Commission giving up on transparency and giving in to industry lobbyists?
The debate about ensuring the EU addresses problems of corruption and mismanagement in the natural resources sector is heating up. The Confederation of Bishops, former BP head Lord Brown and US senators support strong EU legislation requiring EU-listed companies and non-listed large companies in the extractive sector to disclose their tax and revenue payments to governments worldwide. At issue is the European Commission proposal1 amending the EU Transparency and Accounting Directives. The proposal requires all large and EU-listed companies to report payments for each project.
16th May 2012
Effectively implemented, this would provide citizens of developing countries, investors, and civil society accurate, timely information about revenues to their governments from the oil, gas, mining and timber industries. The sums involved are vast: Africa’s income from extractive industries is six times greater than its income from aid. Such legislation could improve millions of lives.
Yet to be effective, the minimum threshold for reporting payments must be set at a meaningful level and no exemptions should be tolerated where national law ‘prohibits’ disclosure of such data. These two significant loopholes would undermine the purpose of the legislation (FW 165).
Industry lobbyists seem to be watering down the proposal: the Commission has introduced an ‘exemption clause,’ and EU Member States have raised concerns about project-level reporting which, they argue, would damage competitiveness and make ‘administrative’ costs of disclosure too great.
The PWYP2 coalition and others dismiss such arguments.3 The Bishops state “Multinational companies deprive developing countries of nearly 125 billion Euros each year. We … call on the EU to stop this now.”4 Without information by project, “Communities living near projects would be unable to determine how much wealth is generated nearby and where it ends up.”5
Only by closing loopholes and adopting meaningful thresholds for disclosure can Burmese, Congolese, or EU citizens hold governments accountable for the use of funds coming from extractive activities. The PWYP coalition, including FERN, urge the European Council and Parliament to stand up to industry lobbyists; strengthen the Commission proposal by eliminating reporting exemptions for any country and requiring reporting by project. The Legal Affairs committee will finalise its legislative proposals in June; the Council will issue conclusions this summer. Parliament votes on the legislation on 10 September 2012.
MORE on this in the FERN Newsletter below...
|May 16, 2012-FERN News Letter|
|[Forest Watch] May 2012 - Issue 171.pdf (143.67 KB)|