A federal court of appeals in Washington, DC, Friday dismissed an industry challenge to a Securities and Exchange Commission (SEC) rule requiring producers to publicly report how much they pay governments for access to oil, natural gas and minerals.
The American Petroleum Institute (API), U.S. Chamber of Commerce, Independent Petroleum Association of America, and the National Foreign Trade Council argued their case before the U.S. Court of Appeals for the District of Columbia in late March, raising both constitutional and statutory claims.
“We hold that we lack authority to hear this suit in the first instance and dismiss the petition for lack of jurisdiction,” said a three-judge panel for the appellate court. “‘Out of an abundance of caution,’ petitioners also filed suit in United States District Court. Their caution proved prescient,” the judges said.
This rule damages the competitiveness of American companies by requiring business-sensitive information to be shared with America’s global competitors, such as those in China and Russia, API and the other groups said.
In their lawsuit filed last October, the groups argued that the rule goes far beyond what Dodd-Frank required (see Daily GPI, Oct. 12, 2012). “Section 1504 requires only that a ‘compilation’ or aggregation of payment information made by all U.S. companies to each foreign government and federal government be made publicly available. The SEC, however, grossly misinterpreted its statutory mandate to require that each U.S. company publicly file a report on the Commission’s online electronic database, detailing each payment made to each and every foreign government, for each and every ‘project’ relating to extractive industry.”
The Dodd-Frank final rule cleared the SEC by a vote of 2-1 in August 2012 (see Daily GPI, Aug. 23, 2012). It requires producers to disclose in their annual reports information relating to their resource extraction payments, or those of a subsidiary or any other unit under their control, to a foreign government or to the U.S. government for the commercial development of oil, natural gas or minerals. It defines commercial development of oil, gas and minerals to include exploration, extraction, processing and exports, according to the SEC. It would require the reporting of “any payment, whether [it is] a single payment or a series of related payments, that equal or exceeds $100,000 during the most recent fiscal year.”
Â©Copyright 2013Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2021 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |