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SEC To Work More on Resource Extraction Rule, Won't Appeal Judge's Decision Vacating Existing Rule; Oxfam Replies

An SEC spokesman announced earlier today that the SEC does not intend to appeal a judges decision reached in July, that effectively vacated the Commission's existing Resources Extraction Payment Disclosure Rule; instead, the Commission will undertake further proceedings with respect to that rule, informed by the court's decision.

Law firm Covington & Burling previously reported on the D.C. District Court Judge's decision vacating the SEC rule, American Petroleum Institute, et al. v. Securities and Exchange Commission and Oxfam America, Inc., No. 12-1668 (D.D.C. Jul. 2, 2013).   

In an article published earlier today entitled SEC Says Won't Appeal Resource Payment Disclosure Ruling, Reuters reporter Sarah N. Lynch was among the first to report on the SEC's decision not to appeal the Judge's ruling, including including SEC Spokesman John Nester's statement that (emphasis added):
The court remanded the matter for further SEC proceedings, which the commission will undertake informed by the court's decision.
 
 Lynch offers up information as to the opposition to  the rule: 

...the American Petroleum Institute and the U.S. Chamber of Commerce filed a legal challenge against the SEC's rule, saying it imposes enormous costs on the industry and goes outside the scope of congressional intent by forcing all of the data to be publicly disseminated to investors.

The industry groups also argued the SEC failed to include common-sense exemptions by forcing disclosure of payments to countries like China and Angola, where such disclosures are illegal.

In early July, U.S. District Judge John Bates said he agreed with a handful of the trade groups' arguments....

And the Reuters writer provides this background as to the backers of the rule: 
 
Throughout August, proponents of the rule including current and former U.S. senators, investors, and human rights groups like Oxfam America have been urging SEC Chair Mary Jo White to reissue strong new regulations as soon as possible.
 
In a series of letters, they have asked the SEC to retain a requirement to make all of the reports disclosing the payments to other countries public.

Oxfam America, one of the major backers of Section 1504 of the Dodd-Frank Act which required the SEC to issue a resource extraction payment rule, issued a press release today entitled,  SEC Urged to Re-Issue Strong Oil Transparency Rules.  There are links at the bottom of Oxfam's press release to recent letters sent by investor organizations and Senators to the SEC on the resource extraction payment disclosure rule.  

Another organization, Publish What You Pay (PWYP-US), issued a press release earlier today entitled, Investors & Congress Call on the SEC to Swiftly Deliver Strong Rules; the U.S. Must Maintain Its Role in Anti-Corruption Efforts.

As to exactly what form the SEC's future rulemaking may take, in terms of an amended rule, etc., I would look to further statements from the SEC; as of the time this blog was posted, the SEC's News Digest for today (Sept. 3) had not yet been released, that is one place there may be further info, or potentially in other statements or speeches by SEC Commissioners or staff in forthcoming days and weeks. (One place I'd recommend folks check out for up-to-date info on all things SEC, FASB, PCAOB and IASB is FEI's Current Financial Reporting Issues Conference or CFRI, Nov. 18-19 in NYC, visit www.fei-cfri.org.
Posted: 9/3/2013 6:05:35 PM by Edith Orenstein | with 0 comments
Filed under: SEC To Revise Resource Extraction Rule,SEC Won't Appeal Resource Extraction Rule,Extraction,Resource,Revise,Rule,SEC,To,Won't,Appeal


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Edith Orenstein