Hong Kong implements new disclosure rules for extractive industries
June 3, 2010
New Disclosure Rules for Hong Kong Stock Exchange Will Improve Investment Climate, Transparency, and Accountability
WASHINGTON, D.C.-New disclosure rules going into effect today for petroleum and mineral companies listed with the Hong Kong stock exchange (HKEx) will increase transparency and accountability in the extractive industries sector with beneficial implications for Hong Kong's investment climate, said Global Financial Integrity (GFI).
Under the new reporting requirements, applicant oil and mineral companies would disclose significantly more details about their operations including taxes, royalties, and other payments made to governments on a country by country basis.
"Hong Kong's new reporting regulations set an important precedent for establishing country-by-country reporting for extractive industry companies and sends a clear message about the importance of transparency to investors," said Heather Lowe, Director of Government Affairs for Global Financial Integrity.
Similar to Hong Kong's new rules, the Energy Security Through Transparency Act (ESTTA) (S. 1700) would entail similar reporting for companies in the extractive industry sector that must report to the U.S. Securities and Exchange Commission, which includes 90% of the world's international oil and gas companies, including both U.S. and foreign companies. The bill has bi-partisan support and is currently awaiting action in the U.S. Senate Banking Committee.
"Hong Kong is now leading the way in holding the extractive industry sector accountable for complying with international best practice standards, providing critical information to investors, and empowering governments and their citizens to account for the use of their natural resources," said Ms. Lowe. "The U.S. should follow suite with passage of the ESTTA and keep pace with new investor priorities and changing international standards."
Global Financial Integrity (GFI) promotes national and multilateral policies, safeguards, and agreements aimed at curtailing the cross-border flow of illegal money. In putting forward solutions, facilitating strategic partnerships, and conducting groundbreaking research, GFI is leading the way in efforts to curtail illicit financial flows and enhance global development and security.
For additional information please visit www.gfip.org or contact: Monique Perry Danziger