USA: Govt. withdraws from Extractive Industries Transparency Initiative

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Article
7 February 2018

Civil society organizations call on ExxonMobil and Chevron to be removed from the EITI Board

Author: Publish What You Pay - United States

We are writing to draw your attention to actions by EITI Board members that we believe constitute violations of the EITI Code of Conduct and, as such, are grounds for their immediate removal... [W]e urge that the February EITI Board meeting include a discussion about the refusal of ExxonMobil and Chevron to disclose their tax payments through the term of implementation of the EITI Standard in the United States. We believe strongly that the refusal to engage in this most basic aspect of compliance with the EITI Standard constitutes a repeated and willful violation of the EITI Code of Conduct, the EITI Constituency Guidelines... and an act of bad faith that is counter to the spirit of the EITI movement itself. 

... During the December 2015 USEITI MSG Meeting, an ExxonMobil representative [explained]... his company’s decision not to disclose taxes through the USEITI process: “… knowing that income tax reporting will soon be required under Section 1504 of the Dodd-Frank Act, companies may have chosen to wait until that rule was finalized and the requirements more clear. (ExxonMobil representative) added that many of these companies have exercised leadership in EITI around the world, and are very committed to USEITI and to tax reporting, but are awaiting the finalization of the SEC’s rulemaking.”

In the November 2017 statement announcing the end of USEITI implementation, the U.S. Department of Interior falsely suggested that U.S. laws restrict companies from voluntarily disclosing information, including taxes... To the contrary, Dallas-based Kosmos Energy has voluntarily disclosed its U.S. tax payments for years, and BHP Billiton... voluntarily disclosed its tax payments to the U.S. government before it was required to do so by the EU Directives.

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Article
28 November 2017

Global Witness opposes U.S. withdrawal from Extractive Industries Transparency Initiative

Author: Global Witness

...The move was an inevitable result of the insistence of major U.S. oil companies ExxonMobil and Chevron on keeping their U.S. tax payments secret. In addition, earlier this year, these companies led the attack on a related U.S. regulation that required extractive companies to publish their payments to governments around the world.

“We strongly dispute the U.S. government’s claim that U.S. laws prevent compliance with the EITI standard when it is Exxon and Chevron’s preference for secrecy that made it impossible for the U.S. to comply,” said Corinna Gilfillan, Head of U.S. Office at Global Witness. “When major Russian and Chinese oil companies are disclosing more information about their deals around the world than their U.S. counterparts, you have got to ask: what are Exxon and Chevron so desperate to hide?”...

[We invited Chevron and ExxonMobil to respond to this article. ExxonMobil response provided. Chevron did not respond.]

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Article
28 November 2017

News: Trump Administration Further Erodes US Leadership on Combatting Corruption

Author: Publish What You Pay

2 Nov 2017

...“We are disappointed with the Department of Interior’s unilateral decision to withdraw from USEITI. We are dismayed by the DOI’s characterization that meeting the EITI validation standard is somehow stymied by US law. In reality, the refusal of all but a handful of the involved companies to disclose tax payments – not US law – rendered the US unable to meet the basic level of transparency required by the EITI. To be clear, US law does not prevent oil, gas or mining companies from voluntarily disclosing their taxes – common practice in the dozens of EITI implementing countries,” said Jana Morgan, Director of Publish What You Pay – United States. “In fact, Houston-based oil company Kosmos Energy voluntarily disclosed their tax payments to the US government last year. However, with the support of the American Petroleum Institute (API) companies like Chevron and ExxonMobil have consistently refused to comply with the EITI requirement to disclose their federal tax payments.”...

[We invited Chevron and ExxonMobil to respond to this article. ExxonMobil response provided. Chevron did not respond.]

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Company response
27 November 2017

Chevron response

Author: Chevron

We invited Chevron to respond to the following:

"News: Trump administration further erodes US leadership on combatting corruption", Publish What You Pay, 2 Nov. 2017

"Global Witness opposes U.S. withdrawal from Extractive Industries Transparency Initiative", Global Witness, 2 Nov. 2017

Chevron responded as follows:

"Thank you for your inquiry regarding the USEITI.  In response, we refer you to the USEITI website, which illustrates some of the significant economic contributions the U.S. oil and gas industry makes every year in the United States. Chevron has been actively involved in the USEITI process for four years."

Company response
27 November 2017

ExxonMobil response

Author: ExxonMobil

We invited ExxonMobil to respond to the following:

"News: Trump administration further erodes US leadership on combatting corruption", Publish What You Pay, 2 Nov. 2017

"Global Witness opposes U.S. withdrawal from Extractive Industries Transparency Initiative", Global Witness, 2 Nov. 2017

ExxonMobil responded as follows:

The following op-ed published earlier this year in the Dallas Morning News by Suzanne McCarron, our vice president of public and government affairs, accurately reflects the company’s views. I hope this helps.

https://www.dallasnews.com/opinion/commentary/2017/01/13/transparency-foreign-governments-good-exxon

An excerpt:

ExxonMobil supports multi-stakeholder engagement for the purpose of increasing transparency of government revenues from the extractive industries. We support the EITI application, validation and implementation processes wherever we operate. We are also currently working with governments in several countries, including Guyana and Mexico, which are considering joining EITI. There are currently about 51 countries that are compliant members or have been accepted as candidates to begin reporting under the EITI Standard.

Article
1 November 2017

US Department of the Interior statement to the Extractive Industries Transparency Initiative Board

Author: Gregory Gould, Office of Natural Resources Revenue Director, US Department of the Interior

The United States has made significant progress meeting individual requirements of the Extractive Industries Transparency Initiative (EITI) since the fall of 2011 when the U.S. announced that it would begin the multi-year process of becoming an EITI compliant country. The Department of the Interior established a multi-stakeholder group in December 2012 and achieved Candidate Country status in March 2014. Perhaps our most significant accomplishment is the creation of an open source, open code interactive web-based data portal (https://useiti.doi.gov) on which the agency has unilaterally disclosed 2013, 2014, and 2015 revenues by company, commodity, and revenue type, as well as production data across all commodities. This portal is the new global standard in revenue governance transparency...While the U.S. government remains commited to fighting corruption in the extractive industries sector, and the ideals of transparency enshrined in the EITI Principles and the EITI Standard, it is clear that domestic implementation of EITI does not fully account for the U.S. legal framework. Effective immediately, therefore, the United States must withdraw as an EITI Implementing Country...

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Article
1 November 2017

EITI Chair Statement on United States withdrawal from the EITI

Author: EITI Secretariat

[T]he United States government announced that it was discontinuing EITI implementation [Extractive Industries Transparency Initiative]. The EITI Chair, Fredrik Reinfeldt, issued the following statement:

"This is a disappointing, backwards step. The EITI is making important gains in global efforts to address corruption and illicit financial flows...to combat transnational crime and terrorist financing. It’s important that resource-rich countries like the United States lead by example. This decision sends the wrong signal.

The United States has been implementing the EITI since 2014. The USEITI multi-stakeholder group (MSG) has been a valuable platform for dialogue, encouraging state and tribal participation. Under the auspices of the EITI, the Department of Interior has made strides in modernising royalty revenue management. The MSG developed a simple procedure to provide greater transparency on corporate income tax payments. Regrettably, the majority of companies declined to report. The disapproval of the SEC Rules implementing the Dodd Frank provisions on the disclosure of payments by resource extraction issuers was a set-back, undermining the EITI’s efforts..."

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