March 19, 2013 / 10:26 AM / 5 years ago

EU set to agree oil, gas anti-corruption law

* Exemptions last major issue for EU talks

* U.S. appeals court to hear challenge to U.S. law this week

* Soros, France’s Hollande, Britain’s Clegg back rigour

By Barbara Lewis

BRUSSELS, March 19 (Reuters) - Europe appears set to agree rules forcing oil, gas and mining companies to declare payments to governments, as part of efforts to end poverty in resource-rich nations by ensuring the wealth is shared out.

EU officials say Tuesday’s round of negotiations on a legal text could be the last, but it is not yet clear whether the European Union’s rules will be as rigorous as U.S. legislation, which has led to a challenge through the courts.

Once a text has been decided, it will require endorsement from parliament and member states, which would be expected over the coming weeks.

On Friday, a U.S. appeals court will hear oral arguments in the case against regulator the Securities and Exchange Commission brought by industry body the American Petroleum Institute.

In Brussels, the last major sticking point is the issue of exemptions, which oil companies say are necessary to take account of the law in certain regimes in which they operate.

Campaign groups disagree.

“It’s essential the EU follows the U.S. and deletes any reference to exemptions,” Eloise Todd, Brussels director of anti-poverty group ONE, said.

“Any whiff of exemptions in these rules could open the door to corrupt regimes exempting oil companies from reporting the payments they make.”

Investor and philanthropist George Soros has also thrown his weight behind watertight requirements to ensure any payments are declared to regulatory authorities where firms are registered.

In a speech in February, he said investors stood to gain from disclosure because it made assessing risk in firms easier.

He voiced concern the Dutch government was under pressure from Anglo-Dutch oil company Royal Dutch Shell, prompting a stiff rebuttal.


President Director of Shell Nederland BV Dick Benschop issued a statement denying the firm was exerting pressure “to relax the rules”.

“Contrary to what Mr. Soros claims, some countries have national legislation actually prohibiting openness about the flow of funds,” his statement said, without naming the countries.

“The consequence is that companies like Shell will eventually be forced to elect to break the law somewhere in the world.”

If exemptions are the last major hold-out, another big debate in Europe has been the threshold for declaring payments.

EU sources, speaking on condition of anonymity, predicted the EU limit would be similar to the U.S. one. In votes in September, the European Parliament backed reporting from a minimum threshold of 80,000 euros ($104,500), almost identical to the $100,000 U.S. requirement.

It is much higher than the 15,000 euros some campaign groups say is enough to matter, but far below the million-dollar level some resource firms had said was practical.

Britain, France and the Netherlands, home to Europe’s biggest oil companies BP, Total and Royal Dutch Shell, have also offered support for tough requirements.

French President Francois Hollande in a speech in Kinshasa last October said France would push, at a European level, for publication “country by country, project by project, without exception”.

Britain’s Deputy Prime Minister Nick Clegg, also speaking in October, called for rules “similar to the high standards already introduced by the U.S.”

In the Netherlands, Bart Visser, a spokesman for the Dutch economic affairs ministry, said EU rules should be in line with the U.S. law.

“We don’t think exemptions should be made because we would like to create a level playing field for companies in Europe,” Visser said.

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below