“The agreement on the disclosure requirements for the extractive and forestry industries shows how EU legislation can be a catalyst for change in developing countries. Local communities in resource-rich countries will finally be better informed about what their governments are being paid by multinationals for exploiting oil and gas fields, mineral deposits and forests,” said Michel Barnier, the European Commissioner for Internal Market and Services.
The European deal follows the U.S. Securities and Exchange Commission’s rules made final last year.
The U.S. rules will force SEC-listed petroleum and mining companies, in filings with the SEC, to reveal new information about for production licenses, royalties and various other aspects of energy and mining projects.
The U.S. and European mandates are aimed at increasing transparency to help undo the “resource curse,” in which some impoverished countries in Africa and elsewhere are plagued by high levels of corruption and conflict alongside their energy and mineral wealth.
The SEC rule has drawn an ongoing legal challenge from oil industry and business groups, who contend it will create costly burdens and hand a competitive advantage to state-owned Russian and Chinese companies that aren’t bound by the mandates.
Europe’s action drew cheers Tuesday from human rights groups and activists – including U2 front-man Bono, the co-founder of the anti-poverty and public health group ONE, which is focused on Africa.
“Europe’s leaders have stepped up and delivered a game-changing breakthrough tonight. Transparency is one of the best vaccines against corruption, and now citizens the world over will know what their country’s resources are really worth,” he said.
Oxfam America, which has championed the transparency rules, said the European plan goes further then the U.S. requirements “by requiring both public and privately-held companies to disclose their payments.”
The group Transparency International said the U.S. and European rules combined will cover 90 percent of the world’s major international extractive companies, according to a Wall Street Journal report from Brussels on the rules.