DATE: April 1, 2002
SUBJECT: Department of Energy Acquisition Regulation (DEAR); Assessment of Civil Penalties for Classified Information Security Violations
SOURCE: Federal Register, April 1, 2002, Vol. 67, No. 62, page 15339
AGENCIES: Department of Energy (DOE)
ACTION: Notice of Proposed Rulemaking (NPRM) and Notice of Public Hearing
SYNOPSIS: DOE is proposing regulations to implement Section 234B of the Atomic Energy Act of 1954, which was added by Section 3147 of the National Defense Authorization Act for Fiscal Year 2000 (Public Law 106-65). Section 234B subjects contractors and others working for DOE to civil penalties for violations of DOE rules, regulations, and orders regarding the safeguarding and security of "Restricted Data" and other classified information.
EDITOR'S NOTE: For more on a recent revision of the DOE Acquisition Regulation (DEAR) to implement Executive Order 12829, National Industrial Security Program (NISP), see the March 28, 2002, FEDERAL CONTRACTS DISPATCH "Department of Energy Acquisition Regulation (DEAR); National Industrial Security Program."
DATES: Seven copies of comments are to be submitted no later than July 1, 2002. Public hearings will be held in Las Vegas, NV on May 22, 2002, from 9:30 a.m. until 12:30 p.m., and in Washington, DC on May 29, 2002, from 9:30 a.m. until 12:30 p.m. Requests to speak at the Las Vegas hearing must be submitted no later than May 15, 2002, and requests to speak at the Washington, DC hearing must be submitted no later than May 22, 2002. Requests to make oral presentations should contain a telephone number where the requester may be contacted prior to the hearing. Speakers are requested to submit seven copies of their statement to DOE at the hearings.
ADDRESSES: Address comments to Geralyn C. Praskievicz, Office of Security, SO-1, Docket No. SO-RM-00-01, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585.
The public hearings will be held at the U.S. Department of Energy, National Nuclear Security Administration, Nevada Operations Office, 232 Energy Way, Room A107, Las Vegas, NV, and at the U.S. Department of Energy, James Forrestal Building, 1000 Independence Avenue SW, Room GE-086, Washington, DC. DOE reserves the right to select the persons to be heard at the hearings, to schedule their respective presentations, and to establish the procedures governing the conduct of the hearings. The length of each presentation is limited to fifteen minutes. These will not be judicial-type hearings. Questions may be asked only by those conducting the hearing.
FOR FURTHER INFORMATION CONTACT: Geralyn Praskievicz, Office of Security, SO-1, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585, 202-586-4451; or Jo Ann Williams, Office of General Counsel, GC-53, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, DC 20585, 202-586-6899.
SUPPLEMENTAL INFORMATION: Subsection a. of new Section 234B of the Atomic Energy Act provides that any person who (1) has entered into a contract or agreement with DOE, or a subcontract or subagreement thereto, and (2) violates (or whose employee violates) any applicable rule, regulation, or order prescribed or otherwise issued by the secretary of energy in accordance with the Atomic Energy Act relating to the safeguarding or security of Restricted Data or other classified or "sensitive information" is be subject to a civil penalty not to exceed $100,000 for each such violation.
DOE is proposing to establish a new Part 824 in Title 10 of the Code of Federal Regulations (CFR) to implement Subsection a. and all other subsections of Section 234B of Section 234B of the Atomic Energy Act, (except Subsection b. -- see "EDITOR'S NOTE" below) with respect to contractors of DOE, including those of the National Nuclear Security Administration (NNSA) (which was established as an agency within DOE under Public Law 106-65). The following are the contents of the proposed 10 CFR 824, Procedural Rules for the Assessment of Civil Penalties For Classified Information Security Violations:
|824.1||Purpose and Scope|
|824.5||Notice of Violation|
|824.10||Rights of the Person at the Hearing|
|824.11||Conduct of the Hearing|
|824.15||Collection of Civil Fines|
The following explains the provisions of the three most significant provisions of 10 CFR Part 824:
Therefore, proposed Section 824.4 states that the "not to exceed $100,000" civil penalty will apply only for violations of: (1) specific DOE regulations related to classified information security presently in the CFR (10 CFR Part 1016, Safeguarding of Restricted Data; 10 CFR Part 1045, Nuclear Classification and Declassification; and 10 CFR Part 1046, Physical Protection of Security Interests); (2) "any other DOE rule, regulation or order related to the safeguarding or security of classified information that specifically indicates that violation of its provisions may result in a civil penalty pursuant to Subsection a. of Section 234B of the [Atomic Energy] Act; and (3) compliance orders issued by the secretary of energy in accordance with proposed paragraph (b) Section 824.4 ("if, without violating any regulation listed in paragraph (a) [above], a person by an act or omission jeopardizes the security of classified information, the secretary may issue a compliance order to that person requiring the person to take corrective action and notifying the person that violation of the compliance order is subject to a notice of violation and assessment of a civil penalty"). The regulations on compliance orders are modeled after a similar mechanism in 10 CFR Part 820, which are the regulations implementing procedures for Section 234A of the Atomic Energy Act of 1954 with respect to nuclear safety.
EDITOR'S NOTE: Subsection b. of Section 234B requires that each DOE contract contain provisions which provide an appropriate reduction in the fees or amounts paid to the contractor under the contract in the event of a violation by the contractor or contractor employee of any rule, regulation, or order relating to the safeguarding or security of Restricted Data or other classified or sensitive information.
On February 1, 2001, DOE published an NPRM to amend the DEAR to implement Subsection b. of Section 234B (see the February 1, 2001, FEDERAL CONTRACTS DISPATCH "Department of Energy Acquisition Regulation (DEAR); Conditional Payment of Fee, Profit, and Other Incentives"). Some of the commenters responding to that NPRM assumed that the procurement rulemaking was intended to address all of the provisions in Section 234B. The February 1, 2001, NPRM was only intended to address Subsection b. This April 1, 2002, NPRM addresses Subsection a. and all other subsections of Section 234B except Subsection b.
FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.
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