D.  Consequences of the Rule

Comment: Two respondents suggested that the rule may have several adverse effects, including deterring: (1) Small companies from competing for Government contracts; (2) contractors from hiring "covered DoD officials;" and (3) Federal employees who would be subject to the rule from seeking employment with DoD.

Response: This rule requires offerors to verify compliance with existing laws and regulations and, therefore, is unlikely to have the suggested deterrent effects unless the business was not otherwise ensuring compliance and/or did not intend to comply in the future. In that event, deterring non-compliance is consistent with the purposes underlying the rule. Further, to the extent one of the respondents was suggesting that small business concerns be exempted from the rule, such an exemption would substantially undermine its purpose of improving compliance, as available data indicates that small business concerns are likely to hire a large majority of "covered DoD officials" (see Regulatory Flexibility Act section).