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Transparency goes global!

It’s been quite the week for the Publish What You Pay campaign! In one fell swoop the number of countries having passed mandatory disclosure rules went from one to 28. Both Switzerland and Canada committed to adopting similar rules, while transparency was placed at the heart of the G8 summit, which took place this week in Lough Erne.

European Parliament votes for strong extractives transparency legislation

On 12 June, MEPs voted on the EU transparency and accounting directives, which will oblige listed (and large non-listed) extractive companies in any and all of the 27 EU member states to publish their payments to the governments where they operate.

The directives and their amendments were adopted by a huge majority. For MEP Arlene McCarthy, they represent ‘a major weapon in the global fight against corruption’.

Our national coordinators from Niger and DRC were in Strasbourg on the day of the vote to explain what this legislation means for their campaign.

For Jean-Claude in DRC, the ‘EU Directive will help lift the veil on payments so we can ensure they are spent for the public good’.
Revealing payments is crucial not only to ensure that governments have spent resource revenues responsibly, but also to make sure that they received a fair deal for their resources. As Ali, our coordinator from Niger pointed out, ‘between 14.5 and 21 billion Euros of potential revenue for Niger have been lost since 1960 because of unfair deals.’

Read PWYP’s press release on the vote

Meanwhile, that same morning in London…

Canadian Prime Minister Steven Harper announced that his government would also be adopting mandatory disclosure rules for extractive companies.

With one of the world’s largest extractive sectors, Canada has been an important target for the Publish What You Pay campaign. Central to PWYP Canada’s campaign has been the push for the Canadian government to adopt mandatory disclosure rules.

Canada is home to around 2000 extractive companies, many of whom operate in countries where citizens live in poverty, despite their country’s wealth in natural resources.

Kady Seguin, Interim Director of PWYP Canada stated, “Canada has sent a strong message to the rest of the world that transparency in the extractive sector is pivotal to ensuring the responsible and accountable management of natural resource revenues.”

Just two days later, the Resource Revenue Transparency Working Group shared its recommendations for what these rules should look like, which you can read about here.

Read PWYP Canada's press release here

Previously, in Switzerland

The day before, on 11 June 2013, the Swiss parliament approved a motion that calls on the government to draft extractive transparency rules similar to those of the EU and US.

These rules would not only cover extractive activities but also commodities trading, a crucial sector in Switzerland. In fact, almost half of global sales in this sector are done by companies who list Switzerland as their main place of business.

The Federal Council (the Swiss government's executive branch) will take this forward. Following the vote, Justice Minister Simonetta Sommaruga said that,

"The Federal Council accepts the proposal, as it is formulated, and will now consider transparency rules for the whole sector, meaning for listed and non-listed commodity companies as well as for commodity trading and extractive activities."

Read the Swissaid and the Berne declaration’s joint press release

and in Australia?

Last week’s successive transparency victories have placed the spotlight firmly on Australia. Australia is home to many extractive companies, particularly in mining, who operate all over the world. Almost half (45%) of companies on Australia’s stock exchange are extractive companies.

Although Australia launched a pilot EITI scheme in June 2012, there has been no commitment made to expand this to full implementation. PWYP Australia has also been calling on the government to adopt mandatory disclosure rules similar to those of the EU and the US.

As our PWYP Australia Coordinator, Claire Spoors said this week, 'Now that the EU has signed into law its disclosure requirements for extractive companies and Canada has committed to similar legislation, Australia is increasingly out of touch. All eyes are on Australia to catch up and the spotlight is only going to get more intense once the country takes on the G20 presidency at the end of the year. The Government has an opportunity in this role - if it moves quickly - to lead and encourage the major emerging economy markets to adopt disclosure requirements and help create a truly global transparency standard for the extractives sector.'

So, with the EU having now agreed mandatory disclosure rules, and Switzerland and Canada well into the fray – will Australia step up to the plate?

Companies out of touch...

However, some oil companies are still obstinately refusing to read the writing on the wall.

Earlier in May, Publish What You Pay wrote to Shell, Exxon, BP and Chevron calling on them to disassociate themselves from the lawsuit API is currently waging against Dodd-Frank 1504.

The response from companies was pretty disappointing and pretty 2011. They repeated their contradictory platform of stating support for transparency while at the same time undermining transparency legislation.

Visit our site  to view the responses.

Rio Tinto in support of global transparency

Other extractive companies, however, have been embracing transparency and change. Speaking at the pre-G8 summit event last yesterday (Open for Growth – GTTT), Sam Walsh, CEO of Rio Tinto, emphasised the need to expand the circles of companies and countries implementing extractive transparency measures.

He called for a global reporting standard and for Australia to look at implementing disclosure measures, as well as mentioning other countries with important stock exchanges such as South Africa and India.

Read Mr Walsh's speech notes here.

Pre-summit event – transparency at heart of G8 agenda

On June 15, a pre- G8 summit event took place in London, ‘Open for Growth: The G8 Trade, Tax and Transparency Event’.


For a great overview of the event, check out Matteo Pellegrini’s blog. 

The first few paragraphs are below:

This past weekend, I participated in the “Open for Growth” event organized by the UK government ahead of the G8 summit in Northern Ireland. The event, known as the “G8TTT,” was an opportunity to illustrate and debate the UK’s G8 agenda for international growth, prosperity and economic development, including advancing Trade, ensuring Tax compliance and promoting greater Transparency.

The meeting brought together hundreds of representatives from business, civil society and governments to discuss how to collaborate to promote and practice fairer trade, proper taxes and more transparency in data, oil, gas, minerals and land investment.
Britain’s Prime Minister David Cameron opened the event, making the case that aid alone cannot end poverty: “Poverty eradication requires that developing countries get the revenues and the benefits of growth that are rightfully theirs. And three vital things are needed to make that happen: fairer taxes, greater transparency and more trade.” (Full speech available here.)

Conversely, he stated that bad governance and corruption destroy lives and made a commitment not to provide aid to notoriously corrupt regimes, using Equatorial Guinea  as an example. He also reiterated the need to scale up support to those countries and governments making genuine efforts to address corruption but lacking the capacity and systems to harness the benefits of extractive industries. He singled out Guinea Conakry as one country pushing for bold reforms…

read the rest of the blog online

Publish What You Pay pre-G8 summit statement

Publish What You Pay released a statement prior to this event, which you can read in full here The first few paras are below…

Publish What You Pay has nine priorities for the extractive sector and the G8 process:

  1. Governments, companies and civil society should work together to secure and extend the new global transparency standard requiring mandatory company reporting of payments to governments, country-by-country and project-by-project, to create a global level playing field. Companies should commit not to seek exemptions from existing requirements to report for all projects in all countries where they operate. Governments should commit to enact similar legislation where they have not yet done so. 
  2. All parties should support the new EITI standard and encourage other countries and companies to sign up to and support the EITI. The EITI needs to be further enhanced by requiring full beneficial ownership and contract transparency.
  3. G8 countries and their tax havens should commit to put beneficial ownership information of companies into the public domain, and companies should agree to support this. Any action plans on beneficial ownership that the G8 countries produce should be made public.

… read the rest of the priorities online

What did we think of the outcomes of the G8 summit?

You can read the official G8 summit declaration and communique here.

Our PWYP UK Coordinator Miles Litvinoff gave the G8 summit a score of 5 out of 9 in a blog following the end of summit.

The first paragraph reads...

This week’s UK-chaired G8 Summit from Lough Erne, Northern Ireland, rounded off an extraordinary few weeks during which the UK and France committed to become EITI candidate countries, the European Parliament adopted mandatory extractive industry reporting in line with US legislation, and Canada committed to implement similar reporting requirements.

read the rest of the blog online

What should contract transparency look like?

The campaign for contract disclosure in Mozambique

The Mozambican government voted in support of contract transparency being included within EITI. However, when it comes to drafting its national laws, its transparency targets seem less ambitious.

CIP (Centre for Public Integrity), PWYP member in Mozambique, has argued that the draft for the mining and petroleum laws, as it stands, does not allow for full contract disclosure.

The wording of the law implies that many important details of the contracts will not be published. Moreover, the law makes reference to the publication of the ‘main terms’ of the contract. This is problematic, as important provisions which affect the core terms of a contract can be housed in the annexes or supplement contracts.

In short, CIP argues that for contract transparency to be complete and effective:

  • Disclosure means publishing the actual contract (the full text and scanned copies of each page)
  • Publishing the principal terms is insufficient
  • Annexes and supplementary contracts must be included
  • No exemptions for commercial confidentiality are needed
  • Contracts should be available on a single government website

Open Oil and CIP drafted an open letter  to the Mozambican Minister of Resources, Esperanca Bias. In it, they listed a series of ‘questions (indicative not exhaustive) that [they] consider vital to fully understanding the implications of these EPCC contracts for government revenue’. They also highlighted the fact that contract disclosure, as it stands in the current draft laws, is incomplete.

There have been significant natural resource discoveries in Mozambique over the past few years, discoveries which could change the lives of millions if managed properly. Yet, without contract transparency, it will be difficult for all Mozambicans to profit from their natural resources.

As CIP commented, ‘A brief window exists to convince the government of Mozambique that they should stand by their commitment to transparency. There is no need to hide behind secret contracts. The future well¬being of average Mozambicans is at stake.’

In brief

We have launched our microsite, ‘extracting the truth’. The site houses all our strategy documents in an easy to read format. You can explore it here

The Guardian created an interactive map to explore what transparency means to campaigners. Visit it to read the interview with our very own Faith Nwadishi, PWYP Nigeria Coordinator!

Application’s for Revenue Watch’s Annual Summer School on the Governance of Oil, Gas and Mining Revenues (Africa Knowledge Hub) – now open!

Open Society Foundation launched a transparency champions project

PWYP members wrote a letter to the Times, calling out Big Oil for their hypocritical stance on transparency