Brussels, 26/10/2011 (Agence Europe) - Several non-governmental organisations have given a warm welcome to the European Commission proposals to increase transparency in the area of the payments made by the extractive and logging industries to governments all over the world (EUROPE 10463) by introducing a system of country-by-country reporting (CBCR) on the taxes, royalties and bonuses paid worldwide. According to these NGOs, this initiative constitutes a first step but there is a risk that it could be circumvented.
Transparency International (TI) considers that the proposed measures would help “reduce corruption and poor governance” in countries that are rich in natural resources, particularly by compelling companies to provide information about each project set up. The legislative proposal is in line with similar rules adopted in the US and will help develop an international standard for the industry, states Transparency International. Nonetheless, TI considers that the “exemptions” planned could reduce the impact of such a measure - for example, when host countries for the companies concerned prohibit the publication of information. Moreover, the information published will not be subject to an independent audit to verify its authenticity. TI has already appealed for an extension of the rules to all sectors of activity.
According to the charities and associations network, Eurodad, the draft directive would only provide a very partial image of the activity of a specific enterprise. The organisation is advocating broader publication of information to include the name of subsidiaries (of the companies concerned) in all countries, as well as financial performance, including sales, purchases, labour costs, funding costs and profits obtained, in an effort to enable the appropriate authorities to assess compliance between the activities exercised and the taxes paid. It also expressed its disappointment regarding the limited scope of the legislative text.
The ONE organisation set up by the singer, Bono, considers that the measures announced will help to put a stop to the exploitation of natural resources that has hit African countries so hard. Nonetheless, the organisation highlights the necessity of making certain obligations tougher. It says that exports of natural resources from Africa in 2008 were nine times greater than the amounts provided for humanitarian aid. In Equatorial Guinea, GDP per capita was $35,000 in 2010, higher than that in Japan, despite the fact that three quarters of the population live on less than a dollar a day.
The European Coalition for Corporate Justice (ECCJ) asserts that other initiatives are required so that European-based companies are genuinely liable for damages caused by their subsidiaries in the field of human rights and the environment. A legal framework would also be necessary in order to improve victims' access to justice in the EU. (MB/transl.fl)