White House to prod countries on oil revenue ‘transparency’

The White House said Friday it would push other countries to adopt rules that force oil and mining companies to disclose payments they make to foreign governments.

The statement appears to be a nod to industry fears that newly enacted U.S. requirements will create a competitive disadvantage for American companies competing overseas.

The Wall Street reform bill that President Barack Obama signed this week will force many companies to provide the Securities and Exchange Commission information on foreign payments for production licenses, taxes, royalties and other aspects of energy and mineral projects.

“Importantly, this provision sets a new standard for corporate transparency. The challenge for us now is to make this a global standard. The United States is committed to working with other countries to ensure the implementation of similar disclosure requirements in other financial markets and will make this a priority in the year ahead,” White House Press Secretary Robert Gibbs said in a statement Friday afternoon.

Business groups including the American Petroleum Institute and the U.S. Chamber of Commerce opposed the provision, arguing that it will hamstring U.S. companies competing against state-run or state-controlled Russian and Chinese firms.

The new requirements in the Wall Street bill are the work of Sens. Richard Lugar (R-Ind.) and Ben Cardin (D-Md.). They and other advocates of the disclosure say increased transparency of payments will help reverse the “resource curse” in which some energy- and mineral-rich nations in Africa and elsewhere are plagued by high levels of corruption, conflict and poverty.

The White House statement strongly praises the provision, which also requires companies to disclose their payments to the U.S. government.

“This provision is an essential new tool in promoting transparency in the oil and mineral sectors. This legislation will immediately shed light on billions in payments between multinational corporations and governments, giving citizens the information they need to monitor companies and to hold governments accountable,” the White House said.

“It will shine a sustained light on the relationship between corporations and governments in the oil and mineral sectors, and make impossible the kind of back-room dealings that cost taxpayers in lost royalties," the statement adds.