BP and Glencore among 10 condemned in report on tax secrecy

Source: Daily Telegraph
Date: 21 Sep 2021

The report by Publish What You Pay (PWYP), a pressure group campaigning for greater tax transparency, criticises the likes of BP and Glencore for deliberately using opaque subsidiaries “to facilitate illicit financial flows… to which the developing world loses US$1 trillion a year.”
In a study of 10 of the world’s biggest oil, gas and mining companies’ annual reports and stock exchange filings, PWYP reports that more than a third of these companies’ 6,038 subsidiaries are based in jurisdictions where accounts and ownership details are publicly unobtainable.
“By incorporating over a third of their subsidiaries in secrecy jurisdictions, the extractive industry is potentially complicit in suppressing economic and social opportunities for hundreds of millions of people living in least developed and emerging countries,” the report said.

While the report made clear that there was nothing illegal in these companies’ behaviour, it reasoned that, as a result, it is very difficult to hold politicians and the companies that extract oil, gas and minerals to account.
Locations used by the likes of BP and Glencore, and referred to as secrecy jurisdictions in the report, included the Netherlands, Ireland, Belgium and the US state of Delaware.

The report said: “The global extractive industry’s favourite place to incorporate is by far the US state of Delaware with 15.2 per cent of the subsidiaries located there.

“The second favourite extractive industry company (EIC) Secrecy Jurisdiction is the Netherlands, where 358 subsidiaries belonging to EI giants are based.”

A spokesman for BP said: “We have about 1,500 entities in BP’s corporate structure and believe that by the end of the year fewer than 40 will be located in what the Organisation for Economic Co-operation and Development (OECD) calls tax havens.”

A spokesman for Glencore said: “Glencore is a global business which operates across numerous jurisdictions. The company recently listed and provided all the disclosure required of a FTSE 100 company listed on London and Hong Kong and will continue to do so as well as those governing the regions in which it operates.

“Glencore recently published its first Sustainability Report where it stated its commitment to joining the EITI and providing a breakdown of its tax payments by region, in line with sector best practice.”

By Sean O’Hare

Daily Telegraph