MEPs call for EU to clean up oil, mining industries

14.09.11 @ 09:29

  1. By Andrew Rettman
  2. Andrew email

The European Parliament has urged EU countries to clean up the mining and oil industries by publishing what companies pay to get their hands on contracts and by giving legal protection to whistleblowers.

  • Oil spill in Niger Delta - Nigeria is a byword for oil sector corruption and negligence (Photo: Sosialistisk Ungdom - SU)

The two reports - on financial transparency by German Green MEP Reinhard Butikofer and on safety standards by British Conservative Vicky Ford - were voted through in Strasbourg on Tuesday (13 September). Both texts are not legally binding but show which way the parliament wants the European Commission to go when it proposes new EU laws in the sector later this year.

The Butikofer report said the commission should: "Establish legally binding requirements for extractive companies to publish their revenue payments for each project and country they invest in, following the example of the US Dodd-Frank bill."

The US bill, which became law in 2010, forces all publicly-listed companies to disclose their payments to foreign governments.

The Butikofer text notes that EU firms have a bad track record of "violating environmental and labour standards and human rights" in developing countries. It adds that "EU companies should be legally liable in their home countries for any violation of human rights, environmental standards or ILO [International Labour Organisation] core labour standards by their subsidiaries abroad".

The Ford report is designed to prevent a repetition of the Deepwater Horizon oil spill, which flooded the Gulf of Mexico with oil and chemical dispersants last year.

It said: "Employees should be able to declare security failures or risks to competent authorities on an anonymous basis whilst being protected from harassment."

It also called for oil companies to draw up emergency plans for every offshore well they operate, to be held financially liable to an unlimited amount in the event of a spill and for the EU to keep a log of disaster-response assets which can be used if needed.

Ford declined to call for an EU-level oil industry regulator or to impose a moratorium on new drilling until new safety laws are in place. MEPs also rejected an amendment calling for a specific moratorium in the Arctic.

"There has been a suggestion that the EU should have a moratorium on exploration until new legislation is put in place, and a new EU-wide regulator. I believe neither is workable," she said after the vote. "A moratorium now could cause serious damage to our economic growth."

British left-wing MEP Peter Skinner, who put forward the whistleblower clause, noted: "If we are to prevent lethal accidents and disastrous oil spills, workers on rigs must be able to speak out".

For its part, a collection of pro-transparency NGOs called Publish What You Pay, welcomed the Butikofer paper.

"Secrecy in company payments for oil, gas and mineral resources has too often led to corruption, violence and civil war in many countries which are rich in natural resources", its director, Marinke van Riet, said in a written statement.

The Arab Spring has brought to the foreground EU oil industry co-operation with repressive regimes in the region.

EU countries on Tuesday reached political agreement on a set of top-up sanctions on Syria designed to stop EU companies such as Shell and Total from helping President Bashar Assad pump oil to export terminals, AFP reports. The EU earlier this month already imposed a ban on EU oil imports from Syria.

Looking to the future of Libya, British pro-transparency NGO Global Witness last month said: "Both the NTC [rebel leaders] and the Libya Contact Group [the league of anti-Gaddafi countries] have a responsibility to take all necessary steps to ensure that the people of Libya benefit fully from their country's wealth".