Written by Anderson Franco & Angélica Salceda
The oil industry has recently criticized the Dodd-Frank Act’s oil and gas reporting rules by claiming that the transparency requirements will result in restrained money flows between oil companies and governments. Under Dodd-Frank, all oil, gas and mining companies registered with the SEC must report payments to foreign governments on a country-by-country, and project-by-project basis.
The transparency requirements will provide detailed, standardized, and comparable data that will pressure governments to improve their revenue reports and strengthen oversight. Critics claim that the disclosures required by Dodd-Frank undermine the voluntary standard established by the Extractive Industries Transparency Initiative (EITI).
The EITI is a global standard that promotes revenue transparency and provides a methodology for monitoring and reconciling company payments and government revenues. Nevertheless, only 11 of the 35 EITI implementing countries fully comply with the requirements.
