in section 10.735-205 of part 10—were superseded.

Primarily in contemplation of conflicts arising under 18 U.S.C. 208, section 10.735-205 prohibits an employee from having a financial interest that conflicts or appears to conflict substantially with the employee's official duties. Section 10.735-205 also prohibits an employee from engaging in a financial transaction based on information obtained through Government employment. These provisions were superseded by sections 2635.403 and 2635.703 of the Standards.

Section 10.735-217 specifies a procedure by which an employee may request an advance written determination from the Under Secretary for Management at the Department or from the Administrator of USAID that the prohibitions of 18 U.S.C. 208 do not apply. These procedures have been supplanted by the procedures developed by the DAEOs and ethics staff to provide oral and written advice concerning matter relating to any of the Federal ethics laws and regulations, including the issuance of individual waivers as authorized by 18 U.S.C. 208.

Section 10.735-207 of part 10 prohibits the use of Government property for other than officially approved activities. This prohibition has been superseded by section Start Printed Page 169402635.704 of the Standards. As contemplated by the OGE regulation, various Foreign Affairs Manual provisions and other Department issuances define “authorized purposes.” In addition, the General Services Administration has promulgated various regulations concerning the use of Government property generally. Section 10.735-209 of part 10 requires an employee to pay all just financial obligations, especially taxes. This section has been superseded by section 2635.809 of the Standards. Section 10.735-208 of part 10 prohibits an employee from using nonpublic Government information to further a private interest (subject to an exception concerning the preparation of persons for certain examinations). This section has been superseded by section 2635.703 of the Standards (and, as discussed above, by 5 CFR 735.202 insofar as section 10.735-209 references an exception relating to the preparation of persons for certain examinations).

Section 10.735-210 of part 10 prohibits an employee from engaging in any gambling activity while on Government property or while on duty for the Government. Section 10.735-215(a) prohibits an employee from engaging in conduct prejudicial to the Government. These provisions remain implemented in sections 735.201 and 735.203, respectively, of the OPM regulation at 5 CFR part 735.

Section 10.735-212 of part 10 generally prohibits an employee of the Foreign Service from wearing any uniform except as may be authorized by law or as a military commander may require civilians to wear in a theatre of military operations, but indicates that certain attire should not be considered a uniform for purposes of this prohibition and refers to an appropriations restriction applicable to the then ICA pertaining to the purchase of uniforms. The statute underlying the prohibition, 22 U.S.C. 803, has been repealed by the Foreign Service Act of 1980 and, as discussed above, the ICA no longer exists. Moreover, members of the Foreign Service do not wear uniforms.

Section 10.735-213 concerns making recommendations in an official or personal capacity and references a statute, 22 U.S.C. 806, that prohibited an employee from recommending another person for employment by the country to which the employee is accredited or assigned. Section 806 has been repealed, and the limitations prescribed in section 10.735-213 concerning recommendations made in a personal capacity have been superseded by those in section 2635.702 of the Standards. To the extent that section 2635.702 is construed to apply to recommendations offered in an official capacity, it supersedes section 10.735-213 in that regard as well. The provision in section 10.735-213 pertaining to the recommendation of firms in connection with USAID programs is addressed in regulations pertaining to Government procurement and is, therefore, no longer necessary.

Section 10.735-214 contains a number of limitations on employees' transmission of communications and gifts. Paragraph (a) refers to limitations on correspondence regarding the affairs of foreign governments, which is derived from a statutory provision (former 22 U.S.C. 806(a)), which has been repealed.

Paragraph (b) provides that an employee must not act as agent for transmitting communications from persons or organizations in foreign countries to the President or other governmental officials, except that a chief of mission may do so when he or she determines it to be clearly in the public interest. This provision was derived from the restriction on transmitting gifts, and was intended as a practical limitation on employees serving as a conduit for transmitting communications from foreign persons or organizations. While this limitation still serves a valid purpose, it is reflected in other authorities and does not warrant the continued publication of 22 CFR part 10.

Paragraph (c) provides that an employee shall not act as agent for the transmission of gifts from persons or organizations in foreign countries to the President or other officials; however, principal officers may accept and forward to the Office of Protocol gifts made to the United States, or to any political division thereof, by the government to which they are accredited. This is largely a restatement of former 22 U.S.C. 804, which has been repealed. It also was intended as a practical limitation on employees serving as a conduit for transmitting gifts from foreign persons or organizations. The rules governing acceptance of gifts from foreign governments or international organizations are set out in the Foreign Gifts and Decorations Act and 22 CFR part 3. While the limitations on transmission of gifts also encompasses foreign individuals or organizations not affiliated with a foreign government or international organization, these limitations, as modified, are properly reflected in 2 FAM 344 and do not warrant the continued publication of this section of 22 CFR part 10.

Subpart C of part 10 concerns “special Government employees.” As defined in 18 U.S.C. 202, a special Government employee (SGE) is an officer or employee who is retained, designated, appointed, or employed by the Government to perform temporary duties, with or without compensation, for not more than 130 days during any period of 365 consecutive days. (The full statutory definition of SGE also encompasses employees serving in specified Government positions without regard to the number of days of expected service. In addition, particular statutes may specifically designate individuals occupying certain positions as SGEs.) Subpart C states generally that an SGE is subject to the conflict of interest statutes and to the U.S. Constitution as it pertains to gifts from foreign governments, referencing a discussion of the conflict of interest statutes in the now defunct Federal Personnel Manual and the regulations at 22 CFR part 3 implementing the Foreign Gifts and Decorations Act. In addition, subpart C contains standards deriving from E.O. 11222 that are specific to SGEs.

The definition of “employee” in section 2635.102 of the Standards encompasses SGEs. Therefore, the restrictions and obligations set forth (or summarized) in the Standards apply equally to SGEs and other employees unless a particular provision specifies (or explains) that SGEs are treated differently or are exempted altogether. For example, the compensation restriction in section 2635.807 of the Standards, relating to teaching, speaking, and writing, applies differently to SGEs (and, in fact, applies still differently to SGEs serving for 60 or fewer days). And, the summaries of 18 U.S.C. 209 in subparts B and H of the Standards make clear that the statute does not apply to SGEs at all.

Subpart D of part 10 concerns the system of confidential financial disclosure developed under authority of Executive Order 11222. Under authority conferred by Executive Order 12674 (and pursuant to authority in the Ethics in Government Act of 1978, as amended), OGE has established a revised system of confidential disclosure. As noted above, the revised system, published in 5 CFR part 2634, superseded subpart D of part 10 on October 5, 1992. Section 10.735-411 of subpart D concerns disqualification and other remedies available to address conflicts of interest. These matters are now addressed in various sections of 5 CFR parts 2634, 2635, and 2640. Start Printed Page 16941

Regulatory Findings

Administrative Procedure Act

In accordance with provisions of the Administrative Procedure Act governing rules promulgated by Federal agencies that affect the public (5 U.S.C. 552), the Department is publishing this direct final rule and inviting public comment.

Regulatory Flexibility Act

The Department of State, in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), has reviewed this regulation and, by approving it, certifies that this rule will not have a significant economic impact on a substantial number of small entities.

Unfunded Mandates Reform Act of 1995

This rule will not result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any year and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

This rule is not a major rule as defined by section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign based companies in domestic and import markets.

Executive Order 12866

The Department of State does not consider this rule to be a “significant regulatory action” under Executive Order 12866, section 3(f), Regulatory Planning and Review. In addition, the Department is exempt from Executive Order 12866 except to the extent that it is promulgating regulations in conjunction with a domestic agency that are significant regulatory actions. The Department has nevertheless reviewed the regulation to ensure its consistency with the regulatory philosophy and principles set forth in that Executive Order.

Executive Order 13132

This regulation will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, in accordance with section 6 of Executive Order 13132, it is determined that this rule does not have sufficient federalism implications to require consultations or warrant the preparation of a federalism summary impact statement.

Paperwork Reduction Act

This rule does not impose any new reporting or recordkeeping requirements subject to the Paperwork Reduction Act, 44 U.S.C. chapter 35.

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List of Subjects in 22 CFR Part 10

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Accordingly, under the authority of the Ethics in Government Act of 1978 (5 U.S.C. App.); Executive Order 12674, as modified by Executive Order 12731;

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Dated: January 19, 2005.

Grant S. Green Jr.,

Under Secretary of State for Management, Department of State.

Dated: March 11, 2005.

Steven Wisecarver,

Acting Assistant Administrator for Management, U.S. Agency for International Development.

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[FR Doc. 05-6383 Filed 4-1-05; 8:45 am]

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