Stay current on changes and developments in corporate law with a wide variety of resources and tools.
By Yin Wilczek
Dec. 1 — With a new law that came into force Dec. 1, the U.K. became the first country in the European Union to implement directives requiring companies to report the payments they make to governments to access natural resources worldwide.
The 2014 Reports on Payments to Governments Regulations, signed into law Nov. 28, require large and EU-listed oil, gas and mining companies incorporated in the U.K. to disclose annually the payments they make to governments on a country-by-country and project-by-project basis.
In the wake of the action, nongovernmental organizations are calling on authorities in other countries, including the Securities and Exchange Commission, to speed up their consideration of similar laws.
In a release, the Publish What You Pay coalition called the U.K. regulations a “major step” in the fight against global corruption.
In a similar release, Oxfam America faulted the SEC for delaying “multiple times” its own resource extraction disclosure rule.
An SEC representative declined to comment.
In September, Oxfam filed a lawsuit against the SEC for dragging its heels in implementing Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (29 CCW 290, 9/24/14). Under the provision, the commission must require the resource extractive industries to disclose payments made to governments to further the commercial development of oil, natural gas or minerals.
Last year, the U.S. District Court for the District of Columbia invalidated an SEC rule adopted in 2012, in response to a lawsuit brought by four trade groups, including the American Petroleum Institute (28 CCW 209, 7/10/13).
The SEC's latest regulatory flexibility agenda, published by the Office of Management and Budget's Office of Information and Regulatory Affairs in November, said the commission would issue a notice of proposed rulemaking under Section 1504 by October 2015. According to its spring 2014 regulatory flexibility agenda, the commission originally indicated that it anticipated proposing the rule by March 2015 (29 CCW 172, 6/4/14).
Under the new U.K. law, the first company reports—covering resource extraction payments made in 2015—will be published in 2016.
The British law is the first to implement the accounting portion of the EU's 2013 Accounting and Transparency Directives. All 28 members of the union must transpose the directives into domestic law by 2015. France, Germany and Finland are among other members considering national laws on the disclosure requirements.
According to statistics provided by Oxfam and PWYP, the EU requirements and the SEC's regulations, once finalized, would cover 65 percent of the value of resource extraction companies operating in the major capital markets. Once legislation under consideration in Canada is adopted, the resource extraction laws would cover 84 of the world's 100 largest oil and gas companies, and 58 of the world's 100 largest mining companies, the NGOs said.
To contact the reporter on this story: Yin Wilczek in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Ryan Tuck at email@example.com
A draft version of the 2014 Reports on Payments to Governments Regulations is available at http://www.legislation.gov.uk/ukdsi/2014/9780111122235/contents.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)