INDEX
U.S. Department of Energy ORDER
Washington, D.C. DOE 5634.3
6-14-93
SUBJECT: FOREIGN OWNERSHIP, CONTROL, OR INFLUENCE PROGRAM
1. PURPOSE. To establish the policies, responsibilities, and authorities
for implementing the Department of Energy (DOE) Foreign Ownership,
Control, or Influence (FOCI) program which is designed to obtain
information that indicates whether DOE offerors/bidders or contractors/
subcontractors are owned, controlled, or influenced by foreign
individuals, governments, or organizations, and whether that foreign
involvement may pose an undue risk to the common defense and security.
2. APPLICATION TO CONTRACTS OR OTHER AGREEMENTS. The provisions of this
Order are to be applied to offerors/bidders and covered contractors/
subcontractors and they will apply to the extent implemented under a
contract or other agreement requiring access authorization(s). A
covered contractor is a seller of supplies or services that is awarded
a procurement contract or subcontract.
3. REFERENCES. See Attachment 1.
4. DEFINITIONS. See Attachment 2.
5: POLICY. It is Departmental policy to:
a. Prior to the award of a DOE contract or agreement requiring access
authorization(s), require offerors/bidders and all tier parents,
i.e., ultimate parent and any intervening levels of ownership, if
the offeror/bidder is controlled by another organization, to
submit complete, current, and accurate information, certification,
and explanatory documentation which define the extent and nature
of any relevant FOCI over the offeror/bidder and tier parents for
use by DOE in determining the risk presented by that FOCI.
b. To the extent permitted by law, treat information submitted by an
offeror/bidder, contractor/subcontractor, and, if applicable, all
tier parents as business/financial information submitted in
confidence.
c. Grant contractors DOE access authorizations after DOE has
determined that award of a contract or agreement to an offeror/
bidder or continued performance of a contract or agreement by a
contractor will not pose an undue risk to the common defense and
security.
d. For an existing DOE contract or agreement involving access
authorization(s), require the contractor and, if applicable, the
contractor's tier parents to submit the following to the DOE
office where the previously provided FOCI representations and
certification(s) were submitted:
(1) Written notification of anticipated changes which include,
but are not necessarily limited to, the following:
(a) Action to terminate the contractor organization or any
of its parents for any reason.
(b) Imminent adjudication of or reorganization in bankruptcy
of the contractor organization or any of its tier
parents.
(c) Discussions or consultations with foreign interests
which may reasonably be expected to lead to the
introduction or increase of FOCI.
(d) Negotiations for the sale of securities to a foreign
interest which may lead to the introduction or increase
of FOCI.
(2) Written notification of a change in the extent and nature of
FOCI which affects the information in the FOCI
representations and certification(s) previously provided.
(3) Complete, current, and accurate information,
certification(s), and explanatory documentation which define
the extent and nature of any relevant FOCI whenever:
(a) There is any change in ownership or control.
(b) Five years have elapsed since the previously provided
FOCI representations and certification(s) were executed.
(c) A DOE Headquarters or field safeguards and security
office advises that it considers that a relevant change
in the nature of the FOCI has occurred.
e. Not require the submission of the information and certification
required in the DEAR solicitation provision entitled "Foreign
Ownership, Control, or Influence (FOCI) over Contractor
(Representation)" for a modification and/or extension of an
existing DOE contract/agreement unless a contract/agreement is
modified into a contract/agreement requiring access
authorization(s).
f. Not require the submission of the information and certification
required in the DEAR solicitation provision entitled "Foreign
Ownership, Control, or Influence (FOCI) over Contractor
(Representation)" when the offeror/bidder requiring access
authorization(s) is a local, state, or Federal governmental
agency. However, the effected contract/agreement must contain a
security clause stating that if the governmental agency
subcontracts any work to a commercial entity, the provisions of
the DEAR and this Order apply.
g. Notwithstanding anything to the contrary contained in this Order,
DOE reserves the right and has the obligation to impose any
security method or requirement it believes necessary to ensure
that unauthorized access by foreign interests to classified
information and/or SNM is effectively precluded.
6. RESPONSIBILITIES AND AUTHORITIES.
a. RESERVED
b. RESERVED
c. Secretarial Officers shall:
(1) Assure implementation, for their Secretarial Offices, of
those portions of this Order applicable to Heads of Field
Elements.
(2) Ensure that Contracting Officers are notified when a
procurement request is subject to this Order.
d. Director of Safeguards and Security (SA-10) shall:
(1) Appoint a DOE employee, who is trained in the FOCI process,
to serve as the DOE FOCI Program Manager.
(2) Develop policies and procedures regarding the security
aspects of the FOCI program (except as delegated to the
Director of Naval Nuclear Propulsion Program in paragraph
6j.).
(3) Establish and maintain procedures to provide written
notification to the heads of field safeguards and security
offices and SA-14 of the FOCI determinations made by SA-10.
(4) Ensure review of all Representative of Foreign Interest (RFI)
Statements. Determine whether an individual who is an RFI is
eligible for a security clearance or continuation of a
security clearance.
(5) RESERVED
(6) Establish thresholds and/or other criteria whereby the heads
of field safeguards and security offices and SA-14 can render
FOCI determinations when all of the following factors apply:
(a) An offeror/bidder or contractor has an active Department
of Defense (DOD) facility clearance without the
limitations contained in paragraph 6m(7)(a).
(b) When the responses to the FOCI questions do not exceed
the thresholds established by SA-10.
(c) If controlled by another organization(s), the parent
organization(s) is performing, or proposing to perform,
work for DOE involving access authorization(s).
(7) Establish and maintain a listing of contractors and their
tier parents for which FOCI determinations were made by
SA-10.
(8) Ensure the Office of Safeguards and Security Central Training
Academy establishes and updates DOE's FOCI training program
to include procurement and security policy requirements that
pertain to FOCI.
e. Director of Policy, Standards and Analysis (SA-12) shall:
(1) Process requests for Facility National Agency Checks.
(2) Review each FOCI case forwarded to Headquarters by a
servicing safeguards and security office for a determination
as to eligibility for a facility approval or safeguards and
security activity.
(a) When the offeror/bidder or contractor is controlled by
another organization(s) which is not performing work for
DOE requiring a access authorization(s), obtain
appropriate written assurance from the offeror/bidder or
contractor and its parent organization(s) to exclude the
parent organization(s) from having any unauthorized
access.
(b) If determined to be under FOCI, advise the offeror/
bidder or contractor of the necessary action to negate
or reduce that foreign involvement or its effect.
Ensure assistance is provided to the offeror/bidder or
contractor in formulating effective security measures.
(3) In coordination with General Counsel, when appropriate,
prepare a memorandum for SA-10's signature which provides a
final FOCI determination to the servicing safeguards and
security office.
f. Director of Field Operations (SA-13) shall:
(1) Prior to registering a contractor on the Safeguards and
Security Information Management System, ensure that the
servicing safeguards and security office which submitted the
DOE F 5600.2, "Facility Data and Approval Record," has
indicated that a FOCI determination was rendered, including
the determination date.
(2) Review nuclear materials and security survey reports to
ensure that surveys examine the contractors' FOCI status.
g. General Counsel (GC-1) shall:
(1) Appoint a DOE employee, who is trained in the FOCI process,
to serve as the GC-1 FOCI point-of-contact.
(2) Upon request by SA-10, ensure review of all complex FOCI
cases; e.g., FOCI cases involving Proxy Agreements and Voting
Trusts.
(3) RESERVED.
h. Heads of Headquarters and Field Elements Contracting Activities
shall:
(1) Ensure that the contract clauses set forth in DEAR 952.204-2,
952.204-70, 952.204-74, and other relevant sections of 48 CFR
Chapter 9 are included in contracts, subcontracts,
agreements, and use of consultants requiring DOE access
authorizations.
(2) Appoint a DOE employee, who is trained in the FOCI process,
as the FOCI point-of-contact.
(3) Ensure, in the case of competitive solicitations, that a FOCI
determination will only be requested of the successful
offeror/bidder unless there is expected to be insufficient
lead time between selection and contract award to allow
deferral of the review.
(4) Ensure that the contracting officer provides the following
information to his/her servicing safeguards and security
office when a FOCI determination is requested:
(a) Identification of the legal party(ies) to the contract
or agreement; i.e., the signatories to the contract or
agreement.
(b) A brief unclassified description of the work, and
justification for its applicability to this Order.
(c) Highest classification level and category of information
and/or material to be accessed.
(d) Facility(ies) and/or DOE designated place(s) where the
work will be performed.
(e) Length of contract or agreement; i.e., number of
months/years.
(5) On contracts or agreements requiring access authorization(s)
for which they are responsible, ensure that the contracting
officer provides written notification to his/her servicing
safeguards and security office in each of the following
instances:
(a) When there is no longer a need for a requested FOCI
review.
(b) When a FOCI determination was rendered on an offeror/
bidder who was not the successful bidder.
(c) Within 30 days of the termination or completion of a
contract or agreement involving FOCI.
(6) When the offeror/bidder and, if applicable, the contractor's
tier parents has provided the FOCI representations and
certification(s) and not the Alternate Certification(s) of
Nonapplicability, ensure that the contracting officer, upon
written notification from his/her servicing safeguards and
security office, provides the successful offeror/bidder with
written notification that:
(a) Notifies the contractor that DOE has reviewed the FOCI
submission and determined the organization is not under
FOCI.
(b) Informs the contractor of its contractual obligation
and, if applicable, its tier parents' obligation to keep
current the information required in the DEAR contract
clause entitled "Foreign Ownership, Control, or
Influence (FOCI) over Contractor."
(c) Identifies the office providing such notification as the
responsible DOE office; i.e., the only office to which
the contractor and, if applicable, all tier parents will
provide new FOCI representations and certification(s) or
written notification of anticipated or significant
changes to their previously provided FOCI information,
and the office which should be identified by the
contractor and, if applicable, all tier parents on any
Alternate Certification(s) of Nonapplicability.
i. Deputy Assistant Secretary for Security Evaluations (EH-4) shall
provide independent oversight of the Safeguards and Security
Program, including FOCI.
j. Director of Naval Nuclear Propulsion Program (NE-60) shall, in
accordance with the responsibilities and authorities assigned by
Executive Order 12344 (statutorily prescribed by Public Law 98-525
(42 U.S.C. 7158, note)), and to ensure consistency throughout the
joint Navy/DOE organization of the Naval Nuclear Propulsion
Program, implement and oversee all policy and practices pertaining
to this Order for activities under the Director's cognizance.
k. Procurement Request Originator or such other individuals as
designated by the cognizant Secretarial Officers or Heads of Field
Elements shall bring to the attention of the responsible
contracting officer:
(1) Each procurement requiring the application of this Order and
the justification for its applicability.
(2) Requirements for flow-down of provisions of this Order to any
subcontract or subaward.
(3) Identification of the paragraphs or other portions of this
Order with which the awardee or, if different, a subawardee
is to comply.
l. Contracting Officers, based on advice received from the
procurement request originators or other designated individuals,
shall apply applicable provisions of this Order to awards falling
within its scope.
m. Heads of Field Elements and Director of Headquarters Operations
(SA-14) shall:
(1) Ensure appointment of a DOE employee as the FOCI
point-of-contact in each contracting/procurement
organization, and a FOCI Operations Manager in each
safeguards and security organization.
(2) Ensure the FOCI points-of-contact and FOCI Operations
Managers are trained in the FOCI process.
(3) Ensure that the contract clauses set forth in DEAR 952.204-2,
952.204-70, 952.204-74, and other relevant sections of 48 CFR
Chapter 9 are included in contracts, subcontracts,
agreements, and use of consultants requiring access
authorization(s).
(4) Ensure all required information and certification(s) are
obtained from the offeror/bidder/contractor and, if
applicable, all tier parents.
(5) If required, request from the offeror/bidder/contractor or
tier parents missing or explanatory information/data as
needed.
(6) Ensure that all FOCI answers and data are evaluated according
to existing DEAR requirements, DOE Acquisition Letters, and
applicable DOE Orders, and that a FOCI determination is
rendered prior to the award of a contract or agreement under
their cognizance which requires access authorization(s).
(7) For each initial FOCI evaluation of an offeror/bidder, not to
include an offeror/bidder who is an individual, contact the
DOD Defense Investigative Service (DIS)/Central Verification
Activity (CVA) to obtain written confirmation from DIS/CVA of
those offerors/bidders which have active DOD facility
clearances.
(a) When the written confirmation received from DIS/CVA
shows that the offeror's/bidder's cleared facility has a
Limited Facility Clearance (formerly "Reciprocal"
clearance), or DIS/CVA cannot verify the offeror's/
bidder's clearance and provides a telephone number to
call for verification, ensure that these submissions are
immediately forwarded to SA-12 for review.
(b) When the offeror/bidder does not have an active DOD
facility clearance as determined by DIS/CVA, ensure that
a copy of these submissions are forwarded to SA-12 for a
Facility National Agency Check. However, the servicing
safeguards and security office can render the FOCI
determination prior to forwarding the FOCI
representations and certification(s) and suppOrting
information to SA-12 when both of the following factors
apply:
1 The responses to the FOCI questions do not exceed
the thresholds established by SA-10.
2 If controlled by another organization(s), the
parent organization(s) is performing, or proposing
to perform, work for DOE requiring access
authorization(s).
(8) Ensure the servicing safeguards and security offices provide
FOCI determinations on offerors/bidders/contractors if
delegated such authority as defined in paragraphs 6m(7)(a)
and 6m(7)(b).
(9) Refer FOCI cases to SA-12 when the servicing safeguards and
security offices are unable to resolve the FOCI factors
present or have not been delegated authority to grant a
facility approval or safeguards and security activity or
continue a contractor's facility approvals and safeguards and
security activities. Ensure each case file referred to SA-12
contains all required information and certification(s) from
the offeror/bidder/contractor and, if applicable, all tier
parents, and document the reason(s) the case has been
forwarded.
(10) Ensure that during required nuclear materials and security
surveys required by DOE 5634.1B, DOE personnel verify that a
FOCI determination was rendered by the appropriate security
office (i.e., servicing safeguards and security office or
SA-10) on the contractor and, if applicable, all tier
parents, and that there has been no significant change in the
extent and nature of FOCI which would affect the information
in the FOCI submission(s) most recently filed with DOE,
including any change(s) in ownership or control.
(11) Establish and maintain a listing of contractors for which
FOCI determinations were made by the servicing safeguards and
security offices and provide an updated list of such
contractors to SA-10 quarterly on a fiscal year basis.
(12) On an existing DOE contract or agreement requiring access
authorization(s), ensure that the contractor and, if
applicable, the contractor's tier parents possess a favorable
FOCI determination.
(13) Ensure that contractors who possess an existing FOCI
determination and, if applicable, the contractors' tier
parents submit the following to the responsible DOE office;
i.e., the office where the previously provided FOCI
representations and certifications were submitted:
(a) Written notification of anticipated changes which
include, but are not necessarily limited to the
following:
1 Action to terminate the contractor organization or
any of its parents for any reason.
2 Imminent adjudication of or reorganization in
bankruptcy of the contractor organization or any of
its tier parents.
3 Discussions or consultations with foreign interests
which may reasonably be expected to lead to the
introduction or increase of FOCI.
4 Negotiations for the sale of securities to a
foreign interest which may lead to the introduction
or increase of FOCI.
(b) Written notification of a change in the extent and
nature of FOCI which affects the information in the FOCI
representations and certifications previously provided.
(c) Complete, current, and accurate information,
certifications, and explanatory documentation which
define the extent and nature of any relevant FOCI
whenever:
1 There is any change in ownership or control.
2 Five years have elapsed since the previously
provided FOCI representations and certifications
were executed.
3 A DOE Headquarters or field safeguards and security
office advises that it considers that a relevant
change in the nature of the FOCI has occurred.
(14) Ensure that the following is accomplished upon notification
by the contracting officer of the termination or completion
of a contract or agreement when the contractor has no other
active contracts or agreements with that DOE office that
require access authorization(s):
(a) If not the responsible DOE office, provide written
notification to the responsible DOE office that the
reporting office has no active contracts or agreements
with the contractor which require access
authorization(s).
(b) When the DOE office is the responsible DOE office:
1 Determine if the contractor is performing work on
any contracts or agreements requiring access
authorization(s) under the cognizance of another
DOE office(s) by checking the contractor's FOCI
file for an Alternate Certification(s) of
Nonapplicability.
2 Transfer the contractor's FOCI file to the first
office which requested verification of the
contractor's Alternate Certification of
Nonapplicability, if any, if the contractor is
performing work on a contract(s)/agreement(s)
requiring access authorization(s).
3 Provide written notification to the contractor that
its FOCI file has been transferred to a new
responsible DOE office to which the contractor and,
if applicable, all tier parents should provide all
future FOCI representations and certification(s) or
written notifications of anticipated or significant
changes, and which should be identified by the
contractor and, if applicable, all tier parents on
any Alternate Certification(s) of Nonapplicability.
4 If the contractor is not performing work on any
contracts or agreements requiring access
authorization(s) at another DOE office, retain the
contractor's file.
5 Advise SA-12 in writing of the action taken
regarding the transfer or retention of the
contractor's FOCI file.
7. BACKGROUND.
a. The FOCI program was initiated in response to the concern that if
a DOE contractor is owned, controlled, or significantly influenced
by a foreign interest(s), there is a risk that such a contractor
could be financially or politically coerced or induced into
providing DOE classified information and/or SNM to the foreign
interest, or impact adversely the performance of a contract(s) or
agreement(s) involving access to classified information and/or
SNM.
b. When DOE solicits bids or proposals for a contract(s) or
agreement(s) requiring access authorization(s), a FOCI submission
is required of the offerors/bidders and all tier parents; i.e.,
ultimate parent and any intervening levels of ownership, if the
offeror/bidder is controlled by another organization. A FOCI
submission consists of answers to an eleven-part questionnaire
(i.e., the FOCI representations), a certification of its accuracy,
and back-up or explanatory information.
8. CONCEPT OF OPERATIONS. This paragraph lists requirements for
eligibility for a facility approval or safeguards and security
activity, identifies factors that shall be considered in determining
whether an offeror/bidder or a contractor is or may be under FOCI,
prescribes procedures for accepting a FOCI determination rendered by
another Federal agency, and outlines procedures for processing and
rendering determinations.
a. Eligibility Requirements.
(1) A U.S. organization effectively owned or controlled by a
foreign government is ineligible for a facility approval or a
safeguards and security activity unless the Secretary of
Energy determines that a waiver is essential to the national
security interest of the U.S.
(2) An offeror/bidder that is owned, controlled, or influenced by
a foreign interest from a sensitive country identified in DOE
1500.3, FOREIGN TRAVEL AUTHORIZATION, and DOE 1240.2B,
UNCLASSIFIED VISITS AND ASSIGNMENTS BY FOREIGN NATIONALS,
shall not be eligible, in some cases, for a facility approval
or safeguards and security activity. SA-10 will make the
determination.
(3) An offeror/bidder that is owned, controlled, or influenced by
a foreign interest from a nonsensitive country shall be
eligible for a facility approval or safeguards and security
activity provided action can be taken to effectively negate
or reduce associated FOCI risk to an acceptable level.
(4) The chairman of the board and all principal officers of the
U.S. organization(s) to be cleared for a facility approval or
safeguards and security activity must be U.S. citizens
residing within the limits of the U.S.
b. Factors. An offeror/bidder/contractor will be considered under
FOCI when a reasonable basis exists to conclude that the nature
and extent of FOCI over the management or operations of the
offeror/bidder/contractor may result in the compromise of
classified information or unauthorized access to SNM. The
following factors will be considered in determining whether an
organization is under FOCI or has FOCI involvement:
(1) Foreign interest ownership or beneficial ownership of 5
percent or more of the organization's securities.
(2) Ownership by the organization of any foreign interest in
whole or in part.
(3) Foreign interest representation in one or more management
positions such as directors, officers, or executive
personnel.
(4) Foreign interest in a position to control or influence the
election, appointment, or tenure of one or more of the
directors, officers, or executive personnel of the
organization.
(5) Contract(s), agreement(s), understanding(s), or other
arrangement(s) with a foreign interest.
(6) Indebtedness, actual or potential (unused lines of credit),
to a foreign interest.
(7) Any revenue derived from a sensitive country.
(8) Revenue in excess of 10 percent of total revenue from foreign
interest(s).
(9) Five percent or more of any class of the organization's
securities held in "nominee shares," "street names," or some
other method which does not disclose the beneficial owner of
equitable title.
(10) Interlocking directors with foreign interests.
(11) Any citizen(s) of a foreign country(ies), whether an employee
or visitor, who may have access to classified information
and/or SNM.
(12) Any other factor that indicates or demonstrates a capability
on the part of a foreign interest to control or influence the
operations, management, or business of the organization.
c. Procedures for Accepting a FOCI Determination Rendered by Another
Federal Agency. DOE will accept a DOD FOCI determination when
Work For Others, as outlined in DOE 4300.2B, NON-DEPARTMENT OF
ENERGY FUNDED WORK (WORK FOR OTHERS), is DOD-funded and is
subcontracted to a DOD contractor, and for DOE-funded work being
conducted by a DOD contractor at an existing DOD-cleared facility,
when the following requirements are met:
(1) The offeror/bidder has not been granted a Limited Facility
Clearance (formerly "Reciprocal" clearance) by DOD or the
offeror/bidder is not operating under a DOD Special Security
Agreement.
(2) Only access to National Security Information will be
required.
(3) The requirements for accepting an existing DOD facility
approval in DOE 5634.1B, FACILITY APPROVAL, SECURITY SURVEYS,
AND NUCLEAR MATERIALS SURVEYS, are met.
(4) The offeror/bidder certifies that the FOCI information
submitted to the DOD Defense Investigative Service is
complete, current, and accurate.
If all of the above requirements are not met, the servicing
safeguards and security office shall ensure that the offeror/
bidder is required to submit to DOE comprehensive FOCI
representations and certification for evaluation in
accordance with this Order.
d. Processing Offerors/Bidders for Initial FOCI Determinations.
(1) After verifying that all required information is contained
within the submission(s), the DOE contracting officer shall
forward the FOCI package to his/her servicing safeguards and
security office.
(2) The servicing safeguards and security office shall render the
FOCI determination when all of the following factors apply:
(a) The offeror/bidder has an active DOD facility clearance
without the limitations contained in paragraph 6m(7)(a).
(b) The responses to the FOCI questions do not exceed the
thresholds established by SA-10.
(c) If controlled by another organization(s), the parent
organization(s) is performing, or proposing to perform,
work for DOE requiring access authorization(s).
(3) Whenever the servicing safeguards and security office is
unable to resolve the FOCI factors present or has not been
delegated authority to grant a facility approval or
safeguards and security activity, the case file shall be
forwarded to SA-12 with a recommended determination. SA-12
shall review the package to determine if it concurs with the
servicing safeguards and security office's recommended
favorable or unfavorable determination.
(4) SA-12, in coordination with General Counsel, when
appropriate, will prepare a memorandum for SA-10's signature
which provides a final FOCI determination to the servicing
safeguards and security office.
e. Processing Contractors Who Complete Alternate Certifications of
Nonapplicability.
(1) The Alternate Certification(s) of Nonapplicability, provided
by a contractor and, if applicable, its tier parents shall
identify the DOE office which has been identified as the
responsible office, provide the date of the previously
provided FOCI representations and certification(s), and
include a copy of the written notification the contractor
received from DOE.
(2) The contracting officer shall verify Alternate
Certification(s) of Nonapplicability through his/her
servicing safeguards and security office.
(3) The servicing safeguards and security office shall accomplish
the following upon receipt of such a request from the
contracting officer:
(a) Submit the Alternate Certification(s) of
Nonapplicability to the relevant servicing safeguards
and security office and request written verification of
the contractor's and, if applicable, its tier parents'
Alternate Certification(s) of Nonapplicability, to
include a copy of the FOCI determination. However, if 5
years have elapsed since the last FOCI representations
and certification(s) were executed, the responsible DOE
office will request a new submission from the contractor
and/or, if applicable, the contractor's tier parents.
(b) At a minimum, written verification will include:
1 Whether the FOCI determination was rendered by the
appropriate security office (i.e., servicing
safeguards and security office or SA-10), to
include the date of the determination.
2 The factors upon which the determination was based
and the limitations, if any, imposed for reasons of
FOCI.
3 Whether DIS/CVA was contacted and written
confirmation of the contractor's active DOD
facility clearance was received from DIS/CVA; or,
if the contractor did not have an active DOD
facility clearance as determined by DIS/CVA,
whether the contractor's information was forwarded
to SA-12 for a Facility National Agency Check.
4 Whether the file(s) contains any new or unresolved
FOCI issues.
5 Whether the individual who executed the Alternate
Certification of Nonapplicability is an authorized
official, or is any other employee who an
authorized official designated in writing with the
authority to execute the FOCI representations and
certification on behalf of the organization.
(c) Upon receipt of a favorable written verification, the
servicing safeguards and security office shall provide
written notification to the submitting contracting
officer that verification of the contractor's and, if
applicable, its tier parents' previous certification(s)
has been completed.
(4) When a contractor and, if applicable, its tier parents have
provided the Alternate Certification(s) of Nonapplicability
and the previous certification(s) is verified, written
confirmation of a FOCI determination shall not be provided to
the contractor.
f. Schedule for Processing FOCI Determinations.
(1) The following schedules (in working days) shall be observed
by the servicing safeguards and security office in processing
FOCI determinations:
(a) Initial review and verification procedures shall be
accomplished by the servicing safeguards and security
office within 15 days of the receipt of a FOCI
submission from the contracting officer.
(b) Within an additional 20 days, one of the following
actions will be taken by the servicing safeguards and
security office:
1 A FOCI determination will be rendered.
2 If required, additional information will be
requested either verbally or in writing from the
offeror/bidder/contractor.
3 Forward the FOCI case to SA-12 when any of the
following factors apply:
a When the written confirmation received from
DIS/CVA shows that the offeror's/bidder's
cleared facility has a Limited Facility
Clearance (formerly "Reciprocal" clearance),
or DIS/CVA cannot verify the offeror's/
bidder's clearance and provides a telephone
number to call for verification.
b The responses to the FOCI questions exceed the
thresholds established by SA-10.
c If controlled by another organization(s), the
parent organization(s) is not performing, or
proposing to perform, work for DOE requiring
access authorization(s).
(c) If additional information is requested, the following
procedures will be followed:
1 The offeror/bidder/contractor should provide the
requested information within 15 days from the date
of notification. Upon receipt of the requested
information, the servicing safeguards and security
office will review the information within 10 days
and, if complete, either render a FOCI
determination or, when appropriate, forward the
submission to SA-12 for review.
2 If the offeror/bidder/contractor does not provide
the additional information within 15 days, the
servicing safeguards and security office shall
provide written notification to the submitting
contracting officer that processing of the request
will stop and the FOCI submission will be returned
to his/her office if the requested information is
not received from the offeror/bidder/contractor
within an additional 15 days.
3 When a FOCI determination is still required on any
such returned cases, the contracting officer must
then resubmit the request to his/her servicing
safeguards and security office after the offeror/
bidder/contractor has provided the additional
information. Such requests will be considered new
submissions and will be processed according to the
schedules provided above.
(2) The following schedules (in working days) shall be observed
by SA-12 in processing FOCI cases submitted by the servicing
safeguards and security offices:
(a) Upon receipt of a FOCI case from a servicing safeguards
and security office, SA-12 will review the submission
within 15 days. If the submission is incomplete or does
not address all the FOCI issues, SA-12 will either
verbally or in writing notify the servicing safeguards
and security office of the additional information
required. If the required information is not received
within 30 days from the date of notification, the FOCI
case will be returned without further action. When a
FOCI determination is still required on any such
returned case, the servicing safeguards and security
office must then resubmit the request to SA-12 for a
FOCI determination after obtaining the missing
information from the offeror/bidder/contractor. Upon
resubmission, the request will be considered a new
submission and will be processed according to the
schedule indicated above.
(b) Within an additional 20 days, one of the following
actions will be taken by SA-12 on complete FOCI
submissions:
1 In coordination with General Counsel, when
appropriate, prepare a memorandum for SA-10's
signature which provides a final FOCI determination
to the servicing safeguards and security office.
2 If required, advise the offeror/bidder/contractor
in writing of any security measures (e.g., board
resolutions or other methods to negate or reduce
FOCI) required to be placed into effect in order
for the offeror/bidder to be eligible for access
authorization(s) or for continuation of a
contractor's facility approvals and safeguards and
security activities. Within 15 days from the date
of SA-12's notification, the offeror/bidder/
contractor must provide evidence that the necessary
security measures have or will be implemented.
3 If the offeror/bidder has not provided SA-12
evidence that the necessary security measures have
or will be implemented within the time frame
mentioned in paragraph 8f(2)(b)2, SA-12 will
provide written notification to the servicing
safeguards and security office of the offeror's/
bidder's noncompliance. In turn, the servicing
safeguards and security office will provide written
notification to the submitting contracting officer
of the offeror's/bidder's noncompliance and that if
the required action/information is not taken/
provided within an additional 15 days, processing
of the request will stop and the FOCI submission
will be returned to his/her office.
4 If the necessary security measures cannot be placed
into effect, SA-12 will notify the servicing
safeguards and security office in writing as
mentioned in 8f(2)(b)1 that the offeror/bidder
shall be ineligible for access authorization(s).
5 If a contractor has not provided SA-12 evidence
that the necessary security measures have or will
be implemented within the time frame mentioned in
paragraph 8f(2)(b)2, SA-12 will provide written
notification to the responsible DOE office's
servicing safeguards and security office of the
contractor's noncompliance. In turn, the
responsible DOE office will provide written
notification to the contractor that its facility
approvals and safeguards and security activities
may be suspended if the required action/information
is not taken/provided within an additional 15 days.
6 If the contractor is determined to be under FOCI
and the contractor will not implement the necessary
security measures, SA-12 will notify the
responsible DOE office's servicing safeguards and
security office in writing as mentioned in
8f(2)(b)(1) of an adverse determination which may
result in the contractor's facility and activities
being shut down/suspended pending resolution of the
FOCI.
(3) The following actions will be taken if the identified time
frames are not achieved by the servicing safeguards and
security office and/or SA-12:
(a) The servicing safeguards and security office shall
provide written notification to the submitting
contracting officer, with a copy to SA-12, regarding the
reason for the delay in processing/completing the
submission and the expected completion date.
(b) SA-12 shall provide written notification to the
servicing safeguards and security office regarding the
reason for the delay in processing/completing the
submission and the expected completion date.
g. Significant FOCI Changes.
(1) When a change(s) in the extent and nature of FOCI which would
affect the information in a contractor's and/or, if
applicable, its tier parents' most recent DOE FOCI
submission(s) has occurred, the contractor/parent shall
immediately provide written notification and explanatory/
supporting documentation relevant to the change(s) to the
responsible DOE office. A significant FOCI increase(s)/
change(s) which warrants processing of the contractor/parent
for a new FOCI determination includes, but is not necessarily
limited to, the following:
(a) A new threshold or factor that did not exist when the
previous determination was made (e.g., a "no" answer
changes to a "yes" answer), and any additional factors
associated with the questions on the FOCI
representations and certification.
(b) A previously reported threshold or factor that was
favorably evaluated by the servicing safeguards and
security office has increased to a level requiring a
determination by SA-10.
(c) A previously reported financial threshold or factor that
was favorably evaluated has increased by 5 percent or
more.
(d) A previously reported foreign ownership threshold or
factor that was favorably evaluated by SA-10 has
increased to the extent that a method of negation or
reduction (see paragraphs 10 and 11) is necessary.
(e) Any change(s) in the ownership or control of the
contractor and/or, if applicable, the contractor's tier
parents.
(f) An employee who becomes an RFI, as defined in Attachment
2, or the status of an existing RFI changes in a manner
that would make the employee ineligible for a security
clearance.
(2) The responsible DOE office's servicing safeguards and
security office will provide new FOCI determinations to those
DOE safeguards and security offices who have requested
written verification of an Alternate Certification of
Nonapplicability provided by a contractor.
9. ADVERSE DETERMINATION. When an offeror/bidder or contractor determined
to be under FOCI will not take the necessary security measures, as
determined by DOE, to negate or reduce FOCI to an acceptable level, an
adverse determination will be rendered by SA-10.
10. METHODS TO NEGATE OR REDUCE UNACCEPTABLE FOCI. DOE, the effected U.S.
organization(s), or its legal representatives may propose a plan to
negate or reduce unacceptable FOCI, but the primary responsibility for
approving such a plan rests with DOE. A plan may consist of one of the
insulating measures prescribed in paragraph 11 or any combination of
those measures, as appropriate. It may also consist of other measures
employed in conjunction with, or apart from, these methods, such as:
a. Physical or organizational separation of the component performing
the work requiring access authorization(s).
b. Modification or termination of agreements with foreign interests.
c. Diversification or reduction of agreements with foreign interests.
d. Diversification or reduction of income from foreign interests.
e. Assignment of specific security duties and responsibilities to
selected officials of the organization.
f. Creation of special executive-level committees to consider and
oversee classified information and/or SNM.
11. METHODS TO NEGATE OR REDUCE RISK IN FOREIGN OWNERSHIP CASES. Under
normal circumstances, foreign ownership of a U.S. organization under
consideration for a facility approval or safeguards and security
activity becomes a concern to DOE when the amount of foreign-owned
stock is at least sufficient to elect representation to the U.S.
organization's board of directors or a foreign interest(s) is in a
position to select such representatives. Foreign ownership which
cannot be so manifested is not, in of itself, considered significant.
Instances involving insignificant foreign stockholdings are,
nonetheless, analyzed to assess the ownership source and to determine
the possible significance when considered in conjunction with other
aspects of foreign involvement which may be present in a particular
case.
a. Board Resolution for Noncontrolling Foreign Minority Cases. When
a foreign interest(s) owns voting stock, directly or indirectly,
that is sufficient to elect representation to the U.S.
organization's board of directors, a resolution(s) by the U.S.
organization's board of directors and other actions as described
below may be considered as a method to negate or reduce the FOCI.
(1) Contents of the Resolution(s). The resolution(s) must be to
the following effect:
(a) Acknowledge and describe all FOCI elements; identify the
foreign interest(s) and its representative(s), including
those who are U.S. citizens; describe the type and
number of foreign-owned shares.
(b) Acknowledge the organization's obligations to comply
with all security program and export control
requirements.
(c) Certify that the foreign interest(s) shall not require,
shall not have, and can be effectively precluded from
access to all classified information and/or SNM
entrusted to or held by the U.S. organization; certify
that the foreign interest(s) will not be permitted to
occupy a position(s) that would enable it/them to
influence the organization's policies and practices in
the performance of contracts or agreements requiring
access authorization(s); and provide for an annual
certification to DOE acknowledging the continued
effectiveness of the resolution.
(2) Publication of the Resolution(s). The U.S. organization
shall be required to distribute to its directors and its
principal officers copies of such resolutions and report in
its corporate records the completion of such distribution.
In addition, the substance of the foregoing resolution(s)
shall be brought to the attention of all personnel possessing
or being processed for a DOE security clearance.
(3) Criteria. The following criteria must also be satisfied in
order for a board resolution to be utilized as the sole
method accepted to negate or effectively reduce the risk of
compromise arising from foreign ownership within the levels
prescribed herein:
(a) Identified U.S. interests own a majority of the stock;
(b) A foreign interest(s) is not the single largest
shareholder; and
(c) The nature and distribution of the minority
stockholdings and the composition and structure of
management does not permit a foreign interest(s) to
control or dominate the business management of the U.S.
organization.
(4) Verification. Compliance with the resolution(s) shall be
verified during periodic surveys. There are circumstances
when it may become necessary for the U.S. organization's
board of directors to adopt further resolutions and take
additional administrative actions to assure DOE that the
existing facility approvals and safeguards and security
activities remain clearly consistent with the national
interest.
b. Controlling Foreign Majority Cases.
(1) Voting Trust Agreement. A Voting Trust Agreement is an
acceptable method to negate or reduce risks associated with
foreign ownership when a foreign interest(s) owns a majority
of the voting securities of the U.S. organization or, if less
than 50 percent foreign-owned, it can be reasonably
determined that the foreign interest(s) or its/their
representative(s) is in a position to effectively control or
have the dominant influence over the business management of
the U.S. organization. Under this arrangement, the following
requirements must be met:
(a) The foreign stockholder(s) must transfer legal title of
foreign-owned stock to the Trustees, and the U.S.
organization to be cleared must be organized, structured
and financed so as to be capable of operating as a
viable business entity independent from the foreign
stockholder(s).
(b) The Voting Trust Agreement must unequivocally provide
for the exercise of all prerogatives of ownership by the
Trustees with complete freedom to act independently and
without consultation with, interference by, or influence
from foreign stockholder(s).
(c) There shall be at least three Trustees, and all must
become members of the U.S. organization's board of
directors. In addition, the Trustees must:
1 Be U.S. citizens residing within the limits of the
U.S. and capable of assuming full responsibility
for voting the stock and exercising the management
prerogatives relating thereto in such a way as to
ensure that the foreign stockholder(s) will be
effectively insulated from the cleared U.S.
organization.
2 Be completely disinterested individuals with no
prior involvement with either the cleared U.S.
organization, its foreign-owned tier parent(s), and
any of its foreign-owned affiliate(s).
3 Be issued a security clearance to the level of the
facility approval or safeguards and security
activity.
4 Be approved by SA-10 when a vacancy occurs due to
the resignation or removal of a Trustee and a
successor Trustee is appointed by the remaining
Trustees.
5 Prior to being accepted as Trustees by SA-10, be
advised by SA-10 of the duties and responsibilities
they are undertaking on behalf of DOE to insulate
the cleared U.S. organization from the foreign
interest(s), and indicate, in writing, their
willingness to accept this responsibility.
(d) The Voting Trust Agreement may, however, limit the
authority of the Trustees by requiring approval from the
foreign stockholder(s) with respect to:
1 The sale or disposal of the cleared U.S.
organization's assets or a substantial part
thereof;
2 Pledges, mortgages or other encumbrances on the
capital stock which they hold in trust;
3 Corporate mergers, consolidations, or
reorganizations;
4 The dissolution of the cleared U.S. organization;
and
5 The filing of a bankruptcy petition.
(e) The Trustees must assume full responsibility for the
voting stock and for exercising all management
prerogatives relating thereto in such a way as to ensure
that the foreign stockholder(s), except for the
approvals enumerated above, will be effectively
insulated from the cleared U.S. organization and
continue solely in the status of beneficiaries.
(f) The Certification and Visitation Approval Procedure
Agreement of paragraph 11b(3) is required under this
arrangement.
(2) Proxy Agreement. A Proxy Agreement is an acceptable method
to negate or reduce risks associated with foreign ownership
when a foreign interest(s) owns a majority of the voting
securities of the U.S. organization or, if less than 50
percent foreign-owned, it can be reasonably determined that
the foreign interest(s) or its/their representative(s) is in
a position to effectively control or have the dominant
influence over the business management of the U.S.
organization. Under this arrangement, the voting rights of
stock owned by a foreign interest(s) are conveyed to Proxy
Holders by an irrevocable Proxy Agreement. Legal title to
the stock remains with the foreign interest(s). All other
provisions of the Voting Trust Agreement as applies to
Trustees (see paragraph 11(b)(1)) and the terms of the
agreement shall apply to the Proxy Holders. Conditions for
consideration of use of a Proxy Agreement are the same as
required for a Voting Trust Agreement.
(3) Visitation Approval Procedure Agreement. In every case where
a Voting Trust Agreement or Proxy Agreement is employed to
negate or reduce risks associated with foreign ownership, a
Visitation Approval Procedure Agreement shall be executed
between the cleared U.S. organization, the foreign
interest(s), SA-10, and as appropriate, Trustees, Proxy
Holders, or other designated individuals. The Visitation
Approval Procedure Agreement must identify who may visit, for
what purposes, when advance approval is necessary, and the
approval authority. The cleared U.S. organization shall
submit individual requests to the approval authority for each
visit. The Visitation Approval Procedure Agreement shall
provide that, as a general rule, visits between the foreign
stockholder(s) and the cleared U.S. organization are not
authorized; however, as an exception to the general rule, the
approval authority may approve such visits in connection with
regular day-to-day business operations pertaining strictly to
purely commercial products or services and not pertaining to
contracts requiring access authorization(s).
12. ANNUAL REVIEW AND COMPLIANCE.
a. Annual Review. Representatives of SA-10 shall meet at least
annually with senior management officials of U.S. organizations
operating under a DOE-approved Voting Trust or Proxy Agreement to
review the purpose and effectiveness of the pertinent security
arrangement, and to establish common understanding of the
operating requirements and how they will be implemented within the
cleared U.S. organization. These reviews will include at least a
discussion of the following:
(1) Whether the security arrangement is working in a satisfactory
manner.
(2) Compliance or acts of noncompliance with the approved
security arrangement.
(3) Problems or impediments associated with the practical
application or utility of the security arrangement.
(4) Whether security controls, practices, or procedures warrant
adjustment.
b. Annual Certification. At the end of each year of operation, the
Trustees, Proxy Holders, or other principals, as appropriate,
shall submit to SA-10 an annual implementation and compliance
report. Such reports shall include the following information:
(1) A detailed description of the manner in which the cleared
U.S. organization is fulfilling its obligations under the
applicable security arrangement.
(2) Changes to security procedures, implemented or proposed, and
the reasons for those changes.
(3) A detailed description of any acts of noncompliance, whether
inadvertent or intentional, with a discussion of what steps
were taken to prevent such acts from recurring.
(4) Any changes, or impending changes, of senior management
officials, or key board members, including the reasons
therefor.
(5) Any other issues that could have a bearing on the
effectiveness of the applicable security arrangement.
Failure on the part of the cleared U.S. organization to
assure compliance with the terms of the applicable security
arrangement may result in the organization's facility and
activities being shut down/suspended pending resolution of
the FOCI.
13. SUPPLEMENTARY DIRECTIVES AND GUIDANCE. Supplementary directives to
this Order pertaining to requirements, standards and procedures shall
be published as a DOE Manual which will be issued as part of the
Departmental Directives System, subject to appropriate coordination.
This Manual shall contain requirements, standards, and procedures that
are nondiscretionary, mandatory requirements. Additional guidance will
be issued containing information pertaining to matters which are
discretionary.
14. IMPLEMENTATION. This Order is effective upon the date of issue shown.
BY ORDER OF THE SECRETARY OF ENERGY:
LINDA G. SYE
Acting Assistant Secretary for
Human Resources and Administration
REFERENCES
1. Title 42 U.S.C. 2011, et seq., "Atomic Energy Act of 1954," as amended,
which establishes standards and instructions to govern the possession
and use of special nuclear material, nuclear material, and source
material, and byproduct material and establishes procedures for control
of atomic energy information.
2. Title 10 CFR 1016, "Safeguarding of Restricted Data," of 8-10-83, which
establishes criteria and procedures for the protection of Restricted
Data.
3. Title 48 CFR Chapter 9 (Department of Energy Acquisition Regulation
(DEAR)) sets forth the security provision and contract clauses to be
used in DOE solicitations and contracts or agreements involving access
to classified information and/or a significant quantity of SNM. They
are:
a. DEAR Subpart 904.70, "Foreign Ownership, Control, or Influence
over Contractors," which sets forth the DOE policies and
procedures regarding FOCI over contractors.
b. DEAR 952.204-2, "Security," a clause required in contracts under
Section 31 (research assistance) or 41 (ownership and operation of
production facilities) of the Atomic Energy Act of 1954, as
amended, and in other contracts and subcontracts, the performance
of which involves or is likely to involve classified information.
c. DEAR 952.204-70, "Classification," a clause required in all
contracts that involve classified information.
d. DEAR 952.204-73, "Foreign Ownership, Control or Influence (FOCI)
Over Contractor (Representation)," a provision required in all
solicitations for contracts subject to DEAR 904.70.
e. DEAR 952.204.74, "Foreign Ownership, Control, or Influence (FOCI)
Over Contractor," a clause required in new contracts subject to
DEAR 904.70.
4. Executive Order 10865, "Safeguarding Classified Information within
Industry," of 2-20-60, which established criteria and procedures for
the protection of classified National Security Information within
industry.
5. Executive Order 12356, "National Security Information," of 4-2-82,
which provides requirements for protecting National Security
Information, and "Information Security Oversight Office Directive No.
1," of 6-25-82, which assists in implementing Executive Order 12356.
6. Executive Order 12829, "National Industrial Security Program," of
1-6-93, which establishes a single, integrated, cohesive industrial
security program to protect classified information and to preserve the
Nation's economic and technological interests.
7. DOE 1240.2B, UNCLASSIFIED VISITS AND ASSIGNMENTS BY FOREIGN NATIONALS,
of 8-21-92, which establishes DOE authorities, responsibilities, and
policies and prescribes administrative procedures for visits and
assignments by foreign nationals to DOE facilities for purposes
involving unclassified matter.
8. DOE 1500.3, FOREIGN TRAVEL AUTHORIZATION, of 11-10-86, which
establishes DOE policy and procedures for official and unofficial
foreign travel.
9. DOE 4300.2B, NON-DEPARTMENT OF ENERGY FUNDED WORK (WORK FOR OTHERS), of
7-16-91, which establishes policy, responsibilities, and procedures for
authorizing and administering non-DOE funded work performed under DOE
contracts.
10. DOE 5630.11A, SAFEGUARDS AND SECURITY PROGRAM, of 12-7-92, which
establishes policy and responsibilities for the DOE Safeguards and
Security Program.
11. DOE 5630.12A, SAFEGUARDS AND SECURITY INSPECTION AND ASSESSMENT
PROGRAM, of 6-23-92, which establishes an independent inspection and
assessment program to determine the effectiveness of the Department's
safeguards and security policies and procedures, including their
implementation across the Department.
12. DOE 5631.2C, PERSONNEL SECURITY PROGRAM, of 9-15-92, which establishes
policy, responsibilities, and authorities for implementing the DOE
Personnel Security Program.
13. DOE 5631.4A, CONTROL OF CLASSIFIED VISITS, of 7-8-92, which prescribes
DOE standards and procedures for controlling visitors to DOE, DOE
contractor, subcontractor, and access permittee facilities.
14. DOE 5634.1B, FACILITY APPROVAL, SECURITY SURVEYS, AND NUCLEAR MATERIALS
SURVEYS, of 9-15-92, which establishes DOE requirements for granting
facility approvals prior to permitting safeguards and security
interests on the premises and the conduct of on-site security and/or
nuclear material surveys.
15. DOE 5939.1, INFORMATION SECURITY PROGRAM, of 10-19-92, which
establishes the program, as a system of elements which serve to deter
collection activities.
16. DOE Acquisition Letter 92-2, of 3-4-92, which transferred
responsibility for making FOCI determinations to the DOE safeguards and
security office and established procedures for submission of FOCI
information.
DEFINITIONS
1. ACCESS. Refers to the following:
a. The knowledge, use, or possession of classified or other sensitive
information required by an individual to perform his/her official
duties that is provided to the individual on a need-to-know basis.
b. Situations that may provide an individual proximity to or control
over special nuclear material.
c. The ability and opportunity to obtain knowledge of classified
information. An individual, in fact, may have access to
classified information by being in a place where such information
is kept, if the security measures that are in force do not prevent
gaining knowledge of the classified information.
2. ACCESS AUTHORIZATION OR SECURITY CLEARANCE. An administrative
determination that an individual is eligible for access to classified
information or special nuclear material on a "need-to-know" basis.
Clearances granted by the Department are designated Q, L, Top Secret,
or Secret.
3. ALTERNATE CERTIFICATION OF NONAPPLICABILITY. A method to avoid
repeated submissions of comprehensive FOCI representations. If a
contractor and, if applicable, its tier parents have previously
received a FOCI determination from a DOE Headquarters or field
safeguards and security office within the past 5 years, the contractor
and its tier parents, if any, need not complete the FOCI
representations but instead shall complete the Alternate Certification
of Nonapplicability, as defined in DOE Acquisition Letter 92-2,
provided there have been no changes to the FOCI submission previously
filed with DOE pursuant to DEAR 952.204-73, including any changes in
the ownership or control of the contractor or its tier parents, if any.
4. AUTHORIZED OFFICIAL. A person authorized to represent and sign for an
offeror/bidder or contractor (e.g., a corporation--a person identified
in the Corporation's By-laws as responsible for managing the business
and affairs of the Corporation; a partnership--the managing or general
partner, etc.)
5. AUTHORIZED PERSON. A person who has a need-to-know for classified
information in the performance of official duties and who has been
granted the required security clearance.
6. CLASSIFIED INFORMATION. Certain information requiring protection
against unauthorized disclosure in the interests of national defense
and security or foreign relations of the United States pursuant to
Federal statute or Executive order. The term includes Restricted Data,
Formerly Restricted Data, and National Security Information. The
potential damage to the national security of each is denoted by the
classification levels Top Secret, Secret, or Confidential.
7. CLASSIFIED MATERIAL. Chemical compounds, metals, fabricated or
processed items, machinery, electronic equipment, and equipment or any
combination thereof that has been assigned a classification level and
classification category.
8. COMPROMISE. Disclosure of classified information to unauthorized
persons.
9. CONTRACTING OFFICER. A Government official who, in accordance with
Departmental procedures, currently is designated as a contracting
officer with the authority to enter into and administer contracts, and
make determinations and findings with respect thereto, or any part of
such authority. The term also includes the designated representative
of the contracting officer acting within the limits of his/her
authority.
10. CONTRACTOR. An entity or person who contracts directly or indirectly
to supply goods or services to the DOE.
11. CONTROL. The power, of any nature and by any means, direct or
indirect, whether exercised or exercisable, to prevail over matters
affecting the management or operations of the U.S. organization.
12. FACILITY. An educational institution, manufacturing plant, laboratory,
office building, or complex of buildings located on the same site that
is operated and protected as one unit by DOE or its contractor(s).
13. FACILITY APPROVAL. A determination that a facility (and/or activities
conducted within a facility) is eligible to receive, produce, use, or
store classified matter, nuclear materials, or DOE property of
significant monetary value.
14. FACILITY NATIONAL AGENCY CHECK. A national agency check of a facility
that includes a check of the Federal Bureau of Investigation, the DOD
Defense Central Index of Investigations, the DOD Personnel
Investigations Center, and other agencies as appropriate.
15. FIELD ELEMENT. A Departmental component located outside the Washington
Metropolitan area.
16. FOREIGN INTEREST. A foreign interest is defined as any of the
following:
a. Any foreign government, agency of a foreign government, or
representative of a foreign government;
b. Any form of business enterprise or legal entity organized under
the laws of any country other than the U.S. or its possessions;
c. Any person who is not a U.S. citizen or national of the U.S. (An
"intending citizen" and a foreign-owned U.S. company are excluded
from the definitions of a foreign interest).
17. FOREIGN NATIONAL. Any person who is not a U.S. citizen or a U.S.
national.
18. FOREIGN OWNERSHIP, CONTROL OR INFLUENCE (FOCI). FOCI exists when an
offeror/bidder or contractor proposing to performing work for DOE
involving access to classified information and/or a significant
quantity of SNM has an institutional or personal relationship with a
foreign interest(s). An offeror/bidder or contractor is considered to
be under FOCI when the degree of interest as defined above is such that
a reasonable basis exists for concluding that compromise of classified
information and/or a significant quantity of SNM may result.
19. LIMITED FACILITY CLEARANCE (FORMERLY "RECIPROCAL" CLEARANCE). A
mechanism used by DOD, but not DOE, through which foreign interests can
own U.S. defense companies. Limited Facility Clearances severely
restrict a company's access to classified information (e.g., not valid
for access to Top Secret information, Restricted Data, Formerly
Restricted Data, Communications Security information, Arms Control and
Disarmament Agency classified information, information that has not
been determined releasable by designated U.S. Government disclosure
authorities to the country from which the ownership is derived, etc.)
20. NOMINEE SHARE. A share of stock or registered bond certificate which
has been registered in a name other than the actual owner.
21. OPERATIONS OFFICE. The primary management and staff field element with
delegated responsibility for oversight and program management of major
facilities, programs, and operations. The following elements are
defined as DOE Operations Offices: Albuquerque, Chicago, Idaho,
Nevada, Oak Ridge, Richland, San Francisco, and Savannah River.
22. PARENT. A corporation or other entity that controls another
corporation or other entity by the power to elect its management.
23. PRINCIPAL OFFICERS. The term principal officer when used with
reference to this Order means those officials responsible for managing
the business and affairs of the organization (e.g., President, Chief
Executive Officer, Secretary, and Treasurer, and those occupying
similar positions).
24. PROCUREMENT REQUEST ORIGINATOR. The individual responsible for
initiating a requirement on DOE F 4200.33, "Procurement Request
Authorization."
25. PROXY. One who acts for another. Also, the document by which such a
representative is authorized to act. In reference to voting at a
meeting of corporation's stockholders, an authorization by a
stockholder giving to the corporate management (or to an opposition
group) the right to vote the shares held by the individual stockholder.
In most states the members of the board of directors cannot vote by
proxy.
26. REPRESENTATIVE OF FOREIGN INTEREST (RFI). A citizen or national of the
U.S., or an intending citizen to the U.S., who is acting as a
representative of a foreign interest.
27. REPRESENTATIVE OF FOREIGN INTEREST STATEMENT. (See "Representative of
Foreign Interest (RFI)"). A statement required to be submitted by the
contractor of an employee who possesses or is being processed for a DOE
security clearance who becomes an RFI or whose status as an RFI changes
in a manner that would make him/her ineligible for a security
clearance.
28. SAFEGUARDS AND SECURITY ACTIVITY. Any work performed under contract,
subcontract, or other agreement which involves access to classified
information, nuclear material, or DOE property of significant monetary
value by DOE, a DOE contractor, or any other activity under DOE
jurisdiction. Also included is the verification of the capabilities of
approved Federal locations.
29. SAFEGUARDS AND SECURITY INFORMATION MANAGEMENT SYSTEM (FORMERLY
SAFEGUARDS AND SECURITY ISSUES INFORMATION SYSTEM AND THE MASTER
FACILITY REGISTER). An automated system used to record facility
approvals, facility administrative information, inspection findings,
and corrective actions.
30. SERVICING SAFEGUARDS AND SECURITY OFFICE. The DOE Headquarters or
field safeguards and security office which is responsible for providing
support/assistance and implementation/oversight pertaining to security
requirements at a DOE organization.
31. SPECIAL NUCLEAR MATERIAL (SNM). Plutonium, uranium-233, or uranium
enriched in the isotope 235, and any other material which, pursuant to
the provisions of Section 51 of the Atomic Energy Act of 1954, as
amended, has been determined to be special nuclear material, but which
does not include source material; or it also includes any material
artificially enriched by any of the foregoing, not including source
material.
32. SPECIAL SECURITY AGREEMENT. A mechanism used by DOD, but not DOE,
through which foreign interests can own U.S. defense companies. A
Special Security Agreement restricts a company's access to the
following types of information unless DOD obtains approval from the
cognizant U.S. agency with jurisdiction over the information involved:
Top Secret information, Restricted Data, Formerly Restricted Data,
Communications Security information, Sensitive Compartmented
Information, and Special Access Program information.
33. TIER PARENT. A corporation or other entity that controls another
corporation or other entity by the power to elect its management. The
control may exist by direct ownership of the corporation or other
entity or by indirect ownership through one or more levels of ownership
of corporation(s) or other entity(ies).
34. UNAUTHORIZED DISCLOSURE. A communication or physical transfer of
classified information to an unauthorized recipient.
35. U.S. ORGANIZATION. Any individual, corporation, or organization
located in the U.S. or its territorial areas which is organized,
chartered, or incorporated under the laws of the U.S.
36. VOTING TRUST AGREEMENT. A legal device whereby the true owners of a
block of stock transfer nominal ownership to one or more disinterested
individuals which they are to keep, use, or administer for the
financial benefit of the owners. The true owners surrender all of the
normal prerogatives of management to the trustees.