You can download this press release to view the original PDF
WASHINGTON, DC – Prominent members of Congress submitted legal briefs this week to the Court of Appeals for the District of Columbia Circuit to defend a landmark transparency law against an oil industry lawsuit. The law, supported by the global Publish What You Pay (PWYP) coalition, requires oil and mining companies to publish their payments to the U.S. and foreign governments for resource extraction. PWYP member Oxfam America has also filed a brief as an intervenor in the lawsuit.
“In an era where tax dollars are scarce, this common-sense law shines a light on billions in financial flows to the U.S. and foreign governments to empower citizens to follow the money and make sure it’s put to good use,” said Isabel Munilla, Director of Publish What You Pay US. “The message from Congress is clear: The oil industry’s claims are flat wrong and their frivolous lawsuit puts investors at risk and undermines the energy security interests of the United States.”
The lawsuit is led by the American Petroleum Institute (API), the U.S. Chamber of Commerce, the International Petroleum Producers Association and others. It seeks to overturn Section 1504 or the Cardin-Lugar Amendment of the Dodd-Frank Financial Reform Act, as well as implementing regulations approved in August 2011 after a 2-year rulemaking process by the Securities and Exchange Commission.
In their brief, Senator Ben Cardin (D-MD) and Carl Levin (D-MI) joined recently retired Senator Richard Lugar (R-IN) rejected oil industry claims that the law violates their constitutional rights to free speech under the First Amendment:
“Resource companies can believe whatever they wish and make any communication they wish about their payments to foreign governments, ‘the resource curse,’ or the benefits or costs of transparency; they have done so throughout this process. What resource companies may not do is impede the power of the legislative branch to require disclosure of objective information to fulfill compelling public policy objectives, including the strengthening of American national and energy security and investor protections.”
The Senators also rejected the industry’s arguments that they should be given blanket exemptions from disclosure for alleged legal prohibitions in host countries. API can “point to no evidence that the final rule would actually conflict with the existing laws of any foreign country. Absent that evidence, there is no practical basis even to consider an exemption, and if the agency allowed exemptions, this would provide an incentive for foreign governments to subvert U.S. law by passing laws that prohibited disclosure,” stated the Senate brief.
Members of the House of Representatives, including ranking member of the House Financial Services Committee Maxine Waters (D-CA) and ranking member of the Natural Resources Committee Edward Markey (D-MA) submitted a brief rejecting industry claims that SEC should have allowed confidential submission of their payment data. The Representatives said that SEC was given “no relevant discretion” to do anything other than require public disclosure to meet the goals of the law:
“Investors and the public need to be able to fully evaluate whether a company has properly addressed the commercial, political, and legal risks it faces when operating around the globe in environments where corruption is rife and rule of law weak. The Resource Extraction Rule, and the country-by-country and project-by-project data that will be disclosed under it, are critical to giving investors and the public the ability to make these evaluations.”
Oxfam’s intervenor brief highlights how the law will support stable and democratic governments while helping investors calculate a company’s risk. The brief further argues that API’s claims are without merit and that the SEC sensibly dismissed most of them in its final rule. Regarding oil industry claims of First Amendment violations, the brief says that oil companies have “no constitutional right to keep payments to foreign governments secret.”
The three briefs submitted this week follow the US Department of State’s declaration last week that Cardin-Lugar advances US foreign policy interests in increasing transparency and reducing corruption.
“Corruption and mismanagement of these resources can impede economic growth, reduce opportunities for U.S. trade and investment, divert critically-needed funding from social services and other government activities, and contribute to instability and conflict,” declared the State Department.
“Congress, the SEC, the State Department and PWYP members have made clear that they will fight to protect global transparency standard that the US has set from companies that want their tax payments to the US and foreign governments to be kept secret,” said Munilla. “With Europe poised to finalize similar rules, it’s clearly time for API to drop this lawsuit and embrace transparency.”
Notes to editors:
Publish What You Pay is a global civil society coalition that believes that the wealth generated by oil, gas and mining industries can be a pathway to poverty reduction, stable economic growth and development in resource-rich countries. Founded in 2002, PWYP comprises over 600 organizations working from nearly 70 countries that advocate for revenue transparency as a necessary ingredient for accountability. In the U.S., PWYP comprises 35 members, including development, faith-based, human rights, environmental, financial reform and anti-corruption organizations representing over 2.5 million constituents spread through every state in the nation.
PWYP US Members: ActionAid International USA • Amnesty International USA • Bank Information Center • CARE • Catholic Relief Services • Columban Center for Advocacy and Outreach • CorpWatch • Crude Accountability • EarthRights International • EARTHWORKS • EG Justice • Environmental Defense Fund • Friends of the Earth • Gender Action • Global Financial Integrity • Global Rights • Global Witness • Government Accountability Project • Human Rights Watch • International Budget Project • International Labor Rights Forum • Justice in Nigeria Now • ONE Campaign • Open Society Policy Center • Oxfam America • Pacific Environment • Presbyterian Church USA • Project On Government Oversight • Revenue Watch Institute • Robert F. Kennedy Center for Human Rights • Sierra Club • Sustainable Energy & Economy Network • United Steelworkers • United to End Genocide
FOR IMMEDIATE RELEASE: January 18, 2013
Contact: Isabel Munilla – email@example.com
(202) 496-1179 office — (202) 680-4606 mobile