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As the International Board of the Extractive Industries Transparency Initiative (EITI) meets in Lusaka, Zambia this week to discuss the future of the initiative, the Publish What You Pay United States coalition takes the following position:
As EITI Civil Society Board Members head to Lusaka for these crucial negotiations on the future of the EITI, we are extremely disappointed that the American Petroleum Institute (API) along with the U.S. Chamber of Commerce and others, has filed a lawsuit against the United States Securities and Exchange Commission (SEC), seeking to overturn oil and mineral payment disclosure legislation, Section 1504 of the 2010 U.S. Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as its implementing regulations. Leading members of the API, including Chevron, ExxonMobil, Royal Dutch Shell, BP and Statoil currently serve as EITI International Board Members, and a large number of EITI Supporting Companies are API members. These EITI Board Members and Supporting Companies have made repeated public statements of support for transparency and the principles and objectives of EITI, and will play a leading role in Lusaka in the critical negotiations on the future of the EITI and its reporting standard through the formal EITI Strategy Review Process.
However, the legitimacy of the EITI Strategy Review Process, and the credibility of the EITI brand are jeopardized if the same companies negotiating EITI disclosure standards in Lusaka support a lawsuit that seeks to overturn U.S. payment disclosure legislation and regulation intended to strengthen the EITI standard.
Publish What You Pay United States calls on EITI International Board Members and EITI Supporting Companies that are also members of API, the U.S. Chamber of Commerce, the Independent Petroleum Association of America and the National Foreign Trade Council to:
We call on companies to make public their positions by Friday, October 26, 2012.
For more information contact: Isabel Munilla at imunilla (at) pwypusa.org.
Notes to Editors:
The lawsuit was filed by the American Petroleum Institute, the Chamber of Commerce of the United States of America, the Independent Petroleum Association of America and the National Foreign Trade Council against the U.S. Securities and Exchange Commission in the United States District Court for the District of Columbia on October 10, 2012.
- U.S. Congress Press Release: Cardin, Lugar Respond To Big Oil Challenge To Transparency Regulations
- Links to description of EITI Strategy Review Process, Proposals for improvements by Civil Society Board Members
The legislation that the American Petroleum Institute (API) and co-plaintiffs seek to overturn is Section 1504 of the 2010 U.S. Dodd-Frank Financial Reform Act, the so-called “Cardin-Lugar Provision”. The implementing regulations were released by the U.S. Securities and Exchange Commission on August 22, 2012. This anti-secrecy payment transparency legislation is unanimously supported by civil society groups from over 60 countries. It was crafted by the U.S., a country which has committed to implementing the EITI, and championed by President Obama to complement the EITI by producing data to strengthen existing EITI processes, and expand transparency for citizens in countries not currently enjoying the benefits of a national EITI process. There is consensus in the PWYP Global Coalition that the U.S. regulations, as well as similar rules under negotiation in Europe and under consideration in Canada, represent an essential contribution to achieving the core objectives of EITI and the broader extractives transparency movement.
In their lawsuit, API and its co-plaintiffs explicitly use the argument that EITI currently sets a very low standard as grounds to support their claim that U.S. transparency law and regulations are overreaching – at the same time, API member companies are participating in the EITI Strategy Review Process, designed to revisit and improve on EITI’s minimum requirements.
The lawsuit therefore represents significant risks to the EITI’s mission, the legitimacy of its multi-stakeholder process and the credibility of its brand. The lawsuit also threatens PWYP and other civil society efforts to expand transparency, compromising the scarce financial and human resources applied by civil society organizations on work to expand and strengthen the EITI. PWYP and its members, as founders of EITI, have invested significant financial and human resources into the EITI Strategy Review Process, to develop and propose detailed improvements to the standard for consideration and negotiation by the EITI International Board. These proposalswere put in writing, vetted with PWYP coalitions operating in 60 countries, and published on the PWYP and EITI websites. If implemented, these proposals, along with the implementation of Section 1504, would vastly improve the effectiveness and quality of this important initiative and lead to improved results.