After being delayed by more than a year, the Securities and Exchange Commission’s final rules on extractive industry and conflict mineral disclosures could be finalized next month.
The commission, which was sued in May by Oxfam America for delaying the extractive industries rule, set an open meeting for Aug. 22, according to a notice posted online Monday, to consider whether to adopt rules based on the provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The SEC had missed an April 2011 deadline to implement both final rules, and SEC Chairman Mary Schapiro said in March that the rules were still months from being finalized.
Section 1504 of the law requires that annual reports filed by “resource extraction issuers” with the SEC include payments made to U.S. and foreign governments related to commercial development of oil, natural gas and minerals.
Just how the SEC would interpret the requirements has been a point of contention.
Lobbyists from the oil and gas industry, led by the American Petroleum Institute, have opposed project-level disclosures, saying that such a requirement would burden companies financially and logistically.
Transparency groups have worried that a final rule that allows less specific disclosures wouldn’t have any teeth.
The extractive industries provision was introduced in an amendment to Dodd-Frank by Sens. Richard Lugar (R-Ind.) and Ben Cardin (D-Md.)
“The vote on this rule is long overdue,” Cardin said in a statement. “Revenue transparency helps hold leaders accountable, increases energy security and creates American jobs by reducing the operating risk U.S. companies face in inherently unstable markets.”
Section 1502 of Dodd-Frank requires companies to certify that minerals from the Democratic Republic of Congo are conflict free. Armed factions in ongoing fighting in the Congo have been funded by profits from the region’s mined resources.
The minerals are used to manufacture electronics and other products. Manufacturers have expressed concern about the difficulties in auditing their supply chains for the minerals.
On June 22, 58 lawmakers signed a letter urging SEC Chairman Schapiro to schedule a vote on the transparency rules by July 1 or to offer an alternative date and explain the delay.
Dodd-Frank became law in July 2010, and the SEC published proposed rules on the transparency measures that December.
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