The recently approved ‘‘Dodd-Frank Wall Street Reform and Consumer Protection Act’’… includes in SEC. 1504. Disclosure of Payments by Resource Extraction Issuers, a rule, sponsored by Senators Benjamin Cardin and Richard Lugar, which obliges US-listed companies engaged in oil, gas or minerals extraction anywhere in the world to report how much they pay to governments in their annual filing to the Securities and Exchange Commission. To be able to access the US capital market, companies - US and foreign - must publicly disclose all royalties, taxes, and other payments, project by project and country by country.
Since I am for transparency I see nothing wrong with that. In fact, as a citizen of an oil cursed country, Venezuela, I obtained the crucial information I needed on some of its investments only because its oil company, PDVSA, had to file that information with the SEC. (And that was even before the hugo chávez’ years).
BUT, according to this Act, those payments as determined by the Commission should be “consistent with the guidelines of the Extractive Industries Transparency Initiative (to the extent practicable)”, AND the Extractive Industries Transparency Initiative (EITI), for reasons that are unexplained, specifically states as its 2nd Principle the following:
BUT, according to this Act, those payments as determined by the Commission should be “consistent with the guidelines of the Extractive Industries Transparency Initiative (to the extent practicable)”, AND the Extractive Industries Transparency Initiative (EITI), for reasons that are unexplained, specifically states as its 2nd Principle the following:
“We affirm that management of natural resource wealth for the benefit of a country’s citizens is in the domain of sovereign governments to be exercised in the interests of their national development.”
Which, as I read it, means that the US Congress, though most of the oil in the US has been exploited by the private sector, and it adheres to free market principles, is lending credibility to an organization that is lending credibility to the notion that oil revenues should be managed by authoritarian petrocrats and oilygarchs like hugo chávez.
That does not make it easier for those who like me are fighting for the sharing of the oil net income directly with the citizens of a country, as the single most important factor that could help to diminish the negative consequences of the oil-curse.
Besides EITI is little by little becoming just another Basel Committee, monopolizing the rulemaking and the debate, without anyone outside comprehending sufficiently where their globally reaching authority really springs from.
