The EU has today agreed ground-breaking new rules forcing oil, gas, mining and logging companies to publish details of the payments they make to governments for access to natural resources around the world.
By providing millions of citizens in resource-rich countries with detailed information about the money generated by their natural resource sectors, the directive represents a watershed moment in the fight against corruption, and is a major victory for Publish What You Pay and Global Witness after 15 years of fighting for these measures.
The European Parliament and Council have agreed that the EU's Accounting and Transparency Directives will require all EU-listed and large, privately owned oil, gas, mining and logging firms to disclose the payments they make to governments (Note 1).
Companies will be required to publish all payments over €100,000 including taxes, royalties and licence fees and do so wherever they operate around the world. The directive brings Europe in to line with the U.S. which introduced similar financial disclosure laws in 2010 through the Dodd-Frank Act.
Crucially, the directive will require the publication of information made for each individual resource project companies invest in - thereby allowing communities to monitor payments from extraction projects in their local areas.
The EU has also rejected calls from industry to include a loophole in the law which, if adopted, would have exempted companies from publishing payments in certain countries, potentially enabling illicit payments to be made unseen.
"This is a huge victory for transparency and we commend the parliamentarians and officials from the Member States and the Commission who have steadfastly championed this legislation", said Simon Taylor, Director at Global Witness who co-launched the Publish What You Pay campaign in 2002.
"Extractive companies channel hundreds of billions of euros to governments every year in payments for natural resources, but without transparency citizens are regularly robbed of the benefits that this wealth should bring.
As a result of this directive, millions of people will now be able to see how much companies pay their governments, enabling them to follow the money if they don't see any benefits from the cash."
The MEPs Arlene McCarthy and Klaus-Heiner Lehne championed the transparency provision in the directive with support from across the EU political spectrum including ALDE (liberals), Greens, Socialist and EPP (conservative) groupings.
"This decision marks a watershed moment for extractive industry campaigners including Global Witness, part of the 650-strong Publish What You Pay coalition of citizens' groups that has campaigned for over a decade for exactly these measures," said Brendan O'Donnell who leads Global Witness's oil campaign.
"We now have the basis for a global 'publish what you pay' transparency standard with the EU, U.S. and EITI all demanding sunshine on oil, gas and mining deals. We hope that the remaining G8 countries will agree similar measures when they meet in June." (Note 2)
The Directives will go to plenary in Parliament for final approval, expected in June of this year.