By Ben Geman
Incoming House Financial Services Committee Chairman Spencer Bachus (R-Ala.) may take aim at a provision tucked into the Wall Street reform law that forces oil and mining companies to disclose specific, project-level information about payments to foreign governments.
Count Bachus among the critics of the provision authored by Sens. Ben Cardin (D-Md.) and Dick Lugar (R-Ind.), which was added to the bill during the marathon final negotiating session last summer.
Bachus says it will put U.S. companies at a disadvantage to firms from China and elsewhere when competing for projects. “This could really put us in a straitjacket,” Bachus told The Hill Friday in the Capitol.
“A provision like that, it is not so much a financial issue as it is a national security issue,” he said. “It could have disastrous consequences for our manufacturing economy and for consumers — it could drive up costs of consumer goods. It is very troubling.”
Bachus stopped short of pledging to modify or kill the provision when he leads the powerful committee next year. But he hardly ruled it out either. “I don’t make those types of decisions just off the cuff. We are not going to do anything without deliberation,” he said when asked whether he’d seek repeal, but added: “I can tell you it is on our radar.”
“I consider it problematic,” he said. “We are going to look at it.”
The oil industry is pressing the Securities and Exchange Commission for several exemptions as the regulators craft rules to implement the law. The agency floated draft rules this week and is taking comments on possible exemptions.
Advocates of the disclosure say increased transparency of payments will help reverse the “resource curse” in which energy- and mineral-rich nations in Africa and elsewhere are plagued by high levels of corruption, conflict and poverty.
But oil companies like Exxon — while noting they support transparency — say the provision will be burdensome and put them at a competitive disadvantage compared to firms such as Russia’s state-backed Gazprom that would not have to file with the SEC.
Bachus said an existing statute — the Foreign Corrupt Practices Act — already provides protections. “There is already a full disclosure of the things you would need to know from the standpoint of ‘is there corruption,’ ” he said. “This goes far beyond that to really giving the Chinese, or whoever our competition is, the right to know exactly what we are offering. It is very problematic.”
Culled from: http://thehill.com/blogs/e2-wire/677-e2-wire/134287-new-house-finan...