Oxfam condemns today’s vote by the House Financial Services Committee in favor of proposed legislation that would gut current securities law and allow oil and mining companies to keep billions in payments to governments secret, a move that would be a gift to corrupt elites in the US and around the world.
Rep. Royce (R-CA), the Chairman of the House Foreign Affairs Committee, broke with his party and voted with all 26 Democrats on the House Financial Services Committee to vote against HR 4519, which seeks to repeal Section 1504 of the Dodd-Frank Act. Also known as the Cardin-Lugar provision, section 1504 requires foreign and domestic oil and mining companies listed on US stock exchanges to disclose their payments to governments. The law is meant to shine a light on billions in oil and mining financial flows to governments to help citizens follow the money and investors manage risk. The majority of Republicans on the committee voted to repeal it.
“As corruption scandals continue to plague oil and mining companies trading stocks on U.S. exchanges, it’s alarming that the House Financial Services Committee voted today to repeal a landmark oil and mining anti-corruption law,” said Isabel Munilla, Oxfam America’s Policy Lead for Transparency in Extractive Industries. “Today’s vote demonstrates either ignorance or complete disregard of the support for the anti-corruption law from oil and mining investors worth nearly $10 trillion. Repealing Section 1504 would allow oil and mining companies to keep billions in payments to governments secret, and is a gift to corrupt elites in the US and around the world.”
Oxfam and investors have a shared interest in stable and accountable democracies with economic opportunities for all citizens, which underpin strong investment markets. Oil and mining payment secrecy prevents citizens from following the money and tackling corruption.
Oxfam calls into question Rep. Bill Huizenga’s motives to introduce and advance the bill. As Chair of the Capital Markets Subcommittee on House Financial Services, he should have his finger on the pulse of energy markets and investor interests. However, his bill ignores US global leadership on the issue, which is now followed by 30 other countries that adopted rules modeled on Section 1504. This includes the EU and Canada, the second and third largest oil and mineral capital markets, after the United States. His bill also ignores major companies in the oil and mining sector that have been reporting this kind of information successfully for several years.
In remarks before the committee, Mr. Huizenga also stated that part of the rationale for the repeal was the US participation in the Extractive Industries Transparency Initiative, which includes more than 60 other countries. However, the US formally withdrew from the initiative on November 2 of this year.
“US voters should take note of which Members of Congress voted for corruption today. Instead of making progress towards stronger, more stable energy markets and accountable governments, we’re in a game of whack-a-mole with repeal efforts,” continued Munilla. “By voting to roll back this anti-corruption law, Members of Congress are voting to fuel corruption and keep poor countries dependent on U.S. foreign aid.”