API's Frivolous Lawsuit

API's Frivolous Lawsuit

March 22, 2013
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The U.S. Securities and Exchange Commission  today defended its final rule implementing a strong oil, gas and mining transparency law before the U.S. Court of Appeals for the District of Columbia Circuit.

API Should Drop Frivolous Lawsuit

SEC’s Oil Transparency Regulations Would Combat Resource Curse in Equatorial Guinea

(Washington, DC, March 22, 2013) –  EG Justice, a nongovernmental group that promotes human rights and good governance in Equatorial Guinea, praises the U.S. Securities and Exchange Commission (SEC) for today’s defense of its final ruleimplementing a strong oil, gas and mining transparency law before the U.S. Court of Appeals for the District of Columbia Circuit.

In August 2012, the SEC approved final regulations for Section 1504 of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, also known as the “Cardin-Lugar” Amendment, which requires U.S. and foreign oil, gas and mining companies reporting to the SEC to disclose payments to foreign governments.  In response, the American Petroleum Institute (API) and other business associations sued the SECto try to overturn both the law and SEC regulations.The lawsuit is seen by many civil society organizations, including Oxfam International and members of the Publish What You Pay coalition, as frivolous.

According to Tutu Alicante, “enhanced transparency is the surest way to combat inequality and poverty in places like Equatorial Guinea, and Section 1504 is the best hope to compel such enhanced transparency.”

Section 1504 seeks to combat the “resource curse” that occurs in poor, resource-rich countries when proceeds from oil, gas or other mineral extractions lead to corruption and wasteful spending by government leaders instead of being used for growth and development.  Congress intended for the law to empower citizens of these countries by giving them information about how payments are made to their country, enabling them to hold their government officials accountable.  This much-needed law will apply to the oil companies currently operating inside Equatorial Guinea.  The law will provide the people of Equatorial Guinea with information about how much money their government is making from natural resource extraction.

Section 1504 was meant to improve upon the Extractive Industries Transparency Initiative (EITI), a voluntary international initiative where extractive-industry companies provide information about money paid to statesin an effort to achieve transparency. 

For citizens from Equatorial Guinea who watched their country being expelled from the EITI, Section 1504 is a welcomed avenue for change.  Marcial Abaga, an anticorruption activist from Equatorial Guinea stated that, “Section 1504 signifies hope for thousands of my country men and women living in poverty, despite being in a resource-rich country.”  He asks that “the API recognize that they stand on the wrong side of history and drop this frivolous lawsuit.”

For more information, please contact:

In Tampa, Florida, for EG Justice, Tutu Alicante (English, French, Spanish): +1-615-479-0207 (mobile); or tutu@egjustice.org

Tutu Alicante, Executive Director of EG Justice, and Ian Gary, Senior Policy Manager, Extractive Industries for Oxfam America

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