“The trend is in our direction.” Appeals Court loss is latest setback for oil company secrecy campaign.

May 2nd, 2013

Cross posted from Oxfam America’s Politics of Poverty blog.

Two key moments stand out for me last week. On Monday I saw former Senator Lugar (R-IN) receive Transparency International USA’s “Integrity Award” for his work to combat corruption, whether through his oversight hearings of World Bank projects or his leadership on the Dodd-Frank Act, specifically the Cardin-Lugar oil, gas and mining payment disclosure provision. . During a dinner co-sponsored by Exxon, Senator Lugar recounted his lobby visits from oil company representatives during the consideration of this legislation that now requires oil, gas and mining companies to disclose their payments to host governments. After hearing them out, Lugar and his staff simply weren’t persuaded by industry arguments about competitive harm or compliance costs. Looking forward, Lugar referenced the litigation that the American Petroleum Institute has launched against the provision bearing his name and said that no matter the outcome, “The trend is in our direction.”

The case will now go back down to the district court where there will be more opportunity for a comprehensive review of the administrative record, which we believe will demonstrate the hollowness of oil industry arguments.

Indeed it is. On Friday morning I learned that the US Court of Appeals was not persuaded by the jurisdictional arguments of the oil industry’s lawyers, (Eugene Scalia and company from Gibson Dunn).The Appeals Court dismissed the case agreeing with Oxfam’s lawyers that the case should be heard the district court first as Congress had instructed. Oxfam, as an intervener, was the only party to argue that this case does not belong in the Appeals Court and the court adopted Oxfam’s reasoning throughout the entire opinion.

This is a victory for transparency campaigners in the Publish What You Paycoalition. With the dismissal, the case will now go back down to the district court where there will be more opportunity for a comprehensive review of the administrative record. Such a review, we believe, will demonstrate the hollowness of industry arguments.

While the legal process continues, global momentum for increased transparency in the oil, gas and mining industry gains steam. In April, the European Union agreed on tough new rules that mirror Cardin-Lugar, with no exemptions for companies for alleged host government prohibitions. Once again, politicians and regulators were not persuaded by industry arguments and fear mongering. In Canada, Publish What You Pay is working with the Mining Association of Canada to develop mandatory disclosure proposals for the government. Later in May, Newmont Mining, the US and UK governments, and investors will highlight the importance of mandatory disclosure rules on the sidelines of the Extractive Industries Transparency Initiative global conference in Sydney, Australia. Finally, the UK government is championing transparency as part of its hosting of the G8 in June.

As the transparency tide reaches many corners of the globe, the war on transparency being waged by companies such as Shell, BP, Exxon and Chevron will seem increasingly doomed and misguided.

Written by Ian Gary

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