EU PARLIAMENT SUPPORTS MANDATORY REPORTING BY OIL, GAS AND MINING COMPANIES FOR EACH COUNTRY OF OPERATION

November 14, 2007

BRUSSELS—The European Parliament today called for a new international accounting standard requiring oil, gas and mining companies to report critical financial information, such as payments to governments, on a country-by-country basis. The European Parliament has thereby endorsed a long-standing demand of Publish What You Pay (PWYP), a global civil society coalition of over 300 groups fighting for greater transparency and accountability in the extractive industries that dominate the economies of many developing countries.

Today's European Parliamentary resolution rejected the European Commission's recommendation that voluntary reporting guidelines would be sufficient. International accounting standards, on the other hand, are legally binding in more than fifty countries.

"We applaud the European Parliament for recognising that a mandatory standard is needed," said Radhika Sarin, International Coordinator of PWYP. "This will ensure citizens in producing countries have access to information they need to hold their governments to account."

Last year, the International Accounting Standards Board (IASB) established a sub-group to look into the development of such a new requirement but it has yet to put the issue onto its formal standard-setting agenda.

"The IASB should move promptly to deliver the new reporting standard, as called for by the European Parliament," said Vanessa Herringshaw, London Director of Revenue Watch Institute, an international independent organisation that promotes responsible management of natural resource wealth for the public good.

Investors are also calling for more country-specific information to better judge value and risks when making decisions about whether to invest in oil, gas and mining companies.

"This is an area in which the interests of investors, governments, civil society and ethical companies converge," continued Herringshaw. "A uniform international disclosure standard will help protect ethical companies that want to operate in the open from being under-cut by those that may exploit secrecy to cut corrupt deals."

The U.S. Congress is also showing interest in mandatory reporting. A recent hearing of the Financial Services Committee of the House of Representatives explored how the U.S. might address the lack of transparency in oil, gas and mining industries by requiring companies listed with the U.S.'s Securities and Exchange Commission to disclose their natural resource payments to individual governments as part of their annual filings.

Standard setters should act now to develop new global mandatory standards for transparency in the extractives sector.

To discuss the resolution with MEP Pervenche Berès, Chairwoman of the Economic and Monetary Affairs Committee of the European Parliament, please contact Rachael Taylor: +44(0)7976 589 179, rtaylor@publishwhatyoupay.org.

For further information, contact Vanessa Herringshaw, vherringshaw@revenuewatch.org, +44(0)7900 492 631.