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UPDATE 1-UK, France to join resource transparency initiative
May 22, 2013 / 9:23 PM / 5 years ago

UPDATE 1-UK, France to join resource transparency initiative

* Britain accused of hypocrisy for not signing up

* Body agrees tougher disclosure measures in Sydney

By Emma Farge and William James

GENEVA/LONDON, May 22 (Reuters) - The UK and French governments will join a global initiative that will require oil and mining firms to comply with new disclosure measures aimed at tackling corruption, British Prime Minister David Cameron said on Wednesday.

The Extractive Industries Transparency Initiative (EITI) has stakeholders in the public and private sectors and requires resource companies to disclose payments made to governments.

EITI terms are not legally binding, but member countries that fall short of requirements can be suspended from the process, leading to political embarrassment.

Cameron confirmed a Reuters report about the countries’ intention to join the initiative in a press conference alongside French President Francois Hollande in Paris.

Britain, currently chairing the Group of Eight major economies and home to resource firms such as Rio Tinto and BP, has said that transparency will be one of the focus areas for the G8 summit in June.

Critics have accused oil producer Britain of hypocrisy for not joining the EITI initiative, currently chaired by former UK MP Clare Short, especially as the Labour government helped to create it in 2002.

“They are joining for practice-what-you-preach reasons. It’s hard to tell countries to do EITI when you’re not doing it yourself,” one of the sources said.

Global pressure to increase transparency in mining and resources has been growing, and the United States has already passed regulations that require U.S.-registered companies to disclose payments made to governments for access to resources.

The American Petroleum Institute opposed the U.S. measures and has challenged the regulations in the U.S. appeals court.

The EITI, supported by the World Bank as well as resource-rich countries such as oil producer Nigeria, agreed to a new global transparency standard at a meeting in Sydney on Wednesday.

This aims to strengthen reporting standards by breaking down data by payment type -- including tax contributions -- project and company.

The new measures will also require participants to give data on commodity sales, broken down by “individual company, government entity, and revenue stream” for the first time, the new requirements showed on Wednesday.

“This decision is the first step to fill a large gap in international rules governing transparency in the commodities sector,” said Swiss NGO the Berne Declaration.

Others said that the measures did not go far enough as they fell short of requiring members to publish a breakdown of the price for each commodity shipment.

Members have yet to agree on the phase-in time for implementing the new measures.

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