[Federal Register Volume 88, Number 77 (Friday, April 21, 2023)]
[Rules and Regulations]
[Pages 24477-24480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-08468]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 310

[Docket ID: DoD-2022-OS-0066]
RIN 0790-AL08


Privacy Act of 1974; Implementation

AGENCY: Office of the Secretary of Defense (OSD), Department of Defense 
(DoD).

ACTION: Final rule.

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SUMMARY: The Department of Defense (Department or DoD) is issuing a 
final rule to amend its regulations to exempt

[[Page 24478]]

portions of the system of records titled DoD-0010, 
``Counterintelligence Functional Services'' from certain provisions of 
the Privacy Act of 1974 because of national security, law enforcement, 
and employment suitability mission areas.

DATES: This rule is effective on May 22, 2023.

FOR FURTHER INFORMATION CONTACT: Ms. Rahwa Keleta, Privacy and Civil 
Liberties Division, Directorate for Privacy, Civil Liberties and 
Freedom of Information, Office of the Assistant to the Secretary of 
Defense for Privacy, Civil Liberties, and Transparency, Department of 
Defense, 4800 Mark Center Drive, Mailbox #24, Suite 08D09, Alexandria, 
VA 22350-1700; [email protected]; (703) 571-0070.

SUPPLEMENTARY INFORMATION:

Discussion of Comments and Changes

    This proposed rule published in the Federal Register (87 FR 37774) 
on June 24, 2022. Comments were accepted for 60 days until August 23, 
2022. No comments were received.

I. Background

    In finalizing this rule, DoD is exempting portions of this system 
of records titled DoD-0010, ``Counterintelligence Functional 
Services,'' from certain provisions of the Privacy Act. This system of 
records covers DoD's maintenance of records about individuals to 
protect against espionage, intelligence activities, sabotage, or 
assassinations conducted by foreign entities or international 
terrorists. Counterintelligence Functional Services (CIFS) activities 
support the following Counterintelligence (CI) missions: countering 
espionage; countering international terrorism; and providing support to 
force protection, research, development, and acquisition activities. 
CIFS also include assessments of CI incidents and DoD-required CI 
reporting conducted throughout the DoD enterprise. Not included in this 
system of records are records concerning CI investigations or CI 
collection activities.

II. Privacy Exemption

    The Privacy Act permits Federal agencies to exempt eligible records 
in a system of records from certain provisions of the Act, including 
the provisions providing individuals with a right to request access to 
and amendment of their own records and accountings of disclosures of 
such records. If an agency intends to exempt a particular system of 
records, it must first go through the rulemaking process to provide 
public notice and an opportunity to comment on the proposed exemption. 
The DoD is amending 32 CFR part 310 to add a new Privacy Act exemption 
rule for this system of records. The DoD is adding an exemption for 
this system of records because some of its records may contain 
investigatory material compiled for classified national security 
information; law enforcement purposes; and employment suitability 
determinations pursuant to 5 U.S.C. 552a(k)(1), (k)(2), and (k)(5). The 
DoD is claiming an exemption from several provisions of the Privacy 
Act, including various access, amendment, disclosure of accounting, and 
certain recordkeeping and notice requirements, to avoid, among other 
harms, frustrating the underlying purposes for which the information 
was gathered.

Regulatory Analysis

Executive Order 12866, ``Regulatory Planning and Review'' and Executive 
Order 13563, ``Improving Regulation and Regulatory Review''

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distribute impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. It has been determined that this rule is not a significant 
regulatory action under these Executive Orders.

Congressional Review Act (5 U.S.C. 804(2))

    The Congressional Review Act, 5 U.S.C. 801 et seq., generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. DoD will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States. A 
major rule may take effect no earlier than 60 calendar days after 
Congress receives the rule report or the rule is published in the 
Federal Register, whichever is later. This rule is not a ``major rule'' 
as defined by 5 U.S.C. 804(2).

Section 202, Public Law 104-4, ``Unfunded Mandates Reform Act''

    Section 202(a) of the Unfunded Mandates Reform Act of 1995 (UMRA) 
(2 U.S.C. 1532(a)) requires agencies to assess anticipated costs and 
benefits before issuing any rule whose mandates may result in the 
expenditure by State, local, and Tribal governments in the aggregate, 
or by the private sector, in any one year of $100 million in 1995 
dollars, updated annually for inflation. This rule will not mandate any 
requirements for State, local, or Tribal governments, nor will it 
affect private sector costs.

Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. 601 et 
seq.)

    The Assistant to the Secretary of Defense for Privacy, Civil 
Liberties, and Transparency has certified that this rule is not subject 
to the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) because it 
would not, if promulgated, have a significant economic impact on a 
substantial number of small entities. This rule is concerned only with 
the administration of Privacy Act systems of records within the DoD. 
Therefore, the Regulatory Flexibility Act, as amended, does not require 
DoD to prepare a regulatory flexibility analysis.

Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. 3501 et seq.)

    The Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.) was 
enacted to minimize the paperwork burden for individuals; small 
businesses; educational and nonprofit institutions; Federal 
contractors; State, local, and Tribal governments; and other persons 
resulting from the collection of information by or for the Federal 
Government. The Act requires agencies obtain approval from the Office 
of Management and Budget before using identical questions to collect 
information from ten or more persons. This rule does not impose 
reporting or recordkeeping requirements on the public.

Executive Order 13132, ``Federalism''

    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has federalism implications. This rule will not have 
a substantial effect on State and local governments.

[[Page 24479]]

Executive Order 13175, ``Consultation and Coordination With Indian 
Tribal Governments''

    Executive Order 13175 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct compliance costs on one or more Indian tribes, preempts Tribal 
law, or affects the distribution of power and responsibilities between 
the Federal Government and Indian Tribes. This rule will not have a 
substantial effect on Indian Tribal governments.

List of Subjects in 32 CFR Part 310

    Privacy.

    Accordingly, 32 CFR part 310 is amended as follows:

PART 310--PROTECTION OF PRIVACY AND ACCESS TO AND AMENDEMENT OF 
INDIVIDUAL RECORDS UNDER THE PRIVACY ACT OF 1974

0
1. The authority citation for part 310 continues to read as follows:

    Authority:  5 U.S.C. 552a.


0
2. Section 310.13 is amended by adding paragraph (e)(8) to read as 
follows:


Sec.  310.13   Exemptions for DoD-wide systems.

* * * * *
    (e) * * *
    (8) System identifier and name. DoD-0010, ``Counterintelligence 
Functional Services''
    (i) Exemptions. This system of records is exempt from 5 U.S.C. 
552a(c)(3); (d)(1), (2), (3), and (4); (e)(1); (e)(4)(G), (H), and (I); 
and (f) of the Privacy Act.
    (ii) Authority. 5 U.S.C. 552a(k)(1), (k)(2), and (k)(5).
    (iii) Exemption from the particular subsections. Exemption from the 
particular subsections is justified for the following reasons:
    (A) Subsections (c)(3), (d)(1), and (d)(2)--(1) Exemption (k)(1). 
Records in this system of records may contain information concerning 
individuals that is properly classified pursuant to executive order. 
Application of exemption (k)(1) for such records may be necessary 
because access to and amendment of the records, or release of the 
accounting of disclosures for such records, could reveal classified 
information. Disclosure of classified records to an individual may 
cause damage to national security.
    (2) Exemption (k)(2). Records in this system of records may contain 
investigatory material compiled for law enforcement purposes other than 
material within the scope of 5 U.S.C. 552a(j)(2). Application of 
exemption (k)(2) may be necessary because access to, amendment of, or 
release of the accounting of disclosures of such records could: inform 
the record subject of an investigation of the existence, nature, or 
scope of an actual or potential law enforcement or disciplinary 
investigation, and thereby seriously impede law enforcement or 
prosecutorial efforts by permitting the record subject and other 
persons to whom he might disclose the records or the accounting of 
records to avoid criminal penalties, civil remedies, or disciplinary 
measures; interfere with a civil or administrative action or 
investigation by allowing the subject to tamper with witnesses or 
evidence, and to avoid detection or apprehension, which may undermine 
the entire investigatory process; reveal confidential sources who might 
not have otherwise come forward to assist in an investigation and 
thereby hinder DoD's ability to obtain information from future 
confidential sources; and result in an unwarranted invasion of the 
privacy of others. Amendment of such records could also impose a highly 
impracticable administrative burden by requiring investigations to be 
continuously reinvestigated.
    (3) Exemption (k)(5). Records in this system of records may contain 
information concerning investigatory material compiled solely for 
determining suitability, eligibility, and qualifications for Federal 
civilian employment, military service, Federal contracts, or access to 
classified information. In some cases, such records may contain 
information pertaining to the identity of a source who furnished 
information to the Government under an express promise the source's 
identity would be held in confidence (or prior to the effective date of 
the Privacy Act, under an implied promise). Application of exemption 
(k)(5) may be necessary because access to, amendment of, or release of 
the accounting of disclosures of such records could identify these 
confidential sources who might not have otherwise come forward to 
assist the Government; hinder the Government's ability to obtain 
information from future confidential sources; and result in an 
unwarranted invasion of the privacy of others. Amendment of such 
records could also impose a highly impracticable administrative burden 
by requiring investigations to be continuously reinvestigated.
    (B) Subsections (d)(3) and (4). These subsections are inapplicable 
to the extent an exemption is claimed from subsections (d)(1) and (2).
    (C) Subsection (e)(1). In the collection of information for 
investigatory or law enforcement purposes, it is not always possible to 
conclusively determine the relevance and necessity of particular 
information in the early stages of the investigation or adjudication. 
In some instances, it will be only after the collected information is 
evaluated in light of other information that its relevance and 
necessity for effective investigation and adjudication can be assessed. 
Collection of such information permits more informed decision-making by 
the Department when making required suitability, eligibility, fitness, 
and credentialing determinations. Accordingly, application of 
exemptions (k)(1), (k)(2), and (k)(5) may be necessary.
    (D) Subsections (e)(4)(G) and (H). These subsections are 
inapplicable to the extent exemption is claimed from subsections (d)(1) 
and (2). Because portions of this system are exempt from the individual 
access and amendment provisions of subsection (d) forthe reasons noted 
above, DoD is not required to establish requirements, rules, or 
procedures with respect to such access or amendment provisions. 
Providing notice to individuals with respect to the existence of 
records pertaining to them in the system of records or otherwise 
setting up procedures pursuant to which individuals may access,view, 
and seek to amend records pertaining to themselves in the system would 
potentially reveal classified information, undermine investigative 
efforts, reveal the identities of witnesses, potential witnesses, and 
confidential informants, and impose an undue administrative burden by 
requiring investigations to be continually reinvestigated. Accordingly, 
application of exemptions (k)(1), (k)(2), and (k)(5) may be necessary.
    (E) Subsection (e)(4)(I). To the extent that this provision is 
construed to require more detailed disclosure than the broad, general 
information currently published in the system notice concerning the 
categories of sources of the records in the system, an exemption from 
this provision is necessary to protect classified information, other 
national security information, and the confidentiality of national 
security, law enforcement, and investigatory sources of information, 
and to protect the privacy and physical safety of witnesses and 
informants. Accordingly, application of exemptions (k)(1), (k)(2) and 
(k)(5) may be necessary.
    (F) Subsection (f). The agency's rules are inapplicable to those 
portions of the system that are exempt. Accordingly,

[[Page 24480]]

application of exemptions (k)(1), (k)(2), and (k)(5) may be necessary.
    (iv) Exempt records from other systems. In the course of carrying 
out the overall purpose for this system, exempt records from other 
systems of records may in turn become part of the records maintained in 
this system. To the extent that copies of exempt records from those 
other systems of records are maintained in this system, the DoD claims 
the same exemptions for the records from those other systems that are 
entered into this system, as claimed for the prior system(s) of which 
they are a part, provided the reason for the exemption remains valid 
and necessary.
* * * * *

    Dated: April 18, 2023.
Aaron T. Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2023-08468 Filed 4-20-23; 8:45 am]
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