EDGAR Part 85 Subpart B (Covered Transactions)
Subpart B_Covered Transactions
Sec. 85.200 What is a covered transaction?
A covered transaction is a nonprocurement or procurement transaction
that is subject to the prohibitions of this part. It may be a
transaction at--
(a) The primary tier, between a Federal agency and a person (see
appendix to this part); or
(b) A lower tier, between a participant in a covered transaction and
another person.
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
Sec. 85.205 Why is it important if a particular transaction is a
covered transaction?
The importance of a covered transaction depends upon who you are.
(a) As a participant in the transaction, you have the
responsibilities laid out in Subpart C of this part. Those include
responsibilities to the person or Federal agency at the next higher tier
from whom you received the transaction, if any. They also include
responsibilities if you subsequently enter into other covered
transactions with persons at the next lower tier.
(b) As a Federal official who enters into a primary tier
transaction, you have the responsibilities laid out in subpart D of this
part.
(c) As an excluded person, you may not be a participant or principal
in the transaction unless--
(1) The person who entered into the transaction with you allows you
to continue your involvement in a transaction that predates your
exclusion, as permitted under Sec. 85.310 or Sec. 85.415; or
(2) A(n) ED official obtains an exception from the ED Deciding
Official to allow you to be involved in the transaction, as permitted
under Sec. 85.120.
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
Sec. 85.210 Which nonprocurement transactions are covered
transactions?
All nonprocurement transactions, as defined in Sec. 85.970, are
covered transactions unless listed in Sec. 85.215. (See appendix to
this part.)
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
Sec. 85.215 Which nonprocurement transactions are not covered
transactions?
The following types of nonprocurement transactions are not covered
transactions:
(a) A direct award to--
(1) A foreign government or foreign governmental entity;
(2) A public international organization;
(3) An entity owned (in whole or in part) or controlled by a foreign
government; or
(4) Any other entity consisting wholly or partially of one or more
foreign governments or foreign governmental entities.
(b) A benefit to an individual as a personal entitlement without
regard to the individual's present responsibility (but benefits received
in an individual's business capacity are not excepted). For example, if
a person receives social security benefits under the Supplemental
Security Income provisions of the Social Security Act, 42 U.S.C. 1301 et
seq., those benefits are not covered transactions and, therefore, are
not affected if the person is excluded.
(c) Federal employment.
(d) A transaction that the Department of Education needs to respond
to a national or agency-recognized emergency or disaster.
(e) A permit, license, certificate, or similar instrument issued as
a means to regulate public health, safety, or the environment, unless
the Department of Education specifically designates it to be a covered
transaction.
(f) An incidental benefit that results from ordinary governmental
operations.
(g) Any other transaction if the application of an exclusion to the
transaction is prohibited by law.
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
Sec. 85.220 Are any procurement contracts included as covered
transactions?
(a) Covered transactions under this part--
(1) Do not include any procurement contracts awarded directly by a
Federal agency; but
(2) Do include some procurement contracts awarded by non-Federal
participants in nonprocurement covered transactions (see appendix to
this part).
(b) Specifically, a contract for goods or services is a covered
transaction if any of the following applies:
(1) The contract is awarded by a participant in a nonprocurement
transaction that is covered under Sec. 85.210, and the amount of the
contract is expected to equal or exceed $25,000.
(2) The contract requires the consent of a(n) ED official. In that
case, the contract, regardless of the amount, always is a covered
transaction, and it does not matter who awarded it. For example, it
could be a subcontract awarded by a contractor at a tier below a
nonprocurement transaction, as shown in the appendix to this part.
(3) The contract is for federally-required audit services.
(c) The contract is awarded by any contractor, subcontractor,
supplier, consultant or its agent or representative in any transaction,
regardless of tier, that is funded or authorized under ED programs and
is expected to equal or exceed $25,000.
(d) The contract is to perform services as a third party servicer in
connection with a title IV, HEA program.
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
Sec. 85.225 How do I know if a transaction in which I may participate
is a covered transaction?
As a participant in a transaction, you will know that it is a
covered transaction because the agency regulations governing the
transaction, the appropriate agency official, or participant at the next
higher tier who enters into the transaction with you, will tell you that
you must comply with applicable portions of this part.
Authority: E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O 12689 (3 CFR,
1989 Comp., p. 235); 20 U.S.C. 1082, 1094, 1221e-3 and 3474; and Sec.
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327.
EDGAR version June 23, 2005
