President Donald Trump has signed a congressional resolution that rolls back a rule requiring all publicly traded oil, gas and mineral resource companies to disclose payments made to foreign governments in which they operate. This joint resolution nullifies the “Disclosures of Payments by Resource Extraction Issues” rule finalized by the Securities and Exchange Commission (SEC) on July 27, 2016.
The original measure was passed in 2010 as Section 1504 of the Dodd-Frank Act and was ultimately implemented by SEC. However, the regulations came under constant fire from the energy industry, which noted that SEC’s rules put oil, gas, mineral and other resource extraction businesses at a competitive disadvantage, since many global competitors had no such disclosure requirements. For example, the American Petroleum Institute (API) said that the SEC rule would exempt extractive activities on 78 percent of all proved energy reserves, largely because those are foreign state-owned entities that are not traded on U.S. stock exchanges. Additionally, API said a model reporting tool created through the Extractive Industries Transparency Initiative was already available as a “globally accepted framework” for financial disclosure.
The joint congressional resolution, which was introduced on January 31, passed both the U.S. House and Senate in early February. The rollback took effect when Trump signed H.J. Res 41 into law on February 14.
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February 24, 2017