Sunday

23rd Feb 2020

EU to agree transparency rules for oil and mining firms

  • Oil and mineral companies will have to report payments to governments (Photo: ezioman)

EU officials will meet Tuesday evening (9 April) for what are expected to be the final talks on radical new rules cracking down on corruption between extractive companies and third world governments.

Under the deal brokered between MEPs and ministers on the Accounting and Transparency directives, all large publicly listed and non-listed extractive companies would be required to declare all payments to and from governments over €100,000 on a country-by-country basis.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or join as a group

The payments, which will also cover a range of payments in kind such as preferential tax rates and the free use of buildings, would have to be published for each individual project.

Under the final compromise text, “projects" are defined as "operational activities that are governed by a single contract, license, lease, concession or similar legal agreements and form the basis for payment liabilities with a government."

The project definition is regarded as a victory for MEPs - documents seen by this website indicate that the French and UK governments attempted to water down the definition of a project at various stages in the negotiations.

The actions of multi-nationals in the extractive and logging industries are an emotionally charged issue.

EU lawmakers emphasised the need to put an end to the so-called "resource curse" - whereby countries have remained poor despite being rich in natural and mineral resources due, in part, to high-level corruption.

The negotiations have also seen a concerted lobbying campaign by extractive and oil companies to water down the effects of legislation.

Lawmakers also rejected proposals seeking to exempt companies from reporting requirements if disclosure of the material involves breaking the criminal law in the host country.

The "criminal exemptions" amendment, which was pushed in Council by a handful of countries led by Italy, Spain and Hungary, was widely seen by transparency campaigners as a loophole that could be used by companies and governments to avoid disclosure.

But a Council source told EUobserver that "no evidence has materialised that there are any examples of criminal exemption laws" in any extractive host country they looked at.

British Labour MEP Arlene McCarthy, who has led the parliament's negotiating team on the bills together with legal affairs committee chairman Klaus Hehne-Lehne, a German centre-right deputy, told this website that industry lobbyists had "failed to make a convincing case" for the exemptions.

"It's unclear why they have been seeking to water down rules for a robust reporting system and for exemptions when industry has failed to provide evidence of countries where such disclosure is a criminal offence or illegal," she added.

That said, governments are expected to block a proposal supported by MEPs to extend the scope of the legislation to cover the communications sector and construction.

Meanwhile, the European Commission will also be expected to review the new regime by 2016.

Although the Irish presidency is confident that an overall deal will be struck, unanimous agreement among member states is unlikely.

A Council source indicated that at least one country plans to oppose the deal over the removal of the criminal exemptions clause, while others are unhappy with the proposed revisions to accounting rules.

No breakthrough at EU budget summit

EU leaders failed to reach agreement on the EU's long-term budget, as richer states and poorer 'cohesion countries' locked horns. The impasse continues over how to fund the Brexit gap.

News in Brief

  1. Bulgarian PM investigated over 'money laundering'
  2. Greenpeace breaks into French nuclear plant
  3. Germany increases police presence after shootings
  4. NGO: US and EU 'watering-down' tax reform prior to G20
  5. Iran: parliamentary elections, conservatives likely to win
  6. Belgian CEOs raise alarm on political crisis
  7. Germans voice anger on rise of far-right terrorism
  8. EU leaders' budget summit drags on overnight

German ex-commissioner Oettinger lands Orban job

Hungary's PM Viktor Orban appointed controversial former commissioner Guenther Oettinger to a government council in a way that might break EU rules. Oettinger claims he did not know about the appointment.

Opinion

Why Miroslav Lajčák is the wrong choice for EU envoy

The EU could blow up the Kosovo-Serbia negotiations' reset. Should Miroslav Lajčák indeed be appointed, the two senior EU diplomats dealing with Kosovo would both come from the small minority of member states that do not recognise Kosovo.

Stakeholders' Highlights

  1. Nordic Council of MinistersScottish parliament seeks closer collaboration with the Nordic Council
  2. UNESDAFrom Linear to Circular – check out UNESDA's new blog
  3. Nordic Council of Ministers40 years of experience have proven its point: Sustainable financing actually works
  4. Nordic Council of MinistersNordic and Baltic ministers paving the way for 5G in the region
  5. Nordic Council of MinistersEarmarked paternity leave – an effective way to change norms
  6. Nordic Council of MinistersNordic Climate Action Weeks in December

Latest News

  1. No breakthrough at EU budget summit
  2. EU leaders struggling to break budget deadlock
  3. German ex-commissioner Oettinger lands Orban job
  4. How big is Germany's far-right problem?
  5. Plastic and carbon proposals to help plug Brexit budget gap
  6. Sassoli repeats EU budget rejection warning
  7. Why Miroslav Lajčák is the wrong choice for EU envoy
  8. Unhappy EU leaders begin budget haggle

Join EUobserver

Support quality EU news

Join us