transparency about transparency October 25, 2011Posted by Bradley in : transparency , trackback
Announcing new proposed rules about transparency, Michel Barnier and Andris Piebalgs stated:
These new measures will improve sustainable business among multinationals active in the oil, gas, mining or logging sectors. It will play a groundbreaking role in the better management of natural resources and in the increase of domestic fiscal resources available to provide basic social services to the citizens. This new legislation will be a strong contribution to the Agenda for Change of European Development policy which aims at equipping Developing countries with the tools to foster sustainable and inclusive growth.
Today, the Commission establishes itself as an avant-garde in promoting transparency and goes well beyond the US Dodd-Frank act, putting the interests of developing countries at the forefront of this European domestic legislation. This will help to achieve a new step in the quality of our relations with Africa, based on mutual accountability and transparency.
Strange euro-English (establishes itself as an avant-garde). Moreover, the proposal for the directive does not seem to claim to be going well beyond Dodd-Frank (see, e.g., the SEC’s proposal for implementation):
This proposal is comparable to the US Dodd-Frank Act, which was adopted in July 2010, and requires extractive industry companies (oil, gas and mining companies) registered with the Securities and Exchange Commission governments on a country- and project-specific basis. The SEC’s implementing rules are scheduled to be adopted by the end of 2011.
The Extractive Industries Working Group has suggested that there is a risk that the implementation of the US rules will allow for failure to report. But it’s not obvious that the EU’s rules will be more effective.
Later: The EU FAQ explains that the EU rules are to apply to logging as well as to oil gas and mining and that “the EU rules would apply to large unlisted companies, as well as listed companies, whereas the US rules are restricted to listed extractive companies only”. In fact the US disclosure requirements will not just apply to listed companies but apply to public companies registered under the Exchange Act.