Last week the Securities and Exchange Commission (SEC) approved regulations governing anti-corruption reports that would apply to mining and energy firms in both Canada and Europe. These rules will require firms to disclose payments made to foreign governments, a move which alerts necessary authorities to possible pay-for-play deals.
However, the reports will not include particular disclosures on anti-corruption that are needed by regulators in Canada, EU and the UK, in addition to breakdowns of each project. Various companies, including Equinor from Norway, Shell, BP and Eni, have requested that the SEC line up its rule with the reporting standards of other jurisdictions.
According to regulations that have been approved by a divided SEC in the United States, it will not be necessary for companies such as Chevron and ExxonMobil to report payments that have been linked to particular project contracts. Companies that had complied with international reporting standards may utilize this information to help meet the current SEC requirements.
Allen & Overy partner Ken Rivlin stated that the SEC vote might have been an attempt to help American companies, adding that this may be one of many areas where the outgoing Trump administration is complicating issues for the incoming administration.
The recent vote makes this the third time the SEC has authorized extraction rules that apply to U.S. resources. The regulations had been authorized in the 2010 Dodd-Frank Wall Street reform law. The first version of the law, which was rescinded in a federal court shortly after its adoption in 2012, had included disclosure requirements for particular projects.
Later in 2017, Trump administrators and Congress had impeded the SEC’s second attempt, which had included the disclosures of all payments made for each project.
The American Petroleum Institute, a lobbying group that speaks for firms such as Chevron and ExxonMobil, has opposed SEC rules that were tighter, stating that the regulations put many U.S. companies at a competitive disadvantage in most countries around the globe.
Allison Lee, who will be leading the agency once Biden becomes president, had voted against the regulations, stating that the final regulations by the SEC would decrease the number of companies that would be needed to disclose information on payments and decrease the responsibilities of companies that did not disclose information while also decreasing the amount of information that could be divulged by a company.
Elsewhere in North America, different companies are continuing with their operations after the initial disruptions of the current pandemic. An example is Canadian-based Josemaria Resources Inc. (TSX: JOSE) (OTCQB: JOSMF), which fully owns a copper and gold mining project in Argentina.
NOTE TO INVESTORS: The latest news and updates relating to Josemaria Resources Inc. (TSX: JOSE) (OTC: JOSMF) are available in the company’s newsroom at https://ibn.fm/JOSMF
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