EU Pushes for Transparency for Oil, Mining Payments

Country: Europe
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Today’s European Parliament committee vote to require oil, gas and mining companies to disclose their payments to governments is a significant step toward creating a strong global transparency standard, the Revenue Watch Institute said.

"While we still need to see the full text of the proposal, the committee has taken a clear stance in favor of transparency in payments to governments by companies in this sector," said Daniel Kaufmann, Revenue Watch president. "The EU’s member states now have the opportunity to adopt a genuinely global transparency standard."

The European Parliament’s Legal Affairs Committee voted on amendments to the European Accounting and Transparency Directives, to require oil, gas, mining and forestry companies listed on EU stock exchanges as well as large private companies to disclose their payments to governments, country by country and for each project. The amendments are tightly written to compel disclosure of all payments of €80,000 or more, in all countries, from all companies, without exemption.

"Countries rich in oil and minerals need good governance to harness that wealth for the benefit of their citizens—and transparency by multinational firms will contribute to good governance in many countries and in the industry," Kaufmann said.

With its vote, the Legal Affairs Committee has moved to expand the reach of mandatory reporting requirements first established in the United States through the Dodd-Frank Act. Last month, to put the Dodd-Frank provisions into force, the U.S. Securities and Exchange Commission issued final rules for all oil, gas and mining companies listed on U.S. stock exchanges to make public their payments to governments.

European legislation would apply to hundreds of companies in 27 EU member states, including state-owned entities such as Lukoil and Gazprom, which are not covered by Dodd-Frank requirements.

Members of the European Parliament will now discuss the proposal with European Council members, before submitting a final version of the directive to the full parliament for a vote, anticipated early next year.

Background: Q&A on Dodd-Frank, SEC

Why Good Governance Matters

Transparency in Canada

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