United States Applauds Securities and Exchange Commission’s Commitment to Swiftly Release Oil Transparency Rule
SEC Will Meet to Implement Landmark Oil, Gas, and Mining Transparency Law by June 2016
Publish What You Pay – United States (PWYP-US) welcomes today’s commitment by the Securities and Exchange Commission to quickly finalize a rule for Section 1504 of the Dodd-Frank Act, a groundbreaking oil, gas and mining transparency law.
The SEC’s announcement is in response to a court order requiring the SEC to issue an “expedited schedule” for the release of a final rule for Section 1504. In September 2014, Oxfam America sued the SEC for unlawfully withholding the rule. In September 2015, the US District Court for the District of Massachusetts sided with Oxfam and ordered the SEC to move forward with the rulemaking. In this new timeline, the SEC commits to issuing a proposed rule by the end of 2015 and meeting to adopt a final rule by June 2016. The District Court has stated that it will be monitoring the Commission’s progress.
“Five years after this landmark transparency law was passed, it remains unimplemented,” said Jana Morgan, Director of Publish What You Pay – United States. “We are encouraged by the SEC’s commitment to expeditiously release a rule and look forward to working with the Commission to ensure they produce a strong rule that will give investors access to critical information to better assess and mitigate their investment risks, as well as provide communities in resource rich countries the data necessary to hold their governments to account for the management of their natural resources.”
Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law in 2010 and requires oil, gas and mining companies listed on a US stock exchange to publish the payments they make to governments for access to natural resources.
The Securities and Exchange Commission first released an implementing rule for Section 1504 in August 2012. Following a lawsuit by the American Petroleum Institute, an oil industry trade association, the rule was vacated on narrow procedural grounds and returned to the SEC in July 2013 to be re-written.
With strong mandatory payment disclosure laws already in effect in Canada, Norway and the European Union, the Securities and Exchange Commission faces even greater pressure to release a robust rule aligned with the international standard. The new rule for Section 1504 must require public, project-level reporting, by company, with no exemptions, in order to ensure harmonization across jurisdictions, and prevent cross-listed companies from having to comply with burdensome dual reporting requirements.
“A global transparency standard has emerged, providing the SEC with a clear path forward,” said Morgan. “The SEC has received input from investors, academics, industry and civil society groups calling for a rule in line with the global standard. The SEC must now stick to its commitment and allow the US to reclaim its position as a leader in the fight against corruption and mismanagement in the extractive sector.”
Notes to Editors:
More information about Oxfam America’s lawsuit against the SEC is available here:
See below for recent letters from civil society groups around the world detailing how they will use project-level payment information to push for greater corporate and government accountability:
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-60.pdf (Angola)
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-64.pdf (Indonesia)
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-61.pdf (Sierra Leone)
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-63.pdf (Zimbabwe)
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-68.pdf (Democratic Republic of Congo)
- http://www.sec.gov/comments/df-title-xv/resource-extraction-issuers/resourceextractionissuers-71.pdf (Uganda)
Contact: Jana Morgan, Director – [email protected]
(202) 496-1189 office — (703) 795-8542 mobile