Dodd-Frank Update: SEC Rule Requires Resource Extractors to Disclose Government Payments
The Securities and Exchange Commission has implemented a new rule that will require resource extractors – companies engaged in the commercial development of oil, natural gas, and minerals – to disclose certain payments made to governments. From law firm McDermott Will & Emery:
“On Wednesday, August 22, 2012, the U.S. Securities and Exchange Commission issued final rules on Section 1504 of the Dodd-Frank Act, which requires resource extraction issuers to publicly disclose certain payments made to the U.S. and to foreign governments that are more than $100,000 in a fiscal year. Payments must be detailed by type and total amount and must be reported on a project-by-project basis. Intended to bring greater transparency and accountability to the industry, these new rules are controversial and have raised concerns about the added cost of compliance and whether there are competitive disadvantages to issuers. Companies with reporting requirements under this new rule should begin as soon as possible to determine how and whether these new rules apply…
Consistent with the Commission’s proposed rules, the final rules do not exempt small entities from disclosure requirements. All companies meeting the definition of a resource extraction issuer, including companies considered ‘small businesses’ or ‘small organizations,’ are subject to Section 13(q)’s disclosure requirements. In addition, affected issuers are required to disclose payments made by a subsidiary or another entity controlled by the issuer.”
Read the update, SEC Shines Light on Resource Extractor Payments - McDermott Will & Emery»
